[00:00:00] Speaker 01:
May it please the court, my name is Natasha Taylor, and I represent Appellant Gemini Insurance Company.

[00:00:06] Speaker 01:
Gemini reserves three minutes for rebuttal.

[00:00:09] Speaker 01:
In this insurance coverage dispute, it is the plain language of the Lloyd's policy, the arbitration award, and the club rules that demonstrate that the district court erred when granting summary judgment in Lloyd's favor and denying Gemini relief.

[00:00:23] Speaker 01:
This court should reverse the decision for two independent reasons.

[00:00:28] Speaker 01:
First, the district court misinterpreted the arbitration award and misapplied its findings as to charter's risks to deny fury coverage under the Lloyd's policy.

[00:00:37] Speaker 01:
And second, contrary to New York law, the district court narrowly interpreted the Lloyd's policy and disregarded provisions in the club rules to reach its conclusions.

[00:00:49] Speaker 01:
Thus, Jim and I is asking this court to hold that there is coverage under the Lloyd's policy and to remand back for further proceedings as to priority of coverage.

[00:00:58] Speaker 02:
Well, the key phrase in the policy is

[00:01:05] Speaker 02:
their legal and or contractual liabilities to third parties under their, meaning the association's club rules for charterers' risks.

[00:01:15] Speaker 02:
So the question is, what is the club rules for charterers' risks referred to?

[00:01:21] Speaker 02:
And is it your view that refers to the rules as a whole, the entirety of them?

[00:01:26] Speaker 02:
Yes, Judge.

[00:01:27] Speaker 02:
Wouldn't that incorporate all of the provisions of the rules, even though many of them are contradictory to other provisions in the policy itself?

[00:01:36] Speaker 01:
What we have in this case is a little bit unusual, because Lloyd's is taking its own standalone policy from, I believe it's 1996, and incorporating club rules from a different organization from 2015.

[00:01:48] Speaker 01:
And it doesn't necessarily all line up.

[00:01:51] Speaker 01:
But what we're looking at it is from the perspective of what FURY, the Insured What Believe would be reasonable coverage.

[00:01:57] Speaker 01:
And what we can see is that when you are sent to the club rules, it's kind of like a book.

[00:02:02] Speaker 02:
But it isn't just the club rules.

[00:02:04] Speaker 02:
It's the club rules for charterers' risks, which would normally you would think, okay, well, where in the rules do they talk about charterers' risks?

[00:02:15] Speaker 02:
And that looks like

[00:02:17] Speaker 02:
part of rule four in the addendum.

[00:02:20] Speaker 02:
And so maybe it just incorporates the coverage that's described there and not the rest of it with all these conflicting provisions.

[00:02:28] Speaker 02:
Why isn't that a reasonable and correct reading of the policy?

[00:02:32] Speaker 01:
Because Lloyds is the drafter of the policy, if it wanted to do that, it could have very easily done so.

[00:02:37] Speaker 01:
Instead, it contained a very nebulous, undefined term, charters risks.

[00:02:42] Speaker 01:
And that's why the definition section, which Lloyds now says in the club rules is some sort of advisory definition, is really important in this case.

[00:02:50] Speaker 01:
Because what we see is when we look to the definitional section, owner includes the word charter, plain and simple.

[00:02:56] Speaker 01:
It doesn't say it's a demise or bare boat charter.

[00:02:59] Speaker 01:
which means something like an owner, but just not necessarily the owner of the boat, but it has all the responsibilities.

[00:03:05] Speaker 01:
And it doesn't just say time charter.

[00:03:06] Speaker 01:
It says charter.

[00:03:08] Speaker 01:
And so when you go to the rules and you start with rule one in the introductory section, you understand from the rules that rule two is the standard cover in this case.

[00:03:16] Speaker 01:
That means that's the cover that applies to everything.

[00:03:19] Speaker 03:
But rule four says special that this section rule four applies to charters.

[00:03:26] Speaker 03:
Why isn't that enough?

[00:03:27] Speaker 03:
Why isn't that clear enough?

[00:03:29] Speaker 01:
Because it only applies if a written agreement is provided by the managers.

[00:03:36] Speaker 01:
And that's important, because what Club Rule 2 does is it provides the broad coverage.

