Source: https://openjurist.org/557/f2d/438/university-of-texas-medical-branch-at-galveston-v-united-states
Timestamp: 2017-08-21 12:42:26
Document Index: 246658011

Matched Legal Cases: ['§ 16', '§ 19', '§ 15', '§ 15', '§ 10', '§ 15', '§ 408']

557 F. 2d 438 - University of Texas Medical Branch at Galveston v. United States
557 F2d 438 University of Texas Medical Branch at Galveston v. United States
557 F.2d 438
Complaint of the University of Texas Medical Branch at
Galveston, et al. The UNIVERSITY OF TEXAS MEDICAL
BRANCH AT GALVESTON et al., Plaintiffs-Appellants,
The Court reasoned that the United States was entitled to implied civil remedies because in many cases the combination of the "meager monetary penalties" of § 16 "and the Government's in rem rights (after abandonment and sale pursuant to § 19) would not serve to reimburse the United States for removal expenses." Wyandotte Transportation Co. v. United States, supra, 389 U.S. at 202, 88 S.Ct. at 386. Thus, the government could seek an injunction ordering the negligent owner in one case to remove the vessel because "(d) enial of such a remedy . . . would permit the result, extraordinary in our jurisprudence, of a wrongdoer shifting responsibility for the consequences of his negligence onto his victim." Id. at 204, 88 S.Ct. at 387. Similarly, the government could seek reimbursement of wreck removal costs against the responsible parties in the other case because "(h)aving properly chosen to remove such a vessel, the United States should not lose the right to place responsibility for removal upon those who negligently sank the vessel." Id. at 204, 88 S.Ct. at 387.
It is critical that, although reserving the question of the applicability of the Limitation Act, Wyandotte appears to stand for the proposition that the United States must be afforded complete relief against the parties responsible for the sinking. Expressing doubt that Congress intended that "the Government's commendable performance of Wyandotte's duty (to remove the vessel) must be at Government expense," the Court sought by providing implied civil remedies to ensure that "the Government would (not) be subject to a financial penalty for the correct performance of its duty to prevent impediments in inland waterways." Id. at 205, 88 S.Ct. at 387 (footnote omitted).
In light of these policy arguments, it is not surprising that Wyandotte has been interpreted as impliedly ousting the Limitation Act from application to the government's recovery of wreck removal expense. The first policy theme is that the critical distinction is between negligent and innocent parties. "(I) n any case in which the (1899) Act provides a right of removal in the United States, the exercise of that right should not relieve negligent parties of the responsibility for removal." 389 U.S. at 205, 88 S.Ct. at 387. To be sure, in order to invoke the Limitation Act a shipowner must not have been personally negligent, i. e., the negligence of his ship's master or crew must not have been within his "privity or knowledge." See note 6, supra. Nonetheless the application of the Limitation Act would create "the anomalous situation . . . of a shipowner whose vessel had negligently obstructed navigation liable under the Rivers and Harbors Act limiting its liability under the Limitation Act because he was personally uninvolved in the casualty." 5 J.Mar.L. & Comm. 671, 678 (1974). The other side of this "anomalous situation" is, of course, that if the owner of the wreck limits his liability, the bulk of the expense of removing the wreck will be borne by an innocent party the government.
Courts that have denied limitation in this situation have characterized the latter statutory breach as within the owner's "privity or knowledge." See e. g., In re Chinese Maritime Trust, Ltd., 361 F.Supp. 1175, 1177 (S.D.N.Y.1972), aff'd 478 F.2d 1357 (2nd Cir. 1973); In re Scranton Industries, Inc., 358 F.Supp. 7, 8 (S.D.N.Y.1972); In re Pacific Far East Line, Inc., 314 F.Supp. 1339, 1349 (N.D.Cal.1970).13 It follows that the owner cannot invoke the Limitation Act with respect to liability arising from his failure to remove the wreck.
In the normal situation, of course, the owner of a negligently sunken vessel will not be the government but a private party. Suppose that vessel A's crew negligently causes vessel B to sink. The owner, pilot, and crew of vessel B are entirely innocent. The innocent owner of vessel B nevertheless has a statutory duty to remove the wreck. Indeed, according to the third clause of § 15 he would have such a duty even were the vessel accidentally wrecked.14 The faultless owner's presumed knowledge of his duty to remove would prevent him from limiting his liability for the wreck, however, if we accept this kind of "privity or knowledge" as precluding invocation of the Limitation Act.15 Once the owner of B removes the wreck, he will sue the owner of vessel A, which caused the wreck, to recover his expenses. At this point, however, the owner of B, who by hypothesis was not in "privity or knowledge" of his § 15 violation, will invoke the Limitation Act. The result will likely be that the innocent owner of A will be unable fully to recover the costs of wreck removal. This "would permit the result, extraordinary in our jurisprudence, of a wrongdoer shifting responsibility for the consequences of his negligence onto his victim," Wyandotte Transportation Co. v. United States, supra, 389 U.S. at 204, 88 S.Ct. at 387, by forcing the innocent party to bear the entire cost of removal with but a limited right of recovery. Accepting the appellants' argument that limitation can be avoided only if the limitation claimant has "privity or knowledge" would entail reaching this inequitable result.
