Drake v. Raymark Industries, Inc.

• Decision Date: 27 August 1985
• Docket Number: Nos. 84-2033,84-2034,s. 84-2033
• Citation: 772 F.2d 1007
• Parties: , Prod.Liab.Rep.(CCH)P 10,707 Mildred V. DRAKE, Plaintiff, Appellee, v. RAYMARK INDUSTRIES, INC., et al., Defendants and Third-Party Plaintiffs, Appellants. Mildred V. DRAKE, Plaintiff, Appellee, v. RAYMARK INDUSTRIES, INC., et al., Defendants and Third-Party Plaintiffs, Appellees, Bath Iron Works Corporation, Third-Party Defendant, Appellant.
• Court: U.S. Court of Appeals — First Circuit

Page 1007

772 F.2d 1007

1986 A.M.C. 1965, Prod.Liab.Rep.(CCH)P 10,707

Mildred V. DRAKE, Plaintiff, Appellee, v. RAYMARK INDUSTRIES, INC., et al., Defendants and Third-Party

Plaintiffs, Appellants.

Mildred V. DRAKE, Plaintiff, Appellee, v. RAYMARK INDUSTRIES, INC., et al., Defendants and Third-Party

Plaintiffs, Appellees,

Bath Iron Works Corporation, Third-Party Defendant, Appellant.

Nos. 84-2033, 84-2034.

United States Court of Appeals First Circuit.

Argued April 3, 1985.

Decided Aug. 27, 1985.

Mark G. Furey, Portland, Me., with whom Thomas R. McNaboe, Thompson, McNaboe & Ashley, Bernstein, Shur, Sawyer & Nelson, Hunt, Thompson & Bowie, Verrill & Dana, Portland, Me., and Skelton, Taintor, Abbott & Orestis, Lewiston, Me., were on brief, for Raymark Industries, Inc.

Robert F. Hanson, Portland, Me., with whom James D. Poliquin and Norman & Hanson, Portland, Me., were on brief, for Bath Iron Works Corp.

Before CAMPBELL, Chief Judge, BOWNES and TORRUELLA, Circuit Judges.

BOWNES, Circuit Judge.

This is an appeal from a summary judgment granted third-party defendant-appellee Bath Iron Works Corporation (BIW or Shipyard) on claims against it for contribution or indemnity by defendants and third-party plaintiffs-appellants Raymark Industries, Inc. and other manufacturers and distributors of asbestos products.

I. BACKGROUND

This is one of approximately fifty cases brought in the District Court of Maine by present and former employees of BIW, or the representatives of their estates, against a large number of manufacturers and suppliers of asbestos products. BIW is in the shipbuilding and ship repair business. The complaints in the primary actions seek compensatory and punitive damages for injuries the employees of BIW allegedly sustained from exposure to appellants' products during the course of their employment at the Shipyard.

With the approval of the district court, the defendants-appellants filed a Model Third-Party Complaint against BIW in each of the actions against them. The case at bar tests the soundness of the district court's ruling on motion for summary judgment that none of the six counts of the Model Third-Party complaint could be maintained. We restate the allegations in the complaint seriatim.

Count I alleges that BIW knew or should have known that the material it purchased for use in the construction and/or repair of ships included asbestos and products containing asbestos, and that its employees would come into contact with such materials; that BIW knew or should have known that working with asbestos and products containing asbestos posed unreasonable health dangers unless adequate precautionary measures were taken; that BIW wantonly, recklessly and negligently failed to exercise due care vis-a-vis its employees in ten specific ways; that any damages to plaintiffs were caused by BIW; that any judgment against the defendants should be reduced by the amount of BIW's workers' compensation lien under the Longshoremen's and Harbor Workers' Compensation Act (LHWCA) or, in the alternative, the defendants are entitled to a judgment against BIW in the amount of such liens. Defendants also seek declaratory relief that BIW be ordered to pay directly to them any future workers' compensation benefits to which the plaintiffs became entitled.

Count II seeks contribution or indemnity for any punitive damage judgments for the plaintiffs.

Count III alleges that the construction of and/or repair of ships involving asbestos and products containing asbestos were inherently dangerous activities; that defendants had no control over the products sold once they were in the possession of BIW; that BIW owed defendants a duty, independent of any duty to its employees, not to use asbestos and products containing asbestos in such a willful, wanton, reckless or negligent manner as to make them unreasonably hazardous to BIW employees or other persons; that defendants' products were not dangerous to BIW employees if used with due care; that defendants are entitled to be indemnified by BIW to the full extent of any judgments against them or, in the alternative, to the extent of BIW's workers' compensation liens.

Count IV alleges a claim for contribution for any damages for consequential and punitive damages recovered by plaintiffs against defendants, including loss of consortium.

