The opinion of the court was delivered by: Irma E. Gonzalez, Chief Judge United States District Court
MEMORANDUM DECISION AND ORDER
The above-entitled matter came before the Court for trial without a jury on June 14 and 28, and July 10, 11, and 12, 2007. Daniel E. Kenney, Esq. of Harrington, Foxx, Dubrow, and Canter appeared on behalf of KDME, Inc. d/b/a Seaforth Boat Rentals ("Seaforth" or "petitioner"). Kevin F. Quinn, Esq. and Alyson B. Taub, Esq. of Thorsnes, Bartolotta, and McGuire appeared on behalf of Janine and Samantha Bucci ("claimants").
This memorandum decision constitutes the Court's findings of fact and conclusions of law. On February 2, 2005, petitioner filed a complaint for exoneration or limitation of liability. On May 31, 2005, claimants filed a claim. On August 15, 2005, by leave of court, claimants filed a first amended claim alleging that petitioner acted with gross negligence.
This Court has admiralty jurisdiction pursuant to 46 U.S.C. § 181 et seq., 28 U.S.C. § 1333, and Federal Rule of Civil Procedure F. The Court also has diversity jurisdiction pursuant to 28 U.S.C. § 1332. Venue is proper pursuant to 46 U.S.C. § 181 et seq. and Federal Rule of Civil Procedure F(9) because the subject vessel is located in San Diego.
In the Pretrial Order, which the Court signed on June 7, 2007, the parties admitted to certain facts requiring no proof at trial as set forth in Section III of the Pretrial Order. The Court incorporates by reference the facts admitted by the parties that are set forth in the Pretrial Order. The Court's findings of fact are based upon those facts that are admitted in the Pretrial Order and the testimony presented at trial.
On August 25, 2004, claimants, accompanied by Alexandra Bucci and Kimberly Doros, visited Seaforth's Mission Bay location to rent a boat. At the rental counter, Janine Bucci conveyed her reluctance to rent because no one in the group had boating experience. Nicole Earls, who was working at the rental counter that day along with Lauren Sutton, responded to Janine Bucci, "If you can drive a car, you can drive a boat." Ms. Earls recommended a 16-foot Bayliner Capri boat with a 50-horsepower motor. Janine Bucci signed a contract to rent this boat for two hours. (Cls. Exhibit A.) After Janine Bucci signed the rental contract, Ms. Earls provided a map of Mission Bay, indicating where the group could operate the boat.
The group walked down to the dock, where they received further instructions from Ronnie Greathouse, Seaforth's dock manager. Janine Bucci reiterated her concern about renting as a first-time boater, and Mr. Greathouse responded that she could drive a boat because she could drive a car. Mr. Greathouse's job was to provide instruction in how to operate the rental boat safely. Mr. Greathouse focused on giving instructions to Janine Bucci because she was the sole signatory of the contract. After instructing Janine Bucci about boat operation, Mr. Greathouse informed the group that they could also rent, inter alia, an innertube. The group agreed to rent an innertube and, although none were immediately available, the group waited approximately ten minutes for one to arrive from another boat. At Janine Bucci's request, Mr. Greathouse attached the innertube to the boat by clipping two ends of the towline to metal rings on opposite sides of the outboard motor. Mr. Greathouse then pulled the towline and innertube into the boat. He provided Janine Bucci with safety instructions concerning use of the innertube. The total amount of safety instruction lasted less than fifteen minutes.
In determining the substance of the safety instruction that Mr. Greathouse provided to Janine Bucci, the Court finds Janine Bucci to be a more credible witness. Janine Bucci was apprehensive about renting a boat for the first time and thus more likely to recall the details of the instruction she received. By contrast, Mr. Greathouse handled a substantial number of rentals during his employment with Seaforth*fn1 and is less likely to recall the details of his instructions to any particular renter.
