Admiralty Outline by TylerJMerkel

VIEWS: 9 PAGES: 39

									Admiralty Outline – Merkel – Spring 2012
Neal@GP-law.com

Class 1 (1/11 – 41-80)

       Introduction – Overview
             o Reasons behind the importance of Admiralty – encompasses many other areas of practice.

Jurisdiction
       USCONST ART. III SECTION 2 – The judicial Power shall extend … to all Cases of Admiralty and
        maritime Jurisdiction.
       28 USC Section 1333
            o District courts will have original jurisdiction …

Navigability

       Genesee Chief
            o Facts – Cuba suing Genesee Chief for liability for sinking their ship. The owners of the Cuba are
                 suing the boat itself. Their claim is a suit for damages for the loss of the Cuba.
                       Libellants – The plaintiffs. In admiralty in 1851 you did not filed a complaint but a liable.
                       Respondants – (defendants)
                       In rem – The defendant is the ship itself. In Admiralty a ship can be a party, and be the
                           ONLY party to the lawsuit.
            o Procedural History - Trial court says the Cuba wins. On appeal, however, that is affirmed, but not
                 on the Supreme Court because there is a want for jurisdiction.
                       Why? Absent subject matter jurisdiction, there is none. Genesee Chief says that the
                           statute granting Admiralty jurisdiction is not constitutional.
                       The jurisdiction was bound by the ebb and flow of the tide because that is what admiralty
                           jurisdiction was understood to be at the time the Const was adopted.
                                 This comes from England. Why did it take so long? There wasn’t much
                                     development of the Great Lakes until then.
                       Diversity Jurisdiction did not cover this.
                       Why in rem?
                                 1. Speedy
                                 2. Wartime and Prize Cases
                                 3. Safety.
            o RULE – “all civil cases of admiralty and maritime jurisdiction” means all maritime contracts, torts
                 and injuries; torts and injuries depend on locality, and contracts depend on relation to navigation,
                 business, or commerce of the sea. So they can be done on land.
       Lynch v. McFarland
            o Facts – Lady was hurt in a speedboat accident. The defendants argue that the waterway in
                 question does not satisfy the test for navigability and thus must be dismissed.
            o Issue – Whether or not Lake Cumberland was a “navigable water”.
                       If there is then there is Admiralty jurisdiction.
            o DANIEL BALL RULE – A waterway is navigable in fact if it is or is susceptible of being used,
                 in their ordinary condition, as highways for commerce, over which trade and travel are or may be
                 conducted in the customary modes of trade and travel on water.
                       Present navigability in fact!!!


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                        Seasonable Navigability SATISFIES as well! A couple months out of the year is fine.
              o    Held – It is not enough to have a small inconsequential creek going between waterways. There is
                   no commerce and it is not susceptible for it.

Vessels

         Evansville & Bowling Green Packet Co. v. Chero Cola Bottling Co. (1926)
              o Facts – A wharfboat on the water that is permanently affixed to the land.
                         Limitation of Liability Act – even if you’re at fault, you can limit liability to the value of
                             the vessel. (This is generally what it is). This is a HUGE offensive weapon.
              o Issue – Is it a vessel?
              o Held – No.
              o RULE – If not at risk to the perils of the sea, you cannot seek the protection of the Act.
         Keys Jet Ski, Inc. v. Kays
              o Facts – Jet Ski case where the owner of a jet ski tried to file for limitation.
              o Issue – is a Jet Ski a vessel?
              o Held – Yes!
              o RULE – Pleasure crafts, and jet skis are vessels.
         Notes
              o If someone offshore are hurt by the consequences of the act, then Admiralty Jurisdiction
                   applies.

Why Do We Care About Jurisdiction?

         Potential Consequences of Admiralty Jurisdiction
              o 1. Issue of Jury or Federal Judge
                        Under Admiralty law, there is typically no right to a jury trial from either party.
                        The person who is potentially at fault wants the jurisdiction because a Federal Judges is
                           much more conservative typically.
              o 2. LOLA (Limitation of Liability Act)
                        Congress passed in 1951 in which a vessel owner can limit liability, even if negligent, to
                           the value of the boat after casualty.
              o 3. In-Rem Seizures
                        The boat being the defendant. A vessel seizure must be under Admiralty jx.
              o 4. Interlocutory Appeals
                        Typically speaking, to appeal an order you must have a final judgment, meaning the case
                           must be totally closed. If there is reversible error, you have to wait until there is a final
                           order. “Final Judgment Rule”.
                                 YOU CAN APPEAL Interlocutory in an Admiralty Case. (28 USC 1292)
              o 5. Rule 14(c)
                        3rd Party practice of joinder. (Asahi)
                        Under Admiralty Law – The 3rd Party is directly liability. You can tender the liability and
                           avoid you altogether.
                                 True of all Federal Jurisdiction?

Subject Matters
Contracts – The Nature of Certain Maritime Contracts



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       Maritime Contracts
            o 1. K to repair a vessel.
            o 2. K to insure a vessel.
            o 3. Charters.
            o 4. Contracts to “man” or crew a vessel.
            o 5. Bonds covering cargo on a vessel.
       Not Maritime Contracts
            o 1. Contracts to build/construct a vessel.
            o 2. Sale of a vessel.
       DeLovio v. BOIT
            o Facts - slave ship case where insurance K made on land, not made on the sea. Story wanted this to
                 go to the S.Ct., but it didn’t yet.
            o Issue – Whether or not admiralty claims made on land extend to occurrences at sea.
            o Held – Yes.
       Kossick v. United Fruit Co.
            o Facts – Petitioner, while employed as chief steward on one of the vessels of respondent saying he
                 would pay for the damages of whatever improper or inadequate treatment might have been
                 provided. Seafarers = people who spend at least 30% of their time in service of a vessel – they are
                 exempt from worker’s comp benefits.
                       Note – Seafarers have far different rights than us. One of them is called “Maintenance
                          and Cure” – if you get hurt or get sick, the employer has a Contractual Obligation to:
                                1. Get and pay for your medical care; and
                                2. Pay you daily living allowance.
                       Employee wanted Admiralty law because the state law excluded oral contracts as a
                          matter of law.
            o Issue – Whether or not the duty created by contract for maintenance and cure covered the damages
                 under Admiralty or some other remedy?
            o Held – Admiralty law covers the contract between the employer and employee.

Preliminary, Collateral and Mixed Contracts

       Shipping Financial Services Corp. v. Drakos (Preliminary K)
            o Facts – This was a case where Duke Petroleum was going to purchase the vessel after the charter
                was signed 12 years later. There was a boom in prices over 10 years. The seller makes life on the
                charter miserable. The charter, knowing this, decided the thing to do was to sub-charter it then buy
                it pursuant to the original K. In 1994, Shipping Services (P) helped find a sub-charterer for the
                boat. They tried to, the sub charterer expressed disinterest, but then tried to cut the broker out.
                Plaintiff sued under Admiralty jurisdiction, it was dismissed. On appeal, the 2nd circuit said NO, it
                is about the nature of the contract.
            o PRELIMINARY CONTRACT DOCTRINE (Still valid, just not per se) – Doctrine stating that
                services leading up to a maritime contract are not enough to get Admiralty jurisdiction.
                      Didn’t above, we just say that a K to crew a vessel was enough? A contract with someone
                          to procure insurance, is not a maritime insurance.
                      RULE HAS CHANGED – now most of the time, agency contracts are not open per se
                          for Admiralty jurisdiction.
            o Issue – Is the K enforceable under maritime jurisdiction?
            o Held – No.
       Inbesa America v. M/V Angila (Mixed K)


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             o   Facts – P had two legitimate charges that would support the jurisdiction, the 4 that didn’t unless
                 severable would fail.
             o   Issue – When you have a K with some maritime aspects, and some others – do you get maritime
                 contracts? Does the K need be wholly admiralty in nature?
             o   RULE – For a K to be maritime it must be wholly maritime.
                      Exception – if you can sever the terms of the maritime K, but not the other.

Class 2 (1/25 – 81-118)

Torts

       The Plymouth (1866)
            o Facts – Tort action filed by a warehouse owner whose property was destroyed by fire when it was
                caused by a fire on a ship nearby. Warehouse owner sued in admiralty jurisdiction and it was
                contested because to satisfy jurisdiction you must meet the locality test, which called for the
                incident to occur entirely on water.
            o Held – For the respondent because it did not happen entirely on water.
            o OLD RULE – Locality – must happen entirely on the water.
       The Admiral Peoples (1935)
            o Facts – Petitioner was injured while disembarking from the plank to the dock.
            o Issue – does Admiralty of State law apply?
            o Held – Jurisdiction in cases of tort depends upon locality of injury. It does not extend to injuries
                caused by a vessel to persons or property on the land.
                      The CAUSE of injury AROSE on the vessel, thus admiralty jurisdiction applies.
            o OLD RULE – Where the cause of action arises upon land, the state law is applicable.
                      Where the wrong occurred, not where the consequences were felt on land.
            o Analysis – The gangplank was part of the vessel’s equipment that was placed in position to enable
                disembarking. While on the gangplank, she had not yet left the vessel. Still true if she proceeded
                to the shore end. Instead of being injured ON the plank through, for example, a negligent ship shift
                while disembarking, it would be an admiralty case.
       Gutierrez v. Waterman S.S. Co. (1963)
            o Facts – Petitioner is a longshoreman unloading the S.S. Hastings in Puerto Rico who slipped on
                some loose beans spilled on the dock and suffered injuries as a result.
            o Issue – Is there admiralty jurisdiction on a loading dock?
            o Held – Yes.
            o RULE – The Extension of Admiralty Jurisdiction Act 46 USC 740 – extends liability insofar as
                vessels on navigable water liable for injury or damages “notwithstanding that such a damage or
                injury be done or consummated on land.” (Re codified 46 USC 30001)
                      So Admiralty and Maritime Jurisdiction Extends to –
                               Cases of injury or damage,
                               To persons or property,
                               Caused by a vessel
                               On navigable waters,
                               EVEN THOUGH the injury or damages is consummated on land.
                                       o Admiral Peoples would be slam dunk for jurisdiction here.
            o Analysis – Liability should extend when the ship owner commits a tort while or before the
                unloading of a ship and the impact of which is felt ashore at a time and place not remote from the
                wrongful act.
       3 Prior Rulings on Admiralty Jurisdiction by SCOTUS (4 opinions in 25 years)

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        o   1. 1972 – Executive Jet – Plane is taking off to NY and halfway up the runway the plane hits a
            flock and the plane goes down 1/5 mile away from the shore. Plaintiffs sue under admiralty
            jurisdiction because the tort happened over navigable waters. 6 th circuit says it happened on land.
                  HELD – does not meet the locality test because it was not “traditional maritime activity”
                      when a plane crashes. (They made it an exception). They said it actually passed the test
                      though.
        o 2. 1982 – Formos v. Richardson – Two pleasure boats having nothing to do with interstate
            commerce collide. Does a collision between two pleasure craft satisfy jurisdiction?
                  HELD – Yes, the locality/Executive test because although there was not a “commercial
                      maritime” flavor, it COULD HAVE disrupted traditional commercial activity on
                      navigable waterways.
        o 3. 1990 – Sisson – Marina with a serious fire starting at a vessel. Burns the vessel, part of the
            marina, the dock and other vessels due to a washer dryer combo aboard the pleasure craft on the
            marina. Does this satisfy the test?
                  HELD – Yes. It COULD HAVE disrupted traditional maritime activity.
   Jerome B. Grubart, Inc. v. Great Lakes Dredge & Dock Co. (4th SCOTUS decision on Jurisdiction)
        o Facts - After the Chicago River flooded a freight tunnel under the river and the basements of
            numerous buildings, petitioner corporation and other victims brought tort actions in state court
            against respondent Great Lakes Dredge & Dock Co. and petitioner Chicago. They claimed that in
            the course of driving piles from a barge into the river bed months earlier, Great Lakes had
            negligently weakened the tunnel, which had been improperly maintained by the city.
        o Procedural History – The District Court held that there was no Admiralty Jurisdiction, overturned
            by the Appellate Court.
        o Held – There is Admiralty Jurisdiction here.
        o RULE – To have TORT JURISDICTION IN ADMIRALTY LAW, you must satisfy
                  1. Location – Whether the tort happened on:
                           A. navigable waters, OR
                           B. the injury suffered on land was caused by a vessel on navigable waters
                           AND
                  2. Connection with Maritime Activity
                           A. General features of the type of incident involved to determine if the incident
                               has "a potentially disruptive impact on maritime commerce." AND, IF SO
                           B. Whether the character of the activity giving rise to the incident shows a
                               substantial relationship to traditional maritime activity.
        o Notes
                  What happens to the co-defendants in situations like this?
                           ONLY ONE DEFENDANT NEED MEET THE TEST TO ASSERT
                               JURISDICTION.
                           That said, the co-defendants are stuck.
                           So here, the other defendant gets screwed under joint and several liability if they
                               are found at fault at all.
   H2O Houseboat Vacations Inc. v. Hernandez (1996)
        o Facts – Plaintiffs were injured by carbon monoxide fumes in a houseboat they rented from the
            appellant and asserted admiralty jurisdiction.
        o Procedural Posture – District court dismissed for lack of subject matter jurisdiction under Rule
            12(b)(1) of FRCP because it did not have the potential to disrupt maritime commerce.
        o HELD – 9th Circuit says there is no admiralty jurisdiction because there is no potential to
            disrupt.(2A issue).

