Petition — Tug Ocean Prince, Inc. v. United States

Supreme Court brief1979

Ask Donna

What actually matters in this document.

Text

78 ive ] 0 ] v4 Bae +mn Court. v. §.

DEC 22 197¢

IN THE MICHAEL AGE AL oP.

Supreme Court of the Wittied States eo

Octoser Term, 1978

No.

TUG OCEAN PRINCE, INC. and RED STAR

TOWING & TRANSPORTATION CO.,

Petitioners,

UNITED STATES OF AMERICA, and

PITTSTON MARINE TRANSPORT CORP.,

Respondents.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS FOR THE

SECOND CIRCUIT

NicHoutas J. HeAty

Attorney for Petitioners

29 Broadway

New York, New York 10006

(212) 943-3980

Hearty & Baume

Wiuuum F. Loseuapro

Joun D. KimBau

Of Counsel

TABLE OF CONTENTS

PAGE

Opinions BeLow = 2

J URISDICTION 2

QuESTIONS PRESENTED nl 2

Statutory Provisions LNvoLvep he 3

STATEMENT OF THE CASE

REASONS FOR GRANTING THE WRIT

ConcLusION aa

APPENDIX:

A—Court of Appeals Decision A-1

B—District Court Decision . i

C—33 U.S.C. $1821(g) ....... C-1

D—Order of Court of Appeals Denying Peti-

tion for Rehearing D-1

E—Judgment Order of United States Court of

Appeals for the Second Cireuit -........2........ E-1

Cases Cited

American Airlines v. Ulen, 186 F.2d 529 (D.C. Cir.

paint RR De eR OA 13, 14

Askew v. American Waterways enn 411 U.S.

325 (1973) a)

Burgess v. M/V Tamano, 564 F.2d 964 (1st Cir.

1977), cert. denied, 98 S.Ct. 1520 (1978) -............... 9

ii TABLE OF CONTENTS

PAGE

Coryell v. Phipps, 317 U.S. 406 (1943) wooed, 22

Craig v. Continental Ins. Co., 141 U.S. 638 (1891) ....16, 20,

Deslions v. La Compagnie Generale Transatlantique,

(La Bourgogne), 210 U.S. 95 (1908) 2 22

Koninklijke Luchtvaart Maatschappij N.V. KLM v.

Tuller, 292 F.2d 775 (D.C. Cir. = cert. denied,

368 U.S. 921 (1961) deie sents aliekatiiipetiician 14

Matter of Steuart Transportation ecabiaae 435 F.,

Supp. 798 (E.D. Va. 1977), appeal pending Docket

Nos. 77-2476 and 77-2477 (4th Cir.) 22.02... cccecececeeesees 12

Pekelis v. Transcontinental & Western Air, 187 F.2d

122 (2d Cir, 1951), cert. denied, 341 U.S. 951

(1951) .~ a

Rowe v. Gatke Corporation, 126 F.2d 61 (7th Cir.

1942), appeal dismissed, 317 U.S. 702 14

Spencer Kellogg & Sons v. Hicks, 285 U.S. 502

(1932) 20

ame LMGy Fike, GB UG. 1 (UGTA) ann ccececccceevescccscerecccoees 24-26

The Pennsylvania, 86 U.S. 125 (1874) ..... 19

The Temple Bar, 137 F.2d 293 (4th Cir. 1943) ....22, 24, 25

The 84-H, 296 F. 427 (2d Cir. 1928) ...... 22

United States v. Hamel, 551 F.2d 107 (6th Cir.

EE . iaitaletiinsachdapianceninvedibntanidlbbantshtucininiiitlbnibennenanadeai Maso: 11,12

Constitutional Provisions, Statutes and Rules Cited

Article ITI, Section 2, Clause 8 ......ccccccccoccccesecsesccsoscesee 2

TABLE OF CONTENTS iil

PAGE

28 U.S.C.:

See. 1254(1) . sebatpidelieesediiecladiddlbleiateeniteiiuional

PE TIE dailiindetateniesidiititaatadesissiiansigiasetenababantisione

OG, FOE sccccininsmntevens 2

33 U.S.C.:

i I saictoncieschrensesiiorssnivensinsdetetiensiinpnectastaiatsnnentes 11,12

Sec. 13821 ............ CLIO RE 3, 4, 8, 9, 11, 12, 16, 18

46 U.S.C.:

PN TID eibiatctinsisoccethsnccsinneienmnerinctelecnninsdiibieonctitl 4, 8, 16, 20

Sec. 742 Scaleaiaieis insiiicuieaaiadintbeiets 2

ey Gai Es Sascenanintettinecnstcimsensineintatnnetsanneninnien 2

Conventions Cited

Warsaw Convention, 49 Stat. 3000, Art. 25(i) ....9, 10, 11, 15

Other Authorities Cited

3 Benedict on Admiralty Sec. 42 (1975) cece 16, 21

Statement of Senator Cooper, March 24, 1969, in 3

Environmental Protection Agency, Legal Compila-

SR I OUD eo inddacameneinniaaivtiniensenissictebeianmeetiinensipatvi 17

Statement of Representative Cramer, March 25,

1969, in 3 EPA, Legal Compilation 1981 (1973) ..17,18

Statement of Senator Muskie, March 24, 1970, in 3

EPA, Legal Compilation 1964 (1978) 2.2.0... 10

iv TABLE OF CONTENTS

PAGE

Statement of Representative Roth, March 25, 1969,

in 3 EPA, Legal Compilation 1995 (1978) .....00...... 18

H.R. Rep. No. 91-127, 91st Cong., Ist Sess. (1969) 18

H.R. Rep. No. 91-940, 91st Cong., 2d Sess. (1970) ..16,18

H.R. Rep. No. 92-911, 92nd Cong., 2d Sess. (1972) 18

S. Rep. No. 91-351, 91st Cong., Ist Sess. (1969) 18

S. Rep. No. 92-414, 92nd Cong., zd Sess. (1971) 18

S. Rep. No. 92-1236, 92d Cong., 2d Sess. (1972) 18

Supreme Court of the United States

Octroprer Term, 1978

No.

TUG OCEAN PRINCE, INC. and RED STAR

TOWING & TRANSPORTATION CO.,

Petitioners,

Vv.

UNITED STATES OF AMERICA, and

PITTSTON MARINE TRANSPORT CORP.,

Respondents.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS FOR THE

SECOND CIRCUIT

To the Honorable the Chief Justice and the Associate

Justices of the Supreme Court of the United States:

Petitioners Tug Ocean Prince, Inc. and Red Star Towing

& Transportation Co, pray that a Writ of Certiorari issue

to review the decision of the United States Court of

Appeals for the Second Circuit entered in this cause.

Opinions Below

The opinion of the Court of Appeals has not yet been

officially reported, but is reported unofficially at 1978

A.M.C. 1786, and is printed in the Appendix, (A-1). The

opinion of the United States District Court for the South-

ern District of New York is reported at 436 F.Supp. 907,

1978 A.M.C. 1806 and is printed in the Appendix, (B-1).

Jurisdiction

The jurisdiction of the District Court was invoked pur-

suant to the Admiralty Clause of the Constitution (Article

IIT, Section 2, Clause 3); 28 U.S.C. § 13833 (1970); FR.

Civ.P., Rule 9(h); 46 U.S.C. § 183-89 (1970) and 46 U.S.C.

§ 742 (1970).

The judgment of the Court of Appeals was entered

August 7, 1978, (1-1). A petition for rehearing with a

suggestion for a hearing in bane was filed by Petitioners

on August 21, 1978, and was denied September 26, 1978,

(D-1).

The jurisdiction of this Court to review the judgment

in question is based on 28 U.S.C, §§ 1254(1) and 2101(e),

Questions Presented

Whether, in reversing the District Court, the Court of

Appeals erred:

1. In denying limitation of liability to $100 per ton of

the gross tonnage of the Tug Ocran Prince for the Gov-

ernment’s costs of cleaning up oil that the Tug caused to

be discharged from a barge in tow of that vessel, as pro-

vided in the Federal Water Pollution Control Act, as

amended, 33 U.S.C. § 1821 (Supp. II 1977), by applying

to the statutory exception to the right of limitation under

that Act a definition of “willful misconduet” at variance

with the definition of that term given to it by the United

States Court of Appeals for the District of Columbia and

Sixth Cireuits, and by the United States District Court

for the Kastern District of Virginia;

2. In denying limitation of liability to the value of the

Tug and the earnings of the trip on which it was engaged

for the damage to the Barge and the loss of the oil dis-

charged, as provided in the Limitation of Liability Act,

by applying to the statutory exception to the right of

limitation under that Act an interpretation of “privity and

knowledge” at variance with the decisions of this Court,

as well as the lower federal courts?

Statutory Provisions Involved

The first question presented involves the correct inter-

pretation and application of the section of the Federal

Water Pollution Control Act, (“Pollution Act’) 83 U.S.C,

§ 1321 (Supp. Il 1977),' which at the material times pro-

vided, inter alia:

(g) In any case where an owner or operator of a

vessel * * * from which oil or a hazardous substance

is discharged in violation of subsection (b)(2) of this

section, proves that such discharge of oil or hazard-

ous substance was caused solely by an act or omis-

'The Clean Water Act of 1977, 33 U.S.C. § 1521(g¢) (Supp.

1978), increased the per ton limit to $150 and removed the 14 mil-

lion “ceiling”.

sion of a third party, or was caused solely by such

an act or omission in combination with an act of

God, an act of war, or negligence on the part of the

United States Government, such third party shall,

notwithstanding any other provision of law, be liable

to the United States Government for the actual costs

incurred under subsection (ce) for removal of such

oil or substance by the United States Government,

except where such third party can prove that such

discharge was caused solely by (A) an act of God,

(B) an act of war, (C) negligence on the part of

the United States Government, or (D) an act or

omission of another party without regard to whether

such act or omission was or was not negligent, or

any combination of the foregoing clauses [sic]. If

such third party was the owner or operator of a ves-

sel which caused the discharge of oil or a hazardous

* substance in violation of subsection (b)(2) of this

section, the liability of such third party under this

subsection shall not exceed $100 per gross ton of

such vessel or $14,000,000, whichever is the lesser.

** * Tf the United States can show that the dis-

charge of oil or a hazardous substance in violation

of subsection (b)(2) of this section was the result of

willful negligence or willful misconduct within the

privity and knowledge of such third party, such third

party shall be liable to the United States Govern-

ment for the full amount of such removal costs. * * *

The complete text of Section 1521(g) is set out in

Appendix C.

The second question presented involves the proper in-

terpretation and application of the Limitation of Liability

Act, 46 U.S.C. § 188(a), which provides:

4183. Amount of liability; loss of life or bodily in-

jury; privity imputed to owner; “seagoing

vessel”

(a) The liability of the owner of any vessel,

whether American or foreign, for any embezzlement,

loss, or destruction by any person of any property,

goods, or merchandise shipped or put on board of

such vessel, or for any loss, damage, or injury by

collision, or for any act, matter, or thing, loss, dam-

age, or forfeiture, done, occasioned, or incurred,

without the privity or knowledge of such owner or

owners, shall not, except in the cases provided for

in subsection (b) of this section, exceed the amount

or value of the interest of such owner in such ves-

sel, and her freight then pending.

Statement of the Case

On February 3, 1974, the Barge New Lonpon, fully

loaded with oil and in forward tow of the Tug Ocran

Prince, ran aground on a submerged rock formation in

the Hudson River. The Barge was damaged, causing oil

to escape into the river, and pollution clean-up operations

were undertaken by the Coast Guard.

Petitioners Tug Ocean Prince, Ine. and Red Star Tow-

ing & Transportation Co. (hereinafter collectively referred

to as “Red Star’), as Owner and Charterer of the Ocran

Prince, commenced an action for exoneration from or

limitation of liability. A claim was filed by Respondent

Pittston Marine Transport Corporation (“Pittston”) for

damage to the Barge and loss of its oil cargo. Suhse-

quently, the Government commenced an action against Red

Star and Pittston to recover its pollution removal ex-

penses. The two actions were consolidated for trial.

The Baree had been taken in tow on February 2nd at

Bayonne for a trip up the Hudson to Kingston. The tug

was fully manned with a crew of six, including two navi-

gators, John Kiernan and Walter Reimer. Reimer had

been a tug captain for five years and was licensed by the

Coast Guard as operator of uninspected towing vessels,

such as the Ockan Prince, on the inland waters, including

the Hudson. Reimer had not navigated the Hudson be-

fore, although he had served as a deckhand on tankers on

that river. He had been employed as a member of the

permanent crew of the Ocean Prince for about 14% years.

Kiernan was also licensed by the Coast Guard and had

more than 30 years experience as a tugboat captain on

the Hudson. He was employed by a company associated

with Red Star, whose dispatchers worked from the same

office as Red Star’s dispatchers, and had been temporarily

assigned to the Ocean Prince to fill a vacancy. Kiernan

had boarded the Tug on February 1st. Reimer had been

on vacation prior to the trip in question, and had rejoined

the Tug on February 2nd.

On February 1st, Red Star had received an order from

Pittston for a tug to tow the Barge New Lonnon to King-

ston over the weekend. The order was entered on a job

card, which was sent to the dispatcher’s office. On Febru-

ary 2nd, Red Star was advised that the Barge was ready,

and its night dispatcher, Philip Keenan, assigned the

Ocean Prince to do the job. Keenan was aware of the

make-up of the pilothouse crew of the Ocean Prince, and

had been told by the day dispatcher that Kiernan was

captain and Reimer was mate. Although he knew of

Reimer’s lack of experience as a navigator on the Hudson,

Keenan decided that the Ockan Prince was suitable for the

trip, since Reimer was a tug captain of proven ability and

Kiernan was on board and would be available to assist

whenever necessary.

Peete re re eee ~~

At trial, Kiernan expressed some doubt in his own mind

that he had been designated captain for the trip. Keenan

did not discuss with Kiernan or Reimer who was to be

captain and who was to be mate, but understood from the

day dispatcher that Kiernan had heen designated captain.

The District Court found that despite Kiernan’s professed

doubt as to the chain of command, he oceupied the cap-

tain’s cabin, stood the captain’s watch, and performed

administrative tasks which were the captain’s responsi-

bility, including preparation of the payroll record, in

which Kiernan designated himself as “captain” and Reimer

as “alternate captain”.

On the trip to Kingston, Kiernan and Reimer stood

alternating six hour watches, with a deckhand assigned to

each watch to assist the navigator and serve as lookout if

required. Kiernan was on watch when the Tug and Barge

left Bayonne at 7:15 P.M., and was relieved by Reimer at

11:30 P.M. At about 11:45 P.M., Kiernan went to the

captain’s quarters behind the pilothouse.

Shortly after 0100 hours on February 3rd, as the Tug

and Barge passed under Bear Mountain Bridge, the tide

was ebbing and visibility was about two miles. The tug’s

radar was operating, and the navigation chart for the area

was out and in use. Reimer was fully aware that a sub-

merged rock formation lay about 134 miles ahead and that

it was marked by a black can buoy. As the Tug passed

Mystery Point about one mile north of the bridge, Reimer

became concerned because he had not spotted the buoy

either on radar or visually. He therefore reduced speed,

and turned on the Tug’s powerful spotlight to search for

the buoy. Shortly afterwards, the Barge’s port bow struck

the rock.

Kiernan came to the pilothouse immediately. The Dis-

trict Court found that regardless of whether he was cap-

tain or mate for the voyage, Kiernan would have come to

the pilothouse to assist Reimer at any time before the

grounding if he had been asked to do so.

The District Court found that “the proximate and pre-

dominant causes of the grounding were errors in naviga-

tion on the part of Reimer’; that these errors were in

turn the result of an error in management on board the

Tug, ie., that Reimer failed to request assistance from

Kiernan when he became uncertain as to the Tug’s posi-

tion; that Reimer’s failure to post a lookout did not con-

tribute to the grounding (B-25); and that the causes of

the grounding were not within the privity and knowledge

of any managing officers of Red Star. (B-13, 17, 22-23,

25-26).

Accordingly, the District Court held that Red Star, while

liable, was entitled to limitation of its liability to Pittston

to the value of the Tug and the earnings of the trip

under the Limitation of Liability Act, 46 U.S.C. § 183,

and to limit its liability to the Government for pollution

clean-up costs to $100 per ton of the Tug’s gross tonnage

under the Pollution Act, 33 U.S.C. § 1821. (B-41).

On appeal, the Court of Appeals reversed the District

Court, holding that Red Star was not entitled to limitation

of its liability to Pittston, and that the Government was

entitled to recover the full amount of its pollution clean-up

costs under the Pollution Act.*

* Emphasis throughout has been added.

3’The Court of Appeals affirmed the District Court’s dismissal of

claims by Red Star and Pittston against the Government for negli-

gence in the maintenance of aids to navigation in the area of the

grounding. The issues involved in the appeal from these dismissals

are not raised in this Petition for a Writ of Certiorari.

Reasons for Granting the Writ

In holding that the grounding of the Barge was the

result of “willful misconduct within the privity and knowl-

edge” of Red Star under the Pollution Act, the Court of

Appeals has adopted an erroneous interpretation of the

Act which seriously undermines the intent of Congress and

conflicts with decisions of other Courts of Appeals under

the Act, as well as the Warsaw Convention, 49 Stat. 3000,

Article 25(1), governing limitation of liability for air-

eraft casualties. Both in its interpretation of the statu-

tory language involved and its statements as to the public

policy underlying the Pollution Act, the Court of Appeals

has plainly misconceived the intent of Congress. If the

decision below were allowed to stand, it would establish a

basis of liability for water pollution clean-up costs never

contemplated by Congress. The issues are therefore of

great importance, and should be settled by this Court.

