Opinion ID: 567908
Heading Depth: 2
Heading Rank: 6

Heading: Offshore Express' Right to Limit its Liability to the Value of its Vessel

Text: 35 Offshore Express next contends that it should have been entitled to limit its liability under the maritime Limitation of Liability Act, which allows the owner of a vessel to limit its liability for any loss or injury involving the vessel to the value of the vessel and its freight. 46 U.S.C. § 183(a). 8 As the statute indicates, a party is entitled to limitation only if it is without privity or knowledge of the cause of the loss. Id.; see also Patton-Tully Trans. Co. v. Ratliff, 797 F.2d 206 (5th Cir.1986). In this context, a shipowner has privity if he personally participated in the negligent conduct or brought about the unseaworthy condition. In the Matter of Texaco, Inc., 570 F.Supp. 1272, 1278 (E.D.La.1983). Knowledge, when the shipowner is a corporation, is judged not only by what the corporation's managing officers actually knew, but also by what they should have known with respect to conditions or actions likely to cause the loss. Verdin v. C & B Boat Co., 860 F.2d 150, 156 (5th Cir.1988); Patton-Tully, 797 F.2d at 211. Finally, the burden is on the party seeking limitation to establish that it did not have knowledge or privity of the negligent activity or unseaworthy condition that caused the accident. Patton-Tully, 797 F.2d at 211. 36 Offshore Express has not met that burden here. There was substantial evidence before the district court to show that one Gerald Hoffman, Vice President and General Manager of Offshore Express, knew that masters of Offshore Express vessels operated those vessels in fog and that on occasion accidents had resulted. Hoffman's knowledge of this history of operation in conditions of reduced visibility is precisely the sort of knowledge of shore-based managing officials that vitiates the right to limit. See Tittle v. Aldacosta, 544 F.2d 752, 756 (5th Cir.1977). The district court correctly denied Offshore Express' petition to limit its liability. 37 On the whole, Offshore Express has identified no infirmity in the district court's judgment. The district court properly found 1) that Offshore Express was partially responsible for the allision, due to Captain Corey's negligence, 2) that the rule of Robins Dry Dock did not bar recovery by Pennzoil, and 3) that Offshore Express was not entitled to limit its liability. There is no basis on which to reverse any of these findings or conclusions, and the judgment against Offshore Express must be affirmed. The only remaining questions are those raised by Pennzoil's cross appeal.