Steuart Transp. Co. v. Allied Towing Corp., s. 77-2426

• Decision Date: 10 April 1979
• Docket Number: 77-2427,Nos. 77-2426,s. 77-2426
• Citation: 596 F.2d 609
• Parties: , 9 Envtl. L. Rep. 20,237 STEUART TRANSPORTATION COMPANY, Appellant, v. ALLIED TOWING CORPORATION, in personam, and its TUG FALCON, in rem, Commonwealth of Virginia (State Water Control Board), United States of America, Appellees, Amoco Oil Company, and Winfred E. Sutton, Sr., Defendants. STEUART TRANSPORTATION COMPANY, Appellee, v. UNITED STATES of America, Appellant, Allied Towing Corporation, in personam, and its Tug Falcon, in rem, Commonwealth of Virginia (State Water Control Board), Amoco Oil Company, and Winfred E. Sutton, Defendants.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 609

596 F.2d 609

12 ERC 2035, 9 Envtl. L. Rep. 20,237

STEUART TRANSPORTATION COMPANY, Appellant, v. ALLIED TOWING CORPORATION, in personam, and its TUG FALCON,

in rem, Commonwealth of Virginia (State Water

Control Board), United States of

America, Appellees,

Amoco Oil Company, and Winfred E. Sutton, Sr., Defendants.

STEUART TRANSPORTATION COMPANY, Appellee, v. UNITED STATES of America, Appellant,

Allied Towing Corporation, in personam, and its Tug Falcon,

in rem, Commonwealth of Virginia (State Water

Control Board), Amoco Oil Company, and

Winfred E. Sutton, Defendants.

Nos. 77-2426, 77-2427.

United States Court of Appeals Fourth Circuit.

Argued Nov. 14, 1978.

Decided April 10, 1979.

Robert M. Hughes, III, Philip N. Davey, Norfolk, Va. (Michael F. Leban, Seawell, McCoy, Dalton, Hughes, Gore & Timms, Norfolk, Va., on brief), for Steuart Transp. Co.

Morton H. Clark, Norfolk, Va. (G. William Birkhead, Carter T. Gunn, Vandeventer, Black, Meredith & Martin, Norfolk, Va., on brief), for Allied Towing Corp.

Timothy G. Hayes, Asst. Atty. Gen., Richmond, Va. (Marshall Coleman, Atty. Gen. of Virginia and David E. Evans, Asst. Atty. Gen., Richmond, Va., on brief), for Commonwealth of Virginia.

Allen Van Emmerik, Atty., Dept. of Justice, Washington, D. C. (Barbara Allen Babcock, Asst. Atty. Gen., Washington, D. C., William B. Cummings, U. S. Atty., Alexandria, Va., Leonard Schaitman, Atty., Dept. of Justice, Washington, D. C., on brief), for United States of America.

David R. Owen, President, Nicholas J. Healy, Chairman, Committee on Uniformity of United States Maritime Law on brief, for amicus curiae The Maritime Law Ass'n of the United States.

Francis B. Burch, Atty. Gen. of Maryland, Baltimore, Md., Edward F. Lawson, Asst. Atty. Gen., State of Maryland, John B. Griffith, Asst. Atty. Gen., Dept. of Natural Resources, Annapolis, Md., Joseph E. Brennan, Atty. Gen. of Maine, Augusta, Maine, Louis J. Lefkowitz, Atty. Gen. of New York, New York City, Robert L. Shevin, Atty. Gen. of Florida, Tallahassee, Fla., Rufus L. Edmisten, Atty. Gen. of North Carolina, Raleigh, N. C., on brief), for States of Maryland, Maine, New York, Florida and North Carolina as amici curiae.

Before BUTZNER, WIDENER and PHILLIPS, Circuit Judges.

BUTZNER, Circuit Judge:

Steuart Transportation Company and the United States appeal a judgment entered in the liability phase of a bifurcated trial on Steuart's petition for limitation of liability arising from an oil spill out of Steuart's tank barge STC-101. We hold that (1) Steuart cannot claim contribution from the tug that was towing the barge at the time of the accident, (2) Steuart can secure limitation of liability under the Federal Water Pollution Control Act against oil pollution removal costs claimed by the United States, ¹ (3) the United States cannot recover removal costs through causes of action for nuisance, maritime tort, and violation of the Rivers and Harbors Act of 1899, (4) Steuart cannot offset its pollution containment expenses against its liability to the United States, and (5) Steuart is liable to the Commonwealth of Virginia for all pollution removal expenses claimed under the state's oil pollution control statute. We therefore affirm the judgment of the district court.

I

On the afternoon of February 1, 1976, Steuart's barge, carrying a full cargo of oil, departed Yorktown, Virginia, in tow of Allied Towing Corporation's tug FALCON. The flotilla encountered falling barometric readings and small craft advisories from the National Weather Service as it proceeded up the Chesapeake Bay, but the tug did not seek haven when it passed the mouth of the Rappahannock River at 10:50 p. m. Heavy snow set in during the early morning of February 2, and the tug lost sight of the barge. When visibility improved at about 6:00 a. m., the tug observed that the barge had sunk by her stern.

