Patterson Oil Terminals, Inc. v. the Port Covington et al. the Girard Point, 205 F.2d 694 (3d Cir. 1953)

Three questions are presented in the instant appeal: (1) did the District Court err in its fact finding and conclusions of law with respect to the liabilities of the parties to the litigation; (2) can respective liabilities of respondents with adverse interests be adjudicated in an admiralty action in the absence of a cross-claim or cross-libel setting up the issue of such cross-liabilities; and (3) did the specific averments in the answer to the libel filed by the complaining respondents constitute a "cross-claim" or "cross-libel" within the requirements of applicable pleading principles in admiralty.

The facts are set forth in detail in the opinion of the District Court E.D. Pa. 1952, 109 F. Supp. 953. They may be summarized as follows:

Patterson Oil Terminals, Inc. owned a mooring dolphin adjacent to its dock in the Delaware River at Billingsport, New Jersey. The dolphin was struck and damaged by the S. S. "Creighton Victory", operated under bareboat charter by the Black Diamond Steamship Corporation ("Black Diamond"). The collision occurred on February 14, 1948, while the "Creighton Victory" was being docked under her own power with the assistance of the tugs "Port Covington" and "Girard Point", owned and operated by the Curtis Bay Towing Company of Pennsylvania ("Curtis Bay").

At the time of the collision the captain of the "Creighton Victory" was present on its bridge as was the captain of the tug "Girard Point", who was acting in the capacity of docking pilot. The weather was clear but windy with heavy gusts of 40 miles per hour force. When the "Creighton Victory" was about 150 feet from the dock a sudden gust of wind sent her into a sheer which those in control of the vessel could not break before she struck the dolphin.

The District Court found that the collision was not the result of inevitable accident; that when the "Creighton Victory" and the tugs hove anchors at the start of the berthing operation about 20 minutes before the accident, the wind was 24 miles per hour and as the vessels moved down the river the wind increased in force; that the accident could have been avoided if three tugs had been used instead of two and that before the "Creighton Victory" left her anchorage she or Curtis Bay "could have insisted upon an additional tug" instead of proceeding with but two tugs.

In consonance with these fact findings the District Court held that Black Diamond and Curtis Bay had not met the burden of rebutting the presumption of negligence which arises when a vessel comes into collision with a stationary object and accordingly both were liable to the owner of the dolphin for the damages it sustained. It may be noted that the District Court further held that the presumption aforementioned operates against all parties participating in the management of the vessel and in doing so stated that "During the maneuvering of the vessel (the `Creighton Victory') in the effort to break the sheer, the captain was present on the bridge and if what the pilot did appeared to be insufficient or wrong he could have corrected or countermanded the pilot's orders."

In making its determination as to liability, the District Court declined to consider the effect of the provisions of a "pilotage clause" in a towing contract between Curtis Bay and Black Diamond which Curtis Bay contended made its docking pilot the servant of Black Diamond and accordingly relieved it of any liability to the owner of the damaged dolphin, or in the alternative entitled it to an indemnity judgment against Black Diamond. In doing so the District Court said, 109 F. Supp. at page 955:

"The pilotage clause by which the docking pilot became the servant of the vessel and her owners does not affect the tort liability of the parties to the libellant, whatever its effect may be as between the two parties to the contract."

Following the filing of the District Court's opinion, Curtis Bay, acting on its theory that it had sufficiently cross-claimed or cross-libelled in its answer to the libel (as subsequently set forth) filed a petition for review requesting additional findings of fact and conclusions of law and determination of the respective liabilities of Black Diamond and Curtis Bay to the owner of the damaged dolphin under the pilotage clause, and/or an adjudication of indemnity against Black Diamond.

The District Court in an "Opinion Sur Petition for Review and For Additional Findings"¹  denied the petition on the ground that "In the absence of a crosslibel, the findings requested by the petitioner would have no effect upon the decree²  nor would they necessarily obviate further litigation." Pursuant to this opinion the District Court entered a "Final Decree in re Determination of Liability Between Respondents" denying the petition for review. This appeal is from that decree and it raises the questions earlier stated.

With respect to the contention that the District Court erred in its determination that Black Diamond and Curtis Bay were negligent, we are of the opinion that the finding of negligence was amply supported by the evidence and must therefore be affirmed.³ 

As to the second question presented: can respective liabilities of respondents with adverse interests be adjudicated in an admiralty action in the absence of a cross-claim or cross-libel setting up the issue of such cross-liabilities. On that score it is well settled that the only manner in which affirmative rights may be asserted against a party in admiralty is by crossclaim or cross-libel or by an independent suit. Ward v. Chamberlain, 1859, 21 How. 572, 62 U.S. 572, 16 L. Ed. 219; The Dove, 1876, 91 U.S. 381, 23 L. Ed. 354; Bowker v. United States, 1902, 186 U.S. 135, 22 S. Ct. 802, 46 L. Ed. 1090; Mayer & Lage, Inc., v. Prince Line, Limited, D.C.S.D.N.Y. 1920, 264 F. 854; Cioffi v. New Zealand Shipping Co., D.C.S.D.N.Y. 1947, 73 F. Supp. 1015, 1016.

