United States Court of Appeals,
Fifth Circuit.
Nos. 95-20130, 95-20210.
ACACIA VERA NAVIGATION CO., LTD., et al., Plaintiffs-Appellees,
v.
KEZIA, LTD., et al., Claimants-Appellants.
ACACIA VERA NAVIGATION CO., LTD., et al., Plaintiffs-Appellants,
and
M/V OMINA, Plaintiff,
KEZIA, LTD., et al., Claimants-Appellees.
March 27, 1996.
Appeals from the United States District Court for the Southern District of Texas.
Before REYNALDO G. GARZA, WIENER and STEWART, Circuit Judges.
REYNALDO G. GARZA, Circuit Judge:
BACKGROUND
This is an appeal from a limitation of liability judgment in
admiralty against appellant the M/V BLUE CLOUD ("BC") for its
collision with the M/V OMINA ("OMINA").1 BC collided with OMINA on
March 30, 1993 at night in a fairway near Galveston. OMINA,
travelling 11-12 knots, was inbound to Houston and BC, travelling
18 knots, was outbound and in the process of overtaking an
1 In this opinion, the parties are designated by the names of their respective vessels. The M/V OMINA was owned and/or operated by Acacia Vera Navigation Co. Ltd. and Seaways Chartering Co. Ltd. Kezia Ltd. and Ahrenkiel Shipping (H.K.) Ltd. are the owners of the M/V BLUE CLOUD.
1 unidentified tanker located off its starboard side. OMINA was in
the middle of the fairway. BC was to the port side of the fairway
and the tanker was to the starboard side of the fairway. As OMINA
and BC were passing starboard to starboard at a distance of .30
nautical miles, BC took a sharp starboard turn colliding twice with
OMINA.2 According to the district court, OMINA would have passed
between the freighter and BC without incident had each ship
maintained her course.3
Owners of OMINA filed a Petition for Exoneration from and/or
Limitation of Liability. The owners of BC made the sole claim
against OMINA and posted a stipulation (corporate surety bond in
admiralty) with the St. Paul Mercury Insurance Co. ("St. Paul") as
surety in the amount of $1,150,000.00 in lieu of the arrest of BC
for damages sustained by OMINA. The parties stipulated that the
suit involved damages. Following a trial to the court, the court
made findings of fact and conclusions of law holding BC solely at
fault for the collision and, after determining damages, entered
final judgment in favor of OMINA.
The district court held that while port to port passing is
typically the rule, "it is the position of the vessels at the time
2 One nautical mile equals 6080 feet. Hereinafter, miles will refer to nautical miles. 3 OMINA made manual plots of its position that the district court relied on to find that OMINA maintained its position relative to BC prior to BC's sudden turn. The court found that had each ship maintained her position in the fairway, there would have been at least 3/10 of a mile distance between BC and OMINA and at least 4/10 of a mile between OMINA and the tanker, "a clear and sufficient distance in all respects."
2 they commence navigating with respect to each other which
establishes the manner of passing." Since the vessels approached
starboard to starboard and the pass could have been made safely, BC
was at fault for attempting to make an unreasonable port to port
turn. The court also held that since the vessels were not on
reciprocal courses, OMINA had no duty under COLREG 14 (Rule 14) to
pass port to port to avoid a non-existent risk.4
The lower court concluded that the most likely cause of the
accident was confusion on BC as to whether a ship's red port light
observed in the fairway was on the freighter or on OMINA.5
Believing that OMINA had made a hard starboard turn, BC did so as
well, colliding with OMINA. The district court found that OMINA
never showed her red port side light to BC.6 BC disputes this
4 COLREGS is an abbreviation for the International Regulations for Preventing Collisions at Sea. See 33 U.S.C. foll. § 1602 (1986). Hereinafter, COLREGS will be referred to by rule number.
5 BC's own expert witness Freehill concluded on deposition that the second mate's confusion was the cause of the collision though at trial he offered this scenario as "one of the possibilities." 6 Rule 23 requires all power-driven vessels longer than 50 meters to display two masthead lights, a sternlight, and two sidelights (a red light mounted on the port side, and a green light mounted on the starboard side). In this way, if one ship sees a red light approaching from a distance, that ship can be certain that the oncoming vessel is located to her port side, and vice versa for the sighting of an approaching green light. Masthead lights are white and must be placed along the forward-to-aft centerline of the vessel, one each at the forward and aft of the vessel. The aft masthead light is placed higher than the forward masthead light. The appearance of both red and green sidelights simultaneously or both masthead lights in line indicates that the two ships face a risk of head-on collision. Rule 23, 33 U.S.C. foll. § 1602.