The legislative history and express language of the

Pollution Act leave no doubt that Congress intended the

comprehensive liability scheme for the recovery of the

Government’s oil spill clean-up expenses embodied in the

Act to be based upon the principle of limitation of lia-

bility. See Askew v. American Waterways Operators, 411

U.S. 325, 330 (1973); Burgess v. M/V Tamano, 564 F.2d

964, 981 (1st Cir. 1977), cert. denied, 98 S.Ct. 1520 (1978).

Under the Act, the owner of a vessel from which oil is

discharged is strictly liable for the Government’s clean-up

expenses unless he can show that the discharge was the

result of an act of God, an act of war, negligence of the

United States, or an act or omission of a third party. 33

U.S.C. § 1321(f). Where, as here, he shows that the dis-

charge was caused by an act or omission of a third party,

the Government is entitled to recover its clean-up costs

from the third party. The amount of the Government’s re-

covery, whether from the discharging vessel or from a

vessel owned by a third party, is expressly limited, how-

ever, to amounts which Congress, after many hearings

and much deliberation, concluded would be insurable. See,

e.g., Statement of Senator Muskie, Mareh 24, 1970, in 3

IXPA, Legal Compilation 1964 (1973).

Thus, the Act provides that the owner of the discharg-

ing vessel, or a third-party owner of a vessel causing the

discharge, as the case may be, who is liable for the Gov-

ernment’s clean-up expenses, is entitled to limit his lia-

bility to $100 per ton of the vessel’s gross tonnage. This

right of limitation of liability exists in all cases, except

where the Government can show that the oil spill was the

result of “willful negligence or willful misconduct within

the privity and knowledge” of the owner of the respon-

sible vessel, in which case the Government may recover

the full amount of its removal costs.

Thus, two elements are necessary before the Govern-

ment is entitled to “break” limitation: (1) it must prove

“willful negligence or willful misconduct”, and (2) it

must prove that such “willful negligence or willful mis-

conduct” was within the privity and knowledge” of the

party responsible.

In the present case, the Court of Appeals concluded that

the oil spill was the result of “willful misconduct”, and

held Red Star liable for the full amount of the Govern-

ment’s clean-up costs. Because “willful misconduct” is not

defined in the Pollution Act, the Court of Appeals applied

its own definition, formulated in cases involving the War-

saw Convention. As stated by the Court:

In those eases arising under the Warsaw Conven-

tion, this cireuit has established the following eri-

teria for a finding of willful misconduct: an act, in-

tentionally done, with knowledge that the perform-

ance will probably result in injury, or done in such

a way as to allow an inference of a reckless disre-

gard of the probable consequences. Pekelis vy. Trans-

continental & Western Air, 187 F.2d 122 (2d Cir.),

cert. denied, 341 U.S. 951 (1951). (A-24)

Red Star has no quarre! with the first part of the

Court’s definition of “willful misconduct”, and agrees that

it is “an act, intentionally done, with knowledge that the

performance will probably result in injury”. The Court

found Red Star guilty of no act which met this test. In-

stead, the Court based its denial of the right to limit lia-

bility solely on its alternative definition of “willful mis-

conduct” i.e., “an act intentionally done... in such a way

as to allow an inference of a reckless disregard of the

probable consequences.” This alternative definition is not

only contrary to the plain language of the Pollution Act,

but conflicts with the definition of “willful misconduct”

indicated by the Court of Appeals for the Sixth Circuit

and the Distriet Court for the Eastern District of Vir-

ginia, and by the Court of Appeals for the District of

Columbia Cireuit with respect to the Warsaw Convention.

The only other reported decision of a Cireuit Court of

Appeals involving the “willful misconduct” exception to

the right of limitation of liability under the Pollution Act

is United States v. Hamel, 551 F.2d 107 (6th Cir, 1977).

There, the Court of Appeals for the Sixth Cireuit affirmed

the conviction of the defendant for willfully discharging

gasoline into navigable waters in violation of the Pollu-

tion Act, 33 U.S.C. § 1319(e)(1). In its diseussion of

& 1319(ce)(1), the Court stated that the Government had

the same burden of proving scienter in recovering clean-

up expenses under § 1321(f) [and therefore § 1321(g)]

as it does in establishing criminal liability under § 1319(¢)

for an unlawful discharge. According to the Court:

Section 1319(¢)(1) requires proof of negligent or

wilful behavior and subjects violators to a fine of

not less than $2,500 nor more than $25,000 per day

of violation or by imprisonment for not more than

one year, or both * * * With the amendments of

1972, Congress provided a harsher penalty for the

discharge of oil with the added burden on the gov-

ernment to prove scienter. We note the parallel

provision in §1321(f) for more extensive civil lia-

bility with proof of scienter, (551 F.2d at 113 n.9)

; In the instant case, by holding that the denial of limita-

tion of liability under the Pollution Act may be based upon

a mere inference of a reckless disregard rather than proof

by the Government of actual knowledge of probable in-

jury, the Court of Appeals for the Second Cireuit has

clearly established a far lower standard of proof of “will-

ful misconduct” than that required by the Court of Ap-

peals for the Sixth Cireuit in Hamel. Red Star submits

that Hamel is correct, and that the Court of Appeals’ deci-

sion herein is in error.

The decision also conflicts with Matter of Steuart Trans-

portation Company, 435 F.Supp. 798 (E.D. Va. 1977),

where an oil spill was found to have been caused by the

negligent failure of Steuart’s managers and superintend-

ents to properly inspect and remedy what were clearly

visible defects that led to the sinking of a barge. The

District Court held that while the negligence was within

* An appeal was argued in November, 1978, Docket Nos. 77-2426

7 gual (4th Cir.), but had not been decided as of Decem-

r :

the privity and knowledge of Steuart, it was not “willful”,

and that Steuart was therefore entitled to limitation of

liability to the Government under the Pollution Act, al-

though not to limitation of liability to other claimants un-

der the Limitation of Liability Act:

The failure of Steuart’s managers and superintend-

ents to discover and remedy this defect in the barge

amounts to negligence within the privity and knowl-

edge of Steuart ... There is no evidence, however,

that Steuart’s failure to recognize and correct the

deterioration of one of the deck closures was in any

sense willful. The evidence all leads to a finding

of ordinary negligence. (435 F.Supp. at 803)

It is manifest that the Court in Steuart interpreted

“willful” in the ordinary sense of the word, and concluded

that to “break” limitation under the Pollution Act, the

burden was on the Government to prove an intentional

act on the part of Steuart which it knew would probably

result in harm—a far higher Standard of proof than that

required by the Court of Appeals herein.

The alternative definition of “willful misconduct” adopted

by the Court of Appeals in this case also conflicts with

American Airlines v. Ulen, 186 F.2d 529, 5383 (D.C. Cir.

1949), where it was held that “willful misconduct” under

the Warsaw Convention must consist of a deliberate, know-

ing and intentional violation of a known duty. According

to the Court:

One recent federal court decision defines the terms

as follows: “Willful misconduct means a deliberate

purpose not to discharge some duty necessary to

safety.” [Cireuit Judge Minton in Rowe v. Gatke

Corporation, 7 Cir., 1942, 126 F.2d 61, 66]. This

definition squarely fits the facts in the present case.

The obvious au’ sole purpose of Civil Air Regula-

tions * * * is safety. It imposed a duty upon all

scheduled carriers which appellant. deliberately,

knowingly and intentionally violated. (186 F.2d at

533)

See also Koninklijke Luchtvaart Maatschappij N.V. KLM

v. Puller, 292 F.2d 775 (D.C. Cir. 1961), cert. denied 368

U.S. 921 (1961), where the court adhered to the definition

of “willful misconduct” set forth in American Airlines,

Inc. vy. Ulen, supra.

In Rowe. v. Gatke Corporation, 126 F.2d 61, 66 (7th Cir.

1942), appeal dismissed 317 U.S. 702, cited in American

Airlines, Inc. vy. Ulen, supra, the Court of Appeals for the

Seventh Cireuit established a definition of willful miseon-

duet in connection with a state regulatory statute, the In-

diana Occupational Disease Act:

“Willful” means more than intentional and occa-

sional breach of duty. “Willful misconduct” means

a deliberate purpose not to discharge some duty

necessary to safety. It implies obstinancy, stub-

borness, set purpose, and conduct that amounts to

deliberate bad faith, quasi-criminal in its nature.

In the present case, by holding that “willful misconduct”

may be found by a showing by the Government of proof

which permits merely an inference of a reckless disregard

of the probable consequences of the act, the Court of Ap-

peals for the Second Cireuit has fashioned a very broad

definition inconsistent with the statutory language, as well

with the Congressional intent. Red Star submits that the

only correct definition is one that requires proof of actual

knowledge that injury will probably result from the act.

As the Court below held, the Government did not carry its

burden of proof in establishing such actual lmowledge on

the part of Red Star.

The error in the definition of “willful misconduct is com-

pounded by the Court of Appeals’ application of it to the

facts. After reviewing all of the faults it attributed to Red

Star, the Court explicitly concluded that not a single one,

standing alone, constituted willful misconduct. According

to the Court:

While any one of the faults of Red Star alone, even

within privity, may not constitute “willful miscon-

duct”, on the entire record the various inactions and

gross disregard of the potential harm amount, in our

opinion, to willful misconduct within the meaning

of the statute. (A-26)

By converting into “willful misconduct” several acts

any one of which, standing alone, it held would constitute

at most ordinary negligence, the Court below has employed

an entirely novel process of #ynergy never contemplated

by Congress and which is seriously in error as a matter of

law. Moreover, as will be shown in Point II, infra, the

error is further compounded by the fact that the various

negligent acts the Court econeluded had the cumulative ef-

fect of “willful misconduct” were not within the “privity

and knowledge” of Red Star, as the Pollution Act expressly

requires as a conditon to the denial of the right of lim-

itation.

Regardless of what definition of “willful misconduct” is

accepted, the right of limitation under the Pollution Act

may be denied only if the Government can prove that the

“willful misconduct was within the privity and knowledge”

of the third-party owner of the vessel responsible for the

oil spill. 33 U.S.C. § 1821(g). See H.R. Rep. No. 91-940,

91st Cong., 2d Sess. 38-39 (1970) (Comm. of Conference).

There can be no doubt that Congress intended the phrase

“privity and knowledge” to have the same meaning and

application as the nearly identical phrase in the Limita-

tion of Liability Act, 46 U.S.C. 183(a), providing that

limitation thereunder may be denied if the vessel owner

fails to show that the casualty occurred without his

“privity and knowledge”. It should be stressed, however,

that limitation under the Limitation Statute will be denied

if there is fault within the privity and knowledge of the

owner, whereas under the Pollution Act the Government

must prove “we'lful negligence or willful misconduct

within the privity and knowledge” of the owner or opera-

tor of the vessel responsible for the discharge.

In direct conflict with the express language of the Pol-

lution Act, however, the Court of Appeals disregarded the

requirement that the “willful misconduet” depriving the

party of his right to limit his liability thereunder must

have been within the “privity and knowledge” of Red Star,

.¢., it must have been that of a managing officer of Red

Star. See Craig v. Continental Ins. Co., 141 U.S. 638

(1891), holding that in the case of a corporate owner, the

“privity and knowledge” required to deny limitation under

the Limitation of Liability Act “must be that of the manag-

ing officers of the corporation; 3 Benedict on Admiralty,

5-14 n.2 (1975).

The Court below explicitly concluded that those faults

which it held within Red Star’s privity did not fulfill even

its own test of “willful misconduct” (A-26). Despite this

conclusion, based on the cumulative effect of negligent acts

not within Red Star’s privity and knowledge, the Court of

Appeals held that Red Star was not entitled to limitation

of liability with respect to the Government’s claim,

The Court of Appeals’ rationale for disregarding this

express requirement is plainly at odds with the Congres-

H ; i . .

sional intent underlying the Act. According to the Court:

Otherwise, it would be difficult to imagine what

would be necessary to make a tug company liable

for the costs of cleaning a negligent oil spill save

an admission of an actual intent to do so, and would

extend to the tugboat industry an almost absolute

exemption from liability for pollution cleanup costs.

(A-26)

This statement ignores the stated policy of the Congress

that vessel owners should be entitled to limit the amount

of their liability to the Government for pollution clean-up

expenses to $100 per ton, except in extraordinary cases,

Congress was fully cognizant of its purposes in limiting

the liability of vessel owners to insurable amounts, and

by doing so, clearly did not intend to grant tug owners

“an almost absolute exemption from liability for pollution

cleanup costs.” As Senator Cooper stated in introducing

the Conference Committee bill which was eventually signed

into law:

Consistent with the philosophy of absolute liability,

limits of liability are provided, This is an important

provision, which I consider draws a proper balance

between the public interest and the ability of pri-

vale enterprise to respond. 1 think it should be

pointed out that the provision was adopted only

after the most careful consideration and thorough

study.’”

5 Statement of Senator Cooper, March 24, 1969, in Environmental

Protection Agency, Legal Compilation 1967 (1973), See also State-

(Footnote continued on following page)

In balancing the “public interest” against the “ability

of private enterprise to respond”, Congress expressly in-

tended that while a vessel owner could be held liahle to

the Government for its clean-up costs if his employees

were negligent, this liability should be limited, even if the

negligence might amount to willful negligence or miscon-

duet of such employees.

The importance of this express requirement in the com-

prehensive liability scheme embodied in the Pollution Act

cannot be overstated. The Act and all of its major fea-

tures, including the requirements for the provision by in-

surers of certificates of financial responsibility, 33 U.S.C,

§ 1321(p), are premised on the principle of limitation of

liability which ean be denied only in the ease of a deliber-

ate act by the vessel owner himself, or, in the case of a

corporate owner, that of its managing officers, which he

or they know will probably result in harm. To disregard

the “privity and knowledge” requirement of the Act, as the

Court of Appeals has done in the instant ease, is to ignore

both its express language and its underlying principles,

The Court of Appeals has improperly applied the Penn-

sylvania Rule to deny limitation of Red Star’s liability

(Footnote continued from preceding page)

ment of Representative Cramer, March 25, 1969, in /d., at 1981;

Statement of Representative Roth, March 25, 1969, in Jd. at 1995;

See generally S. Rep. No. 91-351, 91st Cong., Ist Sess, (1969) ;

H.R. Rep. No, 91-127, 91st Cong., Ist Sess. (1969) ; H.R. Rep. No,

91-940, 91st Cong., 2d Sess. (1970) (Comm. of Conference) ; S, Rep.

No. 92-414, 92d Cong., 2d Sess. (1971); H.R. Rep. No. 92-911,

92d Cong., 2d Sess. (1972); S. Rep, No. 92-1236, 92d Cong., 2d

Sess. (1972).

under Pollution Act. In The Pennsylvania, 86 U.S. 125

(1874), this Court held that where a vessel is guilty of a

statutory violation, her owner ean eseape liability only it

he can show that the violation could not have contributed

to the casualty, In the present ease, the Court of Appeals

concluded that Reimer’s failure to post a lookout was

such a violation, and that under The Pennsylvania, Red

Star had the burden of showing that this could not have

contributed to the grounding, (A-19), Reversing the Dis-

trict Court, the Court of Appeals held that Red Star had

failed to carry this burden of proof. (A-19).

Whether or not the Court of Appeals was correct in ap-

plying the Pennsylvania Rule in determining Red Star’s

liability to Pittston, the Court was plainly in error in ap-

plying the Rule in holding Red Star guilty of “willful

misconduct” depriving it of the right to limit its liability to

the Government under the Pollution Aet. That Act ex-

pressly provides that the burden is on the Government

to prove that the discharge was caused by “willful miseon-

duet within the privity and knowledge” of the owner of the

responsible vessel before the latter may be denied the right

to limit. The language of the statute could not be plainer:

If the United States can show that the discharge of

oil... was the result of willful negligence or willful

misconduct within the privity and knowledge of such

third party, such third party shall be liable to the

United States Government for the full amount of

such removal costs.

There was no affirmative proof by the Government that

the failure to post a lookout was causally related to the

grounding. The Court of Appeals simply held that Red

Star had failed to carry its burden of proof under The

Pennsylvania because it did not prove that a lookout would

not have seen Con Hook Light in time to avoid the ground-

ing. According to the Court:

Even though a lookout did not see the ice stranded

buoy, it would be a matter of pure speculation to say

that a proper lookout would not have seen and re-

ported Con Hook Light. (A-18).

It was likewise speculation for the Court to say that a

lookout would in faet have seen Con Hook Light in ample

time before the grounding, Indeed, the expert testimony

at trial was that Con Took Light comes into view too late

to be of any assistance to northbound vessels such as the

Ocran Prince, and Reimer, who was searching for the ean

buoy south of Con Hook Light, never saw the light until

just after the grounding, (B-13),

By applying the Pennsylvania Rule, the Court of Ap-

peals erroneously relieved the Government of the burden

of proof placed upon it by the plain words of the Pollu-

tion Act.

IV.

The Court of Appeals’ decision denying Red Star lim-

itation of its liability to Pittston is in direct conflict with

Craig v. Continental Ins. Co., 141 U.S. 688 (1891), where

this Court held that in the ease of a corporate shipowner,

the “privity and knowledge” required to deny it the right

to limit its liability under the Limitation of Liability Act,

46 U.S.C. §183(a), “must be that of the managing officers

of the corporation”. See also Coryell v. Phipps, 317 U.S.

406, 410 (1943); Spencer Kellogg & Sons vy, Hicks, 285

U.S, 502 (1932). The Court of Appeals has disregarded

this requirement in denying Red Star the right to limit

its liability to Pittston,

None of the faults the Court of Appeals has attributed

to Red Star ean conceivably be considered acts of a “man-

aging officer of the corporation’. The “navigational mis-

takes” charged (A-26) were errors on the part of Reimer

which were clearly not within the privity and knowledge

of Red Star’s management, See Craig v. Continental Ins,

Co., supra; 3 Benedict on Admiralty § 42.

