In re Marine Sulphur Transport Corp.

• Decision Date: 12 May 1970
• Docket Number: 64 Ad. 769.,No. 63 Ad. 237,63 Ad. 237
• Citation: 312 F. Supp. 1081
• Parties: In the Matter of the Petition for Limitation of Liability of MARINE SULPHUR TRANSPORT CORPORATION, As Owner, and Marine Transport Lines, Inc., As Demise Charterer, of the VESSEL MARINE SULPHUR QUEEN. In the Matter of the Petition for Limitation of Liability of TEXAS GULF SULPHUR COMPANY, As Alleged Owner or Demise Charterer, of the Vessel Marine Sulphur Queen.
• Court: U.S. District Court — Southern District of New York

312 F. Supp. 1081

In the Matter of the Petition for Limitation of Liability of MARINE SULPHUR TRANSPORT CORPORATION, As Owner and Marine Transport Lines, Inc., As Demise Charterer, of the VESSEL MARINE SULPHUR QUEEN In the Matter of the Petition for Limitation of Liability of TEXAS GULF SULPHUR COMPANY, As Alleged Owner or Demise Charterer, of the Vessel Marine Sulphur Queen.

Nos. 63 Ad. 237, 64 Ad. 769.

United States District Court, S. D. New York.

May 12, 1970.

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Cadwalader, Wickersham & Taft, by John A. Sullivan, William S. Busch and Fred R. Profeta, Jr., New York City, for Marine Transport Lines, Inc., Marine Sulphur Transport Corporation and Texas Gulf Sulphur Co.

Cravath, Swaine & Moore, by Harold R. Medina, Jr., George J. Wade, David S. Cupps, and Arnold P. Messing, New York City, for Bethlehem Steel Corporation.

Bigham, Englar, Jones & Houston, by Douglas A. Jacobsen, Joseph J. Magrath, 3d, New York City, for United States Fire Ins. Co. and death claimant Martin.

Schwartz & O'Connell, by Donald E. Klein, Pressman & Scribner, by Frederick C. Stern, Standard, Weisberg, Heckerling & Rosow, by Jack Weinberger, New York City, Larry A. Roach, Lake Charles, La., Cooper, Ostrin, DeVarco & Ackerman, by Samuel Ackerman and Herbert DeVarco, Thomas M. Breen, New York City, Baker, Garber, Chazen & Duffy, by Bernard Chazen and George J. Duffy, Hoboken, N. J., Jack Steinman, New York City, of counsel, Fields, Rosen, McElligott & Auslander, by Thomas McElligott, Enrico S. San Filippo, New York City, Schneebaum & Blumenfeld, Brooklyn, N. Y., Lebovici & Safir, by Herbert Lebovici, Freedman, Borowsky & Lorry, Philadelphia, Pa., by Ned R. Phillips, New York City, for death claimants.

CANNELLA, District Judge.

The petition for exoneration from, or limitation of, liability made pursuant to 46 U.S.C. § 183 et seq. by the Marine Sulphur Transport Corporation as owner, and by Marine Transport Lines, Inc. as demise charterer, of the vessel Marine Sulphur Queen is denied, and the wrongful death claims are allowed. The wrongful death claims are also allowed against the impleaded respondent Bethlehem Steel Corporation as designer and converter of the Marine Sulphur Queen, but these claims as against the impleaded respondent Texas Gulf Sulphur Company are dismissed.

The "contingent" petition for exoneration from, or limitation of, liability made pursuant to 46 U.S.C. § 183 et seq. by the Texas Gulf Sulphur Company as alleged owner or demise charterer of the Marine Sulphur Queen is dismissed, and the claims herein against the Texas Gulf Sulphur Company are dismissed.

The cargo claim of the United States Fire Insurance Company is allowed against the Marine Sulphur Transport Corporation and Marine Transport Lines, Inc.

FINDINGS OF FACT AND CONCLUSIONS OF LAW

The claims referred to above arise out of the disappearance in the Gulf of Mexico on or about February 4, 1963 of the Marine Sulphur Queen hereinafter "Queen" or "MSQ", which had a crew of 39 and a full cargo of molten sulphur. The Marine Board of Investigation convened by the United States Coast Guard to investigate the disappearance concluded on August 23, 1963 that the Queen and her entire crew "must be presumed lost."¹ This court now finds that the MSQ and all her crew members and cargo were in fact lost on or about February 4, 1963.

The court's jurisdiction is based on 46 U.S.C. § 185, on the Jones Act—46 U.S.C. § 688, and on 28 U.S.C. § 1333(1) with regard to the claim arising under the Carriage of Goods by Sea Act, 46 U.S.C. § 1300 et seq. Jurisdiction is also predicated upon the Death on the High Seas Act² since the court finds that the MSQ and crew were lost "beyond a marine league from the shore of any State." 46 U.S.C. § 761.

* * *

On April 28, 1960, a meeting took place between representatives of impleaded respondent Bethlehem Steel, a Pennsylvania corporation hereinafter referred to as "Bethlehem," and petitioner Marine Transport Lines, a Delaware corporation hereinafter referred to as "MTL." At the meeting, Bethlehem agreed in principle to convert a T-2 tankship to a molten sulphur carrier. Fundamental to this accord were MTL requirements that the cost of the conversion not exceed $1,650,000 and that the converted ship have a minimum cargo capacity of 15,100 long tons.³ The latter requirement was part of a long-term tanker consecutive voyage charter party⁴ executed as of April 8, 1960 between MTL and the impleaded respondent, "petitioner" Texas Gulf Sulphur Company, a Texas corporation hereinafter referred to as "TGS."

