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Norfolk Southern Railway Co. v. Kirby

United States Supreme Court
543 U.S. 14 (2004)


Facts

James Kirby (plaintiff) contracted with International Cargo Control (ICC) to deliver goods from Australia to Alabama. ICC, which was an intermediary forwarding company, outsourced physical transportation of the goods to Hamburg Sud (Hamburg), a shipping carrier. ICC issued a bill of lading to Kirby, and Hamburg issued a bill of lading to ICC (Hamburg bill). The Hamburg bill incorporated the default rule of the Carriage of Goods by Sea Act, which limited Hamburg’s liability for damages to $500 per package, and also contained a Himalaya Clause. This clause extended the $500 liability limit to Hamburg’s agents and independent contractors. Hamburg hired independent contractor Norfolk Southern Railway Company (Norfolk) (defendant) to transport the goods by train once the shipment arrived in a port in Savannah, Georgia. During transportation en route over land by Norfolk, a train derailment caused $1.5 million in damage to the goods. Kirby brought suit against Norfolk based on tort and contract claims. Norfolk contended that its liability to Kirby was limited by the Hamburg bill. The district court granted partial summary judgment to Norfolk, limiting liability to $500 per package, and certified the decision for interlocutory review. The United States Court of Appeals for the Eleventh Circuit reversed, holding that the Himalaya Clause could not extend limited liability to Norfolk. The United States Supreme Court granted certiorari.

Rule of Law

Issue

Holding and Reasoning (O’Connor, J.)

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