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          o    Notes
                     How is this different than Sisson? The fire in that case spreads, the boats near a carbon
                      monoxide leak does not present a risk to others.
     McClenahan v. Paradise Cruises, LTD. (1995)
         o Facts – Hawaii – plaintiffs injured their ears on a cruise while scuba diving. Sues on admiralty.
             Defendants dispute that a scuba diving injury is not potentially disruptive and even if it is, does
             not bear a substantial relationship to maritime activity.
         o HELD – 2(a) is plainly satisfying because it can be potentially disruptive to maritime commerce;
             and 2(b) is satisfied because it is a traditional maritime activity.

Admiralty Jurisdiction and Federalism
     Generally
           o 28 USC 1333
                    District courts shall have original jurisdiction exclusive of the courts of the states of
                              (1) Any civil case of Admiralty or Maritime JX,
                              Saving to suitors in all cases all other remedies to which they are otherwise
                                  entitled.
                                       o “Savings Clause”
                                       o (Except where the common law where the states are competent and
                                            capable of giving a remedy)
           o This statute is still debated. It “saves” to suitors (plaintiffs) the right to go into state civil court so
               long as they had a common law remedy in state court.
     Filing Options for a Plaintiff with an admiralty claim:
           o 1. File in Federal court under 28 USC 1333 – no jury trial.
           o 2. File in State court through the Savings Clause if your remedy existed at common law.
                    Example: Negligence.
           o 3. File in Federal court under Diversity Jurisdiction – 28 USC 1332 if diversity is satisfied.
     The Hine
           o Is jurisdiction exclusive? No, so long as the remedy was saved by the Savings Clause.
     CJ Hendry Co. v. Moore
           o Facts – CA seizes a purse net in violation of state law. Defense was that it could not be brought in
               CA because it was not saved by the Savings Clause. This is the state taking Maritime property in
               rem. Generally, this action does not satisfy that clause because the remedy of seizure is not
               accepted by common law.
           o HELD – the state could proceed with this because it was very unique. GENERALLY in rem is not
               saved by the savings clause. (Want to seize a ship cannot do it in state, must be FED)
                    ASK ABOUT THIS – replevin?
     Pino v. Protection Maritime Insurance Co.
           o Another departure from the traditional rule.
           o Can courts give injunctive relief in Admiralty Court?
                    YES.
     In Re Chimenti (1996)
           o RULE – Admiralty cases in state court, CANNOT BE REMOVED TO FEDERAL COURT ON
               ADMIRALTY GROUNDS ALONE.
                    You would need an independent basis for jurisdiction such as diversity.
                    One noticeable exception – Jones Act claims are never removable once in state court
                        even with diversity.

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Sources of Substantive Maritime Law
The General Maritime Law and Federal Preemption

      Sources of Law
           o 1) Federal Statutes
                      Jones Act,
                      Longshore Act
                      Death on the High Seas Act – 3 nautical miles out regardless of status, you have a claim.
           o 2) Judge-Made – “General Maritime Law”
                      Jus gentium – the maritime traditions of all the nations of the sea.
                      General maritime law comes from maritime traditional laws sometimes 1000’s of years
                         old which is common practice among many nations
           o 3) International Agreement
           o 4) State Law
      R.M.S. Titanic, Inc. v. Haver
           o Issue – what rule of law governs?
           o Facts – It was built in Ireland, and this was its maiden voyage from Europe  NYC. It sinks about
                400 miles east of Canada. Exclusive rights for salvage were granted to Titanic Inc. and they filed
                an injunction against anyone who might want to try to also claim it. They wanted to be legally
                protected against later comers.
           o RULE – When there is an international issue, general rule of the sea would apply. The hope is that
                other courts respect the order. We cannot guarantee enforcement, but that is the only way this can
                work.
      Norfolk Shipbuilding & Drydock Corporation v. Garris
           o Issue – whether the negligent breach of a general maritime duty of care is actionable when it
                causes death, as it is when it causes injury.
           o Facts – P injured while sandblasting a ship in state navigable waters. The plaintiff is the mother of
                the worker because he died after he fell. She claims admiralty jurisdiction. The District Court
                dismissed it because the death of a non-seaman on state territorial waters because “no cause of
                action exists, under general maritime law, for death of a non-seaman in state territorial waters
                resulting from negligence.”
                      Duties of Care
                                1) Seaworthiness
                                        o Unseaworthiness
                                2) Reasonable Care
                                        o Negligence
           o Held – Yes. "The general maritime law has recognized the tort of negligence for more than a
                century, and it has been clear since Moragne v. States Marine Lines Inc. that breaches of a
                maritime duty are actionable when they cause death, as when they cause injury,"
           o RULE – Under general maritime law, death or injury from reasonable care breaches can be
                brought under admiralty law like existed for duty of seaworthiness.
           o Notes
                      Why did it take so long to get to this point? Because generally wrongful death issues
                         were state ruled.
                      What you will find is that Duty of Seaworthiness is Strict Liability
                      Duty of Reasonable Care is a Fault Based system.



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                        Judge creating maritime law. Unique solution in Garris as this was not a legislative
                         creation.

Uniformity, “Reverse Erie,” Jensen, Preemption

       Preemption
            o 1. Express Preemption – “any contrary state law is invalid.”
                      FLSA – Does not permit a minimum wage below $X.XX.
                      Congress says it outright.
            o 2. Implied Preemption
                      A. Field Preemption
                               Atomic energy, for example.
                               Congress has exhaustively passed so many laws by this that states have no room
                                   to regulate.
                      B. Conflict Preemption
                               There is a conflict, so Federal takes the cake.
            o 3. Dormant Admiralty Clause/Maritime Preemption
                      Can a state law be preempted on uniformity grounds where there is no express
                         Congressional enactment at all, but the only Federal Law is judge-made maritime law?
                         Sometimes.
       Southern Pacific Co. v. Jensen
            o Facts – The widow brought action because the husband was driving a truck with lumber and it was
                stuck. His job was to go from the land to the ship in a utility vehicle and unload the steamship.
                The vehicle was stuck and the petitioner hits himself in the head reversing it. He left behind a
                widow and two children. The company objected to the award in state law because they said there
                is maritime jurisdiction and thus the award was incorrect in applying NY worker’s comp laws to
                it.
            o Issue – Whether or not state law can rule the day in admiralty law.
            o RULE – The Jensen Test – STATE STATUTES INVALID IF:
                      1. They contravene the essential purpose expressed by an act of congress; or
                      2. It works material prejudice to the characteristic (ie unique) features of the general
                         maritime law; or
                      3. If it interferes proper harmony and uniformity of general maritime law in either
                         international relations or interstate relations.
            o Held – This law is inapplicable.
            o Notes
                      After this, Congress passed a law trying to say that state’s laws would apply to wrongful
                         death suits.
                      SCOTUS ruled in Knickerbocker that not even Congress can delegate this and it is
                         unconstitutional.
       American Dredging Co. v. Miller
            o Facts – Miller is a worker and Defendant is his employer which is the only correct defendant
                under the Jones Act. He gets medical care in Penn, returns to Miss and gets care there, then gets a
                lawyer to file a Jones Act claim in Louisiana. There is no connection between the employer or
                employee in Louisiana. Orleans Parish has a very employee friendly court. Defendant filed a
                motion of forum non conveniens. The trial court agree and dismissed based upon this. State court
                of Appeals affirmed, Supreme Court of LA reverses based on a STATE STATUTE which says
                that “Jones Act cases are not open to forum non conveniens and this is not preempted by Federal


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                 statute.” Plaintiff argues that Defendant’s action is dead in the water, Supreme Court of Louisiana
                 agrees.
             o   Issue – Whether in admiralty cases filed in a state court under the Jones Act and “saving to suitors
                 clause,” federal law pre-empts state law regarding the doctrine of forum non conveniens.
             o   Held – SCOTUS finds that the Jensen Test is satisfied, thus the statute stands.
                       1. No issue here.
                       2. Material prejudice against characteristics of maritime law? Big issue
                                 Important issue is for ship owners not to be dragged into inconvenient courts.
                                          o Scalia rejects this notion on the word characteristic (being exclusive to
                                               Maritime JX) which he asserts means has to be unique to admiralty and
                                               the forum non conveiniens is not characteristic generally.
                                          o Dissent says that it only matters if it is important not unique.
                       3. Interferes with the proper harmony and uniformity of the GML in International and
                           Interstate relations.
             o   Notes
                       Recap: Erie Doctrine
                                 When a federal Court sitting in diversity JX resolves issues of substantive state
                                     law it must apply the law of the state’s highest court.
                       Reverse Erie Doctrine
                                 When a state court resolves issues of substantive Maritime Law, it must apply
                                     the law as set forth by SCOTUS.
                       “Substantive is important”
                                 Procedural rules in Federal Court will still govern, but only must look to the
                                     state for substantive issues under Erie, converse for Reverse Erie Doctrine.
                       The purpose of this statute is forum shopping, there is really no doubt about that.
      Aubrey
           o All this happened pretty much in CA. Cali port, employees, business – mostly in CA waters. They
               wanted the benefits of CA’s wage/hour laws because it was more beneficial to them. Employer
               argued that under the FLSA, Congress could not delegate this to the states. They were running into
               the same problems which were run into during Jensen. District Court agreed, but the 9th Circuit
               reversed and said that California’s laws were legitimate.
           o Not enough maritime flavor to worry about #3 in the Jensen test.
      Milstead v. Diamond M Offshore, Inc.
           o Facts – P asked for a bench trial and D was held liable under state law where courts have applied
               the Federal law under Reverse Erie. In LA, appellate courts can look over everything de novo and
               give no deference to the fact finding of the lower courts.
           o Issue – Whether an admiralty case tried in state court should be reviewed under state or federal
               standards of appellate review has received much attention from Louisiana’s courts of appeal in
               recent years. Basically can LA’s standard of review work as a procedural issue or substantive?
           o Held – The standard of appellate review even when it is de novo it is procedural, not substantive.
               Thus LA is free to apply their own review and does not violate Jensen test.
                     Reverse Erie situation – standard of review on a state level case is procedural, not
                        substantive and thus LA does not violate Jensen on de novo review.

Practice and Procedure
Mechanisms

In Personam Process

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   Rule B
        o People cannot get attorneys fees from you
        o Maritime Attachment [Rule B] – Writ of Maritime Attachment
                (1) Plaintiff has an in personam claim against Defendant in Admiralty JX;
                (2) Defendant cannot be found within the district where the action is commenced;
                (3) Property belonging to Defendant is present or will soon be present within the District;
                    and
                (4) No statutory or general maritime law prohibition.
        o You need all these to use Rule B
        o Reasoning
                Acquiring JX
                Seizing to enforce judgment on a claim
   Rule C
        o Seizure for a (a) vessel or (b) cargo.
        o The THING itself is the defendant.
        o Exclusive to the Federal Court – if you want to seize a vessel you will have to do it in Federal
           Court.
        o Making property a “person” = makes it legitimate to sue. The US in a global view, we are the
           minority that holds on to the personification view.
        o Plaintiff does not need to post bond of any kind.
        o Requirements:
                Maritime lien against the thing being seized (vessel, chattel, etc.)
                          Maritime lien – A privileged claim upon Maritime Property arising out of
                             services rendered to or injuries caused by that property.
                                  o A rough security device to keep vessels moving in commerce and
                                       prevent them from escaping legitimate debts by sailing away.
                          Types of Maritime Liens:
                                  o Unpaid wages of crew
                                  o Salvage – aid or rescue provided to a vessel; save a sinking ship – do
                                       have a duty to help, but if you are successful in saving valuable things
                                       such as cargo/property – you get a % of what you have saved.
                                  o General Average – if you jettison 10% of the cargo to save the rest of
                                       the 90%, whoever owned the other 10% of stuff has a maritime lien
                                       against the vessel to force the vessel owner and the other cargo owners
                                       to seize it and get a significant portion of the cargo you lost.
                                  o Breach of charter – (Not true under English Law which is helpful to the
                                       ship owner)
                                  o Preferred Ships Mortgages – Banks usually own the ships, but unlike a
                                       mortgage which you file with the recorder of deeds office, you register
                                       with the US Coast Guard which allows you to seize.
                                             Think Art. 9 proper filing.
                                  o Necessities – repairs, towage, supplies … 46 USC 31342
                                  o Maritime Tort – think about a collision. If two boats collide the two
                                       owners can seize each other’s boats. Gives rise to a maritime lien.
                                  o Pollution
                          Do NOT give rise to liens:
                                  o (1) Jones Act Claims
                                  o (2) Longshore Act Claims


