Am. S.S. Co. v. Hallett Dock Co.

• Decision Date: 23 March 2012
• Docket Number: Civil No. 09–2628 (MJD/LIB).
• Citation: 862 F.Supp.2d 919
• Court: U.S. District Court — District of Minnesota
• Parties: AMERICAN STEAMSHIP CO., Armstrong Steamship Co., Plaintiffs, v. HALLETT DOCK CO., Fraser Shipyards, Inc., RJS Construction LLC, Chris Jensen & Son, Inc., Reuben Johnson & Son, Inc., Defendants.

862 F.Supp.2d 919

AMERICAN STEAMSHIP CO., Armstrong Steamship Co., Plaintiffs,

v.HALLETT DOCK CO., Fraser Shipyards, Inc., RJS Construction LLC, Chris Jensen & Son, Inc., Reuben Johnson & Son, Inc., Defendants.

Civil No. 09–2628 (MJD/LIB).

United States District Court,

D. Minnesota.

March 23, 2012.

Gerardo Alcazar, Brent L. Reichert, David E. Bland, and Richard B. Allyn, Robins, Kaplan, Miller & Ciresi L.L.P., Counsel for Plaintiffs.

David R. Hornig and Guerric S.H.L. Russell, Nicoletti Hornig & Sweeney, and John D. Kelly and Scott A. Witty, Hanft Fride, P.A., Counsel for Defendant Hallett Dock Co.

Nicholas Ostapenko and Paul W. Wojciak, Johnson Killen & Seiler, and Edward C. Radzik and Lauran V. Marshall, Dennehey, Warner, Coleman & Goggin, Counsel for Defendant Fraser Shipyards, Inc.

Daniel A. Haws, John Paul J. Gatto, and Krista J. Robertson, Murnane Brandt, PA, Counsel for RJS Construction, LLC, Chris Jensen & Son, Co., Inc., and Reuben Johnson & Son, Inc.

Memorandum of Law & Order

MICHAEL J. DAVIS, Chief Judge.

I. Summary of Decision

This case involves claims by the owners of the Walter J. McCarthy, Jr., a one thousand foot freight ship which was damaged when it struck debris as it attempted to berth at a Superior, Wisconsin dock on January 14, 2008. The accident opened a large gash in the McCarthy's hull and is alleged to have caused more than four million dollars in damage. The McCarthy's owners brought suit against the various defendants named above, all of whom are alleged to have played a role in the accident. This case proceeded through discovery, with each party having an opportunity to depose the individuals involved in the accident and to collect other relevant evidence. As might be expected, the record reveals divergent accounts of the day of the accident and the time leading up to it. Conflicting testimony abounds. Each party has attempted to push to the blame away from itself and toward others.

The parties have now filed a series of motions, asking the Court to grant summary judgment in their favor on questions of liability and various other legal issues. The general rule of the federal maritime law that governs this case provides that all parties responsible for the accident shall be liable for the damages. Damages are apportioned among the responsible parties according to their relative contribution to the accident.

This Court cannot grant summary judgment where material factual disputes persist; fact issues are for a jury at trial. Because of the numerous factual disputes that remain in this case, the Court cannot determine at this stage the total amount of damages caused by the accident, which parties are liable for the damages, or to what extent the each of the responsible parties contributed to the accident.

Although the Court concludes that the majority of the issues raised by the parties must be resolved by a jury, the Court has granted summary judgment on a few limited issues. The Pennsylvania Rule is maritime rule which comes into play when a party involved in an accident has violated certain maritime statutes and regulations. The Court concludes that the undisputed evidence shows that Hallett Dock Co., the owner of the dock at which the McCarthy was damaged, violated one or more maritime rules when it created and failed to mark debris in the slip where the McCarthy was to be berthed. The burden at trial will therefore fall on Hallett to prove that its negligence did not contribute to the accident.

The Court also concludes that certain warranty claims advanced by the McCarthy's owners are not supported by the law or the evidence developed in discovery. Such claims need not proceed to a jury and will be dismissed.

II. Introduction

This matter is before the Court on: (1) a motion for partial summary judgment by Plaintiffs American Steamship Company and Armstrong Steamship Company (collectively, “ASC”) against all Defendants on the issue of damages [Docket No. 164]; (2) a motion for partial summary judgment by ASC against Defendant Hallett Dock Company (“Hallett”) [Docket No. 160]; (3) a motion for partial summary judgment by Hallett [Docket No. 168]; (4) a motion for summary judgment by Defendant Fraser Shipyards, Inc. [Docket No. 173]; (5) a motion for partial summary judgment by Defendant Chris Jensen & Son, Inc. [Docket No. 156]; and (6) a motion for partial summary judgment by Defendants RJS Construction LLC and Reuben Johnson & Son, Inc. [Docket No. 151]. ASC and Hallet have also moved to supplement the record [Docket Nos. 266, 276, 311], and ASC has moved to strike Hallett's motion [Docket No. 286]. The Court heard oral argument on Friday, October 28, 2011.

