Court Opinion

ID: 4302859
Source: CourtListenerOpinion
Date Created: 2018-08-10 18:00:28.490946+00
Date Added: 2024-06-11T14:02:00.010325
License: Public Domain

FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

MARY HOLZHAUER, Individually and        No. 16-15942
as the Personal Representative of
Harry Holzhauer, deceased,                 D.C. No.
        Plaintiff-Counter-Defendant-    3:13-cv-02862-
                           Appellant,         JST

                 v.

GOLDEN GATE BRIDGE HIGHWAY &
TRANSPORTATION DISTRICT, a
governmental entity,
                      Defendant,

                and

DAVID P. RHOADES, an Individual,
      Defendant-Counter-Claimant-
                         Appellee.
2                  HOLZHAUER V. RHOADES

 MARY HOLZHAUER, Individually and                No. 16-15974
 as the Personal Representative of
 Harry Holzhauer, deceased,                        D.C. No.
          Plaintiff-Counter-Defendant,          3:13-cv-02862-
                                                      JST
                     v.

 GOLDEN GATE BRIDGE HIGHWAY &                      OPINION
 TRANSPORTATION DISTRICT, a
 governmental entity,
  Defendant-Cross-Defendant-Cross-
                Claimant-Appellant,

 DAVID P. RHOADES, an Individual,
  Defendant-Cross-Defendant-Cross-
                Claimant-Appellee.

        Appeal from the United States District Court
          for the Northern District of California
          Jon S. Tigar, District Judge, Presiding

            Argued and Submitted June 14, 2018
                 San Francisco, California

                    Filed August 10, 2018

Before: Mary M. Schroeder and Ronald M. Gould, Circuit
       Judges, and Miranda M. Du, * District Judge.

                   Opinion by Judge Gould

    *
      The Honorable Miranda M. Du, United States District Judge for
the District of Nevada, sitting by designation.
                    HOLZHAUER V. RHOADES                             3

                          SUMMARY **

                          Maritime Law

    The panel affirmed the district court’s grant of judgment
as a matter of law in favor of a boat owner in an action under
maritime law arising from a fatal boating accident when a
recreational speedboat crashed into a passenger ferry.

    Addressing the boat owner’s duty of care, and relying on
persuasive authority from the Eleventh Circuit, the panel
held that a boat owner who is a passenger on his boat has no
duty to keep a lookout unless the owner-passenger knows
that the person operating his boat is likely to be inattentive
or careless or the owner-passenger was jointly operating the
boat at the time of the accident. The panel held that joint
operation is not viewed over the course of the entire trip, but
instead at the time immediately preceding and concurrent
with the accident. The panel affirmed the district court’s
grant of judgment as a matter of law in favor of the owner-
passenger.

    **
       This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
4                HOLZHAUER V. RHOADES

                       COUNSEL

Edward M. Bull III (argued) and Kurt Micklow, Brodsky
Micklow Bull & Weiss LLP, Alameda, California, for
Plaintiff-Counter-Defendant-Appellant.

David E. Russo (argued) and Matthew W.J. Johnston, Lewis
Brisbois Bisgaard & Smith LLP, San Francisco, California,
for Defendant-Appellant.

John D. Giffin (argued) and Francesca M. Lanpher, Keesal
Young & Logan, San Francisco, California; Lindsay
McKasson (argued) and Philip R. Weltin (argued), Weltin
Streb & Weltin LLP, Oakland, California; for Defendant-
Counter-Claimant-Appellee.

