In re TK Boat Rentals, LLC

• Decision Date: 07 August 2019
• Docket Number: 17-3657,CIVIL ACTION NOS. 17-1545 c/w 17-2446
• Citation: 411 F.Supp.3d 351
• Parties: IN RE: TK BOAT RENTALS, LLC, as Owner and Operator of the M/V Miss Ida, for Exoneration from or Limitation of Liability
• Court: U.S. District Court — Eastern District of Louisiana

411 F.Supp.3d 351

IN RE: TK BOAT RENTALS, LLC, as Owner and Operator of the M/V Miss Ida, for Exoneration from or Limitation of Liability

CIVIL ACTION NOS. 17-1545 c/w 17-2446

17-3657

United States District Court, E.D. Louisiana.

Signed August 7, 2019

Harry E. Morse, Martin S. Bohman, Bohman Morse, LLC, Alfred Jackson Rufty, III, Harris & Rufty, LLC, New Orleans, LA, for TK Boat Rentals, LLC.

SECTION M (4)

ORDER & REASONS

BARRY W. ASHE, UNITED STATES DISTRICT JUDGE

Before the Court are the following motions:

(1) the motion of defendants Andre Boudreau and GEICO Marine Insurance Company ("GEICO") for summary judgment on their crossclaim against defendant Allianz Global Corporate and Specialty Marine Insurance Company ("AGCS") for insurance coverage.¹ AGCS opposes the motion,² Boudreau and GEICO file a reply in support of the motion,³ and AGCS files a surreply;⁴

(2) AGCS's motion for summary judgment on its crossclaim against GEICO for insurance coverage.⁵ GEICO opposes the motion,⁶ and AGCS files a reply in support of the motion;⁷ (3) GEICO's motion to strike certain of AGCS's summary judgment exhibits.⁸ AGCS opposes the motion,⁹ GEICO files a reply in support of the motion,¹⁰ and AGCS files a surreply;¹¹ and

(4) a motion of Extreme Fishing, LLC ("Extreme Fishing") for summary judgment on its right to limitation of liability,¹² to which claimants respond in opposition,¹³ and in further support of which Extreme Fishing replies.¹⁴

Having considered the parties' memoranda and the applicable law, the Court issues this Order & Reasons.

I. BACKGROUND

This case arises out of a boating accident. Patrick Beck booked a fishing trip out of Venice, Louisiana, with Extreme Fishing through Troy Wetzel, Extreme Fishing's founder and sole member,¹⁵ for February 12, 2017.¹⁶ Wetzel generally books fishing trips by phone and hires a captain to operate one of the boats that he owns and leases to Extreme Fishing.¹⁷ For Beck's trip, Wetzel hired Boudreau, a licensed captain¹⁸ whom he had observed at work on scores of occasions over the course of three or four years, to captain Wetzel's M/V Kingfish.¹⁹ However, on February 11, 2017, the M/V Kingfish became inoperable when its port propeller inexplicably spun off into the marsh on another fishing trip.²⁰ As a consequence, instead of using the M/V Kingfish for Beck's trip, Wetzel asked whether Boudreau could secure another vessel. Knowing that Chase St. Clair owned a fishing vessel, Boudreau received permission to use the M/V Super Strike for the trip.²¹

On the morning of February 12, 2017, Boudreau captained the M/V Super Strike for passengers Beck, his minor son, C.D.B., Justin McCarthy, Michael Harrell (collectively, "Plaintiffs"), Tracy Edwards, and Charles "Nick" Siria.²² Upon leaving the Venice Marina, fog limited visibility to approximately 50 to 75 yards.²³ Boudreau operated boats in similar conditions approximately 15 to 20 times per year.²⁴ His hired deckhand, Mitchell Rogers, acted as lookout for the trip while Boudreau navigated using radar.²⁵ Boudreau testified in his deposition that he had expected the fog but that he was not concerned about visibility conditions.²⁶ The M/V Super Strike 's lights were operational and illuminated for the trip.²⁷

To access the Gulf of Mexico, Boudreau planned to leave the Venice Marina, enter the Mississippi River from an area known as "The Jump," proceed downriver off the right descending bank (the West Bank), and then cross the river to the East Bank just south of Andres Pond so as to avoid an area of known dredging activity and to exit the river and enter the Gulf through Pass a Loutre.²⁸ Before crossing the river, the M/V Super Strike 's port engine had stalled between four and six times.²⁹ Boudreau testified that, after the third time, he called St. Clair to inquire about the condition of the engine, but could not reach him.³⁰ Boudreau further testified that he was able to restart the engine each time after it stalled,³¹ and that both engines were operational as he crossed the river.³² The passengers testified that only the starboard engine was fully operational as they crossed the river.³³

