North of England Protecting & Indemnity Ass'n v. Tesoro Refining & Marketing Co.

FILED

NOT FOR PUBLICATION

SEP 19 2016

UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK

U.S. COURT OF APPEALS

FOR THE NINTH CIRCUIT

NORTH OF ENGLAND PROTECTING No. 14-56362

AND INDEMNITY ASSOCIATION

LIMITED, D.C. No. 2:13-cv-00956-AK-MRW Plaintiff-Appellant,

v. MEMORANDUM*

TESORO REFINING AND

MARKETING COMPANY, LLC,

Defendant-Appellee.

Appeal from the United States District Court for the Central District of California Alex Kozinski, Circuit Judge, Presiding

Argued and Submitted August 30, 2016 Pasadena, California

Before: SILVERMAN, FISHER and WATFORD, Circuit Judges.

North of England Protecting and Indemnity Association (NOE) appeals the

adverse judgment entered after a bench trial in its negligence action against Tesoro

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. Refining and Marketing Company. We have jurisdiction under 28 U.S.C. § 1291,

and we affirm.

1. The district court did not err by rejecting NOE’s claim that Tesoro was

negligent by failing to…

MEMORANDUM *

North of England Protecting and Indemnity Association (NOE) appeals the adverse judgment entered after a bench trial in its negligence action against Tesoro Refining .and Marketing Company. We have jurisdiction under 28 U.S.C. § 1291 , and we affirm.

1. The district court did not err by rejecting NOE’s claim that Tesoro was negligent by failing to deploy a boom with a standoff around the entire vessel before the oil spill. Although Tesoro’s operations manual could be read as requiring a standoff around the entire vessel, the district court did not clearly err by finding the manual ambiguous. The meaning of the manual is not apparent from the manual’s language alone, and extrinsic evidence presented at trial provided substantial evidence for the district court’s finding of ambiguity. Cf. Pac. Gas & Elec. Co. v. G.W. Thomas Dray age & Rigging Co., 69 Cal.2d 33 , 69 Cal.Rptr. 561 , 442 P.2d 641, 644 (1968); Emp’rs Reinsurance Co. v. Superior Court, 161 Cal.App.4th 906 , 74 Cal.Rptr.3d 733, 744 (2008) (considering language and extrinsic evidence to determine the meaning of a contract capable of two or more constructions). Tesoro’s proffered interpretation was consistent…

dissenting:

I respectfully dissent because the district court clearly erred in its treatment of a crucial piece of evidence, Tesoro’s Operations Manual. The manual clearly prescribed the precautionary measures that Tesoro was supposed to have taken—but unfortunately didn’t take—when unloading oil at the Port of Long Beach. The district court excused Tesoro’s failure to comply with its own manual on the ground that the manual was ambiguous. That ruling was clearly wrong.

Section O of Tesoro’s Operations Manual says this:

With all due respect, there is nothing ambiguous in this language. The phrase “a 4’ standoff between the boom and the vessel” means just what it says—that there is to be a standoff of four feet between thé vessel and the boom. Likewise, the phrase '“around any vessel” means around any vessel. The manual does not say “partially *504 around” the vessel, or along one side of the vessel. Around means around. It could not be any clearer that Tesoro’s manual explicitly requires an oil spill containment boom to be maintained with a four foot standoff around a vessel that is transferring persistent oil. This requirement is not only obvious from the clear and unambiguous…