Judge Jon Newman
American Petroleum and Transport Inc. (APT) alleged $28,828 in economic losses—but did not suffer property damage—after its tug and barge were delayed for 2½ days by a malfunction preventing the opening of a New York City-operated drawbridge. Relying on the Supreme Court’s 1927 ruling in Robins Dry Dock & Repair v. Flint, district court dismissed APT’s complaint asserting violation of 33 USC §494—which requires that a drawbridge over navigable water be opened promptly by its owner or operator upon a reasonable signal for passage of boats and watercraft. On appeal from district court’s Oct. 11, 2012, ruling, Second Circuit concluded that although Robins Dry Dock had been overread to establish a rule barring damages for economic losses in the absence of an owner’s property damages, the rule has been so consistently applied in admiralty that it should continue to be applied unless and until altered by Congress or the Supreme Court. The rule has been accepted by a clear consensus of courts, has the “virtue of certainty,” and the context in which it applies—financial losses incurred in the course of commercial shipping—is marked by the availability, and frequent purchase, of first-party insurance to cover such losses.