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                    You do not need to file anything with the Coast Guard, but you can. Under State
                     Law you don’t have it until it is filed.
o   Problems with liens that do not have to be recorded:
         Maritime liens are not extinguished to good faith bona fide purchasers.
                  Put an indemnification and a 3rd party surety. Not easy to get, but great
                     protection.
                  Checking the Coast Guard filings is one way; many people do it even when it
                     isn’t required.
                  Ask for verification that the vessel and its owner have had insurance so you have
                     insurance company to go after if there is a claim. If the buyer is thinking about
                     buying a vessel and the seller cannot show it was insured, it is a pretty good sign
                     you are going to run a yellow light and should be cautious. If they are insured
                     and then it is seized then you post bond, then you file suit against the buyer
                     where you knew he was insured.
         When do these arise?
                  Bankruptcy – companies actually do not own them, the bank that mortgages
                     them do. What you are permitted to do under the bankruptcy code you can
                     accept/reject all contracts going into the future. Banks know shit about boats
                     except that they get money from Charters. So if companies filed for Chapter 11,
                     they would say “hey banks, we are just going to reject all contracts under
                     bankruptcy code – you can just have all these contracts – have fun.” Banks are
                     forced to reduce charter pay to get around the bankruptcy.
                          o Automatic Stay – when someone files for bankruptcy, all claims are
                                stayed and everyone with a claim must come into one bankruptcy court
                                and the court will decide how much you are going to get paid for your
                                claim.
         Using Rule C in Real Life.
                  Example: $3M ship that hit the dock, did $2M damage. The company that did it
                     filed for bankruptcy, they force everyone to do it. At the same time they are
                     rejecting charters with the bank that actually own the vessel saying we don’t
                     care for them anymore. What can you do under Rule C?
                          o When they reject the contract, they are no longer the owner and it can
                                be seized under Rule C. You don’t have a bankruptcy code issue
                                because the bank is the sole owner now because the company has
                                discharged their property rights.
                          o The bank would wake up and pay almost immediately to the Plaintiffs
                                because they have no defenses. If you represent someone that is
                                perusing a claim against someone with bankruptcy.
                  Example: If someone who rarely comes to a district damages something and
                     leaves, what do you do since they don’t come back. You file a Rule C while they
                     are still there, then they have to post a bond to get it back. Then you don’t have
                     to worry about it later. You can get it seized the next day if you want to.
                  Example: Repairs – if you represent one, make sure the Repair Yard has been
                     paid before they leave, if they don’t – file the Rule C seizure to make them get
                     bond, then let them go.
o   Order of Lien Payment
         Opposite of UCC pretty much – Inverse Order Rule
         Order of payment on maritime liens are as followed:


                                                                                                     11
                                   [Within a class, liens later in time prime earlier ones]
                                   1. Expenses of justice while vessel under arrest (seizure of vessel, pay the
                                    custodian first)
                               2. Wages of seamen & maintenance and cure
                               3. Salvage and General Average
                               4. Maritime Torts
                               5. Contract Liens (like breach of a charter).
                     Generally sale of a vessel to a GF bona fide purchaser is not enough, unless it is a judicial
                         sale all liens are extinguished at the sale.
                     Exception to the Maritime Order of Payment
                                    A preferred ship’s mortgage has priority EXCEPT on liens prior to when the
                                    mortgage was created.
      World Tanker Carriers Corp. v. M/V Ya Mawlaya
          o Facts – Collision between 2 vessels in international waters, 8 deaths, damage. The defendant
               argues that there is no jurisdiction because there was not sufficient contacts with Louisiana (where
               it was loaded). The DC granted the motion to dismiss b/c Federal Rule 4K2 and the Long Arm
               statute did not give jurisdiction.
                     4K2 refers to the idea that under Federal Rule you can get around the idea that a
                         shipowner has to have “sufficient minimal contracts with a state” to sue them.
                               Applies to the nation not the state with “minimum sufficient contacts”.
          o Issue – Rule 4K2 talks about claims needing to arise out of Federal Law.
          o Held – Even though Admiralty isn’t satisfied, it is a “claim arising under Federal Law”
          o Rule – “Sufficient Minimum Contacts” can be added up from things around the nation. It isn’t
               1331, it is Rule 4k2.
      Egan Marine Contracting Co. v. South Sea Shipping Corp.
          o Facts – MD has a statute saying corporations that are foreign must have a registered agent. South
               Sea is a Charter and they appoint Hanson and Tidewater to be their registered agent – meaning
               they deal with all decisions. They hire Clark to do the loading. Clark calls Egan to do “lashing
               services” which is the wiring to hold barges in a tight configuration. They are not paid, Egan did
               not get paid, Clark is called and tells Egan, Clark says deal with Hanson  South Sea. They are
               surprised, naturally because they haven’t heard of Egan or Clark.
          o Issue – Was there enough contacts?
          o Held - Since the defendant’s presence was substantial, even though it was attenuated to the 4 th
               level it didn’t matter because their presence was substantial.
          o Rule – Jurisdiction is satisfied even when a registered agent hires another and that person is not
               paid.

In Rem Arrests

      USL Capital v. New York 30
          o Facts – NY 30 is an actual vessel, so it is in rem and in Federal Court. It was sold in judicial sale
              in 1995. The plaintiff, US Capital is a corporation that got into loaning money and sued to
              foreclose a first preferred first mortgage. P filed suit in 1995, the next month Simpson intervened
              on a lien from Towage services from 1987-1988 – 7 years ago. Turns out that Simpson had
              previously been sued and counterclaimed because they were never paid and got a judgment on the
              counter claim for $122k. These are “necessary” liens.
                    Simpson argued the lien arouse before the first mortgage, and thus the towing services
                        from 1987-88 will be paid first in priority.


                                                                                                                12
                         The Bank argues that there is already an in personam judgment against the old
                          shipowners and argues thus they cannot get a second shot and take the ship.
            o Analysis – 3 Factor Test to see if the in personam claim bars the in rem claim:
                      1) sufficiently same parties;
                      2) final judgment;
                      3) sufficient similarity between the cause of action and damages.
            o Issue – Should the law allow successive claims and allow in personam and later in rem?
            o Held – The in personam suit is not barred, but the judgment from earlier is the cap of the damages.
                So they get the $122k. (Majority Rule)
            o Rule – a second in personam judgment against an in rem claim is fine, but only to collect on what
                was not paid from the previous judgment.
       United States v. Freights, Etc. of the Mount Shasta
            o Facts – The defendant is not the ship, or even cargo – it is the FREIGHT. They are in rem suing a
                debt. They are suing an intangible. This is a libel in rem against freights. The plaintiff did a
                “bareboat charter” of the Mount Shasta. The Charter stipulated that the USA would have a lien
                against all cargos and sub-freights of the vessel. Any money earned, they can get at (standard
                provision). Bare-boat makes a sub-charter and the US is owed more than $200k on the movement
                of the vessel under the charter.
                      Types of Charters:
                                Full – crew is provided.
                                Bare boat – you have to crew/operate it.
            o Issue – Can you sue a debt in rem – have jurisdiction.
            o Held – Yes.
            o Rule – SCOTUS – It is okay to sue in rem on freights. You do not need to have a tangible race.
            o Dissent – Justice McReynolds – 4 Paragraphs and basically says he is confused how you can seize
                the un-seizable.
                      Note – this has never been overturned and only cited very sparsely.

Quasi-In-Rem Attachments

       Heimar, Inc. v. Anomina Ravennate Di Armamento Sp.A. Ravenna
            o Facts – (Concerning Rule B and Rule C) Heimar had chartered Pegasus Erie, they complained it
                was not fit to carry oil. Sued in personam. Heimar got the ship arrested. Pegasus claimed that
                under English Law (agreed to in their Charter) does not give rise to seizure. Magistrate denied.
                Owner provided the bond to get the release. Defendants gave motion to dismiss because there is
                no attachment with Rule C. DC agrees, but on their own converts the seizure to a Rule B
                attachment so long as the defendant cannot be found in the district. District Court said that it was
                not satisfied because D could be found. 5th District vacates.
            o Issue – Is the defendant found within the district at the time there was a seizure or the time of
                complaint?
            o Held – Defendant filed 15 minutes too late and the attachment is invalid. Even though there was a
                wrongful Rule C seizure, it can be converted into a Rule B issue.
            o Rule – English Law applies only to Rule C, but there must be a registered agent to avoid Rule B.
                      The arrest would have been vacated because English Law does not apply with Rule C.
                          Registered agents get you out of Rule B attachments.
                                Why? Registered agents allow you to “be found”.
       Royal Swan Navigation Co. v. Global Container Lines, LTC.
            o Facts – Royal Swan – foreign ship-owner. Defendant’s cargo came loose and they had to return to
                Canada to fix the cargo issues. D sued saying the captain screwed up to P. Plaintiff filed a Rule B

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                  attachment to get security – granted – warrants issued based on bank accounts in NY. Defendant
                  says it can be found in the district violating element 2 of Rule B. District Court says that the
                  Defendant is not there within rule B because there is no agent, but vacates anyway as unfair
                  because Plaintiff has not shown that it needs security. Plaintiff was not financially troubled. It
                  wasn’t really necessary.
              o   Rule – Abusive Attachment Exception – Judicially created exception which basically shows that
                  when the Plaintiff cannot show the need for security the court can refuse to grant the attachment.
                        The “yeah, but do they really need it” Defense.

Complications

Jury Trials

       Fitzgerald v. United States Lines Co.
             o Facts – Seamen can sue under the Jones act, which he did and also sued under “maintenance and
                 cure” under General Maritime Law. The right to jury applied to GMT claim and not to Jones Act.
             o Issue – What happens when you have multiple claims which are factually the same giving rise to
                 the claim under two different theories.
             o Held – Juries can resolve all claims even where they arise only under Admiralty Law, it does not
                 forbid right to jury trial as well.
             o Rule – Both pure admiralty claims and GMT claims can be combined and resolved by jury
                 because doing otherwise might lead to inconsistent verdicts. (THE RULE – SCOTUS)
       Vodusek v. Bayliner Marine Corp.
             o Facts – 1 Claim in Fed Court under Diversity (Rt. To Jury) and another claim under Admiralty JX
                 (no Rt. To Jury).
             o Held – Circuit split – 4th Circuit – Yes jury to both; 5th – no jury to both. SCOTUS has not granted
                 cert.

Venue, Forum Non Conveniens, and Choice of Law

       Bailiff v. Storm Drilling Co.
            o Facts – St. Clair County – Jones Act Case where a guy was working on a harbor boat in 2001 and
                   broke his leg. He was working after discharged. Could so whatever but sued saying he wanted a
                   state court – St. Clair County judge – fine under the “Savings Clause”. The judge gave $12k lost
                   wages - $7k maintenance and for pain and suffering $320k. Appealed to the IL Supreme Court
                   saying they had a right to jury under the Jones Act.
                         Statute Reads – “Any seaman who should suffer personal injury in the course of his
                            employment may, at his election, maintain an action for damages at law, with the right of
                            trial by jury.
            o Issue – Does the statute say that D is allowed to a jury?
            o Held – Yes.
            o They have a right to trial by jury
            o 5th Circuit says right to trial by jury.

Personal Injury and Wrongful Death
Seafarers
“Seaman Status”


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   Jones Act
        o Allows seafarers to sue employers for negligence.
        o Unique benefits
                   Plaintiff can sue in state or federal court – cannot be removed even with diversity
                      jurisdiction. Allows a jury trial at state level.
                            Note – 5th Circuit allows plaintiff to allow a jury duty.
                   Only applicable to employers and also true of Maintenance and Cure claims.
   Seaworthiness
        o Owner of vessel.
   Maintenance and Cure
        o Is only applicable to sue employers.
   Congressional Protections
        o The US Code listed by statute a daily food and beverage allotment that ship-owners had to give to
            seafarers. Congress cares A LOT about protecting seamen.
        o Federalism
                   More federal interest = less state interest.
                   State interests get a bit bigger in the context of non-seafarers.
   Offshore v. Robinson (5th Circuit 1959)
        o Who is a seaman? Meets these requirements:
                   1) Employee working on or in connection with a vessel in navigation; and
                   2) Employee had a more or less permanent connection with that vessel; and
                   3) Employee primarily aboard vessel to contribute to function of the vessel.
                            Johnson – 5th Circuit is wrong – 7th Circuit said that the 3rd element is actually –
                                “Employee aids in vessel’s navigation/transportation functions.”
                                    o Much narrower standard and led to the Supreme Court decision later.
        o McDurmot – EE was sand blasting fixtures in the gulf. Defendant claimed plaintiff failed the test
            because he did not “aid the navigation/transportation” functions.
                   SCOTUS clearly rejects 7th Circuit.
                   3) Employee must be “doing the ship’s work.”
        o ^ Still did not answer the question satisfactorily enough … led to …
   Chandris, Inc. v. Latsis
        o Facts – Plaintiff was a salaried superintendant engineer for a cruise company. He was supervising
            all the engineers on all the cruise ships. His office was on land but would frequently go on
            voyages on the ships to see how the ships were and monitor the vessel. Plaintiff said that he spent
            about 72% of his work-time at sea, the employer said it was more like 10%. Why does it matter?
            Substantial connection usually comes down to how much work time is attributed to doing the
            ship’s work, not being a once-a-year type of deal. The nature of the employment must be to “take
            on the perils of the sea” in a way. Jones Act does not actually define what a seaman is. He went to
            the doctor complaining about his eye and the Dr. did not send him to the ER and they left on the
            voyage and by time he got to Europe they finally did surgery on his eye and lost 75% of his
            eyesight. He went back to work and was fired. He sued. The jury in Federal court said he is not a
            seaman. The District Court said he had to be permanently assigned; Ct. of Appeals said the jury
            instructions were wrong, the test was: is the plaintiff’s connection substantial in nature and
            duration and has hazards of the sea. SCOTUS reviews the standard of seaman status.
        o Issue – What is the relationship the worker must have to do with the vessel regardless of task
            performed?
        o Analysis – If a member of the crew is damaged while on voyage – they are covered historically.
            (Voyage Test). SCOTUS rejects this argument – Status does not depend on where the injury