[00:03:40] Speaker 01:
And there's more than, of course, injury to a seaman.

[00:03:43] Speaker 01:
But injury to a seaman is one of the pieces that it covers.

[00:03:45] Speaker 01:
And that's legal liability for injuries to a seaman.

[00:03:48] Speaker 01:
Rule 4 is something a little bit more specific.

[00:03:50] Speaker 01:
What we see in Rule 4 is actually indemnity coverage.

[00:03:54] Speaker 01:
And that's why there has to be an agreement.

[00:03:56] Speaker 01:
Because what the association wants to do is if you want that type of agreement, if you want that type of coverage in which the charter is going to indemnify the owner or the despondent owner, you have to have the association agree with you.

[00:04:07] Speaker 02:
And that's not what's at issue.

[00:04:08] Speaker 02:
Because this is really what you might colloquially call rule two coverage and not rule four, one A coverage.

[00:04:16] Speaker 02:
Is that correct?

[00:04:17] Speaker 02:
It's not an contractual indemnity obligation.

[00:04:20] Speaker 02:
It's that two parties with tort liability are trying to figure out who

[00:04:24] Speaker 02:
you know, pays what portion of their own liability?

[00:04:28] Speaker 01:
Yes and no, Your Honor.

[00:04:29] Speaker 01:
Yes, in that rule two is for the legal liability part, but rule four, in this case, what CISPRI wanted from FURY was contribution.

[00:04:37] Speaker 01:
And although it wasn't contractual indemnity, its contribution for money it already paid.

[00:04:41] Speaker 01:
It could, it could.

[00:04:43] Speaker 02:
So who actually paid the money?

[00:04:45] Speaker 01:
CISPRI paid the money.

[00:04:46] Speaker 02:
And has anyone reimbursed CISPRI at this point?

[00:04:49] Speaker 02:
Any insurer?

[00:04:51] Speaker 02:
So CISPRI is the only one who paid, Jem and I paid a million.

[00:04:54] Speaker 02:
And then CISPRI paid how much?

[00:04:56] Speaker 01:
So CISPRI, what happened originally is when the injury occurred to Siemen EH, CISPRI went ahead and paid $11 million out of its own pocket.

[00:05:04] Speaker 01:
And then it brought FURY into the arbitration to dispute of the $11 million who was responsible for the $11 million, which is why the arbitrator decided 65% FURY and 35% CISPRI.

[00:05:16] Speaker 01:
And then in this case, Jim and I paid the $1 million plus interest as part of

[00:05:22] Speaker 01:
the 65% for fury, and is disputing- Paid that to CISPRI.

[00:05:26] Speaker 01:
Paid that to CISPRI, and now is disputing who goes next.

[00:05:30] Speaker 02:
And it's- So no one else has paid CISPRI at this point.

[00:05:34] Speaker 01:
We have settled.

[00:05:35] Speaker 01:
Part of it is we have settled in part with CISPRI, because CISPRI and the district court filed the DJ action against Jim and I in this case.

[00:05:44] Speaker 01:
And to resolve our dispute with CISPRI, Jim and I settled.

[00:05:48] Speaker 01:
That's part of the motion to dismiss, the motion to strike.

[00:05:52] Speaker 01:
Uh, motion practices before this court as well, but that, that doesn't really matter because what happened is we have a, um, declaratory judgment action in the district court.

[00:06:02] Speaker 01:
And so there is still a live dispute that Jim and I has with Lloyd's as to who is supposed to go next.

[00:06:09] Speaker 01:
And so what we see here is because the charters risks, and we look at charters just a couple different ways.

[00:06:14] Speaker 01:
Courts look to obviously the time charter party agreement, and there is one here between FURY and CISPRI.

[00:06:21] Speaker 01:
And in that time charter party agreement, it's important to note that

[00:06:25] Speaker 01:
Fury was responsible for providing all instructions and sailing directions.

[00:06:29] Speaker 01:
We see that on page 328 of the time charter party.

[00:06:32] Speaker 01:
And then we have the spot party agreement and the spot agreement basically is a specific agreement on page 325 of the record.

