Opinion
CIVIL ACTION No. 01-3044 SECTION: I/4
April 6, 2004
ORDER AND REASONS
Before the Court is a motion, filed on behalf of third party defendants, American Bureau of Shipping ("ABS"), for a judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c), seeking dismissal of the third party claims brought against it by Osprey Line, L.L.C. ("Osprey"). The motion is opposed by Osprey and petitioner-in-limitation, Dann Marine Towing, LC ("Dann Marine"). For the following reasons, ABS's motion is DENIED.
Rec. Doc. No. 75. The motion, filed on October 22, 2003, also states that it is filed on behalf of third party defendant, ABS Group, Inc. However, ABS Group, Inc. was dismissed from this action on January 28, 2003. See Rec. Doc. No. 36.
BACKGROUND
This admiralty action arises from a collision between the barge LIBERTY TRADER and the dredge CALIFORNIA. On September 13, 2001, the M/V EAST COAST, owned by Fladel-Mar, Inc. ("Fladel-Mar") and operated by Dann Marine, was outbound in the Mississippi River Gulf Outlet with the LIBERTY TRADER in tow, at which time the LIBERTY TRADER collided with the CALIFORNIA. At the time of the collision, Columbia Leasing, Inc. ("Columbia") was the owner of the LIBERTY TRADER and Osprey was the bareboat charterer and owner pro hac vice of the LIBERTY TRADER. The CALIFORNIA was owned and operated by Great Lakes Dredge Dock Co.
See Rec. Doc. No. 1, Comp., ¶ 7.
Rec. Doc. No. 25, third party complaint, ¶ 6.
Rec. Doc. No. 1, ¶ 7.
As a result of the collision, the LIBERTY TRADER sustained damage on the starboard stern. Following the collision, the M/V EAST COAST attempted to return the LIBERTY TRADER to a terminal in New Orleans, but the barge continued to take on water and go down without a list at the stern. In order to prevent the sinking of the barge, the LIBERTY TRADER was intentionally stranded near Buoy 76 of the Mississippi River Gulf Outlet. The barge, laden with 276 cargo containers owned by Dampskibsselskabet af 1912. Aktieselskab and Aktieselskabet Dampskibsselskabet Svenborg, A.P. Moller and Maersk Inc. (collectively, "Maersk interests"), had to be offloaded because the LIBERTY TRADER continued to take on water and it had become almost completely submerged. Some of the cargo was water damaged as a result of the partial sinking of the barge.
Id, ¶ 10.
Id, ¶ 11.
Id., ¶ 12.
See id, ¶ 12; Rec. Doc. No. 39.
See Rec. Doc. No. 39, ¶ 13.
On October 5, 2001, petitioners-in-limitation, Dann Marine and Fladel-Mar, filed a complaint seeking exoneration and/or limitation of liability for all claims arising from the collision. The petitioners-in-limitation alleged that had the LIBERTY TRADER been staunch and seaworthy, the physical damage to the barge caused by the collision would not have materially affected the buoyancy of the barge and the barge would have been returned to the terminal fully laden with cargo. On that basis, the petitioners-in-limitation denied liability for the losses attributable to the unseaworthiness of the LIBERTY TRADER.
Rec. Doc. No. 1.
Id., ¶ 13.
Id.
On December 28, 2001, the Maersk interests filed a claim against Dann Marine and Fladel-Mar for its damaged cargo, alleging that the EAST COAST was unseaworthy, its crew was negligent and that it violated numerous rules of navigation. Additionally, the Maersk interests brought a third party complaint pursuant to Fed.R.Civ.P. 14(c) against Osprey and Columbia for negligence and the alleged unseaworthiness of the LIBERTY TRADER. The Maersk interests alleged that in their contract with Osprey. Osprey agreed to compensate the Maersk interests for the replacement value of all lost or damaged cargo and that Osprey agreed to name the Maersk interests as additional insureds in certain insurance policies and waive subrogation.
