In re Glacier Bay, A88-115 Civ.

• Decision Date: 13 April 1990
• Docket Number: No. A88-115 Civ.,A88-115 Civ.
• Citation: 741 F. Supp. 800
• Parties: In re the GLACIER BAY.
• Court: U.S. District Court — District of Alaska

741 F. Supp. 800

In re the GLACIER BAY.

No. A88-115 Civ.

United States District Court, D. Alaska.

April 13, 1990.

Michael M. Woodell, Bradbury, Bliss & Riordan, Anchorage, Alaska, for Trinidad Corp., West of England Ship Owner's Mut. Ins. Ass'n (Luxembourg), Ltd. (formerly known as The West of England Ship Owners Protection and Indem. Ass'n (Luxembourg), Kee Leasing Co., and Mathiasen's Tanker Industries, Inc.

J.W. Sedwick, Thomas E. Meacham, Burr, Pease & Kurtz, Anchorage, Alaska, (Alan Braverman, Wilmer, Cutler & Pickering, Washington, D.C., of counsel), for Trans-Alaska Pipeline Liability Fund.

John A. Treptow, Atkinson, Conway & Gagnon, Anchorage, Alaska (Lawrence A. Waks, Milgrim Thomajan & Lee, Austin, Tex., of counsel), for Tesoro Petroleum Corp. and Tesoro Alaska Petroleum Co.

Stephen M. Ellis, Delaney, Wiles, Hayes, Reitman & Brubaker, Anchorage, Alaska, for Cook Inlet Response Organization.

James D. Gilmore, Gilmore & Feldman, Anchorage, Alaska, for Andrew Subcleff.

Gary J. Strauss, Garvey, Schubert & Barer, Seattle, Wash. (Marcia Davis, BP Exploration (Alaska), Inc., Anchorage, Alaska, of counsel), for S.P.C. Shipping Inc., Standard Oil Co. and BP America, Inc.

Carl J.D. Bauman, Hughes, Thorsness, Gantz, Powell & Brundin, Anchorage, Alaska, for Kenai Pipe Line Co.

R. Michael Underhill, Trial Atty. (attorney to be served) Stuart E. Shiffer, Acting Asst. Atty. Gen., Mark Davis, Acting U.S. Atty., Phillip A. Berns, Atty. in Charge, West Coast Office, Richard A. Knee, Trial Atty., Torts Branch, Civ. Div., U.S. Dept. of Justice, San Francisco, Cal., for U.S. Coast Guard.

Brian B. O'Neill, Steven C. Schroer, Gerard M. Nolting, Jack M. Fribley, Jeff H. Eckland, Lori Ann Wagner, Sarah Armstrong, Richard A. Duncan, Melanie Julian Muckle, Franklyn F. Bergland, Faegre & Benson, Minneapolis, Minn., Arthur S. Robinson, Robinson, Beiswenger & Ehrhardt, Soldotna, Alaska, Martin Friedman, Friedman & Bros., Homer, Alaska, for plaintiffs Bill Choate, et al.

Timothy J. Petumenos, Birch, Horton, Bittner, Cherot & Anderson, Anchorage, Alaska, for plaintiffs Royal Pacific Fisheries, Inc., Inlet Fisheries, Inc., Salamatof Seafoods, Inc.

Peter A. Galbraith, Galbraith & Owen, Anchorage, Alaska, for plaintiff Cook Inlet Processing, Inc.

Robert Hahn, Hahn, Jewell & Stanfill, Anchorage, Alaska, for Eppes, Ducker and Correson, plaintiffs.

C. Michael Hough, Homer, Alaska, for Anahonak, Austin, D. Basargin, Fedosia Basargin, Snegrreff and Wayne Woodhead, plaintiffs.

John C. Pharr, Anchorage, Alaska, for plaintiffs Frank Wood and Stephen R. Dominish.

Kay E. Maassen Gouwens, Asst. Atty. Gen., State of Alaska, Dept. of Law, Anchorage, Alaska, for plaintiff State of Alaska.

ORDER

HOLLAND, Chief Judge.

Motions to Dismiss Limitation Complaint

Kee, Mathiasen's, GBTC, and Trinidad jointly filed a complaint for exoneration from or limitation of liability on September 7, 1989. At a pre-trial conference held on November 21, 1989, the court agreed to the parties' request that the lodged monition not be signed until after the motions to dismiss the limitation complaint were decided.

Kee is the owner of the vessel, the Glacier Bay. Mathiasen's was a bareboat charterer of the Glacier Bay. GBTC was a sub-bareboat charterer of the Glacier Bay. GBTC demise-chartered the vessel to Trinidad. Trinidad was the operator of the Glacier Bay when the spill occurred. Trinidad had time-chartered the Glacier Bay to SPC Shipping. SPC had then entered a long-term contract of affreightment with Tesoro which resulted in a voyage or spot charter of the Glacier Bay by Tesoro at the time the oil spill occurred. Tesoro owned the oil which was spilled. Subsequent to the oil spill, Trinidad, GBTC, and Mathiasen's, as affiliated companies of Apex Oil Company, filed a Chapter 11 bankruptcy petition; Kee did not.

Separate motions to dismiss the limitation action were filed by Tesoro, TAPL Fund (Fund), Kenai Pipe Line (KPL), and all plaintiffs in the various damages actions (plaintiffs). The motions of Tesoro, Fund, and plaintiffs were joined in by SPC Shipping and CIRO, plus third-party defendants: Amoco Production Co., ARCO Alaska, Chevron USA, Kenai Pipeline, Marathon Oil, Phillips Petroleum, Shell Oil, and Union Oil of California. Amici curiae briefs supporting the motions to dismiss were lodged (but not accepted by the court) from Senator Ted Stevens, The Wilderness Society, Defenders of Wildlife, and The Sierra Club.

