State Bar of Texas Volume 30, Number 2 December 2005

OFFIC ERS:

Brian R. Sullivan, Chairman 1201 Spy glass Road, Suite 200 OIL, GAS AND Austin, Texas 78746 (512) 32 7-8111

Arnold J . Johnson, Chairman-Elect 350 Glenborough Drive, Suite 100 ENERGY Houston , Texas 77067 (281) 87 2-3352

Richard D. Watt, Vice Chairman 1010 Lam ar, Suite 1600 RESOURCES Houston , Texas 77002 (713) 650-8100

Michael P. Pearson, Secretary 1401 McKinney Street, Suite 1900 Houston, Texas 77010 (713) 752-4311

Norma Rosner Iacovo, Treasurer 1701 E. Lamar Blvd., Suite 100 Arlington, Texas 76006 (817) 462-1507

Laura H. Burney, Immediate Past Chairman 7801 Broadway, Suite 200 San Antonio, Texas 78209 (210) 821-3377

COUNCIL:

TERM EXPIRES 2006 Rod Wetsel, Sweetwater Jay G. Martin, Houston Fabene Welch, Houston

TERM EXPIRES 2007 William B. Burford, Midland Tim George, Austin David Roth, San Antonio

TERM EXPIRES 2008 Timothy Brown, Houston Michael E. Curry, Midland Jolisa M elton Dobbs, Dallas

NEWSLETTER EDITOR:

SECTION REPORT Jay G. M artin 3900 Essex Lane Houston, Texas 77027 (713) 439-8439

OFFICIAL PUBLICATION OF THE OIL, GAS AND ENERGY RESOURCES LAW SECTION OF THE STATE BAR OF TEXAS COVER PHOTO PROVIDED BY WILL HURRICANE KATRINA FURTHER counter-clockwise winds pushed Lake DEFINE THE “ACT OF GOD” DEFENSE? Pontchartrain's waters southward toward New Orleans. By: Michael Chernekoff and Amy Cowley 1 The levees surrounding New Orleans Jones Walker breached or failed, flooding approximately eighty percent of the city with flood waters I. Introduction up to twenty feet deep.3 Southeast Louisiana and southern Mississippi suffered Hurricane Katrina was perhaps the widespread catastrophic damage. worst in American history. Less than three days before Katrina Hurricane Katrina made landfall at 6:10 made landfall, the National Hurricane am on Monday August 29, 2005, in lower Center had projected landfall in the eastern Plaquemines parish near the town of Buras, portion of the Florida panhandle, several as a Category Four hurricane, with hundred miles to the east of the actual sustained winds of over 140 miles per hour. landfall. It was not until late evening on Only hours earlier, the National Hurricane Friday August 26th that forecasters revised Center reported that Katrina had been their projections to target the New Orleans recorded as Category Five storm, then the area as the center of probable landfall. third strongest Atlantic storm in recorded Thus, emergency preparedness officials in history, with 175 miles per hour sustained Southeast Louisiana had to stage the winds. Exodus of over one million people in a period of less than 48 hours. Virtually all of The National Oceanic and Atmospheric Southeast Louisiana was ultimately subject Administration (NOAA) later reported that to mandatory evacuation orders, leaving Katrina-related storm surges topped 25 homeowners and businesses precious little feet.2 time to batten down, secure and leave. In the end, the overwhelming force of Katrina Katrina's tidal surge and winds made nearly useless many of the destroyed nearly everything in its path as it precautions taken. moved from Buras northward. It passed just east of New Orleans and then made a Nearly four weeks later, another major second landfall on the southwest coast of storm, Hurricane Rita, tore through the Gulf Mississippi, unleashing another massive on a track two hundred miles east of tidal wave and destroying nearly everything Katrina's, this time pounding ashore along there for miles inland. As Katrina passed the coast lines of Southwest Louisiana and New Orleans and into Mississippi, its Southeast Texas.

1 Michael Chernekoff and Amy Cowley are with The Mineral Management Service the law firm of Jones Walker. Mr. Chernekoff is (MMS) later reported that 3050 of the 4000 a partner and chair of the firm's Environmental & platforms it administers in the Gulf were in Toxic Practice Group. He normally resides either Katrina's or Rita's path. More than at the firm's New Orleans Office, but, due to one hundred offshore facilities were Hurricane Katrina, he is temporarily at the firm's destroyed and another fifty platforms Houston Office. Mrs. Cowley is an associate in suffered serious damage. Also, MMS the firm's New Orleans office. reported on October 4, 2005, a week after 2 See, Technical Report 2005-01, NOAA's Rita, that 90% of Gulf oil production and National Climatic Data Center, Hurricane Katrina, A Climatological Perspective, Preliminary Report, October 2005. 3 Id.