See Rec. Doc. No. 8, answer, claim, and third party complaint; Rec. Doc. No. 29, amended answer, claim and third party complaint; Rec. Doc. No. 39, second amended answer, claim and third party complaint.
Rec. Doc. No. 39, at p. 11.
Id at 12-13, ¶ 14.
On September 13, 2002, Osprey and Columbia filed a third party complaint pursuant to Fed.R.Civ.P. 14(c) against ABS, tendering ABS as a direct defendant to the Maersk interests. The third party complaint states that on November 7, 1997, ABS issued a certificate of classification to the LIBERTY TRADER certifying that the LIBERTY TRADER had been surveyed in accordance with the rules of the American Bureau of Shipping and that ABS entered it in the record as a class A1 Barge. In February 2001, ABS allegedly surveyed the hull and recommended that it be retained as a class A1 Barge with ABS. The third party complaint further states that on August 15, 2001, ABS again issued a certificate of classification to the LIBERTY TRADER certifying the vessel as a class A1 barge.
Rec. Doc. No. 25. Rule 14(c) provides:
When a plaintiff asserts an admiralty or maritime claim within the meaning of Rule 9(h), the defendant or person who asserts a right under Supplemental Rule C(6)(b)(i), as a third-party plaintiff, may bring in a third-party defendant who may be wholly or partly liable, either to the plaintiff or to the third-party plaintiff, by way of remedy over, contribution, or otherwise on account of the same transaction, occurrence, or series of transactions or occurrences. In such a case the third-party plaintiff may also demand judgment against the third-party defendant in favor of the plaintiff, in which event the third-party defendant shall make any defenses to the claim of the plaintiff as well as to that of the third-party plaintiff in the manner provided in Rule 12 and the action shall proceed as if the plaintiff had commenced it against the third-party defendant as well as the third-party plaintiff.
Id., ¶ 7.
Id.
Id. 8.
Columbia and Osprey allege that, as owner and bareboat charterer/owner pro hac vice, respectively, they relied on ABS's certification in using the LIBERTY TRADER in maritime commerce. Columbia and Osprey claim that to the extent they may be liable for damages as a result of the collision, they are entitled to indemnity and reimbursement from ABS because ABS was negligent in its classification, certification and inspection of the LIBERTY TRADER. Further, the third party complaint states that ABS is liable to Osprey and Colombia because ABS breached its contract with Columbia. Osprey alleges that ABS is liable to Osprey for its breaches of the ABS/Columbia contract by virtue of Osprey's status as bareboat charterer, owner pro hac vice and third party beneficiary of the contract between ABS and Columbia.
Id., ¶ 9.
Id. ¶ 12.
Id., ¶ 13.
Id.
On October 22, 2003. ABS filed the instant motion seeking a judgment on the pleadings pursuant to Fed.R.Civ.P. 12(c) and a dismissal of Osprey's third party claims. ABS argues that Osprey has failed to adequately plead a cause of action for negligent misrepresentation against ABS and that Osprey has failed to allege facts sufficient to support its claim that it is a third party beneficiary of the contract between ABS and Columbia.
ABS's motion does not challenge Columbia's third party claims.
LA WAND ANAL YSIS
Rule 12(c) of the Federal Rules of Civil Procedure provides that "[a]fter the pleadings are closed but within such time as not to delay the trial, any party may move for judgment on the pleadings." When analyzing a Rule 12(c) motion, the pleadings should be construed liberally, and a judgment on the pleadings is appropriate only if there are no material facts in dispute and questions of law are all that remain. Brittan Comm. Int'l Corp. v. Southwestern Bell Telephone Co., 313 F.3d 899, 904 (5th Cir. 2002); Voest-Alpine Trading USA Corp. v. Bank of China, 142 F.3d 887, 891 (5th Cir. 1998); Hebert Abstract Co. v. Touchstone Props., Ltd., 914 F.2d 74, 76 (5th Cir. 1990) (citing 5A Wright Miller, Federal Practice Procedure § 1367 at 510). In determining whether to grant a Rule 12(c) motion, a court "must look only to the pleadings and accept all allegations in them as true." St. Paul Fire Marine Ins. Co. v. Convalescent Serv., Inc., 193 F.3d 340. 342 (5th Cir. 1999). "[T]he central issue is whether, in the light most favorable to the plaintiff, the complaint states a valid claim for relief" Brittan, 313 F.3d at 904 (internal quotations omitted).
