In re Moran Phila., Div. of Moran Towing Corp., CIVIL ACTION NO. 14-7079

Decision Date31 March 2016
Docket NumberCIVIL ACTION NO. 14-7079
Parties In the Matter of the Complaint of Moran Philadelphia, Division of Moran Towing Corporation, as Owner and Operator of the Tug Cape Cod.
CourtU.S. District Court — Eastern District of Pennsylvania

George R. Zacharkow, Mattioni Ltd., Philadelphia, PA, for Moran Philadelphia, Division of Moran Towing Corporation, as Owner and Operator of the Tug Cape Cod.

OPINION

Slomsky

, District Judge
I. INTRODUCTION

This admiralty case involves a barge crane owned by Rhoads Industries, Inc. (“Rhoads”) that was damaged in the Port of Philadelphia while it was being moved by a tug boat owned and operated by Moran Towing Corporation on November 9, 2012. This Court has subject matter jurisdiction over this admiralty and maritime case pursuant to 28 U.S.C. § 1333

.1 It has been divided into two phases at the request of the parties, with the first and current phase addressing the applicability of the Schedule of Rates, Terms and Conditions, including a limitation of liability provision, that is published online by Moran Towing Corporation (“Moran”).2 The second phase will encompass all remaining discovery and liability issues.

Moran has moved for Partial Summary Judgment seeking a determination that the Schedule of Rates, Terms and Conditions applies to the services provided by Moran's tugboat which resulted in the allision.3 (Doc. No. 33.) Rhoads filed a Response in Opposition to the Motion, arguing that the Schedule does not apply. (Doc. No. 36.) Moran filed a Reply to the Response. (Doc. No. 37.) For reasons that follow, Moran's Motion for Partial Summary Judgment (Doc. No. 33) will be granted.

II. FACTUAL BACKGROUND

The following facts are taken from the agreed upon Statement of Facts (Doc. Nos. 33, 35), as well as deposition testimony and documents attached to the summary judgment filings.

A. The Parties

Moran is engaged in the towing business, and currently operates in sixteen ports along the East and Gulf Coasts of the United States. (Doc. Nos. 33, 35 ¶ 1.) It operates along the Delaware River and in the Port of Philadelphia under the name Moran Philadelphia, Division of Moran Towing Corporation, and has a place of business at the Philadelphia Naval Shipyard. (Id.)

Rhoads has been engaged in the metal fabrication business since 1938. In 2010, it added a division to provide ship maintenance, repair, and fabrication services at the Philadelphia Naval Shipyard under the name Rhoads Maritime Industries. (Id.¶ 2.) Rhoads' maritime customers include Aker Philadelphia, the U.S. Navy, the Army Corps of Engineers, Northrop Grumman, and Lockheed Marin Corp. (Id.) At the Port of Philadelphia, Rhoads used the following companies to provide tug services in the Naval Shipyard: Moran, McAllister Towing of Philadelphia, Inc. (“McAllister”), and Wilmington Tug, Inc. (“Wilmington”). (Id.¶ 3.) Rhoads has also used for towing services Hays Tug and Launch Service, Inc. (“Hays”), K-Sea Transportation Partners (“K-Sea”), and Kirby Offshore Marine (“Kirby”). (Doc. No. 35 ¶ 3.)

John Gazzola was the General Manager and Vice President of Moran's operation in the Port of Philadelphia from 1999 to August 2010. (Doc. Nos. 33, 35 ¶ 8.) In August 2011, Gazzola joined Rhoads. (Id.¶ 10.) He left the company in 2013. (Id.) At Rhoads, he held the position of Director and Vice President for Sales, and also served in the capacity of Port Manager. (Id.) He was the primary connection between Rhoads and the port community maritime vendors, and he was responsible for directing towage services. (Id.)

B. Rhoads' Use of Moran to Perform Towing Services

Rhoads used Moran's tug services on eleven occasions from August 24, 2011 to October 29, 2012. (Doc. Nos. 33, 35 ¶ 12; Doc. No. 33-2, Ex. 9.) Rhoads requested tug services by calling or emailing Moran. Moran sent invoices to Rhoads and each one was paid. (Doc. Nos. 33, 35 ¶¶ 12, 19(f).) Each invoice was addressed to Rhoads and to the attention of Gazzola. (Doc. No. 33-2, Ex. 9.) Each invoice referenced Moran's Schedule of Rates, Terms and Conditions. (Id.) Specifically, the following notice was printed at the bottom of each invoice in capital letters:

ALL HARBOR TUG SERVICES ARE RENDERED SUBJECT TO MORAN'S
CURRENT SCHEDULE OF RATES TERMS AND CONDITIONS IN EFFECT FOR THE PORT IN WHICH THE SERVICE IS PERFORMED, INCLUDING WITHOUT LIMITATION, TERMS PERTAINING TO LIMITATION OF MORAN'S LIABILITY AND THE NON-PROVISION BY MORAN OF PILOTAGE. ADDITIONAL COPIES OF MORAN'S APPLICABLE SCHEDULE ARE AVAILABLE ON REQUEST OR MAY BE ACCESSED DIRECTLY UNDER THE SERVICES TAB AT MORAN'S INTERNET WEB PAGE: WWW.MORANTUG.COM.

