UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
No. 94-2193
JUNO SRL, ET AL.,
Plaintiffs - Appellants,
v.
S/V ENDEAVOUR, ET AL.,
Defendants - Appellees.
No. 95-1426
JUNO SRL, ET AL.,
Plaintiffs - Appellees,
v.
S/V ENDEAVOUR, ET AL.,
Defendants - Appellants.
APPEALS FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MAINE
[Hon. Gene Carter, U.S. District Judge]
Before
Torruella, Chief Judge,
Bownes, Senior Circuit Judge,
and Stahl, Circuit Judge.
Michael X. Savasuk, with whom Bradley & Savasuk was on brief
for appellants JUNO SRL, et al.
Bradford D. Conover, with whom Dickerson & Reilly was on
brief for appellees S/V ENDEAVOUR, et al.
June 9, 1995
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TORRUELLA, Chief Judge. This case presents issues of
TORRUELLA, Chief Judge.
first impression before this Court. The first issue is what
weight private rules and procedures should have in determining
the liability of sailing vessels that collide while engaged in
the sport of yacht racing. The second issue is what forum shall
assess the damages that result from such circumstances.
The district court decision is reported. Juno v. S/Y
Endeavour, 865 F. Supp. 13 (D. Me. 1994). That court ruled that
the S/V CHARLES JOURDAN was liable to the S/V ENDEAVOUR after a
collision between the two vessels, but found that the ENDEAVOUR
was 40% at fault in causing the encounter. It also concluded
that the CHARLES JOURDAN suffered $10,000 in damages, from which
sum the court deducted its 60% finding of fault, and dismissed
all other claims for compensation by both the CHARLES JOURDAN and
the ENDEAVOUR. For the following reasons, we reverse on the
issue of liability and affirm in all other respects.
BACKGROUND
BACKGROUND
On October 3, 1992, the CHARLES JOURDAN, a seventy-two
foot sloop, was racing in the La Nioulargue Regatta, which
included a series of sailing races in and around the Bay of Saint
Tropez, off southern France. The Sailing Instructions of the
Regatta provided that it would be conductedpursuant to the 1989 -
1992 edition of the International Yacht Racing Rules (IYRR).
Also competing in this Regatta on a different course was the
ENDEAVOUR, a restored "J" class sloop 120 feet in length overall.
Both race courses, however, converged at a mark designated as
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"A," located at the entrance to Saint Tropez Bay. CHARLES
JOURDAN's course called upon it to round Mark A to port on its
way to the finish line at Bouillabaisse Buoy, while the ENDEAVOUR
was required to finish its course at Mark A.
As CHARLES JOURDAN headed for Mark A on a starboard
spinnaker reach, another competing racing yacht, LA POSTE, was on
a similar tack, overlapping CHARLES JOURDAN in close proximity to
leeward. Pursuant to IYRR 37.1,1 the CHARLES JOURDAN, being the
windward vessel, was the burdened vessel and was required to keep
clear of LA POSTE. While racing along at eleven knots in this
position, CHARLES JOURDAN caught up with ENDEAVOUR, who was
sailing slower at seven knots and was to windward of CHARLES
JOURDAN converging on a course approximately 40 from that of
CHARLES JOURDAN. Because the CHARLES JOURDAN believed it had
right of way as leeward yacht over the ENDEAVOUR, its crew hailed
the ENDEAVOUR seeking to alter its course. Although the crew of
ENDEAVOUR acknowledged the hail, it failed to change course until
a last minute attempt was made by the master of the ENDEAVOUR to
alter its direction to windward. The boom of the ENDEAVOUR,
which was held in place by a preventor, and thus could not be
sheeted in, struck CHARLES JOURDAN's backstay, damaging the
backstay and rigging.
Pursuant to the IYRRs and the Regatta's Sailing
Instructions, the CHARLES JOURDAN filed a protest against the
1 IYRR 37.1 reads: "A windward yacht shall keep clear of a
leeward yacht."
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ENDEAVOUR. An International Jury was convened,2 and a hearing
was conducted at which evidence was presented and arguments made
by representatives of both vessels. The International Jury found
that ENDEAVOUR was at fault for failing to meet its burden as the
windward yacht under IYRR 37.1. See supra note 1. In a written
decision, which was notified to the parties, the International
Jury disqualified the ENDEAVOUR from the race.3
2 The jury was composed of international judges from France,
Belgium, Andorra, Switzerland, Italy, and the United Kingdom, all
of whom are certified by the International Yacht Racing Union
(IYRU), yacht racing's ruling body.