Rule 12(f.) provides that "[i]f, on a motion for judgment on the pleadings, matters outside the pleadings are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and disposed of as provided in Rule 56. . . . " In response to ABS's motion, Dann Marine submitted extra-pleading material in support of its opposition. Nevertheless, ABS, Osprey, and Dann Marine all argue that it is improper for the Court to treat ABS's motion as a motion for summary judgment pursuant to Rule 56. Accordingly, the Court excludes from its consideration the extra-pleading evidence and bases its ruling solely on the pleadings.
Where, as here, a defendant asserts in a motion for judgment on the pleadings that the pleadings fail to state a claim upon which relief may be granted, the Court will analyze the motion pursuant to the standards governing a motion to dismiss brought pursuant to Fed.R.Civ.P. 12(b)(6). See Jones v. M.L Greninger, 188 F.3d 322, 324 (5th Cir. 1999); Boswell v. Hon. Gov. of Texas, 138 F. Supp.2d 782, 784-85; see also Scott v. The Houma-Terrebonne Housing Authority, 2002 WL 31007412, at *3 (E.D.La. Sept. 6, 2002) (citing St. Paul Ins. Co. of Bellaire, Texas v. AFIA Worldwide Ins. Co., 937 F.2d 274, 279 (5th Cir. 1991)). Pursuant to that standard, the Court will not dismiss a complaint "unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct.99, W2, 2 L.Ed.2d 80 (1951)', Blackburn v. City of `Marshall, 42 F.3d 925, 931 (5th Cir. 1995). "The issue is not whether the plaintiff will ultimately prevail, but whether he is entitled to offer evidence to support his claim." Jones, 188 F.3d at 324 (citing Doe v. Hillsboro Indep. Sch. Dist., 81 F.3d 1395, 1401 (5th Cir. 1996)). Accordingly, the court should not dismiss the claim "unless the plaintiff would not be entitled to relief under any set of facts or any possible theory that he could prove consistent with the allegations in the complaint." Id. (citing Vander Zee v. Reno, 73 F.3d 1365, 1368 (5th Cir. 1996)): see also Indest v. Freeman Decorating, Inc., 164 F.3d 258, 261 (5th Cir. 1999)("A dismissal will not be affirmed if the allegations support relief on any possible theory."). "However. `[i]n order to avoid dismissal for failure to state a claim, a plaintiff must plead specific facts, not mere conclusory allegations. . . .'" Guidry v. Bank of LaPlace, 954 F.2d 278, 281 (5th Cir. 1992) (quoting Elliott v. Foufas, 867 F.2d 877, 881 (5th Cir. 1989)) (alteration in original). Additionally, "`legal conclusions masquerading as factual conclusions will not suffice to prevent a motion to dismiss.'" Blackburn. 42 F.3d at 931 (quoting Fernandez-Montes v. Allied Pilots Ass'n, 987 F.2d 278, 284 (5th Cir. 1993)). "[T]he complaint must contain either direct allegations on every material point necessary to sustain a recovery . . . or contain allegations from which an inference fairly may be drawn that evidence on these material points will be introduced at trial." Campbell v. City of San Antonio, 43 F.3d 973, 975 (5th Cir. 1995) (internal quotation and citation omitted). A pleading may fail to state a claim upon which relief may be granted for one of two reasons. Walker v. S. Cent. Bell Tel., 904 F.2d 275, 277 (5th Cir. 1990). "First, the law simply may not afford relief on the basis of the facts alleged in the complaint. . . . Second, regardless of whether the plaintiff is entitled to relief, the pleadings may be so badly framed that the plaintiff is not entitled to a trial on the merits." Id
