Union Pacific RR v. Kirby Inland Marine , 296 F.3d 671 ( 2002 )

United States Court of Appeals
FOR THE EIGHTH CIRCUIT
_____________
No. 01-3334
Union Pacific Railroad Company, *
*
Appellant, *
*
v. * Appeals from the United States
* District Court for the Southern
Kirby Inland Marine, Inc. of * District of Iowa
Mississippi, a/k/a/ Brent *
Transportation Company, in *
personam and the M/V Miss Dixie, *
its engines, tackle, fixtures and *
appurtenances, etc., in rem, *
*
Appellees. *
____________
Submitted: May 13, 2002
Filed:
____________
Before BOWMAN, BYE, Circuit Judges, and NANGLE,1 Senior District Judge.
____________
NANGLE, Senior District Judge.
Appellant Union Pacific Railroad Company appeals from the district court’s
1
The HONORABLE JOHN F. NANGLE, Senior United States District
Judge for the Eastern District of Missouri, sitting by designation.
conclusions of law and final judgment in the instant case. For the reasons discussed
below, we reverse in part and affirm in part the district court’s opinion.
I. Background
A. Background Facts
The parties stipulated to the following underlying facts. The Clinton Railroad
Bridge (the “Clinton Bridge”), was constructed in 1907. Pursuant to 33 U.S.C. § 401,
the construction of the Clinton Bridge was authorized by and constructed in
accordance with permits issued by the United States Coast Guard. Appellant is the
owner and operator of the Clinton Bridge.
Kirby Inland Marine, Inc. (“Kirby”) is the owner and operator of the M/V
MISS DIXIE, a river barge towboat in operation on the Mississippi River. On May
5, 1996, the M/V MISS DIXIE and/or its tow allided with the Clinton Bridge causing
damage to the bridge and the M/V MISS DIXIE. On October 10, 1999, Appellant
filed the instant action alleging the damage to its bridge was caused by the negligence
of the crew of the M/V MISS DIXIE and/or by the unseaworthiness of that vessel.
Appellees denied that the crew was negligent or that the vessel was unseaworthy and
asserted that Appellant itself was negligent in the construction, design, care and
maintenance of the Clinton Bridge.
To prove Appellant’s negligence, Appellees proffered a Coast Guard’s Order
to Alter, issued on February 28, 1996, which found that the Clinton Bridge was “an
unreasonable obstruction to navigation.” The Order to Alter was issued pursuant to
the Truman-Hobbs Act, 33 U.S.C. §§ 511-524, which authorizes the United States
Coast Guard to investigate whether a bridge is unreasonably obstructing navigation
and to order a bridge owner to alter a bridge which does indeed unreasonably obstruct
navigation.
2
The parties entered into a settlement agreement; however, the agreement was
predicated on the district court deciding one specific legal issue: “Does the Truman-
Hobbs Act finding that the bridge is ‘an unreasonable obstruction to navigation’
render inapplicable any presumption that negligence of the barge crew was the cause
of an allision between a moving vessel and a stationary bridge.” Union Pac. R.R. Co.
v. Kirby Inland Marine et. al, No. 3-99-CV-80185, slip op. at 1 (S.D. Iowa Aug. 13,
2001) The presumption in question is the longstanding Oregon rule which raises a
presumption that a vessel’s crew was negligent when a vessel strikes a stationary
object such as a bridge. The Oregon, 158 U.S. 186, 197 (1895). Under the parties’
settlement agreement, if the district court concluded that the Oregon rule does apply,
then Kirby would pay an agreed amount; alternatively, if the district court concluded
that the Oregon rule does not apply, then Kirby would pay a smaller agreed amount.
Thus, the primary issue before the district court was whether the Coast Guard’s Order
to Alter trumps the Oregon rule.
B. District Court’s decision
Although the district court initially stated that the Oregon rule should apply,
the district court eliminated the presumption by invoking the Pennsylvania rule which
is another longstanding admiralty principle. Under the Pennsylvania rule, “[w]here
any party violates a statutory or regulatory rule designed to prevent collisions, that
party has committed per se negligence . . . and [that party] has the burden of proving
that its statutory fault was not a contributing cause of the accident.” Union Pac. R.R.
