Sixth Circuit Resolves Damages Dispute in Land Damage Case

On Friday, a panel of Sixth Circuit Judges reversed a judgment from the Western District of Tennessee and remanded for entry of an amended damages award to the City of Memphis for land damage caused by a tugboat running aground.  The judgment by District Judge Sheryl H. Lipman was originally for $1,145,990. 

The City of Memphis and managing agent of the damaged land, Riverfront Development, Inc. sued Wepfer Marine, Inc. in July 2016 for negligence.  Wepfer Marine’s tugboat, the “Lucy Wepfer,” ran aground on Mud Island, a small peninsula on the Mississippi River in Memphis.  Due to running aground, the Coast Guard had to “dislodge” and remove the boat and the barge it was towing from Mud Island.  As a result, damage was caused to the tip of Mud Island in the form of “two (2) large holes gorged out of the land mass.”  The plaintiffs sought damages to be awarded for the cost of restoring Mud Island back to its previous condition, which included filling in the holes with human intervention, using limestone or sand.

Wepfer Marine only appealed the damages ruling.  The Sixth Circuit rejected all of Wepfer’s claims, except one.  The panel found the district court “did commit one clear error in calculating the damages award.”  The district court’s damages order awarded Riverfront “the cost of excavating and refilling the depressions caused by Wepfer’s negligence.”  Furthermore, the district court accepted Riverfront’s original measurements of the holes and that sand would be the proper material to fill in these holes.  Wepfer’s argument that sediment from the river filling the holes would suffice to fix the damage done was rejected. 

Wepfer’s challenge to the district court’s finding as to the cost of excavation was the only argument the circuit court agreed with.  Wepfer argued that the district court erred in the volume of sentiment that needed to be removed.  The original estimate that was accepted by the district court determined that the holes had a volume of 10,000 cubic yards, which was supplemented by a 20% “contingency” increase to account for the compaction of fill material. Riverfront used this 12,000 cubic-yard measurement as the basis for its final 9,208 cubic-yard figure, which was used to estimate the cost of excavation as $623,990.  The circuit court noted “[Wepfer] has a point” and “[t]he court clearly erred in calculating the amount to be excavated as 9,208 cubic yards.” 

The error was due to accepting the 12,000 cubic yards “as the baseline for the size of the holes for excavation purposes, when that figure included roughly 1,900 to 2,000 extra cubic yards of material for filing purpose.”  When Wepfer’s counsel questioned the addition of this figure in the calculation of the excavation cost; Riverfront’s representative replied, “I didn’t say it would.”  Additionally, the circuit court noted the correct measurement for excavation volume is likely 7,208 cubic yards.  The new cost of excavation would be $501,490, about $122,500 less than awarded. 

The court thus remanded the damage award to be amended by the district court stating, “[w]e will leave it to the district court to recalculate the proper number on remand without the use of any compaction contingency.”

The City of Memphis and Riverfront Development were represented by The Spence Law Firm and Fletcher Law Firm.  Wepfer Marine was represented by Henderson Dantone. The panel of Circuit Court Judges consisted of Judges Batchelder, Stranch, And Murphy, with Judge Murphy writing the opinion.