In re Brown

IN THE MATTER OF THE COMPLAINT OF PATRICIA KOTHE FOR EXONERATION FROM OR LIMITATION OF LIABILITY CARMEN BROWN, Respondent.

Case No. 15-cv-8876

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION

September 26, 2017

Judge Robert M. Dow, Jr.

MEMORANDUM OPINION AND ORDER

Petitioner Patricia Kothe, as owner of the recreational sailing vessel Three's Company, brings this action for "Exoneration from or Limitation of Liability" pursuant to the Limitation of Liability Act, 46 U.S.C. § 30501, et seq. ("Limitation Act"). See [1]. This matter arises from the drowning death of Daniel Brown ("Brown"), who fell from Three's Company while it was sailing on Lake Michigan on August 9, 2014. Prior to this action, Respondent Carmen Brown, Administrator of the Estate of Daniel Brown, commenced a wrongful death action in the Circuit Court of Cook County, Illinois, alleging negligence by Petitioner. Through Petitioner's complaint in this Court, she seeks to limit her liability to the value of the vessel ($6,000) and to enjoin the state court action. This Court already enjoined the prosecution of any pending or further court action or proceeding against Petitioner or her property with respect to the August 9 drowning incident, in accordance with 46 U.S.C. § 30511(c), including Respondent's state court suit. See [13]. Currently before the Court is Respondent's motion for summary judgment [37]. For the reasons set forth below, Respondent's motion [37] is denied. The case is set for further status on October 17, 2017 at 9:00 a.m.

I. Background¹

The following facts are undisputed except where otherwise noted. The Court takes the relevant facts from the parties' Local Rule 56.1 statements of undisputed material facts and supporting exhibits: [38] and [44]. As an initial matter, the Court notes that Respondent failed to respond to Petitioner's Local Rule 56.1(b)(3)(C) statement of additional facts contained within her response to Respondent's Local Rule 56.1(a)(3) statement of undisputed material facts. See [44] at 24-32. Therefore, pursuant to Local Rule 56.1, Petitioner's additional fact statements are deemed admitted. N.D. Ill. L.R. 56.1(a)(3) ("All material facts set forth in the statement filed pursuant to [Local Rule 56.1](b)(3)(C) will be deemed admitted unless controverted by the statement of the moving party."); see also Robinson v. Bandy, 524 F. App'x 302, 305 (7th Cir. 2013) (nonmovant's submitted facts were deemed admitted under Local Rule 56.1 where the moving party did not submit a reply); Raymond v. Ameritech Corp., 442 F.3d 600, 608 (7th Cir. 2006) (affirming district court's decision to admit the facts set forth in moving party's Local Rule 56.1 submission where nonmovant failed to timely respond); De v. City of Chicago, 912 F. Supp. 2d 709, 712-13 (N.D. Ill. 2012) ("The Seventh Circuit has repeatedly held that a districtcourt has broad discretion to require strict compliance with Local Rule 56.1.") (citation and internal quotation marks omitted).

A. Three's Company and the Time-Share Agreement

Petitioner is an experienced sailor, who has been sailing for more than 30 years and who has been certified by the American Sailing Association. In 1998, Petitioner purchased Three's Company, a 1977 O'Day 27-foot sailboat. At some point before February 2014, Richard Barrows became a co-owner of the boat.² [44] at ¶¶ 2, 3, 13.

In order to decrease her portion of the boat expenses, Petitioner sought time-share partners. In late winter of 2014, Brown, a 56-year-old Chicago resident, answered a flier posted by Petitioner at her yacht club. See [44] (Additional Facts) at ¶ 3. Brown ultimately entered into a six-way Time-Share Agreement ("Agreement") with co-owners Petitioner and Barrows and four other individuals, which he signed on February 16, 2014. [44-6] (Three's Company 2014 Time-Share Agreement, May 2014-April 2015). As relevant, the Agreement stated:

All parties understand that sailing is a potentially hazardous activity and that we accept any and all risks of injury or death while participating in said activity. All participants agree that we will not make a claim against or sue the other partners for injury or damage unless there is gross negligence involved.

Id. at 2. The Agreement further provided that all monetary contributions of the time-share members (or partners) would be payable to Petitioner and would be held in a checking account in the name of "Patricia Kothe - Boat Fund." Id. at 1. The funds were to be "managed" by Petitioner and Barrows and "allocated toward anticipated and normal boat operating, storage and maintenance expenses" accordingly. Id.