III. Background

This case arises out of an accident involving the Walter J. McCarthy, Jr. (“McCarthy”), a one thousand foot freight ship owned and operated by ASC. On January 14, 2008, the McCarthy struck underwater debris as it was entering a slip at a Superior, Wisconsin dock owned by Hallett.The collision ¹ caused a seven by four foot gash in the hull, grounding the ship and allowing water to enter the hull and engine room. The flooding caused extensive damage.

A. Hallett Dock Number 8

The McCarthy accident occurred at Hallett Dock Number 8 (“Dock No. 8”), a commercial dock and commodity storage site on the south shore of the Duluth/Superior Harbor. Dock No. 8 runs north from the shore alongside a slip which is 2,200–2,300 feet long and 151 feet wide. Dock No. 8 is used primarily to load and unload bulk commodities.

In October 2006, a 180 foot section of the dock wall collapsed into the slip. The collapsed area began approximately 330 to 250 feet north of the southern end of the slip and ended approximately 510 to 540 feet north of the south end of the slip. A concrete and rebar mooring house measuring 10 by 10 by 12 feet fell into the slip near the north end of the collapsed section.

In the spring of 2007 Hallett hired Marine Tech, LLC to replace the collapsed dock section and to clean up debris that fell into the slip. Marine Tech reconstructed the dock, installing a new dock wall, pilings, and six new yellow mooring bollards, which are used to tie up ships at the dock. This work was completed in the summer of 2007. Marine Tech also dredged some portion of the slip where the dock collapsed, but it did not remove all of the debris before the winter. In October or November 2007, Marine Tech conducted soundings of the slip to determine the depth of the slip at five foot intervals. The soundings revealed an area several feet shallower than surrounding areas. (First Alcazar Decl. [Docket No. 163], Ex. 12.) All areas north of the first new yellow bollard appear to have been clear and unobstructed during the winter of 2007–2008.

While Hallett had marked the area containing the debris using buoys, it is undisputed that the buoys were removed before the winter and there were no physical warnings of debris in or around the slip as of January 2008.

B. Negotiations to Dock the McCarthy at Dock No. 8

ASC marine superintendent Ken Gliwa visited Dock No. 8 in September 2007 to assess whether it would be suitable for the McCarthy's “winter layup”—a time when the ship is docked to perform maintenance and to avoid extreme winter conditions. That month, Gliwa sent a letter to Hallett reserving the dock, and Hallett agreed to “provide mooring for [the McCarthy] during the winter layup period.” (First Alcazar Decl., Ex. 7.) ASC contends that this agreement called for Hallett to assist with the mooring by providing guiding, spotting, and tie-up services. Hallett denies that it agreed to provide such services, asserting that it agreed only to allow ASC to moor the McCarthy at Dock No. 8. In exchange for mooring the ship at Dock No. 8, ASC agreed to pay for a new electrical service at the dock. (First Alcazar Decl., Ex. 9.)

ASC entered into a separate agreement with Defendant Fraser Shipyard Shipyards, Inc. (“Fraser”), under which Fraser would repair the McCarthy over the winter and also “provide line and anchor handling” upon the McCarthy's arrival for winter layup. (Radzik Decl. [Docket No. 177], Ex. 8.)

C. December 6 Phone Call

ASC alleges that Al Desmond, the McCarthy's Chief Engineer, had a telephone conversation with Hallett President Mike McCoshen on December 6, 2007, and during that conversation McCoshen told Desmond that the debris in the slip had been cleaned up and that the slip was at least 21 feet deep up to 1,800 feet back from the opening of the slip. (Desmond Dep., First Alcazar Decl., Ex. 14 at 314:9–13.) Desmond typed notes to that effect. (First Alcazar Decl., Ex. 13.) McCoshen states that he does not recall such a conversation and denies that he would have given the information alleged by Desmond because that information would have been “incomplete or erroneous.” (McCoshen Aff., Hornig Aff. [Docket No. 226], Ex. A, ¶¶ 8–9, 15–16.)

D. The January 10 Meeting

A pre-arrival meeting was held at Dock No. 8 on January 10, 2008 (“the January 10 meeting”). Present at that meeting were Gliwa, McCoshen, and Mike Podgorak. Podgorak is a truck supervisor employed by Defendant Chris Jenson & Son (CJS). Podgorak has testified that he attended the meeting in place of Dave Whitehead, a Fraser employee, and also to represent Defendant Reuben Johnson, which had been asked to provide snow removal services at the dock. (Podgorak Dep., Fourth Alcazar Decl. [Docket No. 224], Ex. 11 at 92:5–9, 112:1–17.) Gliwa has asserted that he believed Podgorak to be a Fraser employee who was also at the meeting to represent Reuben Johnson and Defendant RJS Construction LLC. (Gliwa Aff., Fourth Alcazar Decl., Ex. 8, ¶ 3.)

While the parties present at the meeting have differing recollections, all agree that McCoshen stated that the McCarthy should be docked north of the first yellow bollard. They disagree about the extent to which McCoshen explained that there was debris in the slip past that point or warned that the debris posed a danger.

According...