3 The decision reads as follows:
INTERNATIONAL JURY
Races: Omya Saint-Tropez Series Heat 8th
Coupe D'Autohne Nioulargue
Classic Yachts
ENDEAVOUR and CHARLES JOURDAN sailing in
separate races approached the same
finishing line on converging courses,
reaching on starboard.
CHARLES JOURDAN established an overlap
from clear astern at least 60 feet to
leeward of ENDEAVOUR.
The yachts continued to sail towards the
finish, at this time ENDEAVOUR had ample
room and opportunity to keep clear.
CHARLES JOURDAN was travelling faster
than ENDEAVOUR, when CHARLES JOURDAN was
in ENDEAVOUR's windshadow CHARLES JOURDAN
slowed down and ENDEAVOUR's boom struck
CHARLES JOURDAN['s] backstay and the
collision resulted in serious damage.
ENDEAVOUR never changed her course.
ENDEAVOUR infringed Rule 37.1 and is
disqualified. CHARLES JOURDAN is granted
redress according to Rule 69(c) (Points
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Various incidents happened thereafter which are not
presently relevant. Suffice it to say that the owners of CHARLES
JOURDAN caught up with the ENDEAVOUR sometime in September 1993,
in Maine, and proceeded to file the present action, and to arrest
said vessel. The owners of CHARLES JOURDAN claimed that
ENDEAVOUR is liable in damages to them because of ENDEAVOUR's
violation of IYRR 37.1, as well as the provisions of Article 12
and 13 of the Convention on the International Regulation for the
Prevention of Collisions at Sea ("COLREGS"), 33 U.S.C. 1601 et
seq., 33 C.F.R. 80.1 et seq. They claimed the right to be
compensated for damage to the CHARLES JOURDAN, and for loss of
business and sponsors resulting from the vessel being
incapacitated after the collision. In its answer, the owners of
ENDEAVOUR denied liability and counterclaimed for damages for
loss of business, and for the alleged false arrest of the vessel.
After a lively and mostly unnecessary round of
discovery, the matter went to trial on the admiralty side of the
bench. The district court found that because the IYRRs are the
rules of a private racing organization, they "do not and cannot
preempt the application of the COLREGS which have been adopted by
treaty to govern worldwide." Juno, 865 F. Supp. at 17. The
court thus ignored the findings of the International Jury and
equal to the place she had at the time of
the incident).
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concluded that, under COLREG Rule 13, 33 U.S.C. foll. 1602,4
CHARLES JOURDAN was an overtaking vessel required to keep clear
of ENDEAVOUR. Pursuant to the "Pennsylvania Rule"5 the CHARLES
JOURDAN was presumed at fault. Nevertheless, the court found
that, under COLREG Rule 8, 33 U.S.C. foll. 1602,6 the
4 Rule 13. Overtaking
(a) Notwithstanding anything contained
in the Rules of Part B, Sections I and
II, any vessel overtaking any other shall
keep out of the way of the vessel being
overtaken.
(b) A vessel shall be deemed to be
overtaking when coming up with another
vessel from a direction more than 22.5
degrees abaft her beam, that is, in such
a position with reference to the vessel
she is overtaking, that at night she
would be able to see only the sternlight
of that vessel but neither of her
sidelights.
(c) When a vessel is in any doubt as to
whether she is overtaking another, she
shall assume that this is the case and
act accordingly.
(d) Any subsequent alteration of the
bearing between the two vessels shall not
make the overtaking vessel a crossing
vessel within the meaning of these Rules
or relieve her of the duty of keeping
clear of the overtaken vessel until she
is finally past and clear.
5 The Pennsylvania, 86 U.S. (19 Wall.) 125 (1873) (failure to
abide by navigational rules creates a presumption of negligence).
6 Rule 8. Action to avoid collision
(a) Any action taken to avoid collision
shall, if the circumstances of the case
admit, be positive, made in ample time
and with due regard to the observance of
good seamanship.
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ENDEAVOUR's failure to take action to avoid the collision "was a
significant cause of the accident," and found it 40% at fault.
Juno, 865 F. Supp. at 18.
On the question of consequential damages, the district
court dismissed all claims for loss of charter and sponsorship
income by all parties, for lack of proof. The court reached a
similar conclusion regarding the counterclaims. The court made a
determination of physical damages in the amount of $10,000 to the
CHARLES JOURDAN caused by the collision, which was reduced to
$4,000. This appeal ensued.
ANALYSIS
ANALYSIS
(b) Any alteration of course and/or
speed to avoid collision shall, if the
circumstances of the case admit, be large
enough to be readily apparent to another
vessel observing visually or by radar; a
succession of small alterations of course
and/or speed should be avoided.