The Court of Appeals also placed much emphasis on the

failure of the night dispatcher Keenan to advise Kiernan

that he was the intended eaptain, and that Reimer was not

experienced in navigating the Hudson, (A-25-26). No case

has been found in which a tug dispateher or similar em-

ployee has been held a “managing officer” of a corporate

owner, and Red Star submits that there is none, See 3

Benedict on Admiralty § 42 (1975). Indeed, the evidence

was clear that Keenan’s responsibilities Were so limited

that he could not conceivably have such status, and there

was no finding by either the District Court or the Court

of Appeals itself that he was a “managing officer”,

Finally, the Court of Appeals concluded that the failure

to post a lookout was within the privity and knowledge

of Red Star. But the failure was plainly Reimer’s, and

his negligence in the navigation and management of the

Tug was not within Red Star’s privity and knowledge.

The Court of Appeals correctly held that a lookout is not

required at all times, but only “if proper precautions or

special circumstances required it”, (A-9). Red Star’s pol-

iey coincided exactly with the standard of care required

by the Court of Appeals. The record is plain that Red

Star did provide a deckhand to act as lookout, whom

Reimer chose to send to the galley to get coffee at perhaps

the most inopportune time possible. The testimony of Red

Star’s Vice President of Operations, the only managing

officer of the corporation ever referred to in the Court of

Appeals’ decision, could not have been clearer: When the

circumstances dictated the need for a lookout, one was to

be posted and he was to have no other duties. At no time

did Red Star “condone” a practice of sending a lookout for

coffee. All that Red Star did “condone” was the practice

of sending a deckhand to get coffee only if he was not

needed as a lookout.

Reimer’s failure to post a lookout when one was required

involved a decision that could be made only on the spot,

by one having knowledge of the circumstances. There was

of course no opportunity to consult with Red Star’s man-

agement as the Tug and Barge approached the rock for-

mation on which the stranding occurred. The finding of

the Court below was that Red Star had no actual knowl-

edge that no lookout was posted, but that there was con-

structive knowledge, and that this was sufficient to deny

limitation. It has long been settled by this Court, however,

that limitation may be denied only if there is actual privity

and knowledge. Coryell v. Phipps, supra, 317 U.S. at 410-

12; Deslions v. La Compagnie Generale Transatlantique,

(La Bourgogne), 210 U.S. 95, 122-126 (1908). Indeed, the

Court of Appeals for the Second Cireuit said it well many

years ago in The 84-II, 296 F. 427 (1923): “The privity

and knowledge must be actual and not merely constructive.”

In failing to adhere to its own rule in the present ease, the

Court of Appeals has clearly erred.

‘he decision below is in direct conflict with that of the

Fourth Cireuit Court of Appeals in The Temple Bar, 137

F.2d 293 (4th Cir. 1948), with respect to the very im-

portant question of whether, by placing an otherwise com-

petent navigator in command of a tug and supplying him

ae er

with all possible navigational aids, a shipowner has per-

formed his duty of making the vessel seaworthy, if the

navigator does not have any experience navigating in the

area. This conflict among the Circuits has resulted in great

uncertainty in the tugboat and shipping industries as to

what standards must be followed in manning vessels.

The Court of Appeals held in this ease that the Tug was

unseaworthy solely because Reimer had never before

served as a navigator on the Hudson. (A-11). The Court

so held despite the facts that (a) Reimer held a valid

Coast Guard license which entitled him to act as navigator

on the trip in question, (b) before the casualty, Reimer had

been a tug captain for five years, and had been on board

the Ocean Prince for 114 years, (c) Reimer was well aware

of the location of the submerged rocks and knew they were

marked by a can buoy which he looked for, (d) the Tug

was equipped with eharts, the “Coast Pilot”, and the Light

List for the area in question, and (e) Kiernan, who had

30 years of experience on the Hudson as a tug captain,

was on board and available to assist Reimer at any time,

regardless of any doubt he may have had as to who was

the senior man.

The District Court found that Reimer was competent and

the Tug seaworthy, even though, while he had been up and

down the River numerous times as a deckhand, Reimer

had not previously served as a navigator in the [udson.

The District Court concluded:

Reimer is a licensed tug captain with several years’

experience in tugboats. Ile had available charts and

publications which clearly designated the location

of the submerged rocks. Moreover, he was clearly

aware of the hazard because he had been searching

for the can buoy for a substantial period of time

prior to the grounding. A failure to perceive the

hazard might have been indicative of generalized

incompetence which would have created an unsea-

worthy condition. An inadequate response to a

known danger presents an error in navigational

judgment and, as such, falls outside the owner’s

privity and knowledge. (B-22-23)

In so holding, the District Court expressly followed the

rule established in The Temple Bar, supra. (B-22). There,

it was contended that the stranding of the vessel was

caused by the master’s lack of experience in the area and

his ignorance of the prevailing currents. The claimant

argued that under The Lady Pike, 88 U.S. 1 (1874), a

master’s lack of familiarity makes his vessel unseaworthy.

The Court of Appeals for the Fourth Cireuit rejected this

contention, stating with reference to The Lady Pike:

.. + [T]he decision cannot be accepted as authority

for the broad proposition that it is negligent to put

a master in charge of a ship, whatever the voyage,

unless he is familiar with all the loeal conditions he

may be expected to encounter. If, as in the case at

bar, a master qualified in other respects, is placed

m command, and if he is supplied with charts and

publications sufficient to enable a competent man

safely to navigate the ship, it is not necessary that

he should have prior knowledge of local conditions,

and lack of it will not cause the ship to be wnsea-

worthy. (187 F.2d at 292)

The Court of Appeals herein expressly disagreed with

the reasoning of the Fourth Cireuit Court of Appeals and

held that the Tug was unseaworthy per se solely because

Reimer, though an otherwise competent and experienced

navigator who, with the aid of the charts on board, was

well aware of the location of the submerged rocks, had

never before navigated the Hudson. (A-11).

In creating this conflict with Zhe Temple Bar, the Court

of Appeals stated that it was relying upon The Lady Pike,

supra, where this Court stated with respect to river pilots:

Ignorance of the danger before them is no sufficient

excuse, as the owner appoints the master and is

bound to select one of competent skill and knowl-

edge, to transport goods and merchandise shipped

on board in safety, which necessarily imposes the

obligation to employ a master mariner who knows

enough about the route to avoid the known obstruc-

tions and to choose the most feasible track for his

route. Knowledge of the kind, in river navigation,

is peculiarly essential, as the current frequently

shifts from one side towards the other, and the

track of navigation is often obstructed by snags,

sandbars, and shoals, which no degree of skill would

enable the mariner or pilot to avoid without a prior

knowledge of their existence.

The Court of Appeals held in the present case, in con-

flict with The Temple Bar, that The Lady Pike required a

finding that Reimer was incompetent because of his lack

of experience as a navigator on the Hudson. Red Star

submits that The Temple Bar is correct, and does not con-

flict with The Lady Pike. It was certainly not intended to

sound the death knell of that decision, as the Court of

Appeals infers in this case. (A-13). Rather, The Temple.

Bar quite plainly and correctly holds that The Lady Pike

cannot be read so broadly as to require, as the Court

herein has now held, that a tug is unseaworthy per se if

one of her navigators has not previously navigated on the

particular route the vessel is taking.

Indeed, the error below is highlighted by the fact that

Reimer clearly measured up to the standards outlined in

The Lady Pike. As the District Court found, Reimer was

in no sense “ignorant of the danger”, but had prior knowl-

edge of the existence and location of the submerged rock

formation. The grounding was caused, not by his lack of

familiarity with the River, but by an error in judgment on

his part, which was not within Red Star’s privity and

knowledge.

The Court of Appeals has established a standard of care

on the part of management that may be impossible to at-

tain. The decision goes far beyond any requirements es-

tablished by the Coast Guard for the licensing of tugboat

navigators—the Coast Guard had in fact issued a license

to Reimer entitling him to serve as captain on the Ocean

Prince for the trip in question—or by this Court in The

Lady Pike.

CONCLUSION

For the reasons set forth above, this Petition for a

Writ of Certiorari should be granted.

Respectfully submitted,

Nicuonas J. Hrary

Attorney for Petitioners

29 Broadway

New York, New York 10006

(212) 943-3980

Hearty & Battie

WituiaM F’, Losquapro

Joun D. KimBacu

Of Counsel

Appendices

A-l

APPENDIX A

UNITED STATES COURT OF APPEALS

For tur Seconp Crrcuir

wer

Nos, $42, 901, 902—September Term, 1977.

(Argued May 24, 1978 Decided August 7, 1978.)

Docket Nos. 77-6190, 6195, 6198

In the Matier of the Complaint of Tue Ockax Prince, Ixe.,,

and Rep Star Towine & Transportation Co., as Owner

and Charterer of the Tug “Ocran Prince”, for Exoner-

ation from or Limitation of Liability,

Plaintiffs-Third Party Plaintiff s-

Appellees-Cross-Appellants,

against

Unirep States or America,

Third Party Defendant-Appellee.

thin

Unirep States or Amenica,

Plaintiff-Appellant,

against

Pirrston Marine Transport Corp.,

Defendant-A ppellee,

Tuo. Ockan Prince, Inc, and Rep Star

Towrna & Transportation Co.,

Defendants-A ppellees.,

A-2

Before:

Oakes, Circuit Judge,

Buumenretp, Senior District Judge,”

Menrtens, Senior District Judac.“*

All parties appeal from judgment denying exoneration

and granting limitation of liability to owners and charter-

ers of tug push-towing an oil laden barve which struck

a charted rock in the Hudson River, dismissing claims of

owners and charterers of tue and owner of baree against

the United States, and limiting damages recoverable by

the United States against owners and charterers of tug

for oil pollution cleanup costs.

Reversed in part, affirmed in part, and remanded.

McHven, Heckman, Smith & Lronann, New

York, N. Y, Attorneys for Pittston Marine

Transport Corp.

Heaty & Baru, New York, N. Y., Attorneys

for Tug Ocean Prince, Inc. and Red Star

Towing & Transportation Co.

Tomas J. Cauriy, United States Attorney;

Giusert 8. Frieiscner, Attorney in Charge

Admiralty & Shipping Section, Janis G.

Scuuvmeisters, Trial Attorney, Altorneys

_for United States of America.

— oer

Meurtens, Senior District Judge:

The oil-laden Barge New Lonpox, push-towed by the

Tug Ocran Prince, struck a charted rock outside the

° Sitting by special designation from the District of Connecticut,

Sitting by special designation from the Southern District of Florida,

A-3

navigable channel in the Hudson River, sustaining damage

and causing a considerable oil spill. Tug Ocean Prince,

Inc. and Red Star Towing & Transportation Co, (Red

Star), the owner and charterer of the Tug Ockan Prince,

petitioned for exoneration from or limitation of liability

under 46 U.S.C. §183 et seq. in which proceeding Pittston

Marine Transport Corp. (Pittston) filed claims for dam-

age to the barge and loss of cargo. Red Star thereafter

filed a third-party action against the United States of

America (the United States), alleging that its fault

caused the casualty. The United States counterclaimed

against the tug and crossclaimed against the barge for the

pollution cleanup expenses. Pittston crossclaimed against

the United States for its damages and the United States

counterclaimed against Red Star for the money spent for

cleanup. The United States also filed a separate action

against them for the cleanup costs in the civil pollution

penalty under 33 U.S.C. §1321. The actions were consoli-

dated for trial. The trial court denied exoneration but

granted limitation to the value of the tug. It further found

that Pittston was not responsible for the oil spill and dis-

missed the United States’ action against Pittston. The

court also dismissed both Red Star’s and Pittston’s claims

in the third-party action as well as Pittston’s counterclaim

against the United States in the action it instituted to

recover the cleanup costs, limiting the tug’s liability for

pollution cleanup to $100 per gross ton under the provi-

sions of 33 U.S.C. §1321. Nobody is happy and everybody

has appealed.

The court below made detailed findings of fact and con-

clusions of law. The Ocean Prince v. United States, 436

F.Supp. 907 (1977). The facts may be capsulated, enlarg-

ing upon them as need be in the discussion that follows.

The Facts in the Court Below

In examining Pittston’s and the United States’ conten-

tions that the district court erred in holding that Red Star

was entitled to limit its liability, we make plain at the

outset that we accept the fact-findings made by the trial

court except where they are inconsistent or, in our opin-

ion, clearly erroneous.

The tug Ocean Prince has an overall length of 94.7 feet,

a gross tonnage of 198 tons, and her deep draft was about

14 feet. She is pilothouse controlled, equipped with radar,

a gyro-compass, a magnetic compass, and a searchlight.

She did not have a pelorus or azimuth circle or other equip-

ment with which to take visual bearings. The radar had

relative graduations. With the cursor or cross hairs rela-

tive bearings could be taken. The tug’s deck crew consisted

of two pilots, Walter Reimer and John Kiernan, both Coast

Guard licensed, and two deckhands, one assigned to each

watch, Each pilot and deckhand stood six-hour watches.

The deckhands had other duties and were often sent below

for coffee, all of which was well known to Red Star’s Vice

President of Operations.

The tank Barge New Lonpon, of 1665 gross tons, has an

overall length of 295 feet, and was drawing 12 feet. In her

stern was a pushing notch where the bow of the tug fits

snugly. The tug was secured to the barge with steel cables

and synthetic lines. Steering and propulsion were supplied

by the tug.

Operating as a unit, the tug and barge were 385 feet

long, of 1863 gross tons.

Reimer had been employed by Red Star for about one

and one half years while the Ockan Prince operated in

southern waters. In southern waters Reimer had acted as

her captain and rate, but when the Ocean Prince came

north at the beginning of the year Reimer left for vacation.

on 6 ee Si ee.

Kiernan was employed by an associated company as tug

captain. He had extensive experience on the Hudson River,

but, except for this voyage, had never worked for Red Star.

On February 1, 1974 Kiernan joined the Ocran Princp as

mate.

On February 2nd the permanent captain of the Ocran

Prince left and thereafter Reimer arrived. Red Star in-

tended Kiernan to be captain and Reimer to be mate, but

Red Star’s dispatcher, who assigned the Ockan Prince to

the job, did not communicate this information to Kiernan

or to Reimer, and neither had anyone else, nor was the

fact that Reimer had never piloted on the Hudson River

communicated to Kiernan. As a result, Kiernan and Rei-

mer each assumed that he was the mate and the other the

captain. Reimér, although he had no experience on the

Hudson River, did not check the navigation aids on board

or examine the Light List or the Coast Pilot very care-

fully.

About one and three-quarters miles north of Bear Moun-

tain Bridge lies a large submerged rock formation on the

west side of the channel, which is clearly indicated on the

chart and marked in winter months by the unlighted black

ean buoy “25”.

The Light List warns the pilot not to rely on floating aids

to navigation; that all buoys should be regarded merely

as warnings or guides; that whenever, if possible, a vessel

should be navigated by bearings or angles on fixed objects

on shore and by soundings rather than reliance on buoys;

that the lighted buoy “25” is replaced by an unlighted can

buoy from December 15 to April 1; and that the fixed light

“27” on Con Hook Island is on a black skeleton tower 46

feet above water,

The Coast Pilot advises pilots that during the ice season

aids to navigation are covered or dragged off station by

A-6

moving ice; that, however, the river is well marked by

lights along the shore and, most important, that with re-

spect to the rock marked by buoy “25”, the rock has a depth

of seven feet, and with a fair current there is a tendency

to set toward the rock; caution is advised.

At about 1800 hours (6:00 P.M.) Red Star’s dispatcher

advised the Ocran Prince to proceed to Exxon Dock to

take the Barge New Lonpon to Kingston. Nothing was

said about who would be the captain or Reimer’s lack of

experience on the Hudson River. The Ocean Prince pro-

ceeded there, was secured to the barge, after which Reimer

went below and Kiernan continued on watch, At 2330 hours

(11:30 P.M.) Reimer came to the pilothouse and relieved

Kiernan of the watch. The tug and barge continued north-

ward up the Hudson River past Peekskill and approached

Bear Mountain Bridge. The tide was ebbing. There was

ice in the river and visibility was about two miles with

snow flurries. The tug was proceeding at a speed of about

six knots over the bottom. The radar was operating and

a chart for the area was in the wheelhouse. When the tug

and barge passed under the bridge, Reimer sent the deck-

hand down to the galley to get coffee, remaining by him-

self in the wheelhouse.

Although able to see both shore lines of the river, Reimer

began using the tug’s searchlight to look for buoy “25”

on the lefthand side of the channel. Unable to see it, he

reduced the engine speed to “half, maybe less” and con-

tinued searching for the buoy. He never saw the light on

Con Hook Island ahead, although it was visible from a

position off Fort Montgomery or Town of Manitou about

1.5 miles south of the light and one mile south of the point

of striking. The deckhand returned to the wheelhouse about

the time that the barge struck the rock on her port side

and to the left of the navigational channel. Oil escaped

A-T

from the damaged cargo tanks, creating a serious pollu-

tion problem. Reimer never saw the can buoy, Kiernan

came to the wheelhouse shortly after the striking, saw the

Con Hook Island light ahead and observed the can buoy

on the starboard beam of the tub 50 to 75 feet away.

Reimer was very upset and Kiernan took over the wheel.

He turned the tug and barge around and headed south

to the Dayline Pier. After turning around Kiernan ob-

served the lights on the Bear Mountain Bridge about two

miles away.

The Limitation of Liability

The district court held that the casualty resulted from

errors of navigation and management on board the tug.

not within Red Star’s privity and knowledge, and that,

therefore, its liability was limited to the value of the tug

and her pending freight and that Red Star’s liability to

the United States was subject to the tonnage limitation

contained in 33 U.S.C. §1321(g).

In a limitation proceeding such as this, the burden of

proof as to the absence of privity or knowledge is on the

petitioners, Red Star. Coryell v. Phipps, 317 U.S. 406

(1943). It is the owner’s duty to use due and proper care

to provide a competent master and crew and to see that

the ship is seaworthy; any loss occurring by reason of

fault or neglect in these particulars is within his privity.