[00:06:40] Speaker 01:
And that shows the specific day when this charter was going to go out and accomplish the mission that Fury had hired the charter for.

[00:06:48] Speaker 01:
And the arbitrator clearly spells out in his award that Fury was hiring the charter to do a few different things, to deliver supplies and or fuel.

[00:06:57] Speaker 01:
And we know from the arbitrator's reward that this had happened before successfully.

[00:07:02] Speaker 01:
So the vessel had been put out there on December 29th, and it was this vessel, and it accomplished its mission using the mooring apparatus, and it did so in that case safely.

[00:07:12] Speaker 01:
But in this situation, when they're doing the water transfer, what happened is there was a break of the line, and that injured EH.

[00:07:21] Speaker 01:
But the arbitrator did not necessarily determine that Fury as a platform operator, wearing solely a platform operator hat or distinction,

[00:07:30] Speaker 01:
was responsible.

[00:07:31] Speaker 01:
All he was tasked with was determining responsibility and liability, and he determined that CISPRI was negligent and that the negligence proximately caused the injuries.

[00:07:40] Speaker 02:
Was this liability in its capacity as charterer?

[00:07:48] Speaker 01:
Yes.

[00:07:50] Speaker 02:
And why is that?

[00:07:52] Speaker 01:
When looking at how the arbitrator viewed it,

[00:07:55] Speaker 01:
It's important to see the kind of the timeline of events.

[00:07:58] Speaker 01:
And we see from case law, the Hodgin versus Foist oil case, and even in the Chan versus society expedition case from this court.

[00:08:05] Speaker 01:
that when a charter gets involved and has a mission for chartering the vessel, that a charter can be responsible and held independently negligent, separate and apart from the contractual provisions.

[00:08:17] Speaker 01:
And what we see here is it's important that when we have a job safety analysis occurred during this day, during the particular charter, we see that in the record.

[00:08:27] Speaker 01:
And in the record it states that the job safety analysis occurred between

[00:08:30] Speaker 01:
the platform operator and the captain.

[00:08:32] Speaker 01:
And it occurred to talk about the safety between the two individual entities related to both the cargo operation, which happened right before the mooring line snapped, and then the water transfer.

[00:08:44] Speaker 01:
So we can tell from the record that Fury is engaged in the chartering aspect of why it brought out the vessel.

[00:08:52] Speaker 01:
for this particular aspect.

[00:08:54] Speaker 01:
Additionally, I think what you can see from the arbitrator's determination is that the arbitrator saw it wasn't just the negligent design and it wasn't just the negligent installation.

[00:09:06] Speaker 01:
It was everything.

[00:09:07] Speaker 01:
It was the use of the mooring apparatus.

[00:09:10] Speaker 01:
And the use of the mooring apparatus is what makes this case different from other cases because Fury was responsible for the use of the mooring apparatus.

[00:09:18] Speaker 01:
It's supposed to know when it's to be used safely.

[00:09:20] Speaker 01:
When can it use the size vessel that it's supposed to use?

[00:09:24] Speaker 01:
When can it use it in the type of weather, in the type of current?

[00:09:27] Speaker 02:
Do any any vessels use that mooring mechanism other than chartered vessels?

[00:09:35] Speaker 01:
The record does not say Judge Collins, but what we do know is the record does specifically show there are instances in which it was used specifically with a chartered boat.

[00:09:45] Speaker 01:
The December 29th with this particular vote was one charter, and the other example is the one that happened here.

[00:09:52] Speaker 01:
Lloyd's makes the argument that this could be used with other vessels.

[00:09:55] Speaker 01:
That's hypothetical.

[00:09:56] Speaker 01:
That's not the evidence that's before this court.

[00:09:58] Speaker 01:
The evidence that's before this court, as we know, that it's solely used for chartered vessels, and it had been used before.

[00:10:05] Speaker 01:
And if this court is going to kind of pivot away from the charter's risk argument and go back to the rule argument, what I want to note is that

[00:10:14] Speaker 01:
We're looking at this from the perspective of FURY and what FURY understands to be what it's being insured for.

[00:10:22] Speaker 01:
And although we look to the writing and we see that there is no written agreement for rule four, it's the same thing for the addendum for charters.