(c) If there is sufficient sea room,
alteration of course alone may be the
most effective action to avoid a close-
quarters situation provided that it is
made in good time, is substantial and
does not result in another close-quarters
situation.
(d) Action taken to avoid collision with
another vessel shall be such as to result
in passing at a safe distance. The
effectiveness of the action shall be
carefully checked until the other vessel
is finally past and clear.
(e) If necessary to avoid collision or
allow more time to assess the situation,
a vessel shall slacken her speed or take
all way off by stopping or reversing her
means of propulsion.
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A. Standard of Review
A. Standard of Review
Our standard for reviewing a district court's findings
of fact and conclusions of law made in conjunction with a bench
trial is well settled. We review claimed errors of law de novo.
Williams v. Poulos, 11 F.3d 271, 278 (1st Cir. 1993); Blanchard
v. Peerless Ins. Co., 958 F.2d 483, 487 (1st Cir. 1992). The
district court's findings of fact, however, will not be set aside
unless they are demonstrated to be clearly erroneous. Williams,
11 F.3d at 278; Fed. R. Civ. P. 52(a). In other words, we will
give such findings effect unless, after carefully reading the
record and according due deference to the trial court, we form "a
strong, unyielding belief that a mistake has been made."
Cumpiano v. Banco Santander Puerto Rico, 902 F.2d 148, 152 (1st
Cir. 1992). Where there are two permissible views of the
evidence, the interpretation assigned by the trial court will
therefore be adopted. Williams, 11 F.3d at 278.
The clearly erroneous standard also ordinarily applies
to our review of a district court's resolution of mixed questions
of law and fact. Id. In such situations, however, we are
obligated to determine whether the court's decision was infected
by legal error. If a trial court bases its findings upon a
mistaken impression of applicable legal principles, the reviewing
court is not bound by the clearly erroneous standard. Id.
B. The Contractual Nature of the
B. The Contractual Nature of the
Sailing Instructions and the IYRR
Sailing Instructions and the IYRR
The history of the COLREGS shows that they were enacted
because of the need to establish a code of international rules of
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the road for maritime traffic throughout the world. See H.R.
Rep. No. 447, 95th Cong., 1st Sess. 1977, reprinted in 1977
U.S.C.C.A.N. 509. However, nothing in their history, or in the
public policy issues that led to their enactment, indicates that
they were meant to regulate voluntary private sports activity in
which the participants have waived their application and in which
no interference with nonparticipating maritime traffic is
implicated. Therefore, by entering a regatta with sailing
instructions which unambiguously set forth special, binding
"rules of the road," the participants waive conflicting COLREGS
and must sail in accordance with the agreed-upon rules. We base
this conclusion not only on the nature and history of both the
COLREGS and the private activity in question, but also because of
the strong public policy in favor of the private settlement of
disputes.
Surprisingly, considering the extent and history of the
maritime and yachting tradition within its jurisdiction, we can
find no published cases of this circuit regarding the issues
raised by this appeal. In fact, even outside the First Circuit
there is a dearth of applicable jurisprudence, although older
reported English cases reveal that these questions have not
altogether avoided judicial scrutiny over the years.
The cases that we have found, however, are helpful to
the extent that they establish the principle -- with which we are
in full accord -- that when one voluntarily enters a yacht race
for which published sailing instructions set out the conditions
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of participation, a private contract results between the
participants requiring their compliance therewith. See De Sole
v. United States, 947 F.2d 1169, 1173 (4th Cir. 1991); Clarke v.
The Earl of Dunraven, the Satanita, [1897] A.C. 59, 64, 66;
