Lexington Insurance v. Cooke's Seafood

686 F. Supp. 323, 1988 A.M.C. 574, 1987 U.S. Dist. LEXIS 183, 1987 WL 46340
CourtDistrict Court, S.D. Georgia
DecidedJanuary 7, 1987
DocketCV486-064
StatusPublished
Cited by3 cases

This text of 686 F. Supp. 323 (Lexington Insurance v. Cooke's Seafood) is published on Counsel Stack Legal Research, covering District Court, S.D. Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lexington Insurance v. Cooke's Seafood, 686 F. Supp. 323, 1988 A.M.C. 574, 1987 U.S. Dist. LEXIS 183, 1987 WL 46340 (S.D. Ga. 1987).

Opinion

ORDER

EDENFIELD, District Judge.

This declaratory judgment action was tried before the Court in admiralty on December 16, 1986. Having heard the testimony and arguments of counsel, and having reviewed the relevant documentary evidence, the Court makes the following findings of fact and conclusions of law. To the extent any findings of fact constitute conclusions of law, they are adopted as such. To the extent any conclusions of law constitute findings of fact, they are so adopted.

FINDINGS OF FACT

Plaintiff Lexington Insurance Company [Lexington] is a Delaware corporation; its principal place of business is in Boston, Massachusetts. Defendant Snooper Fleet, Inc. [Snooper Fleet] is a South Carolina corporation; its principal place of business is in Murrel’s Inlet, South Carolina. Snooper Fleet engages in the commercial fishing business and currently is the owner of several fishing vessels. Defendant Borg-Warner Corporation [Borg-Warner] is a Delaware corporation engaged, inter alia, in the provision of financing for various kinds of commercial ventures.

In connection with the purchase of the F/V C-Jack, a 46-foot fiberglass hulled fishing vessel, Snooper Fleet obtained financing from Borg-Warner, the latter retaining a preferred ship’s mortgage on the ship. In February, 1981, Lexington, through an agent in Brunswick, Georgia, issued a marine insurance policy to “Cooke Seafood d/b/a Snooper Fleet, Inc.,” naming both Snooper Fleet and Borg-Warner as loss payees. Lexington’s policy provided coverage for physical damage and loss to three small vessels listed in the policy, these including the F/V C-Jack.

At issue in the case at bar is the alleged breach by Snooper Fleet of the navigation warranty contained in the aforementioned policy. Express “navigation” or “trading” warranties, setting out limitations on the geographic areas in which covered vessels may operate, are commonly included in maritime insurance policies. The terms of such warranties are determined on a policy by policy basis with reference to the physical characteristics of the insured vessel or vessels, including hull strength, seaworthiness, and the type and quality of safety and communications equipment carried. The policy issued to Snooper Fleet by Lexington contained the following language: “NAVIGATION WARRANTY: confined to the inland and coastal waters of the United States from Cape Harteras, North Carolina to Brownsville, Texas not exceeding 100 miles offshore, excluding all territorial waters of Cuba or Mexico.” The policy also provided: “Any deviation beyond the navigation limits provided herein shall void this policy; but on the return of the vessel in a seaworthy condition, within the limits herein provided, this policy shall reattach and continue in force and effect____” It is the plaintiff’s contention that, when the C-Jack was sunk by a hurricane on October 27, *325 1985, the vessel was outside of the designated 100 mile limit, and that therefore the loss of the C-Jack is not covered under the policy.

In October, 1985, the C-Jack, captained by Mr. John Hogan, a fisherman with approximately twenty years of experience, prepared to set out from the port of Galveston. The vessel, the smallest that Mr. Hogan had ever captained, was equipped for “bottom long-lining,” i.e., it carried several miles of steel cable, to be equipped with tackle as it was played out. On Thursday, October 24,1985, Captain Hogan listened to a weather report from the National Oceanographic and Atmospheric Administration [NOAA]. The report indicated that for the next three days winds could be expected to be between ten and fifteen knots, out of the southeast, and that there was no chance of a tropical storm. According to Captain Hogan, this report foretold “perfect fishing weather.” Hogan Deposition at 8. 1 Thus, at about noon on that day the C-Jack departed Galveston.

The C-Jack was equipped with a General Motors 671 diesel engine, capable of generating close to 1700 RPMs. Captain Hogan testified that, in order to conserve fuel and to avoid wear and tear, he never ran the engine over 1400 RPMs. It can be estimated that the C-Jack proceeded from Galveston at a speed of approximately six to seven knots, the engine operating at 1400 RPMs. See Hogan Deposition at 38. The ship proceeded throughout the daytime on the 24th and on into the night. At about 3:00 A.M. on October 25, Captain Hogan was awakened from his sleep by the noticeable loss of power in the vessel’s diesel engine. According to Mr. Hogan, the RPMs had dropped to 700. This occurrence, the result of sediment in the fuel having clogged several fuel filters, reduced the maximum speed of the vessel to two to three knots.

There is much confusion concerning the exact location of the C-Jack at the time of the engine difficulties under discussion, and from the utterly inconsistent and in many ways patently incredible testimony of the captain, the Court is unable to determine the location with any degree of accuracy. 2 In any event, the captain was not much concerned by the problem, as the following excerpt from his deposition indicates:

[EXAMINATION BY MR. YELLIN (Plaintiff’s counsel)]
Q. ... At the moment you first encountered any problems, why didn’t you return to Galveston?
A. It wasn’t a life threatening situation, to begin with. There was no threat of a storm. I did have some replacement filters. So, in a situation like that when you’re at sea, you affect [sic] your repairs and continue on with your work. You can’t be turning around and running to the dock every time you run into a little problem.

Hogan Deposition at 16-17.

Captain Hogan proceeded to replace several fuel filters with spares he kept on board; this replacement did not restore full power to the vessel. Nevertheless, believing that the situation was in no way serious, Captain Hogan did not attempt to contact the Coast Guard. Id. at 26. Rather, he “proceeded” offshore to an oil rig with which he was familiar, the Zapata Neptune # 39. At reduced speed, it took the vessel somewhere between no time at all and nine hours to reach the oil rig. 3 Mr. Hogan did *326 contact an oil rig supply vessel, which informed him that it was heading in, and that it would procure additional fuel filters in Cameron, Louisiana, with which it would return the following day. While it is nowhere stated in the captain’s deposition, the only logical conclusion that the Court can reach, regardless of the location of the C-Jack at the time engine problems developed, is that this supply vessel was to rendezvous with the C-Jack at the aforementioned oil rig on Saturday, October 26. The Zapata Neptune platform # 39 is located more than 100 miles from shore. 4

It is appropriate at this juncture to discuss the captain’s understanding concerning the vessel’s navigation warranty. The captain at all times has maintained that, while he may have been aware that there was some limitation upon the area in which he could fish, he was not aware that the insurance policy at issue contained a 100 mile navigation warranty.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

ABB Power T & D Co. v. Gothaer Versicherungsbank VVAG
939 F. Supp. 1568 (S.D. Florida, 1996)
Fuller v. State Farm Fire & Casualty Co.
721 F. Supp. 1219 (M.D. Alabama, 1989)

Cite This Page — Counsel Stack

Bluebook (online)
686 F. Supp. 323, 1988 A.M.C. 574, 1987 U.S. Dist. LEXIS 183, 1987 WL 46340, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lexington-insurance-v-cookes-seafood-gasd-1987.