3 characterization of the events.7
The district court finally concluded that
The fault of the M/V Blue Cloud in making her sudden and unexplained turn to starboard and the confusion demonstrated by the second mate of the [BC] who was in charge of her navigation are clear and sufficient explanations for the collision. There being a complete and satisfactory explanation, and there being no outstanding fault of the [OMINA] which apparently caused or contributed to the collision, no fault is attributable to the [OMINA]. Navigazione Alta Italia v. Keystone Shipping Co., 365 F.2d 422 (5th Cir.1966).
Accordingly, BC became liable for the roughly $700,000 of damage to
OMINA, as found in the second part of the bifurcated proceeding.
After the damages were set, BC moved to reduce the amount of
damages to the appropriate level and to substitute a letter of
undertaking ("LOU") from the Steamship Mutual Underwriting
Association (Bermuda), Ltd. (the "Club") for the St. Paul Mercury
corporate surety bond.8 The court granted the motion to reduce
security and substitute the Club for St. Paul.
BC made a timely appeal of the judgment. OMINA's separate
appeal of the substitution order followed and was consolidated with
BC's appeal. For the reasons stated below, we affirm.
DISCUSSION
BC finds numerous errors in the district court's findings and
conclusions. Specifically, BC contests the legal method through
7 BC claimed at trial that OMINA herself made a sudden starboard turn which prompted BC's turn and that both ships could see the other's masthead lights in line. 8 A letter of undertaking (LOU) is another form of security allowed to secure the release of a vessel in an in rem action under Fed.R.Civ.P. Supp. Rule E(5)(a).
4 which the district court determined liability for the collision,
the underlying factual findings, and the decision of the district
court to allow OMINA's claim for damages. OMINA challenges the
substitution of the LOU for the corporate surety bond though it did
not raise the arguments below. These arguments will be dealt with
in turn.
A. Standard of Review
This Court reviews conclusions of law made by the district
court de novo. Dow Chemical Co. v. M/V ROBERTA TABOR, 815 F.2d
1037, 1042 (5th Cir.1987). Factual findings will only be
overturned if clearly erroneous. Id.
B. The Court's Findings and Conclusions
1. The Application of Rule 14.9
The lower court held that because OMINA was never meeting the
Blue Cloud on a reciprocal or nearly reciprocal course so as to
involve a risk of collision, she had no duty under Rule 14 to make
a starboard turn. Rule 14 provides:
Head-on Situation
(a) When two power-driven vessels are meeting on a reciprocal course or nearly reciprocal courses so as to involve risk of collision each shall alter her course to starboard so that each shall pass on the port side of the other.
(b) Such a situation shall be deemed to exist when a vessel sees the other ahead or nearly ahead and by night she could see the masthead lights of the other in line or nearly in a line and/or both sidelights and by day she observes the corresponding aspect of the other vessel.
(c) When a vessel is in doubt as to whether such a
9 Rule 14, 33 U.S.C. foll. § 1602.
5 situation exists she shall assume that it does exist and act accordingly.
Thus, at night, should a ship see either both sidelights or both
masthead lights in line or nearly in line of another ship, that
ship should presume that both ships are on a reciprocal course and
alter the course to starboard to avoid collision. The Court
concluded that the ships were not on reciprocal courses under Rule
14 because, prior to the time the Blue Cloud made her hard to
starboard turn, neither of the vessels had exhibited her red light
to the other.
BC argues on appeal that the District Court erred by holding
that Rule 14 did not apply to the situation as it existed that
night. According to BC, the lower court considered only that both
sidelights were not visible in concluding that the two vessels were
not on a reciprocal course.10 BC claims that uncontroverted
evidence shows that the masthead lights of both ships were in line
or nearly in line and that the two ships were on a collision
course.11 According to BC, OMINA had a duty to alter the course to
10 The court was aware that Rule 14 provided an alternative for deeming ships to be on reciprocal course as noted in the Joint Pretrial Order. 11 BC points to one relevant record reference, a sketch made on deposition by the lookout stationed on the Omina, that arguably shows that the Omina could see the masthead lights in line or nearly in line. However, the ambiguous sketch also showed that only the green light of BC was visible, indicating that the ships were not on reciprocal courses.
BC additionally claims that the ships were only 2.5 degrees apart and thus on a reciprocal course according to Farwell's Rules of the Road. The district court relied on OMINA's radar plottings to find that the vessels in fact remained on parallel courses .30 miles apart until BC's turn.
