Admrialty jurisdiction Boating Accident, Boating Accident Law

Every experienced maritime attorney will recognize the significance of this case.
It demonstrates how admiralty jurisdiction can apply to a boating accident.
Limitation of liability is traditionally a maritime law concept. However, the Supreme
Court shows that it is willing to allow the application of maritime law to a boat fire.
This case has significant relevance for maritime lawyers representing victims injured
in boating accidents on navigable waters. It also applies to diving, jet-ski, kayak or
canoe accidents.

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Sisson v. Ruby, et al

EVERETT A. SISSON, PETITIONER V. BURTON B. RUBY, ET AL.

No. 88-2041

In The Supreme Court Of The United States

October Term, 1989

On Petition For A Writ Of Certiorari To The United States Court Of
Appeals For The Seventh Circuit

Brief For The United States As Amicus Curiae

This brief is submitted in response to the Court's order inviting
the Solicitor General to express the views of the United States.

TABLE OF CONTENTS

Questions Presented
Statement
Discussion
Conclusion

QUESTIONS PRESENTED

1. Whether the Limitation of Liability Act, 46 U.S.C. App. 181 et
seq. (Supp. IV 1986), confers federal subject matter jurisdiction over
a proceeding to limit any tort liability of the owner of a
recreational vessel arising from a fire that started aboard the vessel
while it was docked at a marina.

2. Whether 28 U.S.C. 1333(1) confers federal admiralty jurisdiction
over that proceeding.

STATEMENT

1. Petitioner Everett A. Sisson was the owner of the Ultorian, a
56-foot pleasure yacht. On September 24, 1985, the Ultorian caught
fire while it was docked at the Washington Park Marina in Michigan
City, Indiana. The yacht was destroyed, and the fire caused extensive
damage to the marina and to other vessels in the vicinity. The owners
of the marina and the damaged vessels estimate that their losses
exceed $275,000. Pet. App. 1a-2a, 25a.

Petitioner commenced this action in a federal district court to
obtain the benefits of the Limitation of Liability Act, 46 U.S.C. App.
181 et seq. /1/ The complaint alleged that the fire had occurred
without petitioner's privity or knowledge. See 46 U.S.C. App. 183(a).
It sought a judgment enjoining the pursuit of claims against
petitioner for damages arising from the fire, adjudicating
petitioner's liability on those claims, limiting petitioner's total
liability to the value of his interest in the Ultorian after the
casualty (approximately $800), and dividing that sum among any
successful claimants. /2/ The complaint invoked "the admiralty and
maritime jurisdiction of the United States." Compl., Paragraphs 8, 10,
13, prayer.

2. In orders dismissing the complaint and denying petitioner's
motion for reconsideration, the district court held that it lacked
subject matter jurisdiction. Pet. App. 25a-35a, 37a-41a. In its
initial order, the court held that it lacked general admiralty
jurisdiction over the action. The district court noted that, under
this Court's decisions in Foremost Insurance Co. v. Richardson, 457
U.S. 668 (1982), and Executive Jet Aviation, Inc. v. City of
Cleveland, 409 U.S. 249 (1972), admiralty jurisdiction over tort
claims extends only to wrongs that occur on navigable waters and that
bear a "significant relationship to traditional maritime activity."
Pet. App. 26a-27a. Observing that the instrumentality blamed for the
fire, a washer/dryer, was not "distinctly maritime in character" and
that the casualty did not involve the navigation of a vessel, the
court held that the matters giving rise to petitioner's potential
liability did not bear the necessary relationship to traditional
maritime activity. Id. at 31a-32a.

In a motion for reconsideration, petitioner argued that the
Limitation of Liability Act, 46 U.S.C. App. 183, provided an
independent source of subject matter jurisdiction over the action.
The district court denied the motion on three alternative grounds:
(1) petitioner's jurisdictional theory could not be presented for the
first time in a motion for reconsideration; (2) the Limitation of
Liability Act does not confer subject matter jurisdiction over
non-maritime tort claims; and (3) the Limitation of Liability Act
does not apply to a pleasure craft used for recreational purposes.
Pet. App. 37a-41a.

3. The court of appeals affirmed. Pet. App. 1a-21a. Addressing
first the availability of admiralty jurisdiction under 28 U.S.C. 1333,
the court observed that such jurisdiction was not "precluded * * *
simply because the tort (in this case) involves pleasure, rather than
commercial, vessels." Pet. App. 6a. However, the court of appeals
read Foremost "to limit admiralty jurisdiction in non-commercial
maritime tort cases to torts involving navigation." Id. at 7a-8a.
Thus, in the court's view, that jurisdiction extends only (id. at 8a)

to cases directly involving commercial maritime activity, or
to cases involving exclusively non-commercial activities in
which the wrong (1) has a potentially "disruptive impact" on
maritime commerce and (2) involves the "traditional maritime
activity" of navigation.