ABS contends that Osprey has failed to adequately plead facts sufficient to sustain either a negligent misrepresentation claim or a contract claim on a third party beneficiary theory. Rule 8(a) of the Federal Rules of Civil Procedure provide the governing standard by which the adequacy of the pleadings is tested. Id As summarized by the Fifth Circuit:
Rule 8 requires a "short and plain statement of the claim showing that the pleader is entitled to relief." A complaint may be inadequate in one of two fashions. First, the pleadings must provide notice of the circumstances which give rise to the claim. Second, the pleader must set forth sufficient information to outline the elements of his claim or to permit inferences to be drawn that these elements exist.Id. (internal quotations and citations omitted). "The notice pleading requirements of [Rule 8] and case law do not require an inordinate amount of detail or precision." St. Paul Mercury Ins. Co. v. Williamson, 224 F.3d 425, 434 (5th Cir. 2000). "The function of a complaint is to give the defendant fair notice of the plaintiffs claim and the grounds upon which the plaintiff relies." Id. A complaint need not contain all the elements of a claim. Walker. 904 F.2d at 277. However, a complaint containing merely a "bare bones allegation" that a wrong occurred, without any factual allegations giving rise to the claim, does not provide adequate notice. Id. However, as a general rule, "if the pleadings provide adequate notice, then an inference may be drawn that all the elements of a cause of action exist." Id.
In Otto Candies, L.L.C v. Nippon Kaiji Kyokai Corp., 346 F.3d 530 (5th Cir. 2003), the Fifth Circuit held that general maritime law "cautiously recognizes the tort of negligent misrepresentation as applied to classification societies." Id. at 532. In order for Osprey to prevail on a negligent misrepresentation claim against ABS, Osprey will have to establish at trial that (1) ABS, in the course of its profession, supplied false information for Osprey's guidance in a business transaction; (2) ABS failed to exercise reasonable care in gathering the information; (3) Osprey justifiably relied on the false information in a transaction that ABS intended the information to influence; and (4) Osprey thereby suffered pecuniary loss. See id. at 535; see also Coastal (Bermuda) Ltd. v. E.W. Saybolt Co., Inc., 826 F.2d 424, 428-29 (5th Cir. 1987).
Additionally, a plaintiff claiming negligent misrepresentation must be a "person, or a member of a `limited group' of persons, for whose benefit and guidance the defendant either intends to supply the information or knows that the recipient intends to supply it." Great Plains Trust Co. v. Morgan Stanley Dean Witter Co., 313 F.3d 305. 318 (5th Cir. 2002) (quoting Scottish Heritable Trust, PLC v. Peat Marwick Main Co., 81 F.3d 606, 612 (5th Cir. 1996)).Otto Candies, 346 F.3d at 535. The fact that it is merely foreseeable or possible that a non-client of a vessel classification society may rely upon the information is insufficient to sustain a negligent misrepresentation claim. See id, at 536.
ABS contends that Osprey's claim fails because ABS has not alleged that ABS knew that Columbia had bareboat chartered the LIBERTY TRADER to Osprey or that ABS knew that Osprey was a party to whom and for whose benefit and guidance the information pertaining to the certification and classification would be provided. Additionally, ABS maintains that there are insufficient facts to permit an inference that ABS supplied any false information for Osprey's guidance in a business transaction or that ABS justifiably relied on the information in a business transaction.
