INSURANCE (MARITIME) / Appeals court upheld summary judgment ruling inapplicable to these facts insurance policy language that excluded coverage where either a “carrier for hire” was involved or there had been “loss of and/or theft of documents of title” because (1) a warehouse could NOT be considered a “carrier for hire” under the Carriage of Goods by Sea Act, and (2) purchaser of the freight (cotton) whose agent received bill of lading could NOT be considered to have taken good to which he lacked title (because the bill of lading is – among various things – a document of title).

State National Insurance Co. v. Marketing Services, Inc., No. 12-60148 (U.S. Court of Appeals for the 5th Circuit, May 10, 2013). Copy of court-issued opinion available here

On the first point, defendant purchaser argued that warehouse was a “carrier” under the insurance contract. The insurance contract did not define that term. And the 5th Circuit had ruled under the former version of the Carriage of Goods by Sea Act that a “carrier” was “the owner or the charterer who enters into a contract of carriage with a shipper”, and under the more recent version that a “carrier” was “the owner, manager, charterer, agent, or master of a vessel”.

The court ruled that the warehouse here met neither version of the definition of “carrier”. 

On the second point, relating to “theft of documents of title” – there could have been no theft from defendant since the defendant’s agent had been delivered the bill of lading. Among various functions, a bill of lading is a document of title. Hence there could have been no “theft” where the holder of the freight was in possession of the bill of lading.