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Ildhuso Fisheries, Inc. v. Nichols Bros. Boat Builders, Inc.
Citation: 1 F. App'x 659Docket: Nos. 99-35087, 99-35102; D.C. No. CV-97-01047-L
Court: Court of Appeals for the Ninth Circuit; January 7, 2001; Federal Appellate Court
Ildhuso Fisheries, Inc. appeals a judgment favoring Nichols Brothers Boat Builders, Inc. concerning an admiralty action for consequential damages due to a fire on its fishing vessel, the GUN-MAR. Nichols Brothers cross-appeals a $10,000 award to Ildhuso for repair assistance provided by its employee, Gunnar Ildhuso, Jr. Ildhuso contends that the district court wrongly barred its claim for consequential damages, including lost profits, despite acknowledging that such damages are not available under Nichols Brothers’ express warranty. Ildhuso argues that the express warranty’s limitation of liability should not negate claims for breach of implied warranty or negligence. The district court found that the warranty intended to exclude all consequential damages stemming from Nichols’ work, emphasizing that liability disclaimers must be clear and reflect the parties' intent. The court noted that ambiguities in contract language are construed against the drafter. It concluded that the damages limitation applied only to the express warranty of the Repower Contract and improperly extended the exclusion beyond the warranty's context. Nichols Brothers claimed that permitting Ildhuso's claims on other liability theories would undermine the limitation of liability clause, but the court found no contractual support for this defense and noted that a broader exculpatory clause could have been negotiated. While broad exculpatory provisions in maritime contracts are generally enforceable, the court indicated that no such clause existed in this case, and the district court erred in imposing one. Ildhuso also claimed that Nichols Brothers' financial issues undermined the warranty's essential purpose, but the court did not need to address this argument due to its ruling on the express warranty's limitations. The district court's decision to award $10,000 to Ildhuso for Gunnar Ildhuso, Jr.'s assistance in the GUN-MAR repair process was upheld. Despite Nichols Brothers' claims of error, the court found that the trial court's factual determinations were not clearly erroneous. It was established that Gunnar Ildhuso, Jr. was an employee of Ildhuso and acted in the corporation's interest during the repairs, justifying the compensation. Additionally, the court clarified that there is no risk of double recovery, as Gunnar Ildhuso, Jr.'s separate lawsuit against Nichols Brothers pertains to personal injury damages, not the repair services. The award to Ildhuso was affirmed, while the case was partially reversed and remanded, with each party responsible for its own costs. The decision is not for publication or citation in this circuit except under specific conditions.