United States v. Slade, Inc., B-76-410-CA.

• Court: U.S. District Court — Eastern District of Texas
• Writing for the Court: STEGER
• Citation: United States v. Slade, Inc., 447 F.Supp. 638 (E.D. Tex. 1978)
• Decision Date: 17 February 1978
• Docket Number: No. B-76-410-CA.,B-76-410-CA.
• Parties: UNITED STATES of America v. SLADE, INC. and Water Quality Insurance Syndicate, in personam, and the TANKER BARGE S-1511, Official Number 512033, in rem.

447 F. Supp. 638

UNITED STATES of America v. SLADE, INC. and Water Quality Insurance Syndicate, in personam, and the TANKER BARGE S-1511, Official Number 512033, in rem.

No. B-76-410-CA.

United States District Court, E. D. Texas, Beaumont Division.

February 17, 1978.

John T. Shepherd, Trial Atty., Admiralty & Shipping Section, Dept. of Justice, Washington, D. C., for United States.

George E. Duncan, Wells, Peyton, Duncan, Beard, Greenberg & Hunt, Beaumont, Tex., for defendant.

FINDINGS OF FACT AND CONCLUSIONS OF LAW

STATEMENT OF THE CASE

STEGER, District Judge.

This admiralty action was brought by the United States of America for the recovery of $13,044.04 in Government funds expended in cleaning up an oil spill from the Sabine River on or about October 29, 1973. The Government contends that the spill emanated from a ruptured cargo tank in defendant Slade, Inc.'s ("Slade," hereinafter) tanker barge S-1511 which arrived in the Port of Orange, Texas, in tow of the M/V EDGAR BROWN III, also owned and operated by Slade, at approximately 8:00 p. m., October 28, 1973. The voyage originated in Gibson, Louisiana, where the S-1511 and its companion barge HTCO-43 loaded a cargo of crude oil a few days earlier.

Venue and jurisdiction are proper, the United States suing pursuant to 28 U.S.C. § 1345, and the Water Pollution Prevention and Control Act, 33 U.S.C. § 1251, et seq., specifically, that portion of the Federal Water Pollution Control Act (FWPCA), as amended, 33 U.S.C. § 1321 (1972). The Government also sues to recover a statutory penalty of $3,500.00 assessed against Slade for its violation of the FWPCA.

Slade contends the spill cleaned up by the Government was not discharged from the S-1511; and further, that it was denied due process of law in the Coast Guard's assessment of the penalty.

Most of the essential facts were stipulated by the parties, the threshold question left for resolution by the Court being the source of the spill. This depended on the consideration of much conflicting technical evidence, which, because of the importance of the novel scientific issue involved, will be dealt with in some detail.

In short, the Court finds the spill was discharged from defendant's S-1511 entitling the Government to recover its actual cleanup costs; and further, that defendants were not deprived of due process of law in the matter of the Coast Guard's assessment of the $3,500.00 statutory penalty which the Government is also entitled to recover.

I. FINDINGS OF FACT

A. THE STIPULATED FACTS

The following facts were stipulated to, having been established by the pleadings, interrogatories and admissions of counsel:

1. This cause of action arose within the Eastern District of Texas.

2. Defendant, Slade, at all pertinent times, was, and now is, a Delaware Corporation, with principal offices and place of business located at Orange, Orange County, Texas. It is engaged in the business of waterborne transportation of petroleum and petroleum products.

3. Slade, at all pertinent times, was the owner and/or operator of the T/B S-1511 and T/B HTCO No. 43 and the M/V EDGAR BROWN III. T/B S-1511, Official Number 512033, is a non self-propelled tanker barge of 868 gross tons of single hull construction.

4. Water Quality Insurance Syndicate (WQIS), was, at all pertinent times, the insurer of Slade.

5. On or about October 27, 1973, while in the tow of M/V EDGAR BROWN III, the T/B S-1511 collided with an unidentified submerged object in the vicinity of Mile 117 of the Gulf Intracoastal Waterway, sustaining certain damage to her hull, specifically a hole in her No. 1 starboard cargo tank.

6. Sometime during the morning of October 27, 1973, the M/V EDGAR BROWN III reported to Slade that she had sustained an underwater oil leak in Barge T/B S-1511.

7. At the time of her collision with the unidentified submerged object, the T/B S-1511 and T/B HTCO No. 43 were transporting a cargo of oil, a quantity of which was then being carried in the No. 1 starboard tank of T/B S-1511.

8. At all pertinent times, Mr. Melvin Joseph Hebert was the Relief Captain of the M/V EDGAR BROWN III, and as such was an employee of Slade and then acting within the course and scope of his employment.

9. The M/V EDGAR BROWN III and her tow moored in the Port of Orange at approximately 8:00 p. m., on October 28, 1973.

10. After mooring at Orange, a quantity of oil was transferred from the Number 1 starboard tank of the T/B S-1511 to the T/B S-1512, the transfer operation being under the control of Slade employees.

11. The T/B S-1511 remained at her Orange mooring from October 28, 1973, until on or about November 10, 1973, at which time she was towed to the Crown Central Petroleum facility, near Houston, Texas.

