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United States v. Water Quality Insurance Syndicate4/7/2005
Reporter of Decisions
Argued: October 20, 2004
[ ] The United States District Court for the District of Maine (Hornby, J.) has submitted certified questions to this Court pursuant to 4 M.R.S.A. § 57 (Supp. 2004) and M.R. App. P. 25. The certificate requests that we answer the following questions:
1. Does 24-A M.R.S.A. § 2904 [(2000)] apply to policies other than those defined in 24-A M.R.S.A. § 707 [(2000 & Supp. 2004)] as policies of casualty insurance?
2. May an insurance policy appropriately characterized as one of marine insurance as defined in 24-A M.R.S.A. § 708 [(2000)] also be characterized as one of casualty insurance pursuant to 24-A M.R.S.A. §§ 701 & 707 [(2000 & Supp. 2004)] for the purpose of application of 24-A M.R.S.A. § 2904?
This case involves the United States government's attempt to reach and apply the proceeds of an insurance policy issued by the Water Quality Insurance Syndicate (WQIS) covering a fishing vessel that sank off the coast of Maine. After the vessel was lost, the United States government expended sums to recover its fuel supply to prevent environmental damage.
[ ] We answer the federal court's first question in the affirmative and decline to answer the second.
II. BACKGROUND
[ ] Gulf of Maine Trawlers, Inc. (GMT) operated a fishing trawler by the name of Jessica Ann. GMT's sole officer and shareholder, Zenon Gogola, served as captain of the Jessica Ann. On August 6, 1999, GMT obtained an insurance policy covering the Jessica Ann for any liability under the Oil Pollution Act, 33 U.S.C.A. §§ 2701-2761 (2001 & Supp. 2004). WQIS underwrote the policy.
[ ] In the early hours of February 20, 2000, after a night of drinking, Gogola and three crewmen departed Portland on a fishing expedition to Wilkinson Basin. As the ship got underway at approximately 2:00 a.m., Gogola ordered crewman Ken Davis to take the helm. Davis set the ship's course, but did not plot it on a chart or manually take fixes. At about 4:00 a.m., the Jessica Ann struck an object in the water, which Davis believed was Alden Rock. The crew abandoned ship at 4:30 a.m. and the vessel sank in about 130 feet of water.
[ ] The United States Coast Guard rescued the crew at about 7:00 a.m., at which time emergency workers gave breath tests to Gogola and Davis. Gogola's blood-alcohol content was 0.11 and Davis's was 0.12. Gogola subsequently pled guilty to operating a commercial fishing vessel in a grossly negligent manner, in violation of 46 U.S.C.A. § 2302(b) (Pamph. 2004) and 33 C.F.R. §§ 95.015(b), 95.050(a) (2004). Davis pled guilty to one count of operating a commercial fishing vessel under the influence of alcohol, in violation of 46 U.S.C.A. § 2302(c) (Pamph. 2004) and 33 C.F.R. §§ 95.015(b), 95.050(b) (2004).
[ ] To prevent environmental damage, the Coast Guard launched an operation to remove the Jessica Ann's fuel supply. The removal costs, which totaled $930,510.09, were covered by the Oil Spill Liability Trust Fund pursuant to 33 U.S.C.A. §§ 1321(s), 2712(a)(1)(A) (2001). On January 13, 2003, GMT voluntarily paid the federal government $80,906.21. Two weeks later, the United States sued GMT for the remaining balance of $849,603.88. GMT did not defend the lawsuit. The United States notified WQIS that GMT had been sued and was not planning on defending the suit, but WQIS did not appear to defend the case. On May 22, 2003, the United States District Court for the District of Maine entered a judgment against GMT for the full amount sought, plus costs, interest, and attorney fees.
[ ] The United States filed suit against WQIS, seeking to recove
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