Because it determined that this case "involves only non-commercial
activities," the panel applied the second prong of its test. Pet.
App. 8a. The court observed that "a fire on board a moored vessel
could disrupt commercial navigation," but it adhered to its "narrow
reading of 'traditional maritime activity,' limiting application to
cases involving navigation." Id. at 8a-9a. /3/ Since the Ultorian was
docked in a marina at the time of the fire, the court held that it
lacked admiralty jurisdiction over the action.

The court of appeals also held that the Limitation of Liability Act
did not independently confer subject matter jurisdiction over the
action. The panel recognized that in Richardson v. Harmon, 222 U.S.
96 (1911), this Court held that the Act vested district courts with
jurisdiction to entertain proceedings to limit liabilities arising
from non-maritime torts. However, the court of appeals ruled that the
enactment of the Extension of Admiralty Jurisdiction Act, 46 U.S.C.
740, eliminated "the need that inspired that decision," and it
questioned whether cases predating Executive Jet and Foremost retained
their precedential force. Pet. App. 16a-17a. The court concluded
that the "nexus" required for admiralty jurisdiction was also a
prerequisite for jurisdiction under the Limitation of Liability Act.
The court explained that "when a cause of action in tort does not bear
any connection to traditional maritime activity, there is no
justification for allowing the Limitation of Liability Act -- which
provides for a practice apparently defensible only in a traditional
maritime context -- to provide an independent basis for admiralty
jurisdiction." Id. at 18a. /4/

DISCUSSION

The court of appeals' holding that federal courts lack jurisdiction
over non-maritime tort claims in limitation of liability proceedings
conflicts with this Court's decision in Richardson v. Harmon, supra,
and the decisions of lower federal courts. In addition, the court of
appeals employed criteria different from those applied in other
circuits to determine whether the casualty in this case bore the
"significant relationship to traditional maritime activity" required
for general federal admiralty jurisdiction. Although the practical
impact of these differing standards remains unclear, the conflict has
been perceived as significant in the lower courts.

We believe that this Court's review is warranted because of the
conflict with Richardson, and because there is a need to dispel
confusion as to the reach of the Court's decisions in Executive Jet
and Foremost. If the Court does decide to grant review, it may also
wish to direct the parties to brief the issue whether Richardson
should be reconsidered. Although there are substantial arguments on
both sides of that issue, the appropriateness of applying the
Limitation of Liability Act to non-maritime tort claims is, in our
view, a matter that deserves fresh consideration.

The scope of the district courts' general admiralty jurisdiction
over maritime torts need not be reached if the Limitation of Liability
Act applies to -- and independently confers subject matter
jurisdiction over -- this case. Accordingly, we address that issue
first.

1. Section 183(a) of the Limitation of Liability Act, 46 U.S.C.
App. 183(a), provides that "(t)he liability of the owner of any
vessel" for any damages occasioned without the owner's "privity or
knowledge" shall not exceed "the amount or value of the interest of
such owner in such vessel, and her freight then pending." To enforce
that limitation, an owner is authorized by Section 185 of the Act, 46
U.S.C. App. 185, to "petition a district court of the United States of
competent jurisdiction" to limit his liability. When (as in this
case) there are multiple claims against the owner and the amount of
those claims exceeds the value of his interest in the vessel, the
court has authority to enjoin the commencement and prosecution of any
other actions arising out of the casualty; to determine whether the
owner is entitled to the statutory limitation on liability (which in
many cases turns on whether the casualty was within his "privity or
knowlege"); to adjudicate claims against the owner or vessel; and to
apportion the owner's interest in the vessel among successful
claimants in proportion to their claims. See G. Gilmore & C. Black,
The Law of Admiralty Section 10-17 (2d ed. 1975). Federal
jurisdiction over such a proceeding is exclusive. See Providence &
New York Steamship Co. v. Hill Manufacturing Co., 109 U.S. 578,
594-595 (1883).

Here, the court of appeals held that exclusive federal jurisdiction
does not extend to tort claims that lack a "significant relationship
to traditional maritime activity." Although the court framed the
question as one of federal jurisdiction, the issue may just as
properly be viewed as one of the substantive reach of the Act. The
statute has been construed to provide for a proceeding in which the
fund available to satisfy a shipowner's liability may be apportioned
among all claims subject to the owner's limitation on liability. See
Just v. Chambers, 312 U.S. 383, 386 (1941). Thus, in our view, the
scope of federal jurisdiction under the Limitation of Liability Act is
the same as the scope of the liabilities that are subject to
limitation. /5/ The question presented by this case, then, is whether
the Act applies to liabilities arising from non-maritime claims.