38 72% of Gulf gas production was still shut under federal legislation, state law, and in.4 maritime law and questions, in light of the unique circumstances of Hurricane Katrina, Inland, Katrina knocked out of whether courts may reconsider their commission refineries in the New Orleans reluctance to apply the defense to Katrina- area; Rita did the same in the Lake Charles, related spills. Louisiana, and Beaumont, Texas areas. Near New Orleans, oil storage tanks were II. THE “ACT OF GOD” DEFENSE pushed — or floated off — from their bases, or washed away or totally crushed or Federal courts have for years narrowly otherwise destroyed, some not to be found. construed the “Act of God” defense Tank contents were spilled out and washed established in federal environmental by Katrina’s surges hundreds of feet and, in statutes. Although Congress has provided some cases, even a mile away. for the defense, courts have routinely refused to apply it to spills and releases The U.S. Coast Guard reported that resulting from extraordinary events by along the Mississippi River there were six finding some act of human agency as a major spills of over one hundred thousand contributory cause of the event at issue. gallons (one of over one million gallons), Maritime and Louisiana state law, however, three medium spills of over ten thousand have given a somewhat more liberal gallons and 127 minor spills; all totaled — application of the defense. Katrina accounted for more than eight million gallons spilled and eight miles of A. Common Law Application shoreline impacted.5 Following the disaster, landowners and fisherman filed class action The “Act of God” Defense has been lawsuits against the facilities who suffered accepted by courts in negligence and strict the releases. liability cases for more than three centuries. English common law addressed the “Act of God” defense in the case of Coggs v. Who is responsible for these spills? 6 Could facility operators have prevented Bernard, wherein Justice Powell reasoned these spills? Could they have taken that a bailee is liable for damage resulting additional precautions? And, would those from his neglect, “but not such accidents additional steps have protected those tanks and casualties as happen by the act of such that the tanks – and the resulting spills God….” Nevertheless, the distinction – would have been spared Katrina’s wrath? between acts of God and negligent acts of Was there anything anyone could have man has been the subject of much debate done to prevent oil spills in the face of for centuries. Early common law Katrina? Or, were the spills a result of an jurisprudence wrestled with this distinction act of God? in cases ranging from strict liability of common carriers to cases involving This article reviews the judiciary’s narrow reservoir failures. In general, British jurists interpretation of the “Act of God” defense and American counterparts have attempted to limit acts of God to those events truly without human fault.7 4 See, Mineral Management Service Press Release, “Interior Secretary Gale Norton

Reports on Gulf of Mexico Energy Status,” 6 October 4, 2005. Coggs v. Bernard, 92 Eng. Rep. 107, 108 (1703). 5 See, US Coast Guard Press Release, 7 Nugent v. Smith, 1 C.P.D. 423, 444 (1876) (an “Southeast Louisiana Post-Hurricane Pollution accident must be caused exclusively and directly Recovery Continues,” October 21, 2005. by natural causes, and it “could not have been 39 As early as 1868, American courts have property committed to its custody.”13 construed the “Act of God” defense as Maritime law, however, limits the application excluding the idea of human agency.8 The of the “Act of God” defense to “events in court stated it is not an act of God, “if it nature so extraordinary that the history of appears that a given loss has happened in climatic variations and other conditions in any way through the intervention of man.”9 the particular locality affords no reasonable Overall, the “Act of God” defense has warning of them.”14 generally failed in American jurisprudence when the event reasonably should have Maritime cases have recognized hurricanes been anticipated in light of past knowledge, as acts of God.15 The “Act of God” defense or if antecedent negligence on the part of under federal as applied to the defendant worsens the situation.10 hurricanes was explained in Skandia Co. v. Star Shipping AS:16 B. Maritime Law Notably, hurricanes, such as Maritime law recognizes the “Act of God” Hurricane Georges, are considered defense in the absence of human fault. The in law to be an "Act of God." Even “Act of God” defense applies only when: (1) though storms that are usual for the accident is due directly and exclusively waters and the time of year are not to natural causes without human "Acts of God," a hurricane that intervention, and (2) no negligent behavior causes unexpected and by the defendants contributed to the unforeseeable devastation with accident.11 In The Majestic,12 the United unprecedented wind velocity, tidal States Supreme Court defined the act of rise, and upriver tidal surge, is a God as “a loss happening in spite of all classic case of an "Act of God." human effort and sagacity.” Courts have However, forecasting the tracks, further expanded the definition of an “Act of speeds and tidal surges of a God” to include “any accident, due directly hurricane is one of the most and exclusively to natural causes without challenging and difficult tasks human intervention, which by no amount of encountered by meteorologists, and foresight, pains, or care, reasonably to have despite aircraft, land, and shipboard been expected could have been prevented;” reconnaissance, weather satellites, and “a disturbance…of such unanticipated and other data sources, exact force and severity as would fairly preclude hurricane paths and associated charging…[Defendants] with responsibility flooding are rarely predicted with for damage occasioned by the [Defendant’s] precision.17 Instead, hurricane failure to guard against it in the protection of tracks exhibit "humps, loops,