The result clashes with the second theme of Wyandotte as well. Limiting the United States to an in rem recovery against appellants would subject the government "to a financial penalty for the correct performance of its duty to prevent impediments in inland waterways." Wyandotte Transportation Co. v. United States, supra, 389 U.S. at 205, 88 S.Ct. at 387.
As the Supreme Court noted in Wyandotte, it would be surprising indeed if Congress intended to penalize the government for having performed its duty to keep a navigable channel clear, 389 U.S. at 205, 88 S.Ct. at 387, by limiting it to in rem rights that would not reimburse the United States for removal expenses, 389 U.S. at 202, 88 S.Ct. at 386. Our decision today merely effectuates the policies of the Rivers and Harbors Act as enunciated in Wyandotte.
Section 12 thus makes the creation of an "obstruction" a criminal offense, while apparently reserving the injunctive power only for the removal of "structures." The Supreme Court filled in this lacuna by reading the grant of injunctive authority broadly, to cover all § 10 offenses, in United States v. Republic Steel Corp., 362 U.S. 482, 80 S.Ct. 884, 4 L.Ed.2d 903 (1960) (injunction would lie to compel removal of industrial waste obstructing waterway).
Several cases, Loud v. United States, 286 F. 56 (6 Cir. 1923); The Manhatten, 10 F.Supp. 45 (D.C.Pa.1935), aff'd 85 F.2d 427 (3 Cir. 1935), cert. denied, sub nom United States v. The Bessemer, 300 U.S. 654, 57 S.Ct. 432, 81 L.Ed. 864 (1937); In re Eastern Transportation Co., 102 F.Supp. 913 (D.C.Md.), aff'd sub nom Ottenheimer v. Whitaker, 198 F.2d 289 (4 Cir. 1952); United States v. Bethlehem Steel Corp. (The Texmar), 319 F.2d 512 (9 Cir. 1963), have concluded that the Sections 10 and 12 are not applicable to sunken vessels.
The phrase "voluntarily or carelessly" has been interpreted to mean "intentionally or negligently." Wyandotte Transportation Co. v. United States, supra, 389 U.S. at 207, 88 S.Ct. at 388; United States v. Ohio Valley Co., Inc., 510 F.2d 1184, 1188 n. 7 (7th Cir. 1975).
Certainly nothing in Wyandotte would suggest that the United States has a cause of action for wreck removal expenses against an innocent owner either when the owner's vessel was negligently sunk by another or when the vessel was accidentally or non-negligently sunk. See Wyandotte, supra, 389 U.S. at 197 n. 6, 88 S.Ct. at 384. This suggests that the owner of vessel B in our hypothetical would be wise to breach its statutory duty to remove.
Although theoretically free to sue qua owner in tort, the United States seeks relief in the case at bar qua sovereign, under the authority of the Rivers and Harbors Act. We thus treat the government's removal of its vessel, the A. MacKenzie, as having been effected in its sovereign capacity. See In re Sincere Navigation Corp., 327 F.Supp. 1024 (E.D.La.1971)
389 U.S. at 204, 88 S.Ct. at 387 (emphasis added). More important, in the case to which this language pertains, the government sought declaratory relief not merely against the owners but also against the managers, charterers, and insurers of the two sunken barges. Id. at 194, 88 S.Ct. at 382. Therefore Wyandotte's holding is not, as the appellants would have it, limited to owners of the wreck sought to be removed.
That this public policy is not limited to cases in which the limitation claimant is in "privity or knowledge" of the criminal violation, cf. The Snug Harbor, 53 F.2d 407, 411 (E.D.N.Y.1931), aff'd United States v. Eastern Transp., 59 F.2d 984 (2d Cir. 1932); Eastern S.S. Corp. v. Great Lakes Dredge and Dock Co., 256 F. 497 (1st Cir. 1919), is apparent from the Hines court's applying it to the owner's limitation claim regarding damage to the locks and dam. 551 F.2d at 724-25. Unlike § 15, the section of the Rivers and Harbors Act that makes causing such damage unlawful does not impose a subsequent statutory obligation, such as the duty to remove the wreck, which the owner could be said to have breached. Section 14, Rivers and Harbors Act of 1899, 33 U.S.C. § 408 (1970)
For example, the court quoted from the district court's opinion in Chinese Maritime Trust, supra, 361 F.Supp. at 1178, regarding Wyandotte's lending "renewed vigor" to the Wreck Act and the corresponding "disfavor" with which courts viewed the Limitation Act. United States v. Ohio Valley Co., Inc., supra, 510 F.2d at 1187
Maryland Casualty Co. v. Cushing, 347 U.S. 409, 437, 74 S.Ct. 608, 623, 98 L.Ed. 806, (1954) (dissenting opinion).
For a general summary of applicable pre-1851 limitation law, see "The Main" v. Williams, 152 U.S. 122, 14 S.Ct. 486, 38 L.Ed. 381 (1894).