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CADA v. COSTA LINE

August 25, 1982

JOSEPH J. CADA, ET AL., PLAINTIFFS,
v.
COSTA LINE, INC., ET AL., DEFENDANTS.



The opinion of the court was delivered by: Shadur, District Judge.

MEMORANDUM OPINION AND ORDER

Joseph and Jean Cada ("Cadas") filed this class action against Costa Line, Inc. ("Line") and its parent company, Costa Armatori, S.p.A. ("Armatori"). Judge McGarr (to whom the case was first assigned) then certified a class of all passengers who have claims arising out of the March 30, 1979 fire on one of Armatori's cruise ships, Angelina Lauro. Defendants (collectively "Costas") have now moved for partial summary judgment, claiming each class member's recovery is limited by Articles 20 and 21 of the passage ticket (the "Ticket") to 120,000 Italian lire (about $150). For the reasons contained in this memorandum opinion and order, Costas' motion is denied.

Costas contend a Ticket was timely delivered to each passenger.*fn1 For purposes of this opinion it will be assumed (without deciding) that Articles 20 and 21, if valid and enforceable, would limit Costas' liability as they claim.*fn2 With that assumption, the question posed by Costas' motion is whether the limitation on liability must be given effect as a matter of law.

Because of the approach taken by the leading cases in this area, it becomes important to describe the Ticket in some detail. It is actually a booklet about 8 1/4 inches by 3 1/2 inches. Its cover features the Costa logo and the words "passage ticket" in English and other languages. At the top of page 2, set off in small but still readable boldface type, is the legend:

  Terms and Conditions of contract of passage and
  baggage.

Each of pages 2 through 10 has two columns of printing almost as fine as the printer's art will allow (they appear to be 3- or 4-point type), in Italian on the left and English on the right. They contain 35 articles (Articles 20 and 21 are on page 7). After Article 35 the following sentence appears on page 10, set in the same slightly larger typeface as the all-capitals Article headings (all errors in grammar, punctuation and spelling are in the original document):

  THE HOLDER OF THIS PASSAGE TICKET, DO HEREBY
  DECLARE TO THE EFFECTS AND UNDER PROVISIONS OF
  ARTT. 1341 and 1342 OF THE ITALIAN CIVIL CODE IN
  FORCE, THAT HE IS AWARE AND ADHERES TO ALL
  CONDITIONS AND CLAUSES SET FORTH IN THIS PASSAGE
  CONTRACT AND THAT HE SPECIFICALLY APPROVES
  CLAUSES Nos. 1, 2, 4, 6, 8, 9, 10, 11, 12, 13,
  14, 15, 16, 20, 21, 23, 24, 25, 26, 27, 28, 29,
  30, 32, 33, and 35.

Next is a foldout page containing a passenger declaration form to be filled out and signed by the passenger. It is headed by several "Notices," none of which refers to baggage or the limitation of liability. Nor does any of the questionnaire blanks contain any provision for declaration of excess baggage value (which Article 20 provides as a condition of greater liability for the carrier).

Finally, near the back of the booklet, is the coupon portion of the Ticket. Each of six coupons, identical except for different letter designations, contains the ticket number, the Costa logo and separate blanks for the name of the ship, port of embarkation, date, class of passage, cabin and berth, passenger's name and the fare. In the upper left-hand corner is the following in Italian and English:

  By accepting or using this ticket the passenger
  agrees to the terms and conditions appearing on
  pages 2/10.

Facts such as these have produced two inconsistent lines of authority among the Courts of Appeals (ours has not spoken on the subject) as to the enforceability of liability-limiting clauses. Compare such cases as Silvestri v. Italia Societa per Azioni di Navigazione, 388 F.2d 11 (2d Cir. 1968) and DeNicola v. Cunard Line, Ltd., 642 F.2d 5 (1st Cir. 1981) (both relying on The Majestic, 166 U.S. 375, 17 S.Ct. 597, 41 L.Ed. 1039 (1897)) with cases like Miller v. Lykes Bros. S.S. Co., 467 F.2d 464 (5th Cir. 1972) (distinguishing The Majestic).

But the dominant trend is exemplified by Judge Friendly's opinion in Silvestri. Later decisions have taken even "a more expansive view" of the problem (DeNicola, 642 F.2d at 9), and Judge Will of this District Court applied the Silvestri rule with approval from our Court of Appeals, Hahn v. Norwegian America Line, 1973 A.M.C. 794 (N.D.Ill. 1971), aff'd on the opinion below, No. 71-1398 (7th Cir. Apr. 19, 1972) (unpublished order).

Silvestri itself concluded, 388 F.2d at 17 (emphasis added):

  However, the thread that runs implicitly through
  the cases sustaining incorporation is that
  the steamship line had done all it reasonably could
  to warn the passenger that the terms and conditions
  were ...

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