HomeCircuit Court Admiralty CasesLimitation of Liability Act
Limitation of Liability Act

The following are digests and case links to Circuit Court Admiralty Cases that have as an issue the Limitation of Liability Act:

Mediterranean Shipping Co. v. Pol-Atlantic
Second Circuit Court of Appeals
October 13, 2000

Limitation of Liability Act: When a vessel owner personally warrants the seaworthiness of the vessel, the owner has made a personal contract and is not entitled to limitation under the Act. Thus where the slot charter at issue contained such a personal promise, the slot charterers' indemnity claims against the owner for cargo damage fall outside the limitation proceeding. Arbitration: If on remand the district court concludes that the owner and slot charterers agreed to arbitrate within the meaning of the Federal Arbitration Act, and the slot charterers raise no other valid defenses, the court should grant owner's motion to stay the indemnity claims and require that such claims be brought in London arbitration pursuant to the charter.

In re Tetra Applied Technologies
Fifth Circuit Court of Appeals
March 25, 2004

Limitation of Liability Act:  Claimant was entitled to pursue his remedies in state court, although a federal limitation action was pending, where he stipulated as follows: (1) that Owner is entitled to and has the right to litigate all issues relating to limitation of liability in federal court; (2) that he would not seek in other federal or state courts any judgment or ruling on the issue of Owner's right to limitation of liability; (3) that he would consent to waive any claim of res judicata relevant to the issue of limitation of liability based on any judgment that the state court may render; and (4) that he would not seek to enforce any judgment or recovery in excess of $725,000 (the value of the vessel) pending the adjudication of the complaint of limitation of liability in federal court. Claimant was not required to stipulate that exoneration from liability issues, as opposed to limitation of liability issues, would only be heard in federal court. 

Karim v. Finch Shipping
Fifth Circuit Court of Appeals
September 5, 2001

Procedure (Jurisdiction)/Limitation of Liability Act: The shipowner waived its jurisdictional defense where it voluntarily provided the district court in rem jurisdiction by commencing the limitation proceeding and placing the res, or the bond, in the hands of the court, and where it invoked the powers of the court to require the plaintiff seaman to halt his proceeding in another forum and to file in the limitation action. Procedure (Forum Non Conveniens): The relevant private and public interest factors under Gulf Oil/Piper Aircraft, such as Plaintiff receiving medical treatment in the United States, evidence and testimony being easily accessible in this forum, counsel for both parties being based in this forum, and the fact that United States limitation law applied, weighed against dismissal. Choice of Law: The district court did not err in making a determination of quantum of personal injury damages under Bangladeshi law by applying English and Indian precedent since experts informed the court that Bangladeshi courts would look to Indian and British cases for guidance where their precedents were lacking. Damages (Prejudgment Interest): The award of prejudgment interest is discretionary (both under Bangladeshi and United States law) and the district court did not abuse its discretion in setting the initial date of the interest accrual to be the date the limitation action was reactivated in federal court, rather than the date of injury. 

In re Hellenic, Inc.
Fifth Circuit Court of Appeals
May 21, 2001

Limitation of Liability Act: Once the claimant establishes negligence or unseaworthiness caused the loss, the owner of the vessel must prove that the  negligence was not within the owner's privity or knowledge to limit its liability. The construction superintendent whose negligence caused the loss, although he may have possessed significant power over the management of an individual job, could not make "basic business decisions" for the corporation and did not possess managing authority over "the field of operations" in which the negligence occurred, thus his negligence was not within the privity or knowledge of the corporate owner.

In re Tidewater Marine, Inc.
Fifth Circuit Court of Appeals
April 18, 2001

Limitation of Liability Act: The district court erred in declining to lift its stay against state court proceedings against the vessel owner where the claimants had stipulated: (1) that they would not enforce a state court judgment beyond the alleged value of the vessel and her pending freight unless and until the district court established a higher value or denied the owner's right to limitation and (2) that none of their claims had priority over any other and that they would be paid from the limitation fund on a pro rata basis. The district court erred in concluding that persons who had failed to file claims directly against the shipowner long after the accident were "potential claimants" that must be included in the stipulation before a stay will be lifted. Further, the claimants were not required to include an exoneration stipulation to have the stay lifted.

