Investigation of Marine Casualties – Rights of Parties in Interest

Flickr Coast Guard InvestigationWhen a marine casualty occurs the U.S. Coast Guard is empowered to conduct an investigation to determine “as closely as possible” the cause of the casualty, cause of any death, whether an act of misconduct, incompetence, negligence, unskillfulness, or willful violation of law committed by any licensed or certified individual or member of the Coast Guard contributed to the cause of the casualty, whether there is evidence that an act subjecting the offender to a civil or criminal penalty has been committed and whether there is a need for new laws or regulations, or amendment or appeal of existing laws or regulations. 46 U.S.C. 6301.

But what about the rights of the parties to the casualty? What is the extent of their participation in the investigation?  46 U.S.C. 6303 provides that in such an investigation parties in interest (PII) shall be allowed to be represented by counsel, cross-examine and call witnesses.  PIIs include an owner, any holder of a license or certificate of registry, holder of a merchant mariner’s document, any person whose conduct is under investigation, and any other party in interest.  This has been expanded to include any person who the USCG finds to have a “direct interest” into the investigation.  However, in practice these guidelines do not provide much relief to the owner of a subject vessel when on-the-scene interviews and inspections by the Coast Guard are underway in the immediate wake of a significant marine casualty.  The degree that the PII could actively participate and be privy to interviews, statements and other discovered evidence was largely dependent upon the discretion of the investigating officers.

In 2010, in response to industry calls for more active participation, inclusion and transparency, the Coast Guard issued CG-545 Policy Letter 3-10. In it the Coast Guard made clear that PIIs have the right to participate in “all levels of investigation”, not just formal hearings.  This is important.  The PII has the right to immediate participation.  This includes the right to be present during interviews of all witnesses (not just those of its own crew or employees), to be present during on-scene inspections, to present evidence to the Coast Guard and request that particular witnesses be interviewed.

To be clear, however, the Policy Letter mandates that the Marine Board of Investigation or Investigating Officer (IO) are in charge of all aspects of the investigation. In order for an interested party to participate it must be recognized by the Board or IO as a PII.  The IO has the prerogative to formally designate PIIs during the course of the investigation.  But the party that believes it is a stakeholder in the casualty is best served by making formal application with the IO to be designated as a PII.  When application is made the IO must give it due consideration.  If the applicant meets the criteria found in Part 6303 and Part 2 of the Policy Letter it “shall” be given PII status.  The request for PII recognition may be made verbally, but needs to be followed in writing within 24 hours.  The IO’s initial designation may be verbal, but needs to be made in writing by the IO within 5 business days of receipt of the written request for PII designation.

The stakeholder needs to know that the IO is not required to designate PIIs. It is incumbent on the stakeholder to act early and promptly to contact the IO and make clear that it seeks PII status.  The IO is required to notify the PII when witnesses will be interviewed, but is not obligated to accommodate the schedule of the PII.  If the PII provides a witness the IO shall determine if the witness is relevant to the investigation.  If the IO finds that the witness is not relevant, the witness will not be interviewed.

During interviews the IO is in charge. When the IO has completed his portion of the interview, the PII then may ask questions.  The IO is empowered to determine if the questions the PII asks are relevant.  If he finds that a question is not relevant it will not be allowed and the witness informed not to respond.  Part 4e of the Letter provides that the rights of the PII apply only to conducting witness interviews.  The IO “may” allow the PII to review any or all evidence gathered during the fact-finding portion of the investigation.  The PII is not allowed to have its own copies (in any form) of any documentation (read: statements) with the exception of the names and work information of the witnesses.  Additionally the IO “may” allow the PII to review the findings of fact portion of the report of investigation, but the PII is prohibited from being involved in the development or review of analysis, conclusions or recommendations for a marine casualty investigation.  As is obvious, while the Policy Letter does provide for active PII participation, it does leave to the IO significant discretion what witness or evidence he will deem worthy of consideration.  Irrespective of this, the PII should take every opportunity to submit witnesses and evidence it believes is favorable to its interests.

