News & Noteworthy



Authored - NJ Contract Law Update - Specific Federal Laws Associated With Trucking And Ocean Transit, And Related Jurisdictional Issues
SEPTEMBER 04, 2013 | Windels Marx - Commercial Litigation

On one level, Mitsui O.S.K. Lines, Ltd v. Evans Delivery, ____ F.Supp.2d ___, 2013 WL 2477271 (D.N.J. June 10, 2013), is simply a factual dispute. But on other levels, it provides insight into the relationship between (a) contract, quasi-contract, and contract-substitute claims, on the one hand, and (b) potentially preemptive federal laws on the other hand.

The plaintiff (Mitsui) is a United States entity, based in New Jersey, described as a "Japanese vessel operating common carrier". Mitsui brought goods into the country and hired motor carriers to transport within the United States. The lawsuit arose when Mitsui concluded that the motor carriers appeared to have (a) delivered to closer locations than contracted; but (b) charged 'full freight', so to speak.

Mitsui sued in New Jersey Superior Court "alleging claims for fraud, violations of the New Jersey Consumer Fraud Act, N.J.S.A. 56:8-1 et seq., breach of contract, unjust enrichment, and conversion". The defendant motor carriers removed the case to federal court, claiming that "federal... jurisdiction [existed]...under the Interstate Commerce Commission Termination Act ('ICCTA')." That basis was rejected (for reasons detailed in the Opinion), and the case remanded.

Defendants also invoke two other bases for removal, which the District Court seemed to find facially meritless: diversity of citizenship (the Court said there was none), and jurisdiction under the Carriage of Goods by Sea Act ("COGSA") (the latter did not apply because the inland transportation was not specifically stipulated, by the parties, to be covered by COGSA).

The outcome in Mitsui is not as instructive as its 'invitation' to become familiar with ICCTA and COGSC; and the need to keep in mind that simply because there may be issues under those Acts, there may not be a right to remove to federal court, since certain aspects of such federal issues can be dealt with by the state courts.

Finally, the defendants' decision to file a separate proceeding in federal court on the same subject matter, but in the nature of a declaratory judgment action, did not seem to find favor with the federal court.

The moral of the story is that when dealing with overseas transportation or motor transit, consider the potential applicability of federal laws; but do not assume that applicability (a) is the same as removability, or (b) warrants a separate proceeding.

Contact & Legal Disclaimer

Clark Alpert is the author of Guide to New Jersey Contract Law, published by the New Jersey Institute for Continuing Legal Education, originally published in 2007 and updated in November 2011. His updates on New Jersey contract law are based in recent issues and practical methods for addressing similar situations in your practice or business. They are not intended to serve as legal advice. Clark welcomes your questions and comments.




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