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Cargo offloaded and placed in warehouse not “delivery” under Carmack Amendment.

April 1, 2017
Starboard Holdings Ltd. and Starboard Cruise Service, Inc. f/u/b/o SAICI v. ABF Freight Systems, Inc., and Sentry Security Services, Inc. n/k/a Electric Guard Dog, LLC, U.S.D.C, S.D. Fl., 2017 U.S Dist. LEXIS 23359

The matter arises from a case filed by the plaintiff against ABF Freight Systems for the theft of Starboard’s high-value watches and jewelry from ABF’s warehouse. Starboard brought an action in state court against ABF and subsequently amended its complaint two times: once to add an additional defendant, and then for breach of bailment, negligence, breach of contract and conversion. ABF filed a motion for summary judgment, arguing that the Carmack Amendment pre-empted Starboard’s state law claims. Starboard argued that the Carmack Amendment did not apply since its watches and jewelry were delivered and, thus, the Carmack Amendment ceased to apply once ABF offloaded the goods into its warehouse and became a warehousemen.

In its analysis, the District Court considered the meaning of delivery in a contract and relied upon the First Circuit’s finding that delivery is effectuated when there is nothing more to be done by the carrier, whether or not the recipient had accepted the goods. In the instant case, ABF argued that the shipment continued to be subjected to the Carmack Amendment because they had not arrived at their destination (and had not delivered). The District Court found that Starboard’s goods were not delivered after reviewing the contract and intent of the parties (there was no written contract; therefore, the court relied upon the bill of lading.) The court determined the intent was that delivery occurred when the goods arrived at the plaintiff’s address. Ultimately, the court granted ABF’s motion and found the Carmack Amendment preempted Starboard’s state law causes of action. Starboard’s failure to plead a cause of action under the Carmack Amendment was detrimental as it was not entitled to any relief.


Case Law Alerts, 2nd Quarter, April 2017

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