Co. v. Kirby Inland Marine et. al, No. 3-99-CV-80185, slip op. at 3 (S.D. Iowa Aug.
13, 2001) (citing The Pennsylvania, 86 U.S. 125, 136 (1873)). The district court
concluded that Appellant violated 33 U.S.C. § 512 of the Truman-Hobbs Act which
states that “No bridge shall at any time unreasonably obstruct the free navigation of
any navigable waters of the United States.” 33 U.S.C. § 512. The district court found
that a violation of § 512 is sufficient to invoke the Pennsylvania rule and thus “the
normal presumption of fault that attaches to the vessel under the Oregon rule is
3
shifted back to the structure owner under the Pennsylvania rule.” Union Pac., at *3.
The district court also concluded that the Coast Guard’s Order to Alter was
admissible pursuant to Federal Rules of Evidence 402 and 803(8)(C). Id. at 4.
Appellant filed a timely notice of appeal and now asserts that the district court erred
by concluding that: (1) the Oregon rule does not apply to the instant case, and (2) the
Order to Alter is admissible.
II. Discussion
A. The Oregon Rule
We will first consider whether the district court erred by invoking the
Pennsylvania rule to trump the Oregon rule and shift the burden of persuasion back
to Appellant. We review the district court’s conclusions of law de novo. Wiles v.
Capitol Indem. Corp., 280 F.3d 868, 870 (8th Cir. 2002) (citing Lewis v. Wilson, 253
F.3d 1077, 1079 (8th Cir. 2001)).
For the Pennsylvania rule to apply, three elements must exist: (1) proof by a
preponderance of the evidence of violation of a statute or regulation that imposes a
mandatory duty; (2) the statute or regulation must involve marine safety or
navigation; and (3) the injury suffered must be of a nature that the statute or
regulation was intended to prevent. Folkstone Mar. Ltd. v. CSX Corp., 64 F.3d 1037,
1047 (7th Cir. 1995) (emphasis added). The Truman-Hobbs Act does not satisfy the
prerequisites of the Pennsylvania rule because it was not drafted: (1) to maintain
marine safety; (2) to impose a specific duty; or (3) to prevent a specific sort of injury.
We find that the Truman-Hobbs Act is a funding statute and not a safety
statute. Congress stated that it drafted the Truman-Hobbs Act “to provide an orderly
method for the just apportionment of the cost of the reconstruction or alteration of
4
bridges over navigable waters where navigation conditions require such
reconstruction or alteration of bridges heretofore built in accordance with law. . . .”
House Report No. 1447, August 2, 1939, 76th Cong. 1st Sess.
The regulations implementing the Truman-Hobbs Act establish a lengthy
administrative procedure for determining whether a bridge is “an unreasonable
obstruction to navigation.” See 33 C.F.R. § 116.01-116.55 (setting out complaint
process, preliminary investigation, detailed investigation, public hearing, and
administrative review). Ultimately, the Chief Officer of the Bridge Administration
(the “Chief”) performs a cost/benefit analysis to determine whether the benefits to
navigation exceed the government’s cost of altering the bridge. 33 C.F.R. § 116.30.
If the benefits exceed the costs, then the Chief recommends that the Coast Guard
issue an Order to Alter stating that the bridge unreasonably obstructs navigation. Id.
Once the Coast Guard concludes that a bridge is an unreasonable obstruction to
navigation, the bridge owner must: (1) submit plans and specifications for altering the
bridge; (2) solicit and submit bids; and (3) request an Apportionment of Costs which
outlines which costs will be borne by bridge owner and the United States government.
See 33 U.S.C. §§ 514-516; 33 C.F.R. §§ 116.40, 116.45, 116.50.
