DeForge Mar. Towing, LLC v. Alaska Logistics, LLC
| Decision Date | 07 March 2022 |
| Docket Number | C20-1085JLR |
| Court | U.S. District Court — Western District of Washington |
| Parties | DEFORGE MARITIME TOWING, LLC, et al., Plaintiffs, v. ALASKA LOGISTICS, LLC, et al., Defendants. |
Before the court are: (1) Defendant Alaska Logistics, LLC (“AL”) and Allyn G. Long's (collectively “Defendants”) motion for partial summary judgment (Defs. MSJ (Dkt. # 27); Defs. Reply (Dkt. # 38)); and (2) Plaintiffs DeForge Maritime Towing, LLC (“DMT”) and Double EMC Marine, LLC's (“Double EMC”)[1] motion for partial summary judgment . Each party opposes the other's motion. The court has considered the motions, the parties' submissions in support of and in opposition to the motions, the relevant portions of the record, and the applicable law. Being fully advised, [2]the court DENIES DMT's motion for partial summary judgment and GRANTS in part and DENIES in part Defendants' motion for partial summary judgment.
This admiralty action arises out of a contract dispute between DMT and AL regarding the parties' 2018 and 2019 “Time Charter Agreements” (collectively, the “Time Charter Agreements” or the “Agreements”). [3]) DMT is a tug and barge company that provides services in the western United States, including carriage, transportation, chartering, and vessel transport. (See DeForge Decl. ¶ 2.) AL is a marine transportation company that provides services in Western Alaska and the Arctic.
In 2018, DMT and AL began discussing the possibility of AL chartering tugs and barges from DMT for use in AL's Alaska transport operations. (See DeForge Decl. ¶ 3.) AL and DMT ultimately entered into a time charter agreement (the “2018 Time Charter Agreement”) for the charter of the barge THELMA 302 (the “THELMA”)[4] and two DMT tugs (collectively, the “vessels”) on May 9, 2018. (See 2018 Time Charter Agreement; DeForge Decl. ¶ 5; see also Long Dep. at 11:10-17 ().)
The 2018 Time Charter Agreement described the vessels to be chartered, the on-hire and off-hire dates for the vessels, and the price terms. (See, e.g., 2018 Time Charter Agreement ¶ 1.1.) In addition, the agreement provided that, “subject to [AL]'s general direction, [DMT] shall have exclusive control and command of the Vessels' operation and navigation, ” while AL would be in control of loading and unloading cargo and similar operations. The parties also agreed that the agreement would be governed “first by the General Maritime Law of the United States and second by the laws of the State of Washington, insofar as applicable.” (See Id. ¶ 12.4.)
Under the terms of the 2018 Time Charter Agreement, AL, with the permission of DMT, was permitted to install additional equipment on and make alterations to the chartered vessels. (Id. ¶ 3.1.) The agreement provided, however, that “[t]he On-Hire Period for each Vessel shall not end until [AL], at its sole cost and expense, removes all such equipment, materials and gear, and restores each Vessel to its condition prior to making such changes, ordinary wear and tear excepted.” (Id.) The agreement also addressed redelivery of the vessels and defined the end of the charter period, stating that “[t]he Vessels shall be redelivered to [DMT] upon termination of the On-Hire Periods applicable thereto at [DMT's] home port in Seattle, Washington, or other such other location as agreed between the parties, in the same order and condition, ordinary wear and tear excepted, as when accepted by [AL].” (Id. art. 5.)
The 2018 Time Charter Agreement also imposed specific duties and liabilities on AL regarding its handling of the chartered vessels. For example, DMT and AL agreed to the following:
(Id. ¶¶ 2.7, 2.9.) The parties also executed an addendum to the 2018 Time Charter
Agreement, which transferred liability for damage to the THELMA as a result of the condition of the berth or loading or unloading cargo to AL:
The parties also agreed to a system for determining the condition of the chartered vessels at the time of “on-hire” and “off-hire.” (Id. ¶ 4.1.) The agreement called for an agreed-upon qualified surveyor to conduct an on-hire survey prior to the charter period, as well as an off-hire survey, which is “an equivalent survey by the same surveyor, ” at the termination of the charter hire. (Id.) The agreement further provided that the on-hire survey “shall be conclusive evidence of the condition of the Vessel as of the date of commencement of the period of hire” and the off-hire survey “shall likewise be conclusive evidence of the condition of the Vessel as of the termination of the applicable On-Hire Period.” (Id.)