                        OPINION

GOULD, Circuit Judge:

    These two related appeals arise from a tragic and fatal
boating accident when a recreational speedboat crashed into
a passenger ferry. Harry Holzhauer (Mr. Holzhauer) was
driving his life-long friend Defendant David Rhoades’s
speedboat. Mr. Holzhauer was looking in the opposite
direction of where the speedboat was traveling when he
crashed Rhoades’s speedboat into the M/S San Francisco
ferry. Mr. Houlzhauer died from his injuries and Rhoades
was severely injured. Mary Holzhauer (Mrs. Holzhauer), as
representative of her late husband’s estate and in her
individual capacity, sued Rhoades and the Golden Gate
Bridge Highway and Transportation District (GGB), which
owns the M/S San Francisco ferry. Rhoades filed a cross-
claim against GGB and a counterclaim against the Holzhauer
                 HOLZHAUER V. RHOADES                       5

estate. Likewise, GGB filed a cross-claim against Rhoades
and a counterclaim against the Estate.

    After trial Rhoades moved for judgment as a matter of
law against Mrs. Holzhauer, and for judgment as a matter of
law against GGB. The district court granted both motions,
and Mrs. Holzhauer and GGB appeal. Because the accident
occurred while the colliding boats were in San Francisco
Bay on waters of the United States, we apply federal
maritime law. We hold that a boat owner who is a passenger
on his boat has no duty to keep a lookout unless the owner-
passenger knows that the person operating his boat is likely
to be inattentive or careless or the owner-passenger was
jointly operating the boat at the time of the accident. We
also hold that joint operation is not viewed over the course
of the entire trip, but instead at the time immediately
preceding and concurrent with the accident. We affirm the
district court’s grant of judgment as a matter of law in favor
of Rhoades against Mrs. Holzhauer and against GGB.

                              I

    On February 16, 2013, Mr. Holzhauer was driving
Rhoades’s speedboat in the bays in and around San
Francisco, California. Rhoades was along for the ride and
assisted Mr. Holzhauer in his operation of the boat at some
times on the trip. While in Richardson Bay, where Sausalito
and Belvedere meet San Francisco Bay, the speedboat
collided with the M/V San Francisco, a ferry owned and
operated by GGB. A witness testified that at the time of the
collision, neither Rhoades nor Mr. Holzhauer was looking in
the direction that the boat was headed. Mr. Holzhauer died
because of his injuries, and Rhoades was seriously injured.

    Mrs. Holzhauer, on behalf of herself and the Holzhauer
estate, sued Rhoades and GGB for negligence in the death of
6                 HOLZHAUER V. RHOADES

Mr. Holzhauer. Rhoades and GGB filed counterclaims
against the estate for negligence and filed cross-claims
against each other. The case went to trial.

    After Mrs. Holzhauer’s case in chief, Rhoades moved for
judgment as a matter of law that Mrs. Holzhauer had not
presented any evidence that Rhoades was “anything other
than a cautious and reasonable recreational boat owner and
occupant.” The district court heard argument on Rhoades’s
motion for judgment as a matter of law on Mrs. Holzhauer’s
negligence claim against him. Mrs. Holzhauer’s attorney
stated both in his opposition papers and at argument that
“I’m going to argue tomorrow that Mr. Rhoades didn’t do
anything wrong” and that he “no longer intend[ed] to argue
that Rhoades was negligent.” This created an untenable
position for the district court wherein a party did not want to
pursue a claim but advocated that a jury nevertheless had
sufficient facts to find liability.

    Mrs. Holzhauer’s attorney also stated that Weissman v.
Boating Magazine, 946 F.2d 811, 814 (11th Cir. 1991)
provided the correct standard for a passenger, but argued that
a passenger was not defined to include the registered owner
of a boat. Mrs. Holzhauer’s attorney added that under either
the standard applicable to passengers or the standard
applicable to owners, there was sufficient evidence to create
liability for Rhoades. Rhoades’s attorney argued that even
if there were a joint venture, that venture “could kind of
come and go with the moment on the boat.” The district
court gave a tentative ruling granting the motion for
judgment as a matter of law on Mrs. Holzhauer’s claim
against Rhoades for negligence. After the close of all
evidence, the motion was renewed, and the district court
granted the motion and entered a special instruction
                  HOLZHAUER V. RHOADES                       7

notifying the jury that Rhoades was no longer a defendant
and that his conduct should not be considered.

