BP May No Longer Bask In the Robbins Dry Dock Rule

The BP oil spill has left many businessmen in coastal areas out of work for an extended period of time. These businessmen are seeking compensation for the loss in business they have incurred as a result of this disaster. However, federal maritime law presents them with a big problem. A rule known as the Robins Dry Dock Rule, named after the legal case that established it, may prevent some of these people from recovering.

Under this rule, a party cannot seek recovery for pure economic losses, which as an example, would be the loss in revenue of a fisherman for his or her inability to fish off the coast. The Robins Dry Dock Rule requires that this economic loss be accompanied by a physical damage to a person or his property. This would mean that the fisherman was not only unable to fish during the spill, but that the oil itself damaged property such as a dock or a ship. Because the BP oil rig was offshore, many of the businessmen affected by the disaster have not incurred any physical damage to their property in that manner. Under the Robins Dry Dock Rule, they would not be able to recover their damages.

However, the promise of recovery for these unfortunate businessmen might not be that bleak. Another law, the Oil Pollution Act of 1990, has established much broader criteria under which parties may recover. This act provides for recovery for purely economic loss to real or personal property that is owned or leased, or to natural resources. These means that fisherman with an interest in the natural resources of the ocean, namely fish, may be able to recover for their loss in revenue.

Although this seems like good news, the Oil Pollution Act has set up a great deal of red tape that might make these businessmen’s hopes of recovery slightly less feasible. In this instance, the party seeking to recover must present their claims directly to BP, and if the claim is denied or it is not settled within 90 days, then the party must seek recovery from a trust fund that was set up as a result of the spill. Time will tell whether BP will be cooperative on these suits, and whether this trust fund will be easily accessible.

-Evan Aronson, Legal Intern