In its early decisions under the Act, this Court determined that
the statute was to be administered by federal courts sitting in
admiralty and construed it to apply only to liabilities within the
general admiralty jurisdiction of those courts. In Norwich Co. v.
Wright, 80 U.S. (13 Wall.) 104 (1871), the Court resolved the
question, on which the statute was silent, of the appropriate forum
for enforcement of the Act. The Court concluded (id. at 123-124):

The act does not state what court shall be resorted to, nor
what proceedings shall be taken; but that the parties, or any
of them, may take "the appropriate proceedings in any court, for
the purpose of apportioning the sum for which, &c." Now, no
court is better adapted than a court of admiralty to administer
precisely such relief. * * * Congress might have invested the
Circuit Courts of the United States with the jurisdiction of
such cases by bill in equity, but it did not. It is also
evident that the State courts have not the requisite
jurisdiction. Unless, therefore, the District Courts themselves
can administer the law, we are reduced to the dilemma of
inferring that the legislature has passed a law which is
incapable of execution. This is never to be done if it can be
avoided. We have no doubt that the District Courts, as courts
of admiralty and maritime jurisdiction, have jurisdiction of the
matter * * * . /6/

Consistent with Norwich's observation that the district courts had
jurisdiction over limitation of liability actions, "as courts of
admiralty and maritime jurisdiction," this Court later held that
federal court jurisdiction in such proceedings (and thus, of
necessity, the substantive reach of the Act itself) extended only to
maritime liabilities on which suit could have been brought on the
admiralty side of the federal district courts. In Ex parte Phenix
Insurance Co., 118 U.S. 610 (1886), the owner of a steamer sought to
litigate the question of its negligence, and to limit its liability
for damages, in connection with a fire caused by sparks from the
steamer's smokestack. Because the fire occurred on land, claims for
resulting damages fell outside federal admiralty jurisdiction as then
defined. Id. at 618-619. See The Plymouth, 70 U.S. (3 Wall.) 20, 35
(1865). The Court noted that the predecessor of Section 183(a) "(did)
not purport to confer any jurisdiction upon a District Court" and that
the predecessor of Section 185 referred only to "any court of
competent jurisdiction," "leaving the question of such competency to
depend on other provisions of law." 118 U.S. at 617. The court held,
accordingly, that neither the Limitation of Liability Act nor the
Admiralty Rules promulgated by the Court extended the general
admiralty jurisdiction of the district courts to a proceeding to limit
a vessel owner's liability for a non-maritime tort. The Court added
that nothing in its earlier decisions "support(ed) the view that a
District Court can take jurisdiction in admiralty of a petition for a
limitation of liability where it would not have had cognizance in
admiralty originally of the cause of action involved." Id. at 624.

Similarly, in Butler v. Boston Steamship Co., 130 U.S. 527, 557
(1889), the Court observed that "the law of limited liability of
shipowners is a part of our maritime code," and "is necessarily
coextensive with that of the general admiralty and maritime
jurisdiction." Under the regime of Norwich, Ex parte Phenix, and
Butler, therefore, the scope of the liabilities subject to the
Limitation of Liability Act was defined by reference to the general
admiralty jurisdiction of the federal courts.

In Richardson v. Harmon, supra, however, the Court uncoupled the
Limitation of Liability Act from general admiralty jurisdiction. In
that case, the owners of a steam barge sought to limit their liability
arising out of a collision between the barge and a bridge. Because
the bridge was considered to be "on land" for purposes of admiralty
jurisdiction, a claim for damage to the bridge was non-maritime under
the "locality" test of The Plymouth, supra. The Court acknowledged
that, prior to the effective date of an 1884 amendment to the
Limitation of Liability Act (an amendment now codified at 46 U.S.C.
App. 189), the district court would have had no jurisdiction to limit
the barge owner's liability for damage to the bridge. However, the
Court construed the 1884 amendment to extend the Limitation of
Liability Act -- and, implicitly, federal jurisdiction in proceedings
under the Act -- to "'any and all debts and liabilities' not
theretofore included" -- including non-maritime tort claims. 222 U.S.
at 105. "Thus construed," the Court explained, "the section
harmonizes with the policy of limiting the owner's risk to his
interest in the ship in respect of all claims arising out of the
conduct of the master and crew, whether the liability be strictly
maritime or from a tort non-maritime, but leaves him liable for his
own fault, neglect and contracts." Id. at 106.

