## Facts

- A vessel owner time-chartered the M/V Sea Phoenix to a charterer under a form providing that COGSA exemptions would apply and that COGSA clauses would be included in bills of lading.
- The charterer loaded 402 galvanized steel coils in Tunisia for carriage to the United States and issued CONGENBILL-form bills of lading.
- The bills used a General Paramount Clause referencing the Hague Rules “as enacted in the country of shipment,” but did not include an express U.S. Clause Paramount or other explicit COGSA language contemplated by the charterparty.
- The cargo was discharged in New Jersey; the consignee alleged 280 coils were damaged in transit.
- The consignee sued the vessel and related parties for cargo damage, asserting contractual and tort theories.
- Defendants sought partial summary judgment limiting liability to $500 per package under COGSA § 4(5).
- The consignee argued that Tunisian law (allegedly implementing the Hamburg Rules) applied via the paramount clause, and that COGSA’s limitation was unenforceable absent a “fair opportunity” to declare higher value.
- The district court applied COGSA and enforced the $500-per-package limitation; the consignee appealed.

## Issues

1. Whether the bills of lading, through the General Paramount Clause, incorporated Tunisian law (Hamburg Rules) or instead applied U.S. law (COGSA) as the relevant enactment of the Hague Rules.
2. Whether COGSA’s $500-per-package limitation is unavailable unless the carrier proves the shipper had a “fair opportunity” to declare a higher value.

## Decision

- The Third Circuit affirmed the partial summary judgment limiting liability under COGSA § 4(5).
- The court held COGSA governed because the paramount clause referred to the Hague Rules regime, and the consignee did not adequately establish the content and applicability of Tunisian law.
- The court held the “fair opportunity” doctrine is inconsistent with COGSA’s text and does not bar application of the statutory limitation.
- Because no higher value was declared and inserted in the bills of lading, the $500-per-package limit applied.

## Legal Principles

- A general paramount clause referencing the Hague Rules “as enacted in the country of shipment” is read as invoking the Hague/Hague-Visby framework, not the Hamburg Rules absent clear contractual language.
- A party invoking foreign law must provide sufficient materials to permit supportable findings of that law; courts may decline to apply foreign law when inadequately presented.
- When the relevant foreign enactment is not adequately shown under the contract’s choice mechanism, the clause may direct application of the corresponding law of the destination country, which in the United States is COGSA.
- Under COGSA § 4(5), the $500-per-package limitation applies unless the shipper declares the nature and value before shipment and inserts it in the bill of lading.
- The “fair opportunity” doctrine is not a prerequisite to invoking COGSA’s limitation in the Third Circuit.

## Conclusion

The Third Circuit applied COGSA to the bills of lading and enforced COGSA’s $500-per-package limitation, holding that foreign law was not adequately established and that carriers need not prove a separate “fair opportunity” for shippers to declare higher value beyond the statutory mechanism in § 4(5).


Ferrostaal, Inc. v. M/V Sea Phoenix, 447 F.3d 212 (3d Cir. 2006)