Opinion ID: 197732
Heading Depth: 2
Heading Rank: 2

Heading: The OPA's Impact on the Limitation Act

Text: B. The OPA's Impact on the Limitation Act The OPA specifically addresses its relationship with the Limitation Act and other legislation when it states: Notwithstanding any other provision or rule of law, and subject to the provisions of this chapter, each responsible party for a vessel or a facility from which oil is discharged, or which poses the substantial threat of a discharge of oil, . . . is liable for the removal costs and damages specified in subsection (b) that result from such incident. 33 U.S.C. 2702(a) (emphasis added). Appellant MetLife asserts that this provision imposes the OPA's increased liability limits notwithstanding any previously applicable limitations under the Limitation Act, but does not eviscerate preexisting limitation procedure under the Limitation Act. Thus, the appellant argues, Limitation Act concursus remains available to responsible parties. However, a plain reading of the subsection suggests that the OPA repealed the Limitation Act with respect to removal cost and damages claims against responsible parties. See In re -9- JAHRE SPRAY II K/S, 1996 WL 451315,  (D.N.J. 1996); accord In re Odin Marine Corp., No. 96-5438, slip op. at 6 (S.D.N.Y. Aug. 7, 1997); Tug Capt. Fred Bouchard Corp. v. M/V BALSA 37, No. 93- 1321, slip op. at 2 (M.D. Fla. Oct. 22, 1996). Accordingly, the procedural rules incorporated into the Limitation Act are inapplicable as well to such claims. In interpreting similar language in the FWPCA, courts have held that the statute's notwithstanding phrase precludes application of the Limitation Act to claims by the United States for FWPCA pollution removal costs. See In re Oswego Barge Corp., 664 F.2d 327, 340 (2d Cir. 1981); In re Hokkaido Fisheries Co., Ltd., 506 F. Supp. 631, 643 (D. Alaska 1981). See also Schoenbaum, supra, at 376 (OPA broadly supersedes the Limitation of Liability Act with respect to damages and removal costs under both federal and state law, including common law). We find these cases to be persuasive because [n]either the language of OPA nor its legislative history suggests that OPA's provisions should be construed contrary to the settled law applicable to FWPCA when OPA was enacted. William M. Duncan, The Oil Pollution Act of 1990's Effect on the Shipowner's Limitation of Liability Act, 5 U.S.F. L. Rev. 303, 316 (1993). In addition to the notwithstanding clause, at least four other provisions in the statute explicitly repeal the Limitation Act with respect to certain types of claims. See 33 U.S.C. 2702(d)(1)(A) (repealing the Limitation Act as to third parties solely responsible for a spill); 2718(a) (repealing the -10- Limitation Act as to state and local statutory remedies); 2718(c)(1) (repealing the Limitation Act as to additional liability imposed by the United States, any state, or political subdivision); 2718(c)(2) (repealing the Limitation Act as to fines or penalties). The appellants contend that, outside of these specific instances, the Limitation Act continues to apply to the OPA. The Bunker Group, citing one commentator, notes that [i]f Congress' intent in enacting OPA had been to completely repeal the Limitation Act, it would not have painstakingly repealed it only with respect to certain types of actions. Duncan, supra, at 319. When we consider these five OPA provisions which explicitly repeal the Limitation Act as well as others that are irreconcilably in conflict, see infra, we find that the OPA has repealed the Limitation Act as to oil spill pollution claims arising under the OPA in the instant case. '[W]here provisions in the two acts are in irreconcilable conflict, the later act to the extent of the conflict constitutes an implied repeal of the earlier one . . . .' See Radzanower v. Touche Ross & Co., 426 U.S. 148, 154 (1976) (quoting Posadas v. National City Bank, 296 U.S. 497, 503 (1936) (noting standard for repeal by implication)). While the repeal of statutes by implication is disfavored, see Tennessee Valley Auth. v. Hill, 437 U.S. 153, 189 (1978), several key provisions of the two statutes are plainly inconsistent. First, the Limitation Act limits the shipowner's -11- liability to the post-accident value of the vessel plus pending freight, 46 U.S.C. 183, while the OPA contemplates a strict liability regime with statutory limits of at least $2 million for tanks vessels and $.5 million for all other vessels. 