6 starboard.12
We find no error in the court's finding that no risk of
collision was presented and its attendant conclusion that Rule 14
did not apply. While the lower court found that the ships were not
on reciprocal courses primarily from the fact that neither vessel
had exhibited her red (port) sidelight to the other, the court's
general finding was that the two ships were not on reciprocal
courses and would have safely cleared one another had the BC not
made the sharp starboard turn. Implied in that finding is that the
masthead lights were not in line or nearly in line. We also note
that COLREG Rule 7 deems a risk of collision to be present when the
bearing of an approaching vessel does not appreciably change as the
range decreases.13 The record shows that as range decreased, the
bearing of the BC changed, indicating that the vessels faced no
risk of collision.
We do recognize that the lower court could have made clearer
that the ships' positions met none of the scenarios envisioned by
Rule 14. However, given the amount of evidence that the ships were
not in fact on reciprocal courses and that no risk of collision was
presented until BC made its turn to starboard, the lower court's
We see no error in the court's reliance on these plottings to conclude that no risk of collision was presented. 12 BC also argues that alteration of course to starboard was required even if there was doubt as to the existence of possible reciprocal courses under Rule 14(c). However, the record shows no doubt on the part of OMINA, which maintained its course until BC struck it. 13 Rule 7, 33 U.S.C. foll. § 1602.
7 lack of specificity is hardly reversible error. Rule 14 applies
when there is a risk of collision. Since the court specifically
found no such risk, OMINA did not violate the rule when it
maintained its course.
2. OMINA's culpability in the collision.
BC challenges the lower court's failure to consider possible
violations on the part of OMINA before concluding that the OMINA
was free of fault. According to BC, the district court erred as a
matter of law by failing to include conclusions of law on whether
OMINA violated Rules 2, 6 and 8(a) and (e) before implicitly
concluding that OMINA had met its burden of proving under the
Pennsylvania Rule that alleged violations of these COLREGS could
not have contributed to the collision.
BC alleges that OMINA violated four COLREG provisions: Rule
2 (the general prudence rule); Rule 6 (failure to proceed at safe
speed to avoid collision); and Rule 8(a) (failure to take timely
action to avoid collision) and (e) (failure to slacken speed to
avoid collision). In The Steamship Pennsylvania, 86 U.S. (19 Wall)
125, 22 L.Ed. 148, 151 (1874), the Supreme Court held that where a
vessel at the time of collision is in violation of a statutory rule
designed to prevent collisions, in order to avoid liability, she
must show not only that her violation of the rule did not
contribute to the collision but also that it could not have
contributed. Thus, according to BC, the lower court erred by
failing to consider OMINA's alleged COLREG violations.
There is a problem with this argument. BC's statutory
8 allegations assume that the ships were on a reciprocal (collision)
course, an assumption contrary to the court's finding.14 Since the
lower court's finding that the ships were not on reciprocal courses
is supported by the record, BC's allegations are without merit.
Without risk of collision, the OMINA would have had no duty to
slacken speed, make radio contact, etc., and therefore violated no
statutory mandate. No evidence of statutory violations by OMINA
was presented under the circumstances. Therefore, the district
court correctly concluded that OMINA was not at fault in the
collision.
Nonetheless, we feel it necessary to discuss one troubling
issue of law present in the court's conclusion. The district court
apparently applied the major-minor fault rule, discussed in
Navigazione Alta Italia v. Keystone Shipping Co., 365 F.2d 422 (5th
Cir.1966). The district court stated that BC's starboard turn was
"clear and sufficient explanation for the collision" and that
because there was no "outstanding fault" by OMINA, no fault would
be attributed to her. This suggests that de minimis fault by OMINA
could be overlooked. Under the major-minor rule, where one party's
glaring fault sufficiently explains the entire collision, the court
can assign all fault for the collision to that party. Id. at 425.
14 For example, BC attacks OMINA's failure to make radio contact before passing within .30 miles as a violation of Rule 2's requirement of prudent seamanship. BC's authority for this assertion rests on a holding that prudent seamanship requires a vessel to attempt radio contact with an approaching vessel on a reciprocal course. G & G Shipping Co., Ltd. of Anguilla, 767 F.Supp. 398, 411 (D.P.R.1991). As noted above, the ships were not on reciprocal courses; thus, Rule 2 and the regulations meant to prevent collisions are inapplicable.
9 The court need not intensively scrutinize the other ship's actions
for contributory fault.
