Site Meter

Category: Admiralty

3

Limitation of Liability and the Gulf Oil Spill

Transocean (RIG), which owns the platform that exploded in the Gulf and caused the massive ongoing oil spill, is seeking to invoke the Limitation of Liability Act of 1851. This law, which has never been amended with respect to property or environmental damage claims, provides that a carrier cannot be held liable for anything more than the value of the vessel and its contents if the ship is involved in an accident that causes those sorts of harms.  It probably goes without saying that the value of the oil platform (more specifically, what’s left of it) is way less than RIG’s probable share of the cleanup costs.

I am very skeptical that the statute applies to an offshore oil platform, in part because that is not navigable and does not involve “traditional maritime activity.”  More broadly, though, this might be the right time to abolish this doctrine entirely.  Maritime scholars (me included) have long held that in a modern world of insurance and corporate organization, the limitation of liability is obsolete.  The problem is that Congress hasn’t had any reason to repeal the 1851 Act — it’s a pretty obscure area of law.  A high-profile incident like the Gulf spill, though, might change that, especially if a court somewhere accepts RIG’s defense.

1

General Average and Takings

One of the maritime doctrines that I enjoy teaching is the general average.  This principle applies when cargo is voluntarily sacrificed by the crew in a successful effort to save a ship in distress (or when a ship makes a similar sacrifice to save the cargo).  Let’s say the master decides that he needs to throw cargo overboard to lighten the vessel and prevent it from sinking.  If this works, then the cargo owner who suffers a loss must be compensated by the vessel and the other cargo owners.  The compensation is calculated on a proportional basis depending on the respective values of the cargo and the vessel, with each party paying something and with the cargo owner who was affected also paying a share.  (In other words, the party who suffers a loss is not fully compensated.)

There is a fruitful analogy here to takings law.  The general average, like a taking, involves payment when property is used for the common good.  (Of course, the general average involves private owners rather than an acquisition by the state.)  There is an interesting paper that could be written comparing how these sea and land doctrines are applied.  Here’s an example.  In cases where property is taken in an emergency and successfully halts the danger, the property owner typically gets zero.  Why?  Because the thought is that the property would have been destroyed anyway (say by a giant fire or a disease).  In the maritime context, we say that the property owner who sacrificed should just not be compensated fully, but should get something.

3

Pirates and Terrorists

Officials in Washington are still struggling with how to deal with the alleged terrorists detained in Guantanamo.  One day the issue is whether some of them should be tried in a civilian court and, if so, where?  Another day the question is whether, and how, they should be tried by military commissions.  And then there is the thought that some of the detainees should just be held indefinitely without trial.

The most fruitful analogy for thinking about this problem comes from piracy.  (Eugene Kontorovich has an excellent paper on the modern aspects of this comparison coming out in California Law Review.)  Pirates and terrorists are both irregular enemies (or unlawful combatants) whose actions are clearly condemned by international law.  So I thought I would talk about the British experience with suppressing piracy to see what we might learn about dealing with alleged terrorists.

Read More

2

Arrr . . . matey!

120px-Sperm_whale1bYesterday I became the Chair of the AALS Section on Admiralty and Maritime Law.  It was a bitter, hard-fought campaign in which I was the only volunteer.  So my main task is to put together a panel for the 2011 AALS Conference in San Francisco.

My idea for a panel builds on a post that I did wrote way back in April, which talked about what scholars in other fields can learn from Admiralty.  What I would like to do is get a contracts person, a torts person, and a corporate law person to talk about the relevant distinctions between maritime law and land-based doctrine.  I think that could be a fun discussion for lots of folks.  Please email me if you’re interested in participating.

5

Fun Cases You’ve Never Heard of — Part II

120px-Jolly-RogerUnited States v. Palmer, 16 U.S. (3 Wheat.) 610 (1818) is almost certainly the best case on statutory interpretation that you can use in the classroom.  If you’ve never heard of it, that’s because it is a maritime case about pirates.

Three Americans were convicted of piracy on the high seas.  A federal law provided for capital punishment where someone on the high seas committed “murder or robbery, or any other offense, which, if committed within the body of the country, would, by the laws of the United States, be punishable with death.”  The defendants argued that their crime was a robbery (no murder was involved) and that robbery was not a capital crime on land.  Thus, they could not be sentenced to death.

Read More

0

Fun Cases That You Don’t Know

Since it’s that time of year (by which I mean exam time), I thought I’d write a recurring series of posts on neat cases that I use in my courses but are relatively unknown.  These will mostly be Admiralty cases, as I doubt that there are any “fun” constitutional or IP decisions that are hidden in plain sight.