Looking at the Truman-Hobbs Act as a whole, a § 512 finding that a bridge is
an “unreasonable obstruction to navigation” is not a direct comment on the safety of
the bridge. Instead, the Coast Guard labels a bridge an unreasonable obstruction in
order to facilitate the funding process. Accordingly, we conclude that the Truman-
Hobbs Act does not satisfy the first element of the Pennsylvania rule because it was
not drafted to protect marine safety, but to establish a procedure to provide
government funds to assist bridge owners in altering their bridges.
The Truman-Hobbs Act also does not satisfy the other two prerequisites of the
Pennsylvania rule as it does not impose a specific duty or prevent a specific sort of
injury. Once the Coast Guard concludes that a bridge violates § 512, the bridge
5
owner is required only to prepare a plan for altering the bridge. This “duty” is very
different from a duty to maintain lights and signals on a bridge or to promptly open
a draw. See 33 U.S.C. § 494 (requiring a bridge owner to maintain “such lights and
other signals thereon as the Commandant of the Coast Guard shall prescribe” and to
promptly open such draw upon reasonable signal for the passage of boats and other
water craft). With respect to the latter duties, the application of the Pennsylvania rule
is justified because a bridge owner greatly increases the risk of allision by failing to
promptly open a draw or by neglecting to maintain the bridge’s lights. Conversely,
a bridge owner’s failure to prepare a plan for altering a bridge will delay the funding
process, but will not directly increase the risk of allision.
Also, the goal of the Truman-Hobbs Act was to decrease the cost of navigation
by using government funds to alter bridges which unreasonably obstruct such
navigation. Although the bridge alterations may reduce the amount of allisions, this
is a collateral consequence and not a direct purpose of the Truman-Hobbs Act. To
state it another way, the Truman-Hobbs Act was not designed to prevent any specific
type of injury. Thus, any injury suffered in admiralty is not “of a nature that the
[Truman-Hobbs Act] was intended to prevent.” Folkstone Mar. Ltd. v. CSX Corp.,
64 F.3d 1037, 1047 (7th Cir. 1995).
In concluding that the district court incorrectly invoked the Pennsylvania rule,
we further note that the district court did not cite a single case in which a court
applied the Pennsylvania rule solely because a bridge violated the Truman-Hobbs
Act. In Nassau County Bridge Authority v. Tug Dorothy McCallister, 207 F. Supp.
167, 172 (E.D.N.Y. 1962), the district court applied the Pennsylvania rule because
the bridge tender violated 33 U.S.C. §§ 494 by failing to promptly open a draw for
an approaching ship. In Folkstone Maritime, Limited v. CSX Corp., 64 F.3d 1037,
(7th Cir. 1995), the court applied the Pennsylvania rule because the bridge owner
violated 33 U.S.C. § 491 which provides that “it is unlawful for a bridge to deviate
6
from its plans and specifications for its construction . . . unless the modification of the
bridge is previously submitted to and approved by the Secretary of Transportation.”
The Folkstone court concluded that the bridge owner violated § 491 by failing to
abide by the Coast Guard’s order to construct a draw which could be raised to 83
degrees. Folkstone, 64 F.3d at 1048-49. Unlike the present case, Nassau and
Folkstone involve active negligence on the part of bridge owners.
Although these cases cited § 512, neither court explained how a violation of
that particular statute served to invoke Pennsylvania rule.2 Accordingly, we find that
the district court did not present any authority to support its conclusion that a
violation of the Truman-Hobbs Act invokes the Pennsylvania rule.
We will not invoke the Pennsylvania rule to punish a bridge owner who
controls a lawful bridge. Under the Truman-Hobbs Act, a bridge labeled an
unreasonable obstruction is still a lawful bridge. 33 U.S.C. § 511. In order to obtain
funding under the Truman-Hobbs Act, the bridge must be “lawful” and used as a
railroad or a public highway. Id. To maintain a lawful bridge, bridge owners must
abide by the laws and regulations governing bridges. The Clinton Bridge was built
in 1907 in accordance with then-current Department of Transportation procedures and
it currently complies with the Coast Guard’s regulations. Appellees do not assert that
Appellant caused this allision through active negligence; instead, they fault the bridge
owner for failing to alter the Clinton Bridge to accommodate the ever-increasing size
of commercial barges and tows. We will not employ the Pennsylvania rule to punish
a bridge owner who maintains a lawful bridge, even though the Coast Guard has
found such a bridge to be an unreasonable obstruction due to the barge industry’s
expansion of the size of its commercial vessels.
