OAKLAND, Calif. (CN) – A barge owner cannot sue a tugboat owner for damage to a pier because a settlement agreement did not release the tugboat owner for liability from a third party, a federal judge ruled.
Judge Phyllis Hamilton ruled in the complaint of Taurus Marine v. Marin County. Taurus owns the tugboat Terilyn, which Manson/Dutra hired to work on a dredging project in San Pablo Bay.
Manson/Dutra failed to obtain a full release from Marin County absolving Taurus Marine from responsibility for a series of allisions that damaged McNear’s Pier on the western edge of San Pablo Bay, Judge Hamilton ruled.
A severe storm in January 2008 caused Manson/Dutra’s barge CK-7 to break its mooring line from a buoy and drift and crash into McNear’s pier, which extends into the San Pablo Bay from McNear’s Beach in San Rafael.
The barge had been returned to the buoy the night before by Taurus Marine’s tug Terilyn after it had been emptied of dredge spoils taken from the Oakland Harbor. The barge was moored using Manson/Dutra’s pre-formed and pre-sized line that was attached to the buoy.
Manson/Dutra personnel took charge the next morning, directing the Terilyn and crew to assist in the salvage by pulling the barge off the beach while its personnel maintained the bow that was attached to a tree. The barge swung into and further damaged the pier. Taurus Marine claims Manson/Dutra personnel released the bow line to the barge prematurely, according to the ruling.
In July 2008, Taurus Marine filed the petition for exoneration from or limitation of liability for damages caused by the allisions.
Manson/Dutra and Marin County settled their claims in January 2009. In November that year Marin County and Manson/Dutra stipulated that claims the county had asserted against Taurus Marine in the present proceeding had been assigned to Manson/Dutra, that the county had withdrawn from the action, and that Manson/Dutra intended to “stand in the shoes of the County in this action and assert the County’s claims as its own.”
In December 2011, Taurus Marine sought partial summary judgment, arguing that Manson/Dutra is barred from recovering damages to McNear’s Pier under general maritime law.
Taurus Marine contends that the settlement bars claims against it because Marin County did not explicitly release it from liability and “neither contribution nor indemnity is permitted by a settling party against a non-settling party that is not released in the settlement,” according to the ruling.
Manson/Dutra claimed Taurus Marine is trying to escape liability by claiming there is no document by which Marin County released it from liability, and that such a mechanical test is not required because “Taurus Marine has effectively been released from liability by the County of Marin, noting that the County has been made whole, as the pier has been repaired, and the County also received monetary compensation for lost income and related expenses.”
Manson/Dutra also claims that the lack of a release is a “technical issue” that can be corrected because Marin County has no objection to granting Taurus Marine a full release.
The court disagreed, finding that Taurus Marine’s motion must be granted, that the assignment of rights from Marin County to Manson/Dutra is invalid and that Manson/Dutra is barred from seeking contribution or indemnity because it did not obtain a release of Taurus Marine when it negotiated a settlement with Marin County.
According to the ruling, earlier rulings, including McDermott Inc. v. Amclyde, discuss the proportionate share of liability for which parties involved in maritime claims should take responsibility and establish that assignment of a claim such as that made by Marin County is not valid if there is no provision in the settlement agreement specifically releasing the third party from liability.
While Manson/Dutra claims it would not be fair to permit Taurus Marine to evade liability simply because Manson/Dutra and Marin County did not include an explicit release in the settlement, it “provides no legal authority to support this argument,” which in any event runs counter to the court’s analysis of earlier rulings, from which the court concludes that “settling parties are not entitled to seek contribution or indemnity because settling parties assume the finality and potential benefit and risk of their settlement decisions,” according to the ruling.
Hamilton also rejected Manson/Dutra’s argument that failing to obtain a release is simply a “technical issue,” noting that “it is a legal bar under general maritime law.” Modifying the agreement would not be effective, as it would result in Manson/Dutra and Marin County creating a new settlement agreement that would not change the present agreement or avoid the same bars to litigation, the judge wrote.