prevented by any amount of foresight and pains 13 Terre, supra, at 91. and care reasonably to be expected from him.”). 14 8 Id.; (citing, Warrior & Gulf Navigation Co. v. Polack v. Pioghe, 35 Cal. 416 (1868). United States, 864 F.2d 1550, 1553 (11th Cir. 9 Id. at 423. 1989). 10 Binder, Denis, “Act of God? Or Act of Man?: A 15 Id; (citing, 1A C.J.S. Act of God at 757 (1985); Reappraisal of the Act of God Defense in Tort and Compania De Vapores Inso S.A. v. Missouri Law” 15 Rev. Litig. 1, 1996. Pacific R.R. Co., 232 F.2d 657, 660 (5th Cir. 1956). 11 Terre Aux Boeufs Land Co., Inc. v. JR Gray Barge Company, 00-2754, (La.App. 4 Cir. 16 173 F.Supp.2d 1228 (S.D.Ala. 2001) 11/14/01); 803 So. 2d 86. 17 See William J. Kosch, Weather for the 12 166 U.S. 375 (1897). Mariner, 151 (2d ed. 1977).

40 staggering motions, abrupt course Fourth Circuit agreed with the trial court that and/or speed changes, and so forth Hurricane George was an act of God that [,]" which in turn, alter flood caused a barge to go aground onto predictions. Id. As a result, landowner's property. The appellate court determining liability for losses agreed that ªno amount of prudence or care resulting from "Acts of God" are on the part of the defendants could have highly fact-specific and the court©s prevented the property damage by the ultimate conclusions should turn on stranding of the barge on [plaintiff's] whether the weather conditions were property.º23 foreseeable as "U.S. courts do not find foreseeable risks to be perils of U.S. v. Pittsburgh Plate Glass Company24 is the sea."18 another example in which the court determined a hurricane was an act of God. A defendant may be found negligent but still The United States brought suit to recover be exonerated from liability of the "Act of expenses incurred for removal of sunken God" if it would have produced the same barges. The court upheld the District damage, regardless of that negligence, Court's ruling that Hurricane Besty was the because the defendant©s negligence was inevitable cause of the sinking, and no not the proximate cause.19 Accordingly, human skill or precaution could have regardless of the type of "heavy weather," "it prevented it. The court found no evidence is certain that human negligence as a indicating negligent mooring, tending or contributing cause defeats any claim to the surveillance of barge. ©Act of God© immunity [,]" because an "Act of God" is not only one which causes damage, Similarly, another court found Hurricane but one as to which reasonable precautions Betsy to be an act of God in In the Matter of and/or the exercise of reasonable care by Marine Leasing Services.25 There, the winds the defendant, could not have prevented the were reportedly over ninety miles per hour damage from the natural event.20 Indeed, in the Baton Rouge area during the storm an "Act of God" will insulate a defendant and hundreds of barges were set loose on from liability only if there is no contributing the Mississippi River. The court indicated human negligence and the defendant has that no precaution or preparation which the burden of establishing that weather carriers could have reasonably been conditions encountered constituted an expected to make would have prevented the uncontrollable and unforeseeable cause by sinking of the barges.26 In fact, the court "Act of God."21 noted, ªNo fleet of barges, no matter how well secured, was able to withstand the fury In Terre Aux Boeufs Land Co., Inc. v. JR of the storm.º27 Gray Barge Company,22 the Louisiana C. Louisiana Tort law

18 See Thyssen, Inc. v. S.S. Eurounity, 21 F.3d The Louisiana Supreme Court has defined 533, 539 (2d Cir. 1994). an act of God as, ªa providential occurrence 19 See Warrior, 864 F.2d at 1553 (citing to or extraordinary manifestation of the forces Glisson v. City of Mobile, 505 So.2d 315, 319 (Ala.1987)). 23 Id., at 93. 20 See Gilmore and Black, The Law of 24 th 421 F.2d 255 (5 Cir. 1973). Admiralty at 163-64. 25 328 F.Supp. 589 (E.D. La. 1971). 21 See, Freedman & Slater, Inc. v. M.V. Tofevo, 222 F.Supp. 964 (S.D.N.Y.1963). 26 Id., at 597. 22 Supra, note 8. 27 Id.

