UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA
September 17, 1982
KARAVEL SHIPPING CORPORATION OF MONROVIA
SUN INTERNATIONAL, LTD.
The opinion of the court was delivered by: GILES
MEMORANDUM AND ORDER
GILES, District Judge.
Karavel Shipping Corporation ("Karavel"), the owner and operator of a vessel, and Sun International Ltd. ("Sun"), a charterer, were parties to a transport agreement dated July 1979 for the importation of oil from certain Caribbean ports to certain ports in the Northeast United States. Two disputes pertaining to the discharge of cargo have arisen between the parties. The first focuses on whether under the written agreement, Big Stone Beach Anchorage in Lewes, Delaware, was a separate port for payment purposes or solely a lightering point. The second dispute is over whether Karavel's delay in submitting its demurrage claim was excusable neglect or willful so as to be precluded by the terms of the charter agreement. Karavel has moved for summary judgment on both liability issues. Sun has moved for partial summary judgment as to the demurrage claim.
Under Rule 56(c) of the Fed. R. Civ. P., a motion for summary judgment will be granted only if there is no genuine issue of material fact, thus entitling the moving party to a judgment as a matter of law. The moving party has the burden of showing the lack of a genuine factual issue and the pleadings are to be construed and inferences drawn in favor of the non-moving party. Adickes v. Kress & Co., 398 U.S. 144, 157, 26 L. Ed. 2d 142, 90 S. Ct. 1598 (1970); Hollinger v. Wagner Mining Equipment Co., 667 F.2d 402, 405 (3d Cir. 1981); Lynn v. Heyl and Patterson, Inc., 483 F. Supp. 1247, 1250 (W.D. Pa. 1980) aff'd 636 F.2d 1209 (3d Cir. 1980).
I. Findings of Fact
The parties agree upon the following relevant facts:
1. Alpaca Shipping Corporation, Inc. ("Alpaca") was the Manager of the S.T. Arctic Star on behalf of Karavel.
2. Sun International, Ltd. is the successor by reason of name change to Sun Oil Trading, Ltd.
3. The voyage charter agreement was on a Asbatankvoy Tanker Voyage Party Form (this form is identical to the Exxon 1969 Tanker Voyage Party Form) with the inclusion, at Sun's request, of the following Sun standard clauses:
Bill of Lading
4. Paragraph C of the voyage charter agreement provided:
One or two safe port(s) Caribbean Sea excluding Orinico River but first port to be Columbian Port on Atlantic side of Columbia. It is understood if only one port used then port shall be Columbian Port.
5. Paragraph D of the voyage charter agreement provided:
One or two safe port(s) U.S. Atlantic Coast if New York, not north of the George Washington Bridge excluding Florida or one or two U.S. Gulf excluding Florida.
6. The Sun Diversion Clause provided:
Sun Diversion Clause: Notwithstanding anything else to the contrary in this Charter Party and notwithstanding what loading and/or discharging ports may have been nominated and bills of lading issued, Charterer shall have the right to change its nomination of the loading and/or discharging ports in accordance with Part I C&D of the Charter. Any extra time and expense incurred by Owner in complying with Charterer's orders shall be for Charterer's account and calculated in accordance with Part II, Clause 4(c) of this Charter. Freight is based on the voyage actually performed. Charterer shall have the right to make as many changes as it deems necessary.
7. The Sun Lightering clause provided:
Sun Lightering Clause: If lightering is required to berth at a discharge port, it may be necessary to lighter the vessel while anchored at anchorage. Laytime at anchorage (whether or not the vessel is on demurrage) shall begin six (6) hours after receipt of Notice of Readiness by Charterers or when first lighter barge arrives alongside, whichever occurs first, and shall end when vessel weighs anchor to proceed to a berth. Laytime shall begin again upon the vessel's arrival in berth (i.e., all fast at the discharging wharf). Although the time used in such lightering shall count as laytime, such anchorage shall not be considered a second discharge port or second discharge berth and running time from anchorage to such discharge port or berth shall not count as laytime (whether or not the vessel is on demurrage).
8. Pursuant to the voyage charter agreement Sun had the right to, and did, select and designate all loading and discharge ports.
9. During the voyage Karavel operated the S.T. Arctic Star under the instructions, directions, and orders of Sun insofar as the loading ports, the terminals from which cargo would be received, the quality of the cargo, the quantity of cargo and the discharge ports and terminals including whether cargo would be lightered.
10. Pursuant to the terms of the voyage charter agreement, the vessel loaded a cargo of approximately 55,000 metric tons at Columbia and Aruba.