As to the third question presented: did the specific averments in the answer to the libel filed by the complaining respondents constitute a "cross-claim" or "cross-libel" within the requirements of applicable pleading principles in admiralty. With respect to this phase of the case Curtis Bay vigorously urges that the averments in Paragraph 13 of its answer to the libel sufficiently constituted a "cross-claim" or a "cross-libel" against Black Diamond and that the District Court erred in concluding otherwise. It becomes necessary, accordingly, to consider Paragraph 13 of the answer which reads as follows:

"13. As a further and separate defense, claimant-respondent avers that insofar as the aforesaid collision and loss may be determined to have resulted from the fault or negligence of the tug-master of Tug Girard Point who was on board the S. S. Creighton Victory in charge of the operation at all material times, claimant-respondent is entitled in respect to all sums adjudged against it to recover the same by way of indemnity from respondent United States of America⁴  under the Pilotage Clause of the towage contract between the said parties, reading as follows:

"`Whenever the Master or other officer of any tug or any licensed pilot goes on board a vessel to assist her movement or handling, he becomes and continues to be solely the servant of said vessel and her owners in respect of all acts done by him and all orders given by him to any tugs engaged or to said vessel or otherwise in the movement or handling of said vessel; and none of the tugs or their owners, agents or charterers shall be responsible or liable for any claims or any damages caused by or resulting from such acts or orders.'"

Analysis of Paragraph 13 discloses that it merely asserted a right to recovery by way of indemnity against the United States (Black Diamond) under the Pilotage Clause, in the event that the District Court found that there was negligence on the part of its tug-master while he was acting as docking pilot aboard the "Creighton Victory"; this on the ground that the Pilotage Clause provided that the tugmaster while acting as docking pilot became "solely the servant" of the "Creighton Victory."

On this score it must be noted that the only relief asked for by Curtis Bay was the dismissal of the libel as to it and the tugs "Port Covington" and "Girard Point". It did not ask or pray for any judgment by way of indemnity against Black Diamond. It merely asserted its right to recover indemnity from Black Diamond.⁵ 

The averments in Paragraph 13 did not constitute a cross-libel. Mayer & Lage, Inc. v. Prince Line, Limited, supra;⁶  The Edward H. Blake, 5 Cir., 1899, 92 F. 202⁷ ; Hawgood & Avery Transit Co. v. Dingman, 8 Cir., 1899, 94 F. 1011; see Consolidated New York Coal Corp. v. Howard, D.C.S.D. N.Y.1943, 52 F. Supp. 600. It was not in form a cross-libel; it was not attended with the requisite formalities of a cross-libel; there was no posting of security nor was it required that Black Diamond should give security to respond in damages to the claims set forth in the cross-libel.⁸ 

It is not a question of whether the answer gave Black Diamond notice or some indication that Curtis Bay intended to assert its rights under the Pilotage Clause. One is not required to defend upon receipt of mere notice; one need only defend when properly proceeded against according to legal process.

Curtis Bay contends that "Such refinement of pleading (the insistence upon a cross-libel) is foreign to general practice in admiralty. There can be no question of surprise on the part of Black Diamond * * * where the issue is raised in some clear and appropriate manner in the original pleading of * * * Curtis Bay * * * as was done in this proceeding."

That is an ingenious argument but we cannot subscribe to it. To do so would be to obliterate rules of pleading and practice long established and observed by admiralty practitioners.⁹ 

Accordingly, we are of the opinion that the District Court did not err in holding that the averments in the answer did not constitute a cross-libel and that in the absence of the latter "the findings requested by the petitioner (Curtis Bay) would have no effect upon the decree (adjudging Curtis Bay and Black Diamond liable) nor would they necessarily obviate further litigation." Publicker Industries, Inc. v. Tugboat Neptune Co., 3 Cir., 1948, 171 F.2d 48.

One final comment. On this appeal Curtis Bay evidenced concern lest the defense of res judicata could be asserted by Black Diamond against any suit which it might bring under the provisions of the Pilotage Clause in view of the District Court's disposition. In our view there is no basis for such a concern. The District Court specifically noted in its disposition that it was not adjudicating the respective rights of Curtis Bay and Black Diamond under the Pilotage Clause of the towage contract and we agree with it that it did not do so. In its "Opinion Sur Petition for Review and for Additional Findings" the District Court observed that the findings requested by Curtis Bay "would have no effect upon the decree nor would they necessarily obviate further litigation." (emphasis supplied).

In this statement the District Court made it quite clear that further litigation would inevitably be required to resolve the respective rights of Curtis Bay and Black Diamond under the Pilotage Clause, and at the risk of being repetitious we again express our agreement.

Curtis Bay has its remedy. It may bring an independent suit against Black Diamond in order to determine the effects of the Pilotage Clause upon their respective rights. The rule of res judicata provides that when a court of competent jurisdiction has entered a final judgment on the merits of a cause of action, the parties to the suit and their privies are thereafter bound not only as to every matter which was offered and received to sustain or defeat the claim or demand, but as to any other admissible matter which might have been offered for that purpose. Cromwell v. County of Sac, 1877, 94 U.S. 351, 352, 24 L. Ed. 195. But the rule applies only to repetitious suits involving the same cause of action, Commissioner v. Sunnen, 1948, 333 U.S. 591, 597, 68 S. Ct. 715, 92 L. Ed. 898, and is therefore not applicable here. As for the much narrower doctrine of collateral estoppel, it applies where the second cause of action is upon a different cause, and in this situation the prior judgment operates as an estoppel as to matters which were actually at issue, and upon the determination of which the verdict was rendered. Commissioner v. Sunnen, supra.

Since the District Court refused, and properly so, to adjudicate with reference to questions related to the operation of the Pilotage Clause, the doctrine of collateral estoppel cannot and will not operate to prejudice Curtis Bay in any subsequent litigation.

For the reasons stated, the Final Decree in re Determination of Liability Between Respondents of the District Court will be affirmed.