497 U.S. 358 (1990), 88-2041, Sisson v. Ruby

Docket Nº:No. 88-2041
Citation:497 U.S. 358, 110 S.Ct. 2892, 111 L.Ed.2d 292, 58 U.S.L.W. 4941
Party Name:Sisson v. Ruby
Case Date:June 25, 1990
Court:United States Supreme Court
 
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Page 358

497 U.S. 358 (1990)

110 S.Ct. 2892, 111 L.Ed.2d 292, 58 U.S.L.W. 4941

Sisson

v.

Ruby

No. 88-2041

United States Supreme Court

June 25, 1990

Argued April 23, 1990

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR

THE SEVENTH CIRCUIT

Syllabus

A fire erupted in the washer/dryer area of petitioner Sisson's pleasure yacht while it was docked at a Lake Michigan marina, destroying the yacht and damaging several neighboring vessels and the marina. Respondents filed claims against Sisson for over $275,000 in damages. Invoking a Limited Liability Act provision that limits a vessel owner's liability for any damage done without the owner's privity or knowledge to the value of the vessel and its freight, Sisson filed a petition for declaratory and injunctive relief in the Federal District Court to limit his liability to $800, his yacht's salvage value after the fire. The court dismissed the petition for lack of subject-matter jurisdiction, rejecting Sisson's argument that it had, inter alia, jurisdiction under 28 U.S.C. § 1333(1), which grants district courts maritime jurisdiction. The Court of Appeals affirmed.

Held: The District Court has jurisdiction over Sisson's limitation claim pursuant to § 1333(1). Maritime jurisdiction is appropriate when a potential hazard to maritime commerce arises out of an activity that bears a substantial relationship to traditional maritime activity. Foremost Ins. Co. v. Richardson, 457 U.S. 668, 675, n. 5. The first half of the test -- that there be a potential hazard to maritime activity -- is met because the fire, which began on a noncommercial vessel at a marina on a navigable waterway, could have spread to nearby commercial vessels or made the marina inaccessible to such vessels. Respondents' argument that the potential effect on maritime commerce was minimal because no commercial vessels were docked in the marina misunderstands the nature of the inquiry, which determines an activity's potential impact by examining its general character, not the actual effects on maritime commerce nor the particular facts about the incident that may have rendered it more or less likely to disrupt commercial activity. See Executive Jet Aviation v. City of Cleveland, 409 U.S. 249, Foremost, supra. In determining, as to the second half of the test, whether there is a substantial relationship between the activity giving rise to the incident and traditional maritime activity, the relevant activity in this [110 S.Ct. 2894] case was the storage and maintenance of a vessel at a marina on navigable waters. A vessel's storage and maintenance is substantially related to a traditional maritime activity. Respondents' contention that navigation is the sole instance, rather

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than an example, of an activity substantially related to traditional maritime activity is incorrect. Were navigation the only activity, Foremost could have stated the jurisdictional test much more clearly and economically. Moreover, a narrow focus on navigation would not serve the federal policies underlying the jurisdictional test, since the need for uniform rules of maritime conduct and liability is not limited to navigation, but extends at least to any other activities traditionally undertaken by commercial or noncommercial vessels. Pp. 360-367.

867 F.2d 341, reversed and remanded.

MARSHALL, J., delivered the opinion of the Court, in which REHNQUIST, C.J., and BRENNAN, BLACKMUN, STEVENS, O'CONNOR, and KENNEDY, JJ., joined. SCALIA, J., filed an opinion concurring in the judgment, in which WHITE, J., joined, post, p. 368.

MARSHALL, J., lead opinion

Justice MARSHALL delivered the opinion of the Court.

We must decide whether 28 U.S.C. § 1333(1), which grants federal district courts jurisdiction over "[a]ny civil case of admiralty or maritime jurisdiction," confers federal jurisdiction over petitioner's limitation of liability suit brought in connection with a fire on his vessel. We hold that it does.1