This major-minor rule arose as a corrective to the often harsh
divided damages rule, whereby parties who were both at fault in a
collision split damages evenly despite the degree of fault. Thomas
J. Schoenbaum, Admiralty and Maritime Law § 14-4 (2d ed.1994). The
Supreme Court rejected the divided damages rule and required use of
a comparative fault analysis in U.S. v. Reliable Transfer Co.,
Inc., 421 U.S. 397, 95 S.Ct. 1708, 44 L.Ed.2d 251 (1975). This
Court regularly applies comparative fault in admiralty cases.
Coats v. Penrod Drilling Co., 61 F.3d 1113, 1128 (5th Cir.1995);
Pennzoil Producing Co. v. Offshore Exp., 943 F.2d 1465, 1469 (5th
Cir.1991). The rejection of divided damages and enshrinement of
the comparative fault doctrine allows for no application of the
major-minor fault rule. Nunley v. M/V Dauntless Colocotronis, 727
F.2d 455, 463 (5th Cir.1984). If we did not say it clearly enough
before, we say it now: the major-minor fault rule is dead. A de
minimis fault rule is contrary to the intent and notion of
comparative fault. See Hercules, Inc. v. Stevens Shipping Co., 765
F.2d 1069, 1075 (11th Cir.1985) (discussing effect of Reliable
Transfer on major-minor rule and similar doctrines). If a party is
slightly at fault, that party would be partially liable for the
Despite the lower court's use of the major-minor rule and our
holding, remand is unnecessary in the instant case. BC has simply
made no meritorious allegations of statutory fault on the part of
10 OMINA. The lower court properly concluded that OMINA was not at
fault (statutory or otherwise) though it stated such in the terms
of a now-obsolete rule.15
3. Distance between BC and OMINA prior to the starboard turn of the BLUE CLOUD.
BC challenges the district's court finding that the vessels
were at least .30 miles apart. The district court explicitly
relied on OMINA's manual radar plots that showed that the vessels
were at least .30 miles apart just prior to BC's turn to starboard.
The court concluded that
The M/V OMINA had maintained radar plotting of the courses and speed of the several vessels at all times and was well aware of her own position and relative positions of the other vessels.
BC and OMINA contest how often these plottings were taken. BC
claims that the last plotting was taken fifteen minutes before the
collision and OMINA claims that the last one (its fourth radar
plot) was taken nine minutes before the crash. BC contests this to
show that, contrary to the court's conclusion, OMINA was not aware
of its position at all times. BC misstates the record in this
instance. OMINA's captain testified to the fourth plot being made
nine minutes prior to the collision. This argument lacks merit.
BC also makes a technical argument regarding the turning
radius of the BC when put hard to starboard. BC claims that this
radius is .24 miles, according to her sea trials. Therefore, the
15 Convincing us of the propriety of our conclusion is another of the district court's findings of fact stating that "[t]he M/V OMINA was free from any fault which caused or contributed to the collision."
11 OMINA must have been within .24 miles when BC made her sharp
starboard turn. However, there is no evidence that the BC was hard
to starboard. As the district court stated, the only person (BC's
quartermaster) who would know whether the BC was hard to starboard
was relieved of duty and sent out of the country before his
deposition could be taken. Additionally, there is nothing in the
record showing that conditions were similar as those conducted at
BC's sea trials.
BC has not shown the Court that this finding is clearly
erroneous. OMINA made several plots before the collision showing
her to be .30 miles from BC and she did not change her course. The
court was entitled to accept OMINA's radar plots as accurate. The
court's conclusion that the ships were at least .30 miles apart
prior to the starboard turn of BC is not a mistake. We will not
retry this case on appeal and upset the finding.
4. Sufficiency of distance between the ships prior to BC's starboard turn.
The district court found that
From the moment the M/V BLUE CLOUD and the M/V OMINA commenced navigating with respect to each other, each remained in its original relative position with respect to the boundaries of the designated fairway. The courses of the several vessels were such that if each had held its own course and speed, the vessels would have passed well clear of each other and without incident. There would have been at least 3/10 of a mile distance between the M/V BLUE CLOUD and the M/V OMINA.... a clear and sufficient distance in all respects. (emphasis added).
BC makes one technical argument and one hollow argument in
attacking the court's finding that the ships would have passed at
a clear and sufficient distance. BC argues simply that given the
12 speed and size of the vessels, the limited distance between them
was hardly clear and sufficient. BC claims that the vessels would
have closed the distance between them in 7.2 seconds. BC also
states that the fact that the collision occurred was compelling
evidence of the lack of prudence of OMINA. Ships should not be so
close together when possible.