2
The district court also cited City of Boston v. S.S. Texaco Texas, 773 F.3d
1396 (1st Cir. 1985) to support its application of the Pennsylvania rule; however,
the City of Boston case does not discuss the Pennsylvania rule so we will not
discuss it here.
7
In sum, we find that the district court should not have relied on a violation of
the Truman-Hobbs Act to invoke the Pennsylvania rule. Accordingly, the district
court erred by concluding that a violation of § 512 invokes the Pennsylvania rule and
shifts the burden of persuasion back to Appellant. Instead, the district court should
have applied the Oregon presumption.
We now address Appellees’ assertion that we should affirm the district court’s
judgment because the Coast Guard’s declaration that the bridge is an unreasonable
obstruction to navigation rebuts the Oregon presumption and shifts the burden of
proof back to the bridge owner. In order to affirm the district court’s judgment, we
would have to conclude, as a matter of law, that the Coast Guard’s Order to Alter
rebuts the Oregon presumption. Because we believe the trier of fact should determine
whether the Oregon presumption is rebutted by the Coast Guard’s Order to Alter, we
cannot affirm the district court’s legal conclusion that the Oregon rule does not apply.
Appellees rely on I &M Rail Link, LLC v. Northstar Navigation, Inc, 198 F.3d
1012 (7th Cir. 2000) to support their position that the Coast Guard’s Order to Alter
rebuts the Oregon presumption and shifts the burden of proof back to the bridge
owner. The Seventh Circuit case is strikingly similar to the case at bar as it arose
from an allision between a large seagoing vessel and the Sabula Bridge, a century-old
railroad bridge. Id. at 1013. Ten months prior to the allision, the Coast Guard had
issued an Order to Alter finding that the Sabula Bridge was “an unreasonable
obstruction to navigation.” Id. at 1014. The district court applied the Oregon
presumption and granted summary judgment against the defendant vessel. Id.
Although the defendant “sought to rebut the Oregon presumption by arguing that the
Sabula Bridge is an unreasonable obstruction to navigation,” the district court decided
to ignore the Coast Guard’s Order to Alter because it was part of the Truman-Hobbs
Act and therefore had no significance in a negligence action. Id. The Seventh Circuit
disagreed.
Writing for the panel, Judge Easterbrook reversed the district court’s grant of
8
summary judgment and remanded the case for trial because the defendant presented
sufficient evidence to raise a question of fact on the issue of negligence. Judge
Easterbrook noted that the Coast Guard’s Order to Alter was not an “unelaborated
ukase,” but a conclusion based on evidence that: (1) the Sabula Bridge repeatedly is
struck; and (2) the bridge’s outdated structure does not allow modern-day vessels to
navigate easily through the bridge. Id. at 1015-16. Ultimately, Judge Easterbrook
concluded that:
If the Coast Guard may find the Sabula Bridge an
unreasonable obstruction based on the cost and accident
data, then so may the trier of fact in admiralty . . . .
Findings in the Coast Guard’s report are more than
adequate to overcome The Oregon’s presumption. . . . The
trier of fact must give an answer without resort to
presumptions. Although the Coast Guard’s findings may
well be conclusive for some purposes . . . the question
remains whether the shortcomings of the bridge caused this
accident.
Id. at 1016 (emphasis added) (citations omitted).
Appellees maintain that the I & M Rail Link case stands for the proposition
that, as a matter of law, the Coast Guard’s Order to Alter rebuts the Oregon
presumption and thus the litigation should proceed on a level playing field. This view
seems to be based on the single sentence “The trier of fact must give an answer
without resort to presumptions.” We, however, interpret the Seventh Circuit’s
opinion differently.