As the M/V Super Strike entered the Mississippi River, Boudreau testified that visibility was approximately 20 yards due to fog, and that visibility ranged between 10 and 20 yards throughout the remainder of the voyage.³⁴ About three-quarters of the way across the river, Boudreau observed an unidentified object appear and then disappear on his radar, which prompted him to reduce his speed.³⁵ Boudreau then observed another radar contact, what he later learned to be the M/V Miss Ida , proceeding in a westerly direction. Based on the radar signals, Boudreau believed that the M/V Miss Ida was then crossing the river heading to the West Bank.³⁶ Boudreau testified that, by then, he had reduced the speed of the M/V Super Strike to about 20 miles per hour and that visibility was about 15 yards.³⁷ As Boudreau continued to monitor the radar, he noticed that the M/V Miss Ida was then moving in a northerly, not westerly, direction. Boudreau testified that he then put the M/V Super Strike in neutral, assuming that the vessels would pass each other starboard-to-starboard (with the M/V Super Strike nearer the East Bank).³⁸ About 30 seconds later according to Boudreau's estimate and before he could take evasive action, the M/V Miss Ida collided with the M/V Super Strike , which had drifted with the current about 75 feet.³⁹ Deckhand Rogers testified, on the other hand, that the M/V Super Strike was in reverse when the M/V Miss Ida broke through the fog within 300 yards of the M/V Super Strike.⁴⁰ Boudreau testified that if he would have attempted a port-to-port passing, he believed he would have created a head-on collision.⁴¹ Shane Leblanc, captain of the M/V Miss Ida , testified that he never reduced his speed of 15 to 20 miles per hour from the time he observed the M/V Super Strike on his radar up until the moment of impact, because he assumed each vessel would turn to starboard to effect a port-to-port passing.⁴² Toward this end, Leblanc veered his vessel to starboard, but the M/V Miss Ida struck and mounted the starboard bow of the M/V Super Strike at a perpendicular angle.⁴³ Plaintiffs allege they sustained serious injuries as a result of the accident.⁴⁴

On February 23, 2017, TK Boat Rentals, owner and operator of the M/V Miss Ida , filed a limitation-of-liability action related to the accident.⁴⁵ On March 24, 2017, Plaintiffs instituted an action for damages against several defendants, including Extreme Fishing, TK Boat Rentals, Wetzel, Boudreau, St. Clair, and GEICO (which Plaintiffs allege was St. Clair's insurer on the date of the collision).⁴⁶ On April 19, 2017, St. Clair and Boudreau, owner and operator of the M/V Super Strike , jointly filed a limitation-of-liability action.⁴⁷ The two limitation actions and Plaintiffs' suit for damages were consolidated into this action.⁴⁸ Plaintiffs eventually added a claim against AGCS, the alleged insurer of Wetzel⁴⁹ and Extreme Fishing.⁵⁰

On February 15, 2018, Boudreau and GEICO filed a crossclaim against AGCS, alleging that AGCS's policy provided coverage to Boudreau for Extreme Fishing's use of St. Clair's vessel.⁵¹ On September 5, 2018, AGCS filed a crossclaim against GEICO, asserting that Extreme Fishing is entitled to coverage under GEICO's policy as the bareboat charterer of the M/V Super Strike , and that AGCS is the excess insurer and entitled to reimbursement from GEICO for all defense costs incurred to date related to the defense of Extreme Fishing.⁵² In granting AGCS leave to file its crossclaim against GEICO, the Court noted that it was not then deciding whether AGCS had standing to assert the claim.⁵³

A. The AGCS Policy

It is undisputed that Wetzel carried an insurance policy issued by AGCS for the M/V Kingfish that was in effect on the date of the collision.⁵⁴ The policy defines the term "insured" to include "persons or organizations using the Watercraft with [Wetzel's] prior permission."⁵⁵ The AGCS policy provides additional coverage for a "temporary substitute watercraft" as follows:

2. Temporary Substitute Watercraft – If your Watercraft is out of normal use because of a covered loss, we will cover damages you are legally obligated to pay for bodily injury or property damage arising from the maintenance, use, or control of a temporary substitute Watercraft. The temporary substitute Watercraft must be of a similar type, value, and length as the Watercraft that is out of normal use. But we do not cover temporary substitute Watercraft being used for any purpose other than replacing your Watercraft while it is out of normal use due to a covered loss.⁵⁶

Based upon the foregoing provisions and the allegations of Plaintiffs' complaint against Boudreau, the Court previously determined that AGCS has a duty to defend Boudreau.⁵⁷

In the section entitled "General Rules and Conditions," the AGCS policy lists several duties of the insured purporting to be preconditions to coverage,⁵⁸ including the insured's obligations to report to the insurer any loss or damage within 48 hours after arrival in port, provide notice in writing of the claim within 60 days of the occurrence, and make the watercraft and other damaged property available for AGCS's inspection when reasonably required by AGCS.⁵⁹ The AGCS policy also contains an "other insurance" clause that states: "If, at the time of a covered loss or damage, there is any other insurance that would apply to the property in the absence of this policy, the insurance under this policy will only apply as excess insurance over the other insurance."⁶⁰

B. The GEICO Policy

It is also undisputed that St. Clair carried an insurance policy issued by GEICO for the M/V Super Strike that was in effect on the date of the collision.⁶¹ The GEICO policy provides coverage for a bareboat charterer as follows:

While the Insured Boat is under Charter Use , then "you" , "your" , "insured" , and

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