Opinion ID: 2960624
Heading Depth: 3
Heading Rank: 4

Heading: The Kostazos Fax

Text: Spain additionally suggests that ABS was reckless in disregarding a fax that was allegedly sent in August 2002 by the Prestige’s then-master (Captain Efstratios Kostazos), alerting ABS to putatively grave mechanical and structural problems aboard the vessel, and requesting that ABS conduct an emergency inspection. The precise identity of the fax’s recipient, however, in fact demonstrates a fundamental flaw in Spain’s argument. Spain’s theory of the case here is that parent-company ABS is liable for the harms caused by the Prestige casualty because high-level officials in ABS disregarded the unjustifiably high risk of harm to parties such as Spain that was posed by the Prestige. See, e.g., Appellant’s Br. 4, 8-9, 12-20; cf. J.A. 725-726, 735-736, 741743 (Affidavit of Brian D. Starer in Support of Spain’s Motion for Determination of Choice of Law).14 But the fax was not addressed to any of those senior executives, or indeed to anyone in ABS at all—it was addressed to ABS’s subsidiary, Marine Services. J.A. 1390, 1401. And there is of course no evidence 14 While Spain’s Amended Complaint names certain ABS subsidiaries as defendants in addition to the parent company, J.A. 89-90, Spain has not pointed on appeal to any tortious conduct by these subsidiary companies in particular. 28 in the record that the fax, if and when it was received there, ever made its way from Marine Services to ABS proper, much less to ABS decisionmakers. Spain does not contend that Marine Services (or any successor thereto) in particular was reckless in failing to respond properly itself to the fax, nor that Marine Services recklessly breached a duty to convey the fax’s information to officials at ABS so that they might respond. Thus, Spain’s argument must be that knowledge of the fax’s contents should be imputed from subsidiary to parent. On standard agency principles, such imputation would require Spain to establish both that an agency relationship existed between ABS and Marine Services and that the information at issue here went to matters within the scope of the agency. See Apollo Fuel Oil v. United States, 195 F.3d 74, 76 (2d Cir. 1999) (per curiam) (“In general, when an agent is employed to perform certain duties for his principal and acquires knowledge material to those duties, the agent’s knowledge is imputed to the principal.”) (emphases added); Mallis v. Bankers Trust Co., 717 F.2d 683, 689-690 (2d Cir. 1983) (same); see also Restatement (Third) of Agency § 5.03 & cmts. b, c, e (2006) (same). Even if we were to assume that Spain has introduced evidence sufficiently establishing that at relevant times, Marine Services (or its successor) was ABS’s 29 agent for certain purposes,15 evidence is lacking on the crucial question whether the Kostazos fax came within the scope of Marine Services’ duties as ABS’s agent. Assuming arguendo that Marine Services was ABS’s agent with regard to SafeHull, for example, it is undisputed that neither the owner nor operator of the Prestige ever purchased a SafeHull analysis of the vessel. With respect to other services, the record contains deposition testimony that Marine Services “provide[s] certification services to marine and offshore clients as it relates to fitness for purpose or certification to design specification,” J.A. 1579, and more generally that Marine Services “provides risk management and engineering support services to various third-party clients . . . as it relates to their operational performance and compliance issues that they may have from a certification standpoint of various regulatory or statutory entities,” J.A. 1581. Even if these services, at relevant times, were offered by Marine Services as an agent of ABS, Spain has not introduced evidence that either the owner or operator of the Prestige was ever a client of Marine Services, such that a fax from 15 We note that an agency relationship was not created simply by virtue of Marine Services having been a wholly-owned subsidiary of ABS, see Fletcher v. Atex, Inc., 68 F.3d 1451, 1461-62 (2d Cir. 1995); nor has Spain introduced evidence from which a reasonable jury could conclude that ABS exercised domination over Marine Services notwithstanding the separate corporate statuses of the two companies, cf. id. at 1458-61. 30 the crew of the Prestige would come within the scope of Marine Services’ duties on behalf of ABS. Nor is there any other evidence in the record from which a reasonable jury could conclude that information held by Marine Services regarding conditions aboard the Prestige should be imputed to ABS.16 As such, even if Marine Services did receive the Kostazos fax, the failure of ABS to respond to the fax cannot form the basis of any liability of ABS to Spain on this record.