Janine Bucci testified that Mr. Greathouse instructed on, inter alia, the steering wheel, throttle, life jackets, the proper speed of operation, and locations to avoid on Mission Bay. Mr. Greathouse did not, however, instruct Janine Bucci to watch him as he attached the innertube to the boat. When Janine Bucci inquired about the proper method for deploying the innertube, Mr. Greathouse instructed her to "just throw it in when you're ready." Janine Bucci likewise testified that she had no recollection of Mr. Greathouse ever referring to the lanyard, i.e., a red string hanging from the throttle that, when pulled, shuts off the boat's engine. Mr. Greathouse did not instruct Janine Bucci to attach the lanyard to the boat operator such that, if the operator moved away from the wheel, the boat would automatically shut off.
Janine Bucci testified the group then drove the boat into Mission Bay. After approximately fifteen minutes of operation, the boat stalled. Janine Bucci called the Seaforth office from her cell phone. Lauren Sutton testified that she answered the phone and unsuccessfully attempted to troubleshoot the group to get the engine restarted. Ms. Sutton then located Mr. Greathouse, who was on lunch break at the time Janine Bucci called. Mr. Greathouse contacted Janine Bucci for further troubleshooting. During this discussion, the engine restarted. Nonetheless, the group indicated they wanted to return to Seaforth's office to obtain a replacement boat, which Mr. Greathouse promised to provide without charge.
On their way back to the Seaforth office, claimants decided to innertube. Ms. Doros then assumed operation of the boat. Having received no instruction from Mr. Greathouse regarding the proper deployment of the innertube, the group deployed the innertube incorrectly. Properly deployed, the towline forms a "Y" configuration relative to the outboard motor. (See Cls. Exhibit F.) Here, the group misdeployed the towline such that all the towline emanated from the port (left) side of the outboard motor. The engine stalled again but was restarted. As the group restarted the boat, Alexandra Bucci adjusted the towline such that it emanated entirely from the starboard (right) side of the outside motor.
Because of the improper deployment, the towline became wedged between the outboard engine and the engine mounting bracket, causing the steering to lock. Therefore, when Ms. Doros moved the throttle into the forward position, the boat made a sharp u-turn to the left, striking the innertube and injuring claimants.
Pursuant to the Limitation of Liability Act ("LOLA"),*fn2 "[t]he liability of the owner of any vessel . . . for any act, matter, or thing . . . done, occasioned, or incurred, without the privity or knowledge of such owner or owners shall not . . . exceed the amount or value of the interest of such owner in such vessel, and her freight then pending." 46 U.S.C. App. § 183(a). In other words, LOLA "limits shipowner liability arising from . . . negligence . . . unless . . . the act of negligence was within the shipowner's 'privity or knowledge.'" In re BOWFIN M/V, 339 F.3d 1137, 1137 (9th Cir. 2003); In re Arntz, 380 F. Supp. 1156, 1158 (C.D. Cal. 2005). The limitation-of-liability inquiry proceeds in two steps. First, the claimant (i.e., the injured party) must prove liability for negligence by a preponderance of the evidence. Carr v. PMS Fishing Corp., 191 F.3d 1, 4 (1st Cir. 1999); In re Muer, 146 F.3d 410, 415-16 (6th Cir. 1998); In re Consolidation Coal Co., 123 F.3d 126, 132 (3d Cir. 1997). If claimant does not carry its burden on negligence, then the Court exonerates the petitioner from liability. In re Hechinger, 890 F.2d 202, 207 (9th Cir. 1989); N. Fishing & Trading Co., Inc. v. Grabowski, 477 F.2d 1267, 1272 (9th Cir. 1973).
A court exercising admiralty jurisdiction "'look[s] to the common law in considering maritime torts.'" Royal Ins. Co. of Am. v. Sw. Marine, 194 F.3d 1009, 1015 (9th Cir. 1999) (quoting Su v. M/V S. ASTER, 978 F.2d 462, 472 (9th Cir. 1992)). In California, "[t]he elements of actionable negligence are  a duty to use due care and  a breach of that duty which  proximately causes the plaintiff's injuries." Wright v. City of Los Angeles, 219 Cal. App. 3d 318, 344 (Cal. Ct. App. 1990). Under California's doctrine of respondeat superior, an employer is liable for an employee's torts when the employee acts within the scope of employment by, ...