In our view, the I & M Rail Link case stands for the proposition that a
defendant can attempt to rebut the Oregon presumption by presenting evidence that
the Coast Guard labeled the bridge an “unreasonable obstruction to navigation.”
9
Under I & M Rail Link, a Coast Guard Order to Alter is not conclusive evidence of
negligence, but merely another piece of evidence which the trier of fact may consider
in determining fault in a negligence action. See I & M Rail Link, 198 F.3d at 1016
(“Although the Coast Guard’s findings may well be conclusive for some purposes .
. . the question remains whether the shortcomings of the bridge cause this accident.”).
Our interpretation is shared by the lower court which, on remand, tried the case in
accordance with the Seventh Circuit’s opinion. See I & M Rail Link v. Northstar
Navigation, No. 98-C-50359, 2001 WL 460028, at *4 (N.D. Ill. April 27, 2001) (“It
is true the Seventh Circuit referred to the previous accidents at the Sabula Bridge
included in the Coast Guard’s reports, and said the trier of fact may find the Sabula
Bridge an unreasonable obstruction based on the Coast Guard’s cost and accident
data. . . . But it did so in the context of explaining its holding on a rather narrow issue:
that this evidence could be used to rebut the presumption of The Oregon . . . .”)
(emphasis added). To the extent that the I & M Rail Link case can be interpreted to
hold that a Coast Guard’s Order to Alter rebuts and overcomes the Oregon
presumption, as a matter of law, we respectfully disagree.
Our interpretation of I &M Rail Link is in accordance with longstanding
precedent which allows a moving vessel to rebut the Oregon presumption by
presenting evidence that the bridge was an unreasonable obstruction to navigation.
Wilmington Ry. Bridge Co. v. Franco-Ottoman Shipping Co., 259 F. 166, 168 (4th
Cir. 1919). In Wilmington Ry. Bridge Co., the Fourth Circuit stated that the Oregon
presumption may be rebutted:
by proof that the location of the stationary vessel, the
obstruction of navigation by the bridge, or other causes had
brought the moving vessel into an emergency not to be
reasonably foreseen, and that the course taken by the
navigator in the emergency was such as might well have
been taken by a prudent and skillful navigator.
10
Id. (emphasis added).
In its own words, the district court stated that “[t]he single legal question they
ask this court to answer is: Does the Truman-Hobbs Act finding that the bridge is “an
unreasonable obstruction to navigation” render inapplicable any presumption that
negligence of the barge crew was the cause of a collision between a moving vessel
and a stationary bridge?” Union Pac., No. 3-99-CV-80185 at 1. To state it another
way, the district court was considering whether, as a matter of law, a Truman-Hobbs
Act finding trumps the Oregon presumption. We conclude that a Truman Hobbs Act
finding does not render inapplicable the Oregon rule and therefore reverse the district
court’s conclusion to the contrary in this case.
In remanding we recognize that Appellees have produced evidence regarding
the “obstructive character” of the Clinton Bridge. Appellees note that the Coast
Guard’s Detailed Report: (1) documents more than 300 allisions between the Clinton
Bridge and various vessels in a ten year period; (2) emphasizes the fact that the
Clinton Bridge is out of date and does not permit the smooth navigation of modern-
day commercial vessels; and (3) criticizes the poor position of the Clinton Bridge.3
The parties, however, did not ask the district court to consider whether Appellees
presented sufficient evidence to rebut the Oregon presumption; thus, that question is
not currently before this Court. Instead, the parties posed the single legal question
of whether a Truman-Hobbs Act finding that a bridge is an unreasonable obstruction
to navigation renders inapplicable the Oregon presumption. We conclude that the
answer to that particular question is “no.”
Accordingly, we find that the district court erred by concluding as a matter of
law that the Oregon presumption does not apply. See Wilmington Ry. Bridge Co.
v. Franco-Ottoman Shipping Co., 259 F.2d 166, 168 (4th Cir. 1919). The opinion of
3
We note that the Coast Guard’s detailed report was not included in the
parties’ Stipulated Facts.
