Ocean Science & Eng., Inc. v. International Geomarine Corp.

• Citation: 312 F. Supp. 825
• Decision Date: 12 May 1970
• Docket Number: Civ. A. No. 3807.
• Parties: OCEAN SCIENCE AND ENGINEERING INC., Plaintiff, v. INTERNATIONAL GEOMARINE CORPORATION, and International Geomarine Corporation (Sudan) Limited, Defendants.
• Court: U.S. District Court — District of Delaware

312 F. Supp. 825

OCEAN SCIENCE AND ENGINEERING INC., Plaintiff, v. INTERNATIONAL GEOMARINE CORPORATION, and International Geomarine Corporation (Sudan) Limited, Defendants.

Civ. A. No. 3807.

United States District Court, D. Delaware.

May 12, 1970.

James M. Tunnell, Jr., and Richard L. Sutton, of Morris, Nichols, Arsht & Tunnell, Wilmington, Del., and Philip A. Ryan and Eugene A. Theroux, of Baker & McKenzie, Washington, D. C., of counsel, for plaintiff.

Michael N. Castle, of Connolly, Bove & Lodge, Wilmington, Del., and Alvin S. Kaufer, of Nossaman, Waters, Scott, Krueger & Riordan, Los Angeles, Cal., of counsel, for defendants.

OPINION

LATCHUM, District Judge.

This action for breach of contract seeks to recover money allegedly due and owing to the plaintiff from defendants for oceanographic survey work performed in the Red Sea by the plaintiff between February and May 1969.

Jurisdiction is alleged to exist under this Court's admiralty and maritime jurisdiction as provided in 28 U.S.C. § 1333(1) because the contract in question is maritime in nature. The defendants have moved (1) to dismiss the action for lack of admiralty jurisdiction and (2) alternatively, if admiralty jurisdiction is found to exist, to transfer the action pursuant to 28 U.S.C. § 1404(a) to the United States District Court for the Central District of California.

I MOTION TO DISMISS

The first question for determination is whether the agreement sued upon here is a maritime contract. If it is, concededly, this Court has admiralty jurisdiction which "extends to all contracts, claims and services essentially maritime." Ex parte Easton, 95 U.S. 68, 72, 24 L.Ed. 373 (1877). In determining whether a particular contract is maritime "the true test is the subject-matter of the contract—the nature and character of the work to be done." State Industrial Commission of New York v. Nordenholt Corp., 259 U.S. 263, 271, 42 S.Ct. 473, 66 L.Ed. 933 (1922); Kossick v. United Fruit Co., 365 U.S. 731, 81 S.Ct. 886, 6 L.Ed.2d 56 (1961).

Turning to the present contract, a pragmatic consideration of what was to be performed, where it was to be performed and how it was to be performed compels the conclusion that the "transaction relates to ships and vessels, masters and mariners, as the agent of commerce on navigable waters," 1 Benedict on Admiralty, 6th Ed. § 64, and is so essentially maritime in character that it is within the admiralty jurisdiction of this Court.

The pervasive maritime quality of the contract is indicated by a review of its salient features. The contract dated November 25, 1968 entered into between the plaintiff and International Geomarine Corporation (Sudan) Limited, ("IGC Sudan"), a Delaware corporation and wholly owned subsidiary of International Geomarine Corporation ("IGC"), also a Delaware corporation, first recited that IGC Sudan held licenses and had the right to prospect for mineral deposits in underwater areas of the Red Sea and desired the plaintiff to assist it in determining the extent and value of such mineral deposits. Then followed the operating provisions of the contract,¹ the relevant portions of which may be summarized as follows:

1. Plaintiff agreed to conduct geophysical surveys, make geological observations and measurements and collect geological samples for the purpose of mapping in detail and determining the geological make-up and mineral composition of the sea bottom sediments and interstitial brines of the designated area in the Red Sea.

2. Acoustic surveys would be conducted with specified makes of acoustical equipment and recorders and "coring" and "temperature telemetering" would be done in a particularly described manner.

3. To accomplish the foregoing, the parties agreed to use a certain vessel, the M/V WANDO RIVER² with a full complement of six crew members and furnished with all equipment and supplies necessary to perform the mission safely, efficiently and effectively.

4. One Donald Matthews would be master of the M/V WANDO RIVER.

5. Navigation was to be accomplished by specific SHORAN equipment, a named "party chief" was designated to head a party of four men to carry out the prescribed work and IGC Sudan was entitled to designate a field representative, with the right to be aboard the vessel, who was authorized to designate the locality, duration and extent of operations.

