Clevo Co. v. Hecny Transp., Inc.

Guarantees with no express statute of limitations can place a seller and freight forwarder in direct contractual privity however, a statute of limitations in the bills of lading may bar recovery.

Clevo Co., a Taiwan-based computer part manufacturer, agreed to sell millions of dollars worth of parts to Amazon, a Brazilian entity. The Hecny Shipping Group was to handle the shipments. In the original action, Clevo complained of an improper shipment by Hecny Shipping’s agent, Hecny Transportation. The district court granted summary judgment due to a one-year statute of limitations. The Ninth Circuit held that while contractual privity had been created, the Terms and Conditions of the bills of lading modified the relationship by stating that Hecny Transportation’s liability was terminated if suit was not brought within one year. Further, while Section 21 of the Terms and Conditions only expressly protected Hecny Shipping, the Himalaya Clause extended this protection to Hecny Transportation. Because the claim was not brought within one year, the district court’s grant of summary judgment was affirmed. AFFIRMED.