UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK
July 12, 1985
UNITED STATES OF AMERICA, Plaintiff against WATER QUALITY INSURANCE SYNDICATE, Defendant and Third-Party Plaintiff, -against- M/V COVE LEADER, her engines, boilers, tackle, etc., and COVE SHIPPING, INC., Third-Party Defendants
The opinion of the court was delivered by: GOETTEL
The Government commenced this action on October 25, 1980, to recover expenses it incurred cleaning up an oil spill. By motion, the defendant and third-party plaintiff and the third-party defendant seek to dismiss this action as time barred. For the reasons set forth below, the Court denies this motion.
On February 25, 1980, approximately 630 gallons of No. 6 oil spilled from the Coastal 2505 into the Intracoastal Waterway at Tucker Bayou, Deer Park, Texas. The spill resulted from the rupture of the hose through which the Coastal 2505 was discharging the oil. The United States and private contractors, whom the Government hired, cleaned up the spill.
The cleanup was completed on or around March 4, 1980, at a cost to the United States of approximately $30,133.54.
Almost four and a half years later, on October 25, 1984, the United States commenced this action pursuant to section 311 of the Federal Water Pollution Control Act ("FWPCA"), 33 U.S.C. § 1321, to recover the cleanup costs from Coastal Towing, Inc., the owner and operator of Coastal 2505, and Water Quality Insurance Syndicate ("WQIS"), the insurer of Coastal 2505.
The Government voluntarily dismissed the action against Coastal Towing on November 13, 1984. Defendant WQIS filed an answer asserting several affirmative defenses. It also filed a third-party complaint against the M/V Cove Leader and her owner, Cove Shipping, Inc. ("Cove"), in which WQIS alleged that the rupture of the hose and oil spill resulted solely from the excessive speed and wake wash of the passing Cove Leader.
WQIS now moves for an order granting summary judgment and dismissing the action on the grounds that it is barred by the three-year statute of limitations for tort actions contained in 28 U.S.C. § 2415(b). Cove joins in this motion.
The United States contends that no statute of limitations applies to actions brought on behalf of the United States to enforce the statutory FWPCA remedy created by 33 U.S.C. § 1321(f)(1). Alternatively, the United States contends that if a statute of limitations applies, it is the six-year provision for contract actions contained in 28 U.S.C. § 2415(a).
A. Sovereign Immunity
The doctrine of sovereign immunity provides that the United States as a plaintiff is not bound by any statute of limitations unless Congress provides otherwise. Guaranty Trust Co. v. United States, 304 U.S. 126, 132, 82 L. Ed. 1224, 58 S. Ct. 785 (1981); Federal Maritime Commission v. Caragher, 364 F.2d 709, 718 (2d Cir. 1966). The FWPCA contains no statute of limitations applicable to a cleanup cost recovery action brought by the United States under 33 U.S.C. § 1321(f)(1). The Government thus argues that no statute of limitations applies to this action. In enacting the FWPCA, Congress intended to shift the cost of oil spills away from the public and toward those who engage in enterprises that use the navigable waters and give rise to oil pollution. See United States v. Coastal States Crude Gathering Co., 643 F.2d 1125, 1128 (5th Cir. 1981). The courts should not restrict this cost-shifting intent and the remedial nature of the FWPCA, argues the Government, by applying 28 U.S.C. § 2415 to the instant action.
The Government has not cited a case that held 28 U.S.C. § 2415 inapplicable to FWPCA actions, nor have we found any. The courts that have considered the issue of the appropriate limitations period have either rejected or not considered the Government's argument that it is not subject to any limitations. We also reject the Government's argument.
The legislative history of 28 U.S.C. § 2415 indicates that the purpose of the statute was to establish statutes of limitations on certain broad types of governmental claims. See Statute of Limitation Act: Hearings on H.R. 13652 [sic] Before the Subcomm. of the House Comm. in the Judiciary, 89th Cong., 2d Sess., ser. 15 at 6-7 (1966) (statement of John M. Douglas, Assistant Attorney General). "[I]t is only right that the law should provide a period of time within which the Government must bring suits on claims just as it now does to claims of private individuals." S. Rep. No. 1328, 89th Cong., 2d Sess. 1, reprinted in 1966 U.S. Code Cong. & Ad. News 2502, 2503. As stated in the report by the Committee on the Judiciary of the House of Representatives:
Statutes of Limitation have the salutary effect of requiring litigants to institute suits within a reasonable time of the incident or situation upon which the action is based. In this way the issues presented at the trial can be decided at a time when the necessary witnesses, documents, and other evidence are still available. At the same time, the witnesses are better able to testify concerning the facts involved for their memories have not been dimmed by the passage of time. The committee feels that the prompt resolution of the matters covered by the bill is necessary to an orderly and fair administration of justice. Stale claims can neither be effectively presented nor adjudicated in a manner which is fair to the parties involved.
1966 U.S. Code Cong. & Ad. News 2502, 2503.
Thus, section 2415 was enacted "to establish statutes of limitations which will apply to contract and tort actions brought by the United States." S. Rep. No. 1328, 89th Cong., 2d Sess. 1, reprinted in 1966 U.S. Code Cong. & Ad. News 2502.