[00:10:30] Speaker 01:
The addendum for charters, you don't just open it up and go to the addendum for charters because what we see at the top of the page for the addendum for charters on page 715 is it specifically says that the addendum for charters provides the addendum

[00:10:44] Speaker 01:
contains the full wording and clauses which may be incorporated where contractually agreed on behalf of a charter by means of short-form reference of such a clause in the certificate of entry or in the endorsement slip.

[00:10:57] Speaker 02:
But if the policy is just incorporating their club rules for charterers risk, for charterers risks, and you're trying to find out what charterers risks are,

[00:11:11] Speaker 02:
Why isn't that just a cross-reference to the description of charterers' risks and not necessarily to, well, you know, you have to specifically adopt this, you know, part of the policy?

[00:11:22] Speaker 02:
It's a cross-reference.

[00:11:23] Speaker 02:
And so it's a cross-reference to charterers' liability in respect of risks set out in Rule 2.

[00:11:28] Speaker 02:
That seems to fit charterers' risks.

[00:11:32] Speaker 01:
Because the cross-reference,

[00:11:36] Speaker 01:
What could happen in this situation is when you have the Lloyd's policy and you go to the club rules, you still have to read the provisions of the rules themselves and make sure that you're abiding by the rules themselves.

[00:11:46] Speaker 01:
You can't just skip over the written agreement part.

[00:11:49] Speaker 01:
That's what's important in this case.

[00:11:50] Speaker 01:
You have to go to those rules and see that there's a written agreement between the members, and there is not, undisputably, and see if the certificate of entry or the endorsement slip

[00:12:01] Speaker 01:
is attached to the record that shows us that we get this addendum.

[00:12:04] Speaker 03:
And we don't have that.

[00:12:05] Speaker 03:
I don't understand why you're referring to the addendum.

[00:12:09] Speaker 03:
The addendum, as I understand it, doesn't help your position because it clearly states that the insurance covers the liability of the above-named members in his capacity as charterer.

[00:12:20] Speaker 03:
So why does that help your position?

[00:12:24] Speaker 01:
It helps the position in that there needed to be a written requirement.

[00:12:28] Speaker 01:
And so to get to the addendum, there has to be a written requirement.

[00:12:31] Speaker 01:
And Lloyd's could have easily done that.

[00:12:33] Speaker 01:
They could have easily done that in its section of the insurance policy when it said club rules for charters risks, specifically comma, in rules four and in the addendum for charters, and there doesn't need to be a written agreement as stated in those particular documents.

[00:12:50] Speaker 01:
It is the drafter of the policy, and we construe that things against the drafter of the policy.

[00:12:55] Speaker 01:
Your honor, can I reserve the rest of my time for rebuttal?

[00:12:58] Speaker 02:
All right.

[00:12:58] Speaker 02:
Thank you, counsel.

[00:13:00] Speaker 02:
We'll hear now from Ms.

[00:13:02] Speaker 02:
Madison.

[00:13:11] Speaker 00:
Good morning, Your Honor.

[00:13:12] Speaker 00:
May it please the Court?

[00:13:14] Speaker 00:
My name is Katie Madison, and I represent the syndicates at Lloyds of London that subscribe to the Charter's legal liability policy.

[00:13:25] Speaker 00:
The primary question in this case, as we see it, is who is liable for a defective,

[00:13:38] Speaker 00:
device that was affixed to a natural gas extraction platform that was not a vessel under 1 USC 3 and the mortgage platform snapped

[00:13:55] Speaker 00:
At the platform itself, the wire snapped.

[00:14:00] Speaker 00:
It was defective.

[00:14:01] Speaker 00:
The mortgage device was installed.

[00:14:04] Speaker 02:
Can we get straight to the relevant insurance question, which is what this cross-reference is?

[00:14:10] Speaker 02:
What does it mean to say club rules for charterers' risks?

[00:14:14] Speaker 02:
Does that mean

[00:14:16] Speaker 02:
any liability of a charterer under the rules that's covered, or does it mean just what's in rule four?

[00:14:24] Speaker 02:
Because charterer is unadorned within the definition of owner, which is plugs into rule two.