Re Reichert Towing Line, 251 F.2d 214 (2d Cir.), cert.

demed, 248 U.S. 565 (1918); Teeracciano v. McAlinden

Construction Co., 485 F.2d 304 (2d Cir. 1973).

Seaworthiness is a relative term depending upon its ap-

plication to the type of vessel and the nature of the voyage.

The general rule is that the vessel must be staunch, strong,

well equipped for the intended voyage and manned by a

competent and skillful master of sound judgment and dis-

cretion. The Niagara v. Cordes, 16 U.S. (21 How.) 7 (1859) ;

A-8

The Framlington Court, 69 F.2d 300, 304 (5th Cir.), cert.

denied, 292 U.S. 651 (1934); Adams v, Boviz, 279 F. 521

(2d Cir, 1922); Northern Commercial Co. vy. Lindblam,

162 F. 250 (9th Cir. 1908). The burden to prove seaworthi-

ness and the exercise of due diligence to make the ship

seaworthy is upon the vessel owner or operator. Teerac-—

ciano v. McAlinden Construction Co., supra. Red Star had

a non-delegable duty to provide a qualified master and

crew for the intended voyage. Boudin v. Lykes Brothers

Steamship Co., 348 U.S. 336 (1955) ; Petition of the United

States, 178 F.2d 248, 252 (2d Cir. 1949). See, Admiral

Towing Co. v. Woolen, 290 F.2d 641, 646 (9th Cir. 1961) ;

Navegacion Castro Rwa v. The M. S. Nordholm, 178 F.

Supp. 736, 741, n.19 (E.D. La. 1959), aff'd, 287 F.2d 398

(5th Cir. 1961). If then, the Ocean Prince was manned by

an inadequate crew, Red Star’s duty as shipowner was

breached on either the theory of negligence or that of un-

seaworthiness. Incompetence of the navigator makes the

vessel unseaworthy. Empire Seafoods, Inc. v. Anderson,

398 F.2d 204 (5th Cir.), cert. denied, 393 U.S. 983 (1968).

The more restricted the operation in which a ve: sel is

engaged the greater will be the degree of control which

the corporate owner will be required to exercise over mas-

ter, crew and subordinate shoreside employees. Avera v.

v. Florida Towing Co., 322 F.2d 155 (5th Cir. 1963); Ad-

miral Towing Co. v. Woolen, supra; G. Gilmore & C. Black,

The Law of Admiralty (2d Ed. 1957) at 704.

Red Star knew the conditions that would be encountered

on a nighttime voyage from Bayonne, New Jersey to

Kingston, New York during the ice season. Specifically,

they knew or should have known that the United States

Coast Guard during the ice season had removed the lighted

buoy usually positioned south of Con Hook and replaced

it with an unlighted can buoy; that buoys are likely to be

A-9

covered or dragged off station by moving ice; that buoy

“95” was located in an area which is susceptible to ice

accumulation; and that these conditions result in obscur-

ing of the buoy. Such conditions did in fact exist and

required Red Star to exercise such reasonable care and

maritime skill as prudent navigators employ in similar

circumstances. Red Star knew that Reimer was totally

unfamiliar with the Hudson River and knew or should

have known that to pilot the tug and barge safely, it was

necessary to furnish a competent captain and, if proper

precaution or special circumstances required it, a lookout.

The district court held Red Star negligent but found

that the casualty occurred without Red Star’s privity and

knowledge. In reaching its conclusion the district court

held that Red Star had exercised the high degree of care

required by complying with the customary practice of hav-

ing at least one of the two pilots with experience on the

waters to be traversed aboard, and to be available to assist

the other when necessary or requested.

The district court clearly erred in accepting as a proper

standard in this case the accepted practice in the tugboat

industry of dispatching a tug to an area in which one of

the pilots had no experience whatsoever so long as the

other pilot on board had experience in the area and that

it was customary practice aboard tugboats for Kiernan

to stand the watch with Reimer if asked.

The rule which has been supported generally by most

of the authorities is that conformity to custom is not in

itself the exercise of due care. Custom and usage do not

justify negligence. A party cannot by his own continued

negligence establish a custom by which he is exempt from

liability; nor is legal responsibility for negligence miti-

gated by the fact that others had also been negligent.

Methods employed in any trade, business or profession,

A-10

however long continued, cannot avail to establish as safe

in law that which is dangerous in fact. See Annot., 77

A.L.R.2d 1327 (1961).

In The T. J. Hooper, 60 F.2d 737, 740 (2d Cir. 1932),

Judge Learned Hand said:

judeed in most cases reasonable prudence is in fact

common prudence; but strictly it is never its measure;

a whole calling may have unduly lagged in the adop-

tion of new and available devices. It never may set

its own tests, however persuasive be its usages. Courts

must in the end say what is required; there are pre-

cautions so imperative that even their universal dis-

regard will not excuse their omission. (Citations

omitted).

In Troupe v. Chicago, Duluth & Georgian Bay Transit

Co., 234 F.2d 253, 260 (2d Cir. 1956), Judge Waterman,

in an action predicated upon negligence under the Jones

Act for unseaworthiness under the general maritime law,

stated:

* * * While the customary practice of the industry

is relevant and admissible, the defendant’s standard

of care in a negligence action is not limited to com-

plying with usual practices in the industry or trade.

Wabash R. Co, v. MeDaniels, 1883, 107 U.S. 454, 460-

461, 2 S.Ct. 932, 27 L.Ed. 605; Poignant v. United

States, 2 Cir., 1955, 225 F.2d 595; Uline Ice, Ine. v.

Sullivan, 1950, 88 U.S. App. D.C. 104, 187 F.2d 82;

The T. J. Hooper, 2 Cir., 1932, 60 F.2d 737.

In Jume T., Inc. v. King, 290 F.2d 404, 406 (5th Cir.

1961), the court, in holding that even though it was usual

and customary to have a two-man crew, nevertheless the

A-11

shrimper was unseaworthy because a two-man crew was

insufficient, stated:

* * * What is customary in a trade may be evidence

of due care—here the reasonable fitness element on

the concept of seaworthiness—but it is not the legal

measure of the duty. The T. J. Hooper, 2 Cir., 1932,

60 F.2d 737, 1932 A.M.C. 1175; Troupe v. Chicago,

Duluth & Georgian Bay Transit Co., 2 Cir., 1956, 234

F.2d 253, 260, 1956 A.M.C. 1367; Universe Tankships,

Ine. v. Pyrate Tank Cleaners, Inc., D.C.S.D.N.Y. 1957,

152 F.Supp. 903, 918, 1957 A.M.C. 1436; 38 Am.Jur.,

Negligence, §34; Schlichter v. Port Arthur Towing

Co., 5 Cir., 1961, 288 F.2d 801.

In Burgess v. M/V Tamano, 564 F.2d 964, 981 (1st Cir.

1977), the court, in imposing liability upon the owners of

a supertanker for the government’s cleanup costs, stated:

* * * Tt was no sufficient answer that it was custom-

ary to enter at night, and that the Coast Guard had

not forbidden it. Texas & Pac. Ry. v. Behymer, 1903,

189 U.S. 468, 470, 23 S.Ct. 622, 47 L.Ed. 905; The

T. J. Hooper, 2 Cir., 1932, 60 F.2d 737, 740 (L. Hand,

J.), cert, denied, 287 U.S. 662, 53 S.Ct. 220, 77 L.Ed.

571; Restatement, ante, § 33; Prosser, ante, §33....

As competent he might be in southern waters, Reimer,

who was totally unfamiliar with Hudson River waters

during the ice season, was not competent to take over,

as a pilot or tug steerer, a tug and oil-loaded barge with

a combined total of over 1800 gross tons. Red Star’s

management knew of Reimer’s lack of experience on the

Hudson River, knew of the conditions to be encountered,

knew that he would stand night watches, clearly failed in

its duty to exercise due diligence and sent out a ship un-

A-12

seaworthy because not properly manned under the exist-

ing conditions.

Neither was the fact that Kiernan, an experienced pilot,

would have taken over the wheel, if asked, a sufficient

excuse. Under this concept, if carried far enough, Red

Star could excuse itself from liability even though an

inexperienced, incompetent deckhand had been at the wheel,

so long as he could have called a competent pilot.

In arriving at its conclusion the district court rejected

the case of The Lady Pike, 88 U.S. (21 Wall.) 1 (1874),

and adopted as “modern authority” The Temple Bar, 137

F.2d 293 (4th Cir. 1943).

In The Lady Pike, supra, the Supreme Court, with re-

spect to pilots, laid down the following rule:

Ignorance of the danger before them is no sufficient

excuse, as the owner appoints the master and is bound

to select one of competent skill and knowledge, to

transport goods and merchandise shipped on board

in safety, which necessarily imposes the obligation

to employ a master mariner who knows enough about

the route to avoid the known obstructions and to

choose the most feasible track for his route. Knowl-

edge of the kind, in river navigation, is peculiarly

essential, as the current frequently shift from one

side towards the other, and the track of navigation

is often obstructed by snags, sandbars, and shoals,

which no degree of skill would enable the mariner or

pilot to avoid without a prior knowledge of their

existence.

The next year in Atlee v. New York Union Packet Com-

pany, 88 U.S. (21 Wall.) 389, 396 (1875), the court stated:

* * * (T)he pilot of a river steamer, like the harbor

pilot, is selected for his personal knowledge of the

A-13

topography through which he steers his vessel. * * *

He must know where the navigable channel is, in its

relation to all these external objects, especially in the

night. He must also be familiar with all dangers that

are permanently located in the course of the river, as

. sunken rocks... All this he must know and re-

member and avoid...

These decisions are still viable insofar as the standards

they set for inshore piloting and are applicable here. The

district court expressly recognized the difference between

inshore piloting and ocean navigation, but erroneously

adopted and applied the standards set out in The Temple

Bar, supra, dealing with an ocean-going vessel on a foreign

voyage, which does not set standards for inshore pilots.

The standards set out in The Lady Pike, supra, and in

Atlee v. New York Union Packet Co., supra, relating to

inshore pilots have not lost any of their strength; they

are not moribund and their eulogy has not been delivered.

Counsel has not cited, and we cannot find a reported

case, where, as here, there was a complete failure by the

ship owner to dispatch a vessel without appointing a cap-

tain. Because Red Star had a non-delegable duty to pro-

vide a qualified captain and crew, it seriously failed in

that duty by sending the Ocean Prince on that trip with-

out appointing someone (Kiernan or Reimer) as captain

in command.

The district court further found that it was the captain’s

duty to know the experience and qualifications of the mate,

but here we had no captain. Neither Kiernan nor Reimer

had been told who was the master. Kiernan had never

worked for Red Star before and was not told, nor did he

know, of Reimer’s total lack of experience on the Hudson,

all of which the district court found to be “an unfortunate

set of circumstances”, creating confusion. Red Star’s man-

A-14

agement alone was responsible for this “unfortunate set

of circumstances.” If it had intended Kiernan to be cap-

tain, it should at least have told him that he was captain

and that Reimer had no experience on the river. Red Star

should not have permitted this situation to develop, that

is, directing the tug to make up to a loaded oil barge, and

to proceed at night through waters that required special

knowledge of the conditions that would be met, without

clearly defining or advising its personnel as to which one

of them had the ultimate responsibility of command. For

Red Star to do so was clearly a negligent act on the part

of Red Star’s management, and Red Star’s management

was not exercising the character of care required.

The district court further found that “Even without the

warning in the Coast Pilot, a mariner familiar with the

river would not have relied on the buoy at this time of

year under the existing conditions”; that “Reimer was

well aware that he was unprepared to navigate under the

difficult conditions which were rapidly developing”, that

“With proper use of radar, Reimer could have gotten a

radar range from the Bear Mountain Bridge with reason-

able accuracy. With a radar range off Bear Mountain

Bridge and a visual bearing on Con Hook Light it would

have been possible to construct a danger bearing to keep

the vessel off the rock. However, since the Tug, as most

tugs, was not equipped with a gyro repeater or a pelorus

it was difficult to take accurate visual bearings”; and that

“Had Kiernan been brought to the wheel house, it is very

likely he would have quickly detected that they were to

the west of the channel and that the buoy was obscured by

drifting ice.”

The grounding of the Barge New Lonpon did not occur

because of a single separate incident. It was the result

of an accumulation of acts, all of which originated with

A-15

Red Star’s management, resulting in an easily foreseeable

casualty. Where, as here, Red Star by prior action or in-

action set into motion a chain of circumstances which

may be a contributing cause even though not the immedi-

ate or proximate cause of a casualty, the right to limitation

is properly denied. Waterman Steamship Corp. v. Gay

Cotton, 414 F.2d 724 (9th Cir, 1969). Red Star’s actions

must be considered as causative when establishing fault

in the grounding of the barge, and as such they come

within the privity and knowledge of Red Star.

In Nuccio v. Royal Indemnity Co., 280 F. Supp. 468, 469

(E.D. La, 1968), a proceeding to recover for injuries sus-

tained when the boat on which libelant was a guest pas-

senger collided into the bank of the bayou, the court stated:

It is hornbook law that when a moving vessel strikes

a stationary object an inference of negligence arises

and the owner of the vessel then has the burden of

rebutting such inference. This respondent has failed

to do.

The defense of limitation of liability is also unavail-

able to respondent because this accident occurred

within the full privity of its assured. When respon-

dent’s assured entrusted tke operation of the Pintail

to an inexperienced person, he destroyed any defenses

which he might have had relative to limitation of

liability.

On appeal, Nuccio v. Royal Indemnity Co., 415 F.2d 228,

229 (5th Cir. 1969), the lower court was affirmed with the

statement that:

Once it is determined that Arceneaux was negligent

and therefore liable for Nuccio’s injuries, Royal’s con-

tention that the trial court erred in failing to limit

A-16

liability to the value of the Pintail becomes frivolous.

In order to limit the owner’s liability, the injury must

oecur without his “privity or knowledge.” This phrase

is often defined as “complicity in the fault that caused

the accident.” Where the owner’s negligent act caused

the alleged injury as found by the trial court, clearly

all of the requirements of “privity” are satisfied.

The reasoning of that case is equally applicable here

where Red Star’s management entrusted the operation of

the Ocran Prince to an inexperienced pilot.

Accepting as we do all of the district court’s consistent

fact findings, we nonetheless conclude in the context of the

uncontradicted facts of this record that the casualty oc-

curred as a result of negligence and unseaworthiness within

the privity and knowledg of Red Star; that the order grant-

ing limitation of liability should be vacated; and that the

court should have entered an order denying limitation of

liability.

The Failure to Post a Lookout

The district court, while finding that “Reimer failed to

post a lookout when the conditions were such that the same

was required,” also found that “There was no proof what-

ever that a lookout forward could have observed the ice

stranded buoy,” and then it concluded that “the failure to

post a lookout cannot be said to have contributed to the

collision.” This we find to be clearly erroneous because a

lookout of suitable experience and competence, properly

stationed, and vigilantly employed in the performance of

his duty would have seen and reported the Con Hook Light

in ample time to avoid the casualty.

Title 33, U.S.C. §221 reads as follows:

Nothing in these rules shall exonerate any vessel,

or the owner or master or crew thereof, from the con-

—

A-17

sequences of any neglect to carry lights or signals, or

of any neglect to keep a proper lookout, or of the ne-

glect of any precaution which may be required by the

ordinary practice of seamen, or by the special cireum-

stances of the case.

The importance of a lookout was stated by the Supreme

Court in The Ariadne, 80 U.S. 475, 478-79 (1861), thus:

The duty of the lookout is of the highest importance.

Upon nothing else does the safety of those concerned

so much depend, * * * It is the duty of all courts

charged with the administration of this branch of our

jurisprudence, to give the fullest effect whenever the

circumstances are such as to call for its application.

Every doubt as to the performance of the duty, and

the effect of non-performance, should be resolved

against the vessel sought to be inculpated until she

vindicates herself by testimony conclusive to the

contrary.

The lookout rule applies, of course, to tug boats. The

Supply No. 4, 109 F.2d 101 (2d Cir. 1940). It is also

established that the pilot steering a tug and tow is not a

proper lookout. Dwyer Oil Transport Co. v. The Edna

M. Matton, 255 F.2d 380 (2d Cir. 1958); The Supply No. 4,

supra; Ou Transfer Corp. v. Diesel Tanker F,. A. Verdon,

Inc., 192 F. Supp. 245 (S.D.N.Y. 1960).

Reimer was alone in the wheelhouse some 1750 yards

south of the location of the charted rock when he experi-

enced difficulty in locating the buoy. Despite being unable

to locate it visually or with the radar, he did not direct

the deckhand to serve as a lookout. The uncontradicted

evidence shows that Con Hook Light was visible about

0.62 miles or 1300 yards south of the rock marked by

A-18

buoy “25”. From that point it would have taken the tug

and barge 10 to 12 minutes to reach the rock all while

the Con Hook Light and the shore line were visible.

The Con Hook Light is on top of a tower 46 feet above

mean low water. It is visible at the rock (buoy “25”), is

visible off Mystery Point, at Manitou, and is visible fur-

ther south. The chart shows that there is a straight line

of sight from Con Hook Light all the way down to the

center of the Bear Mountain Bridge.

This is where the failure to have a proper lookout is

important and significant and not his ability or inability

to see the buoy. Once Con Hook Light was sighted, a

pilot could take bearings forward to that light and aft

to Bear Mountain Bridge, establishing a line of position

and a danger bearing so that the tug’s position on one

side would assure the tug and barge being in safe waters,

while a position on the other side would clearly indicate

a hazardous situation. Reimer had at least 10 minutes

and probable more time during which the Con Hook Light

was visible, yet he had no lookout and did not notice it

himself, Even though a lookout did not see the ice stranded

buoy, it would be a matter of pure speculation to say that

a proper lookout would not have seen and reported Con

Hook Light.