(Id. ; Doc. Nos. 33, 35 ¶ 7.)

The employees of Moran and Rhoads became aware in October 2012 that Superstorm Sandy was going to hit the Port of Philadelphia. As a result, Rhoads requested tug services from Moran to hold a ship in place. (Doc. Nos. 33, 35 ¶ 14; Doc. No. 33-2, Exs. 10, 11.) On October 29, 2012, Nathan Hauser, General Manager and Vice President of Moran's Philadelphia operation, sent the following confirming email to Gazzola, and attached to the email a copy of Moran's Schedule of Rates, Terms and Conditions:

Hello John,
Thanks for your order of two tugs for 1800 this evening for the storm “Sandy”. We will honor our current agreed rate of $500 per hour for this service. Per our conversation a fuel surcharge will be applied to this rate for the hours the tug is actively pushing.
Please find attached our published “Schedule of Rates, Terms and Conditions”. All services rendered are subject to these terms.
Thanks,
Nathan

(Id.) Rhoads did not object to being subject to the Schedule in relation to the Superstorm Sandy job. (Doc. Nos. 33, 35 ¶ 15.) The services were rendered, and an invoice was provided in accordance with the invoice practice described above.

Thereafter, on November 8, 2012, Gazzola, on behalf of Rhoads, telephoned Moran and requested that it provide tug services to shift a YD-209 crane barge within the Philadelphia Naval Shipyard on the following day. (Doc. Nos. 33, 35 ¶ 17.) Other than this telephone call, there was no paperwork or emails that were immediately sent by Moran to Rhoads. The next day, on November 9, 2012, Moran performed the services requested by Gazzola. It dispatched the tug Cape Cod to shift the YD-209. (Id.¶ 18.) During the movement, a section of the crane boom on the barge contacted the overhanging antenna platform of the U.S.S. John Fitzgerald Kennedy twice, causing each to sustain damage. (Id.) As a result of this allision, the YD-209 was moved back alongside the bulkhead and the operation was not completed. (Id.) Moran did not send Rhoads an invoice for the services provided on November 9, 2012. (Doc. No. 35 ¶ 7.)

C. Moran's Schedule of Rates, Terms and Conditions

As noted, Moran uses a “Schedule of Rates, Terms and Conditions” which is published on its website, located at www.morantug.com.4 (Doc. No. 33-1.) Moran has not changed the terms of its Schedule of Rates, Terms and Conditions for the Port of Philadelphia since January 15, 2009. (Doc. Nos. 33, 35 ¶ 9.) To access the Schedule of Rates, Terms and Conditions on Moran's website, a visitor would click through the following links from the homepage: “Port Information and Rates,” the port of interest (here, Philadelphia), and “Rates.”5 (Doc. No. 33-1.) A document then opens, which is referred to by the parties as the Schedule of Rates, Terms and Conditions (or the “Schedule”). Because the applicability of this document here is the crux of the current dispute, a detailed description is warranted.

The first page of the document contains the Moran Philadelphia logo and contact information at the top, along with the title: “Schedule of Rates, Terms and Conditions” and the notation: “Effective January 15, 2009. (Doc. No. 33-1 at 8.) Below the title and date is a double horizontal line across the page which divides the page approximately in half. (Id.) Under the double line is the title “TOWAGE AGREEMENT.” (Id.) Under “Towage Agreement” is a short three-paragraph agreement with blank spaces in which to insert the date and party names, and signature lines. (Id.) The agreement essentially states that Moran will provide all towage requirements of the party at the Port of Philadelphia. (Id.) It has been referred to as an exclusivity agreement, or in accordance with its title, a Towage Agreement. Specifically, the Towage Agreement states the following:

It is hereby agreed between Messrs: _______________ (hereinafter called ‘OWNERS‘) and Moran Philadelphia, a division of Moran Towing Corporation (and its successors) (hereinafter called ‘MORAN‘) that MORAN will furnish tugs for and attend to all the towage requirements at the Port of Philadelphia, Pennsylvania, Delaware River and vicinity of vessels owned, managed or controlled by OWNERS, and OWNERS agree to place all of their towage requirements at the Port of Philadelphia, Pennsylvania and vicinity with MORAN in accordance with the current ‘Schedule of Rates, Terms & Conditions‘ below, as may be amended from time to time.
OWNERS agree that MORAN shall have the right at any time, upon thirty (30) days advance notice to OWNERS, to increase its rates or adjust terms and conditions, but if OWNERS do not consent to such changes, they may cancel this Contract upon fifteen (15) days written notice to MORAN.
This Contract shall remain in force from __________ and shall continue in force thereafter from year to year until cancelled by either party giving to the other at least thirty (30) days notice in writing prior to the annual expiration date.

(Id.) As noted, following these terms are lines for signatures by the “Owner” and Moran Philadelphia. (Id.) At the bottom of the first page, the following language is printed in capital letters: ”IT IS UNDERSTOOD THAT ALL TUG SERVICES PERFORMED BY MORAN ARE SUBJECT TO ALL THE TERMS AND CONDITIONS SET FORTH IN THE CURRENT “SCHEDULE OF RATES, TERMS AND CONDITIONS.” (Id.)

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