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TEXAS EASTERN TRANSMISSION CORP. v. DANN

September 6, 1995

TEXAS EASTERN TRANSMISSION CORPORATION, Plaintiff,
v.
TUG CAPTAIN DANN, her tackle, engines, boilers, etc. in rem, and DANN OCEAN TOWING, INC., Defendants.



The opinion of the court was delivered by: BERNARD NEWMAN

 BERNARD NEWMAN, Senior Judge of the United States Court of International Trade, sitting as a United States District judge by designation:

 INTRODUCTION

 This is an admiralty action within the meaning of Rule 9(h), Fed.R.Civ.P., and jurisdiction is predicated on 28 U.S.C. § 1333. The suit arises out of an allision occurring on November 24, 1990 between tank barge B No. 55 ("the barge") while in tow of tugboat CAPTAIN DANN and plaintiff's underwater natural gas pipeline 1R which crosses the Arthur Kill River ("Arthur Kill") between New Jersey and New York.

 Tug operator Dann Ocean Towing, Inc. ("Dann") denies any negligence and claims that the allision was due solely to plaintiff's negligent violation of the terms, conditions, and obligations of its permits issued by the United States Army Corp of Engineers ("ACOE") and statutory and regulatory violations. The alleged violations all revolve around plaintiff's negligence in failing to maintain adequate cover over its pipeline, which at the time and place of the allision was exposed above the riverbed creating an unlawful obstruction to navigation in Arthur Kill.

 The action was tried to the court commencing on April 26, 1995 and concluding on May 3, 1995. For the reasons that follow, the court dismisses the complaint. *fn1"

 THE FACTS

 Plaintiff, Texas Eastern Transmission Corporation ("Texas Eastern"), headquartered in Houston, Texas, operates an interstate natural gas pipeline system and owns the submerged sixteen inch natural gas pipeline 1R crossing the Arthur Kill between Linden, New Jersey and Gulfport, Staten Island, New York. Defendant Dann, of Tampa, Florida, engages in the business of owning and operating tugboats, and owns and operates CAPTAIN DANN. The barge is owned by Bouchard Transportation Co., Inc., unrelated to Dann and not a party to this suit.

 Pipeline 1R was installed by Texas Eastern under a permit (exh. 7) issued on June 9, 1950 by the ACOE pursuant to its statutory authority under the River and Harbor Act of 1899, § 10, 33 U.S.C. § 403. Such permit authorized plaintiff to install the pipeline in accordance with plans and drawings attached to the permit. A profile drawing attached to and incorporated in the permit depicts the pipeline buried beneath the surface of the river bottom from shore to shore and also indicates that the pipeline would be installed at a minimum depth of 42 feet below mean low tide in the main ship channel.

 In 1959, Texas Eastern surveyed the pipeline to determine how it was actually installed (as opposed to how it was proposed to be installed), and the survey findings were placed on a drawing (exh. 8) described as "Revised to as-built, May 15, 1959" and submitted to the ACOE. There is nothing in the record indicating that the ACOE made any objection to, or found anything improper, concerning the pipeline's actual installation as shown on the "as built" drawing.

 The width of Arthur Kill from bank to bank where Line 1R crosses the river is approximately 1000-1500 feet. The width of the "federal project channel" (main deep water ship channel that is dredged and maintained by the ACOE) at the site of the 1R pipeline crossing is approximately 500-600 feet as depicted on the official navigation chart of the National Oceanic and Atmosphere Administration ("NOAA chart"). The NOAA chart is used by mariners in navigating the Arthur Kill. The waters east of the main channel toward the Staten Island side, where the allision occurred, become quite shallow approaching the shoreline, but nonetheless are subject to vessel traffic on the river.