While the language in Part 4c restricts access by the PII to third-party documents such as log books, photos, witness statements and other evidence and what witnesses will be deemed relevant, in practice I have found that the on-site Coast Guard investigators more times than not want to work with industry and will share documents, provide access to evidence that is developed, and will accommodate the work schedules of witnesses and company representatives or PIIs.

Excellent Flickr Photo courtesy of Jonathan James.

What to Do When Your Dock is Damaged By a Ship With a Compulsory Pilot on Board

5223924101_a0488c4e25_zPilotage has existed since ancient times and is as necessary and important now to commercial shipping as it was when Roman law set forth the obligation on the part of the vessel to take a pilot.  A pilot is employed because he is presumed to have knowledge of tides, currents, and their effect upon the ship and all other dangers affecting the safety of the vessel due to local conditions.  In the United States, compulsory pilotage laws pre-date the Revolution.  Early on, Congress recognized that it would be wiser to leave regulation of local pilotage grounds to the individual states.

What happens, however, if a foreign ship carrying a compulsory pilot allides with your dock and causes damage?  Who is responsible—the ship, its master, or the pilot?  What should you, as dock owner, do?

The reason that a vessel employs a pilot, whether compulsory or voluntary, is in large measure because such an individual is expected to have expert local knowledge of the navigable waterways.  He is charged with knowledge and awareness of local conditions, including both published obstacles and dangers not evident on charts or from outward appearances.  The courts have found that pilots may be charged with knowledge of a local condition as a matter of law.  As a result, the courts have consistently come to the conclusion that a pilot may be held individually liable for damage caused by his negligent navigation to the vessel which he is piloting or to third parties which is the result of his failure to exercise due care.

Although a pilot might be regarded as an independent contractor as respects the ship he is aboard and its owners, he is at all times subject to the ultimate control of the ship’s master.  Even though the pilot is deemed to be an expert in navigation of vessels that he guides over his pilotage grounds, the master of the vessel is still in command of the vessel and must, under appropriate circumstances, intervene, interfere, warn or even take over and relieve the pilot.  This duty arises if the master of the vessel observes or discovers incompetency of the pilot or it becomes manifest that the pilot is steering the vessel into danger.  Thus, the courts have required the master to carefully observe and monitor the actions of the pilot.

When damage occurs, the prudent dock owner must move quickly, especially when the offending vessel flies a foreign flag.  While you may be able to procure jurisdiction over the pilot and, if he is found liable, have judgment rendered against him, this remedy may be mere delusion as he will likely not be able to respond to such a judgment.  You may be left with no remedy if the vessel leaves port.

Consequently, the dock owner should look to relief provided by Supplemental Admiralty Rules B and C found in the Federal Rules of Civil Procedure.  These rules provide for attachment and seizure, respectively, of the vessel.

Rule C addresses seizure, which allows anyone with a maritime lien against a vessel to arrest the vessel and proceed against it in a so-called in rem action.  The in rem action is based on the fiction of the personality of the vessel.  When the vessel allided with your dock, the damage it caused immediately gave rise to a maritime lien.  In the in rem action, you proceed against the vessel itself, called the res, to satisfy that lien.  Rule B, on the other hand, addresses attachment, a procedure in which the property of the vessel owner is held in order to compel the owner to submit to the personal jurisdiction of the court, and in order to provide a fund from which any judgment against the owner may be satisfied.  Any property of the owner which can be found in the district, not just the offending vessel, is subject to attachment under Rule B.

By seizing the vessel, the dock owner has security to cover his damages. The vessel owner may post security to cover the dock owner’s claim and the vessel can be released. Mere threat of seizure often results in security being posted, by way of a bond or letter of undertaking from the vessel’s insurer.

At the same time, the dock owner should move the court to require the key members of the vessel’s crew to give their depositions for perpetuation.

