Alpine Ocean Seismic Survey, Inc. v. F.W. Myers & Co., Inc.

United States Court of Appeals,

Fifth Circuit.

No. 93-2122.

ALPINE OCEAN SEISMIC SURVEY, INC., Plaintiff-Appellant,

v.

F.W. MYERS & COMPANY, INC., et al., Defendant,

Federal Express Corporation, Defendant-Appellee.

June 24, 1994.

Appeal from the United States District Court for the Southern
District of Texas.

Before REAVLEY and JOLLY, Circuit Judges, PARKER,* District Judge.

E. GRADY JOLLY, Circuit Judge:

The plaintiff contracted with an intermediary to have certain

time-sensitive items shipped. The intermediary contracted with the

defendant to ship the items. When the defendant did not deliver

some of the items on time, the plaintiff sued the defendant for

damages caused by the late delivery. Because we find that the

defendant owed no duty to the plaintiff with whom it did not

contract, we affirm the district court's grant of summary judgment

to the defendant.

I

Alpine Ocean Seismic Survey, Inc. ("Alpine") took samples

containing microorganisms from the ocean floor in the Gulf of

Mexico. An employee of Alpine took ten boxes of samples to F.W.

Myers and Company ("Myers") on July 5, 1988, and instructed Myers

*
Chief Judge of the Eastern District of Texas, sitting by
designation.

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to ship them from Houston, Texas, to Gunnison, Colorado, by

overnight air freight for arrival on July 6. Myers contracted with

Federal Express Corporation ("Federal Express") to carry the

shipment. Six of the boxes arrived on July 8, and the remaining

four boxes arrived on July 11. By the time the last four boxes

arrived in Colorado, many of the microorganisms were dead rendering

the samples useless. Alpine sued Federal Express for damages

resulting from having to take new samples.1

The shipping contract contained on the airbill was between

Myers and Federal Express—not between Alpine and Federal Express.

The airbill contained the following standard limitation of

liability clause:

DAMAGE OR LOSS

We are liable for no more than $100 per package in the
event of physical loss or damage, unless you fill in a higher
Declared Value to the left and document higher actual loss in
the event of a claim. We charge $.30 for each additional $100
of declared value up to the maximum shown in our Service
Guide. Declared value restrictions are shown on the back of
the Sender's Copy of this airbill. We make no expressed or
implied warranties.

The district court granted Federal Express's motion for

summary judgment. Alpine brought this appeal.

II

We review the district court's grant of summary judgment de

novo. Johnston v. City of Houston, 14 F.3d 1056, 1059 (5th

Cir.1994). Alpine asserts on appeal that Federal Express owed

Alpine a duty to deliver the boxes in a timely manner, and that the

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Alpine settled its suit with Myers, and Myers is not a
party to this appeal.

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limitation of liability clause is void under the Texas Deceptive

Trade Practices-Consumer Protection Act ("DTPA"). To prevail on

its claim for damages, Alpine must establish that Federal Express

owed a duty to Alpine in contract or in tort and that federal law

does not preempt the DTPA. Because we find that Federal Express

owed no duty to Alpine, we do not reach the preemption issue.

The Eighth Circuit's decision in Hampton v. Federal Express

Corp., 917 F.2d 1119 (8th Cir.1990), is instructive in the instant

case. In Hampton, 917 F.2d at 1120-21, a hospital contracted with

Federal Express to ship blood samples. When the blood samples did

not arrive, a patient died. Id. at 1121. The parent of the

deceased patient sued Federal Express. Id. The airbill in Hampton

contained the same limitation of liability language as the airbill

in the instant case.

The Eighth Circuit held that the parent could not recover in

contract because he was not a party to the contract, and, thus,

Federal Express owed him no duty under the contract. Hampton, 917

F.2d at 1123-24. The Hampton Court held that even if the parent

could sue as a third-party beneficiary of the contract, it could

not recover because Federal Express was unaware of the contents of

the package and thus any damages were not "reasonably foreseeable."

Id. at 1124 (citing Restatement (Second) of Contracts § 351(1)

(1981)). Similarly, there was no duty to the parent in tort

because Federal Express was unaware of the contents of the package

and thus could not reasonably foresee any injury to the parent or

his child. Id. at 1124-25 (citing Palsgraf v. Long Island R.R.,

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248 N.Y. 339, 162 N.E. 99 (1928); Restatement (Second) of Torts §

281 comment c, illustration 1 (1965)). We find this reasoning

compelling.

In the instant case, Federal Express was unaware of the

contents of Alpine's boxes. Accordingly, Federal Express could not

reasonably foresee the necessity of Alpine having to go back to the

bottom of the ocean floor to retrieve further samples if the boxes

were delivered late. Further, even if Alpine was a third-party

beneficiary of the contract, it would still be subject to the

limitation of liability clause because a third-party beneficiary

takes no greater rights than the original contracting party—Myers.

See Avatar Exploration, Inc. v. Chevron, U.S.A., Inc., 933 F.2d

314, 318 (5th Cir.1991). Similarly, Federal Express owed no duty

to Alpine in tort because it could not reasonably foresee the risk

of harm to Alpine from the late delivery of boxes when it had no

knowledge of the contents of the boxes. See Restatement (Second)

of Torts § 281 comment c, illustration 1 (1965). Accordingly, we

will not hold Federal Express liable to a party with whom it did

not contract for damages it could not reasonably foresee.

Consequently, we need not reach the issue of whether federal law

preempts the DTPA.

III

For the reasons stated above, the judgment of the district

court is

AFFIRMED.

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