Free Confirm Arbitration Award - District Court of California - California

Case 3:07-cv-03220-SC

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LUCAS VALLEY LAW MARK K. de LANGIS (SBN 190083) 2110 Elderberry Lane San Rafael, California 94903 Telephone: (415) 472-3892 Facsimile: (415) 472-3977 [email protected] Attorneys for Petitioners AMERICAN PRESIDENT LINES, LTD. and APL CO. Pte., LTD.

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA

In the Matter of the Arbitration between AMERICAN PRESIDENT LINES, LTD., and APL CO. Pte., LTD. Petitioners, v. D.S.R. SHIPPING CO., INC., a corporation, Respondent.

No. C 07-03220 SC NOTICE OF MOTION AND MOTION TO CONFIRM ARBITRATION AWARD; MEMORANDUM OF POINTS AND AUTHORITIES [9 U.S.C. section 9] Hearing Date: November 16, 2007 Hearing Time: 10:00 Courtroom: 1, 17th Floor

The Honorable Samuel Conti

NOTICE OF MOTION AND MOTION TO CONFIRM ARBITRATION AWARD

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I.

NOTICE OF MOTION TO EACH PARTY AND ITS ATTORNEY OF RECORD: YOUR ARE HEREBY NOTIFIED THAT on November 16, 2007, at 10:00

a.m., or as soon thereafter as the matter may be heard, in Courtroom 1, 17th Floor of this Court, located at 450 Golden Gate Avenue, San Francisco, California, Petitioners American President Lines, Ltd. and APL Co. Pte., Ltd. (collectively "APL") will and hereby do move this Court pursuant to 9 United States Code section 9, for an order confirming the arbitration award in favor of APL and against Respondent D.S.R. Shipping Co., Inc. ("D.S.R."). This motion is based on this Notice; the following Memorandum of Points and Authorities; the accompanying Declaration of Mark K. de Langis; the previously filed Petition for Order Confirming Award of Arbitrator and exhibits thereto; and all argument, oral testimony, and other information introduced at the hearing on this motion.

II.

RELIEF SOUGHT By this motion, APL requests that the Court enter an order confirming the Award of

Arbitrator, in the arbitration between APL and D.S.R. (A true and correct copy the Award of Arbitrator, is attached to APL's Petition for Order Confirming Award of Arbitrator as Exhibit C; filed with the Court on June 19, 2007.) After proper submittal of proof, the arbitration award was executed and served on all parties by the duly appointed arbitrator, Richard J. Collier, Esq., on April 18, 2007. D.S.R. has yet to pay any portion of the award. Accordingly, APL seeks an order confirming the arbitration award and also requests that a judgment be entered in conformity with the terms of the arbitration award.

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III.

POINTS AND AUTHORITIES A. Background

In June of 2003, a service contract1 was entered into between APL and D.S.R. (See Service Contract Number LA02/0103 ("Service Contract"), attached as Exhibit A to APL's Petition for Order Confirming Award of Arbitrator ("Petition"), filed on June 19, 2007.) D.S.R. desired to ship cargo in international commerce from the United States to Latin America. (See Service Contract, Appendix F, ¶¶ 1-3, attached as Ex. A to Petition.) As might be expected, D.S.R. bargained for favorable ocean freight rates for its shipments. In return for providing favorable ocean freight rates on D.S.R.'s shipments, APL demanded a "Minimum Volume Commitment" from D.S.R., so that APL could make up in volume what it gave away in rates on any particular shipment. To this end, D.S.R. agreed to ship a minimum volume of 50 FEUs over the life of the contract, from June 18, 2002 through June 29, 2003. (See Service Contract, App. F, ¶¶ 4 and 8, attached as Ex. A to Petition.) As is common practice in the industry, and in particular, as is common practice by APL, a liquidated damages clause (dead freight) was included in the Service Contract to provide APL with protection, in the event that D.S.R. failed to ship the required number of FEUs. (See Service Contract, p. 3 of 8, § 3(b), attached as Ex. A to Petition.) In the Service Contract, D.S.R. agreed to pay $350 for each FEU "by which the Minimum Volume Commitment exceeds the volume actually tendered." (Service Contract, p. 3 of 8, § 3(b).) Over the course of the contract's term, D.S.R. shipped 8 FEUS, not the 50 FEUs as
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"`[S]ervice contract' means a written contract, other than a bill of lading or a receipt, between one or more shippers and an individual ocean common carrier or an agreement between or among ocean common carriers in which the shipper or shippers makes a commitment to provide a certain volume or portion of cargo over a fixed time period, and the ocean common carrier or the agreement commits to a certain rate or rate schedule and a defined service level, such as assured space, transit time, port rotation, or similar service features. The contract may also specify provisions in the event of nonperformance on the part of any party." 46 U.S.C. app. 1702(19).

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required under the Service Contract. (See Invoice Number COGMD3K441, dated January 19, 2004, attached as Ex. B to Petition.) Accordingly, D.S.R. became obligated to pay dead freight charges on 42 FEUs ($14,700), as per the Service Contract. (See id.) D.S.R. has paid nothing towards the dead freight owed.

B.

THE ARBITRATION

APL and D.S.R. agreed in the Service Contract, at section 4, to resolve any dispute arising under the contract by submitting the dispute to arbitration in San Francisco, California, before an arbitrator of the American Arbitration Association. In addition, APL and D.S.R. agreed that the decision of the arbitrator "shall be final, binding and not subject to further review." (See Service Contract, at p. 4 of 8, § 4(a), attached as Ex. A to Petition.) Pursuant to the arbitration agreement, as detailed in section 4 of the above-described Service Contract, APL initiated arbitration proceedings with the American Arbitration Association ("AAA"). Following due notice to APL and D.S.R., including preliminary hearings by telephone, an arbitration was duly conducted by the AAA appointed arbitrator, Richard J. Collier, Esq., on or about April 4, 2007. On April 18, 2007, the arbitrator, Richard J. Collier, Esq., awarded APL the principal amount of $14,700, attorneys' fees of $2,340, and costs of $1,900, for a total award of $18,940. (See Award of Arbitrator, dated April 18, 2007, attached as Ex. C to Petition.) Section 4 of the above-described contract further provides that the decision of the arbitrator may be enforced by any court, tribunal, or other forum as may properly assert jurisdiction, and that the parties expressly consent and agree that the United States District Court for the Northern District of California shall have personal jurisdiction over the parties to the contract. (See Service Contract, at p. 4 of 8, § 4(b), attached as Ex. A to Petition.) D.S.R. has failed to voluntarily satisfy the arbitration award in the time since it was made. A judgment on the arbitration award is needed to permit APL to enforce it. A

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