In sum, if the vessel owner does not agree to come forward and post security, the dock owner must arrest and/or attach the vessel and proceed both in rem against the vessel and in personam against the owner.  If the owner agrees to post security for the value of the claim, the security can be substituted for the vessel, allowing its release, and providing a fund for the satisfaction of any judgment from the claim.  On motion, the court may require the crew to be deposed or other discovery taken within a given period of time, although if they have already departed, arranging for their transportation may be the plaintiff’s responsibility.

Rules B and C of the Federal Rules of Civil Procedure allow a party aggrieved by a foreign vessel to force the tortfeasor into court by seizing the offending vessel (or, in the case of attachment, another vessel of the same owner), although recovery may well be limited to the value of the vessel.  By acting quickly to arrest and attach the offending vessel, the dock owner can protect himself from damage caused even by a foreign vessel under compulsory p­­ilotage.

Image courtesy of Flickr.

Marine Safety Alerts

On October 9, 2014 the U.S. Coast Guard issued two Marine Safety Alerts that are of particular interest to barge fleeting, terminals and repair facilities situated on the navigable waters of our state. These Alerts do not break new ground, but are worthy of review.

Safety Alert 11-14 addresses barge fleet lighting. The Coast Guard reminds industry that in the last 12 years there have been at least 44 collisions by recreational vessels with moored barges that have resulted in 26 fatalities and 44 injuries in the Eight District, which includes the Mississippi River and its tributaries. Lighting of the moored barges was a factor in most of these casualties. The intent of the Alert is to not only to remind fleet and terminal operators of the importance and necessity of proper, sufficient lighting, but to remind boaters of the dangers present when operating near and around barge fleets.

Rule 30 of the Inland Rules of the Road, “Anchored Vessels and Vessels Aground”, was amended in July of this year to incorporate barge lighting requirements that were previously found in other regulations. Part (h) requires that barges projecting into a buoyed or restricted channel, any barge moored so that it reduces a navigable channel to less than 80 meters (263 ft.), barges moored in groups of two or more wide, and every barge not moored parallel to a dock or the bank must carry two unobstructed all around white lights of an intensity to be visible for at least one nautical mile. Part (j) requires that such lights be placed on the outboard corners or extremities of single and groups of barges so as to mark their perimeters.

That these requirements are clearly spelled out in the Rule has significance from a legal liability perspective. In the general maritime law, the alleged violator of a statutory rule intended to prevent marine casualties is presumed at fault and the burden is on the alleged violator to prove not only that its violation was not a contributing cause of the casualty, but that it could not have been a cause. This is a heavy burden to carry. Diligent adherence to these regulations is a must.

Safety Alert 10-14 speaks to preventing barge explosions. This alert was issued in response to recent casualties from explosions aboard barges in tank cleaning, stripping and gas-freeing operations. The Coast Guard’s review of such events has shown that their cause is typically not limited to one party, but by the combined lapses on the part of vessel personnel, facility personnel and shoreside managers.

Those in the industry are well aware that the Coast Guard requires each such facility to have in place Operations Manuals. 33 CFR §154.300, 310, et. seq., sets forth in detail the necessary contents of the Manual. The list is lengthy, but essentially must set out the business of the facility, types of vessels and cargo being worked and handled, operating procedures and emergency response protocols. Each facility must have a Manual approved by the Captain of the Port. Having found that the most common causal factor associated with tank barge explosions is the failure to follow key Operating Manual procedures, the Coast Guard expects strict compliance.

The Alert reminds operators to ensure that personnel are thoroughly trained and credentialed, proper ventilation be in effect, that the barge/vessel is properly grounded and that spark-producing equipment be removed, prohibit vessels operating nearby so as to avoid the introduction of a source of vapor ignition, and the barge/vessel be certified safe by a Certified Marine Chemist before any hot work is conducted or closed spaces entered.

Much of what is contained in these Alerts may be self-evident to those who are engaged daily in these practices. However, being familiar with a practice is no guarantee that the persons engaged will not start taking for granted that procedures are being followed. An isolated lapse can lead to serious injury and property damage. Thus, reminders such as these Alerts help to insure that all personnel remain vigilant.

