Contribution, Assignment and Allision in General Maritime Claims

On the morning of February 28, 2008, two drifting barges belonging to U.S. United Bulk Terminal, LLC and its related entities (“United”) struck and damaged the M/V ALKMAN.  The damaged vessel’s owner filed suit against United, alleging negligent failure to secure and maintain its fleet.  Along with its answer, United filed a third-party complaint against Carnival Corp. and the cruise ship M/V FANTASY, alleging that improper navigation of the FANTASY caused the barges to break free.

The district court granted a motion for partial summary judgment based on the rule of THE LOUISIANA and subsequently dismissed United’s third-party complaint against Carnival with prejudice.  United later settled with the plaintiff, securing a release of all parties, including Carnival, and an assignment of the plaintiff’s claims against Carnival.  United then appealed the orders granting partial summary judgment and dismissing its third-party complaint.

On appeal, the Fifth Circuit first addressed whether the appeal was moot.  The question turned on whether United was entitled to seek contribution.  Looking to Supreme Court and Fifth Circuit precedent, the court reasoned that where a settling tortfeasor obtains a full release of all potential tortfeasors and that settling tortfeasor has paid more than he owes to the plaintiff, the settling tortfeasor may seek contribution.

Moving to the merits of the appeal, the court examined in detail some of the different presumptions that arise in maritime negligence suits.  The rules of THE OREGON and THE LOUISIANA, for example, are two fault-based presumptions that apply, respectively, when vessels under their own power or drifting vessels allide with stationary objects.  The presumptions force the party defending the suit to show that the stationary object was at fault, the moving vessel acted with reasonable care, or that the allision could not be avoided.

The Fifth Circuit ultimately determined that the district court improperly applied the rule of THE LOUISIANA, explaining that the presumption was not meant to operate between co-defendants.  Further, the district court imposed the wrong burden on United to rebut the presumption, requiring a showing of imprudent navigation rather than a reasonableness standard.  Finally, the district court incorrectly interpreted the presumption as one of sole liability when it dismissed Carnival as a party and precluded United from showing evidence of comparative fault.

Combo Maritime, Inc. v. U.S. United Bulk Terminal, LLC, — F.3d —-, 2010 WL 3295108 (5th Cir. 2010).

Note: This entry was prepared by Trevor Cutaiar, a present law clerk and future associate of Mouledoux, Bland, Legrand & Brackett.