41 of nature which could not have been (ªCERCLAº)33 was enacted to address the foreseen and the effect thereof avoided by releases of hazardous substances. the exercise of reasonable prudence, Pursuant to CERCLA, the EPA may take diligence and care or by the use of those actions to clean up hazardous substances means which the situation renders that have been released or where they are reasonable to employ.º28 Generally, if an threatened to be released. CERCLA injury occurs as a result of an act of God, permits the federal government to mandate the defendant is ordinarily not responsible private parties to assume cleanup actions. for failing to take precautions against an However, those who incur clean up costs extraordinary force. Nevertheless, if an act may seek recovery of those costs from of God is concurrent with a defendant's liable parties, as well as, contribution misconduct, which constitutes a ªsubstantial between private parties. ,º the defendant may be liable.29 CERCLA imposes liability for potentially Louisiana courts have recognized inclement responsible parties (PRPs), which include weather to be acts of God, including storms the following: with winds of 35 to 40 miles per hour.30 Yet, any negligence which constitutes a Present owners and operators of the ªsubstantial factorº will bar the defense. In facility. Southern Air Transport v. Gulf Airways,31 defendant's plane rolled along a ramp and Past owners or operators who collided with and damaged plaintiff's plane owned or operated the facility at the during a severe thunderstorm.32 The time hazardous substances were Louisiana Supreme Court found that the act deposited or disposed of at the of God, i.e, the thunderstorm, was not the facility. sole cause. Rather, the court concluded that the defendant should have set the Any person who by contractual parking brakes to prevent damage to the agreement or otherwise arranged to other plane. Plaintiff provided expert have waste taken to a facility for testimony that opined that the plane would disposal or treatment where a not have rolled if the brakes would have release or threatened release been set. occurs.

D. Comprehensive Environmental Any person who selects and Response, Compensation and Liability transports hazardous waste to a Act facility for disposal or treatment.

The Comprehensive Environmental Pursuant to CERCLA, an ªAct of Godº is Response, Compensation and Liability Act defined as ªan unanticipated grave natural disaster or other natural phenomenon of an exceptional, inevitable, and irresistible character, the effects of which could not 28 Southern Air Transport v. Gulf Airways, 40 So. have been prevented or avoided by the 2d 787 (La. 1949). exercise of due care or foresight.º34 In order 29 Sarden v. Kirby, 660 So. 2d 423 (La. 1995). to succeed under the ªAct of Godº defense, the potentially responsible party must prove 30 LM Barnett v. Duraso, 479 So. 2d 675 (La.App. 3 Cir. 1985); Fournier v. City of New by a preponderance of the evidence that a Orleans, 533 So. 2d 1044 (La.App. 4 Cir. 1989). 31 Supra, note 20. 33 42 U.S.C. §9601, et seq. 32 Id. at 789. 34 42 U.S.C. §9601(1).

42 natural disaster/phenomenon was the sole asserted as `acts of God' would not cause of the occurrence and ensuing qualify as `exceptional natural damage. It must also prove that the phenomenon'. For example, a major innocent defendant acted with due care hurricane may be an `act of God,' but in under the circumstances.35 The difficulty in an area (and at a time) where a establishing the defense is that a grave hurricane should not be unexpected, it natural disaster must be the sole cause of would not qualify as a phenomenon of the damage and defendant could not have exceptional character.'38 reasonably anticipated the event.36 CERCLA's terms are broadly defined. In Apex Oil Company, Inc. v. U.S.A.,37 the Courts have broadly construed the statute in District Court provided guidance on the order to give effect to its remedial purposes. Congressional intent of the ªAct of Godº Nevertheless, an otherwise responsible defense in CERCLA: party may escape liability upon a showing by preponderance of the evidence that the Congressional intent is clearly that the release and the resulting damages were ªexceptional natural phenomenonº (i.e. caused solely by an act of God, act of war, the act of God) defense be construed as or the acts or omission of a third party much more limited in scope than the unrelated to the defendant.39 As the traditional common law ªAct of Godº following cases illustrate, proving the ªAct of defense. The discharger's burden of Godº defense is a difficult task to proof on the defense of ªexceptional accomplish. natural phenomenaº is much more onerous than that required for common In U.S. v. Alcan Aluminum Corp.,40 the law or traditional ªact of Godº defense. defendant's used oil emulsion was The legislative history of CERCLA commingled with other oily wastes includes the following explanation containing hazardous substances, which regarding the singular ªdefense for discharged from a mine tunnel into the exceptional natural phenomena.º The Susquehanna River in the wake of defense for the exceptional natural Hurricane Gloria. Defendant argued that phenomenon is similar to, but more Hurricane Gloria caused one hundred limited in scope than, the traditional `act thousand gallons of oily waste contaminate of God' defense. It has three elements: to be discharged into the river. The court the natural phenomenon must be rejected Alcan's ªAct of Godº defense for exceptional, inevitable, and irresistible. three reasons. First, no reasonable fact Proof of all three elements is required finder could conclude that Hurricane Gloria for successful assertion of the defense. was the sole cause of the release and The `act of God' defense is more resulting response costs. nebulous and many occurrences The court reasoned, ªTwo million gallons of 35 42 U.S.C. §9607(b). hazardous waste were not dumped into the borehole by an act of God, and were it not 36 See, U.S. v. Stringfellow, 661 F. Supp. 1053, for the unlawful disposal of this hazardous 1061 (C.D. Cal. 1987) (defense rejected because act of God not sole cause); U.S. v. waste Hurricane Gloria would not have Alcan Aluminum Corp., 892 F. Supp. 648, 658 (M.D. Pa. 1995); U.S. v. Barrier Industries, Inc., 38 Id. at 652-653 (emphasis added) (citing H.R. 991 F. Supp. 678, 679 (S.D.N.Y. 1998) (spills of Rep. 99-253(IV) 1986 U.S.C.C.A.N. 3068, 3100) hazardous substances caused by bursting of 39 pipes occasioned by unprecedented cold spell 42 U.S.C. §9607. were not caused by act of God). 40 892 F. Supp. 648 (M.D. Pa. 1995), judgment 37 208 F.Supp. 642 (E.D. La. 2002) aff'd, 96 F.3d 1434 (3d Cir. 1996).