After Richardson, it was frequently held that "(p)roceedings by
vessel owners to limit their liability as permitted by (the Limitation
of Liability Act) are within the admiralty jurisdiction even if the
claims limited against might not be sued upon in admiralty." 1 S.
Friedell, Benedict on Admiralty Section 225 (7th ed. 1988). See Just
v. Chambers, 312 U.S. at 386 (Limitation of Liability Act "extends to
tort claims even when the tort is non-maritime"); The No. 6, 241 F.
69 (2d Cir. 1917); The Rochester, 230 F. 519, 521 (W.D.N.Y. 1916);
The Irving F. Ross, 8 F.2d 313 (D. Mass. 1923); In re Highland Nav.
Corp., 24 F.2d 582 (S.D.N.Y. 1927); The Atlas No. 7, 42 F.2d 480
(S.D.N.Y. 1930); In re Colonial Trust Co., 124 F. Supp. 73, 75 (D.
Conn. 19554); The Trim Too, 39 F. Supp. 271, 273 (D. Mass. 1941).
/7/

By contrast, the court of appeals' decision in this case holds that
the Limitation of Liability Act is restricted to maritime tort
liabilities over which federal jurisdiction would lie under 28 U.S.C.
1333. The Eleventh Circuit has since reached the same conclusion on
very similar facts. Lewis Charters, Inc. v. Huckins Yacht Corp., 871
F.2d 1046 (11th Cir. 1989). /8/ These decisions are inconsistent with
the Second Circuit's decision in The No. 6, supra, and district court
decisions that have followed Richardson.

The decisions in this case and Lewis Charters have suggested that
Richardson is no longer controlling in light of two intervening
developments in the scope of admiralty tort jurisdiction: (1) the
enactment of the Extension of Admiralty Act, 46 U.S.C. 740, which
extends the original maritime jurisdiction of the district courts to
"all cases of damage or injury, to person or property, caused by a
vessel on navigable water, notwithstanding that such damage or injury
be done or consummated on land," and (2) this Court's decisions, in
Executive Jet and Foremost, requiring a "significant relationship to
traditional maritime activity" for federal admiralty jurisdiction, see
pp. 16-17, infra.

We disagree. In our view, Richardson squarely rejected the
proposition that district courts may not take jurisdiction over
non-maritime tort claims in limitation of liability proceedings. The
fundamental basis for that holding, the 1884 amendment to the
Limitation of Liability Act, remains on the books as 46 U.S.C. App.
189. And, Executive Jet expressly recognized that the "significant
relationship to traditional maritime activity" standard would not
apply when there was "legislation to the contrary." 409 U.S. at 268,
274 & n.26. /9/

We believe that the conflict between the court of appeals' decision
and Richardson warrants further review. The effort of the court below
to distinguish Richardson does not stand in isolation; the court's
approach is already being followed by the Eleventh Circuit. And a
number of lower court decisions, especially involving pleasure boat
incidents, have sought to limit the reach of the Limitation of
Liability Act in ways that seem to us hard to square with Richardson's
rationale (see notes 10, 12, infra).

If the Court decides to hear this case, there are several reasons
why it may wish to direct the parties to address the question whether
Richardson should be modified or overruled. First, the original basis
for that decision is subject to question. Notwithstanding its
open-ended language, the Limitation of Liability Act was initially
understood to be a part of the "maritime code" and thus to be
coextensive with the general admiralty jurisdiction of the federal
courts. See pp. 7-9, supra. The language of the 1884 amendment on
which Richardson was based does not seem to justify a fundamentally
different view of the relationship between the Act and that
jurisdiction. /10/ Second, insofar as the extension of the Act to
non-maritime claims in Richardson was based on concern with artificial
limitations on admiralty jurisdiction arising from the "locality"
test, the Extension of Admiralty Act has ameliorated that concern.
Third, as the court of appeals noted, the "great object of the
(Limitation of Liability Act) was to encourage ship-building and to
induce capitalists to invest money in this branch of industry."
Norwich Co. v. Wright, 80 U.S. (13 Wall.) at 121. See 3 A. Jenner &
J. Loo, Benedict on Admiralty Sections 6-7 (7th ed. 1988). That
purpose was the principal basis for the decision in Richardson. Under
the "locality" test for admiralty jurisdiction that then prevailed,
restricting limitation of liability proceedings to claims cognizable
in admiralty would have left shipowners exposed to many foreseeable
claims arising from the normal commercial operation of their vessels.
By contrast, allowing limitation of liability for claims arising from
wrongs having no "significant relationship to traditional maritime
activity" seems unnecessary to advance the interests of the merchant
marine. /11/ Finally, because the jurisdiction of the limitation
court in cases of this type is exclusive, the consequence of federal
jurisdiction is to subject tort claims arising under state law to the
statutory cap and to bring them to federal court. In a case that does
not satisfy the "significant relationship" test, any federal interest
in the scope of a shipowner's liability for such claims or in
adjudication of that liability in a federal forum is attenuated.