                                                                                                               15
                occurs, seafarers do not lose status on shore and non-seaman do not gain status when on the ship.
                There is no shifting liability.
           o RULE – you are a seafarer based on relationship and duration: the connection an employee has to
                the vessel.
      Seaman Status (Cont.) SCOTUS RULE
           o (1) Employee duties must contribute to the function of vessel or accomplish its mission, “must do
                the ship & work”; AND
           o (2) Must have a connection to a vessel in navigation or an identifiable group that is substantial in
                both duration and nature.
                      “substantial” – generally SCOTUS says that anything less than 30% of seafaring will not
                           meet the test for seaman status.
                      Is this a question of fact or law?
                                 A bit of both – judge must set forth the legal standard but in the right case there
                                    may be conflicting evidence must conclude who is telling the test. Since the test
                                    can come down to +/- 30%.
                                 How do employers confront the 30% issue? Work records.
           o Hypos
                      Bartender on a cruiseship? Yes, doing the work. Blackjack dealers on a riverboat? Yes.
                                 CONTRIBUTION TO FUNCTION.
                      What about an office worker becoming a crew member by reassignment?
                                 Temporary? Employer.
                                 Permanent or long-term? Employee favored.
                                         o True reassignment? Reset the 30% rule.
                      What about working for another employer? Cannot use time for different employers.
      Carter v. Bisso Marine Co.
           o Facts – Employer sued by P who was in charge of the serving department. He alleges 2 injuries –
                one turning the trailer, the other unhitching. Doesn’t matter where it happens. D argues that it
                doesn’t matter because he is not a seaman. There was no vessel of navigation D says. This is an
                issue of fact. D says that less than 10% in 99’ and 22% in 98’. P says it was 50%. Material issue of
                fact is raised.
           o Issue – Is the plaintiff a seaman?
           o Held – Material issues of fact exist as to whether Carter breached the 30% threshold.
           o Analysis - Work on a ship that is dry docked might still be relevant to the issue of seaman status.
           o Employer’s Defense
                      Find out which period of time we are talking about.

Maintenance and Cure

      Warren v. United States (SCOTUS 1951) Test is very broad.
          o Facts – P was a seaman on shore leave. No problem with seaman status. On shore leave, he injured
               himself. Maintenance and Cure extends to shore leave. He was injured doing what? He was drunk
               at a hotel and grabbed an unsecured iron bar and fell off the balcony. Happened on the dates
               between leave and going back out.
          o Issue – whether or not the employer could be liable for the injury?
          o Held – it is available under the GML.
          o Analysis – This is kind of superfluous. Whether or not the convention exists, P gets his
               maintenance.
          o RULE – Maintenance and Cure extends to: any injury or illness while in service of the ship.


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                      Does not require injury even if it has nothing to do with the ship, as long as it arises in
                       course of the service of the ship.
                   If you get hurt or sick even when it isn’t the employer’s fault, you get maintenance and
                       cure. In the river context it is usually a daily rate. Then there is the cure which is the
                       medical care needed toward curing the illness, sickness or injury.
                   Negligence is TOTALLY UNRELATED, arises out of contract. Never depends on fault.
   Farrell v. United States (SCOTUS 1949) Significant limitation to Warren
        o Facts – P was a seaman on shore leave who got drunk and lost and overstayed the leave. On the
             way back he fell into a dry dock causing him great injury – blind and PTSD. He was treated in
             government hospitals. He said that he should get maintenance and cure.
        o Issue – How far does it extend?
        o Held – Only extends until maximum medical improvement is reached.
        o RULE – Maximum medical improvement is the best you can be cured. The law is curative v.
             palliative. Curative only means restoration of health while palliative is treating symptoms where
             this is not a hope of getting better.
                   Once medical care has hit its end curatively, MMI has been reached and M&C is over.
                   Curative = M&C (Until MMI is reached); Palliative = No M&C.
                   Realistically this can be blurred. Maximum Medical Improvement is a matter of fact, so if
                       you have a doctor that is able to testify that you have not reached MMI, which is the
                       issue.
                             You ask the court to ignore the treating doctor? It is a tough argument for the
                                 defendant to sell.
   Extent of Maintenance and Cure (Prostitution Cases)
        o Koistinen v. American Import Lines – Seaman on shore leave and to avoid getting beaten up by the
             pimp who was trying to ‘sell his good’, the seaman jumped from the brothel window and broke his
             leg. He is covered.
        o Matthews v. Gulf & South American – Seaman gets a broken jaw while having sex with a
             prostitute. Does not extend to M&C, he was participating in willful misbehavior.
   When does it not extend?
        o 1) Willful misbehavior – exceedingly rare situation. Generally, intoxication does not do it because
             seamen get drunk. Fight? Not willful disobedience.
        o 2) Intentional Concealment of a medical condition on a pre-employment physical – you are
             permitted to have them fill out a pre-permitted physical with tests and get them examined. If you
             lie/withhold information that is causally related to the injury you are now claiming, the employer
             can deny M&C.
   What happens when an Employer wrongfully denies M&C?
        o Get (a) attorneys fees; and (b) punitive damages (not usually covered by insurance)
        o PLUS your M&C.
   West v. Midland Enterprises
        o Facts – new deckhand brings porn and STDs. Strikes up conversation with the captain and he asks
             the seaman if he has ever seen a “man copulate with a chicken” and suffers damages. Sues for
             M&C on mentally scarring. Employer defends on willful disobedience.
        o Held – He gets M&C.
   Cancer?
        o Not a SCOTUS rule, litigation is starting on this. There has been a ruling that when the employee
             begins complaining of the condition is what matters because nobody can say when the event
             actually happened.



                                                                                                               17
Tort Remedies

      Seaworthiness
           o Not fault based, but strict liability. If it is unseaworthy, fault is not an issue.
      Duty of Seaworthiness Test
           o Shipowner must furnish a vessel and appurtenances reasonably fit for their intended use.
      Common Types of Un-seaworthiness
           o 1) slip-and-fall, slippery conditions
           o 2) insufficient crew
           o 3) incompetent crew
           o 4) inadequate equipment
           o 5) assault cases(?)
                      Some courts concerned about “reason to know”. Other courts say it doesn’t matter b/c
                          strict liability.
      Mitchell v. Trawler Racer, Inc. (SCOTUS 1960)
           o Facts – P is a crewmember of a fishing vessel. Sues under the “holy trinity” when he slipped on
                slime on a boat. Did not have to prove anything because it was unseaworthy. Trial held for P only
                on M&C. SCOTUS.
           o Issue – Does the duty to provide a seaworthy ship depend on fault?
           o Held – No.
           o RULE – This is strict liability.
      Ferguson v. Moore-McCormack Lines, Inc.
           o Facts – Seaman lost fingers and his job was to scoop out ice cream. He ends up cutting his fingers
                off. Jury gives him $17,000~. Appeals says that it isn’t within the realm of “reasonable
                foreseeability.”
           o Held – SCOTUS says it was proper to leave the question to the jury.
           o RULE – The standard is whether the “employers negligence played ANY PART” in the damages.
                      Featherweight burden of proof – only applies to Jones Act Claims. “Even the slightest.”
      Kernan v. American Dredging Co.
           o Facts – Vessel owner put the light 3 feet over the deck against the statute. Negligence per se, but
                there was no collision it was designed to protect against.
           o Held – Negligence per se doesn’t matter we don’t care why the statute exists to protect against.
                      Defendant company can still be held liable even though the purpose of the statute was not
                          to avoid fires but to avoid collisions.
      Gautreaux v. Scurlock Marine, Inc.
           o Issue – what is the proper standard for causation?
                      P lawyers tried to say this was comparative fault with respect for featherweight.
           o Causation is the only time when plaintiff = featherweight burden of proof.
           o Comparative fault for plaintiff as reasonable care with negligence. Seamen must act in reasonable
                seaman capacity. (Seaman = reasonable person standard, not slightest duty of care).

Longshore and Harbor Workers

      Longshore Act
          o 33 USC 908
                   2/3rds of Average weekly Wage X # of weeks as set forth in Statute for the loss
                   Types of Losses:
                         1. PTD – Permanent Total Disability. (Lifetime)
                         2. TTD – Total Temporary Disability. (Temporary)

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                           3. PPD – Permanent Partial Disability. (# of weeks based on severity issue)
        o   Most Longshore carriers do this on their own.
        o   Requirements to qualify for Longshoreman’s Act
                 903 – Stitus
                 904 – Status
                           Employee – Seamen and employees of the United States are excluded from the
                              long shore act. Just because your included in the Longshore act doesn’t mean
                              you can’t recover under state workers comp but you can only do one or the
                              other. Not both. Concurrent jurisdiction.
        o   Process of a Claim
                 To recover under the Longshore Act you need to file a claim with the dept with labor.
                     The employer then has 10 days to either pay or dispute the claim. The claim then goes to
                     an informal hearing. If the dispute is still live then it goes to an administrative law judge.
                     You can appeal this to a hearing by the benefits review board then to the circuit court
                     where the injury occurred.
                 33 USC 9928
                           Fighting a Longshore Act ruling? If you reject an informal ruling and the
                              employee wins – the plaintiff gets attorney’s fees from that point on.
                                  o ONLY the employer assumes that risk.
   Sieracki
        o Held – a Longshoreman that does work customarily done by a seaman, has a claim for
             unseaworthiness against a non-employer vessel owner.
                  These people ended up being called “Sieraki Seamen”.
                           Review – Strict liability – Reasonable Fitness Standard.
        o Result
                  Injured Longshoreman filed claims:
                           1. Against Non-employer vessel owners for unseaworthiness; and
                           2. Against Employers under the Longshore Act
   Ryan
        o Facts – Ryan did the above strategy. The non-EER vessel owner attempted to indemnify this
             because the employer actually created the dangerous hazard.
        o Held – that the non-employer vessel owner could indemnify the damages
                  This continued. Longshore employers hated this.
                           Employers got screwed:
                                    o 1. Had to pay for disability under Longshore +
                                    o 2. Brought into court under Tort
                  STUCK WITH THE DEAL, MINUS THE BENEFITS OF LONGSHORE ACT
   33 USC 905(b) – “Vessel Negligence”
        o Ended Ryan and Sieracki
                  HOWEVER
        o An employee can still go after a Non-Employer vessel owner for “vessel negligence”.
        o “Vessel Negligence” or called “Scindia duties” are:
                  1. Turnover duty – if the condition which injured the longshoremen existed when the ship
                      owner turned the ship over to the longshoremen.
                  2. Active control duty – if the injury occurred in an area where the ship owner had active
                      control of during the injury
                  3. Duty to intervene – situation where a ship worker sees a longshoremen doing so
                      something stupid that he should intervene to prevent the injury. Hardest to prove.