11. On August 2, 1979, Sun sent a telex, the pertinent part of which states:
Confirming our telecon at 1100 hours today, subject vessel is to proceed to Marcus Hook Anchorage, Marcus Hook, Pennsylvania to lighter maximum 200,000 barrels 1.98 sulphur residual fuel oil loaded at Aruba. Cargo to be lightered is to be taken only from wing tanks No's 1, 2, 4, 6, port and starboard and center tanks No's 1, 3, 5.
12. On August 3, 1979, Sun sent the following telex:
Confirming verbal orders this date. Subject vessel is to proceed to Big Stone Anchorage lightering 50,000 bbls. Then shift to Marcus Hook Anchorage Lightering on additional 150,000 bbls. (a total of 200,000 bbls. to be lightered for Swann's account in the Philadelphia Harbor). The 100,000 bbls. will be lightered per instructions sent to you under telex dated August 2, 1979.
Vessel is then to proceed to Piney Point, Maryland to Stewarts Terminal to discharge remaining cargo, approximately 150,000 bbls. agents at Piney Point, Maryland will be Ramsey-Scarlett.
13. The S.T. Arctic Star followed Sun's directions and discharged cargo at Big Stone Beach Anchorage, Delaware, Marcus Hook Anchorage, Pennsylvania, and Piney Point, Maryland.
14. All cargo was discharged by August 11, 1979 at 0540 hours when the hoses were disconnected at Piney Point, Maryland.
15. Upon receipt of final sailing instructions for the S.T. Arctic Star, on or about August 5, 1979, the owners prepared their statement for freight.
16. Part I, Paragraph F, of the charter provided the method of calculating freight as follows:
F. Freight Rate:
World Scale Two Hundred Fifty (WS250) per ton (of 2,240 lbs. each)
The Sun Diversion Clause and other parts of the charter made clear that freight was payable on the actual voyage performed.
17. In July and August 1979, Big Stone Beach Anchorage was specifically listed as a separate port for the determination of World Scale rates as were Marcus Hook, Pennsylvania and Piney Point, Maryland.
18. L.Q.M. Associates, Inc. was the charter broker used by Sun to make or fix the voyage charter agreement and Fearnley & Egers, Inc. was the charter broker used by Karavel.
19. World Scale is an association of ship brokers that determine the base rates applicable from one location to another and is utilized worldwide by vessel owners and ship charterers.
20. In denying Karavel's claim for a three port discharge based upon the World Scale rates, which listed Big Stone Anchorage as a port, Sun did not consult with L.Q.M. Associates, Inc., but rather interpreted the Sun lightering clause to limit payment to two ports, to the exclusion of Big Stone Beach Anchorage. (Deposition, Robert J. Grasso, N.T. 30-35).
21. Big Stone Beach Anchorage was not designated as a place for the vessel to go as of the date of fixture of the charter agreement between the brokers. (Deposition, Robert J. Grasso, N.T. 36).
22. On August 6, 1979, in the ordinary course of business, L.Q.M. Associates, Inc. forwarded a statement to Sun for ocean freight on the cargo in the amount of $665,808.74.
23. The statement was based upon World Scale rates for two loading ports and three discharge ports.
24. Upon receipt of the ocean freight statement, Sun recalculated it based upon World Scale rates for two discharge ports and forwarded the sum of $652,023.88 to the vessel owner.
25. By telex of September 26, 1979 the owner requested Sun to remit $13,784.86 or the balance of freight due for a three port discharge.
26. Sun replied by telex dated September 26, 1979:
In our calculation of freight rate charterers note that owners have charged us two port loading -- three port discharge. That is Mamonal, Aruba to Big Stone, Marcus Hook and Piney Point. By acceptance of the Sun lightering clause charterer does not consider Big Stone Beach Anchorage chargeable as a port in rate. Charterers base their calculation on two port loading -- two port discharge. Mamonal and Aruba to Philadelphia and Piney Point. We realize shifting charges may occur.
27. By telex of October 9, 1979, the owner advised Sun that under World Scale rates Big Stone Beach Anchorage was a separate port and requested Sun to pay the additional freight.
28. By telex of November 6, 1979, the owner again requested that Fearnley & Egers, Inc. advise them of the status of the outstanding freight.
29. Should the voyage be considered to have three discharge ports, the owner is entitled to additional freight in the sum of $13,784.86.
30. Should the voyage be considered to have two discharge ports, the owner is entitled to shifting expenses computed as follows:
Extra Agency fee and
mileage at Big Stone
Beach Anchorage $ 150.00
Launch Service at Big
Additional Pilotage re 2,242.97 (subject to ver-
shifting expense ification)
Additional Overtime 500.00
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