The parties' relevant liability and indemnity obligations were set forth in paragraphs 8.1 through 8.4 of the 2018 Time Charter Agreement.[6] Regarding loss or damage to DMT's property, including the THELMA, paragraph 8.1 provided as follows:
8.1 [DMT] shall defend, protect, indemnify, and hold harmless [AL] from and against any loss, cost, claim, obligation to indemnify another, suit, judgment, award, or damage (including reasonable attorneys' fees), including, but not limited to, wreck removal, on account of loss or damage to any of the Vessels, [DMT's] equipment and vessels, either owned, rented and operated by [DMT] or its agents, subcontractors, and invitees, arising out of or relating to the performance of the work or services under this Charter, whether caused or brought about by [AL's] negligence or any other theory of legal liability, including strict liability or the unseaworthiness of any vessel.
(Id. ¶ 8.1.) Similarly, paragraph 8.2 provided that “[DMT] shall defend, protect, indemnify, and hold harmless [AL]” from any loss, cost, claim or damage “on account of any illness, injury, or death, suffered by [DMT]'s employees . . . arising out of or relating to the performance of the work or services under this Charter.” (Id. ¶ 8.2.) Regarding loss or damage to AL's property, paragraph 8.3 provided as follows:
8.3 [AL] shall defend, protect, indemnify and hold harmless [DMT] from and against any loss, cost, claim, obligation to indemnify another, suit, judgment, award, or damage (including reasonable attorneys' fees), on account of loss or damage to any of [AL's] equipment and vessels, either owned, rented and operated by [AL] or its agents, subcontractors, and invitees, arising out of or relating to the performance of the work or services under this Charter, whether caused or brought about by [DMT's] negligence or any other theory of legal liability, including strict liability or the unseaworthiness of any vessel.
(Id. ¶ 8.3.) Similarly, paragraph 8.4 provided that “[AL] shall defend, protect, indemnify, and hold harmless [DMT]” from any loss, cost, claim or damage “on account of any illness, injury, or death, suffered by [AL]'s employees . . . arising out of or relating to the performance of the work or services under this Charter.” (Id. ¶ 8.4.) Notwithstanding the parties' liability and indemnity obligations, the 2018 Time Charter Agreement stated that neither party is entitled to recover from the other party any indirect, consequential, or special damages, including “loss of profits, loss of use, loss of hire, or loss of production.” (Id. ¶ 8.9.)
In May 2019, DMT and AL entered into a second time charter agreement (the “2019 Time Charter Agreement”) for the charter of the THELMA and three DMT tugs (collectively, the “vessels”). (See 2019 Time Charter Agreement; see also DeForge Decl. ¶ 8.) The 2019 Time Charter Agreement contained many of the same provisions as the 2018 Time Charter Agreement. For example, it included the same liability and indemnity provisions (compare 2019 Time Charter Agreement ¶¶ 8.1-8.4, with 2018 Time Charter Agreement ¶¶ 8.1-8.4);[7] additional equipment/alterations and end of charter provisions (compare 2019 Time Charter Agreement ¶ 3.1 & art. 5, with 2018 Time Charter Agreement ¶ 3.1 & art. 5); disclaimer of special, indirect, or consequential damages (compare 2019 Time Charter Agreement ¶ 8.9, with 2018 Time Charter Agreement ¶ 8.9); choice of law provision (compare 2019 Time Charter Agreement ¶ 12.4, with 2018 Time Charter Agreement ¶ 12.4); and system for determining the condition of the chartered vessels at the time of “on-hire” and “off-hire” (compare 2019 Time Charter Agreement art. 4, with 2018 Time Charter Agreement ¶ 4.1).
The 2019 Time Charter Agreement described the vessels to be chartered, the on-hire and off-hire dates for the...
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