[00:14:32] Speaker 02:
So why isn't club rules for charterers risks rule two, among other things?

[00:14:39] Speaker 00:
So the UK PNI Club rules a mutual assurance association in which many large vessels, container ships, cruise ships are enrolled.

[00:14:53] Speaker 00:
The rules themselves provide broad coverage to owners or bare boat charters.

[00:15:01] Speaker 00:
This is a time charter, and there is discrete coverage provided

[00:15:08] Speaker 00:
to a time charterer or a voyage charterer for its liabilities as charterers.

[00:15:16] Speaker 02:
The definition of owner in the rules says charterer.

[00:15:21] Speaker 02:
It does not say demise or bare boat charter.

[00:15:25] Speaker 02:
It says charterer.

[00:15:27] Speaker 00:
Yes, it does, Your Honor.

[00:15:29] Speaker 02:
And the... Why isn't that enough?

[00:15:33] Speaker 02:
to plug it into rule two, and therefore rule two, with that understanding of owner, is one of the club rules for charterers res.

[00:15:43] Speaker 00:
So the policy itself, the policy language, did attach a copy and was subject to the charter party that existed between FURY and CISPRI.

[00:15:57] Speaker 00:
Also, a time charter is a limited

[00:16:01] Speaker 00:
type of charter, it's more like an Uber.

[00:16:05] Speaker 00:
It's not like renting an automobile, which is a bare-boat charter.

[00:16:12] Speaker 00:
Bare-boat charter is a type of species of ownership, Prohok Vichay.

[00:16:20] Speaker 00:
It would

[00:16:23] Speaker 00:
The actual rule four, it clarifies that it only applies to time charters and voyage charters.

[00:16:35] Speaker 00:
Also, the charter party that is attached to the policy

[00:16:40] Speaker 00:
reflects that the owner, the vessel owner, Sisbury, retained control under the general maritime law.

[00:16:51] Speaker 00:
It's well settled that the owner of a boat that is time chartered is responsible for

[00:17:00] Speaker 00:
the operational control and the seaworthiness of the vessel.

[00:17:05] Speaker 02:
So it would really... I guess I'd like a pretty specific, clear answer.

[00:17:10] Speaker 02:
What does the reference to club rules for charterers' risks mean?

[00:17:15] Speaker 02:
What are the club rules for charterers' risks?

[00:17:18] Speaker 00:
They are constrained by the charterer's addendum and also incorporate rule four.

[00:17:28] Speaker 02:
Your position is that club rules for charterers just means rule four and the addendum and not rule two.

[00:17:35] Speaker 02:
The only way that... Can I get a yes or no to that question?

[00:17:40] Speaker 00:
maybe and if I could give you a qualification your honor the only way that rule 2 would ever apply is if the charter took some action and

[00:17:56] Speaker 00:
beyond its obligations under the charter.

[00:18:00] Speaker 00:
For example, in the line of cases that the appellant cited, the Graham v. Milky Way, the Hodgkin case, in that line of cases, the time charter took action in which

[00:18:17] Speaker 00:
The charter was actually controlling the operation of the boat.

[00:18:21] Speaker 03:
Are those those fifth circuit cases?

[00:18:23] Speaker 00:
Yes, they are.

[00:18:25] Speaker 00:
I think there's a second circuit case.

[00:18:27] Speaker 00:
And there is a ninth circuit case, the Chan v. Society Expeditions, in which the time charter took control of the boat.

[00:18:38] Speaker 00:
In those narrow circumstances, a time charter could be liable for

[00:18:46] Speaker 00:
the death or personal injury of a Jones Act seaman.

[00:18:51] Speaker 00:
We don't have, those cases are factually distinguishable, Your Honor.

[00:18:56] Speaker 00:
We don't have that scenario here because the charter is very specific and the arbitrator... I want to understand, in that situation where the charter takes over the operation of the boat, you say that they would

[00:19:14] Speaker 02:
that the phrase, in that circumstance, the phrase club rules for charterers risk would include rule two as to a charter who took over the whole boat?

[00:19:23] Speaker 00:
Who took over control and exercised operational control.

[00:19:27] Speaker 02:
How do you get that out of the phrase charterers risk?

