SCOTUS - shipping safety and oil spill cleanup

MARY REICHARD, HOST: It’s Tuesday, the last day of March, 2020.

So glad you’ve chosen to start your day with The World and Everything in It. Good morning, I’m Mary Reichard.

NICK EICHER, HOST: And I’m Nick Eicher. 

The Supreme Court handed down one opinion yesterday. The case involves oil spills and cleanup costs.

A majority of justices held the charterer of an oil tanker is the one responsible for cleanup costs after a spill. 

The case goes back to the year 2004, when a tanker hit an abandoned anchor in a waterway near a docking site in New Jersey. Six thousand barrels of crude oil spilled into the Delaware River. The cleanup cost was $143 million.

REICHARD: Federal law made the ship owner initially responsible for that cost, in part reimbursed by the federal government. Both went after the company that chartered the oil tanker in the first place, CITGO. But CITGO argued its contract with the ship owner meant it only had to use due diligence to ensure the ship’s safety. It didn’t guarantee that everything would go right. 

The court disagreed.

Tough ruling against CITGO, but the majority seven were clear that charter vessel companies can write contracts that place limits on their liability.

(AP Photo/Patrick Semansky) In this March 16, 2020 photo, people walk outside the Supreme Court in Washington. 

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