The Government contends that the FWPCA cleanup costs recovery action is founded upon a unique statutory remedy, and not upon a tort or contract. It contends, therefore, that section 2415 does not apply. However, as discussed below, this action is based upon a contract implied in law. The contention that the FWPCA was intended to create a new and unique system of liability does not diminish the nature of the cleanup cost recovery action. United States v. Pì Stco 213, 756 F.2d 364, 376 (5th Cir. 1985).
The Government also argues that 33 U.S.C. § 1321(f) provides that a discharger shall be liable to the United States Government "notwithstanding any other provision of law." 33 U.S.C. § 1321(f)(1). By this language, argues the Government, it is evident that recovery is to be unencumbered by other statutes as much as possible, including limitation periods.
The meaning of this language is unclear. Tug Ocean Prince, Inc. v. United States, 584 F.2d 1151, 1162 (2d Cir. 1978).
While various meanings can be drawn from this phrase . . ., we think it means that the remedies established by the FWPCA are not to be modified by any preexisting law. The main objective apparently was to assure that the limits on recoveries established by § 1321(f) are not to be varied by the different limits established by the Limitation Act.
In the Matter of Oswego Barge Corp., 664 F.2d 327, 340 (2d Cir. 1981) (citations omitted). Thus, this language was intended to apply to conflicts between the FWPCA and the Limitation of Shipowner's Liability Act, 46 U.S.C. §§ 181-195, and not time limitations.
In summary, the limitations of section 2415 are applicable to the instant controversy.
B. The Applicable Statute of Limitations
Section 2415 provides in pertinent part:
(a) Subject to the provisions of section 2416 of this title, and except as otherwise provided by Congress, every action for money damages brought by the United States or an officer or agency thereof which is founded upon any contract express or implied in law or fact, shall be barred unless the complaint is filed within six years after the right of action accrues . . . .
(b) Subject to the provisions of section 2416 of this title, and except as otherwise provided by Congress, every action for money damages brought by the United States or an officer or agency thereof which is founded upon a tort shall be barred unless the complaint is filed within three years after the right of action first accrues . . . .
28 U.S.C. § 2415 (1982). WQIS and Cove argue that the government's action for oil spill damages is founded upon a tort. Therefore, they contend, the three-year statute of limitations applies and thus the action is time barred by 28 U.S.C. § 2415(b). The Government argues that the six-year statute of limitations applies because the recovery sought is for restitution of its expenditures and thus the action is founded upon a contract implied in law. We agree that "this is essentially an action for restitution, to recover money expended to discharge the duty of clean-up imposed by law on the alleged polluter in the first instance, which the polluter did not perform although obligated to do so." United States v. Shawnee, Inc., 608 F. Supp. 649, 650 (S.D.N.Y. 1985).
The primary duty to clean up the oil spill lies with the polluter. United States v. Pì Stco 213, supra, 756 F.2d at 368-70; United States v. Barge Shamrock, 635 F.2d 1108, 1110 (4th Cir. 1980); United States v. Poughkeepsie Housing Authority, No. 80-1998, slip op. at n.10 (S.D.N.Y. Oct. 16, 1981). If the discharger does not initiate cleanup operations, the Government is authorized to do so. United States v. Pì Stco 213, supra, 756 F.2d at 370; United States v. Poughkeepsie Housing Authority, supra, slip op. at n.10. In the instant action, the government cleaned up the oil spill because Coastal Towing refused or was unable to properly remove the oil. Allegedly, despite numerous demands, Coastal Towing and WQIS have not paid the costs.
When one party receives some benefit either in goods or services, but does not compensate the party who has conferred the benefit, courts have allowed the uncompensated party to assert a quantum meruit or quasi-contractual claim for the value of the benefits conferred . . . . Such a quasi-contractual obligation is created in order to do justice to the parties, "without any expression of assent and sometimes even against a clear expression of dissent."
In the instant action, although the oil spill could be considered a tort . . . ., the Government is not seeking compensatory damages suffered as a result thereof, but rather restitution for the money it expended on behalf of the defendants to remove the discharge. Defendants have received the benefits of prompt governmental action on their behalf and should therefore make restitution to the government for its efforts. Accordingly, the Government's suit to recover the value of the benefits conferred must be characterized as quasi-contractual.
United States v. Poughkeepsie Housing Authority, supra, slip op. at 8-9 (citations and footnotes omitted). Therefore, the six-year statute of limitations of section 2415(a) applies.
See United States v. Pì Stco 213, supra, 756 F.2d 364; United States v. Shawnee, Inc., supra, 608 F. Supp. 649 (sharing the view of United States v. Pì Stco 213) ; United States v. C & R Trucking Co., 537 F. Supp. 1080 (N.D. West Va. 1982) (adopting the rationale of United States v. Poughkeepsie Housing Authority); United States v. Poughkeepsie Housing Authority, supra, No. 80-1998.
The six-year limitation in 28 U.S.C. 2415(a) applies to this action. Therefore, the motion for summary judgment and dismissal is denied.