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                   3 Yr SOL
        o   Risk of Litigation
                   If the Non-Employer Vessel Owner is even 1% at fault, the Longshore Carrier or
                      Insurance Company has a lien for all the money they paid against the Non-Employer
                      Vessel Owner.
   Maher Terminals, Inc. v. Director, Office of Workers’ Compensation Programs
        o Facts – Director is almost always a party. Refers to the Dept. of Labor to protects EEs. 50/50
            worker – One covered under the LA and the other not. On the date of his injury he was working a
            non-covered job for the past two weeks. His injury was hurting his arm when he fell off an office
            chair. He wanted coverage under the LA. There was probably something about his claim that
            made him wanted to pursue the LA avenue rather than state law. The procedural history goes (1)
            informal hearing (coverage)  (2) ALJ said nope  (3) Benefit review board vacated it and sent
            it to another ALJ who was there at the time who said that there can be assignment but there is no
            coverage because he was not assigned to LA coverage on that day  (4) Back to Review Board
             (5) Appealed to the Circuit Court 3rd Circuit.
        o Issue – whether the claimant, Riggio, who is a delivery clerk is a covered maritime employee
            under the Longshore Act.
        o Held – There is coverage here.
        o Analysis - Clerical workers are excluded only if it is their only function. Similar to the Jones Act,
            we don’t look at a snapshot at the time of what you were doing. Unlike “seaman’s status” the
            Longshore Act typically only requires “some time” which can be 2-5% of “Longshore Work”.
        o TEST - test for a Longshore or harbor worker – look at the regular portion of the overall tasks to
            which the claimant could have been assigned as a matter of course to determine whether he spends
            at least some of his time in indisputably Longshoring operations.
                   Status and Stitus Test – VERY BROAD.
   Pledger v. Phil Guilbeau Offshore, Inc.
        o Facts – Pledger sued 3 defendants in this case. He was employed by Halliburton Energy. Slipped
            while on the dock – does not sue Halliburton, but gets them for Comp. Why? He can’t. This case
            deals with Phil G. He is working for Halliburton – Stone Energy K’d with them – they chartered
            with Phil G for the boat “Tony G.” Aries towed the crew to Tony G. Meehan noticed that the deck
            of the Tony G. was slippery and held a safety meeting and they agreed they could do it safely –
            Pledger slips and is injured. Halliburton’s Longshore Carrier is just hoping that one of the D’s is at
            least 1% negligent so they can recoup losses.
                   3 Arguments:
                           1. Turnover Duty – wouldn’t this be an issue?
                                    o Exception to Turnover Duty – There is no duty to warn about open
                                        and obvious conditions.
                                    o Exception to this Exception – If there is NO OTHER WAY to do the
                                        work than subject EEs to the danger. No reasonable alternative. Eg. A
                                        vessel has a broken stairway (missing step) maybe the exception to the
                                        exception.
                           2. Active Control Duty – Limited to situations outside the area where the
                               Longshoremen are typically working.
                                    o More area = larger duty.
                           3. Duty to Intervene – this rarely applies.
        o Issue – What constitutes “vessel negligence” under 33 USC 905(b)? Are these duties applicable to
            the defendant here?



                                                                                                               20
           o   Held – Phil Guilbeau Offshore, Inc. is not liable because none of the 3 duties were violated.
               Halliburton has no remedy against the Non-employee Vessel Owner.
           o Analysis – (1) Safety meeting proves it was open and obvious danger. Exception to the exception
               does not apply because they did not have to do it that day – they asked to; (2) Active Control did
               not apply either because the crew was not in control of cargo placement – the captain was only to
               select placement and keep the ship steady, and; (3) Duty to intervene – for the vessel owner to
               have to have a duty to intervene is too far removed.
      In Re TPT Transportation – Skip this, we went over this above.
           o Don’t worry about it. Goes through history.

Non-Seafarers

      Area of people where Maritime cares the least about. Can state law apply – in most cases, yes.
           o Claims by passengers usually.
           o GML – Covers passenger claims.
      Kermarec v. Compagnie Generale Transatlantique (Duty owed to Passengers/Non-Crewmembers)
           o Facts – Passenger fell descending a stairway. Sued in Federal Court under unseaworthiness and
                negligence.
           o Issue – Whether or not the defendant can be liable under contributory negligence.
           o Held – Defendant won in Circuit Court, but was overruled
           o RULE – Duty owed to passengers/Non-crewmembers legally aboard a ship is reasonable
                care. Stowaways – avoid intentional or wanton misconduct.
           o Analysis – General Maritime Law applies under a Maritime Claim, no matter if it is in state or
                Federal Court. GMT actions – pure comparative fault principle applies and trumps state law –
                even in cases where someone is not a Longshoreman or Seaman. Even though the DC was wrong
                to say there was no unseaworthiness claim b/c state law applies – they were right because
                unseaworthiness only applies to seamen.
                      Remember – UNSEAWORTHINESS ONLY APPLIES TO SEAMEN. The owner owes
                          this duty b/c they are the only one who can make their vessel seaworthy.
      Carlisle v. Carnival Corporation
           o Facts – Florida in 2003 Intermediate Appellate Court case. This decision is a minority rule but it
                is in Florida so it is an emerging trend. P’s were on a cruise and the daughter fell ill and the Dr.
                failed to diagnose appendicitis. The P’s went home and her appendix burst. They want to hold
                Carnival vicariously negligent because the D had a K with the Dr. The tickets said explicitly that
                the Dr. was not an employee of Carnival.
           o Issue - Should Kermarec extend to cover an independent contractor?
           o Held – Vicarious liability extends here because the Plaintiffs had no alternative in this case.
           o Analysis – Vicarious liability exists w/o a doubt when Dr. is an employee or crewmember.
           o How to get around this?
                      Have 2 doctors on board – starboard and portside doctors!
      Cutchin v. Habitat Curacao
           o Some Brief Context
                      Historically EER’s of seamen would try to reach a quick impromptu remedy before the
                          seaman knows of his rights.
                      IF you are claiming a release or settlement of liability, the Defendants must show:
                                1. Seaman knew what they were doing.
                                2. Knew all of their rights.
                                3. The exchange was free of coercion.


                                                                                                                  21
                         This is the reverse of normal law. IF there is an unrepresented Seaman, you have a very
                          strong burden of proof to show that Seaman knew their rights and what they were doing.
                                What will lawyers do? Have a court reporter. Then explain EVERYTHING on
                                    the record – then sign the thing.
           o    Facts – This case has to do with passengers. A scuba diver sues for injuries. D’s say that he
                released liability. P claimed that they failed to provide trained personnel. The P had hundreds of
                dives in the past.
           o    Held – 1. There was an informed agreed to danger of diving; 2. The clause was not inconsistent
                with public policy, and; 3. The clause does not constitute an invalid adhesion contract.

Wrongful Death
Two Statutes

      Survival Action
           o Refers to the idea that the victim’s estate should be able to recover for injury prior to death.
      True Action
           o Descendants sue for the damages they have incurred
      Harrisburg (Overruled by Moragne)
           o GMT does not recognize wrongful death.
      Legislative Response
           o DOHSA – Death on the High Seas Act (EXCLUSIVE ACTION)
                      Cause for any person caused by fault (negligence, unseaworthiness, strict, etc…) so long
                         as the death occurred roughly 3 ½ miles out to sea. As long as you die outside state
                         territorial waters, you can sue.
                      Neither state law or GMT can supplement it, it is exclusive. 3 year SOL. State or Fed
                         court.
                      True wrongful death statute (see above), not a survival action.
                      Damages – limited to pecuniary losses (money losses)
                               Examples: funeral expenses, loss of inheritance, support.
                               Not covered: mental losses.
           o Jones Act
                      Limited to pecuniary losses.
           o Longshore Act
                      Death benefits against employer, did not preempt suing against a non EER.
           o Remaining Gap – people who are not seaman or longshoreman w/I 3.5 M of the shoreline.
      Courts on the no-seafarer/longshoreman Gap
           o Since there is no legislative act and GMT does not recognize such an action, you can sue under
                state wrongful death statutes.
      Tungas
           o Are state unlawful death statutes for people not covered by Jones, Longshore or DOHSA.
           o If you are going to sue under state law, you have to take all of the state law. (5 concur)
           o 4 dissent – have to provide the remedy.
      Moragne v. States Marine Lines, Inc. (GMT Wrongful Death for seaman)
           o Facts – P (widow) sues for wrongful death under state law unseaworthiness/negligence. D (non-
                employer vessel owner) removes for diversity into federal court. Then D files a 3 rd party complaint
                against decedent’s longshore employer for unseaworthiness for contribution. District Court tries to
                dismiss the unseaworthiness claim for wrongful death. On Appeal – the court decides they need to


                                                                                                                 22
             look for Florida law and see if they have a standard for unseaworthiness. They ask a certified
             question whether FL recognizes a wrongful death suit under unseaworthiness because they must
             use all FL law under Tungas. FL responds no, so 5th Circuit affirms. SCOTUS takes the case.
        o Issue – Should there be recognition of unseaworthiness wrongful death when there is no state law
             to help the plaintiff.
        o Analysis – 3 factors left the law in an untenable state if continued, SCOTUS looked at as a
             Harrisburg case:
                   1) Fed law gives remedy to injury.
                             Why do that but not give remedy for death?
                   2) DOHSA gives remedy if ship is 3.5 mi out to sea.
                             Why does this make sense?
                   3) Jones Act Seamen lack remedy, but longshoreman don’t?
                             Seamen are supposed to be the wards of the sea, but we give them no help?
        o Held – Harrisburg is overruled and GMT law does recognize a right to remedy under
             unseaworthiness. The wording is too ambiguous so basically it isn’t limited and courts do not just
             limit it to longshoremen. DOSHA was simply filling in the gaps around other law, but they didn’t
             think about the fact that state courts didn’t have unseaworthiness standards because they simply
             were not a strict liability standard which became the principle way people recovered. It left courts
             with dealing with this.
   Miles v. Apex Marine Corporation
        o Facts – P seaman killed by a violent act (repeated stabbing) of another crewmember. No spouse or
             children so his parents sued under the Jones Act for negligence and under GMT unseaworthiness
             in saying that the Gaudet damages should be available to him. The ship was in harbor. The mother
             sues in LA in Federal Court. Court awards 147k or something. Jury finds no loss of society
             damages. CT of Appeals reverses in part. No contributory negligence so the 7% goes back to her
             and further the ship was unseaworthy because the crewmember had a propensity for violence as a
             matter of law this is true. Court of Appeals go on to hold that even when the parents were not
             dependent they can get loss of society damages under GMT. SCOTUS separates this to two issues
        o Issue – can the parents of a dead seaman sue under GMT to supplement their damages such as lost
             future income; and, is there recovery for loss of society depending on whether she is financially
             dependent under GMT.
        o Held – Very much in the defendant’s fortune. Since the Jones Act doesn’t permit non-pecuniary
             damages, neither does GMT. Not in the Jones Act = not under GMT. There needs to be uniformity
             – must follow Congress. Gaudet damages do not apply under the Jones Act. Seaman does not get
             more damages under Jones just because GMT exists as well.
   Yamaha Motor Corporation, U.S.A. v. Calhoun
        o Facts – Calhoun and her friend are going with her friend’s family to a resort in Puerto Rico. Once
             there she rents a waverunner. She operates it at a high rate of speed into a moored vessel and dies
             instantly. Yamaha responds to the lawsuit in Fed Pennsylvania court. Yamaha moves for partial
             summary judgment for damages because under GMT in Miles v. Apex, damages for wrongful
             death are limited to pecuniary loss. There is no job, support, inheritance, but the only pecuniary
             loss is the funeral expenses. District Court sees how this is problematic. While Moragne did
             misplace damages, there is under GMT. Yamaha moves for an interlocutory appeal. 3 rd Circuit
             Court of Appeals says that while Moragne cannot supply these non-pecuniary losses, state law
             remedies apply and the plaintiff has state laws.
        o Issue – What do we do once we have limited actions to pecuniary loss, what do we do when a
             child dies. SCOTUS takes the issue of whether Federal Maritime Law supplies the exclusive
             remedy for deaths of non-seafarers of territorial waters.


                                                                                                              23
        o    Held – NO, Moragne is not the exclusive remedy of cases of non-seafarers in territorial waters.
             (Unanimous).
                   Unless they were willing to overrule Miles there really aren’t any damages but funeral
                      damages because they are really about maritime employees. This has not really arisen
                      yet. These causes keep being extended. They did not have any doubt that if Moragne is
                      the exclusive right for cause of death that most deaths are worthless under the law.
        o    How did SCOTUS get around this?
                   Moragne is not exclusive. If you want to you can still sue under state wrongful death
                      statute.
        o    2 Issues SCOTUS did not decide:
                   1) If we allow Calhoun’s parents go under Pennsylvania wrongful death, do we still use
                      Tungas? State law need to all apply? Not mentioned or overruled.
        o    Facts (Cont) – District Court then goes and allows the plaintiffs under Tungas to use Pennsylvania
             law. Yamaha interlocutory appeal again under the 3 rd Circuit.
        o    Issue (2nd interlocutory) – How can maritime law not apply to the liability aspect of a case where
             maritime jurisdiction is present.
        o    Held – 3rd Circuit holds that 3 different laws apply for all of these.
                   Penn law to compensatory
                   Puerto Rice to liability
                   GMT – what
        o    They go to trial = no liability. Case never got there.
        o    Never overrules explicitly Tutungas – it really has to though.
   Amtrak
        o Facts – Warrior Towboat Captain is pushing barges on the Mobile River and looking for a place to
              tie off until the fog lifts and goes into a tributary and sees an object the thinks he can tow off on. It
              was an Amtrak railroad bridge. He contacted it. The rail becomes misaligned and a train is on the
              way. Several cars derail and we end up with 47 dead and over 100 personal injuries. All of these
              people have zero to do with Maritime Law. They filed for a liability of damages action. This was
              in Alabama federal court. Alabama has a wrongful death statute saying the only type of damages
              for wrongful death is punitive damages. You have to show simple negligence. What the actual
              fuck? All the lawyers in Mobile for their clients cite Yamaha to get the remedies under Alabama
              law. Warrior and Gulf respond saying that Yamaha had nothing to do with this case because it is a
              commercial towboat colliding with a bridge and it is a traditional maritime activity governed by a
              non-seafarer case especially when the state law is Alabama’s. GMT is generally limited to
              pecuniary damages and Alabama law gives no allocation of fault. There is no contribution
              between defendants. This way, Warrior cannot claim that Amtrak should have known. Basically, if
              we apply Alabama wrongful death, we permit non-pecuniary damages (the worst kind) upon
              simple negligence which is blatantly contradictory to GMT. 11 th Circuit agrees with Warrior Gulf
              because this situation, unlike Yamaha is traditional maritime and because Alabama law is so out
              of skew, we cannot accept this and uniformity requires them to use Maritime Law.
        o Held – Cert. denied by SCOTUS.
   Plaintiffs are almost invariably trying to assert state law in wrongful death to get non-pecuniary damages
    and defendants are unanimously trying to make sure that GMT applies so just pecuniary damages apply.
        o There has been no current trend or rule to resolve this with a situation with a non-seafarer.
        o In these cases:
                    1. Yamaha – SCOTUS – If you are a 12-year-old girl who dies in P.R.
                    2. Amtrak – 11th Circuit
                               Falls on traditional maritime activities.


