Culver v. Slater Boat Co.

• Decision Date: 04 May 1981
• Docket Number: No. 79-3985,EURO-PIRATES,79-3985
• Citation: 644 F.2d 460
• Parties: Ruth CULVER et al., Plaintiffs-Appellants Cross-Appellees, v. SLATER BOAT COMPANY et al., Defendants-Appellees Cross-Appellants,INTERNATIONAL, INC., et al., Defendants-Appellees and Cross- Appellees-Appellants, v. ODECO DRILLING et al., Defendants-Appellees Cross-Appellants. . Unit A
• Court: U.S. Court of Appeals — Fifth Circuit

Page 460

644 F.2d 460

Ruth CULVER et al., Plaintiffs-Appellants Cross-Appellees, v. SLATER BOAT COMPANY et al., Defendants-Appellees Cross-Appellants, EURO-PIRATES INTERNATIONAL, INC., et al., Defendants-Appellees and Cross- Appellees-Appellants, v. ODECO DRILLING et al., Defendants-Appellees Cross-Appellants.

No. 79-3985.

United States Court of Appeals, Fifth Circuit.

Unit A

May 4, 1981.

Rehearing En Banc Granted June 24, 1981.

W. James Kronzer, W. W. Watkins, Houston, Tex., Frederick J. Gisevius, Jr., New Orleans, La., for plaintiffs-appellants cross-appellees.

Richmond M. Eustis, New Orleans, La., for Slater Enterprises, Europirates, etc.

Drury, Lozes & Curry, Felicien P. Lozes, New Orleans, La., for Gulf Overseas Ser. Corp.

J. Walter Ward, New Orleans, La., for Ocean Drilling.

Mat M. Gray, III, New Orleans, La., for St. Paul Fire.

Appeals from the United States District Court for the Eastern District of Louisiana.

Before AINSWORTH and SAM D. JOHNSON, Circuit Judges, and HUNTER ^*, District Judge.

AINSWORTH, Circuit Judge:

This maritime personal injury case raises several issues, including the use of an inflation factor to compute future loss of earnings, the construction of jury instructions and interrogatories, and the rights to indemnity between actively and passively negligent tortfeasors. The district court's disposition of the indemnity issue requires a slight modification; in all other respects we affirm the district court.

I. FACTS

Curtis Culver, the husband and father of plaintiffs-appellants, was the foreman of an anchor-pulling crew employed by Gulf Overseas Marine Corporation (Gulf). Shell Oil Company (Shell) contracted with Gulf to provide an anchor-pulling crew to assist in moving the drilling barge OCEAN QUEEN to a new location off the Louisiana coast in the Gulf of Mexico. In their anchor-pulling operations, the Gulf crew used the vessel M/V BLACK BART which was owned by Charles D. Slater d/b/a Slater Boat Company and leased under a bareboat charter to Euro-Pirates International, Inc. (collectively EPI). The OCEAN QUEEN was owned and maintained by Ocean Drilling & Exploration Company (ODECO). Essentially, the Gulf crew's job was to use the machinery on the BLACK BART to lift the anchors of the OCEAN QUEEN out of the seabed, to float the drilling barge to its new location, and to anchor it again there. To get control of the anchor line, the Gulf crew, under the direction of foreman Culver, first "lassoed" a buoy attached to the anchor line and brought the buoy aboard the BLACK BART. Then, a set of unusual circumstances combined to produce the unfortunate accident which gives rise to this lawsuit. The anchor line was too short, and the BLACK BART drifted away from the OCEAN QUEEN; thus, the cable "lasso" was holding not only the weight of the line but also the weight of the anchor. The taut cable "lasso" raked across a jagged surface of the buoy and severed. As the buoy raced back over the deck of the BLACK BART and into the water, it struck Culver who had left his position of safety at the stern of the vessel to inspect the line. Culver died from his resulting injuries.

Culver's widow and children sued Shell, Gulf, EPI, and ODECO under the Jones Act, 46 U.S.C. § 688, the Death on the High Seas Act, 46 U.S.C. § 761 et seq., maritime tort, and negligence. Shell was dismissed as a party defendant. The remaining defendants filed appropriate cross-claims. A jury found all the remaining three defendants negligent, the BLACK BART unseaworthy and Culver free from contributory negligence. As between the defendants, on their cross-claims for indemnity, the district court found each actively negligent and not entitled to indemnity from either of the other two. The judge held that Gulf was negligent because its employee, Curtis Culver, failed to remain in his position of safety away from the anchor line. However, the district judge did not disturb the jury's finding of no negligence ¹ on the part of Culver in the main action.

