In re: The Matter of TK Boat Rentals, L.L.C.
411 F.Supp.3d 351
E.D. La.2019Background
- On Feb. 12, 2017, a collision occurred on the Mississippi River between the M/V Super Strike (operated by captain Andre Boudreau for Extreme Fishing/charterer) and the M/V Miss Ida; Plaintiffs allege serious injuries.
- The M/V Kingfish (insured under AGCS for owner Wetzel) had a propeller loss the day before; Extreme Fishing substituted the M/V Super Strike (insured under GEICO by owner St. Clair) for the trip.
- Crossclaims: Boudreau and GEICO seek coverage from AGCS under AGCS’s “temporary substitute watercraft” clause; AGCS contends GEICO is primary and AGCS excess and brings a crossclaim against GEICO. AGCS also asserts it received an assignment of rights from Extreme Fishing.
- Disputes of fact exist about engine performance, whether the Kingfish’s propeller loss was a covered loss (and timely reported), and whether vessel defects or captain practices (e.g., not keeping horn accessible) caused the collision.
- Extreme Fishing (bareboat charterer) moved to limit liability under 46 U.S.C. § 30505, arguing no privity or knowledge of negligent acts; opponents point to facts arguably showing privity/knowledge and causation issues.
- Court holdings summarized: (1) Denied Boudreau/GEICO summary judgment on AGCS coverage (genuine disputes); (2) held AGCS and GEICO are co-primary insurers and must share pro rata; (3) AGCS has standing via assignment and may assert coverage under GEICO’s policy (partial assignment); (4) denied Extreme Fishing’s motion to limit liability (material disputes on causation/privity).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Boudreau (and M/V Super Strike) are covered under AGCS’s “temporary substitute watercraft” clause | Boudreau/GEICO: Kingfish was out of service from a covered loss (propeller) and Super Strike is similar type/value/length, so AGCS provides coverage | AGCS: Disputes as to whether the propeller loss was a covered loss (notice/inspection failures) and whether Super Strike is similar in type/value/length | Denied summary judgment for Boudreau/GEICO — genuine disputes on both covered-loss and similarity elements preclude relief |
| Whether GEICO or AGCS is primary/excess insurer (competing “other insurance” clauses) | GEICO: Its clause makes it excess; AGCS’s clause should be read narrowly and thus AGCS is excess | AGCS: “Property” in its clause encompasses substitute vessel; both policies’ excess clauses conflict | AGCS and GEICO’s excess clauses are mutually repugnant; court treats them co-primary and allocates pro rata shares |
| Whether AGCS has standing / can assert coverage under GEICO policy for Extreme Fishing | AGCS: Obtained (oral/partial) assignment from Extreme Fishing and thus stands in insured’s shoes to sue GEICO | GEICO: AGCS is not a named insured/additional insured/3d-party beneficiary and submitted insufficient evidence of assignment | AGCS has Article III standing; court finds/email + counsel declaration + policy subrogation clause support a valid oral, partial assignment allowing AGCS to assert coverage rights |
| Whether Extreme Fishing can limit liability under 46 U.S.C. § 30505 | Extreme Fishing: As bareboat charterer, no privity/knowledge of negligent acts; exercised reasonable care in hiring captain; limitation appropriate | Plaintiffs/others: Disputed facts on engine problems, failure to sound horn, and known captain practices, which could show causation and owner knowledge/privity | Denied summary judgment on limitation — factual disputes on causation and privity preclude limiting liability at this stage |
Key Cases Cited
- Celotex Corp. v. Catrett, 477 U.S. 317 (summary judgment burden and framework)
- Anderson v. Liberty Lobby, 477 U.S. 242 (standard for genuine issue of material fact)
- Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (evaluating whether reasonable jury could find for nonmovant)
- Steptore v. Masco Constr. Co., 643 So. 2d 1213 (La. 1994) (waiver of coverage defenses when insurer defends without reservation of rights)
- Cadwallader v. Allstate Ins. Co., 848 So. 2d 577 (La. 2003) (contract/policy interpretation rules)
- Graves v. Traders & Gen. Ins. Co., 214 So. 2d 116 (La. 1968) (mutual repugnancy of other-insurance clauses leads to prorata liability)
- Gaskin v. Jowers, 775 F.2d 621 (5th Cir. 1985) (analysis after incompatible excess clauses)