11
the district court is reversed.
B. Federal Rule of Evidence 803(8)(C)
Appellant also asserts that the district court erred by admitting the Coast
Guard’s Order to Alter into evidence.4 We review the district court’s evidentiary
rulings “under the abuse of discretion standard, according the district court substantial
deference.” Gagnon v. Sprint Corp., 284 F.3d 839, 856 (8th Cir. 2002) (citing
Shelton v. Consumer Prods. Safety Comm'n, 277 F.3d 998, 1009 (8th Cir. 2002). In
its opinion, the district court specifically stated that the “[t]he Coast Guard findings
are admissible under Federal Rules of Evidence 402 and 803(8)(C).” Union Pac. R.R.
Co. v. Kirby Inland Marine et. al, No. 3-99-CV-80185, slip op. at 4 (S.D. Iowa Aug.
13, 2001). The court further concluded that the findings are “trustworthy” because
“they are based on factual investigation, and they are directly relevant to the issues
here.” Id.
Rule 803(8)(C) of the Federal Rules of Evidence defines the “public records
and reports” which are not excludable under the hearsay rule. Rule 803(8)(C)
specifically excludes “factual findings resulting from an investigation made pursuant
to authority granted by law, unless the sources of information or other circumstances
indicate lack of trustworthiness.” In Beech Aircraft Corp. v. Rainey, 488 U.S. 153,
170, 109 S. Ct. 439, 450, 102 L. Ed. 2d 445 (1988), the Supreme Court specifically
concluded that opinions, conclusions, and findings of fact are admissible under Rule
803(8)(C). The Court further stated that “[a]s long as the conclusion is based on a
factual investigation and satisfies the Rule’s trustworthiness requirement, it should
be admissible along with other portions of the report.” Id.
4
Although Appellant seems to oppose the district court’s admission of other
documents, we find that the district court’s opinion relates only to the February 28,
1996 Order to Alter. See Union Pac. R.R. Co. v. Kirby Inland Marine et. al, No.
3-99-CV-80185, judgment (S.D. Iowa Aug. 13, 2001).
12
The party opposing the admission of the report has the burden of proving the
report’s untrustworthiness. Moss v. Ole South Real Estate, Inc., 933 F.2d 1300, 1304
(5th Cir. 1991). When considering whether a report is trustworthy, the court should
not consider whether the report is credible, but rather should consider whether the
report is reliable. Id. at 1306-07. “The Rule 803 trustworthiness requirement,
therefore, means that the trial court is to determine primarily whether the report was
compiled or prepared in a way that indicates that its conclusions can be relied upon.”
Id. at 1307.
We find that the district court did not abuse its discretion by concluding that
the Coast Guard’s Order to Alter is admissible pursuant to Rule 803(8)(C). The Coast
Guard’s investigation into the Clinton Bridge was mandated by law. See 33 C.F.R.
§ 116.10 (“Upon receipt of a written complaint, the District Commander will review
the complaint to determine if . . . the complaint is justified and whether a Preliminary
Investigation is warranted.”). As was discussed above, the Truman-Hobbs Act
established a thorough review process to determine whether a bridge should be
altered because it is an unreasonable obstruction to navigation. This process includes
a preliminary investigation, detailed investigation, public hearing, and an
administrative review. See 33 C.F.R. §§ 116.01-116.55. The fact that Coast Guard
investigators relied on hearsay evidence to reach their conclusions does not mean that
the preparation of the report was untrustworthy. Moss, 933 F.2d at 1309.
In sum, Appellant has not presented any evidence that the Coast Guard’s Order
to Alter contained findings and conclusions which were untrustworthy. Accordingly,
we conclude that the district court did not abuse its discretion by admitting the
document, and we therefore affirm the district court’s conclusion to admit the Order
to Alter into evidence.
III. Conclusion
For the foregoing reasons, the district court’s conclusions of law and final
13
judgment are reversed in part and affirmed in part.
A true copy.
Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.
14