Celeste v. Prudential-Grace Lines, Inc.

• Decision Date: 11 July 1974
• Docket Number: PRUDENTIAL-GRACE
• Parties: , 315 N.E.2d 782, 1975 A.M.C. 2059 Carmine CELESTE, Plaintiff, v.LINES, INC., Defendant and Third-Party Plaintiff-Appellant, AMERICAN STEVEDORES, INC., Third-Party Defendant-Respondent.
• Court: New York Court of Appeals Court of Appeals

Page 729

358 N.Y.S.2d 729

35 N.Y.2d 60, 315 N.E.2d 782, 1975

A.M.C. 2059

Carmine CELESTE, Plaintiff, v. PRUDENTIAL-GRACE LINES, INC., Defendant and Third-Party Plaintiff-Appellant, AMERICAN STEVEDORES, INC. Third-Party Defendant-Respondent.

Court of Appeals of New York.

July 11, 1974.

Stevens L. Barkan, for third-party plaintiff-appellant.

Asher Marcus and Peter James Johnson, New York City, for third-party defendant-respondent. GABRIELLI, Judge.

On November 8, 1965, Carmine Celeste, an employee of American Stevedores, Inc., was injured while working as a longshoreman aboard the S.S. Biddeford Victory owned by the defendant Prudential-Grace Lines (Prudential). Alleging that his injuries were caused by the defendant's negligence in the maintenance of the ship's deck, and by the general unseaworthiness of the vessel, Celeste commenced an action against Prudential, who in turn commenced a third-party action against the independent contract stevedore, American Stevedores. This complaint, in essence seeking indemnification, alleged that the third-party defendant being in sole charge of Celeste's work had breached its warranty of workmanlike service to Prudential, and was therefore liable to Prudential for any judgment arising out of the main action. The third-party answer asserted as a complete defense that the claim for indemnification, having been instituted more than six years after Celeste sustained his injuries, was barred by the six-year Statute of Limitations applicable to contract actions (CPLR 213, Consol. Laws, c. 8).

Special Term concluded that the third-party cause of action actually sounded in indemnity and that it thus accrued on the date the breach was committed, viz. the date plaintiff was injured, and therefore CPLR 213 was a complete bar. The Appellate Division affirmed, 42 A.D.2d 692, 345 N.Y.S.2d 950, without opinion.

Conceded by the parties and, of course, critical to the determination of this appeal is the doctrine that a maritime action instituted in State court is governed by Federal maritime principles. It is well established that despite the grant of concurrent jurisdiction in Federal and State courts over maritime actions (U.S.Code, tit. 28, § 1333), State courts are bound to apply Federal law in the resolution of such disputes (Matter of Rederi (Dow Chem. Co.), 25 N.Y.2d 576, 581, 307 N.Y.S.2d 660, 662, 255 N.E.2d 774, 776; Romero v. International Term, etc., Co., 358 U.S. 354, 79 S.Ct. 468, 3 L.Ed.2d 368; Garrett v. Moore-McCormack Co., 317 U.S. 239, 63 S.Ct. 246, 87 L.Ed. 239; Detroit Trust Co. v. Barlum S.S. Co., 293 U.S. 21, 55 S.Ct. 31, 79 L.Ed. 176).

Bound as we thus are, an analysis of the Federal cases discloses that a maritime cause of action for indemnity does not accrue until a judgment has been entered and paid (Hidick v. Orion Shipping & Trading Co., D.C., 157 F.Supp. 477; Mangone v. Moore-McCormack Lines, D.C., 152 F.Supp. 848; Dell v. American Export Lines, D.C., 142 F.Supp. 511; United New York Sandy Hook, Pilots Ass'n v. Rodermond Ind., 3 Cir., 394 F.2d 65; United States v. Farr & Co., 2 Cir., 342 F.2d 383; see, also, Musco v. Conte, 22 A.D.2d 121, 254 N.Y.S.2d 589).

In United New York Sandy Hook, Pilots Ass'n v. Rodermond Ind. (supra) a case directly in point, a longshoreman was critically injured as the result of alleged negligence on the part of the shipowner, and the general unseaworthiness of the ship. After several trial and appellate proceedings, judgment was obtained in plaintiff's favor. Thereafter an action based on indemnity was brought by the shipowner against the general contractor. The contractor moved to dismiss the action on the grounds that since it was commenced some 13 years following plaintiff's injuries, it was barred by New Jersey's six-year Statute of Limitations governing contract actions. The Third Circuit Court of Appeals in treating this issue held that '(t)he general rule, applicable to this case, is that a claim for indemnity does not accrue until the indemnitee's liability is fixed by a judgment against or payment by the indemnitee' (United New York Sandy Hook Pilots Ass'n v. Rodermond Ind., Supra, 394 F.2d p. 75).

Special Term erroneously, we think, relied on dictum in Ryan, etc., Co. v. Pan-Atlantic S.S. Corp., 350 U.S. 124, 76 S.Ct. 232, 100 L.Ed. 133, wherein it was stated that a shipowner's cause of action for breach of a 'warranty of workmanlike service * * * is comparable to a manufacturer's warranty of the soundness of its manufactured product'; and, likewise, citing Mendel v. Pittsburgh Plate Glass Co., 25 N.Y.2d 340, 305 N.Y.S.2d 490, 253 N.E.2d 207, Special Term reasoned that the cause of action for a breach of workmanlike service should thus accrue on the date the services were improperly rendered. The Supreme Court in Ryan, etc., Co. (supra) in analogizing the breach of warranty of...