Meggeson v. Burns, [1972] 1 Lloyd's Rep. 223; Clarke v. Thayer,
43 N.Y.S. 897, 898 (1897).
The legally binding nature of the obligations created
by the IYRR and the sailing instructions is not altogether a new
or revolutionary concept. In 1897, in The Satanita, A.C. at 64-
66, a case involving a collision between two racing yachts
sailing under the rules of the Yacht Racing Association (of Great
Britain), the House of Lords concluded that the owners were bound
by the Association rule making one yacht liable "for all
damages," notwithstanding the liability limitation provisions of
the Merchant Shipping Act. Lord Herschell found that the
"sailing rules by which they have become contractually bound,"
id. at 66, were a valid basis for seeking all damages suffered,
in effect deciding that the limitation of the statute had been
contractually waived. In Clarke v. Thayer, 43 N.Y.S. at 898,
also an 1897 case, but of an American state court, the court held
that a yacht club's racing rule bound a member of the club
participating in a club regatta, notwithstanding a conflicting
navigation law of the United States. The court explained that,
although those laws were imperative, nothing prevented a person
from voluntarily waiving them. Id. More recently, in Meggeson
v. Burns, 1 Lloyd's Rep. 223, a British court found that "the
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parties had agreed to be bound by the IYRU rules and the
[protest] committee's findings of fact, as far as they go, are
final."7 Finally, a recent case in the Fourth Circuit, De Sole,
947 F.2d at 1173, involved a sailing race in which one private
participant collided with another participating vessel owned by
the U.S. Naval Academy. The central issue in that case was the
applicability of the assumption of risk doctrine. In deciding
that issue, the court assumed the applicability of the IYRRs to
race participants and the authority of the protest committee to
determine fault. The De Sole court also strongly implied that
racing authorities may provide for private resolution of all such
disputes, including the apportionment of damages, to promote "the
traditional role of encouraging private determination of
liability." Id. at 1173 n.6.
To our knowledge, only one court has ruled that the
IYRRs are inapplicable. In Sletter v. Hawaii Yacht Club, 1993
A.M.C. 2863 (D. Hawaii 1993), the court ruled that the IYRRs "do
not preempt the applicable statutory provisions." As in the
district court's opinion in the instant case, however, no
reasoning or authority was provided for this conclusion.
In the present case, the Sailing Instructions
established the conditions by which race participants agreed to
be bound. One of these was that "[t]he event [would be] governed
by the International Yacht Racing Rules of the IYRU (1989). . .
7 Curiously, it nevertheless reviewed the evidence, affirmed the
committee's ruling, and then decided the damages to be assessed.
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." These rules, particularly IYRR 37.1, clearly establish that a
windward yacht must keep clear of one to leeward. Supra note 1.
More significantly, however, these rules set out a detailed
mechanism for determining who among competing yachts has
infringed these rules of conduct. See IYRR, Part VI - Protests,
Penalties and Appeals, (Plaintiffs-Appellants' Appendix, Vol.
VIII, pp. 2432a-2437a). The IYRRs, together with the Sailing
Instructions, establish the procedure for filing a protest, see
IYRR 68, and the procedures to be followed thereafter, which
include the conduct of a hearing, at which the parties have a
right to be present, and may introduce and rebut evidence, see
IYRRs 71-74, and which require that the decision of the protest
committee hearing the protest issue a written decision that is
notified to all interested parties, see IYRR 74.6.8 Pursuant to
Amendment No. 1 to the Sailing Instructions in effect for this
Regatta, and the provisions of Appendix 8 of the IYRRs, the
protest committee was substituted by an international jury, whose
decisions on all protests is final and unappealable. See IYRR,
Appendix 8.
These mechanisms were agreed to by the parties for the
resolution of one of the issues that have become the subject of
this suit, i.e., who was at fault for the collision between
8 They even provide an appeals procedure, see IYRRs 77-78, which
although not applicable in this case includes appeals on issues
of rule interpretation, first to the national yachting authority,
and then to the IYRU. These appellate bodies commonly issue
published opinions and comprise a considerable body of
jurisprudence cited and relied upon by yacht racers, and by the
protest committees and international juries.
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ENDEAVOUR and CHARLES JOURDAN. The parties agreed to the
substantive rules for determining fault, they agreed to the
adjudicating forum, and they were apprised of the procedures.
They appeared before this forum, submitted to its jurisdiction,
presented evidence and argument, and thereafter were served with
that body's findings and final decision.
Thus, the CHARLES JOURDAN and the ENDEAVOUR were
contractually bound to race by the rules of the road contained in
the IYRRs, and to resolve issues related to fault for any
collisions according to those rules. This is consistent with the
long-established traditions and rules of conduct of this sport.
See generally J. Rousmaniere, The Golden Pasttime: A New History
of Yachting (1986). Moreover, there is a well-established public
policy encouraging the private resolution of disputes through
arbitration and other non-judicial forums. See Federal
Arbitration Act, 9 U.S.C. 1 et seq.; Allied-Bruce Terminix
Cos., Inc. v. Dobson, U.S. , 115 S. Ct. 834 (1995);
Shearson/Am. Express, Inc. v. McMahon, 482 U.S. 220 (1987);
Southland Corp. v. Keating, 465 U.S. 1, 10 (1984). See also
United Paperworkers Int'l Union v. MISCO, Inc., 484 U.S. 29, 36
(1987) (labor disputes); Vimar Seguros Y Reaseguros, S.A. v. M/V
SKY REEFER, 29 F.3d 727 (1st Cir.) (COGSA), cert. granted, 115 S.