It seems clear that under the circumstances existing the

ordinary practice of seamen required the keeping of a

proper lookout at that time and place. Of course, in order

to take proper precautions Reimer would first have to see

Con Hook Light. He did not see it, and there was no

lookout to report it, as the person who would have been

the lookout was getting coffee. This was the usual practice

condoned by Red Star’s Vice President of Operations,

The failure to post a lookout when the conditions were

such that the same was required was not only negligent

A-19

and contrary to good practice, it was also a violation of a

statutory duty. Such a violation invokes The Pennsylvania

rule. When a ship violates a statutory rule intended to

prevent casualties “The burden rests upon the ship of

showing not merely that her fault might not have been

one of the causes, or that it probably was not, but that it

could not have been. Such a rule is necessary to enforce

obedience to the mandate of the statute.” The Pennsyl-

vania v. Troupe, 86 U.S. (19 Wall.) 125, 136 (1874); Ira

S. Bushey & Sons, Inc. v. United States, 172 F.2d 447 (2d

Cir. 1949). The “Pennsylvania rule” is still alive and well

today. That rule’s vitality and force were not in any de-

gree affected by United States v. Reliable Transfer Co.,

421 U.S. 397 (1975), which overruled The Pennsylvania

only in so far as it abolished the Mutual Fault-Equal

Contribution rule and substituted a new rule requiring

liability for collision damage to be allocated proportion-

ately to the comparative degree of fault.

In this case we hold that the district court’s finding that

failure to post a lookout cannot be said to contribute to

the casualty is in the light of the uncontradicted facts and

The Pennsylvania rule clearly erroneous and that Red

Star failed to overcome its burden of showing that by

all reasonable probabilities its failure to require a look-

out did not contribute to the cause of the collision. We

further conclude that a finding of lack of privity or knowl-

edge on Red Star’s part is also clearly erroneous.

This alone is enough to deny Red Star limitation of

liability.

Government’s Responsibility for the Grounding

We need not pause long to conclude that the district

court properly held that the United States should not be

found liable under the suits in Admiralty Act, 46 U.S.C.

A-20

§§ 741-52. There was substantial evidence from which the

disiviet court found that during the ice season the can

buoy is the best practical floating aid for the site under

present technology; that a fixed tower on the rock, the

base of which would be in 7 feet of water, would be dam-

aged or destroyed by ice, and that it cannot be said that

the negligence, if any, of the United States in not estab-

lishing more effective aids to navigation was the proximate

cause of the grounding.

We therefore affirm the district court’s dismissal of the

claims over against the United States.

Red Star’s Liability to the United States

for Poliution Cleanup Costs

The district court limited Red Star’s liability to the

United States, for pollution cleanup costs, to $100 per

gross ton of the Tug Ocean Prince, or $19,800.00.

The United States insists that Red Star’s actions, as a

whole, constitute willful negligence or willful misconduct

within its privity and knowledge.

The United States also contends that even if this not be

so, the district court should have applied the “flotilla doc-

trine” and used the combined tonnages of the tug and

barge, as a unit, in assessing pollution cleanup damages

against Red Star. |

If the United States is correct, then Red Star’s liability

for the cleanup costs would be $186,300.00 instead of

$19,800.00.

The district court held that the cause of the grounding

was not a fault within the privity and knowledge of Red

Star and, therefore, never reached the question of what

constituted willful negligence or willful misconduct. Be-

cause we hold that the Ockan Prince was unseaworthy at

the inception of the voyage and that Red Star was guilty

A-21

of negligence within its privity and knowledge, we must

decide whether Red Star’s actions constituted willful neg-

ligence or willful misconduct and, if it did not, whether the

“flotilla rule” should be applied.

Increased oil pollution of the seas is a natural conse-

quence of the world’s increased dependence on oil to sat-

isfy industrial needs and basic energy requirements, Each

year approximately 60% of the world production of oil

is transported by sea. About 1/10 of 1% of this amount

is lost at sea. This amount is divided between tank clean-

ing operations wherein “slops” are dumped overboard and

accident-related spills! The advent of the supertanker has

created the danger of larger oil spills, such as occurred

as a result of the strandings of The Torrey Canyon and

the Ocean Eagle. Dumping and accidental spilling of oil

constitutes a major pollution threat to the water resources

of the nation. It can destroy or limit marine life, ruin

wild life habitats, kill birds, limit or destroy the recrea-

tional value of ocean beaches, lake shores and river

stretches, contaminate water supplies and create fire haz-

ards. Congress has repeatedly indicated its high regard

for our water quality and, conversely, its disdain for its

pollution. United States v. Ira 8. Buskey & Sons Inc., 346

F, Supp. 145 (D.Vt. 1972).

The first statute specifically dealing with oil discharges

was the Oil Pollution Act of 1924 (33 U.S.C. §§ 431-437),

intended to protect the nation’s coastal waters from vessel

discharges. Congress next passed the 1948 Water Pollution

Control Act (33 U.S.C. § 466), which was amended in 1956

and 1961. In 1965 Congress enacted the Water Quality Act

establishing water quality standards for interstate waters.

1 See Charter, Sutherland & Porricelli Quantitative Estimates on Petro-

leom to the Oceans (1973), where it is estimated that each year

operational discharges account for 1,370,000 tons of oil while vessel

accidents account for about 350,000 tons.

A-22

The Clean Water Restoration Act of 1966 (33 U.S.C, §466)

amended the Oil Pollution Act of 1924.

The 1966 Act was superseded by the Water Quality

Improvement Act of 1970 (33 U.S.C. $1161), a more com-

prehensive Act wherein Congress declared the policy to be

“that there should be no discharges of oil into or upon the

waters of the contiguous zone” (33 U.S.C. §1321). The

1970 Act, as amended by the Federal Water Pollution

Control Act of 1972 (33 U.S.C. §1321), is the law applicable

to this case. This Act adopts the same measure of damage

as the 1924 Oil Pollution Act; however, the defenses are

more limited, reflecting a strict liability rather than a neg-

ligent standard.

The 1970 Water Quality Improvement Act, incorporated

into and modified by the Federal Water Pollution Control

Act of 1972, is a comprehensive plan attempting to ex-

pedite oil pollution cleanup and to establish a workable

scheme for limiting and distribu‘ ‘ng liability. As amended,

the Act prohibits any dischare of oil or other hazardous

substances into or upon the navigable waters of the United

States and adjoining shorelines or into or upon waters of

the contiguous zone, except where permitted under Article

IV of the International Convention for the Prevention of

Pollution of the Seas by Oil, as amended, or where per-

missible by presidential regulation (83 U.S.C. §1321).

Summarized, the Act provides that in cases where a

discharge of oil is not permissible under the Act, the owner

or operator of the applicable vessel or onshore or offshore

facility shall be liable to the United States for cleanup

costs, except if the owner or operator proves that the dis-

charge was caused by Act of God, Act of War, negligence

by the United States, or an act or omission of a third party

whether or not negligent or by any combination of those

causes. It provides that “Notwithstanding any other pro-

A-23

vision of law, liability of vessel owners to the United States

for the actual cost of removing oil or hazardous substances

discharged is limited to $100 per gross ton or $14,000,000-

.00, whichever is lesser,” and that limitation in the above

amounts will be denied where the United States can show

that the discharge was the result of “willful negligence or

willful misconduct within the privity or knowledge of the

owner” (33 U.S.C. §1321(f)(1)). With respect to third

party liability it provides that where the owner or operator

of a vessel or onshore or offshore facility proves that a

discharge was caused by an act or omission of a third

party, the third party shall be liable to the United States

and contains the same penalties and defenses as set out in

subsection (f) dealing with the actual spiller or discharger.

The statute is not a model of clarity. In the absence of

clarifying case law or legislative history on point, one can

only speculate as to the meaning of the “Notwithstanding

any other provision of law” clause. With respect to fed-

eral cleanup costs, it is uncertain whether Congress in-

tended the Federal Water Pollution Control Act to super-

sede the Limitation of Liability Act or whether it intended

both Acts to be read together so as to provide the greatest

relief to the United States. Because the two statutes serve

different purposes and differ substantially on crucial issues,

in all probability the United States is limited to recover

under the Federal Water Pollution Control Act, which

does not deny limitation for cleanup costs unless the dis-

charge is the result of willful negligence or willful mis-

conduct within the privity and knowledge of the owner.

As used in the Water Pollution Prevention and Control

Act, 33 U.S.C. §1251 et seq., and specifically as used in

section 1321, Oil and Hazardous Substance Liability, the

phrases “willful misconduct” and “willful negligence” have

not been defined. Counsel have not indicated any cases in

which the terms have been explained, and our research has

A-24

disclosed none. The phrase “willful misconduct”, however,

has been defined by this court with reference to cases aris-

ing under the Warsaw Convention, 49 Stat. 3000, Article

25(1), which excludes any limitation of liability if the

damage is caused by the carrier’s willful misconduct.

In those cases arising under the Warsaw Convention,

this circuit has established the following criteria for a find-

ing of willful misconduct: an act, intentionally done, with

knowledge that the performance will probably result in

injury, or done in such a way as to allow an inference

of a reckless disregard of the probable consequences.

Pekelis v. Transcontinental & Western Air, 187 F.2d 122

(2d Cir.), cert. denied, 341 U.S. 951 (1951). If the harm

results from an omission, the omission must be intentional,

and the actor must either know the omission will result

in damage or the circumstances surrounding the failure

to act must allow an implication of a reckless disregard

of the probable consequences. Pekelis v. Transcontinental

& Western Air, supra. The knowledge required for a find-

ing of willful misconduct is that there must be either actual

knowledge that the act, or the failure to act, is necessary

in order to avoid danger, or if there is no actual know!l-

edge, then the probability of harm must be so great that

failure to take the required action constitutes recklessness.

Berner v. British Commonwealth Pacific Airlines, Ltd., 346

F.2d 532 (2d Cir. 1965); Pekelis v. Transcontinental &

Western Air, supra.

In this case, the questions are whether Red Star’s omis-

sions, specifically its failure to inform Kiernan of Reimer’s

unfamiliarity with the river, its failure to appoint a cap-

tain, and its failure to require a lookout under the cir-

cumstances, were done intentionally, and whether Red Star

knew such a combination of omissions would likely result

in damage; or whether, if Red Star did not have actual

knowledge, it should have recognized the probable conse-

A-25

quences, and that, therefore, the failure to act constituted

a reckless disregard of those probable consequences. We

think it did.

With regard to whether the failure to act was intentional,

Keenan, Red Star’s night dispatcher, knew the facts and

determined that the tug was suitable for the voyage. Fur-

thermore, even after the tug had left port, any one of Red

Star’s dispatchers could have called Kiernan to inform

him of Reimer’s inexperience on the river. Given that

Keenan knew of Reimer’s unfamiliarity, that the day dis-

patcher had told Keenan that Kiernan was to be captain,

that a ship-to-shore radio was available to communicate

this information, even if Keenan had merely forgotten at

the time of assigning the Ocran Prince to the trip, and

had said nothing to either Kiernan or Reimer, Keenan’s

omission and his failure to correct it must be considered

intentional. Koninklijke Luchtvaart Maatschappij N.V.

KIM v. Tuller, 292 F.2d 775 (D.C. Cir.), cert. denied, 368

U.S. 921 (1961). Additionally, we have previously held

(as the lower court expressly found) that a lookout was

required under the existing circumstances, and that fail-

ure to post a lookout was a violation of a statutory duty.

Sin¢e Red Star was aware of the practice of sending the

deckhand for coffee, failed to take any steps to alter that

practice, and knew the absence of a lookout was unsafe

under the existing conditions, its failure to require the

lookout posted must also be considered intentional. Amer-

ican Airlines v. Ulen, 186 F.2d 529 (D.C. Cir. 1949).

The circumstances surrounding this trip warrant an

inference that Red Star acted in reckless disregard of the

probable consequences. Red Star’s management failed to

designate the captain of the tug and failed to inform

Kiernan of Reimer’s unfamiliarity with the river. Red

Star knew that deckhands were sent below for coffee,

thereby eliminating them as a lookout, yet failed to take

A-26

any steps to halt this practice. Given the conditions at

the time of the accident—the ice along the bank, the pos-

sibility of the buoys having been moved by the ice, the

darkness, and the ebbing tide—all of which Red Star knew

or should have known, Red Star’s failure to act allows

an inference of a reckless disregard of the probable con-

sequences.

It must be made clear that the determination of willful

misconduct does not rest solely because of Reimer’s un-

familiarity with the river, cf. Goepp v. American Over-

seas Airlines, 281 App. Div. 105, 117 N.Y.S.2d 276 (1952),

aff’d., 305 N.Y. 830, 114 N.E.2d 37, cert. denied, 346 U.S.

874 (1953), nor does it attach necessarily because of any

navigational mistakes, cf. Grey v. American Airlines, 227

F.2d 282 (2d Cir. 1955), cert. denied, 350 U.S. 989 (1956).

This case is unlike Grey v. American Airlines, supra, in

which the court found that even if there had been pilot

error, that fact, by itself, did not necessarily constitute

willful misconduct. It is, rather, the combination of fac-

tors which together indicate a probable consequence of

damage resulting from several failures to act, and by

continuing to fail to act in the face of that probability,

that indicates a reckless disregard of the consequences.

While any one of the faults of Red Star alone, even

within privity, may not constitute “willful misconduct”,

on the entire record the various inactions and gross dis-

regard of the potential harm amount, in our opinion, to

willful misconduct within the meaning of the statute.

Otherwise, it would be difficult to imagine what would be

necessary to make a tug company liable for the costs of

cleaning a negligent oil spill save an admission of an

actual intent to do so, and would extend to the tugboat

industry an almost absolute exemption from liability for

pollution cleanup costs.

A-27

In summary, we hold that the order of the district court

that Red Star is entitled to limit liability with respect to

Pittston’s claim and also the United States’ claim for pol-

lution cleanup costs should be vacated and that an order

be entered denying Red Star the right to such relief;

directing the entry of judgment in favor of Pittston and

the United States for the amount of their damages; and

that the district court’s judgment in all other respects be

affirmed.

Reversed in part, affirmed in part, and remanded for

further proceedings consistent with this opinion.

B-1

APPENDIX B

UNITED STATES DISTRICT COURT

SovutHerN District or New York

Nos. 74 Civ. 33858 (GLG) anp

75 Civ. 5801 (GLG)

SAME TITLE

[Officially Reported at 436 F. Supp. 907]

September 6, 1977

Finpines or Fac

GortreL, District Judge.

1. At all material times Tug Ocean Prince, Ine. was,

and still is, a New York corporation and the owner of the

Tug Ocean Prince. Red Star Towing & Transportation

Company (hereinafter collectively referred to with Tug

Ocean Prince, Inc. as “Plaintiffs”), was, and still is, a

West Virginia corporation with an office and principal

place of business in New York, and at all material times

was the charterer of the Tug Ocean Prince, and manned,

victualed, supplied and operated said Vessel.

2. The Tug Ocean Prince is a United States documented,

steel hulled, diesel driven, single screw, 1,800 horsepower

tugboat built in 1958, having an overall length of 94.7

B-2

feet, an extreme breadth of 27.1 feet and a deep draft of

about 13 to 14 feet. Her registered gross tonnage is 198

tons and her registered net tonnage is 134 tons.

She was at all material times equipped with direct pilot-

house engine controls, a gyro compass, a magnetic com-

pass, a Decca radar and a searchlight. Her chart for the

area was a 1969 edition. Although a subsequent edition

was available, there were no material differences between

the charts in the location and characteristics of the rele-

vant aids. Buoy “21” had been renumbered to Buoy “25”.

3. Red Star had no written procedure for supplying its

tugs with navigational information or material, The order-

ing of charts was left to the captain without the office hav-

ing a system to check what charts and other navigational

publications were needed. Red Star had no procedure for

checking that this material was obtained by the Captains.

On the voyage in question, the Ocean Prince was carrying

current editions of the Light List and Coast Pilot.

4. Red Star Towing & Transporation Company (herein-

after singly referred to as “Red Star”) is engaged in the

business of general towage in the coastal and inland waters

of the United States, including New York Harbor and its

tributaries.

5. Red Star Marine Services, Ine. is a company which

at all material times provided “management services” for

Red Star, including “operations” such as booking of work,

scheduling and dispatching of tugs to accomplish that work,

hiring and firing of personnel, and overseeing the total

operation of the Red Star fleet which includes the Tug

Ocean Prince.

6. Red Star and Red Star Marine Services, Inc. are

related companies, and have the same president, Mr. Rob-

ert W. Sanders.

B-3

7. Walter Kristiansen at all material times was vice-

president of operations of Red Star Marine Services, Ine.

8. The Red Star companies are also related to the

Bushey shipyard at Brooklyn, New York and the various

Bushey companies in the New York Harbor area.

9, Red Star has offices at 500 Fifth Avenue, New York,

New York, where its tug dispatchers are located.

10. The dispatchers of another related company, at all

material times, were located in the same offices, and used

the same radios and frequencies.

11. Captains, Relief Captains, Mates and other crew

members serving on Red Star tugs are hired by Red Star

Marine Services, Inc. but are paid by Red Star.

12. Red Star Marine Services, Ine. had internal require-

ments for the hiring of navigators, which included a re-

quirement that Tug Captains and Mates it employed either

have or obtain a Coast Guard license for the operation

of Red Star tugs as a condition to their employment, whieh

company policy preceded subsequent Coast Guard licens-

ing requirements. In addition, when one of the naviga-

tors was unfamiliar with the area the tug was dispatched

to, Red Star’s policy was that the other navigator have

extensive experience in and be familar with the area, and

that this man be available to assist the other navigator

whenever necessary or if requested by the man on watch.