43 flushed 100,000 gallons of this chemical the ªAct of Godº defense applies.46 The soup into the Susquehanna River.º41 Court stated: Second, the court determined that the effects of Hurricane Gloria could have been Heavy rainfall was not an prevented or avoided by the exercise of due exceptional natural phenomenon care or foresight. The court justified its view and was not ªact of Godº within the by stating, ª[The] exercise of due care or meaning of defenses to payment of foresight would have militated against response costs incurred as result of dumping hazardous wastes into a mine release of hazardous substance tunnel that inevitably led to such a from toxic waste disposal site, where significant resource as the Susquehanna rains were foreseeable based on River.º42 Third, the court followed the normal climatic conditions, and decision of U.S. v. Stringfellow,43 ruling, where harm caused by rain on toxic ªheavy rainfall is `not the kind of waste disposal facility could have `exceptional' natural phenomenon to which been prevented through design of the act of God exception applies.'º44 proper drainage channels.47

The Court found contributing human The Court struck down the ªAct of Godº negligence in the very method in which the defense based upon every element of its waste was discarded. Essentially, the definition provided in CERCLA. The Court court's denial of the ªAct of Godº defense denied the defense for the following was twofold. First, the court based its reasons: foreseeability of the rain; the decision upon the unlawful disposal of the extent of storm; and other, multiple causes hazardous waste -- but for the unlawful of the release.48 The rainstorm was not of disposal, Hurricane Gloria would not have an ªexceptionalº natural phenomenon to flushed one hundred thousand gallons of which the ªnarrowº ªAct of Godº defense ªchemical soupº into the river. The dumping applies, and the rains were foreseeable.49 also could have been avoided if the The Court alluded to other causes of the defended had exercised due care and release by stating that the storm was not the foresight by not dumping hazardous wastes sole cause, but it failed to identify the other into a mine tunnel that led to the river. causes. Furthermore, the presence of Second, heavy rainfall was not considered human negligence can be inferred from the an ªexceptional natural phenomenonº Court's reasoning that the harm could have required by the ªAct of Godº defense. been prevented by the design of proper drainage. In U.S. v. Stringfellow45, the court held that heavy rainfall was not a natural disaster In U.S. v. M/V Santa Clara,50 the ªAct of such that it could be considered an act of Godº defense was deemed inapplicable God to avoid liability for the release of where containers of arsenic trioxide and hazardous substances. The court found magnesium phosphide were lost overboard that the rains were not the kind of during a storm. The Court relied on ªexceptionalº natural phenomenon to which evidence that the National Weather Service predicted inclement weather offshore, and

41 Id. at 658. 46 Id. at 1061. 42 Id. 47 Id. 43 783 F.2d 821. 48 Id. 44 Id., (citing 661 F.Supp. 1053, 1061 (C.D. Cal. 1987)). 49 Id. 45 661 F.Supp. 1053, 1061 (C.D. Cal. 1987). 50 887 F. Supp. 825 (D.S.C. 1995).

