Jerome B. Grubart v. Great Lakes Dredge & Dock

• Citation: 513 U.S. 527,115 S.Ct. 1043,130 L.Ed.2d 1024
• Decision Date: 22 February 1995
• Docket Number: 93762
• Parties: JEROME B. GRUBART, INC., Petitioner, v. GREAT LAKES DREDGE & DOCK COMPANY et al. CITY OF CHICAGO, Petitioner, v. GREAT LAKES DREDGE & DOCK COMPANY et al
• Court: United States Supreme Court

513 U.S. 527

115 S.Ct. 1043

130 L.Ed.2d 1024

JEROME B. GRUBART, INC., Petitioner,

v GREAT LAKES DREDGE & DOCK COMPANY et al.

CITY OF CHICAGO, Petitioner,

v. GREAT LAKES DREDGE & DOCK COMPANY et al.

Nos. 93-762, 93-1094.

Supreme Court of the United States

Argued Oct. 12, 1994.

Decided Feb. 22, 1995.

Syllabus ^*

After the Chicago River flooded a freight tunnel under the river and the basements of numerous buildings, petitioner corporation and other victims brought tort actions in state court against respondent Great Lakes Dredge & Dock Co. and petitioner Chicago. They claimed that in the course of driving piles from a barge into the river bed months earlier, Great Lakes had negligently weakened the tunnel, which had been improperly maintained by the city. Great Lakes then filed this action, invoking federal admiralty jurisdiction and seeking, inter alia, the protection of the Limitation of Vessel Owner's Liability Act. That Act would permit the admiralty court to decide whether Great Lakes had committed a tort and, if so, to limit its liability to the value of the barges and tug involved if the tort was committed without the privity or knowledge of the vessels' owner. The District Court dismissed the suit for lack of admiralty jurisdiction, but the Court of Appeals reversed.

Held: The District Court has federal admiralty jurisdiction over Great Lakes's Limitation Act suit. Pp. __.

(a) A party seeking to invoke such jurisdiction over a tort claim must satisfy conditions of both location and connection with maritime activity. In applying the location test, a court must determine whether the tort occurred on navigable water or whether injury suffered on land was caused by a vessel on navigable water. 46 U.S.C.App. § 740. In applying the connection test, a court first must assess the "general features of the type of incident involved" to determine if the incident has "a potentially disruptive impact on maritime commerce." Sisson v. Ruby, 497 U.S. 358, 363, 364, n. 2, 110 S.Ct. 2892, 2896, 2896 n. 2, 111 L.Ed.2d 292. If so, the court must determine whether the character of the activity giving rise to the incident shows a substantial relationship to traditional maritime activity. Id., at 365, 364, and n. 2, 110 S.Ct., at 2897, 2897-2898, and n. 2. Pp. 3-6.

(b) The location test is readily satisfied here. The alleged tort was committed on a navigable river, and petitioners do not seriously dispute that Great Lakes's barge is a "vessel" for admiralty tort purposes. There is no need or justification for imposing an additional jurisdictional requirement that the damage done must be close in time and space to the activity that caused it. A nonremoteness requirement is not supported by the Extension of Admiralty Jurisdiction Act's language, and the phrase "caused by" used in that Act indicates that the proper standard is proximate cause. Gutierrez v. Waterman S.S. Corp., 373 U.S. 206, 210, 83 S.Ct. 1185, 1188, 10 L.Ed.2d 297, distinguished. Pp. 6-10.

(c) The maritime connection test is also satisfied here. The incident's "general features" may be described as damage by a vessel in navigable water to an underwater structure. There is little question that this is the kind of incident that has "a potentially disruptive impact on maritime commerce." Damaging the structure could lead to a disruption in the water course itself and, as actually happened here, could lead to restrictions on navigational use during repairs. There is also no question that the activity giving rise to the incident—repair or maintenance work on a navigable waterway performed from a vessel—shows a substantial relationship to traditional maritime activity. Even the assertion that the city's alleged failure to properly maintain and operate the tunnel system was a proximate cause of the flood damage does not take this case out of admiralty. Under Sisson, the substantial relationship test is satisfied when at least one alleged tortfeasor was engaging in activity substantially related to traditional maritime activity and such activity is claimed to have been a proximate cause of the incident. There is no merit to the argument that the activity should be characterized at a hypergeneralized level, such as "repair and maintenance," to eliminate any hint of maritime connection, or to the argument that Sisson is being given too expansive a reading. Pp. 10-16.