13. Pittston Marine Transport Corporation (hereinafter

“Pittston”) is a New York corporation and, at all mate-

rial times, was engaged in the business of transporting

petroleum cargoes by barge in, among other places, New

York Harbor and its tributaries. At all material times

B-4

Pittston owned, operated, manned, victualed and supplied

the tank barge New London, of 1,665 gross and net tons

and having overall dimensions of 295 feet in length and

43 feet in breadth. The Barge is equipped with a pushing

well or notch at its stern into which the bow of a pushing

tug fits, providing motive power and steering control.

14. The United States of America (hereinafter the

“Government”) is a sovereign which, under the auspices

of the Coast Guard, establishes, maintains and operates

an aids to navigation system on the entire length of the

Hudson River in the State of New York. It does so under

statutory authority to serve, inter alia, the needs of the

commerce of the United States. (14 U.S.C. § 81).

15, On February 2 and 3, 1974, the Tug Ocean Prince

carried a full crew of six men including two United States

Coast Guard licensed (for uninspected towing vessels not

more than 200 miles off-shore) navigators, John Kiernan

and Walter Reimer, two deckhands, an engineer and a

cook.

16. At all relevant times, Mate Reimer held a valid

license issued by the United States Coast Guard which

gave him authority to serve as operator of uninspected

towing vessels upon the inland waters of the United

States, including the Hudson River. Reimer had been a

Tug Captain for five years, and was qualified generally to

serve as a Tug Captain, although he had never before

navigated the Hudson River. He had served as a deck-

hand on tankers on he Hudson River briefly some six

years earlier. He worked for Red Star in the capacity of

Captain, Relief Captain and Mate, principally on board

the Ocean Prince, for a period of one and one-half (114)

years before the voyage in question.

B-5

17. Kiernan was also licensed by the Coast Guard and

had extensive experience as a Tugboat Captain on the

Hudson River which spanned a period of more than 30

years. He was employed by an associated company as 8

Tug Captain, but was temporarily assigned to Red Star

to fill a vacaney on the Tug Ocean Prince and went on

board on February 1, 1974.

18. During the voyage in question, Kiernan and Reimer

stood alternating six hour watches, with Kiernan standing

the 6:00 to 12:00 watches in the morning and evening and

Reimer standing the 12:00 to 6:00 watches. One deckhand

was assigned to each watch, The Captain or Mate of the

watch did the steering and navigating. The deckhand per-

formed various chores, such as line handling, general main-

tenance on board the tug, and, if requested by the Captain

or Mate, lookout duties, steering under the Captain s or

Mate’s supervision, and getting coffee, all of which were

well known to Red Star’s vice-president of operations.

19. Prior to the voyage in question, the ‘Tug Ocean

Prince had operated in southern waters, in Georgia,

Florida, Texas and Louisiana for over a year, During

December of 1973 and January of 1974, it operated in and

about New York but Reimer was on vacation at that time.

He rejoined the Tug in New York on February 2, 1974

at the Bushey shipyard in Brooklyn. Kiernan was already

on board. Kiernan had never met Reimer before Febru-

ary 2, 1974, but knew that he was regularly assigned to the

Ocean Prince. He was not advised and was unaware of

Reimer’s lack of familiarity with the Hudson River.

20. While the plaintiffs knew that Reimer lacked fa-

miliarity with the Hudson when he rejoined the Ocean

Prince on February 2, it was assumed that this lack of

B-6

experience would be discussed between Reimer and Kier-

nan when they met on the vessel.

21. Red Star’s Personnel Department was responsible

for designating the Captain of the Vessel. Red Star in-

tended Kiernan would be Captain. Kiernan indicated

doubt in his own mind that he was Captain, but he took

certain steps which were appropriately done by the Cap-

tain. It is the Captain’s duty to know the experience and

qualifications of the Mate. |

22. On Friday, February 1, 1974, Pittston phoned in an

order to Red Star, advising that it would need a tug to

tow its Barge New London to Kingston, New York some-

time during the weekend. The order was entered on a

job order card, which was given to the tug dispatcher’s

office. In response to Pittston’s order, the dispatcher,

Philip Keenan, decided to assign the Tug Ocean Prince

to do the job, and did so at 1800 hours on February 2nd.

Keenan did not discuss with Kiernan or Reimer who was

to be Captain and who the Mate.

23. Kiernan was aware of the make-up of the pilot-

house crew on the Ocean Prince on February 2nd, and had

been told by the day dispatcher, Robert Fitch, that Kier-

nan was Captain and Reimer was Mate. Keenan was

aware of Reimer’s lack of experience as a navigator on

the Hudson. He decided, however, that the Ocean Prince

would be suitable for the voyage since Kiernan, who had

extensive experience as a tug navigator on the Hudson

River, was on board and would be available to assist

Reimer if necessary. He also assumed Reimer’s lack of

experience on the Hudson River would be discussed be-

tween Kiernan and Reimer. The dispatcher’s decision to

assign the Ocean Prince to the New London job was in

B-7

accordance with accepted practice in the tugboat industry

of dispatching a tug to an area one of the navigators had

not navigated before so long as the other navigator on

board has experience in the area,

24. From the Bushey shipyard the Ocean Prince, with

Kiernan on watch, proceeded to Esso dock in Bayonne,

New Jersey, and made up to the loaded Barge New Lon-

don. Reimer, who was offwatch, nevertheless assisted the

deckhands in making up the tow, and then went below

when the Tug and Barge left on the voyage to Kingston,

New York,

25. The New London was taken in tow forward of the

Ocean Prince in push-tow fashion with the bow of the

Tug snuggly secured in the Barge’s stern notch with steel

cables and several parts of synthetic lines. The overall

length of both Vessels was about 385 feet, with steering

and propulsion being supplied by the Tug. Both Vessels

had a combined gross tonnage of 1,863. The Barge had a

draft of about 12 feet. In its loaded condition, the Barge

had only two feet freeboard and the view ahead from the

Tug’s pilothouse was unobstructed.

96. John Kiernan was in charge of the navigation dur-

ing the first leg of the voyage which commenced at 1915

hours. At 2330 hours, Mate Walter Reimer came to the

pilothouse of the Tug and relieved Captain Kiernan of the

wateh. Kiernan remained with Reimer for about 15 min-

utes, and then retired without any discussion of naviga-

tion on the river. The Tug and her Tow were approach-

ing Haverstraw, New York at the time. The Tug, with

Reimer now in charge of navigation, continued the trip

northbound past Peekskill, New York and through Bear

Mountain Bridge. At about this time, Reimer sent his

B-8

deckhand to the galley to get coffee, leaving Reimer alone

in the wheelhouse.

Reimer did not ask Kiernan to stand the watch for him,

athough Kiernan would have if asked. This is customary

practice aboard towboats, At all relevant times the tide

was ebbing, there was ice in the river, and visibility was

two miles with snow flurries. The Tug was making good

a speed of about 6 knots over the bottom (the Vessels

were proceeding against the current). At this time the

Tug’s radar was operating and in use. A navigation chart

for the area was open and in use. Reimer was able to see

both shorelines of the river to port and starboard and was

also able to see over the full length of the Barge and a

safe distance ahead. He was using his radar from time

to time to confirm his visual sightings and to locate aids

to navigation and other points of reference ahead. At all

times the Tug’s radar, steering system and engine con-

trols were operating properly.

27. Reimer had not attended any navigation school and

never had any formal training in the use of the radar, but

was familiar with its operation.

28. The river north of the Bear Mountain Bridge is

bounded on both sides by mountains. There was ice flow-

ing on the river with heavy accumulations along parts of

the shorelines.

Dead ahead of the Bear Mountain Bridge, west of the

navigable channel, approximately one and three-quarter

miles north of the Bridge is an obstruction consisting of

a pinnacle rock or rocky area, the apex of which is 7 feet

below the mean low water line and not visible to vessels

in navigation. It is located east of a wide shoal area

along the west shore which also is not visible from the

B-9

surface. The rock obstruction and shoal aren west of it

projects almost 400 yards into the river from its westerly

shore.

About 600 to 800 yards north of the rock is lighted

beacon #27 located on the easterly shore of Con Hook

Island. The light is 46 feet above the water according to

the Light List and is visible to a tug from the town of

Manitou about 1.3 miles south.

The River is 800 yards wide off Mystery Point, and

narrows to 450 yards off Con Hook Island. The channel

east of the rock described above, which is located between

Mystery Point and Con [look Island, is about 500 yards

wide. The river depth in this area varies between 35 feet

and 127 feet.

29. The rock presents a dangerous hazard and obstruc-

tion to navigators in the Hudson River, apparent on the

chart and well known to mariners familiar with the waters

and to the Coast Guard.

30. The obstruction is marked by the “25” lighted buoy,

which was established and is maintained and operated by

the Coast Guard for the purpose of marking the rocky

obstruction near the channel. The buoy also marks the

westerly extreme of the navigable channel and a bend in

the river. The “25” light buoy is replaced by the Coast

Guard annually in December at the commencement of the

ice season by an unlighted second class black can buoy.

The can buoy was in use on February 3, 1974, This change

is noted in the Light List.

81. Reimer knew of the existence of the buoy on the

chart and the obstruction it designated.

B-10

32. As the Tug and her Tow passed abeam Mystery

Point, Reimer did not locate the “25” can buoy either

visually or on the radar. Because the said buoy marks a

dangerous obstruction as well as a bend in the channel,

Reimer reduced engine speed, turned on the Tug’s power-

ful spotlight to illuminate the area ahead, and continued

to search for the buoy visually and by radar,

33. Shortly afterwards, at about 0130 on February 3,

1974, the Barge struck the rock on its port bow resulting

in damage to the Barge’s forepeak and # 1 and 2 port

side cargo compartments. After impact, Reimer sighted

the buoy to the starboard partially visible in the ice near

the Vessel’s wake. He assumed that the Barge and the

Tug in making the turn to starboard after the incident

had freed the buoy from the ice.

34. The buoy was obscured by ice and was not seen

by Reimer as the Tug and Tow approached it. The ice

flow and ice accumulation along the shorelines including

north of Mystery Point on the easterly shore partially ob-

scured the image of the shoreline both to the eye and on

radar.

35. Immediately after the casualty Kiernan was sum-

moned and return to the pilothouse. He saw the lighted

tower of Con Hook Island ahead and the “25” black can

buoy about 50-75 feet off the starboard beam of the Tug.

The Vessels were still on a northerly heading at the time.

After turning around, the lights on the Bear Mountain

Bridge about 2 miles south of the Tug’s position were

also visible. Kiernan brought the Tug and Barge to the

Day Line Pier south of the casualty site where they re-

mained until the New London was partially lightened into

another barge later in the day.

B-11

36. The grounding of the Barge New London resulted,

in part, from Reimer’s lack of knowledge of local land-

marks and experience on the Hudson River.

37. Reimer did not examine the Light List or the Coast

Pilot very carefully because he was unfamiliar with the

warning therein not to rely solely on buoys and the warn-

ing that ice covers the buoys in this area during the win-

ter.

38. Reimer failed to post a lookout when conditions

were such that same was required.

39. A navigator who is about to enter strange waters

should familiarize himself with the applicable charts, the

Light List and the Coast Pilot.

40. The Light List contains a number of warnings to

the navigator including the following:

“It is imprudent for a navigator to rely on floating

aids to navigation to always maintain their charted

position and to constantly and unerringly display

their advertised characteristics. The obstacles to

perfect performance are of such magnitude that

complete reliability is manifestly impossible to

achieve. Buoys are liable to be carried away, shifted,

capsized, or sunk as the result of storms, ice condi-

tions, collisions, or other accidents.

“All buoys should, therefore, be regarded as warn-

ings or guides and not as infallible navigation marks ;

especially those located in exposed positions. When-

ever possible, a ship should be navigated by bear-

ings or angles on fixed objects on shore and by

soundings rather by reliance on buoys.”

B-12

41. The Light List also states that the lighted buoy “25”

(Aid, No. 1874) is “replaced by an unlighted ean from Dee.

15 to April 1.” It also shows that the fixed light No. 27

on Con Hook Island is on a black skeleton tower, the top

of which is 46 feet above water.

42. With respect to the ice on the Hudson, the Coast

Pilot states:

“The ice season usually starts in early January

and ends in mid-March. Normally shipping is af-

fected most seriously in the Hudson River between

Tappan Zee and Albany. In addition to the problem

of getting through the ice, aids to navigation are

covered or dragged off station by moving ice. Buoys

are removed from the Hudson River during the ice

season then reset in late March when the ice clears.

However, the river is well marked by lights along

the shore.” (p. 235).

43. The rock obstruction marked by the “25” ean buoy

is located in an area which is susceptible to ice accumula-

tion on the ebb tide because an “eddy” is created south of

Con Hook Island which results in ice buildup. On the ebb

tide, ice accumulation north of Mystery Point on the east

shore, directly across the channel from the rock, also oe-

curs. These conditions are known to the Coast Guard and,

on occasion, result in the obscuring of the buoy on the west

and a distortion of the shoreline on the east.

44, With respect to Con Hook Island, the Coast Pilot

makes the following observation:

a rock, with a depth of 7 feet over it and marked

by a lighted buoy, is about 0.3 mile southward of

Con Hook, When descending the river, particularly

B-18

with a fair current, there is a tendency to set toward

the rock; caution is advised.”

45. At no time prior to the grounding did Mate Reimer

see the flashing light on Con Hook Island, north of the can

buoy “25”.

46. The proximate and predominate causes of the

grounding were errors in navigation. These errors in turn

were the result of an error in management, whereby a

navigator inexperienced with the waters was given no as-

sistance from an experienced navigator then on board in

traversing a portion of the river that was dangerous under

the circumstances then existing.

47. With proper use of radar, Reimer could have gotten

a radar range from the Bear Mountain Bridge with reason-

able accuracy. With a radar range off Bear Mountain

Bridge and a visual bearing on Con Hook Light it would

have been possible to construct a danger bearing to keep

the Vessel off the rock. However, since the Tug, as most

tugs, was not equipped with a gyro repeater or a pelorus

it was difficult to take accurate visual bearings.

48. The obseuring of the buoy by ice contributed to the

grounding in that if the buoy had been visible it. would

have indicated to Reimer he was off course and to the west

of the channel.

49, The casualty involving the New London was the

third grounding at the same location involving similar cir-

cumstances during the prior 20 years. One year before the

grounding of the New London, on February 26, 1973, the

loaded gesoline Barge George T. Tilton, while being push-

towed by the Tug Bart Turecamo, struck the rock marked

B-14

by the “25” black can buoy, causing damage to the Barge

and pollution. Coast Guard records show the buoy was

reported to be under the ice at the time of the grounding.

50. In January, 1969, the Coast Guard Cutter Sassa-

frass went aground on the same rock due to a navigational

error with the buoy in plain view.

51. In December, 1963, the Coast Guard Cutter Sauk

went around at the same location. In this case, it was re-

ported to the Coast Guard that the can buoy in question

was under the ice. In investigating the incident, the Coast

Guard learned that several other casualties at the same

rock preceded the Sauk grounding, although those incidents

occurred in the 1920’s and 1930’s and the conditions exist-

ing therein were not developed.

52. Similarly, in January, 1976, the Barge Robert L.

Poling, while in tow of the Tug Joan Moran went aground

on the same rock. Coast Guard records show that the buoy

was reported to be almost completely submerged under

the ice at the time of the grounding.

53. During the following winter a major oil spill oe-

curred at the same location, but the facts of that incident

were not developed at trial.

54, The can buoy is the best practical floating aid for

the site, available under present technology. <A fixed tower

on the rock, the base of which would be in 7 feet of water,

would be damaged or destroyed by ice.

55. In light of the difficulty in keeping this floating aid

to navigation visible during the winter season, there were

available other navigational aids which could have been

B-15

established on land which would better aid the mariner in

staying in the channel.

56. The Coast Guard has not established any ranges or

lights on the eastern shore in the immediate area approach-

ing can buoy “25”.

57. The Government publication of Waterborne Com-

merce of the United States shows the following with re-

spect to the number of trips passing the Con Hook area:

Vessels and tug and barge flotillas travelling between

Upper Bay, New York Harbor and Waterford, New York

Up Bound Down Bound

1971 70,586 73,081

1972 57,779 59,378

1973 61,741 62,468

1974 55,578 55,306

Total 4 years 245,684 250,233

Of these 118,435 were upbound tug and barge flotillas and

166,133 were down bound tug and barge flotillas with drafts

of 18 feet or less.

58. As a result of the New London striking the rock,

oil leaked from the Barge into the river. Notice of viola-

tion was given to Pittston on August 27, 1974; written re-

sponse was submitted by Pittston and a hearing was held

on September 26th; thereafter a civil penalty of $5,000.00

was assessed and notice of Pittston’s right to appeal the

venalty was given to Pittston. Pittston appealed the as-

sessed penalty. The Commandant of the Coast Guard de-

nied the appeal.

B-16

OPINION

To summarize the major events giving rise to this litiga-

tion, on February 3, 1973, the barge New London, loaded

with oil and in the tow of the Tug Ocean Prinee, ran

aground on a submerged rock formation in the Hudson

River. The buoy, placed by the Coast Guard to mark the

obstruction, was apparently obscured by ice. The impact

caused the New London to leak oil, fouling the river. The

Government undertook the cleanup operation. This se-

quence of events raises some difficult questions of maritime

liability and novel issues of interpretation of the Water

Quality Improvement Act of 1970.!

Tug Ocean Prince, Inec., as owner, and Red Star Towing

& Transportation Company, as charterer of the Tug Ocean

Prince, seek exoneration from liability on the ground that

the accident was caused by the Government’s failure to

maintain adequate aids to navigation. (They are referred

to hereafter simply as “Plaintiffs”). Alternatively, they

seek to have their liability limited to the value of the tug,

claiming that the grounding resulted from the cause out-

side their privity and knowledge. Claimant Pittston secks

to recover the value of all the oil lost from its barge either

from the plaintiffs or from the Government. The Govern-

ment seeks the substantial costs of the oil pollution cleanup

fron: the other parties and a civil penalty from Pittston.

