TWA v. Franklin Mint Corp.
466 U.S. 243 (1984)

Annotate this Case

U.S. Supreme Court

TWA v. Franklin Mint Corp., 466 U.S. 243 (1984)

Trans World Airlines, Inc. v. Franklin Mint Corp.

No. 82-1186

Argued November 30, 1983

Decided April 17, 1984*

466 U.S. 243

Syllabus

The Warsaw Convention (Convention), an international air carriage treaty that the United States ratified in 1934, sets a limit on an air carrier's liability for lost cargo at 250 gold French francs per kilogram, which sum may be converted into any national currency. In 1978, Congress repealed the Par Value Modification Act (PVMA), which set an "official" price of gold in the United States. Nevertheless, the Civil Aeronautics Board (CAB) continued to sanction the use of the last official price of gold as a conversion factor. As a result, a $9.07-per-pound limit of liability remained codified in the CAB regulations governing international air carriers' tariffs filed under the Federal Aviation Act of 1958. Franklin Mint Corp. brought suit in Federal District Court against Trans World Airlines (TWA) to recover damages in the amount of $250,000 for the loss in 1979 of packages containing numismatic materials delivered to TWA for transport from Philadelphia to London. The parties having stipulated that TWA was responsible for the loss, the only dispute was the extent of liability. The District Court ruled that, under the Convention, the liability was limited to $6,475.98, a figure derived from the weight of the packages, the Convention's liability limit, and the last official price of gold in the United States. The Court of Appeals affirmed, but also ruled that, 60 days from the issuance of the mandate, the Convention's liability limit would be unenforceable in the United States, since enforcement of the Convention required a factor for converting the liability limit into dollars, and there was no United States legislation specifying a factor to be used by United States courts.

Held:

1. The Convention's cargo liability limit remains enforceable in United States courts, and was not rendered unenforceable by the 1978 repeal of the PVMA. Pp. 466 U. S. 251-253.

(a) Legislative silence is not sufficient to abrogate a treaty. Here, neither the legislative histories of the various PVMA's, the history of the repealing Act, nor the repealing Act itself, make any reference to the

Page 466 U. S. 244

Convention, the repeal being unrelated to the Convention and intended to give formal effect to a new international monetary system. Since the Convention is a self-executing treaty, no domestic legislation is required to give it the force of law in the United States. And neither Congress nor the Executive Branch has given the required notice to other parties to the Convention that the United States planned to abrogate the Convention. To the contrary, the Executive Branch continues to maintain that the Convention's liability limit remains enforceable in the United States. Pp. 466 U. S. 251-253.

(b) When the parties to a treaty continue to assert its vitality, a private person may not invoke the doctrine of rebus sic stantibus to assert that a treaty ceases to be binding when there has been a substantial change in conditions since its promulgation. Accordingly, the erosion of the international gold standard and the 1978 repeal of the PVMA cannot be construed as terminating or repudiating the United States' duty to abide by the Convention's liability limit. P. 466 U. S. 253.

2. A $9.07-per-pound liability limit is not inconsistent with domestic law or with the Convention itself. Pp. 466 U. S. 254-260.

(a) It is clear that such limit does not contravene any domestic legislation, absent any suggestion by Congress when it repealed the PVMA that the CAB should thereafter use a conversion factor different from the official price of gold or that either of the political branches expected or intended the repealing Act to affect the dollar equivalent of the Convention's liability limit. P. 466 U. S. 255.

(b) Tying the Convention's liability limit to today's gold market would fail to effect any purpose of the Convention's framers, and would be inconsistent with well-established international practice. A fixed $9.07-per-pound liability limit represents a choice not inconsistent with the Convention's purposes of setting some limits on a carrier's liability, of setting a stable, predictable, and internationally uniform limit that would encourage the growth of the air carrier industry, and of linking the Convention to a constant value that would keep step with the average value of cargo carried, and so remain equitable for carriers and transport users alike. Pp. 466 U. S. 255-260.

690 F.2d 303, affirmed.

O'CONNOR, J., delivered the opinion of the Court, in which BURGER, C.J., and BRENNAN, WHITE, MARSHALL, BLACKMUN, POWELL, and REHNQUIST JJ., joined. STEVENS, J., filed a dissenting opinion, post, p. 466 U. S. 261.

Page 466 U. S. 245

Official Supreme Court case law is only found in the print version of the United States Reports. Justia case law is provided for general informational purposes only, and may not reflect current legal developments, verdicts or settlements. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or information linked to from this site. Please check official sources.