We by no means suggest that the question is one-sided. The
language of the Limitation of Liability Act does not expressly limit
it to maritime claims. Thus, as was the case prior to Richardson,
such a limitation would have to be derived from the original
understanding of the Act's relation to the admiralty jurisdiction of
the courts responsible for the Act's administration. Moreover, a very
broad view of the Act's purpose of advancing commercial shipping might
support its application to non-maritime liabilities; if so, federal
courts should have jurisdiction over such claims in order to perform
their function of assuring a comprehensive adjudication of multiple
claims against a shipowner and an orderly distribution of the sum
earmarked for his liabilities. See Maryland Casualty Co. v. Cushing,
347 U.S. 409, 416 (1954); Just v. Chambers, 312 U.S. at 385-386;
Hartford Accident & Indemnity Co. v. Southern Pacific Co., 273 U.S.
207, 215-216 (1927). On balance, however, we believe that the
concerns raised by Richardson are sufficient to warrant
reconsideration of that decision. /12/

2. If the Limitation of Liability Act applies only to tort
liabilities that bear a "significant relationship to traditional
maritime activity," this case would present the question of the
application of that standard. /13/ That question in turn would
require consideration of this Court's decisions in Executive Jet, and
Foremost, supra.

In Executive Jet, this Court held that unless the "wrong" involved
in a plane crash bears "a significant relationship to traditional
maritime activity," claims arising from the crash "are not cognizable
in admiralty in the absence of legislation to the contrary." 409 U.S.
at 268; see id. at 274. In Foremost, a case involving a collision
between two pleasure boats, the Court established that this
"significant relationship" standard applies outside the aviation
context (at least where the tort does not occur on the high seas) but
also made clear that "there is no requirement that 'the maritime
activity be an exclusively commercial one.'" 457 U.S. at 674. The
Court held that "(i)n light of the need for uniform rules governing
navigation, the potential impact on maritime commerce when two vessels
collide on navigable waters, and the uncertainty and confusion that
would necessarily accompany a jurisdictional test tied to the
commercial use of a given boat, * * * a complaint alleging a collision
between two vessels on navigable waters properly states a claim within
the admiralty jurisdiction of the federal courts." Id. at 677.

Foremost did not describe the nature of the "significant
relationship to traditional maritime activity" that would suffice to
support jurisdiction in cases, like this one, that do not involve the
navigation of vessels. In determining whether such a relationship
exists, most courts of appeals have adopted some variant of the
four-factor test first recognized by the Fifth Circuit in Kelly v.
Smith, 485 F.2d 520, 525 (1973), cert. denied, 416 U.S. 969 (1974).
Under that test, a court considers (485 F.2d at 525)

the functions and roles of the parties; the types of
vehicles and instrumentalities involved; the causation and type
of injury; and traditional concepts of the role of admiralty
law. /14/

In this case, the panel majority expressly rejected that test,
saying that it was not "helpful in developing the kind of analysis
indicated by Executive Jet and Foremost." Pet. App. 8a n.2. Instead,
it concluded that in the absence of a direct effect on maritime
commerce, admiralty jurisdiction should extend only to those
activities that (1) have a potentially disruptive impact on commercial
shipping and (2) involve navigation. Ibid. There is thus a conflict
among the circuits on the standards being applied to determine the
existence of the "significant relationship" required to sustain
admiralty jurisdiction over tort claims. /15/

Though the "four factor test" seems to envisage that admiralty
jurisdiction will be available to a greater degree than under the
Seventh Circuit's approach, it is difficult to ascertain at this
juncture the extent to which these conflicting approaches will
actually lead to differing results. In keeping with this Court's
emphasis in Foremost on the "need for uniform rules governing
navigation," even those courts committed to the "four-factor test"
have placed great emphasis on allegations that an injury has arisen
from an error in navigation. When a complaint has included such
allegations, the courts have usually found jurisdiction even in cases
involving the operation of non-commercial vessels. /16/ Conversely,
the courts have been reluctant to find jurisdiction in cases, like
this one, in which an injury has not arisen from an alleged
navigational error. See Lewis Charters, Inc. v. Huckins Yacht Corp.,
871 F.2d 1046 (11th Cir. 1989); Lloyds of London v. Montauk Yacht
Club & Inn, 704 F. Supp. 1175 (E.D.N.Y. 1989). /17/