 While vessels travelling at normal operating speed enroute to a particular destination will generally navigate inside the project channel in both directions, as discussed infra, at the time of the allision CAPTAIN DANN, with the barge in tow, was maneuvering in the river outside and east of the project channel and near the Staten Island shore while waiting to berth at the Exxon Bayway facility on the New Jersey side some two-tenths of a mile away. The Arthur Kill east of the main channel is frequently used by mariners when turning in the river.

 Line 1R is located within a designated "Pipeline Area" as denoted on the NOAA chart. Texas Eastern maintains warning signs on shore stating "WARNING/DO NOT ANCHOR OR DREDGE" on both sides of the Arthur Kill at the crossing site. The R1 pipeline emerged from shallow water at a certain point near the New Jersey side of the river, and hence was visible to the eye at such point and is shown on the NOAA chart by an "obstruction" symbol. Significantly, however, the R1 pipeline did not similarly emerge from the water on the Staten Island side in the vicinity of the allision, but was submerged, and therefore, not visible to mariners. At night, which is when the allision occurred, the only illumination near the vicinity of the allision came from the Exxon refinery facility on the opposite (New Jersey) side of the river approximately one-quarter to one-half mile away.

 In 1974, Texas Eastern engaged engineers Pyburn & Odum ("P & O") to perform a river bottom survey on May 2, 1974. The 1974 survey revealed that through the erosion of cover, the pipeline had become exposed above the riverbed near the New Jersey and Staten Island shores; in point of fact, a section of the exposed pipeline in the vicinity of the CAPTAIN DANN incident on the Staten Island side was flattened, requiring complete replacement. Prior to making repairs, Texas Eastern applied for and obtained the required permits from the ACOE, New York State and City authorizing remedial work to replace the damaged section of pipeline and to cover it with stone "rip rap."

 In a letter dated October 25, 1974 by W.E. Graham, Manager of Rights of Way for Texas Eastern, to Phillip McGrade, Chief, Construction Permits Section of the ACOE, Graham describes the findings of the May 2, 1974 survey as follows (exh. D):

 
The subject pipeline has become exposed on both banks outside of the limits of the navigation channel and the pipe has been flattened at one point on the New York side of the channel. The exposed pipe [outside the navigation channel] constitutes a hazard to navigation as well as to the integrity of the pipeline. [Emphasis added.]

 Accompanying this letter was an ACOE form signed by Graham stating inter alia that the purpose of the proposed remedial work was to replace the cover over the exposed pipe outside the main channel to eliminate a hazard to navigation, and a Texas Eastern drawing showing the exposed section of pipe in the vicinity of where the CAPTAIN DANN incident would later occur.

 The ACOE issued a Letter of Permission dated August 29, 1975 to Texas Eastern authorizing remedial work "in or affecting navigable waters of the United States " including repair of the damaged section of pipeline and placement of rip rap over the exposed section "in accordance with the plans and drawing attached hereto which are incorporated in and made part of this authorization." Plft's exh. 9 and Def't's Exh. D (emphasis added).

 The Letter of Permission expressly recognized and stressed to the permittee that the section of pipeline near the Staten Island shore to be repaired and covered was in navigable waters and thus the permit required, inter alia: "That the permittee [Texas Eastern] shall maintain the structure or work authorized * * * in accordance with the plans and drawings attached hereto"; "that no attempt shall be made by the permittee to prevent the full and free use by the public of all navigable waters at or adjacent to the activity authorized by this authorization"; and "that there shall be no unreasonable interference with navigation by the existence or use of the activity authorized herein."

 In 1976 Texas Eastern completed the replacement of the damaged section of pipeline near the Staten Island shore and covered such section with two feet of stone "rip-rap," as authorized by ACOE and in compliance with the guidelines for cover set forth in the Natural Gas Pipeline Safety Act of 1968, 49 C.F.R. Part 192. The new installation of 80 feet of pipeline and rip rap cover left the pertinent section of pipeline installed at an elevation higher than initially proposed, and raised the pipeline in that area above the riverbed. The remedial work was reinspected by P & O on February 16, 1976, and the 1976 survey findings are noted on Texas Eastern's Plan and Profile Drawing dated May 30, 1974, which was updated February 16, 1976 (exh. A).