(d) There are theoretical, as well as practical, reasons to reject the city's proposed multifactor test for admiralty jurisdiction where most of the victims, and one of the tortfeasors, are land based. The Sisson tests are directed at the same objectives invoked to support a multifactor test, the elimination of admiralty jurisdiction where the rationale for the jurisdiction does not support it. In the Extension Act, Congress has already made a judgment that a land-based victim may properly be subject to admiralty jurisdiction; surely a land-based joint tortfeasor has no claim to supposedly more favorable treatment. Moreover, contrary to the city's position, exercise of admiralty jurisdiction does not result in automatic displacement of state law. A multifactor test would also be hard to apply, jettisoning relative predictability for the open-ended rough-and-tumble of factors, inviting complex argument in a trial court and a virtually inevitable appeal. Pp. 16-21.

3 F.3d 225 (CA 7 1993), affirmed.

SOUTER, J., delivered the opinion of the Court, in which REHNQUIST, C.J., and O'CONNOR, KENNEDY, and GINSBURG, JJ., joined. O'CONNOR, J., filed a concurring opinion. THOMAS, J., filed an opinion concurring in the judgment, in which SCALIA, J., joined. STEVENS and BREYER, JJ., took no part in the decision of the case.

Ben Barnow, for petitioner in No. 93-762.

Lawrence Rosenthal, for petitioner in No. 93-1094.

John G. Roberts, Jr., for respondents.

Justice SOUTER delivered the opinion of the Court.

On April 13, 1992, water from the Chicago River poured into a freight tunnel running under the river and thence into the basements of buildings in the downtown Chicago Loop. Allegedly, the flooding resulted from events several months earlier, when the respondent Great Lakes Dredge and Dock Company had used a crane, sitting on a barge in the river next to a bridge, to drive piles into the river bed above the tunnel. The issue before us is whether a court of the United States has admiralty jurisdiction to determine and limit the extent of Great Lakes's tort liability. We hold the case to be within federal admiralty jurisdiction.

I

The complaint, together with affidavits subject to no objection, alleges the following facts. In 1990, Great Lakes bid on a contract with the petitioner city of Chicago to replace wooden pilings clustered around the piers of several bridges spanning the Chicago River, a navigable waterway within the meaning of The Daniel Ball, 10 Wall. 557, 563, 19 L.Ed. 999 (1871). See Escanaba Co. v. Chicago, 107 U.S. 678, 683, 2 S.Ct. 185, 188-189, 27 L.Ed. 442 (1883). The pilings (called dolphins) keep ships from bumping into the piers and so protect both. After winning the contract, Great Lakes carried out the work with two barges towed by a tug. One barge carried pilings; the other carried a crane that pulled out old pilings and helped drive in new ones.

In August and September 1991, Great Lakes replaced the pilings around the piers projecting into the river and supporting the Kinzie Street Bridge. After towing the crane-carrying barge into position near one of the piers, Great Lakes's employees secured the barge to the river bed with spuds, or long metal legs that project down from the barge and anchor it. The workers then used the crane on the barge to pull up old pilings, stow them on the other barge, and drive new pilings into the river bed around the piers. About seven months later, an eddy formed in the river near the bridge as the collapsing walls or ceiling of a freight tunnel running under the river opened the tunnel to river water, which flowed through to flood buildings in the Loop.

After the flood, many of the victims brought actions in state court against Great Lakes and the city of Chicago, claiming that in the course of replacing the pilings Great Lakes had negligently weakened the tunnel structure, which Chicago (its owner) had not properly maintained. Great Lakes then brought this lawsuit in the United States District Court, invoking federal admiralty jurisdiction. Count I of the complaint seeks the protection of the Limitation of Vessel Owner's Liability Act (Limitation Act), 46 U.S.C.App. § 181 et seq., a statute that would, in effect, permit the admiralty court to decide whether Great Lakes committed a tort and, if so, to limit Great Lakes's liability to the value of the vessels (the tug and two barges) involved if the tort was committed "without the privity or knowledge" of the vessels' owner, 46 U.S.C.App. § 183(a). Counts II and III of Great Lakes's complaint ask for indemnity and contribution from the city for any resulting loss to Great Lakes.

The city, joined by petitioner Jerome B. Grubart, Inc., one of the state-court plaintiffs, filed a motion to dismiss this suit for lack of admiralty jurisdiction. Fed.Rule Civ.Proc. 12(b)(1). The District Court granted the motion, the Seventh Circuit reversed, Great Lakes Dredge & Dock Co. v. Chicago, 3 F.3d 225 (1993), and we granted certiorari, 510 U.S. ----, 114 S.Ct. 1047, 127 L.Ed.2d 370 (1994). We now affirm.

II

The parties do not dispute the Seventh Circuit's conclusion that jurisdiction as to Counts II and III (indemnity and contribution) hinges on jurisdiction over the Count I claim. See 3 F.3d, at 231, n. 9; see also 28 U.S.C. § 1367 (1988 ed., Supp. V) (supplemental jurisdiction); Fed.Rules Civ.Proc. 14(a) and (c) (impleader of third parties). Thus, the issue is simply whether or not a federal admiralty court has jurisdiction over claims that Great Lakes's faulty replacement work caused the flood damage.

A.

A ...