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On May 14, 2002 Sewing Needles and Sayonora enter into a C.
On May 14, 2002 Sewing Needles and Sayonora enter into a C.I.F. Lon Rie ( a country in Southeast Asia) contract for the sale of 1000 sewing machines with payment of $70,000 to be made by letter of credit, choice of Lon Rie law and a delivery date of August 10, 2001. Sewing Needles contracts with a carrier to ship the goods on June 28, 2002 from the port of Philadelphia through the Panama Canal to Lon Rie. The machines, packed eight to a crate, are loaded onto the S.S. Titan on June 27,2002 and the carrier issues a clean, on-board bill of lading for “1000 seqing machines shipped in 125 crates marked Sewing Needles Deluxe Machines”. The Titans sails for the Panama Canal on June 28. On the fourth day, as the Titan approaches the Canal, terrorists detonate bombs causing such extensive damage that the Canal is not navigable. Reports indicate that the Canal should reopen within a week. Rather than make the lengthy and dangerous trip around Cape Horn, the Titan decides to wait in the Caribbean until the Canal is reopened. By July 12, it is clear that the Canal will not reopen until late July. On July 15, the Titan sets sail for Cape Horn. The ship encounters winter storms around the cape, hits a small iceberg and takes on some water. The damage is minor and after a slight delay the Titan continues on its journey. The ship arrives in Lon Rie on August 15, 2002. When Sayonara surrenders the bill of lading, it receives 124 crates of machines, 20 of those crates are water damaged. Because of the missing machines and water damage to 160 machines after loading onto the ship, Sayanora tried to recovered the $11,760 value of the destroyed sewing machines from the carrier, Titan. Titan denied responsibility for the loss and argues that even if it were liable, the law does not obigate it to pay $11,760 for the loss. Decide, thoroughly discussing the arguments of both parties.
