In re Franz

• Decision Date: 10 March 2016
• Docket Number: 1:13-cv-411 (GLS/DJS)
• Parties: IN THE MATTER OF THE COMPLAINT OF A.P. FRANZ, JR., TRUSTEE, as owner, and BUCHANAN MARINE, L.P., as bareboat charterer of the Barge B-252 FOR EXONERATION FROM OR LIMITATION OF LIABILITY.
• Court: U.S. District Court — Northern District of New York

IN THE MATTER OF THE COMPLAINT OF A.P. FRANZ, JR.,

TRUSTEE, as owner, and BUCHANAN MARINE, L.P., as bareboat charterer

of the Barge B-252 FOR EXONERATION FROM OR LIMITATION OF LIABILITY.

1:13-cv-411 (GLS/DJS)

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF NEW YORK

March 10, 2016

APPEARANCES:

FOR THE PETITIONERS:

Lyons & Flood, LLP

65 West 36th Street, 7th Floor

New York, NY 10018

FOR THE CLAIMANTS:

Wayne & Karen Volk

Melley, Platania Law Firm

24 Closs Drive

Rhinebeck, NY 12572

Tilcon New York, Inc.

Cook, Netter Law Firm

P.O. Box 3939

85 Main Street

Kingston, NY 12402

OF COUNSEL:

EDWARD P. FLOOD, ESQ.

STEVEN M. MELLEY, ESQ.

ERIC M. KURTZ, ESQ.

Gary L. Sharpe Senior District Judge

MEMORANDUM-DECISION AND ORDER

I. Introduction

Petitioners A.P. Franz, Jr., Trustee, as owner, and Buchanan Marine, L.P., as bareboat charterer, of the barge B-252 commenced this action pursuant to the Limitation of Liability Act of 1851¹ (hereinafter "Limitation Act") seeking exoneration from or limitation of liability. (Compl., Dkt. No. 1.) Pending are Franz and Buchanan's motion for summary judgment, (Dkt. Nos. 45-50), and the summary judgment motion of claimant Tilcon New York, Inc., (Dkt. No. 51). Claimants Wayne and Karen Volk cross-moved for summary judgment, seeking dismissal of the limitation proceeding. (Dkt. No. 53.) For the reasons that follow, the court grants the motions of Franz, Buchanan, and Tilcon, denies the Volks' cross-motion, and grants Franz and Buchanan's complaint for exoneration from liability.

II. Background

A. Facts²

Claimant Wayne Volk (hereinafter "W. Volk") worked as a barge checker for Buchanan at the Clinton Point quarried rock processing facility operated by Tilcon on the Hudson River. (Pets.' Statement of Material Facts (SMF) ¶¶ 1, 7, Dkt. No. 49.) At the facility, Tilcon processes quarried rock and loads the rock onto barges supplied by Buchanan. (Tilcon's SMF ¶ 8, Dkt. No. 51, Attach. 1.) Using its tug boats, Buchanan then transports the barges down river to Tilcon's customers. (Id. ¶¶ 8, 35.)

On May 19, 2011, W. Volk fell and injured his right arm and shoulder while inspecting a barge after it was loaded with wet stone. (Pets.' SMF ¶ 13; Tilcon's SMF ¶¶ 42-45; Dkt. No. 53, Attach. 3 at 110; Dkt. No. 53, Attach. 12.) W. Volk slipped on loose, excess stones on the side or margin deck on the northern, port end of the barge's stern. (Dkt. No. 12 ¶ 5; Dkt. No. 53, Attach. 3 at 90-91.) Nobody witnessed his fall. (Pets.' SMF ¶ 13.) Before the barge was loaded, W. Volk inspected it and noted that its deck was clear of all stones. (Id. ¶ 14.) The stones that he tripped over came onto the deck during Tilcon's loading process. (Id.) W. Volk notified Timothy Conn, his supervisor and foreman, who was also employed by Buchanan, about his injury, and, the following day, Conn drove W. Volk to a clinic to receive medical treatment for the injury. (Id. ¶ 15; Tilcon's SMF¶ 2.)

W. Volk has not worked since the accident and has been receiving workers' compensation under the Longshore and Harbor Workers' Compensation Act³ (LHWCA). (Pets.' SMF ¶¶ 17, 21; Dkt. No. 47 ¶¶ 7, 9.) He also applied for New York State workers' compensation benefits, however, the board denied his claim because he was already receiving LHWCA benefits. (Pets.' SMF ¶ 17; Dkt. No. 47 ¶ 8.)

W. Volk's injury occurred aboard the barge B-252. (Pets.' SMF ¶ 13.) The B-252 was a "'dumb' barge" that required a tugboat to ferry it from place to place. (Id. ¶ 6; Dkt. No. 53, Attach. 3 at 22-24.) Franz owned the B-252 as a trustee, and, in July 1993, Franz bareboat chartered that barge along with his fleet of other barges and tug boats to Buchanan for a period set to expire in December 2018.⁴ (Pets.' SMF ¶¶ 2-4; Dkt. No. 47, Attach. 1.) Pursuant to the bareboat charter, Franz transferred exclusive control to Buchanan to use, operate, command, and navigate his fleet of barges and tug boats. (Pets.' SMF ¶ 4; Dkt. No. 47, Attach. 1§ 8(b).)