    At the end of trial, Rhoades also moved for judgment as
a matter of law on GGB’s cross-claim for indemnity and
contribution. No motion was made on GGB’s third
affirmative defense of comparative negligence. The district
court granted Rhoades’s motion on GGB’s cross-claim for
equitable indemnity and contribution and sua sponte granted
judgment as a matter of law on GGB’s affirmative defense
of comparative negligence. Because of the judgments as a
matter of law, the jury did not assess any shared
responsibility of Rhoades in the boating accident.

    The jury found Mr. Holzhauer 70% at fault for the
accident and GGB 30% at fault. But because of the special
instruction, the jury attributed no fault to Rhoades. The jury
awarded Mrs. Holzhauer $546,747 in economic damages
and $1,000,000 in non-economic damages. It also awarded
Rhoades $2,229,559 in economic damages and $1,500,000
in non-economic damages. The estate and Mrs. Holzhauer
appeal the district court’s grant of Rhoades’s motion. And
GGB appeals the district court’s ruling on its third
affirmative defense and its cross-claim for equitable
indemnity and contribution.

                              II

    We have jurisdiction to review this case pursuant to
28 U.S.C. § 1292(a)(3). In reviewing the district court’s
grant of judgment as a matter of law under Rule 50, we
review its findings of fact for clear error and its conclusions
of law de novo. Torres v. City of L.A., 548 F.3d 1197, 1205–
06 (9th Cir. 2008). We view all evidence in the light most
favorable to the nonmoving party without weighing
evidence or making credibility determinations. Id. With
8                HOLZHAUER V. RHOADES

those legal standards in mind, we review the district court’s
grants of judgment as a matter of law in Rhoades’s favor.

                             III

    Both Mrs. Holzhauer and GGB argue that the district
court erred by applying the incorrect legal standard when
determining Rhoades’s duty of care. The duty of care that
applies to a boat owner riding as a passenger in his boat is a
question of first impression. Relying on the principles set
forth in Weissman v. Boating Magazine, 946 F.2d 811, 814
(11th Cir. 1991), which we consider to be persuasive, we see
no material difference between an ordinary boat passenger
and a passenger who owns the boat being used, if the boat
owner entrusts the boat to a competent operator. We
consider each appeal in turn.

                              A

    Mrs. Holzhauer contends that the district court erred by
treating Rhoades as just a passenger and by resolving
questions of fact in favor of the moving party. She argues
that maritime law is clear that every vessel owner owes
others a duty of reasonable care and that applying the
Weissman passenger standard was a legal error. She argues
that even if Rhoades were merely a passenger, the record
shows that he was operating the speedboat jointly, so one of
the Weissman exceptions would apply, permitting a finding
of liability. Rhoades responds that Mrs. Holzhauer made a
choice to litigate her case against only GGB and now that
Mr. Holzhauer was apportioned 70% liability, she attempts
to call Rhoades’s liability into question. Rhoades contends
that the district court applied the correct legal standard: he
urges that there is no distinction between a passenger and an
owner-passenger for purposes of liability. Rhoades further
argues that Mrs. Holzhauer had not provided any facts to
                  HOLZHAUER V. RHOADES                       9

establish a duty on the part of Rhoades particularly because
Mr. Holzhauer was an experienced boat operator and
because Rhoades did not jointly operate the boat. We agree
with Rhoades.