As part of their arrangement, Petitioner gave Brown an orientation of the boat, which included showing him how to operate the radio, which was in a fixed location in the boat's cabin,and where the emergency equipment and floatation devices were located. See [44] (Additional Facts) at ¶ 8. Specifically, Three's Company had the following floatation devices on board: eight to ten personal floatation devices, three square floatable cushions, and a horseshoe-shaped floatation device that was mounted in a bracket and secured on the boat by a rope. [38] at ¶¶ 4, 24. Petitioner and the other partners had discussed attaching the horseshoe-shaped device to a rope; Petitioner was not involved in actually tying the rope to the device. [44] (Additional Facts) at ¶ 11. As relevant to this case, the boat also had a safety perimeter on deck consisting of a lifeline (a thick or braided wire) that was threaded through the top of "stanchions," or vertical posts that are affixed to the deck. [44-1] (P. Kothe Dep.) at 27:15-21; [38] at ¶ 11; [44] at ¶ 14. Petitioner testified at her deposition that the lifeline had not been replaced at any point during her ownership of the boat. [38] at ¶ 13.

The parties dispute whether Petitioner was solely responsible for maintenance of the boat. Although record evidence indicates that Petitioner assumed certain responsibilities for ensuring that the boat was properly maintained and arranging that maintenance (at least monetarily and for the 2014 season), she disputes that she had the sole responsibility for this task, and she testified that, historically, the boat partners would "perform" the maintenance as needed.³ See also [44-6] (Three's Company 2014 Time-Share Agreement, May 2014-April 2015) at 2 ("All parties will contribute as equally as possible according to their areas of expertise toward the maintenance and housekeeping of the boat * * *."). The same goes for ensuring that the emergency and safety equipment were in good working order; although Petitioner testified in her deposition that she "kept that as [her] responsibility," she disputes that she was solely responsible for such things. [44] at ¶¶ 5-6. In addition to routine maintenance, the record indicates that the United StatesCoast Guard performed an unknown number of complimentary "inspections" of the boat, although the record is not clear when these inspection(s) occurred, but indicates only that they were sometime prior to August 9, 2014. In any event, according to Petitioner, the Coast Guard had never reported an issue with the lifeline during its inspections. [44] (Additional Facts) at ¶ 1. In addition, Petitioner confirmed in her deposition that the lifeline was "frequently" tested simply through "normal usage" of the boat. [44-1] (P. Kothe Dep.) at 24:11-13.

As an additional fact, while Chicago Harbors was launching Three's Company into Lake Michigan at Montrose Harbor in Chicago, Illinois at the start of the 2014 season, the boat collided with an object and a stanchion was bent. [44] at ¶ 14. The stanchion (and the wood underneath it) was subsequently repaired in April 2014, and the individual who repaired the boat allegedly told Petitioner that the lifeline was "fine."⁴ Id.

B. The August 9, 2014 Incident

On August 9, 2014, Brown commissioned Three's Company for personal use. According to Petitioner, all of the parties to the Time-Share Agreement understood that the party who commissioned the boat for use on a particular day was responsible for the pre-departure inspection of the boat, which included "checking" the life jackets and other personal flotation devices, flare guns and other emergency equipment, Coast Guard radios, engine, sails, and electrical system. In other words, the commissioning party—on August 9, 2014, Brown—was to make sure that the boat was in good working condition. [44] (Additional Facts) at ¶¶ 9, 13. The record indicates that Petitioner was not present for the pre-departure inspection nor did she have knowledge of or details regarding its occurrence.

Brown and Patrice San Filippo boarded the boat at Montrose Harbor (where it was docked) in the afternoon; Brown motored the boat south on Lake Michigan to Belmont Harbor, where Patrick Unkrur and Danielle Bastian came on board. Id. at ¶¶ 15-18. Brown failed to provide his guests with information about the nature and location of boat's floatation devices and other emergency equipment. Id. at ¶ 21. Still, Brown continued to drive the boat on the lake with the assistance of the motor, taking it back to Montrose Harbor, where Petitioner and Barrows joined the group. Id. at ¶ 22. At that point, the boat left the harbor, the sails were put up, and the boat again traveled south on the lake, this time with Unkrur at the helm. Id. at ¶¶ 23-24. Four of the boat's passengers testified that Brown was either drinking alcohol and/or smoking marijuana on the boat. Id. at 28.

At some point, Three's Company turned north back to Montrose Harbor, and Petitioner took the helm. Id. at ¶ 26. The weather had been "rough" during the entire trip (see, e.g., [44-3] (P. Unkrur Dep.) at 21:15), and it intensified during the trip north; a strong northeast wind that was blowing at more than 12 miles-per-hour started to become a concern and began to cause large waves. [44] (Additional Facts) at ¶¶ 30-31. While Pet...