In determining the damages sustained by the Culvers for the death of Curtis, the district judge allowed testimony concerning discount rates and the earning power of money invested in low risk bonds. The judge instructed the jury to "discount the total amount" of any award for loss of future services or support by a percentage that represents an appropriate rate of interest. ² The interrogatory submitted to the jury ³ was returned with a discount rate of 25% filled in. The judge decided that obviously the jury had misunderstood, and he substituted the only other rate put into evidence, 9.125%. ⁴ The total award after discounting was $238,861.05. The district judge did not allow testimony, charges, or interrogatories to be submitted on the effects of inflation on any damage award, citing Johnson v. Penrod Drilling Co., 510 F.2d 234 (5th Cir.), cert. denied, 423 U.S. 839, 96 S.Ct. 68, 46 L.Ed.2d 58 (1975), as his reason therefor.

II. INFLATION FACTORS

The Culvers' principal contention is that this circuit's en banc decision in Johnson v. Penrod Drilling Co., supra, relating to the use of an inflation factor to compute future loss of earnings, has been overruled either by changed circumstances or by the Supreme Court's decision in Norfolk and Western Railway Co. v. Liepelt, 444 U.S. 490, 100 S.Ct. 755, 62 L.Ed.2d 689 (1980). In Penrod, we held that "the influence on future damages of possible inflation or deflation is too speculative a matter for judicial determination." 510 F.2d at 241. Therefore, "triers of the facts should not be instructed to take into account future inflationary or deflationary trends in computing lost earnings." Id. The Culvers argue that the extremely high rates of inflation this country has experienced in recent years make the Penrod rule an unjust anachronism and that in any case, Liepelt has overruled Penrod.

In Liepelt, the Supreme Court responded to an argument that future prediction of tax consequences is "too speculative and complex for a jury's deliberations":

Admittedly there are many variables that may affect the amount of a wage earner's future income tax liability. The law may change, his family may increase or decrease in size, his spouse's earnings may affect his tax bracket, and extra income or unforeseen deductions may become available. But future employment itself, future health, future personal expenditures, future interest rates, and future inflation are also matters of estimate and prediction. Any one of these issues might provide the basis for protracted expert testimony and debate. But the practical wisdom of the trial bar and the trial bench has developed effective methods of presenting the essential elements of an expert calculation in a form that is understandable by juries that are increasingly familiar with the complexities of modern life. We therefore reject the notion that the introduction of evidence describing a decedent's estimated after-tax earnings is too speculative or complex for a jury.

444 U.S. at 494, 100 S.Ct. at 758.

Our recent decision from Unit B of the Fifth Circuit in Byrd v. Reederei, 638 F.2d 1300 (5th Cir. 1981), specifically addresses the continued vitality of Penrod and is dispositive of the issue here before us. In Byrd, we noted first that "(a)n en banc decision of our court may be overruled only by subsequent en banc consideration or by the United States Supreme Court." Id. at 1308. Byrd then considered the argument for admitting inflation factors in light of Liepelt. "Liepelt 's favorable dicta is only that. Thus, until the Supreme Court speaks more directly or we, as an en banc court, decide otherwise, Penrod still applies ...." 638 F.2d at 1308. We are in agreement with Byrd 's disposition of the Liepelt issue.

III. INCOME INCREASES

The Culvers next object to the district judge's not allowing them to argue to the jury that Curtis Culver's wages would increase over time and that the jury should take this into account in its award of future support. As we read the record, the district judge refused to permit the Culvers to argue such increases for two reasons. First, the Culvers offered no evidence to show that such an argument was warranted. ⁵ Curtis Culver's tax returns for the preceding five years showed that his income was level, not increasing, and Culver had reached the top of his particular line of work. Plaintiffs' counsel's attempt to prove increases were not sufficiently relevant to Culver's particular circumstances. ⁶ Second, the trial judge stated that possible job promotions and merit wage increases were merely an indirect way of putting inflation factors into evidence before the jury and were thus not allowed under Penrod. We find no error in the trial judge's rulings concerning wage increases. ⁷

IV. DISCOUNT RATE

The Culvers also object to the district judge's substitution of 9.125% for 25% as the discount rate to be applied to the jury's award. The Culvers argue either that a rate of 25% per year is manifestly unjust and does not conform to the evidence, thereby entitling them to a new trial, or, alternatively, that the jury's application of a 25% total discount cannot be disregarded and replaced by a yearly rate put into evidence by a defense witness. We recognize that the jury instruction and the interrogatory concerning the discount rate were subject to either a "total" or a "per year" interpretation. ⁸ However, it is clear to us that the parties and the court intended, and the law requires, ⁹ a per year rate. A 25% lump sum reduction in the award is not a rate. The trial judge was faced with a situation where applying a 25% per year discount would have been unjustly harsh and applying a 25% reduction would have been contrary to the law. The Culvers chose not to put evidence of a discount rate into the record. Although they had an economist on their witness list, they did not call him to testify. Adopting the rate suggested by the defendants' expert was a proper...