6. Plaintiff agreed to deliver all maps, charts, reports, data, information, all work products and other materials resulting from the operation to IGC Sudan at end of the mission or sooner if requested by the field representative.

7. Core samples taken were to be returned to the United States aboard the M/V WANDO RIVER.

8. Elaborate provisions were made relating to defendants' payments under the contract. Defendants were to pay a mobilization charge of $150,743 to mobilize the vessel, and all personnel and equipment to Port Sudan, a monthly operating charge during operations and a demobilization charge of $89,101 to return the vessel, personnel and equipment to the United States.

9. Plaintiff was to be in sole charge of the operation and was designated an independent contractor as IGC Sudan was "interested only in the results of the Operation herein contracted for."

10. IGC Sudan had the right to suspend operation or to terminate the period of operation under the contract by giving written notice. The contract was also to "terminate at the time of the destruction of the vessel."

11. The agreement also provided the interpretation and application of its terms would be governed exclusively by the laws of the State of California.

A mere recital of the above provisions clearly indicates that the performance of the contract contemplated a ship voyage from the United States to the Red Sea where geological surveys would be conducted underwater using a particular oceangoing, properly manned, and equipped vessel. The agreement, so closely related to undersea work to be performed from a vessel, is essentially maritime in character and cannot be classified as a land contract by fine spun distinctions.

While conceding that the contract has maritime features, the defendants argue that they are incidental to the dominant purpose of the agreement, viz. to obtain scientific data and detailed geological maps from plaintiff as an independent contractor. Thus, they emphasize the language of the contract, providing that defendants were "interested only in the results of the Operation * * * contracted for", as determinative of its non-maritime nature. The Court is unable to agree with this contention. A realistic examination of the contract in question plainly reveals that its ultimate object is so inseparably related to the manner and place of performance by an ocean-going vessel and crew operating at sea in making an underwater survey that it cannot be deemed to be a land contract outside the maritime and admiralty jurisdiction of this Court. It is essentially one of those contracts with a "genuinely salty flavor" of maritime law of which Mr. Justice Harlan spoke in Kossick, supra at 742, 81 S.Ct. 886.

An agreement to perform work similar to that required by the present agreement has been viewed as a maritime contract. In Pure Oil Company v. Geotechnical Corporation of Delaware, 129 F.Supp. 194, 196 (E.D.La.1955), a contract to perform geophysical work from a vessel in the Gulf of Mexico was considered a maritime contract requiring the application of maritime law. The contract in that case had been described in an earlier appeal, Geotechnical Corporation of Delaware v. Pure Oil Company, 196 F.2d 199, 200, 201 (5th Cir. 1952) as one calling for "seismographic work over water" by a vessel operated by an independent contractor and engaged in "seismographic blasting operations in search of oil deposits off the coast of Louisiana in the Gulf of Mexico." In that case, like this one, the operations were being conducted by an independent contractor through its own employees in order to secure the desired result.

Further, defendants' argument proves too much. If the ultimate object of an agreement were the sole factor determining whether a contract was maritime, then a contract of affreightment to deliver goods by ship to a dry land destination would be a non-maritime contract. But such contracts have long been considered within admiralty jurisdiction since they are contracts for maritime services to be performed upon the sea. New Jersey Steam Navigation Company v. Merchants' Bank, 47 U.S. 344, 391, 6 Haw. 344, 12 L.Ed. 465 (1848). The contract in question is not much different, in this sense, from a contract of affreightment; it calls for a maritime service to be performed by a vessel making an oceanographic survey of the bottom of the Red Sea. That the maritime service rendered under the present contract may be a new development, unknown in the past, is no reason to hold that it is outside of this Court's maritime jurisdiction. Romero v. International Terminal Operating Co., 358 U. S. 354, 360, 79 S.Ct. 468, 474, 3 L.Ed.2d 368 (1958) recognized the organic growth and evolving nature of maritime law and jurisdiction by pointing out that Article III, § 2, Cl. 1 (3d provision) of the United States Constitution "empowered the federal courts in their exercise of the admiralty and maritime jurisdiction * * * to continue the development of this law within constitutional limits." Whether a contract is maritime is not a static concept; it depends, as always, upon the nature of the contract and the service to be rendered and performed and its manner of performance.

Finally, in attempting to establish the non-maritime nature of the contract, defendants stressed that the agreement was to be governed "exclusively by its terms and by the laws of California." Thus, defendants contend that this provision indicated the parties'...