In re Barnacle Marine Management
Fifth Circuit Court of Appeals
December 1, 2000

Limitation of Liability Act: 33 U.S.C. section 408 of the Rivers and Harbors Act does not provide the United States with an in personam remedy against the owner of a vessel that damages a public work, thus the District Court's decision allowing the United States to proceed with an in personam claim against the vessel owner outside of the vessel owner's limitation action was in error.

In re Dolphin Services Inc.
Fifth Circuit Court of Appeals
August 24, 2000

Limitation of Liability Act: An original state court petition for personal injury damages that incorrectly identified the subject vessel was not sufficient notice to trigger the Limitation of Liability Act's provision requiring limitation actions to be filed within six months of receiving written notice of claim. 

In Re: Complaint of Transporter Marine, Inc.
Fifth Circuit Court of Appeals
July 13, 2000

Limitation of Liability Act/Coast Guard Regulation: The Coast Guard's adjudication of charges arising from the enforcement of its drug and alcohol testing regulations are exempt from exoneration or limitation proceedings under the Limitation of Liability Act. 

Alter Barge v. Consolidated Grain & Barge Co.
Seventh Circuit Court of Appeals
November 8, 2001

Limitation of Liability Act: Although the personal injury claimant filed his claim late in the limitation proceeding, he was not barred since cause was shown (his explanation met the minimal cause requirement) and permission to file late claims is freely granted so long as the limitation proceeding is ongoing and the late claim will not prejudice other parties.

In Re Complaint of Holly Marine Towing Co.
Seventh Circuit Court of Appeals
October 26, 2001

Limitation of Liability Act: It was an abuse of discretion for the district court to have dissolved the limitation act injunction against state court claims against the barge owner where a third party defendant with a contribution claim against the owner had not stipulated, along with the plaintiffs, that it would not ask the state court to resolve any issue concerning the limitation of the barge owner's liability.

In re MO Barge Lines
Eighth Circuit Court of Appeals
March 15, 2004

Collisions/Casualties: During the early hours of July 31, 2000, the Miss Belterra, a new casino vessel heading up the Mississippi River, collided with the Elizabeth Ann, a towboat pushing concrete barges down the river. The district court properly found that Elizabeth Ann's pilot violated Inland Navigation Rule 14 when he failed to propose the manner of passing as he was the downward vessel. It is mandatory that a downward vessel on the Mississippi River propose the manner of passage and initiate the maneuvering signals that will be used. Limitation of Liability Act:  To determine a vessel owner's entitlement to limit its damages, a court must determine (1) whether negligence or unseaworthiness caused the accident, and (2) whether the shipowner was privy to, or had knowledge of, the causative agent.  Unseaworthiness was not supported by the record since the pilot's decision not to increase the radar's range when he first noticed approaching lights was navigational error, rather than evidence of incompetence that would render the vessel unseaworthy. Further, the towboat owner was not in privity since it had hired a licensed, competent pilot to navigate its vessel and it was not on notice that the pilot would operate the vessel negligently. Owner could thus limit its liability.

In re Complaint of Ross Island Sand & Gravel
Ninth Circuit Court of Appeals
September 12, 2000

Limitation of Liability Act: Under the "single claimant exception," if only one claim has been filed in a district court limitation proceeding, a district court is required to dissolve its injunction to permit the single claimant to pursue a separate action and jury trial if the single claimant: (1) stipulates that the value of the limitation fund equals the combined value of the vessel and its cargo; (2) waives the right to claim res judicata  based on any judgment rendered against the vessel owner outside of the limitation proceedings; and (3) concedes the district court's exclusive jurisdiction to determine limitation of liability issues. Thus where the single claimant failed to stipulate to the value of the limitation fund, the district court's decision denying claimant's motion to dissolve the injunction was upheld.

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