    Every shipowner has a “duty of reasonable care under
the circumstances.” Peters v. Titan Navigation Co.,
857 F.2d 1342, 1344 (9th Cir. 1988); see Kermarec v.
Compagnie Generale Transatlantique, 358 U.S. 625, 632
(1959) (“We hold that the owner of a ship in navigable
waters owes to all who are on board for purposes not
inimical to his legitimate interests the duty of exercising
reasonable care under the circumstances of each case.”). But
as “a general rule, a passenger has no duty to keep a lookout
on behalf of the operator of the vehicle.” Weissman,
946 F.2d at 814. The passenger need only keep a lookout in
two circumstances: when “he knows from past experience or
from the manner in which the vessel is being operated on the
particular trip, that the driver is likely to be inattentive or
careless” and when the passenger “jointly operated” the
vessel, meaning he “had active responsibility for and control
over certain aspects of navigation of the boat.” Id.

    The novel question for us is what legal standard applies
when an owner of a boat is also a passenger on his vessel. In
tension are general duties of a ship owner to use reasonable
care under the circumstances and a passenger’s presumed
lack of a duty to keep a lookout. Mrs. Holzhauer cites
Kermarec for the general duty of a boat owner to act
reasonably under the circumstances. 358 U.S. at 632. There
the Supreme Court held “that the owner of a ship in
navigable waters owes to all who are on board for purposes
not inimical to his legitimate interests the duty of exercising
reasonable care under the circumstances of each case.” Id.
10                HOLZHAUER V. RHOADES

    Doubtless a boat owner owes a general duty of care, but
that duty of care depends on the circumstances. Here, the
circumstances involved a transfer in operation of the boat
from Rhoades to Holzhauer. Rhoades, to be sure, had a duty
to act reasonably in entrusting operation of the boat to
Holzhauer. And yet there is no record evidence whatsoever
that Rhoades was derelict in that duty. To the contrary, the
record suggests that Rhoades’s decision to entrust operation
of the boat to Holzhauer was reasonable because Holzhauer
“was a safe, cautious, and experienced boat operator.” No
party disputes that fact. Further, the Eleventh Circuit is the
only circuit to have considered when a passenger has a duty
to keep a lookout, and we will not create a circuit split merely
because Rhoades was also the boat owner. See CTIA-The
Wireless Ass’n v. City of Berkeley, Cal., 873 F.3d 774, 776
(9th Cir. 2017) (“[C]ircuit splits are generally to be
avoided.”).

    Although a boat owner has a general duty of care, when
that boat owner is functioning as a passenger it makes the
most sense to define the scope of duty to align it, so far as
boat operations are concerned, with that of a passenger. We
conclude that the Kermarec and Weissman duties are not in
conflict. The general reasonableness standard that applies to
a boat owner is designed to accommodate the particular
circumstances of the case. Kermarec, 358 U.S. at 632.
When the circumstances are that the boat owner is a
passenger on the boat, we hold that an owner-passenger has
no duty to keep a lookout unless, as with an ordinary
passenger, the person running the boat is known to the
passenger to be inattentive or careless in their operation, or
the passenger has been jointly operating the boat. Weissman,
946 F.2d at 814. We conclude that the district court did not
err by applying this standard.
                  HOLZHAUER V. RHOADES                      11

    While sitting as a passenger when the accident occurred,
Rhoades does not fit within either of the two exceptions
specified by the Eleventh Circuit as to when a passenger
would have a duty to act as a lookout. See Weissman, 946
F.2d at 814. No party argues that Mr. Holzhauer was
inattentive or careless on past boating excursions or while
operating the speedboat before the accident, and so that
exception to the general rule is not applicable here. We
conclude that it would be artificial to suggest that there was
joint operation of the boat because Rhoades had operated it
earlier in the day. Although Rhoades was running the boat
earlier that day, the joint operation inquiry properly asks if
the boat was being jointly operated when the accident
occurred. See id. at 814 (noting that both occupants were
jointly operating the boat “at the time of the accident”
because each “had active responsibility for and control over
certain aspects of navigation”). The testimony at trial bore
out that although Rhoades had helped Mr. Holzhauer earlier
in their trip by explaining the rules-of-the-road for passing
and had told Mr. Holzhauer to take another loop of the Bay,
Rhoades was looking off into the distance at the San
Francisco skyline when the accident occurred. Rhoades
allowed Mr. Holzhauer to take a loop, but Rhoades did not
direct the exact path that Mr. Holzhauer would take. We
conclude that the district court did not err in concluding that
Rhoades was not jointly operating the boat when the
accident occurred.

