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Canal Barge Co. v. Torco Oil Co.

ELR Citation: 30 ELR 20732
Nos. No. 99-30002, 220 F.3d 370/(5th Cir., 07/20/2000)

The court affirms a magistrate judge's decision awarding an oil transporter $90,766 for damages arising from hazardous sludge loaded onto the transporter's barge by the seller of spent lube oil. The seller contracted with the transporter to carry 18,000 barrels of spent lube oil. The seller did not have enough oil to fill 18,000 barrels and, therefore, allowed the transfer pump to suck air for 5 to 10 minutes, ultimately transferring hazardous sludge to the transporter's barge along with the spent oil. Consequently, the barge required extensive cleaning and could not be used for 80 days.

The court first holds that the magistrate judge properly allowed testimony of the transporter's expert witness concerning fluid dynamics because the seller opened the door to the testimony during its cross-examination of the expert. The court next holds that the seller owed a legal duty to the transporter to alert the transporter of the transfer method used and the possibility of harm to the transporter's barge. The seller could have anticipated that its decision to drain its tank down to the bottom and failure to stop the loading of oil before the sucking of air would likely result in the harm suffered by the transporter. Moreover, the court holds that the magistrate judge did not err when it found that the seller's draining of the tank violated industry custom. The court then holds that the magistrate judge did not err in finding that the sludge removed from the transporter's barge was hazardous waste. No one attempted to recover the sludge, the material was found to be solid, and it was found to have a benzene level greater than .5 parts per million. The court also holds that the magistrate judge's award of damages was appropriate based on the seller's testimony of lost profits.

Counsel for Plaintiff
Stewart F. Peck
Lugenbuhl, Burke, Wheaton, Peck, Rankin & Hubbard
Pan-American Life Center
601 Poydras St., 27th Fl., New Orleans LA 70130
(504) 568-1990

Counsel for Defendants
Michael L. Vincenzo
King, LeBlanc & Bland
3800 Bank One Center
201 St. Charles Ave., New Orleans LA 70170
(504) 582-3800

Before King and Duhe, JJ.