44 such information was known by the captain removal costs¼that result from such and crew prior to their departure.51 The incident.54 Court went one step further by stating, ª[e]ven if the evidence demonstrated that OPA allows a PRP the right to seek the storm was worse than predicted, this reimbursement from the Oil Spill Liability court finds that the storm the M/V Santa Trust Fund, for the removal costs and Clara I encountered was not the type of damages incurred, just as CERCLA `unanticipated grave natural disaster' or provides a method of reimbursement from `other natural phenomenon,' necessary for the Superfund. In addition, an act of God is the ªAct of Godº defense.52 an enumerated affirmative defense.55 The act of God definition in OPA is identical to Jurisprudence illustrates an that of CERCLA: ªan unanticipated grave interpretation of ªAct of Godº defense so natural disaster or other natural narrow that courts could continuously phenomenon of an exceptional, inevitable, circumvent the defense by finding some act and irresistible character the effects of by man which would negate the ªsoleº which could not have been prevented or cause requirement. Clearly, it is difficult to avoided by the exercise of due care or escape liability on such a defense. foresight.º56 Moreover, with advanced technology and meteorology, inclement weather is In Apex Oil Company v. US, the court foreseeable to a certain extent. Albeit compared the OPA with CERCLA and found hurricanes are generally foreseeable, the both to be strict liability statutes that, absent exact path and strength are not. In fact, fault or exercise of due care, there is no they are highly unpredictable. defense.57 In Apex, the oil company brought Nevertheless, the jurisprudence interpreting an action against the U.S. and appealed the CERCLA makes it difficult for a defendant to denial of its reimbursement claim of an oil present a successful argument challenging spill clean-up, which stemmed from an foreseeability. The success of the ªAct of accident involving the company's barge. Godº defense hinges on the underlying The company claimed that a 1995 flood, facts. along with exceptionally strong and unpredictable currents in the Vicksburg E. Oil Pollution Act area, constituted an unanticipated grave natural disaster or other natural The Oil Pollution Act of 1990 (ªOPAº)53 phenomenon, unavoidable even with the addresses a variety of issues associated exercise of due care and foresight.58 with preventing, responding to, and paying for oil pollution. OPA provides, in pertinent part:

[E]ach responsible party for a vessel or a 54 33 U.S.C. § 2702(a) facility from which oil is discharged, or which 55 33 U.S.C. § 2703(a) (A responsible party will poses the substantial threat of a discharge not be held responsible for removal costs and of oil, into or upon navigable waters or damages if that party is able to establish, by a adjoining shorelines ¼ is liable for the preponderance of the evidence, that the incident or threat was caused solely by an act of God, an act of war, or the act or omission of a third party). 51 Id., at 843. 56 33 U.S.C. § 2701(1). 52 Id. 57 208 F. Supp. at 653. 53 33 U.S.C. § 2702, et seq. 58 Id. at 645.

45 The National Pollution Fund Center faster waters with an underpowered (ªNPFCº) rejected Apex's defense, and the tug contributed to the discharge. 61 district court upheld the decision. NPFC cited a number of reasons for denying Apex is yet another decision in which the Apex's claim for recovery costs, concluding ªAct of Godº defense was denied on the that Apex's decisions played some part in basis that the negligent act of man the allision. The analysis focused on the contributed to the accident, despite the following pertinent factors: (1) whether the extraordinary event. Just as courts circumstances constituted an unanticipated, interpreted the ªAct of Godº defense grave natural disaster or other natural pursuant to CERCLA, courts addressing phenomenon of an exceptional, inevitable, OPA's ªAct of Godº defense are equally and irresistible character; (2) whether the reluctant to allow parties to escape liability effects of the natural phenomenon could and to recover costs from the have been prevented by the exercise of due Congressionally-established cleanup fund, diligence and foresight; and (3) whether the finding that the extraordinary event was not grave natural disaster or other natural the ªsoleº cause of the release. phenomenon was the sole cause of the discharge. In the final analysis, Apex failed F. The Federal Water Pollution Control Act all three inquiries.59 (Clean Water Act)