33 U.S.C. 2702, 2704. Moreover, in certain instances, the OPA imposes virtually unlimited liability on the responsible party. See 33 U.S.C. 2704(c). Second, the provisions on jurisdiction are in obvious tension. Only federal courts have jurisdiction over limitation proceedings. See, e.g., Complaint of Dammers & Vanderheide & Scheepvaart Maats Christina B.V., 836 F.2d 750, 755 (2d Cir. 1988). In contrast, the OPA grants federal and state courts jurisdiction to decide oil pollution cases. 33 U.S.C. 2717(b), 2717(c). Finally, the provisions of Rule F, the procedural rule that implements and which is incorporated into the Limitation Act, cannot be reconciled with sections of the OPA. See Part C, infra. Even assuming arguendo that the language is ambiguous, the legislative history is consistent with our interpretation. As this court has noted, the chief objective of statutory interpretation is to give effect to legislative will. Passamaquoddy Tribe v. State of Me., 75 F.3d 784 (1st Cir. 1996). In considering the OPA's liability provision, Congress stated: Liability under this Act is established notwithstanding any other provision or rule of the law. This means that the liability provisions of this Act would govern limitations compensation for removal costs and damages notwithstanding any limitations under existing statutes such as the act of March 3, 1851 . . . . -12- H.R. Conf. Rep. No. 101-653, at 103 (1990), reprinted in 1990 U.S.C.C.A.N. 779, 781 (Joint Explanatory Statement of the Conference Committee explaining 2702(a)). Furthermore, the Senate Report on the OPA bill asserts that the OPA completely supersedes the 1851 statute with respect to oil pollution. S. Rep. No. 101-94,at 14, reprinted in 1990U.S.C.C.A.N. 722, 736. More generally, as the Ninth Circuit reasoned in finding an implicit repeal of the Limitation Act by the liability provisions of the Trans-Alaska Pipeline Authorization Act, 43 U.S.C. 1651-1655, [a]pplication of the Limitation Act to [the OPA] would frustrate completely [the OPA]'s comprehensive remedial nature. See In re Glacier Bay, 944 F.2d 577, 583 (9th Cir. 1991). The purpose of OPA, as well as other remedial legislation passed by Congress and the states to address environmental disasters such as oil spills, was to encourage rapid private party responses. JAHRE SPRAY, 1996 WL 451315, at . However, the Limitation Act allows vessel owners virtually to eliminate liability for catastrophic damages. Glacier Bay, 944 F.2d at 583. Hence, the OPA's scheme is in irreconcilable conflict with the Limitation Act. Some claims arising from an incident in which oil pollution occurs do not escape the Limitation Act. For example, that Act remains in force for general maritime claims such as maritime tort actions for harms to persons or vessels. See 33 U.S.C. 2751(e) ([e]xcept as otherwise provided in this chapter, this chapter does not affect . . . admiralty and -13- maritime law). The district court below, in keeping with the OPA's savings provision in 2751(e), reserved the Limitation Plaintiffs' right to seek limitation of liability for those claims subject to reduction under the Limitation Act. Therefore, the Bunker Group's contention that the district court's order exempts from Rule F concursus all claims arising from the grounding, whether or not they arise under the OPA, is without merit. The appellants remain free to avail themselves of the Limitation Act and Rule F concursus for their non-OPA claims. C. The Independent Application of Rule F Concursus C. The Independent Application of Rule F Concursus The appellants claim that even if the OPA supersedes the Limitation Act, because the OPA fails to provide any guidance on the procedure necessary to implement it, Rule F concursus applies to actions under the OPA independently of the Limitation Act. To support their contention, the appellants note that Rule F is framed generally to address limitation of liability pursuant to statute. Rule F(1). Rule F was originally written by the Supreme Court to implement the 1851 Limitation Act. In redrafting the rules, the Supreme Court substituted a direct reference to the 1851 statute in Rule F with the pursuant to statute language, which we find reveals a more general purpose for Rule F. We conclude, however, that Rule F's requirements on venue and limitation of liability cannot be reconciled with the OPA's provisions regarding oil spill damages. Under Rule F, a limitation of liability proceeding may be commenced only in the -14- district where the vessel has been seized, or if the vessel has not been seized, in any district in which the owner has been sued. See Rule F(9). If neither the vessel has been seized nor action commenced against the owner, the limitation action may be filed in the district where the vessel may be. See id. Venue is proper in any district only if there is no pending litigation and the vessel is not within any district. See id. Under the OPA, in contrast, venue is proper in any district in which the discharge of oil or injury or damages occurred, or in which the defendant resides, may be found, has its principal office, or has appointed an agent for service of process. 33 U.S.C. 2717(b). Thus, the OPA offers claimants a much broader choice of forums while Rule F's venue requirements are significantly more restrictive. Rule F's deadline for claims is also inconsistent with the OPA's statute of limitation. Once a limitation action is commenced, the court issues a notice to claimants requiring them to file their claims by the date fixed in the notice. See Rule F(4). The court may fix a date that requires claims to be filed in as little as 30 days after issuance of the notice. Id. In the instant case, the monition period terminated approximately ten months after the date of the MORRIS J. BERMAN's grounding. The OPA, however, allows claimants three years to commence an action to recover removal costs and damages. See 33 U.S.C. 2717(f)(1), 2717(f)(2). In addition, if the claimant decides to seek recovery from the Fund, the claimant has six years to -15- present removal costs claims, see 33 U.S.C. 2712(h)(1), and three years to present damage claims. See id. 2712(h)(2). Finally, section 2717(f)(4) extends the limitation period for subrogation actions by three years from the date the Fund pays a subrogated claim. See 33 U.S.C. 2717(f)(4). One concern we have with the shortened claims period under Rule F is that it would interfere with the United States' subrogation rights under the OPA. If oil spill claims are subject to Rule F concursus, claimants who are barred by the court imposed deadline from recovering against the responsible party, are likely to present their claims to the Fund. Once the Fund pays a claim, the United States acquires all rights of subrogation. See 33 U.S.C. 2712(f), 2713, 2715(a). However, at that point, the United States may then be denied access to the proceedings against the responsible party, and consequently, the Fund will bear the financial burden of these late claims. The appellants respond that, under Rule F, the government's subrogation rights do not necessarily lapse because [f]or cause shown, the court may enlarge the time within which claims may be filed. Rule F(4). We believe though that subjecting the government's subrogation rights to the discretion of the trial court in every oil spill action fails to adequately secure those rights. Congress specifically examined this issue in creating the OPA's statute of limitation and giving the courts discretion over this matter is contrary to legislative intent. Moreover, even if the courts consistently enlarge the monition -16- period for subrogation claims, in many instances, the limited fund established by the concursus procedure will already have been exhausted. Finally, contrary to the appellants' contention that the OPA fails to provide any procedural guidance, the OPA does establish a claims procedure. The OPA requires all claims for removal costs or damages to be presented first to the responsible party or guarantor. See 33 U.S.C. 2713(a). If the responsible party denies liability or the claim is not settled within 90 days, the claimant may proceed against the responsible party in court or present the claim to the Fund. See id. 2713(c). In some enumerated instances, claims may be presented directly to the Fund without first presenting them to the responsible party. See id. 2713(b). The purpose of the claim presentation procedure is to promote settlement and avoid litigation. Johnson v. Colonial Pipeline Co., 830 F. Supp. 309, 310 (E.D. Va. 1993). In contrast to the OPA's claims procedure, Rule F forces all claimants into litigation against the vessel owner. If a claimant fails to appear in the limitation action within the monition period, he or she is enjoined from raising any claims. See Rule F(3). In view of these inconsistencies, we conclude that Rule F concursus even if independent of the Limitation Act is inapplicable to OPA claims.