Hong Kong Container Line Refused to Pay for Document Services, US Company Tells FMC
Hong Kong-based Sterling Container Line violated U.S. shipping regulations when it refused to pay Florida-based SeaFair USA for its “document turnover” services for shipments carried under Sterling’s house bills of lading, SeaFair said in a Dec. 15 complaint to the Federal Maritime Commission. SeaFair said Sterling owes it more than $400,000 and asked the FMC to order Sterling to pay reparations and “cease and desist” from their “unlawful conduct.”
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SeaFair said it was contracted by Sterling and its parent company, Atlantic Forwarding, in May 2021 to handle documents and bills of lading “issued by various branch offices of Atlantic who were acting as agents of Sterling.” Under a contract, SeaFair “collected and/or paid the destination charges related to steamship lines, associated terminals and other logistics companies on behalf of Sterling and its shipping agent, Atlantic,” but both “failed to pay SeaFair document turnover fees it is rightfully owed,” the complaint said.
SeaFair said it tried to resolve the issue with Sterling’s bondholder, but “after negotiations spanning the course of several months, and despite partial payment made to SeaFair by Atlantic, SeaFair and Respondents were unable to reach a settlement,” the company said. SeaFair said Sterling owes it $138,422 under one claim and $321,533.52 for another.
“By knowingly and willfully withholding payment to their destination agent, SeaFair, for monies advanced by SeaFair on behalf of Respondents, Respondents have obtained or attempted to obtain ocean transportation for property at less than the charges that would otherwise apply,” the complaint said.
SeaFair said the unpaid charges will lead to “economic damages that extend beyond SeaFair to include its inability to pay.” The company said it will not be able to pay destination charges for its other clients, “which will result in the loss and/or depreciation of goods for shipments for which SeaFair serves as destination agent.” Along with reparations, the FMC should penalize Sterling and Atlantic at least $25,000 “in light of the willful, intentional nature of their actions.”
Atlantic Forwarding didn’t immediately respond to a request for comment. Sterling couldn’t be reached.