                                                                                                                    24
Breaking down the Past Few Weeks

      Categories of Plaintiffs
           o Seafarers (Seaman)
                    Who Qualifies? Chandris
                    What do they get? Holy Trinity – M&C (GML), Unseaworthiness (GML) & Negligence
                        (Jones Act).
                    Federal or State – Federal
           o Longshoremen
                    Who Qualifies? Non-seaman maritime workers.
                              Fail Chandris, but still work 2-5% seaman activities
                    What do they get? Longshore compensation benefits (Against ER) + Section 905(b) [Tort
                        against non-ER vessel]
                    Federal or State – Federal and State (comp law)
           o Non-Seafarers
                    Who Qualifies? Anyone that does not fit in those two. “Temporary connection” to
                        maritime activity – usually. (12 y/o on jet ski)
                    What do they get?
                              Personal Injury – Keramec
                              Wrongful Death
                                     o Yamaha or
                                     o Amtrak
                    Federal or State – See above under What do they Get

Limitation of Liability
      Basics – Lexington +
           o Back in the day we used to have shippers that would take cargo as long as the shipper took
                liability of the cargo loss of clients.
           o The Lexington caught fire because of unseaworthiness, etc. In the wooden crate of one of the
                customers had shipped money of $22k which in 1840 was a lot. The bank went after the ship
                owner. They responded with the liability clause K.
           o A year later – CA gold rush. A huge movement toward building a shipping industry in the US. In
                1851 a Congressman from Maine introduces the limitation of liability act modeled after an English
                statute. The gist was that if there is a maritime casualty outside the privity and knowledge of the
                owner, they can limit liability to the ship.
                      There was no enforcement means for the courts.
                      SCOTUS set up procedures and rules. (Modern Rule F)
      Rule F (READ THIS ALL – ALL FAIR GAME)
           o Shipowners can file this in Federal Court only.
           o SOL is very short – 6 months after the shipowner receives notice of a claim in writing.
                      If the accident happens in 01’ and a letter comes in 03’, the SoL doesn’t run until the
                          written notice of claim is received.
           o 3 Options with the limitation fund:
                      1. Deposit money into the court representing the FMV of the vessel.
                                Not used often.
                      2. Post security for your interest in the value of the ship through a bond. A marine
                          surveyor will say it is $100k and a trusted surety will make a bond.
                                Common

                                                                                                                25
                   3. Actually deposit the ship itself.
      o      Amount of Limitation Fund = amount of the FMV after the accident. After a sinking = Zero.
                   PLUS: “Pending Freight” which = what you would be earning moving the freight or
                      passengers, and not the value of the freight.
                   Not cargo.
       o Statute – Supplemental Statute Fund
                   Only in the oceans and only when wrongful death or injury.
                   $420 per gross ton can be required. (We don’t need to know).
       o Under Limitation of Liability you can get
                   Exoneration; and
                   Still never reach the question of limitation.
       o What happens after filing?
                   The rules immediately give you an injunction barring:
                            1. Further prosecutions against you for such casualty.
                            2. Further lawsuits from being filed.
                   So you get an immediate injunction.
                   In the issue of mass casualty or property damage, do it ASAP. Massive advantage.
                   Benefits
                            Choice of forum
                            Do it all at once.
                            When everything is brought together it is called a concursus
                   Afterward, plaintiffs must file within 30-60 days and must file in that court.
                            Courts give notice to plaintiffs, there is no set time they have to use.
                                   o MUST BE SENT TO ANYONE WHO HAS MADE WRITTEN
                                        CLAIM TO YOU AND PUBLISH IT IN A PAPER OF REGULAR
                                        CIRCULATION FOR 4 CONSECUTIVE WEEKS.
                                   o Only the people that have made it, and publish it in a newspaper.
                   Shortens the SOL of other people.
                   Claim is filed then asking for damages, etc.
                   Claimants have an opportunity to seek an increase in the amount of the limitation fund.
                      The limitation fund is set by the shipowner at the time of complaint.
                            The claimants must dispute the amount of the fund, courts won’t question it
                               unless a claimant raises the issue and then a hearing is held.
                            Shipowners usually have an affidavit stating the FMV of the ship.
       o Trial During Limitation Act
         Claimants                          Shipowner             Claimants            Other Claimants
1. Have burden of proof to          2. Shipowner has the            3. Claimants must 4. The court
establishing the liability          burden of proof to              prove the amount
(Negligence, unseaworthiness,       establish a lack of privity of their damages.
other fault)                        or knowledge with respect
                                    to the fault claimants
                                    established in Step 1.
If they fail, the shipowner gets    If shipowner fails, there is If so, then the
exoneration and the case is         no exoneration or               opponents for the
over. If they succeed, then Step limitation. If the                 claimants become
2                                  shipowner succeeds, then        the opposition.
                                    the limitation is granted       The claimants
                                    and proceed to Step 3.          distribute the
                                                                    limitation pro
                                                                    rata.

                                                                                                              26
                         “Privity or Knowledge” – Must not have knowledge or reason to know of the fault.
                         Pro Rata Example:
                               Assume Step 1, 2 are complete.
                               Step 3 – CL A comes in and proves dmgs of $300k and CL B proves dmgs of
                                   $100k, and the limitation fund is determined to be $80k.
                                        o CL A – Amount of its claim ($300k / total amount of all claims =
                                             $400k) =75% = $60k.
                                        o CL B – 25% of 80k = $20k.
                         Exception to Pro Rata
                               If there is a joint tortfeasor.
                               The only time we split things Pro Rata is if there is zero fault. We pay all the no
                                   fault claimants first. If you get even 1% fault you will get nothing.
       Justification
             o Other countries had these, so if we wanted to compete we needed one as well.
             o Unfair to impose liability on the shipowner for things beyond their control.
       Why do we still need this as there is liability insurance?
             o Insurers are the only ones who really care about this anymore.
             o Limitation of Liability clauses are still very common, why don’t we just use contract as opposed to
                  the limitation act which has nothing to do with K.
             o Some (many, really) courts view the reasons to be substantial to narrowly interpret the limitation
                  act.
             o Other courts say this is the job for the legislature.
       Ways around the Limitation Act:
             o Limitation Act is not applicable to captains and crewmasters of vessels. Sue the captain
                  individually. LA only applies to shipowners.
                        How does that help though? Insurance. Some marine insurance policies cover negligence
                            of master and crew. If they can’t seek limitation, neither can the insurance company.
                            Some policies cover it, some don’t. The first thing you should do is see if they cover
                            negligent acts of the crewmaster and captain.

Availability

       In Re Complaint of Shell Oil Co. (Wide Availability of NOLA)
            o Facts – Shell Offshore Inc. was the actual owner of a jack-up barge in a bay. Its affiliate, Shell Oil
                Co. They used to be the owner.
            o Issue – Who are the shipowners who get to use the LLA between Offshore or Oil?
            o Held – They are both permitted to assert it.
            o Analysis – Record owners, bareboat charters, operators even if they don’t own it, can do it.
                      You can pursue limitation if the claim is based upon ownership.
            o Rule: Definition can be owner, operator or controller. You do not need be “actual owner.” Dual
                capacity is universally rejected – if I’m not going to sue you as “owner operator” and sue under
                another theory it doesn’t matter about which theory. Type of liability doesn’t matter.
       Complaint of Ta Chi Navigation Corp S.A. (SKIP)
       Crown Zellerbach Corp v. Ingram Industries Inc. (K Clauses can extend NOLA benefits to insurers)
            o Facts – Step 1 and 2 are satisfied here. Claimants prove dmgs of 3.1 and liability is 2 million.
            o Issue – Does the shipowners insurance co need to pay the difference of 1.1 million?
            o Held – No.
            o Rule: Insurance companies get the benefit of the Liability Act if they have a clause in the contract.


                                                                                                                 27
Privity or Knowledge

        In Re Muer (Not majority law)
             o Facts – Muer owns a pleasure craft and had xfered ownership to his corporation. He and his wife
                  went out, he was captain. They crashed and people died. Claims were filed against Muer +
                  Corporation. LLA was filed. MSJ filed by P because he should not be able to use the liability act
                  based upon the fact he must have had privity or knowledge.
             o Issue – How could Muer ever prove Step 2 because he must have privity or knowledge since he
                  was the captain?
             o Held – In a limitation action, we can’t get to Step 2, unless we get to Step 1.
             o Other courts have accepted the idea that when the shipowner is the master of the boat, there is no
                  point of letting them pursue limitation of liability. How could a ship sink without the captain being
                  at fault?
        In Re Hellenic Inc. (Realistic outlook on Limitation cases in litigation as to defining PorK)
             o Facts – Athena (marine construction), K with Texaco to make an oil pipe. They used a barge with
                  hydraulic legs. The wind moved it and it struck another pipeline which cost $1/4M to repair. They
                  all found that the manager decided to leave it on spuds. Athena files for limitation. Claimant met
                  step 1. Step 2 not met. Dana Lee was high enough in the company found at 60% (construction
                  manager). Reversed on appeal. Limitation should be granted because Lee was not high enough on
                  the corporate ladder.
             o Issue – how high up the ladder do you have to get to establish privity or knowledge.
             o Held – Lee did not have “privity or knowledge” for the company.
             o Rule: 8 factor balancing test
                        1. Scope of authority of day to day
                        2. Field of significance
                        3. Hire or fire
                        4. Make K
                        5. Set prices
                        6. Authority of payment of expenses
                        7. Whether the agent’s salary is fixed or contingent; and
                        8. Duration of authority (full time or shift)
                        Basically – not master or captain, you do not have authority to defeat privity or
                            knowledge. Crewmates negligence will not defeat privity or knowledge limitation.
                                  You need a shore-side manager making decisions basically.
             o Facts (cont) – Lee had no authority once the job was completed, didn’t really meet a lot of these
                  factors. They weighed against Lee having sufficient corporate authority to meet “privity or
                  knowledge”.
        Note – the rationale for this rule is pretty stupid today because of current technology.

Claims

        Mediterranean Shipping Co. S.A. Geneva v. Pol-Atlantic
            o Facts – MD Clara leaves France for the US. Med shipping is a bear-boat charter and the operator
                 of the vessel. PLO and ACL are “slot charters” who have a K. PLO and ACL are to find customers
                 to find cargo for MSC to move around. The owner and MSC sought LOLA protection. 1,600
                 claims were filed against MSC. The cargo owners, being smart, knew that the owner and operator
                 could file LOLA actions so they file against PLO and ACL. They are not “owners” and cannot
                 pursue limitation. In response PLO and ACL file 3 rd party for indemnity because they have
                 liability under the master K which includes a warranty of seaworthiness. Master claims must be

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                sorted in arbitration normally, but concursus under the act. The ct. of appeals vacates and says that
                the PLO and ACL claims are really for breach and not subject to limitation; therefore, these claims
                can be arbitrated.
           o Issue – When you have to defeat a limitation action when you must rely on a contract what do you
                do?
           o Held – use the “Personal K Exception” to say that the claims you have are not subject to any
                limitation because they are covered by K.
           o Rule: A shipowner may not use LLA as a defense to breach of K.
      In Re Transporter Marine, Inc. (ADMINISTRATIVE AGENCY RULINGS – They do what they want)
           o Facts – MV Transporter file for limitation after claimant lost both his legs. Coast Guard filed
                administrative proceedings against MV for failing to properly comply with regs requiring drug and
                alcohol tests following a serious injury.
           o Issue – Is the CG claim against MV subject to limitation?
           o Held – No.
           o Rule: If a regulatory agency wants to pursue you based upon Administrative regulations, they are
                not subject to limitation.
           o Closer Case (C Split)
                      Boat has to go through a loch and current carries the vessel into the loch doing damage. A
                          shipowner can in some circuits seek LLA, and in others, not.

