Tuesday, November 16, 2004

Australian Connection In US Supreme Court Case

The Third Branch has just been made aware of a recent US Supreme Court decision with an Australian connection. The plaintiff-respondent in Norfolk Southern Railway v James N Kirby Pty Ltd was an Australian manufacturer, presumably of refrigeration equipment. O’Connor J gave the judgment of a unanimous Supreme Court. She began by noting that:

This is a maritime case about a train wreck. A shipment of machinery from Australia was destined for Huntsville, Alabama. The intercontinental journey was uneventful, and the machinery reached the United States unharmed. But the train carrying the machinery on its final, inland leg derailed, causing extensive damage. The machinery’s owner sued the railroad. The railroad seeks shelter in two liability limitations contained in contracts that upstream carriers negotiated for the machinery’s delivery.

The issues were (a) whether federal law governed the claim, and (b) whether the Himalaya Clause in the bill of lading succeeded in limiting the railway’s liability. The Supreme Court answered “yes” and “yes”.

So far as The Third Branch is aware, those questions would receive the same answers in Australia: (a) because of the Admiralty Act 1988 (Cth), and (b) because of the decision in Port Jackson Stevedoring Pty Ltd v Salmond & Spraggon (Aust) Pty Ltd (1980) 144 CLR 300.

We at the Third Branch are all landlubbers, so we'd be grateful to hear from any readers who know better.