Count V alleges that BIW had a duty to provide medical examinations, diagnosis, and treatment for the illness of its employees; that BIW's medical personnel wantonly, recklessly and negligently failed to perform their duties; that such failure caused or aggravated the asbestos-related diseases of the employees; that defendants are entitled to contribution and indemnification by BIW for any judgments against them or, in the alternative, to indemnification to the extent of BIW's workers' compensation lien.

Count VI alleges that BIW was the owner or owner pro hac vice of the vessels upon which its employees worked within the meaning of 33 U.S.C. Sec. 902(21); that BIW acted willfully, wantonly, recklessly and negligently as owner or owner pro hac vice ; that BIW's conduct was the proximate cause of the damages claimed by plaintiffs; that under 33 U.S.C. Sec. 905(b), BIW is liable to plaintiffs for all damages claimed in their complaints against defendants.

With one exception, all of the claims for contribution and/or indemnity are based on alleged breaches of duty by BIW to its employees. The exception is paragraph 19 of Count III which states in pertinent part: "BIW owed defendants a duty, independent of any duty it owed its employees, not to employ" the asbestos materials so as to make them unreasonably dangerous to the employees or others. Defendants failed to state whether the alleged duty is based on tort or contract. Nor did they allege the existence of an express or implied contract between BIW and the defendants regarding the use of asbestos material. The defendants, then, "are asking us to hold a user liable to a manufacturer for the former's negligent use of the latter's defective product." Zapico v. Bucyrus-Erie Co., 579 F.2d 714, 723 (2d Cir.1978) (Friendly, J.). Like the Second Circuit, "[t]his we decline to do." Id. ; cf. 2A Larson, The Law of Workmen's Compensation Sec. 76.84 at 14-746 (1985) ("But when a purchaser buys a product, does he make an implied contract with the manufacturer to use the goods in such a way as not to bring liability upon the manufacturer? This would be stretching the concept of contract out of all relation to reality."). The district court did not expressly rule on this claim, probably because it was not pressed below. Certainly, the defendants have not adverted to it at all in their brief to this court. Given these circumstances, we consider this claim to have been dropped but, in any event, we rule that it must be dismissed for failure to state a cause of action upon which relief can be granted. The basis of liability for defendants' third-party action is, therefore, grounded solely on BIW's alleged breach of duties to its employees.

The district court rendered three separate opinions. On Counts I through V, which we shall refer to as the land-based or nonmaritime claims, the court granted summary judgment for BIW, excepting only those claims for pro tanto indemnification. 589 F.Supp. 1563 (D.Me.1984). The court based its ruling on the grounds that the exclusivity provision of the Maine Workers Compensation Act (MWCA), Me.Rev.Stat.Ann. tit. 39, Sec. 4 (1978 and Supp.1983-84), had been interpreted by the Maine Supreme Judicial Court to bar all noncontractual rights of contribution and indemnity. McKellar v. Clark Equipment Co., 472 A.2d 411, 416 (Me.1984); Roberts v. American Chain & Cable Co., Inc., 259 A.2d 43, 51 (Me.1969). In a subsequent opinion, the district court granted summary judgment for BIW on the pro tanto claims.

Because no benefits have been paid to Forrest Drake, his widow or his dependents under the Maine Workers' Compensation Act, and BIW and its insurer have waived any workers' compensation lien under the LHWCA, there is no predicate for the pro tanto relief sought by defendants against BIW in their third-party complaints.

On Count VI the district court held "that BIW was not during the relevant periods the owner pro hac vice of vessels being constructed or repaired in its yard and that the cause of action asserted in Count VI of R-M's third-party complaints is therefore barred by Section 905(a) of the LHWCA."

We shall review first the district court's disposition of Count VI, for contribution based on the alleged negligence of the BIW qua shipowner vis-a-vis the injured employees. We then evaluate the court's disposition of the land-based claims. Our ultimate conclusion is the same as the district court's--that none of the counts contained in the model third-party complaint can withstand a motion for summary judgment--although we reason to that conclusion via a different route.

II. THIRD-PARTY LIABILITY AS A SHIPOWNER UNDER Sec. 905(b)

In Count VI of their Model Third-Party Complaint, defendant manufacturers press a claim against Bath Iron Works for shipowner negligence, purportedly based on the Longshore and Harbor Workers' Compensation Act ¹ (LHWCA or Longshore Act), 33 U.S.C. Sec. 905(b). Defendants correctly claim that determinations regarding the viability of Sec. 905(b) negligence claims are governed by federal maritime principles. Jones & Laughlin Steel Corp. v. Pfeifer, 462 U.S. 523, 103 S.Ct. 2541, 76 L.Ed.2d 768 (1983); Scindia Steam Navigation Co. v. De Los Santos, 451 U.S. 156, at 165 n. 13, 101 S.Ct. 1614 at 1621 n. 13, 68 L.Ed.2d 1 (1981). Turning to the statute, the pertinent language reads as follows:

In the event of injury to a person covered under this chapter caused by the negligence of a vessel, then such person, or anyone otherwise entitled to recover damages by reason thereof, may bring an action against such vessel as a third party in accordance with...