Procedure

      Esta Later Charters, Inc. v. Ignacio
           o Facts – 9th Cir. There is an explosion on a vessel. The next month one of the victim’s parents signs
                a settlement or release for $5000. Weeks later, Ignacio sends a written demand. After no response,
                he sues. The people who settle decide they are going to sue as well. Ignacio later amends his claim
                and adds his newborn son that was born. He will never know his father. Esta Later goes into court
                in December and files a limitation action within 6 months of the suit.
           o Issue – Does the 6 month modified SOL in Rule F apply to each claimant separately, or do later
                claimants benefit.
           o Held – 1 notice applies to all.
           o Rule: The SOL in Rule F requiring a written notice, if one claimant sends, the clock has started
                running for everyone.
      Lewis v. Lewis & Clark Marine, Inc. ( Most Important Case )
           o Facts – Seaman working for L&C Marine, Lewis, tripped on a wire and hurt his back on the
                tugboat in St .Louis. He sues under the holy trinity in Madison County. This case was pre-
                Bowman and does not demand a jury and a defendant cannot get a jury. Ship-owner files a LOLA
                claim. Fund is set at $450k. There is a serious disagreement here – on one hand the ship-owner
                can seek LOLA, and a seaman has a right under Jones and Savings Clause to sue in state court.
                You get no jury in a limitation case and he could in state court.
           o Issue – what happens in a case like this?
           o Held – As long as ERs can still use LOLA, the claim can be adjudicated in a state court.
           o Rule: Courts have created 2 exceptions so a Rule F injunction barring state court can be modified
                to balance these interests:
                      1. Adequate Fund Exception – Basic theory is that as a plaintiff in state could you want to
                         get out of a limitation case. One way out is by stipulating that the value of the claim is
                         technically $449,999.00. MOOT A LIMITATION CASE by never holding a shipowner
                         for more than the limitation fund. It isn’t “dismissed” just modified injunction to recover
                         one dollar less limitation fund.

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                         2. Single Claimant Exception – from Ex Party Green – Theory here is that the whole
                          point of a limitation case is for a concursus of claims. With one claimant, that interest
                          does not exist. You don’t file a stipulation about the fund, just how many claimants there
                          are. There is one state court suit and if they do it – they decide liability and damages, and
                          if I get a verdict higher, then and only then, will limitation be heard in federal court.

Towage
Generally

       Defined – a vessel (aka a “Tug”) which moves other vessels, (aka “Tow”).
            o Types of Tow
                       Ships going through loch
                       Barges
                       Salvages
                       Ones too big to navigate through harbor.
       Towage is not contract for freightment! About the movement of a vessel.
            o Towage is not a bailment.
       Test analysis
            o 1) Towage; or
            o 2) Contract for freightment?
                       LAW IS COMPLETELY DIFFERENT FOR BOTH.

Nature of the Relationship

       Stevens v. The White City (What is Towage v. Bailment)
            o Facts – Plaintiff, Stevens is the assignee of the owner of a 40-ft. powerboat called the “Drifter”.
                 The White City did the towing on the “Drifter”. They put a guy on the boat to tend to its lines.
                 When the WC arrived they realized that the steamer they were supposed to use had already left.
                 Decided to wait a day. Simpson went aboard the Drifter, found she was fine, took it to meet
                 another steamer and found that the “Drifter” was damaged. District held that this was a bailment,
                 thus the owner was liable. Appealed overturned, cert granted.
            o Issue – Was this a bailment?
            o Held – No, it was a towage contract.
            o Torts 101 Bailments
                       (1) Delivery of goods (vessel) in good order;
                       (2) in the exclusive control, case and custody of the Defendant; and
                       (3) Goods returned to the owner in damaged condition.
            o Analysis – If you can make a case for bailment, it creates a rebuttable assumption of negligence on
                 the defendant. The presumption applied and it was not rebutted on district level. But this wasn’t a
                 bailment situation at all. The defendant cannot prove fault under towage. There is no presumption
                 that need be overcome. It is immaterial that the D’s employee did not stay on until the end.
            o Problems: As a barge owner, this hurts unless you can prove negligence. This is a pretty harsh
                 position for barge owners.
       Lone Star Industries, Inc. v. Mays Towing Co.
            o Facts – P is a cement producer and uses barges to x-port between Cape and Memphis. Bench suit
                 against Mays towing that the plaintiff uses to tug from place to place. Tug picks up Tow and Mays
                 though nothing uncommon happened in route. 3 days later, the barge sank during the unloading
                 process with most cargo on it. The plaintiff was responsible to unload. It was unloaded by one


                                                                                                                     30
                  person. Because of some ice, the person could not inspect the stern. They decided to take a
                  calculated risk to unload anyway. DC holds both parties at fault. 60% to Mays and 40% Lone Star.
                  8th circuit uses res ipsa loquitur was met.
              o Issue – Whether or not Mays was negligent in this case?
              o Held – No, by applying res ipsa loquitur.
              o Analysis – They found that the type of damage done to the barge by Mays was one in which
                  normal contact could not produced. None of the elements of res ipsa locquitur are arguably met
                  here.
              o Elements of res ipsa locquitur
                        (1) injured party w/o fault;
                        (2) whatever caused the injury is under the exclusive control of D; and
                        (3) It is the type of mishap that could not ordinarily occur sans negligence.
        A.S. Wikstrom, Inc. v. Tug Julia C. Moran
        Duties in Towage
              o Tug  Duty of reasonable

Exculpatory Clauses

        Bisso v. Inland Waterways
             o Facts – Towboat causes Bissos barge into a bridge and sinks the barge while it is being towed.
                   There are witnesses everywhere here. The tug drove the bridge into the pier. There is a towage K
                   that says (1) towage is being done at Bisso’s risk; and (2) the Tug’s employees are actually
                   servants or employees of the BARGE, not the tug. DC hold the second clause is upheld and says
                   that the tug is exempt. 5th Circuit affirms, but finds for both clauses and either were sufficient.
             o Issue – Can a tug K away its liability for negligent towing?
             o Held – SCOTUS 5-3 Reversed. Rationale under both clauses being wrong:
                         1) We have to discourage negligence by making wrongdoers pay for the damage caused.
                                   Kind of goes against insurance. Dissent points this out.
                         2) Court needs to protect those who needs good from overreaching from the tug
                             community. (Unconscionability?)
             o Industry hated this case … found ways to get around it in response and some courts allow this:
                         Insurance law – Primary insured can add an additional insured. Using this to get around
                             Bisso is that you take out insurance and add additional insured to the policy. Insurer
                             cannot come after an additional insured.
                         Twenty Grand Approach – Waiver of subrogation. If you don’t name an additional
                             insured, but there is still an accident. Insurers can generally subrogate the claim after
                             paying you, but if you waive subrogation against specific parties, and insurer will agree
                             not to go after specific people. (5th Circuit enforces it).
                         Bisso – talks about completely no liability, but some courts say that doesn’t foreclose
                             limitation of liability.
        M/S Bremen v. Zapata Off-Shore Co.
             o Facts – 1972 SCOTUS – Bisso is very minor view. Most countries do not follow this view. When
                   international shipping involving tugs and other nations do not want to follow this.
             o Issue – Can you use a forum selection clause to get around Bisso?
             o Held – Forum selection clauses are fine, aka Bisso only really applies to domestic towing.

Carriage of Goods (Contracts for Freight)
Basics

                                                                                                                    31
       Types of Contract
             o Common Carriage: Company that does this for the public at large, almost exclusively what the law
                 we talk about refers to.
             o Private Carriage: Almost completely left to contract b/t parties.
       Vocab
             o Shipper – Person that gets issues a bill of lading. They said they need a good x-ported from A 
                 B.
             o Carrier – does the transporting
             o Freight – the consideration paid.
             o Bill of Lading – K for carriage – allows title to be negotiated to the consignee.
                       Issued by Carrier when they receive product.
                       Clean bill – good condition goods. Noted if they are not.
       Often the shipper will tell the carrier to move these locked cargos to the carrier. On the bills of lading the
        Carrier will put “STC” (said to contain) on the boxes because they cannot look even if they wanted to.
       There is almost never a non-clean bill of lading.
       In the 20’s and 30’s, common carriers have huge power over the shippers.

The Harter Act (NOT ON THE TEST)

       Generally forbid exculpatory clauses allowing common carriers to avoid liability, defenses for a carrier
        were put in though:
             o 1) Negligent navigation - Defense to show that the carrier’s captain was negligent.
             o 2) Negligent management.
       COGSA – Displaces the Harter Act with oceangoing shipments.(Harter still works for domestic shipping).
             o Permits parties to domestic shipments that COGSA applies by contract. (Almost everyone does).
             o Applies from “Tackle to Tackle” which is from loading to unloading. Parties can K that it can last
                 longer.
       Shippers know everything about the cargo, but nothing about the vessel or the voyage. The opposite is true
        for the Carriers. Lack of good info raises the question of shifting burdens of persuasion.

Carriage of Goods by Sea Act (COGSA)

       United States v. Ocean Bulk Ships, Inc.
            o Facts – P ships cargo through various parties to Africa. It went to the Carrier, no dispute about
                clean bill. US files suit after damage is discovered after discharge. The DC said 50,000. Reversed
                on appeal and went to 203k.
                      Ping pong match:
                                   Shipper ( US)                              Carrier
                                   1. PFC – Prima Facie Case – Shipper 2. Rebuttable presumption of liability:
                                   has to prove only (1) Cargo received       Very easy to rebut. Carrier has to prove
                                   for loading undamaged (Clean bill of       either that: 1) they exercised due
                                   lading); and (2) damage existed at         diligence (reasonable care); or (2) a
                                   discharge (inspected by shipper post       showing of an uncontrollable cause of
                                   carrier possession). Very easy to          loss. (There are 17). 17th is a catch all.
                                   prove.                                     Presumption of liability defeated.
                                   3. Shipper must show that the              4. The Carrier must prove what amount
                                   Carrier’s negligence was at least a        or part of the loss is due to
                                   concurrent cause of the loss. They         “uncontrollable causes”. If they cannot
                                   don’t have to show that they didn’t        do this, then the Carrier pays 100% of
                                   exist, but that negligence was at least    losses sustained by the Shipper.
                                   a factor in the loss.

                                                                                                                     32
                           Ocean Bulk showed 17 Causes of Loss. Examples of the big ones:
                                  Errors by crew.
                                  Perils of the sea.
                                  Acts of god.
                                  Fault of 3rd parties.
                                  Fault of the Shipper.
                                  Fire.
       P&O Containers (About $500 limitation per package)
            o Facts – Congress gave shippers this ping pong to their advantage, but part of the deal is Carrier
                 liability is limited to $500/package. It was never defined. In 80 years it has never been increased.
                 There is 1 container that looks kind of a like a trailer full of perfume and cosmetics. It disappears
                 from a marine terminal in FL. The insurance company pays it, but subrogates the action against
                 the holder. The COGSA K can be increased, but never decreased. Shipper can declare price, and
                 the fright rate goes up. Carrier’s prices are based upon the limitation. If there is a loss the cargo
                 insurer pays them but then the insurance company will go after them. This one had 2,200 shoebox
                 sized cartons in the container. All but two of them are split on 42 wrapped pallets. Carrier argues
                 that there is ONE container. Shipper says 2,270. If it is $500 who cares, but if not then it really
                 matters. This is the first move about a partial move for summary judgment about the number of
                 packages.
            o General Rule – almost never is a container a package.
            o Issue – How many packages?
            o Held – the pallets are a “package”. So it is 42. Plus 2 extra. They file motion for partial summary
                 judgment and “win” 44 cases as max.
       Norfolk Southern v. Kirby (COGSA Transportation from carrier  sub-Ker  Buyer – chain of comm.)
            o Facts – Railroad was successfully able to enforce a maritime K bill of lading $500 limitation after
                 a derailing. They weren’t even the party, just the subcontractor. There is a Himalaya Clause which
                 says the liability limitation applies not only to ICC or any ship, but any subcontractor used from
                 the point of pickup until it gets to Shipper’s location of choice. These clauses are now standard.
                 ICC ships to Hamburg to another sub-K, the D, Norfolk and on its way the train derails for maybe
                 millions of dollars. Norfolk files a motion for partial SJ saying COGSA applies involving a
                 substantial sea leg but they get the benefit because of the clause. They argue that each rail car is a
                 package. They win
            o Issue – Can Norfolk enforce the COGSA limitation?
            o Held – Yes.
            o Rationale: We cannot allow state law to get in the way because of uniformity of Admiralty law
                 (citing Jensen).
       FN – Sumpo Japan Ins. Co. – Notwithstanding Norfolk, the 2nd Circuit held that the rail or truck leg are
        guided by Carmack amendment and cannot use Uniformity as a rationale.