    While Rhoades did not give any negligent advice or
negligently entrust Mr. Holzhauer with the speedboat, it
could be argued that there was testimony that could support
the idea that his omission to give advice at a critical time
might have contributed to the accident. Rhoades testified
that his general practices in boating were to be aware of boats
around his vessel, to ensure that those who drove his boat
12                HOLZHAUER V. RHOADES

adhered to his safety standards, to watch over people who
drove his boat, and to look out for traffic. But Rhoades failed
here to look out for vessel traffic on the side of the speedboat,
suggested that Mr. Holzhauer make a loop through the ferry
lanes, did not warn Mr. Holzhauer about ferry traffic, did not
take extra precautions when entering ferry lanes, and did not
supervise Mr. Holzhauer, who was found to be 70% at fault
in killing himself and hurting Rhoades.                But Mrs.
Holzhauer’s counsel was asked many times by the district
court whether counsel thought Rhoades acted negligently.
Counsel more than once told the district court that he did not
think Rhoades was responsible. We are not persuaded, just
as Mrs. Holzhauer’s attorney and the district court were not
persuaded, that the facts mentioned show negligence on
Rhoades’s part in the circumstances once one rejects the idea
that he was jointly operating the boat and hence responsible
as a lookout. Rhoades was reasonable in his decision to
allow Mr. Holzhauer, an experienced boater, to operate the
boat. Once Rhoades was not negligent in entrusting boat
operation to Mr. Holzhauer, he stood in the position of a
passenger on the speedboat. Although tragic, it is obvious
that the key factor contributing to the accident was the
inattention of the two drivers of the two boats that collided,
not Rhoades.

                               B

    GGB appeals the same issue with a slight twist. GGB
argues that the lack of radar reflectors on Rhoades’s
speedboat limited the ferry’s ability to detect it. The district
court concluded that radar reflectors, while a good idea, were
not required and did not constitute a basis for finding a
breach of duty against Rhoades. GGB’s expert at trial said
that boat owners should equip their boats with reflectors, but
did not state that the reflectors were required or even
                 HOLZHAUER V. RHOADES                      13

common among small boat operators. Another expert had
no opinion on whether a small boat should have radar
equipment. Even if having radar reflectors is a good
practice, good practice does not create liability absent facts
to support that the practice is an operational standard in the
relevant community of small boat owners.

    GGB also argues that Rhoades was “complicit” in the
collision because he had been directing Mr. Holzhauer’s
route throughout the day and chose the route of the loop
where the accident occurred. Rhoades argues that the
evidence supported the conclusion that he had acted
reasonably on the day in question because Mr. Holzhauer
was an experienced boater and had not done anything unsafe,
and because Rhoades was not jointly operating the boat. As
we held above, passengers generally have no duty to keep a
lookout. See Weissman, 946 F.2d at 814. But, if the
passenger has notice that the operator is inattentive or
careless or the passenger has been operating the boat jointly,
he may have a duty to keep a look out. Id.

    The district court reasoned that Rhoades was not
directing the travel of the vessel and that Mr. Holzhauer was
an experienced boater. The district court concluded that
even though Mr. Holzhauer did not have experience in the
San Francisco Bay, there was no law giving rise to a special
duty from that type of lack of experience. We reject the
contention that Rhoades is a joint operator of the boat
because he had assisted Mr. Holzhauer previously that day.
There is no evidence in the record to support the conclusion
that Rhoades was jointly operating the speedboat when the
accident occurred. Therefore, none of the Weissman
exceptions to the general rule for a passenger—that he has
no duty to keep a lookout—apply.
14               HOLZHAUER V. RHOADES