12. On or about November 14, 1973, the T/B S-1511 was drydocked at the facilities of the Levingston Shipbuilding Company, Orange, Texas.

13. No hull repairs and/or damage inspection were effected on the T/B S-1511 during the interval from her underwater collision until after her drydocking at the Levingston facility.

14. On or about 9:25 a. m. local time, October 29, 1973, Mr. G. W. Bennett, Harbor Master, Orange, Texas, notified the U. S. Coast Guard Captain of the Port, Sabine, Texas, that an estimated five (5) barrels of crude oil had accumulated on the water at the South end of the Port of Orange, "from an unknown source."

15. Shortly thereafter, Coast Guard personnel commenced an investigation of the oil spill.

16. The Sabine River at all pertinent locations is navigable in fact by reason of its sustenance of heavy barge and other maritime traffic.

17. Coast Guard investigators obtained samples of the oil polluting the Sabine River at the following times and places:

    Date and Time           Location
                (a) 10:35 a.m.,         Sabine River, Port of
                    October 29, 1973    Orange, Texas
                (b) 3:20 p.m.,          DuPont Cut
                    October 29, 1973    Sabine River
                (c) 3:40 p.m.,          Old Cow Bayou
                    October 29, 1973    Sabine River
                (d) 10:05 a.m.,         200 feet from Light
                    October 30, 1973    No. 5, Sabine River
                

18. Coast Guard investigators obtained samples of oil from the following barges at the times indicated:

(a) 2:10 p.m.,          No. 1 starboard tank
                    October 29, 1973    T/B S-1511
                (b) 2:15 p.m.,          No. 4 port tank
                    October 29, 1973    T/B S-1512
                

19. On or about November 6, 1973, the aforesaid six (6) samples were mailed by the U. S. Coast Guard to, and received by, the Environmental Protection Agency (EPA), Chemical Laboratory, Houston, Texas facility, where certain chemical and physical tests were performed on them shortly thereafter.

20. On or about October 29, and 30, 1973, Slade, Inc. caused certain oil spill cleanup services to be performed on its behalf by Renner, Inc., of Port Arthur, Texas, in the vicinity of T/B S-1511's moorings in the Port of Orange, for which services it paid Renner, Inc. the sum of $231.75.

21. Slade, Inc. did not clean up, or cause to be cleaned up, the oil observed by Coast Guard investigators in the vicinity of the intersection of the Sabine River and Cow Bayou, and other parts of the Sabine River.

22. On or about October 29, 1973, pursuant to contract No. DOT-DG8-6413, Project No. 140030, the U. S. Coast Guard engaged the services of Renner, Inc., who, during the interval of October 29, 1973 to November 8, 1973, contained and cleaned up a quantity of oil from the Sabine River.

23. For its cleanup services, aforesaid, Renner, Inc. was paid the sum of $12,456.50 of Government funds by the U. S. Coast Guard.

24. In addition to the Renner payment, the U. S. Coast Guard accumulated other personnel and material costs in the amount of $587.54, thereby accumulating total cleanup costs in the amount of $13,044.04.

25. Pursuant to its Letter Serial 5890, dated February 18, 1975, the Coast Guard demanded of Slade payment in the amount of $13,044.04, but such payment was not made, and has not since been made by Slade, nor by anyone on its behalf.

26. Pursuant to its Letter Serial No. 5890, dated April 16, 1975, to Slade, the Coast Guard repeated its demand for payment, but to no avail.

27. Pursuant to its Letter Serial No. 5890, dated June 30, 1975, to Water Quality Insurance Syndicate, Inc., the Coast Guard repeated its demand for payment, originally made to Slade, but to no avail.

28. Pursuant to its Letter Serial No. 8-3907-73/p-R, dated February 1, 1974, the U. S. Coast Guard notified Slade of its intention to assess, by the authority of 33 U.S.C. § 1321(b)(6), a civil penalty of $5,000.00, for the discharge of a harmful quantity of oil into the navigable waters of the United States. This letter advised Slade, among other things, of its right to an informal hearing, at which its evidence and any other arguments would be heard prior to any formal Coast Guard decision regarding the penalty or that Slade could in lieu of a hearing, furnish the Coast Guard a statement setting forth all facts favorable to it, bearing upon the facts of the case.

29. By its letter dated February 16, 1974, Slade denied, among other things, that the alleged pollution had been caused by discharge from its Barge T/B S-1511, and responded by pointing out that samples had been taken of the oil found at the confluence of Cow Bayou and the Sabine River and that the same did not match the samples taken from Barges S-1511 and 1512.

30. By its Letter Serial No. 8-3907-73/p dated April 24, 1974, the Coast Guard formally assessed a civil penalty in the amount of $3,500.00 against Slade and advised Slade of its right to appeal the same to the Commandant, U. S. Coast Guard, Washington, D. C.

31. By its letter dated June 7, 1974, to the Commander, Eighth Coast Guard District, Slade formally appealed the civil penalty of $3,500.00.

32. By its letter Serial No. 5830/5-8, dated April 8, 1975, Slade, Inc.'s appeal was denied by the Commandant, U. S. Coast Guard, and Slade was informed that unless...