Salvage
Property

       Provost v. Huber
            o Facts – MI man buys a house on the mainland and wants it x-ported to an island on the Great
                 Lakes. They get it 3/4ths the way there. They sink it to the bottom “gently” to salvage it. Trying to
                 raise it the following spring – the house falls apart costing $20M. Provost is one of the divers that



                                                                                                                    33
                was supposed to raise it. He tries to get paid – he doesn’t. He hires an attorney who argues that he
                was trying to salvage it under Maritime law.
            o Issue – is there jurisdiction?
            o Held – no.
            o Analysis – the cases discussed are a bit odd like this case. One of the ones they cited was one
                about a man with cash on his dead corpse. That was covered because he was going on a “maritime
                adventure”. A seaplane is also different than the present case because it was a “sea plane”. Since
                there was no success there would be no success here. Nothing was salved, it had absolutely no
                value. Why didn’t the court dispose of it that way
            o Rule – Standard for maritime salvage does not require a necessity of passing the
                Admiralty/Maritime Tort JX Test.
                      Property that can be salvaged = broader than admiralty jurisdiction.
       Peninsular & Oriental Steam Nav. Co. v. Overseas Oil Carriers, Inc.
            o Facts – Crew member of Overseas Progress had a heart attack and they called out for help.
                Canberra responded. It was bigger and faster moving. The ship came and picked up the guy,
                treated him, then brought him to the nearest hospital. The arrangement was signed by both
                captains saying that the Canberra would receive compensation for the services. There was no time
                to negotiate. The plaintiff is suing for costs and fuel.
            o Issue – Is this a salvage case?
            o Held – The court rules for the Canberra in the amount of $8,500 – not a true salvage award
                because there is no such thing as a “pure life” salvage. They basically do this under quantum
                meruit.
            o Analysis – This is a pure salvage case. You get an award if you save a life. Salvage, however,
                requires valuable property being salved. Here, the only thing they salvaged was a human. There is
                no recovery under salvage law.
                      There is a duty to rescue at sea, not on land though. This is Federal Law.
                      Vessel has a requirement to provide assistance.
            o Case of Fire – One ship gets the passengers, the other the cargo – who gets the award?
                      Both ships should get a cut of the % award.

Requisites

       Salvage
            o 3 ELEMENTS REQUIRED
                       1) Marine Peril
                       2) Voluntary Aid
                       3) Success
       Alternate Theory – Law of Finds
            o Elements
                       1) Intent to Reduce Property to Your Possession
                       2) Actual Possession of the Property; and
                       3) Abandonment by the True Owner.
       This law is all about giving title to the finder. Salvage isn’t about awarding title, but a financial reward for
        coming to the aid successfully of property at sea.
       Treasure hunters – they abandoned the property, but not voluntarily. It’s a problem. Salvage has its own
        problem with historical wrecks being found because we are worried about marine peril.
       Abandoned Shipwreck Act – 43 USC 2101-206
            o The USA asserts title to any abandoned shipwreck that is:
                       1) Embedded in the submerged lands of a state; or

                                                                                                                       34
                     2) Embedded in coral formations protected by the state on submerged land; or
                     3) Submerged lands included in or eligible for inclusion in the national registry.
            o Congress never defined “abandoned” – this statute does not get around the problem, just gets
                another party involved. The true owner and salvage will come in and get involved.
      State Salvage Laws – usually preempted.
      Acceptance of Salvage – you don’t need to accept it, but if the owner has abandoned the property, they
       cannot decline salvage after the fact.

Marine Peril

      B.V. Bureau Wijsmuller v. US
           o Facts – MV Pioneer Commander was a vessel owned by US Lines, Inc. which set sail from West
               Germany for NJ. There were 757 tons of cargo on board by the defendant USA. IT was valued at
               around $6.5M. It ran aground and could not extricate itself. It called for help, but the boat was not
               at immediate risk, just stuck. Plaintiff is a professional salvager and they sent The Typhoon under
               a “no fault, no pay” agreement. They don’t succeed, they do it for free. If successful, there was no
               agreed upon amount. Time was essential here. The salvage agreement required arbitration, but the
               USA (cargo owner) refused based on sovereign immunity. SDNY and 2 nd Circuit affirm judgment.
           o Issue – does this satisfy a marine peril?
           o Held – Yes.
           o Rule – Peril need not be impending or absolute risk, but a reasonable apprehension of
               injury.
                      Calling for help usually satisfies this.
                      Salvage award gives maritime lien against the property.
      Treasure Salvors, Inc. v. Unidentified Wrecked and Abandoned Sailing Vessel
           o Facts – Two FL Corporations are competing for possession and confirmation of title to an
               unidentified wrecked and abandoned vessel thought to be the Nuestra Senora de Atocha. It sank
               off the Marquesas Keys in 1622. It is undisputably an abandoned ship. The US claims title. The
               court of appeals modified it. The US claims that there is no marine peril, thus, not a salvage.
           o Issue – whether or not a wreck can fulfill the marine peril requirement?
           o Held – Both law of finds and law of salvage would require that all of the derelict property is in
               title of the plaintiff. The peril can be getting lost again at the bottom of the sea.
           o Rule – Peril can equal getting “relost” at the bottom of the sea.

Voluntariness

      The Tashmoo
           o Facts – Tashmoo was sued in rem for salvage award. The Plaintiff is a crewmember of the vessel.
               He was working as a “workaway” for $.30 c/month + trip to NY. The engine is disabled on the
               voyage. It only carried 11 passengers and around $1/2M of Cargo. They were not required to carry
               a wireless apparatus. Nobody but P was able to set up to send and receive messages. He did so and
               called for a nearby vessel’s help. They give help. They ultimately get back to Mexico. P sues in
               SDNY under salvage.
           o Issue – Whether or not this was voluntary when the plaintiff is a crewmember?
           o Held – no.
           o Analysis – he was under the control of the master of the ship and was commanded to do so, thus,
               he does not satisfy voluntary assistance because it was in the course of duty. Job duties are very
               broad as a crew member.



                                                                                                                 35
              o   Rule – as a crewmember, it fails the voluntary prong unless you were a crewmember of an
                  abandoned ship.
         Nicholas E. Vernicos Shipping Co. v. United States
              o Facts – Another 2nd Circuit case. Deals with who gets the salvage. The USAs vessels are provided
                  salvage services. No question about peril or success. The question is about whether or not the
                  people that rendered the aid did so voluntarily because they were salvers. Do you have to be
                  innocent or happenstance or is it okay to be industrial salver.
              o Issue – Whether or not being a professional salvor takes you out of element 2? Who gets the
                  salvage award?
              o Held – No (majority rule). Historically individual crew members on the vessel; but now, it is
                  usually split between the vessel owners and the crewmembers because the owner is undertaking
                  peril as well by putting his property at risk.

Success

         The Annie Lord
              o Facts – Cargo of lumber of the ship. Storm put it in peril. Another vessel came by the next day
                  who had frostbite. The 2nd ship came in and tried to tow it to Boston. The weather was bad and
                  lines were breaking. They decided to leave the Annie Lord because the crew needed medical help.
                  When they got to Boston, the master of the Oliver who was on the AL and calls authorities
                  reporting that they had to leave the ship. A cutter of the US found it and brought it in. The
                  assistance that the Oliver provided neither helped nor hindered the ultimate salvage.
              o Issue – Was there success here?
              o Held – Yes, the Oliver had a proximate cause to the saving of the property.
              o Analysis – The contact from the captain of the AL to the US. The message to the authorities, that
                  was enough for a salvage.
              o Rule – you do not need to bring in the ship alone, just have a causal connection to the
                  ultimate salving of the property. A message can be enough
         Saint Paul Marine Transportation Corp. v. Cerro Sales Corp.
              o Facts – SS North America was abandoned ablaze about 600 miles off Honolulu. The ship had
                  $1.8M in cargo of copper on the vessel. The Coast Guard directs the St. Paul to go to the SSNA to
                  help them. They save 22 lives and allegedly extinguished some fires and tried to tow the vessel. It
                  almost immediately fails. The next day, the CG authorizes it to leave for HI with the people it
                  saved. Meanwhile, the tug salved the vessel and saved the cargo of $1.5M. St. Paul sues the cargo
                  owner. They say they deserve a cut. The defendants say they have abandoned the salvage.
              o Issue – Does success need be complete?
              o Held – P helped save the ship so they have had success of some for salvage. There was a causal
                  relationship here.

Salvage II
Awards

         Margate Shipping Co. v. M/V JA Orgeron
             o Facts – Specialized barge that is carrying NASA stuff that is worth a ton of money. The tug lost
                  it’s engines. It was 100% sure to be lost at sea if not for the actions of the MV Cherry Valley
                  Captain Strong. Cherry Valley had 220,000 gallons of crude. It was a single skinned tanker. The
                  vessel is huge. 8 ½ minutes or about 1 mile to stop. 658 ft. long. Saved the barge and cargo intact



                                                                                                                   36
                notwithstanding the storm. Government cannot fight on the salvage, so argues that the award was
                too high. US appeals 12.5% on ~$50M.
            o Issue – What is the award when there is no market?
            o Held – The court determines that the value is not $51M, but rather $33M.
            o Analysis – Blackwall Factors about the amount of an award
                      1) labor of the salvors
                      2) skill involved,
                      3) value of the property salvors voluntarily put at risk,
                      4) risk to the salvors, and
                      5) value of the salved property,
                      6) Degree of danger.
            o The idea behind about why the value of the of the salved property is the most important is that the
                law should be consistent with the economic value. The risk should justify the benefits.
                      12.5% was in the 6M range. Not bad for a day’s work.
            o Look to:
                      1) Replacement cost, and
                                Was $19M.
                      2) Availability
                                3 years to make. + $12M.
       Trico Marine Operators, Inc. v. Dow Chemical Co.
            o Facts – Vessel towed 3 loaded barges of Benzene and they broke up in the rough seas. 2 tugs from
                P rounded up the barges before as spill or collision occurred. It could have been a substantial
                environmental liability. P sues in salvage against DOW Chemical for an award. The value is not
                high for the Benzene. P argues to consider the amount of liability that DOW averted because of
                P’s actions. Costs to the owner should be included in the value of the property saved.
            o Issue – What should the appropriate awards in a situation where liability is averted?
            o Held – Liability salvage is not permitted.
            o Analysis – 1) 1989 convention about salvage – treaty the US signed. They reject the idea of
                liability salvage here. 2) Lloyds of London or LOF – standard salvage K in the business. It does
                not recognize the idea that avoiding liability should be included in a salvage award.
       Falgout Brothers, Inc. v. S/V Pangaea
            o Facts – Crew of P’s tug found a derelict sailboat and brought it into bay. Salvage gives rise to
                maritime lien. Nobody shows up after the lien was filed. P files motion for default judgment under
                law of finds. The court says that salvage is the proper remedy. Does not permit title, but awards.
            o Issue – what happens under salvage?
            o Held – Crew gets a cut of the 100% sales proceeds.

Disqualification

       Tidewater Salvage, Inc. v. Weyerhaeuser Co.
            o Facts – D operates a logging company in a bay and Tidewater (P) is a professional outfit of
                salvaging. D operates a logger in the water like many others, so companies like P takes logs back.
                D sends unequivocal letters to P that they do not want salvage services.
            o Issue – Can rejection of salvage services be made this way?
            o Held – Salvage cannot generally be forced upon someone, but until P salves the log, he doesn’t
                know whose property it is.
            o Analysis – Instances in which P salves from the beach, salvage can be rejected on them because
                D’s stamp is plainly on them; however, logs in the water they cannot be seen until salvaged. To


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           this court (1) Marine Peril does not mean peril to the salved object, but also to other traffic.
           Refusal must be reasonable.
   Cromwell v. The Island City (Pirate Exception)
       o Facts – 1861 a Libel (complaint in admiralty) for salvage against the Island City. Island City was
           making a voyage and was stuck in s a snowstorm. Other ships tried to help but were unsuccessful.
           Cromwell’s Western Port salved IC. In doing so, the crew went aboard the vessel and plundered it.
           After it was brought to port, the owners filed a libel. The owner of the IC says no you are
           disqualified because you have a duty of faithfulness that was breached. Equitable doctrine because
           the P had unclean hands.
       o Issue – Is the Western Port disqualified?
       o Held – Yes.
       o Analysis -There is an exception if it is one person and not everyone has knowledge. If just one
           person – not disqualified. If one does it w/ knowledge – disqualified. Everyone – disqualified.




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Class 3 (2/1 – 118-154)
Class 4 (2/8 – 155-191) Rules B & C (p. 857) 838 NE2d 949 – 795 F2d 1210
Class 5 (2/15 – 759-806) Seafarers Remedies – Jones Act
Class 6 (2/22 – 807-838) 33 USC 905, Longshore Act
Class 7 (2/29 – 839-856) Wrongful death – Yamaha I, 516 US 199, Yamaha II, 216 F.3d 338, Amtrack, 121 F.3d
1421
Class 8 (3/21) 299-347 Limitation of Liability; Rule F
Class 9 (4/4) 489-513 and 443-476
Class 10 (4/11) Salvage I – 599 (630) -649
Class 11 (4/18) Salvage II – Review

Review

        Fair Game on the Test
              o Nothing from Ch. 1.
              o Ch 2.
              o Ch 3. (in part) 155-204 (Fair), 205-219(not fair)
              o Ch. 4 (nope)
              o Ch. 5
              o Ch 6. Nope
              o Ch 7 nope
              o Ch 8 443-476 (fair) not the rest.
              o Ch 9 all good
              o Ch 10 (no)
              o Ch 11 (no)
              o Ch 12 597-649 (fair game)
              o Ch 13 (no)
              o Ch 14 (no)
              o Ch 15 (all)
        Test
              o 1) Objective analysis , and 2) persuasion (Think about venue?)
                      Fact pattern where the majority will be standard (1)
                      Other parts will be (2) – at least one about persuasiveness
                                Write an argument to the court asserting a legal position.
                                He will tell us the position to take.




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