    Golden Gate finally argues that comparative negligence
is ordinarily a jury question, and that there were facts
sufficient for a reasonable jury to conclude that Rhoades’s
conduct was not that of a reasonably prudent person. After
hearing argument on Rhoades’s motion, the district court
dismissed GGB’s affirmative defense for comparative
negligence against Rhoades and its cross-claim for equitable
contribution and indemnity, although Rhoades had only
moved for judgment as a matter of law on GGB’s cross-
claim for equitable contribution and indemnity. Rhoades’s
attorney had also said that “the comparative-negligence
issue [was] not at issue in th[e] motion.”

    A claim for indemnity is not the same as an affirmative
defense for comparative negligence. In this case, GGB
sought indemnification from Rhoades for any liability GGB
was ultimately apportioned for causing Mr. Holzhauer’s
death. Courts have recognized that under tort principles, “a
passively negligent party in admiralty can recover indemnity
damages from a primary negligent party.” SPM Corp. v.
M/V MING MOON, 22 F.3d 523, 526 (3d Cir. 1994). The
affirmative defense of comparative negligence, however,
would reduce any liability GGB may have had in the
collision by the proportion of Rhoades’s own negligence in
the accident. See United States v. Reliable Transfer Co.,
Inc., 421 U.S. 397, 411 (1975). The former causes Rhoades
to share in the cost GGB pays for liability to Mr. Holzhauer,
and the latter reduces any award GGB would pay in Mr.
Rhoades’s favor.

    While these claims are separate and distinct, the
distinction does not lead to different results here because
comparative negligence requires some negligence on
Rhoades’s part. GGB points to the fact that “Rhoades
admitted that his normal practice when someone else is
                 HOLZHAUER V. RHOADES                      15

driving is that ‘[he] kind of check[s] to see how they’re
doing; how they’re driving; if they seem to be capable of just
looking out for other traffic. Are they exceeding any kind of
speed that I wouldn’t do.’” “He admitted that had he noticed
that Mr. Holzhauer was not looking in the direction that he
was steering, he would have corrected him.” GGB points to
the fact that there was evidence that Rhoades had a lot of
experience operating his boat in San Francisco Bay,
compared to Mr. Holzhauer who, while experienced at
boating, had hardly any experience operating speedboats in
the San Francisco Bay. This, GGB claims, supports the view
that Rhoades breached a duty of care in the circumstances.
GGB’s argument is that even if Rhoades did not have a duty
to operate as a lookout for other boats, he had some duty to
watch Mr. Holzhauer to make sure he was driving safely.
But there is no evidence that Rhoades behaved negligently
at all in his duty under the circumstances. Rhoades’s duty
was to ensure that he entrusted the operation of his boat to a
competent boater, and everyone agrees that Mr. Holzhauer
met this criterion. Rhoades was available for Mr. Holzhauer
when he needed assistance navigating, but Rhoades
otherwise enjoyed the day of boating with his skilled friend
at the helm. Rhoades watched for the aberrant behaviors
noted above, but when Mr. Holzhauer did not exhibit them,
Rhoades enjoyed the leisure cruise. It is not surprising that
a small boat owner would do that after entrusting operations
to an experienced boater. Rhoades did not act negligently in
regards to himself or Mr. Holzhauer, so there is no basis to
reduce Rhodes’s recovery. We affirm the district court.

                             IV

   We hold that a boat owner who is a passenger on his boat
has no duty to keep a lookout unless the owner-passenger
was jointly operating the boat or the owner-passenger knows
16                HOLZHAUER V. RHOADES

from past experience or from conduct that day that the
person operating the boat is likely to be inattentive or
careless. We hold that joint operation is not viewed over the
course of the entire trip, but that we instead look at the time
immediately preceding the accident. The district court
applied the correct legal standard by adopting the reasoning
in Weissman, and we affirm.

     AFFIRMED.