The sinking released oil from the barge's cargo in a quantity stipulated to be unlawful under both federal and Virginia pollution control statutes. At Coast Guard direction, Steuart spent about $40,000 in preliminary containment operations. Spillage later appeared in areas away from the immediate scene of the accident, and the Coast Guard directed an extensive removal operation which cost the United States about $480,000 and the Commonwealth of Virginia about $41,000.

The district court found that the barge sank because she shipped water. Badly deteriorated flanges securing a ventilator cowling on the deck broke during the storm, permitting seas to fill the pump room at the stern of the vessel. Steuart's failure to remove scupper plugs from the spill rail of the cargo hatches also allowed the railing to capture sea water. The court concluded that mishandling of the scupper plugs and failure to inspect the deck fittings constituted negligence within Steuart's privity and knowledge and denied Steuart limitation under the Limitation of Liability Act (Limitation Act), 46 U.S.C. § 183(a). Dismissing Steuart's counterclaims against the tug and others, the court allowed all claims against Steuart with the exception of the United States' claim for oil pollution removal costs in excess of the prevailing liability limits imposed by the Federal Water Pollution Control Act (Pollution Act), 33 U.S.C. § 1321(f)(1). ²

Steuart appeals on three grounds. First, although Steuart accepts denial of its limitation petition, it contends that Allied Towing should share liability for the oil spill because the tug's negligence contributed to the accident. Second, Steuart seeks to offset the containment expenses it incurred at Coast Guard direction against the pollution removal costs claimed by the United States under the Pollution Act. Third, Steuart urges us to disallow Virginia's claim for the cost of oil removal because the state statute on which the claim is based has been preempted by the federal act.

The United States appeals in an effort to preserve claims for about $360,000 in removal costs that were disallowed by the district court. The United States argues that the Pollution Act's liability limit does not apply in this case because Steuart's negligence was willful within the meaning of the statute, 33 U.S.C. s1321 (f)(1). Even if Steuart's negligence was not willful, continues the government, the United States should be allowed to recover expenses in excess of the Act's limit through other causes of action.

II

We turn first to the question of the tug's negligence. Steuart contends that falling barometric readings and National Weather Service forecasts available to the tug captain on February 1 would have caused a reasonable mariner in the captain's position to take refuge in the Rappahannock River. Therefore, Steuart argues, the tug is partly responsible for the oil spill that occurred during the storm in the Chesapeake Bay.

The district court found that the weather predicted and actually encountered was never more severe than the conditions both tug and barge were designed to withstand. That finding is not clearly erroneous. We therefore conclude that the tug's failure to seek haven was neither negligent nor a proximate cause of the oil spill. Had the barge been seaworthy, she would not have sunk. Steuart alone is at fault for the accident.

III

We next consider whether the United States is entitled to recover its full removal costs on the ground that Steuart was guilty of willful negligence within the meaning of the Pollution Act. Under the Limitation Act, a shipowner cannot limit its liability unless it shows that the loss was not caused by negligence within its "privity or knowledge." 46 U.S.C. § 183(a). ³ The Pollution Act, however, allows limitation against oil pollution removal costs incurred by the United States unless the government can show that the discharge was due to "willful negligence or willful misconduct within the privity and knowledge of the owner." 33 U.S.C. § 1321(f)(l). Although the element of "privity and knowledge" in each act is identical, the degree of negligence that will preclude limitation of liability differs. Thus, a negligent shipowner denied relief under the Limitation Act may nevertheless secure limitation against the United States' claim for removal costs under the Pollution Act unless its negligence or misconduct was willful.

The legislative history of the Pollution Act reenforces its plain meaning. Drawn from the Water Quality Improvement Act of 1970 (Water Act), Pub.L. 91-224, § 102, 84 Stat. 91 (formerly codified at 33 U.S.C. § 1161), the language of the liability standard represents a compromise between the Senate and the House. The House proposed an oil pollution statute with liability based on fault and an absolute limitation on recoverable removal costs. H.R. 4148, 91st Cong., 1st Sess. § 2 (1969); See H.R.Rep. No. 91-127, 91st Cong., 1st Sess. 11 (1969), Reprinted in (1970) U.S.Code Cong. & Admin.News, pp. 2691, 2701-02. The Senate favored strict liability within maximum limits, subject to four defenses, and unlimited liability for negligent or willful oil discharges. S. 7, 91st Cong., 1st Sess. § 102 (1969); See S.Rep. No. 91-351, 91st Cong., 1st Sess. 17-18 (1969). The final bill embodied the Senate's strict liability proposal, but imposed unlimited liability only in cases where the government could show willful negligence or willful misconduct within the privity and knowledge of the shipowner. See H.R.Conf.Rep. No. 91-940, 91st Cong., 2d Sess. 39, Reprinted in (1970) U.S.Code Cong. & Admin.News, pp. 2712, 2724; Healy and Paulsen, Marine Oil Pollution and the Water Quality Improvement Act of 1970, 1 J.Mar.L. & Com. 537, 558-61 (1970).

As we already mentioned, the district court found that Steuart's haphazard inspection practices constituted ordinary negligence within Steuart's privity and knowledge and therefore denied relief under the Limitation Act. The court concluded, however, that the negligence was not willful, and it limited the United States's oil...