Crown Bay Marina, L.P. v. Reef Transp., LLC

• Decision Date: 16 October 2020
• Docket Number: Civil No. 2018-73
• Parties: CROWN BAY MARINA, L.P., Plaintiff, v. REEF TRANSPORTATION, LLC, et al., Defendants.
• Court: U.S. District Court — Virgin Islands

CROWN BAY MARINA, L.P., Plaintiff, v. REEF TRANSPORTATION, LLC, et al., Defendants.

Civil No. 2018-73

DISTRICT COURT OF THE VIRGIN ISLANDS DIVISION OF ST. THOMAS AND ST. JOHN

October 16, 2020

MEMORANDUM OPINION AND ORDER

Before the Court is defendant Reef Transportation, LLC's ("Reef") "Motion for Summary Judgment" [ECF 131]. Plaintiff Crown Bay Marina, L.P. ("CBM") filed an opposition and cross motion for summary judgment [ECF 182]¹ and Reef replied [ECF 205]. Reef also filed an opposition to the cross motion for summary judgment. [ECF 224].

I. STATEMENT OF FACTS

Plaintiff CBM is a Delaware Limited Partnership and the owner of Crown Bay Marina ("the Marina"), a boat docking facility located on St. Thomas in the U. S. Virgin Islands. Ver. Compl. [ECF 1] ¶ ¶ 3, 4. Kosei Ohno is President of the St. Thomas Marina Corporation, CBM's sole general partner. Ohno Dep. [ECF 133-2] at 12.² CBM acquired the Marina in approximately1998. Id. at 13. From 1998 until October 27, 2017, Dennis Kissman and his company, Marina Management Services, Inc., managed the Marina. Id. at 11. During that time, Kissman was a limited partner in CBM. Id. at 13-14.

Defendant Reef is a limited liability company authorized to do business in the U. S. Virgin Islands and owner of the vessels Morning Star and Evening Star. Ver. Compl. [ECF 1] ¶ 5; Trilling Decl. [ECF 133-1] ¶ 3. Both vessels are 27-foot single screw harbor vessels used as water taxis. Id. Reef has two members—Scott McKellar and James Trilling. Id. ¶ 2.

On September 5, 2017, in anticipation of Hurricane Irma making landfall on St. Thomas, Reef employees Captain Chris Matthews, Captain Robert "Red" Ritter, and Captain Dave MacVean secured both Reef vessels in slips C-10 and C-12 at the Marina.³ Ver. Compl. [ECF 1] ¶¶ 11, 12; [ECF 133-1] ¶ 4; [ECF 159] at 9. Reef co-owner Trilling inspected the vessels after they were secured and approved the tie up procedures the Reef captains used. Trilling Decl. [ECF 133-1] ¶ 6. Gerard Ocello, CBM's dockmaster at the time, also observed the way both Reef vessels were tied up prior to the storm. Ocello Dep. [ECF 133-12] at 3-5. The next day, September 6, 2017, Hurricane Irma passed over St. Thomas. Ver. Compl. [ECF 1] ¶ 10. Following the storm, both Reef vessels remained tied to the C Dock. Trilling Decl. [ECF 133-1] ¶ 6; van der Heide Dep. [ECF 195-1] at 170-71.

CBM filed the instant action on September 5, 2018. CBM alleges Reef was negligent in securing its vessels to the C Dock. Ver. Compl. [ECF 1] ¶¶ 11, 12. CBM also contends that the Reef vessels caused significant damage to the concrete finger piers, pilings, wooden whalers, cleatsand other equipment. Id. ¶ 13. CBM seeks $311,566 to repair and restore the Marina, as well as other amounts. Id. ¶ 14.

II. LEGAL STANDARDS

A. Summary Judgment

Summary judgment is appropriate where an examination of the pleadings, affidavits, and other proper discovery materials before the court demonstrates "there is no genuine dispute as to any material fact," thus entitling the moving party to judgment as a matter of law. Fed. R. Civ. P. 56(a); see Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986). A fact is "material" if proof of its existence or non-existence might affect the outcome of the litigation. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986) (explaining that "irrelevant or unnecessary" factual disputes do not preclude summary judgment). A factual dispute is "genuine" if "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. "In considering a motion for summary judgment, a [] court may not make credibility determinations or engage in any weighing of the evidence; instead, the nonmoving party's evidence 'is to be believed and all justifiable inferences are to be drawn in his favor.'" N.H. Ins. Co. v. Diller, 678 F. Supp. 2d 288, 295 (D.N.J. 2009) (quoting Marino v. Indus. Crating Co., 358 F.3d 241, 247 (3d Cir. 2004)).

The movant has the initial burden of showing no genuine issue of material fact exists. Gans v. Mundy, 762 F.2d 338, 342 (3d Cir. 1985). Once the moving party meets this burden, the nonmoving party must identify, by affidavits or otherwise, specific facts showing there is a genuine issue for trial. Celotex Corp., 477 U.S. at 323; see Quiroga v. Hasbro, Inc., 934 F.2d 497, 500 (3d Cir. 1991) (stating that the non-moving party "may not rest upon mere allegations, general denials, or . . . vague statements"); Berckeley Inv. Grp., Ltd. v. Colkitt, 455 F.3d 195, 201 (3d Cir. 2006) ("[S]ummary judgment is essentially 'put up or shut up' time for the nonmoving party: the non- moving party must rebut the motion with facts in the record and cannot rest solely on assertions made in the pleadings, legal memoranda, or oral argument.").

