Server: Netscape-Enterprise/2.01 Date: Wed, 31 Dec 1997 20:57:13 GMT Content-type: text/html Legal Transportation News Vol. 3 Issue 1

Legal Transportation News

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Compliments of the Law Offices of Charles H. Veigel, P.S., Vol. 3 issue 1
Copyright © 1997, Charles H. Veigel, All Rights Reserved Spring/Summer 1997


"COURT OF APPEALS UPHOLDS U.S. COURT OF INTERNATIONAL TRADE RULING THAT HARBOR MAINTENANCE FEE IS UNCONSTITUTIONAL"

Seattle. June 9, 1997. For those following the appeal of U.S. Shoe v. United States and the constitutionality of the Harbor Maintenance Fee, the June 3, 1997 opinion of the Court of Appeals for the Federal Circuit was a day of mixed results.

On the one hand, the Court handed exporters a victory by upholding the Court of International Trade ruling that the Harbor Maintenance Fee is a tax and violates Art 1, § 9, clause 5 of the United States Constitution providing "No Tax or Duty shall be laid on articles exported from any State."

On the other hand, the Court did not render a ruling on whether all monies collected since the implementation of the Harbor Maintenance Fee should be refunded. The goods news for exporters is that the Court of Appeals upheld the Court of International Trade's jurisdiction pursuant to 28 U.S.C. § 1581 (i). The Government had argued that 28 U.S.C. § 1581 (a) applied requiring that exporters first file a protest and limiting recovery to amounts protested within 90 days of payment. U.S. Shoe argued that the U.S. Court of International Trade had jurisdiction pursuant to section 1581 (i) providing that actions must be instituted within 2 years of the date the cause of action accrued. If the Government was successful in its argument, the U.S. Court of International Trade would not have jurisdiction over U.S. Shoe's complaint and Shoe would not have filed timely protests. The Court's decision appears to suggest that exporters may be entitled to refunds up to two years back from the date of filing lawsuits.

Shippers must now wait and see whether the Government intends to appeal the decision to the U.S. Supreme Court and whether it will elect to hear the case. If so, expect another one to one and a half years before a final decision is rendered.

At the time of writing Customs had not decided whether it intended to collect Harbor Maintenance Fees pending a decision whether to appeal to the U.S. Supreme Court. Shippers should be aware that the Court of Appeals enjoined Customs from collecting the fee.

Last of all, if the Government does not appeal to the U.S. Supreme Court, the questions becomes how to collect refunds. Those who filed lawsuits are in a position to compel payment of the refund. Proving payments made in past years may be difficult for some shippers; it is uncertain whether the Government has kept a records of such payments. When more information is available, we will pass it on.


"NOTICE OF LOSS AND DAMAGE IN INTERNATIONAL AIR TRANSPORT OF GOODS"

Continuing in our series of articles on notice of cargo loss and damage, attention now turns to international air transport and the Warsaw Convention (October 12, 1929, 49 Stat. 3000, T.S. No. 876 (1934), 49 U.S.C. App. Section 1502 (1988 ed)). The Convention requires notice for loss, damage and delay to cargo. If the person entitled to delivery of the goods ("claimant") does not complain to the carrier within the times prescribed by the Convention, no action shall lie against the carrier, except in cases of fraud. (Article 26 (4)).

In the case of damaged goods, a claimant must complain in writing to the carrier within seven (7) days. If the goods are delayed, a claimant must notify the carrier in writing within fourteen (14) days from the date on which the luggage or goods had been placed at the his/her disposal. In the event of cargo loss, the Convention is silent and does not specify a time limitation. Because the Convention is silent on this point considerable litigation has developed. Courts struggled in ascertaining what the Convention drafters meant by the word "loss." Although Courts did define "loss," direct air carriers inserted time limitations periods of 120 days into their tariffs and airway bills regardless. Courts upheld the 120 day limit for loss of cargo finding the time limits as supplementary and not directly in conflict with the Convention. Shippers should be aware that many carriers have inserted even shorter time limitations. See Imtiaz v. Emery Air Freight, 728 S.W.2d 897 (Tex.Civ.App. 1987) in which a notice provision of 25 days was upheld.

In our series of articles on notice of loss and damage, we provided suggestions on the content of written notices to carriers. There are no specific content requirements imposed by the Convention. Note that the complaint to the carrier may be provided on the airway bill or by a separate writing.

Although the issues in notice of cargo loss and/or damage in international transport may appear somewhat elementary, complexities multiply when indirect air carriers/international freight forwarders participate. More specifically, to whom should a claimant submit notice of loss/damage or delay? Although Article 30 does not state whether notice to one carrier (indirect air carrier) constitutes notice to all carriers, it is generally understood that a claimant need not notify all carriers when multiple carriers have either carried the goods or participated, at least, on paper with the movement. Carriers will be held jointly and severally liable to the claimant.