NPFC ultimately held that Apex could have The Federal Water Pollution Control Act prevented or avoided the problems at the (also known as the ªClean Water Actº) allision site during the flood stage by (ªCWAº)62 establishes the basic structure for utilizing a higher-powered tug that could regulating discharges of pollutants into the safely maneuver the strong currents that waters of the United States. Prior to the were predicted.60 Furthermore, even Exxon Valdez spill and the ensuing assuming that the flood and strong enactment of OPA, section 1321 of the associated currents were an act of God, the CWA governed the release of oil into US NPFC director concluded that Apex was not waterways. entitled to recover because it failed to show that the damage was caused entirely by an Section 1321 of the CWA imposes strict act of God. The NPFC observed: liability upon an owner or operater of a facility or vessel unless it can prove that one Apex chose not to interrupt its of the exceptions applies.63 The CWA normal navigation in the face of defines an act of God as ªan act occasioned floods, which Apex admitted it knew by unanticipated grave natural disaster.º64 about. Further, Apex chose to To qualify as an ªAct of Godº defense the transit the flotilla into this riskier alleged occurrence must satisfy each environment with an underpowered element of the definition: (1) unanticipated, tug to tow the barges. This (2) grave, (3) natural, and (4) disaster. underpowered tug was the Unlike CERCLA, the CWA third party proximate cause of the discharge of oil.¼ The facts reflect that the Apex decision to navigate into higher and 61 Id., at 648. 62 22 U.S.C. §1251. 63 Sabine Towing & Transp. Co. v. United States, 229 Ct.Cl. 265, 268, 666 F.2d 561 59 Id., at 647. (1981). 60 Id. 64 33 U.S.C. §1321(a)(12).

46 defense does not include due care and Based on the foregoing, the court ultimately negligence limitations.65 held that the ªAct of Godº defense as defined in the CWA is to be strictly In Sabine Towing & Transportation Co., Inc. construed.69 As such, an ªact of Godº is v. United States,66 the court held that applicable if it results solely from a grave neither a spring runoff of melted snow, nor natural disaster and if that grave natural an unknown water object which was struck disaster is wholly unanticipated. by a vessel was an act of God so as to relieve liability for oil spill cleanup costs. The Court discussed each requisite of the The Court, in its reasoning, relied on act of God definition. It interpreted the CWA Congressional intent to assess the extent to as requiring the ªdisasterº in question to be which the act of God should be recognized the cause and not the effect of an as a defense. Ultimately the court accident.70 Furthermore, the court determined that, ªCommon-law cases on reasoned that ªunanticipatedº within the acts of God, to the extent that they embody definition of act of God exception cannot be judicial decisions on allocating the burden of read to cover regular and frequent mishap, should not be used to determine conditions, like freshets, where the dangers the allocation that Congress intended in the are expected and where the losses are `act of God' exception to liability for oil normally worked into the cost of doing spillage in navigable water.º67 The court business.71 looked to Congressional committee notes that stated:68 In Liberian Poplar Transports, Inc. v. United States,72 oil discharged into a river when a The term ªact of Godº is defined to thunderstorm occurred as oil was mean an act occasioned by an transferred to vessel. The captain of the unanticipated grave natural disaster. vessel checked the weather conditions prior This definition varies from that of the to the commencing of transfer and found no Senate definition and, under this reports of severe weather.73 Thereafter, the definition, only those acts about crew did not monitor the radio for weather which the owner could have had no conditions but contended that a third mate foreknowledge, could have made no on watch observed no signs of the plans to avoid, or could not predict impending storm as late as thirty minutes would be included. Thus, grave before the storm hit.74 natural disasters which could be anticipated in the design, location, or The thunderstorms were not deemed to operation of the facility or vessel by come within the CWA act of God exception. reason of historic, geographic, or In its reasoning, the Court first turned to the climatic circumstances or other statute, legislative history, and case law phenomena would be outside the construing the ªAct of Godº defense of the scope of the owner's or operator's responsibility.

65 Lincoln Props v. Higgins, 823 F. Supp. 1528 69 Id. (E.D. Cal. 1992). 70 Id., at 565. 66 Supra, note 51. 71 Id. 67 Id., at 564. 72 26 Cl.Ct. 223 (1992). 68 st Id., citing Conf. Rep. No. 940, 91 Cong., 2d 73 Id., at 224. Sess., reprinted 1970, U.S. Code Cong. & Ad. News 2712, 2722. 74 Id.