The motions to dismiss are based on two grounds:

(1) That the Trans-Alaska Pipeline Authorization Act, 43 U.S.C. §§ 1651-1655, repealed the application of the Limitation of Vessel Owner's Liability Act, 46 U.S.C. §§ 181-189, to the transportation of oil from the Alaska pipeline; and

(2) That the limitation complaint was untimely filed.

Effect of TAPAA

Plaintiffs' and the Fund's motions to dismiss raise the issue of whether the Trans-Alaska Pipeline Authorization Act (TAPAA), 43 U.S.C. §§ 1651-1655, repeals the Limitation Act for spills of Alaska pipeline oil.

The Limitation Act permits vessel owners and charterers to limit their liability for damage caused by their vessel to the post-accident value of the ship plus its freight. 46 U.S.C.App. §§ 183, 186. In contrast, TAPAA contains a comprehensive liability scheme for marine spills of Trans-Alaska Pipeline System (TAPS) oil. 43 U.S.C. § 1653(c). TAPAA makes $100 million per spill available to pay damage claims on a strict liability basis. The first $14 million of claims out of that $100 million is paid by the vessel owner/operator. 43 U.S.C. § 1653(c)(3). Any remaining claims, up to an additional $86 million, are paid by the Trans-Alaska Pipeline Liability Fund which is funded by the owners of the TAPS oil. 43 U.S.C. § 1653(c)(3)-(5). The vessel owner/operator and the Fund have certain subrogation rights under TAPAA. In addition, the states are specifically not precluded from imposing additional requirements. 43 U.S.C. § 1653(c)(8)-(9).

The limitation complaint involved here seeks to limit the owner's and charterers' liability to $6,551,282, the post-accident value of the vessel and its freight. Nevertheless, there is no dispute among the parties that the Limitation Act does not apply to the vessel owner/operator's strict liability for $14 million under TAPAA. In Trinidad's "Position Paper on Interface of TAPAA and TOVALOP with the Limitation Action", Trinidad, GBTC, Mathiasen's, Kee, and West concede the following points, among others:

3. Trinidad and West will not assert in this action that the Limitation Act may be used to limit their potential strict liability under TAPAA for up to $14 million.

....

5. Trinidad, GBTC, Mathiasen's and Kee will assert they are entitled to limit their liability pursuant to the Limitation Act as to all causes of action brought by third parties, including the U.S. Government, the State of Alaska and the Trans-Alaska Pipeline Liability Fund for:

a. Amounts in excess of $14 million under TAPAA;

b. All claims brought under the general maritime law;

c. All claims brought pursuant to state statute or state common law.

(Citations omitted; emphasis added.)

Plaintiffs and the Fund separately moved to dismiss under Rule 12(b)(6), Federal Rules of Civil Procedure, on the grounds that the Limitation Act is inapplicable to spills of TAPS oil. Plaintiffs and the Fund asserted that TAPAA established a comprehensive scheme governing liability for maritime spills of TAPS oil that repealed the liability limiting provisions of the Limitation Act. Plaintiffs and the Fund base their position on the "notwithstanding the provisions of any other law" clause in subsection 1653(c)(1), the subsection 1653(c)(9) provision that states may set higher limits on liability than those set out in TAPAA, the subsection 1653(c)(3) provision allowing adjudication of the unpaid portion of any claim under other applicable law, the subsection 1653(c)(8) subrogation rights granted to the Fund, and the legislative history contained in the conference report (H.R. Conf.Rep. No. 924, 93d Cong., 1st Sess., reprinted in 1973 U.S.Code Cong. & Admin. News 2417, 2523, 2530-2531).

Trinidad, Kee, Mathiasen's, and GBTC (hereinafter collectively referred to as "Trinidad") responded that TAPAA did not repeal the Limitation Act for claims in excess of the $14 million strict liability imposed by TAPAA. The United States argues that while the Limitation Act does not apply to either the $14 million of owner/operator's strict liability or the Fund's $86 million strict liability under TAPAA, the Limitation Act does apply to certain claims under TAPAA, such as unpaid portions of claims in excess of $100 million and subrogation rights asserted by the Fund against vessel owners/operators.

The starting point in statutory construction is the language of the statute itself. Blackfeet Indian Tribe v. Montana Power Co., 838 F.2d 1055, 1058 (9th Cir.1988). If the legislative intent was to repeal an earlier statute, that intent must be clear and manifest. Id. While TAPAA makes no specific reference to a repeal of the Limitation Act, plaintiffs argue that the clause "notwithstanding the provisions of any other law" (contained in subsection 1653(c)(1)) is clear evidence of legislative intent to supersede the Limitation Act. The United States and Trinidad maintain that the phrase applies only to the strict liability established in subsection 1653(c)(1), and not to the entire subsection. Subsection 1653(c)(1) provides as follows:

Notwithstanding the provisions of any other law, if oil that has been transported through the trans-Alaska pipeline is loaded on a vessel at the terminal facilities of the pipeline, the owner and operator of the vessel (jointly and severally) and the Trans-Alaska Pipeline Liability Fund established by this subsection, shall be strictly liable without regard to fault in accordance with the provisions of this subsection for all damages, including clean-up costs, sustained by any

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