 In 1984, Texas Eastern retained P & O to perform a new bottom survey - shore to shore - of Line 1R, updating the previous surveys, which is plotted on their February 3, 1984 survey findings (exh. B). In the course of that new survey, a seventeen lineal foot section of pipeline on the river bottom in the vicinity of the Staten Island shore was again found exposed, in fact the very same vicinity near the Staten Island shore where the pipeline was covered by rip rap following the 1974 survey, and where the CAPTAIN DANN incident would later occur. Obviously, the rip rap cover placed over the exposed pipeline above the riverbed at this location in 1976 failed to remain in place, as had the original cover over the pipeline.

 Plaintiff could produce no eyewitness, documentary evidence, or any record in the files of Texas Eastern or from any other source establishing that the exposed section of pipeline was, in fact, again re-covered with rip rap following the 1984 survey findings. However, plaintiff's witness Roy Hartstein, Texas Eastern's Northeast Region Technical Operations Superintendent from 1989 to 1994, who was in charge of operations, inspections and overseeing pipeline maintenance, including Line 1R, explained that remedial work would have been performed at the time of the 1985 "uprating" project and such remedial work would have been permissible, without further ACOE authorization, under the 1976 ACOE Letter of Permission. Hartstein, had no knowledge of how much rip rap cover would have been used at that time.

 Absent affirmative contradictory evidence, the court accepts as credible Hartstein's belief that the exposed section of pipeline would have again been re-covered with rip rap in 1985 in accordance with the Letter of Permission issued in 1976. However, Hartstein's opinion, based on exhibit 18a (photograph of exposed pipeline taken shortly after the allision), that the pipeline in the vicinity of the CAPTAIN DANN incident was covered at the time of the allision in 1990 is rejected in light of more probative and credible evidence of the condition of the pipeline at the time of the allision, as discussed infra.

 No bottom or diving surveys were conducted on behalf of Texas Eastern following the 1985 survey prior the allision in 1990. Rather, to monitor whether there was a recurrence of the erosion and exposure of pipeline which would again have to be re-covered, Texas Eastern relied on vehicular patrols, where the inspector presumably got out of the vehicle and went to the river's edge to "take a look." Defendants contend, and the court agrees, such inspections were woefully inadequate to reveal further erosion of the rip rap cover and whether submerged pipeline was again exposed or inadequately covered. Significantly, the existence of exposed pipeline in the area of the CAPTAIN DANN incident was discovered only by bottom surveys, as in 1976 (when a section of pipeline had been "flattened"), and again in 1985.

 Further, notwithstanding the vehicular inspections, the photograph taken two days after the allision (exh. 18a) shows rip-rap in-shore of the contact point, but only "a couple of stones on the top" of Line 1R in the exact area found to be exposed in 1985. Tr. 877-878. Hence, a logical inference to be drawn from the evidence is that even granting that the section of pipeline where the rip-rap was found to have been eroded in 1985 was re-covered with rip-rap sometime after 1985, as Hartstein believed would have occurred, such cover again eroded to the point of exposure of the pipeline prior to the allision in 1990. Such erosion was never discovered by the vehicular inspections.

 In addition, the court gives little weight to Hartstein's testimony regarding his visit to the R1 crossing site in 1988, two years prior to the allision, since there is no evidence that at the time of day and state of the tide, he could have observed the condition of the cover over the submerged pipeline in the area of the allision, considering there were substantial tidal changes between mean low water and mean high water.

 CAPTAIN DANN is a steel hull tugboat measuring 114 feet in length and 33 feet in breadth. The tug has an upper and a lower operational pilothouse, the upper being 20 feet higher than the lower. Obviously, visible objects may be better viewed from the upper pilothouse in the event there is a restricted view from the lower pilothouse. At the time of the allision, CAPTAIN DANN ...


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