Pittston, in turn, seeks indemnity from the plaintiffs for

any liability it may have to the Government because of the

oil spill.

133 U.S.C.A. § 1151 et seq., (Supp. 1977). It is conceded that

all claims fall within the admiralty jurisdiction of this court, Fed.R.

Civ.Proc. 9(h) and arise under 33 U.S.C.A. § 1321 (Supp. 1977)

46 U.S.C. § 183 et seq. and 46 U.S.C. § 742 (1970).

‘N

B-17

The trial was bifurcated and issues concerning damages

reserved for later consideration. The liability issues will

be considered separately.

Plaintiff's Claim for Exoneration or

Limitation of Liability

The grounding of the barge New London was caused

by a grave error in navigation by the Mate Reimer.

Unfamiliar with the locale, deceived by ice build-up along

the shore, he allowed the tow to stray to the west of the

channel while he concentrated on attempting to locate a

buoy which had apparently become obscured by drifting

ice floes. His concentration on locating the buoy was ill

adivsed in light of the fact, clearly set forth in the Coast

Pilot, that buoys in this area (the Hudson River between

Tappan Zee and Albany) get covered and moved off sta-

tion at that time of year by moving ice. Even without

the warning in the Coast Pilot, a mariner familiar with

the river would not have relied on the buoy at this time of

year under the existing conditions.

[1] While the plaintiffs contend that the inability to lo-

cate the buoy was the proximate cause of the grounding,

it is clear that the errors of navigation were the proxi-

mate cause. The obscured buoy was merely a “but for”

factor which had it been visible might have corrected the

navigational errors. It cannot be said, therefore, that in-

ability to use the aid to navigation was the proximate

cause of the incident. American Smelting & Refining Co.

v. 9. S. Irish Spruce, 548 F.2d 56 (2d Cir. 1977). Because

the accident was not inevitable, but was instead due to

negligence, plaintiffs are not entitled to exoneration from

liability. The Grace Girdler, 74 U.S. 196, (7 Wall.) 441, 18

L.Ed. 790 (1868); The Jumna, 149 F. 17 (2d Cir. 1906).

Whether the plaintiffs are entitled to indemnity from the

B-18

Government under the Suits in Admiralty Act, 46 U.S.C.

§§ 741-52, because of its failure to provide a more reliable

aid to navigation, will be considered subsequently.

Having concluded that plaintiffs are not entitled to ex-

oneration from liability, we turn to the related question

of whether plaintiffs are nevertheless entitled to limit their

liability pursuant to the Limitation of Liability Act, 46

U.S.C. 4 183 et seq.

The operation of tug boats differs in several material

respects from that of ocean going vessels. Because tugs

are kept in operation so steadily and the watch standers

work such long hours (twelve a day) it is necessary to

have two complete sets of crews changing every two weeks,

as well as alternates for vacation periods. The crew ordin-

arily includes two watchstanders, a Captain and a Mate,

who alternate six hour watches. While on watch they

usually not only command and navigate the tug but also

serve as helmsmen “steering” the vossel. Necessarily this

limits the amount of instrument navigation and plotting

of position possible. For this reason such tugs are not

usually equipped with gyro repeaters or peloruses for tak-

ing positions. Navigation is done by sight of eye, pilot-

ing from known landmarks and aids to navigation. Conse-

quently, intimate familiarity with the waters and hazards

is far more important than in ocean navigation. An un-

familiar helmsman requires assistance from an experi-

enced one. It is the responsibility of the Captain to see

that the inexperienced navigator (who could be himself )

gets such assistance. This responsibility, along with cer-

tain administrative chores, is one of the few distinguish-

ing factors between the duties of a Captain and those of

a Mate.

Plaintiffs appreciated this factor in assigning a crew

to the Ocean Prince, but an unfortunate set of cireum-

B-19

stances created unforeseen confusion relating to which of

the watchstanders was to assume the position of Captain.

Much of the uncertainty stemmed from the fact that

Reimer, one of the watchstanders on the night in question,

had been a regular pilothouse watch stander aboard the

Ocean Prince. He had served as both Mate and Captain

when the vessel was stationed in the South. After Reimer

had left for an extended vacation, the vessel was brought.

to New York. Reimer had no experience in piloting the

Hudson.

The day before Reimer returned to the Ocean Prinee,

the Mate then aboard took leave. Needing an experienced

man, plaintiffs called upon an associated company to sup-

ply a suitable person, It sent John Kiernan, a tugboat

captain with 30 years experience on the Hudson River.

When Kiernan came aboard on February 1, 1974, the pre-

ceding Captain was still there, so Kiernan started as Mate.

The next day Reimer rejoined the vessel and the Captain

left. Kiernan knew that Reimer was a full-time employee

of plaintiff, regularly assigned to the vessel, and qualified

to act as its Captain. He did not know that Reimer had

not been aboard the vessel during the couple of months

it had been operating on the Hudson or that he had never

navigated the Hudson on any vessel.

The vessel commenced the voyage in question shortly

after Reimer came on board and, during the half day pre-

ceding the grounding, the two had only two brief discus-

sions. Kiernan contends that, since he was only a replace-

ment, and it was Reimer’s regular vessel, he believed

Reimer was the Captain. Kiernan, however, occupied the

Captain’s cabin, stood the watch traditionally taken by

the Captain and performed certain administrative tasks

which were the Captain’s responsibility. (Kiernan main-

tains that he was forced to assume these tasks after the

B-20

grounding due to Reimer’s extremely upset emotional

state). While Kiernan vaguely claims he alerted Reimer

when the watch changed to the general navigational situ-

ation ahead, his testimony in this regard was not credible,

particularly in light of his professed lack of knowledge

of Reimer’s unfamiliarity with the river.

It remains a mystery why Reimer did not seek assist-

ance as navigation became progressively more difficult due

to the treacherous river conditions. (The issue could not

be explored because Reimer, who is no longer in plaintiff's

employ, was beyond the subpoena power of the court and

did not testify at trial.) His evidence was offered through

two lengthy depositions, but in neither of these did any of

the counsel explore his motivation in proceeding alone at

night up a strong ice-choked river, while aware that he was

not picking up the next aid to navigation along the route.

One possible answer lies in his having sent his deckhand

down to the galley to make coffee prior to the grounding.

(He returned, apparently just about the moment of the

grounding.) Had the deckhand been available, he could

have taken the wheel while a radar range was taken, or

been sent forward as a lookout, or, as the best course,

been sent to get Kiernan out of his bunk. Had Kiernan

been brought to the wheel house, it is very likely he would

have quickly detected that they were to the west of the

channel and that the buoy was obscured by drifting ice,

The question remains whether Reimer’s error in judg-

ment is attributable to plaintiff. If so, it is a factor within

plaintiff's “privity or knowledge” and a ground for deny-

ing limitation of liability under the Limitation of Lia-

bility Act, 46 U.S.C. § 183 et seq.

B-21

Limitation of Liability

The cla'mant and the Government maintain that limita-

tion should be denied because Reimer’s inexperience ren-

dered the vessel anseaworthy. They contend that plain-

tiff’s failure to post a lookout violated Title 33 U.S.C,

§ 221. They also claim that plaintiffs had failed to provide

proper charts aboard the tug, These contentions will be

discussed in order,

[2] The burden is clearly upon plaintiffs, in a proceed-

ing under Title 46 U.S.C. § 183, to establish their own

lack of privity or knowledge in order to limit their li.

ability. Coryell v. Phipps, 317 U.S. 406, 63 S.Ct. 291, 87

L.Ed. 363 (1943). In Spencer Kellogg & Sons, Ine. v.

Hicks, 285 U.S. 502, 52 S.Ct. 450, 76 L.Ed. 903 (1982),

the Supreme Court, while denying limitation in that case,

nevertheless distinguished situations in which an “emer-

gency must be met by the master alone. In these there

is no opportunity of consultation or cooperation or. of

bringing the proposed action of the master to the owner’s

knowledge, The latter must rely upon the master’s obey-

ing rules and using reasonable judgment.” Jd, at 511-12,

52 S.Ct. at 453. Plaintiffs claim that the collision at

issue here presented just such an emergency and con-

tend that it is questionable whether there were any pre-

ventative measures which could have been taken to avoid

the accident.

Claimants and the Government maintain that Reimer’s

general unfamiliarity with the Hudson, rather than a

specific error of navigational judgment, was the direct

cause of the accident. Following this line of argument,

they contend that his inexperience created a condition of

unseaworthiness which was within the privity and knowl-

edge of plaintiffs. While this view finds support in a

B-22

nineteenth century case, The Lady Pike, 88 U.S. 1, 21

Wall. 1, 22 L.Ed, 499 (1874), modern authority has re-

jected it. In The Temple Bar, 137 F.2d 293 (4th Cir.

1943) the court stated:

“(T]he decision [The Lady Pike] cannot be ac-

cepted as authority for the broad proposition that

it is negligent to put a master in charge of a ship,

whatever the voyage, unless he is familiar with all

the local conditions he may be expected to en-

counter, If, as in the case at bar, a master, quali-

fied in other respects, is placed in command, and

if he is supplied with charts and publications suf-

ficient to enable a competent man safely to navi-

gate the ship, it is not necessary that he should

have prior knowledge of local conditions; and lack

of it will not cause the ship to be unseaworthy.”

Id. at 297.

It is clear that the court did not base its finding of

the Master’s competence on his familiarity with the as-

signed route. The court required, instead, that the Master

be qualified in other respects (not specified) and that

owner stock the ship with relevant charts and naviga-

tional publications,

[3] Plaintiffs maintain that they have fulfilled these

conditions. Reimer is a licensed tug captain with several

years’ experience in tugboats. He had available charts and

publications which clearly designated the location of the

submerged rocks. Moreover, he was clearly aware of the

hazard because he had been searching for the can buoy

for a substantial period prior to the grounding. A failure

to perceive the hazard might have been indicative of gen-

eralized incomptence which would have created an unsea-

worthy condition. An inadequate response to a known

B-23

danger presents an error in navigational judgment and, as

such, falls outside the owner’s privity and knowledge. As

stated by a definitive treatise in the field:

“The navigation of the vessel is under the abso-

lute control of her master... and no case has been

found where a shipowner, individual or corporate,

has been denied limitation because of a liability aris-

ing out of an error of management or of navigation

on a voyage committed by an employee whom the

owner was warranted in believing to be competent

with knowledge of his duties.”

3 Benedict on Admiralty § 42 at 5-25 (6th ed. 1975).

Defendant also argues that plaintiffs failed to provide

proper charts aboard the tug. Reimer denied this asser-

tion in his depositions and claimed that he had referred

to both a chart of the Lludson which designated the loca-

tion of the rock and the Coastal Pilot and Light List. The

Coastal Pilot and Light List state that during the winter,

can buoys become submerged in the ice and cannot be

seen. It appears that Reimer was not aware of this con-

dition. But this was due to his own negligence in not re-

ferring to the manual, rather than the owner's negligence

in not providing it. Since the materials were on board, it

is clear that the owner’s duty was satisfied. The question

is whether the equipment on board was “reasonably fit

under the circumstances” :

“Neither the absence of an additional watch officer

nor the location of the rudder angle indicator in-

volved negligence or rendered the vessel unseaworthy.

Although the presence of an additional officer or the

relocation of the indicator might have reduced the

possibility of collision, that is not the standard by

which we are to determine whether Farrell [the

B-24

owner] is entitled to limitation. Rather, we must

ask whether the procedures and equipment utilized

rendered the vessel reasonably fit under the cireum-

stances ... the vessel as equipped was reasonably

capable of performing the intended mission if prop-

erly operated, The accident resulted from lack of

care and failure to exercise proper procedures by

those on the bridge. For this Farrell is liable, but it

is also entitled to limit.” (emphasis added; footnote

omitted.)

Farrell Lines, Ine, vy. Jones, 580 F.2d 7 (5th Cir. 1976)

at 12-13. See also United States vy. Sandra & Dennis Fish.

ing Corp., 372 F.2d 189 (1st Cir, 1967).

Defendants also contend that there existed a violation

of Title 33 U.S.C. § 221 which provides in pertinent part:

“Nothing in these rules shall exonerate any vessel

or the owner or master or crew thereof, from the

consequences of . . . any neglect to keep a proper

lookout. . . .” eae.

Mate Reimer was alone in the wheelhouse at the time

of the casualty since he had sent the deckhand, Hebert,

below to make coffee.

The parties appear to have assumed, with some support

from precedent (see Dwyer Oil Transport Co. v. The Edna

M. Matton, 255 F.2d 380 (2d Cir, 1958); The Supply No.

4 (The Dalzellea), 109 F.2d 101 (2d Cir. 1940)) that there

is no compliance with the statute where a tug master

simultaneously serves as a lookout. It seems somewhat

unreasonable to require a small vessel running in uncon-

gested waters to maintain both a pilot and a lookout at all

times. In fact, one court in a case involving a tugboat

stated the rule requiring a separate lookout was limited to

B-25

large vessels. In other instances, a court should weigh

“the size of the vessel and the opportunity of the navi-

gator to have a full view of the sea.” Anthony v. Interna-

tional Paper Co., 289 F.2d 574, 580 (4th Cir, 1961). It is

unclear whether the law of this Cireuit requires a tug to

have a lookout at all times or only when conditions of

navigation require it. Poling Russell, Inc. v. United States,

196 F.2d 939 (2d Cir, 1952).

[4] Assuming, arguendo, that the law of this Cireuit

requires the posting of a separate lookout on a tug at all

times, a violation would then be established and the Penn-

sylvania rule, 86 U.S. 125, 19 Wall. 125, 22 L.Ed. 148

(1874) would come into play with the effect that the owner

must prove that the violation could not have contributed

to the casualty in any way. See Ira S. Bushey & Sons v.

United States, 172 F.2d 447 (2d Cir. 1949). This is not,

however, an unbearable burden. Dwyer Ow Transport Co.

v. The Edna M. Matton, supra at 382; National Bulk Car-

rier vy. United States, 183 F.2d 405 (2d Cir.), cert. denied,

840 U.S. 865, 71 S.Ct. 89, 95 L.Ed. 681 (1950).

[5] There was no proof whatever that a lookout for-

ward could have observed the ice stranded buoy. The

buoy, according to the evidence, was not visible until freed

from the ice by the wake of the passing tug. Indeed, as

indicated earlier, had the deckhand been in the wheelhouse,

he would have been more useful taking the wheel and

freeing Reimer to either take navigational fixes or call

Kiernan, the experienced pilot. Therefore, the failure to

post a lookout cannot be said to have contributed to the

collision.

[6] Finally, we have the question concerning the plain-

tiff’s responsibility for the alleged confusion as to who

was to be the Captain of the vessel. Kiernan testified that

had he known he was the Captain, he would have assured

B-26

himself that Reimer was familiar with the river before

allowing him to take the wheel under the conditions.

Again, errors in management aboard the vessel may not

be imputed to the owners so as to deny limitation. South

Carolina Highway Dep’t v. Jacksonville Shipyards, Inc.,

1976 A.M.C. 456 (S.D.Ga. 1975); see also New York Mar-

ine No. 10, (The C. I’. Coughlin), 109 F.2d 564, 565 (2d

Cir, 1940); Petition of Tracy, 194 F.2d 362, 363 (2d Cir.

1952).

[7] It is argued that the failure to make the chain of

command apparent prior to departure was an error by the

managing officers of the corporation and, consequently,

within the owner’s privity and knowledge. Craig v. Con-

tinental Ins. Co., 141 U.S. 638, 12 S.Ct. 97, 35 L.Ed. 886

(1891). But without regard to whether he acted in the

capacity of Captain or Mate, Reimer was well aware that

he was unprepared to navigate under the diffieult conditions

which were rapidly developing. Kiernan was quite empha-

tie that he was willing to render assistance to Reimer

whether he was Captain or Mate. Therefore, it was Reimer’s

failure to seek assistance, more than Kiernan’s failure to

offer it, that caused the accident. Reimer’s failure in this

regard is similar to the neglect of an otherwise competent

officer to consult available charts and aids to navigation

—an event which is not an unseaworthy condition for which

the owner is responsible. California and Hawaiian Sugar

Co. v. Columbia 8. S. Co., 391 F.Supp. 894 (E.D. La. 1972),

aff'd, 510 F.2d 542 (5th Cir. 1975). Plaintiffs are, there-

fore, entitled to limit their liability.

Governmental Responsibility for the Grounding

We turn now to the plaintiff's contention that the Gov-

ernment’s negligence in maintaining the aids to navigation

in the area of the grounding was a factor in the grounding

= a

B-27

and, therefore, the Government should be found liable for

negligence under the Suits in Admiralty Act, 46 U.S.C.

§§ 741-52.

In Indian Towing Co. v. United States, 350 U.S. 61, 76

S.Ct. 122, 100 L.Ed. 48 (1955), the Supreme Court recog-

nized that liability under the Federal Tort Claims Act ex-

tended to the Coast Guard’s failure to adequately maintain

a lighthouse. Contrasting nonfeasance and misfeasance,

the Court held that, while the Coast Guard had no obliga-

tion to supply lighthouse services, once it exercised its dis-

cretion by electing to do so, it must use due care. Conse-

quently, the Coast Guard was under a duty to maintain the

equipment and to warn mariners in the event the lighthouse

became inoperative.

Indian Towing was applied to the placement and mainte-

nance of buoys by this court in Afran Transport Co. v.

United States, 309 F.Supp. 650 (S.D.N.Y. 1969), aff'd, 435

F.2d 213 (2d Cir. 1970), cert. denied, 404 U.S, 872, 92 S.Ct.