Buchanan used the B-252 and the other barges to transport suppliers', like Tilcon's, products down the Hudson River to their customers. (Tilcon's SMF ¶¶ 7-13, 35, 38-41.) Although Buchanan docked its barges at Tilcon's Clinton Point facility, Buchanan retained responsibility for their inspection and maintenance. (Id. ¶¶ 15-16.) After the barges arrived at the facility, Buchanan employees would inspect them and report their findings to Conn, their supervisor, who then discussed with Alex Perlman, his supervisor, whether or not the barge was "loadable." (Id. ¶¶ 19, 21.) If the barges required maintenance, Conn would direct Buchanan employees to repair them before they were deemed suitable to be loaded and transported. (Id. ¶ 25.)

Once a barge was declared loadable, Tilcon's employees would load the quarried rock onto it. (Id. ¶ 28.) After the rock was loaded, the barge would be moved to another dock for Buchanan employees to conduct a final inspection before the barge would be transported by a tug boat down river to Tilcon's customers. (Id. ¶¶ 35-36, 38.)

As a barge checker, W. Volk was paid hourly. (Pets.'s SMF ¶ 11.) His employment duties involved inspecting Buchanan's barges that cameinto the Clinton Point facility both before and after loading along with performing necessary repairs and maintenance to the barges. (Id. ¶¶ 7, 9, 11.) When W. Volk boarded the barges to perform inspections and maintenance they were berthed to the dock, but could be as many as three or four barges deep from the dock at one time. (Id. ¶ 8.) He was not assigned to work on a particular barge, did not eat meals on any barge, and never slept overnight on the barges. (Id. ¶¶ 10-11.) Additionally, W. Volk is a member of the International Union of Operating Engineers, which is a union for equipment operators. (Id. ¶ 20.) W. Volk does not belong to a maritime union and does not have maritime licences such as a seaman's work card, also known as a "ZCard." (Id. ¶ 19.) Accordingly, he never worked on one of Buchanan's tug boats. (Id. ¶ 18.)

B. Procedural History

On October 16, 2012, the Volks filed a complaint to recover for personal injury against Buchanan and Tilcon in New York State Supreme Court in Ulster County. (Compl., Attach. 2.) In response, on April 15, 2013, Franz and Buchanan commenced this federal court action pursuant to the Limitation Act seeking exoneration from or limitation of liability. (Compl.) Pursuant to Supplemental Rule F(1) of the Federal Rules of CivilProcedure, Franz and Buchanan offered a security bond of $47,420.77, representing the value of their interest in the B-252. (Compl. ¶ 11; Dkt. No. 1, Attach. 4.) The court thereafter granted Franz and Buchanan's motion to approve security, enjoin suits, and direct the issuance of notice. (Dkt. No. 4.)

Both the Volks and Tilcon answered and asserted counterclaims. (Dkt. Nos. 6, 12, 15.) Specifically, the Volks alleged both direct and derivative claims under the Jones Act,⁵ LHWCA, general maritime law, and New York state law. (Dkt. No. 15.) The Volks then filed a motion to dismiss, (Dkt. No. 16), which the court subsequently denied, (Dkt. No. 21). The court directed Franz and Buchanan to increase their security by $10,000. (Id.) The parties completed discovery, and the motions referenced above were filed. For the reasons that follow, the court grants the motions of Franz, Buchanan, and Tilcon, denies the Volks' cross-motion, and grants Franz and Buchanan's complaint for exoneration from liability.

III. Standard of Review

The standard of review pursuant to Fed. R. Civ. P. 56 is wellestablished and will not be repeated here. For a full discussion of the standard, the court refers the parties to its decision in Wagner v. Swarts, 827 F. Supp. 2d 85, 92 (N.D.N.Y. 2011), aff'd sub nom. Wagner v. Sprague, 489 F. App'x 500 (2d Cir. 2012).

IV. Discussion

A. Limitation Act

In the court's earlier decision, it held that Franz and Buchanan's allegation that negligence occurred without their privity or knowledge sufficiently stated their entitlement to limit their liability under the Limitation Act on a motion to dismiss. (Dkt. No. 21 at 8-9.) The Volks now renew their argument on summary judgment. (Dkt. No. 53 at 19.) Specifically, the Volks contend that Franz or Buchanan cannot show that they did not have privity or knowledge of negligence because: (1) photos reveal unsafe conditions around the B-252; (2) there were stones on the deck of the port, stern side of the B-252 at the time of W. Volk's accident that Franz or Buchanan should have known about; (3) the Volks' expert confirmed that the presence of such stones violates Occupation Safety and Health Administration (OSHA) regulations; and (4) affidavits from former Buchanan employees state that stones regularly covered the barge decks.(Id.; Dkt. No. 16, Attach. 1 at 8-12.) In reply, Franz and Buchanan maintain that there is a factual dispute about the condition of the barge because its expert opined that the B-252 was "'fit for its intended purpose and seaworthy'" on the day of the accident. (Dkt. No. 54 at 8 (quoting Dkt. No. 55, Attach. 3 at 8).)

A proceeding commenced pursuant to the Limitation Act "protects the right of vessel owners [and bareboat charterers] to limit their liability to the value of the vessel [and its frieght]." Lewis v. Lewis & Clark Marine, Inc., 531 U.S. 438, 453 (2001); see 46 U.S.C. §§ 30501, 30505(a). In fact, "[i]t is well established that a vessel owner may seek both limitation of liability and a total exoneration from liability in the same limitation action." In re Bridge Constr. Servs. of Florida, Inc., 39 F. Supp. 3d 373, 381 (S.D.N.Y. 2014). The test of whether a vessel owner may be absolved from or can limit his liability requires two inquires. See Otal Invs. Ltd. v. M/V Clary, 673 F.3d 108, 115 (2d Cir. 2012). First, a claimant bears the initial burden to show what, if any, negligence caused the accident. See id. If a claimant does not demonstrate that actionable conduct occurred, "there is no liability to be limited and the owner...