Thus, the practical significance of the differing standards being
employed in the courts of appeals remains unclear. Nevertheless, we
believe that the conflict calls for this Court's review. The conflict
has been perceived as significant. One court has criticized the
approach applied by the panel here as "an indefensibly narrow reading
of Foremost Insurance." In re Young, 872 F.2d 176, 178-179 n.4 (6th
Cir. 1989). Moreover, although joining in the court's judgment, the
concurring judge on the panel also expressed concern that its test
would "place inappropriate restrictions on admiralty jurisdiction in
other instances." Pet. App. 21a (Ripple, J., concurring). Because
Foremost provides modest guidance with respect to cases that do not
involve navigation or commercial shipping, it seems likely that
dispute and uncertainty over the content of the "significant
relationship" test will persist if the matter does not receive this
Court's attention. /18/ Such uncertainty over the proper scope of
admiralty jurisdiction and maritime law runs counter to the interest
of courts and litigants in the expeditious determination of
controversies on their merits. See Z. Chafee, Some Problems of Equity
310-316 (1950).

CONCLUSION

The petition for a writ of certiorari should be granted.

Respectfully submitted.

KENNETH W. STARR

Solicitor General

DAVID L. SHAPIRO

Deputy Solicitor General

STEPHEN L. NIGHTINGALE

Assistant to the Solicitor General

JANUARY 1990

/1/ All citations to the Limitation of Liability Act are to
Supplement IV to the 1982 edition of the United States Code.

/2/ Section 183(a) of the Act provides in pertinent part:

The liability of the owner of any vessel, whether American or
foreign, * * * for any act, matter, or thing, loss, damage, or
forfeiture, done, occasioned, or incurred, without the privity
or knowledge of such owner or owners, shall not, except in the
cases provided for in subsection (b) of this section, exceed the
amount or value of the interest of such owner in such vessel,
and her freight then pending.

/3/ The court acknowledged that its approach was not free from
doubt. It observed that there were "(s)trong arguments" for a broader
view of admiralty jurisdiction; it described as "puzzling" the fact
that Foremost had defined admiralty jurisdiction by reference to
"traditional maritime activity" while focusing on navigation; and it
conceded that its understanding of that jurisdiction might be "too
narrow and mechanical an interpretation of the Supreme Court." Pet.
App. 9a, 12a. The panel also noted that its definition of admiralty
jurisdiction differed from the "'four-factor' test" applied in several
other circuits. Id. at 8a n.2. However, the court of appeals felt
"constrained by" the language of this Court's decisions (id. at 10a;
see id. at 12a), and cited several reasons for declining to extend
admiralty jurisdiction to "include fires on pleasure craft as a matter
of course." Id. at 12a. These included the difficulty of establishing
any other limiting principle, "widespread scholarly criticism of the
exercise of admiralty jurisdiction over pleasure boat torts," and
concerns of federalism. Id. at 12a-14a.

In a concurring opinion, Judge Ripple maintained that the
majority's "test (would) place inappropriate restrictions on admiralty
jurisdiction in other instances." Pet. App. 21a. In his view,
Foremost did not restrict admiralty jurisdiction in non-commercial
cases to "matters directly involving the navigation of a vessel" or
preclude "jurisdiction based on other hazards traditionally associated
with maritime activities, including fire, when that hazard threatens
maritime commerce." Ibid. He concurred in the judgment, however, on
the ground that the fire in this case -- in a marina "dedicated
exclusively to the wharfage of pleasure boats" -- posed no such
threat. Ibid.

/4/ Because it held that the court lacked subject matter
jurisdiction over this action, the court of appeals did not address
the question whether the Limitation of Liability Act applies to
pleasure vessels. See Pet. App. 20a n.11. The court noted that the
lower federal courts have divided on that question.

/5/ In the admiralty setting, issues of jurisdiction and the reach
of substantive rules of law are linked. "With admiralty jurisdiction
comes the application of substantive admiralty law." East River S.S.
Corp. v. Transamerica Delaval Inc., 476 U.S. 858, 864 (1986).

/6/ In view of the Act's silence on matters of procedure in
proceedings under the Act, this Court took the extraordinary step of
announcing its intention to promulgate rules to regulate those
proceedings. Id. at 125. The Court subsequently issued
"Supplementary Rules in Admiralty" which, with some amendments, are
now codified as Supplemental Rule F, Fed. R. Civ. P. See G. Gilmore &
C. Black, supra, Section 10-14.

/7/ In 1936, Congress amended the Act by adding the provision now
codified at 46 U.S.C. App. 185. That amendment dealt with some of the
procedural matters that had previously been addressed only by the
Admiralty Rules. There is no indication in the language of the
Section or its history that it was intended to alter the
jurisdictional regime established by Richardson v. Harmon. See H.R.
Rep. No. 2517, 74th Cong., 2d Sess. (1936); S. Rep. No. 2061, 74th
Cong., 2d Sess. (1936).