Let’s start with Koistinen v. American Export Lines, 83 N.Y.S.2d 297 (1948).  Plaintiff was a seaman who was on shore leave in Yugoslavia.  At a bar, he “met a woman whose blandishments, prevailing over his better sense, lured him to her room for purposes not entirely platonic; while there ‘consideration like an angel came and whipped the offending Adam out of him’; the woman scorned was unappeased by his contrition and vociferously remonstrated unless her unregarded charms were requited by an accretion of ‘dinner,’ . . . the court erroneously interpreted the word as showing that the woman had a carnivorous frenzy which could only be soothed by the succulent sirloin provided at the plaintiff’s expense; but it was explained to denote a pecuniary not a gastronomic dun”

I could go on quoting this opinion all day, but to move things along the seaman (having changed his mind about going through with this assignation) was locked in the room by the woman and confronted by her pimp.  The sailor leapt out the window to escape, fell about eight feet, and broke his leg.  The issue was whether the ship was required to pay maintenance and cure (medical expenses and lost wages) related to his injuries.   The Court said yes, on the grounds that shore-leave injuries (with one or two exceptions) are considered work-related in maritime law.  After all, stranding a sailor in a foreign port with no medical care would be contrary to the remedial goals of maintenance and cure.

10

Pirate Democracy

I just finished a fun book that I want to recommend. It’s “The Invisible Hook: The Hidden Economics of Pirates” by Peter T. Leeson. The author explores the Golden Age of Piracy (circa 1720) and shows how pirates overcame collective action problems. While there are many parts that are of interest to lawyers (for example, the pirate use of trademarks — the Jolly Roger — and crude advertising to enhance their brand of terror and encourage capitulation), the issue that I want to focus on is pirate governance.

Leeson points out that pirates needed to create a legitimate authority amongst themselves because the cost of having unhappy crew members was high. Even one disgruntled pirate could desert and expose the ship to the authorities. (And the penalty for piracy was death). So how did pirate gangs handle this?

Read More

0

Parrots and the Jolly Roger

Piracy is back in the news, and it’s not the intellectual kind. This is great for admiralty professors, and so I thought I’d take advantage of this brief moment in the sun to talk about some general legal issues involving pirates before discussing the ones operating off of Somalia.

Since ancient times, pirates have been considered public enemies under customary international law. This meant that ships were free to use force on the high seas to repel or capture pirates. Indeed, the phrase “public enemies” is still used in maritime contracts as a justification for non-performance in the event of a pirate attack. National governments sometimes authorized privateers to attack enemy merchant ships with letters of marque (the Constitution empowers Congress to issue these in Article One, Section Eight) but these immunity grants from domestic piracy prosecution have not been issued for decades.

Read More

The Case Against Delaware

The state of Delaware has just won a major dispute with New Jersey in the Supreme Court, over a vigorous dissent by Justice Scalia. The dispute concerned New Jersey’s plan to build a “huge gas-processing plant on the Jersey side of the Delaware River.” As the NYT reports,

New Jersey has threatened to pull state pension funds from Delaware banks. Delaware officials, meanwhile, talked about calling up its National Guard to guard its border. . . . [A] New Jersey legislator wondered aloud about recommissioning the battleship New Jersey, now a museum on the Camden waterfront, just in case.

The majority agreed . . . that New Jersey could not authorize activities “beyond the exercise of ordinary and usual riparian rights in the face of contrary regulation by Delaware.” Justice Antonin Scalia . . . professed to be flabbergasted by the majority’s reasoning. What was so “extraordinary” about a wharf to unload liquefied natural gas, he asked. “Would a pink wharf, or a zig-zagged wharf qualify? How about one for the transfer of “tofu and bean sprouts”?

It all reminds me of a classic 2002 article by Jon Chait charging Delaware with persistent disregard for other states’ interests. . . .

Read More

Flying the Stratified Skies

edna.jpgTravel has always served to remind us of the divisions our “classless society” tries so hard to downplay. Sam Walton may have driven an old truck, but you’d be hard-pressed to find most top executives or trust-funders flying in less-than-first-class digs. As the song in Chitty-Chitty Bang-Bang put it,

O the posh posh traveling life, the traveling life for me

Pardon the dust of the upper crust – fetch us a cup of tea

Port out, starboard home, posh with a capital P. . .

Admittedly, for those of us crushed into coach, there was always a happy flipside to the narrative: the profligates up front were paying so much more for their seats, effectively subsidizing the rest of us.

But that subsidy effect has been on the wane in recent years. And now wealthy fliers have found a new way to effectively assure that the rest of us are subsidizing them:

Corporate jets pay a fraction of the taxes and fees that commercial airliners do. The F.A.A. estimates that private planes, which include both corporate jets and weekend fliers, account for 16 percent of the air traffic control system’s overhead but contribute only 3 percent of the fees earmarked to run the system.

***

The Air Transport Association has . . . created a Web-based ad campaign featuring a fictional traveler, Edna, complaining about the fee disparity while the computer screen displays waves of corporate jets filling the skies before and after sporting events like the Kentucky Derby and the Masters golf tournament.

It’s enough to wilt the mint in your julep. As the campy YouTube ad sloganeers, travelers like “wearing big wigs, not subsidizing them!” Edna (pictured above) wonders “Why should the rest of us pay ten times more using the same services?”

Fortunately, the FAA has heard her pain, and is planning on “sharply increasing the fuel tax for private jets and also hitting corporate fliers with extra charges to land at any of the country’s 30 most congested airports.”