      09-4734-cv
      Shah v. Kuwait Airways Corporation

1                           UNITED STATES COURT OF APPEALS
2                               FOR THE SECOND CIRCUIT

3                                SUMMARY ORDER
4 RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER
5 FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF
6 APPELLATE PROCEDURE 32.1 AND THIS COURT'S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER
7 IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN
8 ELECTRONIC DATABASE (WITH THE NOTATION "SUMMARY ORDER"). A PARTY CITING A SUMMARY ORDER
9 MUST   SERVE   A   COPY   OF   IT   ON   ANY   PARTY   NOT   REPRESENTED   BY   COUNSEL.

10    At a stated term of the United States Court of Appeals for the
11    Second Circuit, held at the Daniel Patrick Moynihan United States
12    Courthouse, 500 Pearl Street, in the City of New York, on the
13    7th day of July, two thousand ten.

14    PRESENT:

15                AMALYA L. KEARSE,
16                ROBERT D. SACK,
17                RICHARD C. WESLEY,

18                             Circuit Judges.

19    --------------------------------------
20     Chetna Harish Shah,

21                         Plaintiff-Appellant,

22                 - v -                                           No. 09-4734-cv

23     Kuwait Airways Corporation,

24                         Defendant-Appellee.

25    --------------------------------------

26    Appearing for Plaintiff-Appellant:          Chetna Harish Shah, Bronx,
27                                                NY, pro se



28    Appearing for Defendant-Appellee:           Michael J. Holland, Condon &
29                                                Forsyth LLP, New York, NY
1         Appeal from a judgment of the United States District Court
2    for the Southern District of New York (Gerard E. Lynch, Judge).

3         UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED AND
4    DECREED that the judgment of the district court be, and it hereby
5    is, VACATED and REMANDED for further proceedings.

 6        Plaintiff Chetna Harish Shah appeals from a decision of the
 7   United States District Court for the Southern District of New
 8   York granting partial summary judgment in favor of defendant
 9   Kuwait Airways Corporation and limiting the amount of the
10   plaintiff's damages to $1,575 on her claim of stolen valuables.
11   Shah v. Kuwait Airways Corp., 653 F. Supp. 2d 499 (S.D.N.Y.
12   2009). The plaintiff alleges that in the course of traveling
13   from India to New York, she changed planes in Kuwait City,
14   Kuwait, where she was required to check a bag that she had
15   intended to carry with her on the plane. She alleges that two of
16   the defendant's Kuwait City employees conspired to steal
17   valuables from the checked bag. When the plaintiff arrived in
18   New York and recovered her bag, she found that it had been ripped
19   open and that valuables were missing from it. The plaintiff
20   seeks $25,000 in damages.

21        For purposes of this appeal, we assume without deciding that
22   the plaintiff's claim arises under the Convention for the
23   Unification of Certain Rules for International Carriage by Air
24   (the "Montreal Convention") rather than the earlier Convention
25   for the Unification of Certain Rules Relating to International
26   Transportation by Air (the "Warsaw Convention"). If the
27   plaintiff's travel began in the United States for return to the
28   United States, the Montreal Convention applies; if she was
29   traveling one-way from India to the United States, then the
30   Warsaw Convention applies. See Shah, 653 F. Supp. 2d at 504.
31   Although the Montreal Convention provides higher limits of
32   recovery and other relative benefits for the traveler, there is
33   no material distinction between the two treaties for purposes of
34   the narrow issue we address here.

35        The Montreal Convention limits "the liability of the carrier
36   in the case of destruction, loss, damage or delay [of baggage] to
37   1000 Special Drawing Rights for each passenger unless the
38   passenger has made . . . a special declaration of interest in
39   delivery at destination and has paid a supplementary sum if the
40   case so requires." Montreal Convention art. 22.2. The plaintiff
41   made no such special declaration here. However, the foregoing
42   provision does not apply where "the damage resulted from an act
43   or omission of the carrier, its servants or agents, done with
44   intent to cause damage or recklessly and with knowledge that
45   damage would probably result; provided that, in the case of such

                                     2
1    act or omission of a servant or agent, it is also proved that
2    such servant or agent was acting within the scope of its
3    employment." Id. art. 22.5.