/8/ There were two similar district court decisions prior to the
decision in this case. Clinton Board of Park Commissioners v.
Claussen, 410 F. Supp. 320 (S.D. Iowa 1976); Yacht Calibria, 1975
A.M.C. 981 (D. Md. 1975).

/9/ To be sure, Richardson involved the rule excluding from
maritime tort jurisdiction injuries occurring on "land," rather than
the "significant relationship" standard that the court of appeals
applied here. However, we believe that the reasoning of Richardson
does not support a distinction between these two criteria.

/10/ The original Act, codified at 46 U.S.C. App. 183(a), limited
the vessel owner's liability for "any act, matter, or thing, loss,
damage, or forfeiture, done, occasioned, or incurred, without the
privity or knowledge of such owner" to "the amount or value of the
interest of such owner in such vessel, and her freight then pending."
The 1884 amendment, codified at 46 U.S.C. App. 189, limited the
shipowner's liability "to the proportion of any or all debts and
liabilities that his individual share of the vessel bears to the
whole." The sparse legislative history of the provision, while
suggesting that the amendment was intended to provide protection from
contractual liability, 15 Cong. Rec. 3971 (1884) (remarks of Senator
Vest), does not indicate a substantial increase in the Act's scope.
See Butler v. Boston S.S. Co., 130 U.S. at 554 (suggesting that it was
"possible" that the amendment "was intended to remove all doubts of
the application of the limited liability law to all cases of loss and
injury caused without the privity or knowledge of the owner").

Even after Richardson, the courts have refused to apply the
Limitation of Liability Act to cases having no relationship to
navigable waters. E.g., In re Three Buoys Houseboat Vacations U.S.A.,
Ltd., 878 F.2d 1096 (8th Cir. 1989); Marroni v. Matey, 492 F. Supp.
340 (E.D. Pa. 1980); In re Howser's Petition, 227 F. Supp. 81
(W.D.N.C. 1964); In re Madsen's Petition, 187 F. Supp. 411 (N.D.N.Y.
1960); In re Stephens, 341 F. Supp. 1404 (N.D. Ga. 1965). These
decisions are difficult to square with Richardson. We believe that
they reflect a reluctance to sever completely any tie between the
Limitation of Liability Act and general admiralty jurisdiction.

/11/ See also Maryland Casualty Co. v. Cushing, 347 U.S. 409, 437
(1954) (Black, J., dissenting) ("Judicial expansion of the Limited
Liability Act at this date seems especially inappropriate. Many of
the conditions in the shipping industry which induced the 1851
Congress to pass the Act no longer prevail.").

/12/ As the court of appeals noted (Pet. App. 20a n.11), there is a
conflict on the question whether the Limitation of Liability Act
applies to pleasure yachts. The weight of authority supports such
application. In re Hechinger, 890 F.2d 202 (9th Cir. 1989); In re
Young, 872 F.2d 176 (6th Cir. 1989); Gibboney v. Wright, 517 F.2d
1054 (5th Cir. 1975); The Oneida, 282 F. 238 (2d Cir. 1922); Feige
v. Hurley, 89 F.2d 575 (6th Cir. 1937); Warnken v. Moody, 22 F.2d
960, 962 (5th Cir. 1927); In re Brown, 536 F. Supp. 750 (N.D. Ohio
1982); Armour v. Gradler, 448 F. Supp. 741, 748-750 (W.D. Pa. 1978);
In re Theisen, 349 F. Supp. 737 (E.D.N.Y. 1972); In re Klarman, 295
F. Supp. 1021 (D. Conn. 1968); In re Landi, 194 F. Supp. 353
(S.D.N.Y. 1960); In re Reading, 169 F. Supp. 165 (N.D.N.Y. 1958),
aff'd, 271 F.2d 959 (2d Cir. 1959); In re Colonial Trust Co., 124 F.
Supp. at 75; The Trim Too, 39 F. Supp. at 273. See 3 A. Jenner & J.
Loo, supra, Section 47, at 5-43 to 5-44 & n.5. Cf. Coryell v. Phipps,
317 U.S. 406 (1943); Just v. Chambers, supra (apparently assuming
that the Act applied to pleasure boats). However, a growing number of
district court decisions have held to the contrary. Estate of Lewis,
683 F. Supp. 217 (N.D. Cal. 1987); In re Shaw, 668 F. Supp. 524
(S.D.W. Va. 1987); In re Lowing, 635 F. Supp. 520 (D. Mich. 1986);
In re Tracey, 608 F. Supp. 263 (D. Mass. 1985); Baldassano v. Larsen,
580 F. Supp. 415 (D. Minn. 1984); Kulack v. The Pearl Jack, 79 F.
Supp. 802 (W.D. Mich. 1948). See also The Mamie, 5 F. 813 (E.D.
Mich.), aff'd on other grounds, 8 F. 367 (C.C.E.D. Mich. 1881).