Accepting the allegations in the complaint as true and drawing all reasonable inferences from the factual allegations in Osprey's favor, the Court concludes that Osprey has sufficiently pled a claim of negligent misrepresentation against ABS. Osprey alleges that ABS was negligent in its classification and certification of the LIBERTY TRADER by, inter alia, "providing services, inspections, structural analysis, investigations and recommendations." Further, Osprey alleges that ABS was negligent in applying its rules and standards to the certification and classification of the LIBERTY TRADER. Additionally; the third party complaint states that, as bareboat charterer and owner pro hac vice, Osprey relied on ABS's certification in using the LIBERTY TRADER in maritime commerce. Further, the allegations in the third party complaint permit the inference that Osprey was the bareboat charterer and owner pro hac vice at the time ABS certified the LIBERTY TRADER. These allegations are sufficient to put ABS on notice of the grounds upon which Osprey's claim rests. Although the Court agrees with ABS that the third party complaint does not contain specific allegations on even` material point that Osprey will be required to prove at trial, the allegations permit the inference that Osprey will be able introduce evidence at trial to support the required elements of a negligent misrepresentation claim. In short, the Court cannot say that it appears beyond doubt that Osprey can prove no set of facts in support of its claim which would entitle it to relief. See Conley, 355 U.S. at 45-46, 78 S.Ct. at 102 (alteration supplied).
Id., ¶ 9
The Court expresses no opinion on whether Osprey will be able to sustain its burden of proving the required elements of its negligent misrepresentation claim at trial.
ABS also asserts that Osprey has failed to adequately plead that it is a third party beneficiary to the contract between ABS and Columbia. Both Louisiana and federal maritime law recognize third party beneficiaries to contracts. See Atlantic Gulf Stevedores, Inc. v. Revelle Shipping Agency, Inc., 750 F.2d 457, 459 n. 3 (5th Cir. 1985) (discussing third party beneficiary claims in the context of general maritime law); Liquid Drill, Inc. v. U.S. Turnkey Exploration, Inc., 48 F.3d 927, 931 (5th Cir. 1995) (explaining third party beneficiary contracts pursuant to Louisiana law). Louisiana Civil Code article 1978 provides that "[a] contracting party may stipulate a benefit for a third person called a third party beneficiary." In Louisiana, this is called a stipulation pour autrui. Howard Weil Fin. Corp., 631 So.2d 1308, 1310 (La.App. 4th Cir. 1994).
For the contract to be a stipulation pour autrui, the contract must clearly express an intent to benefit a third party. The benefit to the third party must be a direct benefit; it may not be merely incidental to the contract. Further, the contract must clearly provide that the direct benefit to the third party forms the condition or consideration of the contract.Liquid Drill, 48 F.3d at 931 (internal footnotes and citations omitted). An analysis of the following factors determines whether the parties to a contract intended to benefit a third party:
(1) the existence of a legal relationship between the promisee and the third person involving an obligation owed by the promisee to the beneficiary which performance of the promise will discharge;
(2) the existence of a factual relationship between the promisee and the third person, where (a) there is a possibility of future liability either personal or real on the part of the promisee to the beneficiary against which performance of the . . . [promisor] will protect the former; (b) securing an advantage for the third person may beneficially affect the promisee in a material way; (c) there are ties of kinship or other circumstances indicating that a benefit by way of gratuity was intended.Id.
ABS argues that Osprey has not pled any facts which support its claim that it is a third party beneficiary to the ABS/ Columbia contract. ABS points out that Osprey did not attach the contract to the third party complaint and the third party complaint does not identify any contract language or provision that creates a benefit in Osprey's favor.
Although the allegations in the complaint are not detailed, the allegations are sufficient to put ABS on notice that Osprey's third party beneficiary claim arises from the contract between ABS and Columbia pursuant to which ABS provided classification and certification for the LIBERTY TRADER on November 7, 1997, February 2001, and August 15, 2001. More importantly, because the contract is not before the Court is connection. with the instant motion, the Court is unable to. conclude that Osprey can prove no set of facts, consistent with the allegations, that would entitle it to relief. Although Osprey's allegations skirt even the liberal notice requirements of Rule 8(a), the Court cannot conclude that Osprey is not entitled to offer evidence to support its claim. See Jones, 188 F.3d at 324.
Accordingly, for the above and foregoing reasons,
IT IS ORDERED that the motion, filed on behalf of third party defendants, American Bureau of Shipping ("ABS"), for a judgment on the pleadings is DENIED.