[00:19:32] Speaker 02:
I mean, you could have had a really clear reference in this policy.

[00:19:36] Speaker 02:
We incorporate this rule, that rule, this sub-provision.

[00:19:39] Speaker 02:
Instead, you use the general phrase, club rules for charter is risk, and then the rules are long and complex, and it's very unclear what's being incorporated by cross-reference.

[00:19:51] Speaker 00:
Those rules would only apply, and primarily rule four applies, if there is some negligence of the charterer in its capacity as a time charterer that causes damage to the vessel, damage to the crew,

[00:20:13] Speaker 02:
Correct, but then I don't understand, I understand that argument, but then I don't understand why you said that the charter who takes over the boat could have rule two coverage, and that would be club rules for charter's risk.

[00:20:27] Speaker 02:
I didn't get that.

[00:20:28] Speaker 02:
I just don't see how that comes out of the language.

[00:20:31] Speaker 02:
That would be... It seems contrary to the concession.

[00:20:34] Speaker 02:
It seems contrary to your own argument.

[00:20:37] Speaker 00:
I can only, and Your Honor, that is not what the arbitrator found, and that is not what the district court found, that the charter exceeded his duties and responsibilities as charterer.

[00:20:54] Speaker 00:
You asked me if there were ever a scenario in which that could occur, perhaps rule two

[00:21:01] Speaker 00:
could apply if the charterer did something which is not the fact pattern here.

[00:21:07] Speaker 02:
I understand that, but why would that then be considered club rules for charterers' risks?

[00:21:14] Speaker 02:
Linguistically, how would that scenario fit within that phrase?

[00:21:17] Speaker 02:
Explain that to me.

[00:21:20] Speaker 00:
I think there would then be a big dispute if the charter exceeded its responsibility and its duties as the charter because the policy was subject to the charter party itself.

[00:21:36] Speaker 00:
There likely would be a coverage dispute about whether that was in fact covered But if because then they're not acting as a charter, that's right, so that's actually the answer correct.

[00:21:51] Speaker 04:
Yes, okay But if that's the case in why is it a club rule for charters risks if you go back to I think that's cause like I

[00:22:00] Speaker 04:
Maybe there's some other way that rule two comes into play, but how does that come into play as a club rule for Charter's risk, rule two, under your scenario where they just take over the boat?

[00:22:12] Speaker 00:
it would come into play if you had a situation in which perhaps the charter brought cargo on board and it caused damage to the vessel or damage to a crew member.

[00:22:27] Speaker 00:
There is a case that is relied upon by appellants and I

[00:22:34] Speaker 00:
It's a 1929 case in which a charterer brought on board and stowed explosives under a leaking engine.

[00:22:46] Speaker 00:
That perhaps, stowing cargo on board a boat negligently.

[00:22:52] Speaker 04:
So this argument, but just to be clear, your argument seems pretty clean to say club rules.

[00:22:58] Speaker 04:
I mean, it's not super clear, but it seems cleaner to say club rules for charter's risks

[00:23:03] Speaker 04:
the Charter's Addendum and Rule 4.

[00:23:07] Speaker 04:
But then I think Judge Collins' question was, yeah, but now you seem to be conceding that no, but it also reaches out and grabs Rule 2 and certain, like the phrase, club rules for Charter's risk reaches out and grabs Rule 2 for some purposes, that starts to feel really complicated.

[00:23:25] Speaker 04:
So all that's built into that one phrase, that it reaches out in some purposes, but not the purposes applicable to this case.

[00:23:32] Speaker 00:
And I'm not looking at rule four, your honor, right now.

[00:23:38] Speaker 00:
However, if the charter is liable for causes negligence, and I think rule two is the only rule that specifically relates to personal injury or death of Jones Act Seaman.

[00:23:56] Speaker 04:
So maybe that's your argument then that

[00:23:58] Speaker 04:
Rule four does refer back to rule two in certain circumstances.

[00:24:02] Speaker 04:
So that's how you get there is club rules for charge risk is the addendum and rule four, but rule four in certain circumstances goes to rule two, but not in circumstances in this case.

[00:24:16] Speaker 00:
That would be in the event that that would be a type of injury to a Jones Act semen or death

[00:24:29] Speaker 00:
would be a charter's liability that is insured against.