B. Maritime Law

District courts of the United States "have original jurisdiction . . . of [a]ny civil case of . . . maritime jurisdiction." 28 U.S.C. § 1333(1).⁴ "The fundamental interest giving rise to maritime jurisdiction is the protection of maritime commerce." Hargus v. Ferocious & Impetuous, LLC, 840 F.3d 133, 136 (3d Cir. 2016) (quotation marks omitted). Whether admiralty jurisdiction exists is a matter of substantive federal admiralty law. Interested Underwriters at Lloyd's v. Haulover Marine, Inc., 866 F. Supp. 235, 236-37 (D.V.I. 1994).

1. Maritime Tort Claims

"For a federal court to have admiralty jurisdiction over a tort claim, the tort must (1) occur on navigable waters and (2) bear some relationship to traditional maritime activity." Andreu v. Palmas del Mar Homeowners Ass'n, Inc., 311 F. Supp. 3d 456, 459 (D.P.R. 2018) (citing Jerome B. Grubart, Inc. v. Great Lakes Dredge & Dock Co., 513 U.S. 527, 534 (1995)). Navigable waters are those which, on their own or in conjunction with others, form "a continued highway over which commerce is or may be carried on with other States or foreign countries in the customary modes in which such commerce is conducted by water." Andreu, 311 F. Supp. 3d at 459-60 (quoting The Daniel Ball, 77 U.S. 557, 563 (1870)). Torts bear a relationship to traditional maritime activity if the incident could potentially disrupt maritime commerce and if "the general character of the activity giving rise to the incident shows a substantial relationship to traditional maritime activity." Andreu, 311 F. Supp. 3d at 460-61 (quoting Grubart, 513 U.S. at 534).

Finally,

a plaintiff asserting a maritime negligence cause of action must show (1) the existence of a duty required by law which obliges the person to conform to a certain standard of conduct; (2) a breach of that duty by engaging in conduct that falls below the applicable standard or norm; (3) a resulting loss or injury to the plaintiff; and (4) a reasonably close causal connection between the offending conduct and the resulting injury. Id. (alterations omitted) (quoting 1 Thomas J. Schoenbaum, Admiralty and Maritime Law, §§ 5-2, at 252 (5th ed. 2011)).

Pogan v. M/V/ Venture Pride, 2018 WL 1548687, at *2 (D.V.I. Mar. 28, 2018) (quotation marks omitted). Thus, the elements of a negligence claim in admiralty law are "essentially coextensive with its common law counterpart." Id. (quoting In re Frescati Shipping Co., 718 F.3d 194, 207 (3d Cir. 2013)). In other words, "[u]nder the general principles of negligence, mariners are expected to exercise human skill and precaution, and a proper display of nautical skill, i.e., reasonable care under the circumstances." Pogan, 2018 WL 1548687, at *2 (quotation marks omitted).

2. Maritime Contract Claims

Where the court has admiralty jurisdiction over a contract claim, the court must apply federal choice of law rules to determine the applicable law. Calhoun v. Yamaha Motor Corp., U.S.A., 216 F.3d 338, 343 (3d Cir. 2000); accord State Trading Corp. of India v. Assuranceforeningen Skuld, 921 F.2d 409, 414 (2d Cir. 1990) ("A federal court sitting in admiralty must apply federal choice of law rules."). "[C]ourts apply federal choice-of-law rules by 'ascertaining and valuing points of contact between the transaction and the states or governments where competing laws are involved.'" Travelers Prop. Cas. Co. of Am. v. Ocean Reef Charters LLC, 324 F. Supp. 3d 366, 383-84 (W.D.N.Y. 2018) (quoting Lauritzen v. Larsen, 345 U.S. 571, 582 (1953)). Those points of contact are "(1) any choice of law provision contained in the contract; (2) the place where the contract was negotiated, issued, and signed; (3) the place of performance; (4) the location of the subject matter of the contract; and (5) the domicile, residence, nationality, place of incorporation, and place of business of the parties." Advani Enters., Inc. v. Underwriters at Lloyds, 140 F.3d 157, 162 (2d Cir. 1998).⁵

"[W]hen a maritime contract contains a choice-of-law clause, the law chosen by the parties governs . . . unless (1) that jurisdiction has no substantial relationship to the parties or the transaction or (2) that jurisdiction's law conflicts with the fundamental purposes of maritime law . . . ." Farrell Lines Inc. v. Columbus Cello-Poly Corp., 32 F. Supp. 2d 118, 127 (S.D.N.Y. 1997) (citations and quotation marks omitted). In other words, "[t]he fact that a choice-of-laws provision exists in a contract does not, by itself, remove the contract from the scope of maritime law." Williamson v. Recovery Ltd. P'ship, 542 F.3d 43, 49 (2d Cir. 2008). Rather, "once a contract has been deemed a maritime contract, the next step is determining whether a specific state's laws should be used to supplement any area of contract law for which federal common law does not provide." Id. (emphasis in original).

Here, CBM contends that it is suing Reef for breach of contract for failing to "indemnify and reimburse CBM for damages," and for breaching a "duty to name Crown Bay Marina as an additional assured." [ECF 182] at 2, 15-19. Paragraph 17 of the License Agreement provides that the agreement "shall be governed by, construed and enforced in accordance with the...