Dixilyn Drilling Corporation v. Crescent Towing and Salvage Company/Opinion of the Court

Respondent Crescent Towing Company contracted with petitioner Dixilyn Drilling Corporation to tow Dixilyn's barge Julie Ann down the Mississippi River. While being towed, the barge collided with a bridge, and the bridge owners filed a libel in the United States District Court claiming damages from the tower and the barge owner. These two jointly paid the claim but continued to litigate, as between themselves, the question of which was liable. The district judge after a full trial found that the collision and the resulting damage were due solely to the negligence of the tower. He also rejected the tower's argument that regardless of which was negligent the barge owner should pay the damages because it had contracted to assume liability for all damages arising out of the towage including 'any damage claims urged by third parties.' The judge held that the barge owner had not agreed to assume liability for damages caused by the tower's own negligence. On review the Court of Appeals held that it need not decide the 'extremely difficult' factual question of who was negligent because, in the court's view, the barge owner had agreed in the towage contract to assume liability for all losses arising out of the towage, including those caused by the tower's negligence. Holding such a contract to be valid, the Court of Appeals reversed the District Court's judgment.

In treating as valid a contract which exempts the tower from liability for its own negligence, the Court of Appeals' holding is squarely in conflict with our holding in Bisso v. Inland Waterways Corp., 349 U.S. 85, 75 S.Ct. 629, 99 L.Ed. 911 (1955), and Boston Metals Co. v. The Winding Gulf, 349 U.S. 122, 75 S.Ct. 649, 99 L.Ed. 933 (1955). The Court of Appeals thought that the present case was distinguishable because the peculiar hazards of towage and other factors brought it within the ambit of Southwestern Sugar & Molasses Co. v. River Terminals Corp., 360 U.S. 411, 79 S.Ct. 1210, 3 L.Ed.2d 1334 (1959). But Southwestern Sugar is not applicable here, for in that case the Court merely preferred to give the Interstate Commerce Commission an opportunity to rule on an exculpatory clause which was part of a tariff filed with the Commission. We adhere to the rule laid down in Bisso and Winding Gulf and hold that the Court of Appeals was in error in failing to follow it. The judgment is reversed and the cause remanded to that court to consider other questions.

Reversed and remanded.