[00:24:36] Speaker 00:
But again, the

[00:24:39] Speaker 00:
This policy only incorporates charterers liability.

[00:24:44] Speaker 00:
An owner would, of course, and most of the club rules are geared toward owners of boats necessarily have liability for any crew members that they employ that are on the boat for negligence.

[00:25:02] Speaker 02:
Looking at the addendum, if we do agree with you that we should be looking at the

[00:25:08] Speaker 02:
the language of the addendum.

[00:25:10] Speaker 02:
What it says is this insurance covers the liability of the above-name member in his capacity as charterer in respect of risks set out in Rule 2.

[00:25:20] Speaker 02:
And then there's a further clause about indemnity.

[00:25:24] Speaker 02:
Why isn't this a liability of the member in his capacity as charterer in respect of risks set out in Rule 2?

[00:25:35] Speaker 00:
Your honor, it's not because here this was a platform liability.

[00:25:41] Speaker 00:
This was platform equipment.

[00:25:43] Speaker 00:
This had absolutely nothing to do with the vessel.

[00:25:47] Speaker 00:
It was.

[00:25:48] Speaker 02:
That's obviously untrue because it's about connecting the vessel to the platform and the mechanism for doing it.

[00:25:56] Speaker 02:
So it's the interface of the two things.

[00:25:59] Speaker 02:
So it's both as platform operator and as a charter that I'm bringing this boat to my platform and I'm going to connect it to my platform.

[00:26:06] Speaker 02:
So I'm kind of wearing two hats at that point, aren't I?

[00:26:09] Speaker 00:
No, Your Honor, because actually the wire rope snapped at the platform itself.

[00:26:19] Speaker 00:
It did not snap at the vessel.

[00:26:22] Speaker 00:
Also, the arbitrator and the district court found

[00:26:26] Speaker 00:
that the operation was otherwise unremarkable, and but for the snapping, the mortgage there, the connection, that but for the wire rope snapping at the platform,

[00:26:43] Speaker 00:
and but for the negligence of fury in deviating from the design, the safe design of the platform that this event never would have happened.

[00:26:56] Speaker 02:
It also would have happened if they hadn't tried to attach the boat to it using this mechanism.

[00:27:03] Speaker 02:
I mean, the charter has a responsibility not to kill and injure the people that it brings out to the platform and that

[00:27:13] Speaker 02:
in the process of trying to attach it to the platform, they don't kill and injure them.

[00:27:18] Speaker 02:
Why isn't that in this capacity as charter?

[00:27:23] Speaker 00:
So the arbitrator found that the operation and control at the time of the hookup was unremarkable.

[00:27:34] Speaker 00:
The sea conditions were unremarkable.

[00:27:37] Speaker 00:
That the vessel was under the control of the crew and the captain.

[00:27:42] Speaker 00:
that the captain was negligent because he failed to make sure that crew members would be outside of a safe place to stand.

[00:27:54] Speaker 00:
And when the wire rope snapped at the platform and snapped down, unfortunately, EH was injured from the wire rope coming off the platform.

[00:28:09] Speaker 00:
There's no factual issue

[00:28:12] Speaker 00:
that the mooring device broke at the vessel, or that Fury was directing the course of the vessel and the operation at that time.

[00:28:29] Speaker 02:
All right.

[00:28:29] Speaker 02:
Thank you, counsel.

[00:28:30] Speaker 00:
Thank you.

[00:28:31] Speaker 02:
We'll hear rebuttal now.

[00:28:42] Speaker 01:
May it please the court?

[00:28:45] Speaker 01:
Judge Collins, you hit it on the head.

[00:28:46] Speaker 01:
It is the interface between the platform owner and the charter in this case that has Fury wearing two hats.

[00:28:54] Speaker 01:
And we see that from the record.

[00:28:55] Speaker 01:
The arbitrator was clear that this was a joint mission.

[00:28:59] Speaker 01:
And the case law does not state, contrary to what opposing counsel just said, that it is the control of the boat alone that shows that somebody is acting as a charter.

[00:29:09] Speaker 01:
It's way more than that.