Subsequent to the reaching of the agreement, petitioner Marine Sulphur Transport Corporation, a Delaware corporation and wholly owned subsidiary of MTL hereinafter "MSTC", purchased from the Humble Oil Company the Esso New Haven,⁵ an all welded T2-SE-A1 tanker of 7240 gross tons and 4057 net tons, with a length of 504 feet, breadth of 68.2 feet and depth of 39.2 feet. This ship was built in 1944 by the Sun Shipbuilding and Drydock Co. of Chester, Pennsylvania.

The design of such T-2 tankers, however, had proven from the beginning to be unreliable, to say the least. In January, 1943, the Schenectady broke in two in port, and by July, 1946, a total of 15 T-2's had experienced Class I Casualties,⁶ while numerous others had experienced lesser fractures. Indeed, a T-2 tanker, the Pine Ridge, broke up in December, 1960 while the Esso New Haven was still in the process of conversion at Bethlehem's Baltimore shipyard.⁷

The original concept of the T-2 design envisioned distribution of the cargo (petroleum) throughout the spaces, port to starboard. Nevertheless, the transformation of the Esso New Haven into the MSQ contemplated removal of the original T-2 centerline tanks and replacement of them with a single independent, sulphur-carrying tank, some 306 feet long, 30 feet, 6 inches wide and 33 feet high—such tank being internally divided by sulphur-tight transverse bulkheads into four tanks with No. 1 83 feet long, Nos. 2 and 3 73 feet long, and No. 4 77 feet. The remaining original wing tanks were to be used only for ballast. Pursuant to this basic concept, Bethlehem had drawn up Plan 43933, Alt.0⁸ which it submitted in May, 1960 to MTL, TGS, the American Bureau of Shipping hereinafter "ABS"⁹ and the Coast Guard¹⁰ for consideration. Installation of the 306-ft. tank necessitated, in effect, the gutting of the ship, and Plan 43933, Alt.0 accordingly provided, among other things, for the removal of nine transverse bulkheads located at frames 47, 50, 53, 56, 59, 62, 65, 68 and 71. There were not to be any complete or partial bulkheads connecting the structure of the cargo tank to the ship's structure. As agreed upon, MTL submitted this Plan to the George G. Sharp Co., which thereafter reported to MTL on May 17, 1960 as follows:

A preliminary study of Plan 43933, Alt.0 indicates the design to be deficient in transverse strength. All the main transverse bulkheads in the center tanks of the original tanker have been removed. We believe it will be necessary to restore at least three of those bulkheads and divide the sulphur tanks into two or three longitudinal tanks with cofferdams between. Longitudinal top and bottom girders and transverses in way of the sulphur tanks have been reduced below what is considered good practice. It may be possible to make up this deficiency by increased thickness of materials in these structural members, but this will require a detailed study. Correction of the above deficiencies will result in the reduction of the specified cargo deadweight of from 3 to 5%.¹¹

As soon as it received this report, MTL forwarded a copy to Bethlehem with a cover letter stating:

* * * The remarks contained in this report are quite disturbing to us; however, we feel that from our preliminary discussions you will be able to meet all necessary classifications and Coast Guard requirements in order that we may guarantee our Charterer TGS the specified deadweight carrying capacity of not less than 15,100 longtons of molten sulphur.¹²

A day earlier, on May 16th, J. N. Shrader of Bethlehem had encountered a similar negative reaction to Plan 43933, Alt.0 when he met with the ABS.¹³ Thereafter, on May 20th, representatives of Bethlehem again met with the ABS. Bethlehem's "basic approach was to convince the Bureau that the sulphur tank, even though attached to the ship by bolted connections (plus being welded solid to the ship's structure at the tank's mid point) actually contributes a great deal of strength by becoming part of the ship's hull girder."¹⁴ This "approach" was clearly dictated by the overriding economic concern that minimum cargo capacity not go below the specified 15,100 tons. In any event, the ABS acquiesced in this approach after the inclusion of certain features in the design.¹⁵ Bethlehem then drew up its revised Plan 43933, Alt.1¹⁶ which retained the basic single tank structure, but which added a complete transverse bulkhead at frame 59 and diaphragm bulkheads at frames 53 and 65. Furthermore, the wing tank transverse bulkheads were to be aligned with the cargo tank's transverse bulkheads. This Plan was submitted to MTL, MSTC, TGS and the ABS and Coast Guard for consideration. There were no dissenters. On August 9, 1960, MSTC entered into a contract with Bethlehem for the conversion of the Esso New Haven into the MSQ,¹⁷ and this process was completed by January 20, 1961.

Removal of the original centerline tanks and all of the transverse bulkheads in their way did not provide enough space, however, for installation of the 306-ft. tank, the cross section of which was rectangular. Additional structural reductions and/or alterations were required. The height of the center vertical keel from frames 46½ to 72½ was cut down from 7 feet, 6 inches to a constant height of 3 feet, 4 inches, and a 17 in. × 1 in. flange plate was welded to the top thereof....