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Everett Sisson was the owner of the Ultorian, a 56-foot pleasure yacht. On September 24, 1985, while the Ultorian was docked at a marina on Lake Michigan, a navigable waterway, a fire erupted in the area of the vessel's washer/dryer unit. The fire destroyed the Ultorian and damaged several neighboring vessels and the marina. In the wake of the fire, respondents filed claims against Sisson for over $275,000 for damages to the marina and the other vessels. Invoking the provision of the Limited Liability Act that limits the liability of an owner of a vessel for any damage done "without the privity or knowledge of such owner" to the value of the vessel and its freight, 46 U.S.C. § 183(a) (1982 ed.), Sisson filed a petition for declaratory and injunctive relief in federal District Court to limit his liability to $800, the salvage value of the Ultorian after the fire. Sisson argued that the federal court had maritime jurisdiction over his limitation of liability action pursuant to § 1333(1). The District Court disagreed, dismissing the petition for lack of subject-matter jurisdiction. In re Complaint of Sisson, 663 F.Supp. 858 (ND Ill.1987). Sisson sought reconsideration on the ground that the Limited Liability Act independently conferred jurisdiction over the action. The District Court denied Sisson's motion, both on the merits and on the basis of Sisson's failure to raise the argument before the dismissal of the action. In re Complaint of Sisson, 668 F.Supp. 1196 (ND Ill.1987). The Court of Appeals for the Seventh Circuit affirmed, holding that neither § 1333(1) nor the Limited Liability Act conferred jurisdiction. In re Complaint of Sisson, 867 F.2d 341 (1989). We granted certiorari, 493 U.S. 1055 [110 S.Ct. 2895] (1990), and now reverse.

Until recently, § 1333(1) jurisdiction over tort actions was determined largely by the application of a "locality" test. As this Court stated the test in The Plymouth, 3 Wall. 20,

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36 (1866):

Every species of tort, however occurring, and whether on board a vessel or not, if upon the high seas or navigable waters, is of admiralty cognizance.

See also Executive Jet Aviation, Inc. v. City of Cleveland, 409 U.S. 249, 253-254 (1972) (describing the locality test). Executive Jet marked this Court's first clear departure from the strict locality test. There, a jet aircraft struck a flock of sea gulls while taking off, lost power, and crashed into the navigable waters of Lake Erie, which lay just past the end of the runway. The owner of the aircraft sued the city of Cleveland, the owner of the airport, in federal court, arguing that § 1333(1) conferred federal jurisdiction over the action. Noting "serious difficulties with the locality test," id. at 255, we refused to enter into a debate over whether the tort occurred where the plane had crashed and been destroyed (the navigable waters of Lake Erie) or where it had struck the sea gulls (over land), id. at 266-267. Rather, we held that jurisdiction was lacking because "the wrong [did not] bear a significant relationship to traditional maritime activity." Id. at 268.

Although our holding in Executive Jet was limited by its terms to cases involving aviation torts, that case's

thorough discussion of the theoretical and practical problems inherent in broadly applying the traditional locality rule . . . prompted several courts and commentators to construe Executive Jet as applying to determinations of federal admiralty jurisdiction outside the context of aviation torts.

Foremost Ins. Co. v. Richardson, 457 U.S. 668, 673 (1982). In Foremost, we approved this broader interpretation of Executive Jet. 457 U.S. at 673. Foremost involved a collision, on what we assumed to be navigable waters, id. at 670, n. 2, between an 18-foot pleasure boat and a 16-foot recreational fishing boat, see Richardson v. Foremost Ins. Co., 470 F.Supp. 699, 700 (MD La.1979). Neither vessel had ever been engaged in any commercial maritime activity. 457 U.S. 670-671.

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We began our application of Executive Jet by rejecting "petitioners' argument that a substantial relationship with commercial maritime activity is necessary" to a finding of maritime jurisdiction. 457 U.S. at 674 (emphasis added). Although we recognized that protecting commercial shipping is at the heart of admiralty jurisdiction, we also noted that that interest

cannot be adequately served if admiralty jurisdiction is restricted to those individuals actually engaged in commercial maritime activity. This interest can be fully vindicated only if all operators of vessels on navigable waters are subject to uniform rules of conduct. The failure to recognize the breadth of this federal interest ignores the potential effect of noncommercial maritime activity on maritime commerce. . . . The potential disruptive impact of a collision between boats on navigable waters, when coupled with the traditional concern that admiralty law holds for navigation, compels the conclusion that this collision between two pleasure boats on navigable waters had a significant relationship with maritime commerce.

Id. at 674-675 (footnote omitted).

In a footnote to the above passage, we noted that "[n]ot every accident in navigable waters that might disrupt maritime commerce will support federal admiralty jurisdiction," id. at 675, n. 5 (citing Executive Jet), but that, when a

potential hazard to maritime commerce arises out of activity that bears a substantial relationship [110 S.Ct. 2896] to traditional maritime activity, as does the navigation of boats in this case, admiralty jurisdiction is appropriate.

457 U.S. at 675, n. 5.

This case involves a fire that began on a noncommercial vessel at a marina located on a navigable waterway. Certainly, such a fire has a potentially disruptive impact on maritime...

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