FAA Announces Assessment of Foreign Compliance with the International Civil Aviation's Organizations Aviation Safety Standards (ICAO)

ICAO is a United Nations agency for aviation that establishes standards and makes recommendations for aircraft operations and maintenance. To determine whether a particular foreign country complies with the ICAO standards, check the FAA web site at http://www.faa/gov/avr/iasa.htm. The FAA has enacted three ratings for the status of civil aviation authorities: Category 1- does comply; category 2 - conditional; category 4- Does not Comply with ICAO standards.
Press Release/APA 78-97/Federal Aviation Administration/May 16, 1997


Customs Enforcement Begins June 1

On June 1, Customs will begin enforcing compliance with the handling of export documentation. If you are a maritime carrier, make sure you have the shipper's export declaration in hand before the vessel sails.


Surface Transportation Safety Board Removes Tariff Filing Requirement for NVOCC

The Surface Transportation Safety Board (STB) removed tariff filing requirements after March 29, 1997 for shipments between the U.S. and Alaska, Hawaii and Puerto Rico. The STB resolved a terminology conflict between Federal Maritime Commission (FMC) and former Interstate Commerce Commission (ICC) definitions of carriers for companies that consolidate shipments and take responsibility for moving them on a performing carrier. The Journal of Commerce.


THE UNITED STATES SUPREME COURT HOLDS LOSS OF SOCIETY DAMAGES NOT RECOVERABLE IN WRONGFUL DEATH ACTION UNDER THE WARSAW CONVENTION

The United States Supreme Court in Zicherman et al. v. Korean Airlines Co., 516 U.S. _____, 116 Sup. Ct _______, 133 L.Ed.2d 596 (25 Avi 17,230) (1996) (U.S.S.Ct January 16, 1996) held that loss of society damages could not be recovered under the Warsaw Convention.

The case concerned Korean Airlines Flight KE007 that was shot down straying presumably over Soviet Airspace. All the passengers aboard the airline were killed, including Muriel Kole. Her mother and sister sued Korean Airlines. Following lower and appellate court rulings, the Supreme Court was left to decide whether loss of society damages were recoverable under the Warsaw Convention. Loss of society damages refers to a broad range of mutual benefits each family member receives from each other's existence including love, affection, care, attention, companionship, comfort and protection. (Black's Law Dictionary)

Justice Scalia, writing for the majority, held that the Warsaw Convention did not provide a rule governing the question and the Court would not furnish a rule on the subject. Scalia mentioned that Congress could certainly legislate on the matter. In the absence of a rule of law under the Convention, Article 17 of the Convention authorized the Court to apply law that would rule in the Convention's absence.

Scalia turned to the Death on the High Seas Act, 41 Stat. 537 (1988 ed.), 46 U.S.C. App. § 761 et seq. Section 762 of DOHSA provides that the recovery in a suit "shall be a fair and just compensation for the pecuniary loss sustained by the person for whose benefit the suit is brought." 46 U.S.C. App. § 762. Because only pecuniary losses were recoverable, the Zicherman's were not entitled to recover loss of society damages.


NOL-APL Deal passes FTC scrutiny

The Federal Trade Commission announced that the NOL-APL deal does not pose an antitrust violation under the Hart-Scott-Rodino Antitrust Improvements Act. Journal of Commerce, May 13, 1997.


NAFTA/Trucking - More Problems

The Los Angeles City Council urged President Clinton not to lift restrictions on Mexican trucks that enter the United States. The City Council passed the resolution shortly after a truck driven by a Mexican caused a fatal traffic accident. As you may recall under NAFTA, restrictions on Mexican trucks would be liberalized but was subsequently delayed by the Clinton Administration. The Journal of Commerce April 3, 1997.


France - U.S. Air Treaty

At the end of February, the French Government delivered a new air treaty to the U.S. The U.S. and France have operated without an air treaty since France broke the pact in 1993. Flights are negotiated on a seasonal basis. The Journal of Commerce


New Secretary of Transportation

Rodney Slater was sworn is an Secretary of Transportation replacing Mr. Pena. Mr. Slater served as Arkansas Highway Commissioner before coming to Washington, D.C.


The Legal Transportation News is not engaged in the practice of law. It also does not dispense legal advice. Rather, it provides general advise for general legal situations. If you have a legal problem, contact a competent attorney as soon as possible.

FIRM'S SERVICES:

Law Offices of Charles H. Veigel is a client-centered law firm that provides individualized service to small and medium sized companies. We strive to provide our clients the utmost in competency, communication and common sense to help them avoid legal trouble in both daily management and expansion plans.

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