The record demonstrates that while the fairway was narrow, the
vessels would have safely passed without BC's sudden turn. As
discussed above, the vessels were not on a collision course. That
the collision occurred does not mean both parties were imprudent.
Such is not the law. The record supports the trial court's finding
that the ships would have passed at a clear and sufficient
distance.
5. Most likely explanation for the collision.
BC contests the court's finding that the "most likely
explanation" was BC's second mate's confusion of the unidentified
tanker's red light with the red light of the OMINA. BC claims that
the ships' relative positions made it impossible for the second
mate to see the tanker's red light. BC also states that their
experienced mate would not have made such a mistake. BC maintains
that the cause of the accident was a sudden port-to-port turn by
OMINA. These arguments do not cause us to disturb the lower
court's finding.
In our estimation, the court below used its common sense in
concluding that confusion of lights was the most likely explanation
for the collision. We first note that the district court was not
13 attempting to say with scientific certainty why BC made the sharp
turn to starboard, only what the most likely reason was. BC stated
that it believed OMINA had turned starboard when the evidence
showed OMINA had maintained a steady course. If BC saw a red
light, it most likely was the tanker's. Even BC's own expert
witness offered confusion of red lights as "what happened" on
deposition, though at trial, this conclusion changed to "one of the
possibilities."
BC presented no evidence other than the testimony of the
mate's that OMINA attempted a port-to-port passing. The court
found that BC's mate was confused and careless as BC was overtaking
the tanker ahead of it. Accordingly, the lower court gave little
credit to this testimony. On review, we must give "due regard ...
to the opportunity of the trial court to judge of the credibility
of the witnesses." Fed.R.Civ.P. 52(a). Doing so, we discern no
clear error in the district court's finding.
6. OMINA's recovery of damages.
BC argues that the district court erred in entering judgment
against the BC for damages because the OMINA did not file a
counterclaim against BC. BC claims that the lack of a formal
counterclaim by OMINA deprived BC of sufficient notice of their
potential liability exposure and thus prejudiced them. This
argument is without merit.
A formal counterclaim is typically necessary to receive
damages as part of a limitation of liability action. British
Transport Commission v. U.S., 354 U.S. 129, 141, 1109, 1 L.Ed.2d
14 1234 (1957). However, as the district court noted in this case, BC
signed a stipulation on May 21, 1993, that stated that "Petitioners
[OMINA] have made a claim against the M/V Blue Cloud, in rem, and
her owners, and/or managers, Ahrenkiel Shipping (H.K.) Ltd., for
damages to the M/V OMINA as a result of a collision between the M/V
OMINA and the M/V BLUE CLOUD." (emphasis added). OMINA did file
a formal claim for damages against BC after the trial on liability.
The document was received by the lower court and ruled upon without
objection from BC. Given the stipulation and lack of objection, BC
cannot be heard now to argue contrary to the stipulation or to
claim lack of notice with regard to a damage claim by OMINA.
As the Eleventh Circuit noted in Cioffe v. Morris, 676 F.2d
539 (11th Cir.1982), prejudice involves issues not raised, not
demands or prayers for relief. All of the issues of fault that
would have a bearing on damages were raised by the pleadings and
were tried. The lower court did not err in entering the judgment
for damages.
OMINA's CONSOLIDATED APPEAL
OMINA, as appellant in this consolidated appeal questions the
lower's court's power to substitute a letter of undertaking from
the Club in lieu of St. Paul Mercury Insurance Co.'s corporate
surety bond then on file. OMINA also contends that the court erred
by substituting a form of security which provides less security
than the original bond. OMINA did not raise these arguments before
the district court. OMINA's sole objection to BC's Motion to
Reduce Security reads as follows:
15 Claimants have failed to confer with Petitioners regarding the Motion to Reduce Security. Said Motion fails to address all issues that should be considered by Petitioners and this Court in determining its merit. Accordingly, Petitioners cannot state at present whether they are opposed to Claimants' Motion or not.
Never having heard the substantive arguments made on this
appeal, the district court granted the motion to substitute
security. BC argues that the Court should not address these
arguments. We agree. As this Circuit stated in F.D.I.C. v.
Mijalis, 15 F.3d 1314, 1327 (5th Cir.1994),
[I]f a litigant desires to preserve an argument for appeal, the litigant must press and not merely intimate the argument during the proceedings before the district court. If an argument is not raised to such a degree that the district court has an opportunity to rule on it, we will not address it on appeal.
This Court will not disturb the lower court's order substituting
forms of security.
CONCLUSION
For the above reasons, this Court AFFIRMS in their entirety
the judgment and orders entered by the district court.