47 CWA.75 According to legislative history an Authority (ªVIWPAº) filed suit for act of God encompassed:76 reimbursement of removal expenses incurred when a fuel leaked into Christian Only those acts about which the Harbor. VIWPA contended that Hurricane owner could have had no Hugo caused a retaining wall encircling a foreknowledge, could have made no fuel tank to collapse, which caused a six- plans to avoid, or could not inch storm drain pipe to strike and break the predict¼.Thus, grave natural tank's inline thermometer, thereby allowing disasters which could not be fuel to escape through the broken anticipated in the design, location, or thermometer.80 Fourteen thousand barrels operation of the facility or of Number Six fuel oil spread to the harbor. vessel¼would be outside the scope Although a court did not rule on the ªAct of of the owner's or operator's Godº defense, it stayed the federal responsibility. proceeding for further administrative review. Subsequently, reportedly, the government The court reasoned that if the crew had and VIWPA settled with the government monitored the radio for weather conditions issuing a reimbursement for costs incurred. they could have anticipated and taken precautions against storm.77 The plaintiff's With the exception of the duty of care contended that the storm was not well requirement provided in CERCLA and OPA, forecasted, not visually foreseeable and not the ªAct of Godº defense is interpreted no anticipated by the ship's watch. The court, differently under CWA. The act of God nevertheless, explained the anticipation must be the ªsoleº cause of the release, and inquiry is not a subjective test.78 It noted each of the four requisites Ð unanticipated, that the storm was forecasted at least a grave, natural, and disaster Ð must be half-hour before it hit and a storm watch established. was issued an hour before it struck. Therefore, the Court concluded that storm III. CONCLUSION: HOW WILL COURTS could have been anticipated, which negated ADDRESS CLAIMS RELATED TO the ªAct of Godº defense. HURRICANE KATRINA?

Another CWA case is Virgin Islands Water Until now, the ªAct of Godº defense has met 79 and Power Authority v. U.S., wherein the with both resistance and skepticism by ªAct of Godº defense was raised based courts and the federal administrative upon Hurricane Hugo. Hurricane Hugo tribunals charged with guarding the federal struck the Virgin Islands causing major spill funds. Courts have been reluctant to damage. Virgin Islands Water and Power allow defendants in commerce to avoid liability for harm caused by that commerce 75 In dicta, the court stated that common-law to the environment or to others' property. In cases construing the act of God defense, to the cases involving commerce, the courts have extent they involve judicial decisions on shifted the burden heavily upon the allocating the burden of mishap, should not be commercial actor, almost creating a strict used in determining the allocation that Congress intended in the act of God exception. Id., at 226. liability regime. 76 st Id. (citing, Conf. Rep. No. 940, 91 Cong., 2d Some human agency can be found in Sess., reprinted in 1970 US Code Cong. & virtually any spill event. A complete defense Admin. News 2712, 2722.) to liability is entertained only in the most 77 Id.. extraordinary of circumstances. In this way, 78 Id. 79 30 Fed.Cl. 236 (1994). 80 Id., at 237.

48 courts have maintained the viability of the out trust fund dollars for reimbursement can defense while at the same time not created only do so if the fund is solvent. Courts will precedent to open the proverbial ªflood be reluctant to put pressure on these gates.º agencies and uphold the ªAct of Godº defense and award recoveries if these trust Similarly, guardians of the ªpublic fiscº have funds are not sufficiently solvent. Current only reluctantly parted with their precious Congressional hurricane relief packages spill trust fund dollars. Administrative rulings being considered do not address the routinely deny the ªAct of Godº defense. In CERCLA or OPA trust funds. several instances, valid claims for reimbursement have been denied only to be Hurricane Katrina was an unprecedented resolved by closely guarded settlements. natural disaster. It caused unprecedented Again, the government is reluctant to create damage to property, to natural resources any precedent that would encourage claims and the environment, and to lives. Claims against the trust fund. for recovery of cleanup costs and for cleanup damages will be brought on many Nevertheless, Congress allowed for the levels. Local and state governments' ability application of the ªAct of Godº defense to to address the damage caused already is otherwise strict liability spill occurrences. strained. Insurers will also be put to the And, while Congress may have intended test, and courts will be asked to give rulings that it be applied sparingly, it is a real on claims that were perhaps completely defense to liability that must be given real, unanticipated. Government at all levels ± not feigned, consideration. the courts included Ð will be faced with difficult public policy decisions in response That one could anticipate hurricanes in the to Katrina to determine how will the burden Gulf of Mexico in August and September of paying for the cost of Katrina be belies the fact that man-made structures allocated. and well-thought out and implemented safety plans were absolutely no match for Whether Katrina results in the creation of this most destructive natural force. While exceptions to the current ªrules,º new rules each claim for federal trust fund dollars and altogether, or more of the same, is yet to be each defense to property damage must rise seen. And, as Rita followed Katrina, what is or fall on its own facts, administrative in store next year and thereafter? agencies and courts will ± or should ± be hard pressed to conclude that human agency could have prevented the total destruction of tanks, vessels, platforms and pipelines which in turn resulted in oil and chemical spills, unless they are of the view that no one should have built such structures along the Gulf of Mexico where they would be prone to damage by hurricanes. Courts and administrative agencies must give a more sympathetic consideration of the ªAct of Godº defense, more than has been the case to date, in addressing Katrina-related claims.

Congress must also step in and address the cost of remediating Katrina-related spills. Administrative agencies charged with doling

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