 4        The district court granted partial summary judgment in the
 5   defendant's favor, limiting the amount of the plaintiff's damages
 6   to $1,5751 under Article 22.2 of the Montreal Convention. See
 7   Shah, 653 F. Supp. 2d at 506-07. The court concluded that "theft
 8   by individual employees does not void the [Montreal] Convention's
 9   limits on carrier liability." Id. at 506. In reaching this
10   conclusion, the court relied on Brink's Ltd. v. S. African
11   Airways, No. 94 Civ. 1902, 1995 WL 225602, at *2, 1995 U.S. Dist.
12   LEXIS 5004, at *4-*6 (S.D.N.Y. Apr. 17, 1995) ("Brink's I"),
13   rev'd, 93 F.3d 1022 (2d Cir. 1996) ("Brink's II"), and the cases
14   collected therein. Shah, 653 F. Supp. 2d at 506. Brink's I, in
15   turn, relied upon one New York State case and two district court
16   cases applying New York law to conclude that theft was outside
17   the scope of employment, and that theft by a servant or agent of
18   a carrier would therefore not trigger the exception to the
19   limitation of a carrier's liability under the Warsaw Convention.2
20   See Brink's I, 1995 WL 225602, at *2, 1995 U.S. Dist. LEXIS 5004,
21   at *4-*6 (citing Rymanowski v. Pan Am. World Airways, Inc., 416
22   N.Y.S.2d 1018, 70 A.D.2d 738 (3d Dep't 1979), aff'd, 49 N.Y.2d
23   834, 404 N.E.2d 1336, 427 N.Y.S.2d 795 (1980); Baker v. Lansdell
24   Protective Agency, Inc., No. 83 Civ. 7577, 1985 WL 3964, 1985
25   U.S. Dist. LEXIS 13599 (S.D.N.Y. Nov. 22, 1985); and Denby v.
26   Seaboard World Airlines, Inc., 575 F. Supp. 1134 (E.D.N.Y. 1983),
27   rev'd on other grounds, 737 F.2d 172 (2d Cir. 1984)); see also
28   id., 1995 WL 225602, at *3, 1995 U.S. Dist. LEXIS 5004, at *6
29   ("[E]very American court to address this issue has held that the
30   willful misconduct exception to the Warsaw Convention's
31   limitation of liability does not apply to acts of theft committed
32   by employees."). The district court in Brink's I did acknowledge
33   that various foreign courts have decided that theft by an air
34   carrier's employee does trigger the exception. See id., 1995 WL
35   225602, at *3, 1995 U.S. Dist. LEXIS 5004, at *6-*7.

36        The district court's decision in Brink's I was, as noted,
37   reversed in part. The basis for the partial reversal was the
38   failure of the district court, in applying the law of the forum

          1
             1,000 Special Drawing Rights were worth "$1575 at the[n]
     current exchange rates." Shah, 653 F. Supp. 2d at 503.
          2
             Brink's I and the cases cited therein involve the Warsaw
     Convention, rather than the Montreal Convention, but as noted in
     the text, supra, there is no material difference between the two
     for purposes of this discussion.

                                     3
1    jurisdiction (there, as here, New York State), "to apply that
2    state's choice of law rules," which would have dictated that
3    "South African law governing employer-employee liability" should
4    have been used to determine whether theft by an air carrier's
5    employees would qualify as misconduct that could be imputed to
6    the air carrier under the Convention. Brink's II, 93 F.3d at
7    1030, 1032.

 8        In this case, the district court did not, at least
 9   explicitly, apply New York's choice of law rules to determine
10   what jurisdiction's law should govern the issue of whether
11   employee theft falls within the scope of employment. It appears
12   not to have analyzed whether, in particular, Kuwaiti law on this
13   subject conflicts with New York law, and if so, whether Kuwaiti
14   law should apply.

15        While, in Brink's II, we conducted the choice of law
16   analysis ourselves and remanded for the district court to apply
17   South African law, see id. at 1030-32, here we think it most
18   prudent to remand for the district court to determine, in the
19   first instance, whether applicable principles of New York and
20   Kuwaiti law do conflict, see United States v. Farr & Co., 342
21   F.2d 383, 386 n.4 (2d Cir. 1965) (where "there is no conflict of
22   laws between the relevant jurisdictions, . . . all choice-of-law
23   questions can best be left unresolved"), and, if so, which law to
24   apply, inasmuch as both inquiries may be fact-intensive, see
25   Comer v. Titan Tool, Inc., 875 F. Supp. 255, 260 (S.D.N.Y. 1995)
26   ("A choice of governing law necessarily depends on factual
27   determinations, not only as a matter of application of a state's
28   choice-of-law formulation, but also as a constitutional matter."
29   (internal citation omitted)).

30        We therefore vacate the judgment and remand   for the district
31   court to determine in the first instance whether   applicable
32   principles of New York and Kuwaiti law conflict,   and, if so,
33   which jurisdiction's law applies to the question   of whether the
34   alleged theft in this case fell within the scope   of employment
35   for purposes of the Montreal Convention.

36        For the foregoing reasons, the judgment of the district
37   court is hereby VACATED and REMANDED for further proceedings.

38                       FOR THE COURT:
39                       Catherine O'Hagan Wolfe, Clerk of the Court



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