[00:29:12] Speaker 01:
The Milky Way case, this court's decision in Chan versus society expedition, as well as the Alexander versus United States case from this court.

[00:29:20] Speaker 01:
What we see here is we see certain situations in which time charters have additional duties to be diligent, to be safe, reasonable expectations in doing a mission.

[00:29:33] Speaker 01:
And so specifically, selecting a time for the vessel to conduct its mission, ensuring that the mission assigned to the vessel can be accomplished safely, and importantly, exercising reasonable care in the activities in which a charter participates or exercises control.

[00:29:50] Speaker 01:
So, Fury, in this case, did not need to be in control of the vessel.

[00:29:53] Speaker 02:
Was it known in advance that they would have to hook it up?

[00:29:56] Speaker 02:
Because am I correct that they only had to do that for one phase of the offloading?

[00:30:02] Speaker 01:
So the record shows that the only mandatory time when the mooring apparatus is used is when there's a transfer of fuel because they're worried about fuel spillage.

[00:30:11] Speaker 01:
But in this case, we know that the captain and the platform operator discussed during the joint meeting, the job safety analysis, that there would be a water transfer to do when using the mooring apparatus, using the water transfer.

[00:30:24] Speaker 02:
So they only used it for the water transfer and that was planned in advance.

[00:30:27] Speaker 01:
I don't think that was planned in advance, Your Honor.

[00:30:30] Speaker 01:
I don't think that's what the record reflects.

[00:30:32] Speaker 01:
But the record reflects that after the meeting, both the platform operator, Fury, and the vessel owner, Sispery, knew that that's the way that they were going to use the water transfer.

[00:30:41] Speaker 01:
They were going to do it via mooring apparatus.

[00:30:43] Speaker 03:
But let me see if I understand.

[00:30:44] Speaker 03:
Those cases that you cite where the charter sort of exerts control

[00:30:48] Speaker 03:
more over the situation, more over the ship.

[00:30:53] Speaker 03:
All of those cases have to do with, again, bringing on explosives under a ship or sailing into a storm.

[00:31:04] Speaker 03:
But this situation was different, wasn't it?

[00:31:07] Speaker 03:
I mean, how's what happened here similar to those other cases?

[00:31:12] Speaker 01:
In this case, it's similar.

[00:31:17] Speaker 01:
It falls a little bit in the cracks of those cases.

[00:31:19] Speaker 01:
A lot of those cases do talk about transferring passengers, the ingress and the egress, and generally a vessel owner is responsible for that.

[00:31:26] Speaker 01:
But those cases discuss the concept that when a charterer calls out a vessel in a time that is not safe to do its particular mission,

[00:31:35] Speaker 01:
then it can be held responsible.

[00:31:37] Speaker 01:
And here we have where the arbitrator determined that the mooring apparatus was to be used, in this case, and the mooring apparatus was not safe.

[00:31:45] Speaker 01:
And it was not safe specifically, not just for the design.

[00:31:49] Speaker 01:
Council stressed that it was just the design that the arbitrator found was to be the negligence.

[00:31:54] Speaker 01:
But FURY was negligent on page 316 of the record.

[00:31:58] Speaker 01:
And not knowing for what vessels, tonnage and size, in what circumstances, state of the tide, current, wind force direction.

[00:32:06] Speaker 01:
And he does note in his arbitration award that there was a strong current coming out of the north.

[00:32:11] Speaker 01:
It was safe to remit using the mooring apparatus.

[00:32:14] Speaker 01:
And why that's important is because the vessel owner in this case turned off the engine and it was guided by the tide and the current to create this tension.

[00:32:23] Speaker 01:
And the fact that FURY's employees did not know how to use the mooring apparatus for the sole purpose of doing the thing that it chartered the vessel for, which was to attach to the boat and transfer the supplies, again, the mission that FURY had, that is what makes this very similar to the cases in Hodgen and the Fifth Circuit, as well as this court's cases.

[00:32:45] Speaker 02:
All right.

[00:32:45] Speaker 02:
Thank you, counsel.

[00:32:46] Speaker 02:
Thank you, Your Honor.

[00:32:47] Speaker 02:
both counsel in this case for their helpful arguments and the case just argued will be submitted.