In our view, the text of the Act strongly supports the conclusion
that it applies to pleasure boats. By its terms, Section 183(a)
extends the benefits of the Act to "the owner of any vessel" who can
satisfy its other conditions. Section 188 provides that the Act shall
apply to "all seagoing vessels, and also to all vessels used on lakes
or rivers or in inland navigation, including canal boats, barges and
lighters." For purposes of the United States Code, the term "vessel"
includes "every description of watercraft or other artificial
contrivance used, or capable of being used, as a means of
transportation on water." 1 U.S.C. 3. Finally, Section 183(f)
provides that for purposes of Sections 183(b)-(e) and 183b, the term
"seagoing vessel" does not include "pleasure yachts." The strong
implication of this language is that "pleasure yachts" are not
excluded per se from the category of vessels to which Section 183(a)
applies.

Thus, while there are compelling policy arguments against
application of the Limitation of Liability Act to pleasure yachts,
those arguments appear to be foreclosed by the language of the Act.

/13/ We assume that all claims as to which petitioner seeks the
benefits of the Limitation of Liability Act sound in tort. The
"significant relationship" test in Executive Jet and Foremost applies
only to such claims.

/14/ See, e.g., Drake v. Raymark Industries, Inc., 772 F.2d 1007,
1015-1016 (1st Cir. 1985); Eagle-Picher Indus., Inc. v. United
States, 846 F.2d 888, 896 (3d Cir. 1988); Oman v. Johns-Manville
Corp., 764 F.2d 224, 230 (4th Cir. 1985); Woessner v. Johns-Manville
Sales Corp., 757 F.2d 634, 639-649 (5th Cir. 1985); Guidry v. Durkin,
834 F.2d 1465, 1471 (9th Cir. 1987); In re Paradise Holdings, Inc.,
795 F.2d 756, 759 (9th Cir. 1986); Myhran v. Johns-Manville Corp.,
741 F.2d 1119, 1121 (9th Cir. 1984); Harville v. Johns-Manville
Products Corp., 731 F.2d 775, 783-787 (11th Cir. 1984).

The First and Fifth Circuits have refined the last of the four
factors. In its place, they now consider "(1) the impact of the event
on maritime shipping and commerce (2) the desirability of a uniform
national rule to apply to such matters and (3) the need for admiralty
'expertise' in the trial and decision of the case." Molett v. Penrod
Drilling Co., 826 F.2d 1419, 1426 (5th Cir. 1987); see Shea v.
Rev-Lyn Contracting Co., 868 F.2d 515, 518 (1st Cir. 1989).

/15/ American Eastern Devel. Corp. v. Everglades Marina, Inc., 608
F.2d 123 (5th Cir. 1979), on which petitioner relies heavily (Pet.
8-10), is not on point; that case arose in contract rather than in
tort.

/16/ Hogan v. Overman, 767 F.2d 1093, 1094 (4th Cir. 1985)
(admiralty jurisdiction extends to suit by waterskier against operator
of tow boat on ground that "negligent operation of a vessel is
alleged"); Oliver by Oliver v. Hardesty, 745 F.2d 317 (4th Cir. 1984)
(suit by swimmer against operator of boat); Medina v. Perez, 733 F.2d
170 (1st Cir. 1984) (admiralty jurisdiction extends to suit by
swimmers against small powerboat since suit involves navigation, "the
most fundamental" of maritime activities); Finneseth v. Carter, 712
F.2d 1041 (6th Cir. 1983) (collision between pleasure craft on lake
formed by a dam); See also Souther v. Thompson, 754 F.2d 151 (4th
Cir. 1985) ("allegation of a navigational error appears to be the key
to admiralty jurisdiction when dealing with small pleasure craft;"
jurisdiction found lacking because accident at issue did not "arise
out of an alleged navigational error"); St. Hilaire Moye v.
Henderson, 496 F.2d 973, 979 (8th Cir.) ("the operation of a boat on
navigable waters, no matter what its size or activity, is a
traditional maritime activity to which the admiralty jurisdiction of
the federal courts may extend"), cert. denied, 419 U.S. 884 (1974).

/17/ In Lewis Charters, the Eleventh Circuit applied the
four-factor test described above to a claim by the owner of a marina
against a boat owner whose negligence was allegedly responsible for a
fire. The court reached the same result as the court of appeals in
this case.

/18/ The petition also presents the question whether jurisdiction
could be founded upon the Extension of Admiralty Act, 46 U.S.C. 740.
However, that issue was not raised or decided in the court of appeals
or the district court.

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