72, 30 L.Ed.2d 116 (1971). In that case, damages were

sought following the grounding of an oil tanker on a reef

caused by a marker buoy having drifted out of position.

Again, while the decision to erect a navigational aid lay

within the Coast Guard’s discretion, having acted, the Coast

Guard was required to act with due care.

[8] Thus Indian Towing imposes a dual responsibility

upon the Coast Guard, once it has decided to locate an aid

to navigatton in a waterway. First, the Coast Guard must

use due care to see that the aid is properly maintained and

operated. Secondly, should an aid become inoperative the

Coast Guard has an additional duty to warn mariners of

the absence of the expected aid. Merely warning mariners

of a perilous condition, as a rule, will not absolve the Coast

Guard of the duty to correct a dangerous condition, but

adequate warnings may absolve them from a partic: lar lia-

B-28

bility. Compare Greer v. United States, 505 F.2d 90 (5th

Cir. 1974) with De Bardeleben Marine Corp. v. United

States, 451 F.2d 140 (5th Cir. 1971).

[9] In the instant case, the Coast Guard was confronted

with submerged rocks at the periphery of the Hudson River

channel relatively close to another aid to navigation (Con

Hook Light). This area had a good safety record during

most of the year while the lighted aid was in use. At the

time of the Ocean Prince grounding, the buoy was in posi-

tion, although obscured by ice. Applying Indian Towing

to these facts, the Coast Guard had the duty to maintain

the buoy or to warn of any interruption of service. The

evidence demonstrates that the Coast Guard, in the Coast

Pilot, warned mariners of the possibility of ice obstruet-

ing buoys in this particular span of waterway and, addi-

tionally, the “Notice to Mariners” for the week of the acci-

dent made particular mention of the problem of ice covered

buoys in that area. Absent a showing that the Coast Guard

had notice of ice covering this particular buoy during the

day in question (and could have repaired it), the Court is

not persuaded that the Coast Guard was negligent in its

servicing of the buoy.

The Coast Guard had determined (and the evidence sup-

ported its conclusion) that during the winter months a can

buoy was the most effective floating aid to navigation avail-

able. The large, lighted buoy not only was more vulnerable

to flow ice, but was also subject to the added danger that

the light would be broken, thereby extinguishing the ex-

pected aid. The plaintiff does not strenuously challenge

this but argues, instead, that the problems of maintaining

the buoy ice free and the dangers of the location, warranted

the installation of different forms of aids to navigation,

either constructed on man-made islands or shore-based

range lights.

In considering the dangers of the location, some evidence

was admitted concerning accidents at the site during the

prior thirty years, as well as two groundings (one of which

resulted in a severe ecological disaster) occurring in the

following couple of years.

[10, 11] Courts have generally recognized that evidence

of a prior similar accident has some tendency to establish a

dangerous or defective condition at the place in question.

Hayes v. Lane Construction Corp., 260 F.2d 279 (2d Cir.

1958) (applying New York law); Balchunas y. Palmer, 151

F.2d 842 (2d Cir. 1945) (applying Conn. law). Such evi-

dence draws its relevance from the principle that similar

causes can be expected to produce similar effects, so that

admissibility hinges upon a demonstration that the condi-

tions had been substantially similar on all oceasions. Hayes,

supra; Balchunas, supra; Knight v. Baltimore & Ohio RR.

Co., 8 F.R.D, 261 (S.D.N.Y. 1948).

Judge Weinstein, in his treatise on evidence, does not

distinguish between prior and subsequent accidents, but

states generally that

“Te]vidence of other accidents in the same place

or involving the same machinery or instrumentality

is generally admissible, not because it shows that

defendant has a general tendency to be negligent, but

because it tends to prove either (1) the existence of

a dangerous or defective condition where this is in

issue or (2) that defendant knew or should have

known of the dangerous or defective condition.

“The requisite similarity of accidents depends on

what the evidence is designed to prove:

‘If the proof of other accidents is offered to es-

tablish the dangerous condition, logie would require

similarity of hazard. But if offered to prove notice

B-30

of danger, the requisite is the warning quality of the

other accident. Thus evidence of a previous acci-

dent at the place, unknown to the owner defendant,

would be irrelevant to prove notice of the danger,

but it may be relevant to prove the dangerous condi-

tion of the place. Likewise, evidence that is unnec-

essary to prove dangerous condition may be logically

relevant to prove the notice of the hazard. Of course

as the circumstances of other accidents are more

similar to the one in question, the probative value of

such evidence for either or both purposes is likely

to be greater.’” 2 J. Weinstein & M. Berger, Wein-

stein’s Evidence § 404[11] at 404-76 (1976), citing,

Trautman, “Logical or Legal Relevaney—A Conflict

in Theory,” 5 Vand.L.Rev. 385, 402 (1952).

While the subsequent disasters have emphasized the

navigational hazard in this area, we must evaluate the rea-

sonableness of the Coast Guard’s decisions on the basis

of facts available at the time of the grounding. Prior

thereto, and over a period of thirty or so years, despite

an extremely heavy volume of traffic, there had only been

two groundings under similar circumstances. (One of them,

to the mortification of the Coast Guard, involved the Cut-

ter Sauk in 1963. Another cutter, in completely dissimilar

circumstances, ran aground in 1969—causing the reef to

be known locally as “Coast Guard Rock”.)

Although, at the time of the aecident the location was

not considered to have a high priority among Hudson

River sites needing additional aids to navigation, some

consideration was given to the situation by the Coast

Guard’s officials. Evidence as to the cost and feasibility

of aids to navigation other than a buoy at this location

persuades the Court that the Coast Guard used due care

in its cision to mark the reef in the winter of 1974 with

B-31

a black can buoy. The Coast Guard weighed the need for

some other aid to navigation against the costs of various

fixed lights, constructions on the pinnacle or its demoli-

tion. It also considered the ecological problems in estab-

lishing shore based aids, the priority needs of other, more

dangerous, locations and the funds available.

In the absence of showing that a can buoy was so in-

effective that its choice constituted negligence per se, the

Coast Guard should not be divested of its executive dis-

cretion to choose such aids to navigation ag will most ef-

fectively and efficiently function within its fixed budgetary

limitations. In so concluding, it must be stressed that this

evaluation is limited to the history of the hazard in 1974,

The Coast Guard’s liability for the subsequent ground-

ings, and the wisdom of erecting different types of aids

to navigation at this time, are issues not before this Court.

[12] There is a further reason for refusing to find the

Coast Guard liable for this accident. Reimer had avail-

able for navigational purposes both radar, which could

take bearings and ranges on prominent objects (such as

Bear Mountain Bridge) and the Con Hook Light, on which

a visual bearing could have been taken. Nevertheless, he

strayed west of the channel looking for an obscured buoy.

The premise that the presence of additional aids might

have assisted in correcting his navigational error would

be a

“fortuity [having] nothing to do with proximate

cause. Liability must rest on causal relationship

between the negligent aspect of the conduct and the

harm resulting from the conduct.”

American Smelting and Refining Co. v. S.S. lrish Spruce,

548 F.2d 56, 60 (2d Cir. 1977).

B-32

It cannot be said, therefore, that the negligence, if any,

of the Government in not establishing more effective aids

to navigation was the proximate cause of the grounding.

The Amount of Plaintiff’s Liability Under

the Water Quality Improvement Act

The Water Quality Improvement Act of 1970, as

amended by the Federal Water Pollution Control Amend-

ments of 1972, was passed by Congress in the wake of two

disastrous oil spills: the running aground of the tanker,

Torrey Canyon, off the coast of Mngland in 1967 and the

Santa Barbara drilling disaster in 1969, The primary pur-

pose of the new legislation was to permit the Government

to collect cleanup costs directly from the polluter. To

effect this goal, the Act provided, in Section 102(f)(1)

of the Water Quality Improvement Act of 1970, later

codified at 33 U.S.C.A. § 1821(f)(1) (Supp. 1977) that:

“Except where an owner or operator can prove that

a discharge was caused solely by (A) an act of

God, (B) an act of war, (C) negligence on the part

of the United States Government, or (D) an act or

omission of a third party without regard to whether

any such act or omission was or was not negligent,

or any combination of the foregoing clauses, such

owner or operator of any vessel from which oil or

a hazardous substance is discharged ... shall...

be liable to the United States Government for the

actual costs incurred ...in an amount not to exceed

$100 per gross ton of such vessel or $14,000,000,

whichever is lesser, except that where the United

States can show that such discharge was the result

of willful negligence or willful misconduet within

the privity and knowledge of the owner, such owner

B-33

or operator shall be liable to the United States Gov-

ernment for the full amount of such costs.” (em-

phasis added).

In other words, the owner or operator of a vessel which

discharges oil can limit its liability, provided the govern-

ment cannot show willful negligence or misconduct.

The legislative history indicates that conflicting policies

resulted in both the limitation amount and the willful neg-

ligence standard for breaking the limitation. The Senate

bill, as introduced, would have imposed liability only if

negligence were shown. The original limitation amount

was the lesser of $450 per gross ton or $15 million. The

$450 amount was based upon the estimated cleanup cost

of one ton of oil. Later evidence indicated that while this

figure reflected an accurate, cleanup estimate, it was im-

probable that any vessel would discharge its entire cargo.

The $100 figure was thereafter substituted to approximate

actual, anticipated costs. S.Rep.No. 91-351 at 4, 91st

Cong., Ist Sess. (1969), 3 E.P.A. Legal Compilation

(Water) at 1327.

[13] While the limitation amount appears to reflect

actual cleanup costs, this goal is not realized where a third

party causes the oil spillage. Section 102(g), 383 U.S.C.A.

§ 1321(g¢) (Supp.1977) controls third party liability and

provides that subject to the same defenses provided in

Section 102(f)(1), a third party which causes an oil spill

will be liable instead of the owner or operator of the spill-

ing vessel. This section also contains a limitation of lia-

bility, and further distinguishes situations where the third

party is the owner or operator of a vessel from other third

party situations. Where the third party is an owner or

operator of a vessel “the liability of such third party...

shall not exceed $100 per gross ton of such vessel or

$14,000,000, whichever is the lesser.” (emphasis added),

B-34

The section goes on to provide that where the third party

causing the spillaye is not an owner or operator of a ves-

sel, its liability “shall not exceed the limitation which

would have been applicable to the owner or operator of

the vessel... from which the discharge actually occurred.”

(emphasis added). Clearly this represents a conscious

legislative choice to inject traditional admiralty concepts

into the limitation calculation by limiting a third party

vessel owner’s liability with reference to his vessel rather

than the vessel which actually spilled the oil. Obviously,

once the limitation is calculated with reference to a vessel

other than that which spilled the oil, the correlation be-

tween vessel gross tonnage and actual cleanup is destroyed.

[14] The legislative history indicates that the drafters,

in providing the third party defense, envisioned a situ-

ation where the third party vessel collides with an oil-

carrying vessel, S.Rep.No. 91-351 at 5, 91st Cong., Ist

Sess. (1969), 3 E.P.A. Legal Compilation (Water) at 1329,

The available legislative materials provide no clue as to

whether the drafters ever considered the situation pre-

sented where a substantially smaller vessel either collides

with or, as presented here, negligently causes the oil spill-

age. It is inconceivable that Congress was unaware that

much of the oil moving on inland waterways is carried by

barges and that the tugs pushing them are often owned

by third parties. Iaced with the clear choice to limit a

third party’s liability with reference to the gross tonnage

of a vessel not spilling the oil, the Court must construe

the section in accordance with the clear import of its

terms, even if the effect would seem contrary to the gen-

eral legislative intent. Where statutory language is clear

and unequivocal, there is no occasion for the Court to

resort to interpretive aids. United States v. Oregon, 366

U.S. 643, 648, 81 S.Ct. 1278, 6 L.ld.2d 575 (1961); Arkan-

sas Valley Industries, Inc. v. Freeman, 415 F.2d 713, 717

(8th Cir. 1969).

B-35

In the face of unequivocal statutory language and the

absence of conflicting legislative history, the Government

nevertheless contends that the “flotilla rule” should apply.

Application of this rule would result in the calculation of

the limitation amount by reference to the combined gross

tonnage of the tug and the barge. While no authority has

been submitted concerning the application of the rule in

the statutory context presented here, it has been applied

in traditional admiralty petitions for exoneration or lim-

itation of liability. The Supreme Court in Sacramento

Nav. Co. v. Salz, 273 U.S. 326, 47 S.Ct. 368, 71 L.Ed. 663

(1927) required surrender not only of a barge but also of

the steamboat towing the barge in an action by the owners

of the barge’s cargo. In a later case, Standard Dredging

Co. v. Kristiansen, 67 F.2d 548, 550 (2d Cir. 1933), the

Second Cireuit interpreted the flotilla rule to permit reeog-

nition of a tug and barge as a single vessel where they are

“owned in common and engaged in a common enterprise.”

Thus, the rule which emerged, as the Government concedes,

is that where there exists a contractual or other obligation

running from the petitioner for limitation to the claimant

and a flotilla of commonly owned vessels was used to fulfill

the obligation, the flotilla is regarded as one vessel for cal-

culating the limitation fund.

[15] The Tug Ocean Prince and the barge were not

owned by the same entity nor is there any vestige of a con-

tractual relationship running between the owners of either

of these two vessels and the Government. Consequently,

the flotilla rule, as traditionally stated, would be inappli-

cable to the facts of this case. The Government, conceding

this much, would have this Court break new ground, and

apply a mutation of the rule to flesh out the terms of the

statute. As the discussion of the language and history of

the statute indicates, the provision limiting the liability of

b-36

third party vessel owners to the value of their vessel is

unambiguous. The Court cannot substitute its notions of

proper legislative goals for those adopted by Congress.

Arkansas Valley Industries, Inc. v. Freeman, supra.

The Amount of the Penalty To be

Assessed Against Pittston —

The penalty provision added by the I"ederal Water Pol-

lution Control Act Amendment of 1972, codified at 33 U.S.C.

§ 1321(b)(6) (Supp. 1977) reads in pertinent part:

“Any owner or operator of any vessel... from which

oil... is discharged ... shall be assessed a civil pen-

alty ... of not more than $5000 for each offense.

No penalty shall be assessed unless the owner or

operator charged shall have been given notice and

opportunity for a hearing on such charge...”

A civil penalty in the amount of $5,000 was assessed

against Pittston after a hearing before a Coast Guard

hearing examiner. Pittston had refused to pay the penalty

on the authority of the federal district court holding in

United States v. LeBeouf Bros. Towing Co., 377 F.Supp.

598 (E.D. La. 1974). The lower court had held that the

penalty provided by 33 U.S.C.A. § 1321(b)(6) (Supp. 1977)

was criminal in nature and could not be imposed except in

a criminal proceeding which afforded adequate protections

for Fifth and Sixth amendment rights. This holding was

thereafter reversed on appeal, 537 F.2d 149 (5th Cir. 1976)

and a petition for certiorari has been denied, 430 U.S. 987,

97 S.Ct. 1688, 52 L.Ed.2d 383 (1977). With the exception

of this single, lower court holding, courts appear to be

unanimous in finding the penalty civil. United States v.

General Motors Corp., 403 F.Supp. 1151 (D.Conn, 1975) ;

B-37

United States v. Eureka Pipeline Co., 401 F.Supp. 934 (N.D.

W.Va. 1975); United States v. Independent Bulk Trans-

port, Inc., 394 F.Supp. 1319 (8.D.N.Y. 1975) ; United States

v. W. B. Enterprises, Inc., 378 F.Supp. 420 (S.D.N.Y. 1974).

The penalty provision at issue holds the owner or opera-

tor of a vessel strictly liable for the penalty, following a

hearing at which normal due process safeguards are ex-

tended. Section 1321(b)(6) provides that “[i]n determin-

ing the amount of the penalty .. . the appropriateness of

such penalty to the size of the business of the owner or

operator charged, the effect on the owner or operator’s

ability to continue in business, and the gravity of the viola-

tion, shall be considered. . . .”

The Coast Guard has stated its interpretation of these

standards in “Coast Guard Policy for the Application of

Civil Penalties Under Section 311(b) (6), FWPCA,” which

was printed as an appendix to the lower court decision in

United States v. LeBeouf Bros. Towing Co., supra, at 569-

70. While the statute does not explicitly include the de-

gree of the actor’s culpability as a factor in assessing the

amount of the fine, the Coast Guard policy statement em-

phasizes that “[a] number of considerations may be made

in determining the gravity of a violation, such as the de-

gree of culpability associated with the violation, the prior

record of the responsible party, and the amount of oil dis-

charged. Substantial intentional discharges should result

in severe penalties, as should cases of gross negligence,

and so on. This is not to suggest that other considera-

tions may not combine to determine the gravity of a viola-

tion.” Id. at 569 (emphasis added).

In this context, it is vaiuable to note that while the 1972

amendments make no reference to culpability as a prerequi-

B-38

site for a substantial fine,? the predecessor of this penalty

did. Section 11(b) of the Water Quality Improvement Act

of 1970, Pub. L.No. 91-224, previously codified at 33 U.S.C.

§ 1161(b) (5), provided for a maximum fine of $10,000 for

“knowing” discharges. The 1966 amendments to the Oil

Pollution Act of 1924 created liability when a discharge

resulted from a “grossly negligent or willful act.” Note,

Liability for Oil Pollution Cleanup and the Water Quality

Improvement Act vf 1970, 55 Cornell L.Rev. 973 (1970).

Thus, while the section does not expressly require cul-

pable behavior, prior legislation and the Coast Guard in-

terpretive standards for implementing the penalty all

make reference to some element of negligent or knowing

conduct prior to the imposition of a substantial penalty.

The Government contends that the maximum fine should

be assessed against Pittston on the sole basis of the

“eravity of the violation,” without any consideration of

the degree of Pittston’s culpability. The Government fur-

ther argues that, while third party causation does not pro-

vide a defense to imposition of

This text is long and has been trimmed here. Open the source document for the complete record.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.