These Marine Safety Alerts may be found by visiting the U.S. Coast Guard 8th District website, www.uscg.mil/d8/.

Punitive Damages Not Recoverable

In 1990, the U.S. Supreme Court held that a seaman who brings a claim for personal injury against his employer pursuant to the Jones Act for negligence, or under the general maritime law for unseaworthiness of the vessel, is not entitled to recover punitive damages.  (Miles v. Apex Marine Corp., 489 U.S. 19 (1990)).  Employers and insurers embraced the decision, and for close to twenty years the maritime community thought the matter was settled.  However, in the last eight to ten years this prohibition has been increasingly challenged by plaintiffs’ attorneys in courts across the country.  As a consequence there have been some judges who have held that the injured seaman may, in the appropriate circumstances, recover punitive damages for the employer’s willful, wanton and capricious refusal to pay maintenance and cure, and for gross disregard of its obligation to provide the seaman with a seaworthy vessel.  But there has been no consistency between the courts in their rulings, resulting in uncertainty.

On September 25, 2014 the Fifth Circuit Court of Appeals added its voice to the fray in the matter of McBride v. Estis Well Service, L.L.C. (Case:12-30714).  This case’s odyssey to the Court of Appeals began when a truck-mounted drilling rig, part of a barge owned by Estis, toppled over. One crew member was killed, three others injured.  Lawsuits were filed on behalf of each.  Each prayed for recovery of punitive damages.  Estis moved for dismissal of the punitive damage claims as not being recoverable as a matter of law. The federal District Court in Lafayette granted the Motion and held that punitive damages are not available to the injured seaman for unseaworthiness, and that his recovery is limited to pecuniary losses.  The decision was based, in part, on the theory that since Congress had included in the Jones Act (the law that provides the seaman with a remedy against his employer) the prohibition of recovery of punitive damages, the principle of uniformity dictated that the courts should not expand the seaman’s rights of recovery.  The plaintiffs appealed to the Fifth Circuit.

On October 2, 2013 the Court of Appeals reversed the District Court and held that punitive damages may be recovered by the seaman injured due to an unseaworthy condition of the vessel which is the consequence of the employer’s gross breach of its duty to provide a seaworthy vessel. In its lengthy decision, the three-judge panel essentially held that because the seaman’s right to recover punitive damages under the general maritime law was well-established prior to the enactment of the Jones Act, and because the Jones Act does not address unseaworthiness or limit its remedies, the crew of the Estis barge would be entitled to maintain their punitive damage claim.

Estis applied for a re-hearing and on February 24, 2014 the Court of Appeals ordered re-hearing before the entire Court.  This time the Court saw matters in a different light and reversed its earlier ruling.  Judge Davis, writing for the Court, ruled that the historical judicial and legislative record suggested that when the Jones Act limits the seaman’s recovery to pecuniary damages and prohibits recovery of punitive damages the “seaman may not use a general maritime claim to recover damages that would be unavailable under the Jones Act”.  Judge Davis went on to note that “on the subject of recoverable damages in a wrongful death case under the Jones Act and general maritime law, [the Supreme Court] has limited the survivor’s recovery to pecuniary losses” and that these plaintiffs suggested no reason why this analysis would not also apply to their asserting claims for personal injury.  Because punitive damages are designed to punish the wrongdoer and not to compensate the victim, by definition are not pecuniary losses.

But, chances are that this is not the end of this debate.  The plaintiffs will likely appeal to the higher court.  The decision written by Judge Davis was fifteen pages long; the dissent authored by Judge Higginson, and joined by five of his colleagues, measures thirty-seven pages.  Expect this issue to be the center of attention of other appellate courts resulting in contradictory decisions which will again draw the attention of the U.S. Supreme Court.  However, for the time being, at least within the venue of the Fifth Circuit Court of Appeals the seaman cannot recover punitive damages.