Ct. 571 (1994); Scherb v. Alberto Culver Co., 417 U.S. 506 (1973)
(international arbitration agreements).
We also note that our decision here comports with 2
of the Federal Arbitration Act, which pointedly states that "[a]
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written provision in any maritime transaction . . . to settle by
arbitration a controversy arising out of such . . . transaction
. . . shall be valid, irrevocable, and enforceable." These
conditions exist here.9 Yacht racing is a maritime transaction,
and the provisions of the IYRR establishing the racing rules and
the protest procedures are in writing and binding on
participants.
Furthermore, the procedures established by the IYRR
meet the requirements of due process: there is appropriate
written notification of the allegations, notice is given of the
hearing; the parties are allowed to appear and present evidence
and witness testimony; they may also cross-examine opposing
witnesses and argue orally; and generally, engage in all those
accepted activities held so dear by common law lawyers. Finally,
a written decision, in which findings of fact are made and fault
apportioned, is issued to all interested parties. Equally
important, the evidence is heard soon after the events take place
by a panel of experts who are fully versed in the niceties of the
activity in question. It is hard to find fault with such a
process, particularly when it is exactly what the participants
agreed to.
Insistence on blind application of COLREGS to the facts
of this case is not only unsupported by any historical imperative
in this legislation and contrary to the weight of the sparse
9 Section 1 of the Federal Arbitration Act, 9 U.S.C. 1,
states: "'Maritime transactions,' as herein defined, means . . .
agreements relating to . . . collisions . . . ."
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relevant authority, it is logically unsound. Such application
would turn on its head and render rife with uncertainty the
thousands of private yacht races that take place throughout the
United States and worldwide in which participants voluntarily
agree to be bound by the IYRRs. See De Sole, 947 F.2d at 1170.
The decision could even have a serious negative impact on such
international races as the America's Cup or the yachting events
of the forthcoming Olympic Games in Atlanta. Under such logic,
notwithstanding agreement by Olympic participants to abide by
IYRRs and to have protests decided by international juries, they
could thereafter relitigate any issues in the courts under the
COLREGS. Such absurdity is difficult to countenance, and cannot
have been contemplated by Congress or the treaty negotiating
authorities when the COLREGS were adopted. Such legislation is
simply not applicable to private yacht racing in which the
participants have voluntarily adopted a different set of rules of
the road for application among themselves.10
In sum, the International Jury found the ENDEAVOR
solely responsible for the collision, and it was inappropriate
for the district court to have gone beyond this decision in the
assignment of fault. We conclude that the findings of that forum
were final and binding on the parties, and we therefore reverse
the decision of the district court in that regard.
The question of damages is another matter.
10 As to third parties, of course, the COLREGS fully regulate
normal maritime traffic vis-a-vis private races.
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C. Damages
C. Damages
No provision was made in either the Sailing
Instructions or the IYRRs for the assessment of damages by the
International Jury, and damages were not assessed. In fact, IYRR
76.1 (entitled "Damages") states that "[t]he question of damages
arising from an infringement of any of the rules shall be
governed by the prescriptions, if any, of the national
authority." The De Sole court interpreted this language as
meaning that:
[The] courts are the rightful location of
litigation over yacht racing damages
unless racing union authorities provide,
in essence, for private resolution.
947 F.2d at 1173 n.6. We agree with this conclusion, as only
such matters as are agreed to may be submitted to private
resolution. See International Broth. of Teamsters v. Washington
Emp., Inc., 557 F.2d 1345 (9th Cir. 1977); Anheuser-Busch, Inc.
v. Brewers and Maltsters Local Union, 346 F. Supp. 239 (D. Mo.
1972) (parties cannot be required to submit to arbitration any
dispute which has not been agreed upon for submittal). Thus, the
CHARLES JOURDAN was entitled to claim and prove the damages
caused by ENDEAVOUR, based upon the determination of fault by the
International Jury.
The district court concluded that the ENDEAVOUR caused
the CHARLES JOURDAN damage in the amount of $10,000 and that
neither vessel was able to prove the other claims made. We find
these conclusions to be fully supported by the record and
therefore affirm them. As we have explained, the International
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Jury found the ENDEAVOUR solely at fault for the collision, and
therefore the district court's reduction of the CHARLES JOURDAN's
award to $4,000 based on its finding that the CHARLES JOURDAN was
60% at fault was in error. The district court is ordered to
enter judgment in favor of plaintiffs in the amount of $10,000.
Costs are granted in favor of defendant.11
11 The record shows that an offer of judgment by defendant in
the amount of $50,000 was refused by plaintiff.
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