Allianz Versicherungs, AG v. Profreight Brokers, Inc. (5^th Circuit, 2004)
Author: Krista

Facts: Plaintiff/Appellant Allianz shipped goods under a contract with defendant/appellee Profreight that limited the liability of Profreight to fifty dollars. On appeal Allianz argued that it was entitled to a judgment for the actual value of the damage to the goods.

Procedure: Allianz appeals from a judgment limiting its recovery from Profreight to fifty dollars based on contractual limitation of liability. Allianz asserted that Profreight waived its contractual limitation of liability defense because it did not plead it as an affirmative defense pursuant to Fed.R.Civ.P.8 (c). The trial judge said the defense was not waived because Allianz was not prejudices by it.

Issue: Whether the trial court erred by finding Profreights’s failure to plead limitation of liability as an affirmative defense did not result in a waiver.

Rule: Fed.R.Civ.P.8 (c): Parties must plead all affirmative defenses, and it is well established that failure to follow this rule generally results in a waiver. The exception though is where the matter is raises in the trial court in a manner that does not result in unfair surprise. In that case, technical failure to comply precisely to Rule 8c is not fatal.

Holding: The trial court did not err. The defense was not waived.

Reasoning: The fact that Allianz had three months to prepare for the limitations defense and adequate time after judgment to move to alter or amend the judgment refutes Allianz’s assertion that it was prejudicially surprised.