Glover v. Johns-Manville Corp.

• Decision Date: 05 October 1981
• Docket Number: JOHNS-MANVILLE,No. 80-1085,80-1085
• Citation: 662 F.2d 225
• Parties: William B. GLOVER, Weeks Smith, William L. Bazemore, Plaintiffs, v.CORPORATION, a Delaware Corporation; Johns-Manville Sales Corporation, successor by merger with Johns-Manville Products Corporation, a Delaware Corporation; Unarco Industries, Inc., formerly known as Union Asbestos and Rubber Company, a Delaware Corporation; H. K. Porter Company, Inc., Thermoid Division, a Delaware Corporation; Southern Textile Company, a Delaware Corporation; Raybestos-Manhattan, Inc., a Connecticut Corporation; Owens-Corning Fiberglas Corporation, a Delaware Corporation, the Celotex Corporation, a Delaware Corporation, Appellants, and PITTSBURGH CORNING CORPORATION, a Delaware Corporation; J. P. Stevens& Company, Inc., a Delaware Corporation; Eagle-Picher Industries, Inc., an Ohio Corporation; Amatex Corporation, a Pennsylvania Corporation, GAF Corporation, a Delaware Corporation, Defendants and Third Party Plaintiffs, v. UNITED STATES of America, Appellee.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 225

662 F.2d 225

William B. GLOVER, Weeks Smith, William L. Bazemore, Plaintiffs, v. JOHNS-MANVILLE CORPORATION, a Delaware Corporation;

Johns-Manville Sales Corporation, successor by merger with

Johns-Manville Products Corporation, a Delaware Corporation;

Unarco Industries, Inc., formerly known as Union Asbestos

and Rubber Company, a Delaware Corporation; H. K. Porter

Company, Inc., Thermoid Division, a Delaware Corporation;

Southern Textile Company, a Delaware Corporation;

Raybestos-Manhattan, Inc., a Connecticut Corporation;

Owens-Corning Fiberglas Corporation, a Delaware Corporation,

the Celotex Corporation, a Delaware Corporation, Appellants,

and

PITTSBURGH CORNING CORPORATION, a Delaware Corporation; J.

P. Stevens& Company, Inc., a Delaware Corporation;

Eagle-Picher Industries, Inc., an Ohio Corporation; Amatex

Corporation, a Pennsylvania Corporation, GAF Corporation, a Delaware Corporation, Defendants and Third Party Plaintiffs, v. UNITED STATES of America, Appellee.

No. 80-1085.

United States Court of Appeals Fourth Circuit.

Argued Nov. 11, 1980.

Decided Oct. 5, 1981.

C. Michael Montgomery, Norfolk, Va. (Steven G. Schwartz, Seawell, McCoy, Dalton, Hughes, Gore & Timms, Norfolk, Va., on brief), for Johns-Manville Corp. and Johns-Manville Sales Corp.

Philip Payne, Newport News, Va. (Hoyle, Corbett, Hubbard, Smith & Payne, Newport News, Va., Pitney, Hardin & Kipp, Morristown, N.J., on brief), for Raybestos-Manhattan, Inc.

Gerard E. W. Voyer, Taylor, Walker & Adams, Norfolk, Va., on brief for Unarco Industries, Inc.

Archibald Wallace, III, Albert D. Bugg, Jr., Sands, Anderson, Marks & Miller, Richmond, Va., on brief for H. K. Porter Co., Inc. and Southern Textile Company.

Jack E. Greer, Williams, Worrell, Kelly & Greer, Norfolk, Va., on brief for Owens-Corning Fiberglas Corp.

John Y. Pearson, Jr., Willcox, Savage, Lawrence, Dickson & Spindle, Norfolk, Va., on brief for Celotex Corp.

Joseph B. Cox, Jr., Chapel Hill, N.C. (Alice Daniel, Asst. Atty. Gen., Washington, D.C., Justin W. Williams, U.S. Atty., Alexandria, Va., Neil R. Peterson, Civ. Div., Dept. of Justice, Washington, D.C., on brief), for appellee.

Before WIDENER, HALL and PHILLIPS, Circuit Judges.

WIDENER, Circuit Judge:

The appeal at hand arises from an action for indemnity brought against the United States by the Johns-Manville Corporation and fourteen other manufacturers of asbestos-based insulation products (the manufacturers). The district court dismissed the two contractual counts of the manufacturers' complaint for lack of subject matter jurisdiction, and, after a full trial, held as a matter of both law and fact that the manufacturers were not entitled to recover on their remaining claim for noncontractual indemnity. ¹ We affirm the decision on noncontractual indemnity, but vacate and remand the decision on the contractual claims.

This controversy traces its origins to an action instituted by William Glover against the manufacturers in the United States District Court for the Eastern District of Virginia. Glover, a civilian, was employed from 1940 until his retirement in 1975 by the Norfolk Naval Shipyard, a facility owned and operated by the United States. His retirement was precipitated by the onset of the industrial disease of asbestosis, which Glover claimed to have contracted as a result of his job related handling of and exposure to the asbestos-based insulation materials produced and sold by the manufacturers.

After successfully asserting a claim against the United States for workmen's compensation benefits under the Federal Employees' Compensation Act (FECA), 5 U.S.C. § 8101 et seq., Glover initiated an action against the manufacturers. His claim for relief was based upon the principles of negligence, implied warranty, strict liability, and fraudulently misrepresenting and withholding information about the product. ²

Prior to settlement, however, the manufacturers filed the instant third party action against the United States for indemnity should they be found liable to Glover in the principal case. As amended, their complaint alleged subject matter jurisdiction under the Federal Tort Claims Act, 28 U.S.C. §§ 1346(b), 2671 et seq., or, in the alternative, under the general admiralty and maritime law of the United States, 28 U.S.C. § 1333, the Suits in Admiralty Act, 46 U.S.C. § 741 et seq., and the Public Vessels Act, 46 U.S.C. § 781 et seq. It also asserted that the district court had pendent and ancillary jurisdiction over the indemnity action. By its prior order in the consolidated proceeding, the district court had denied the presence of all admiralty and related statutory jurisdiction; therefore, this case proceeded as one under the Tort Claims Act.

The third party complaint asserted that the United States was liable to the manufacturers on the theories of noncontractual indemnity as between active and passive tort-feasors, breach of an implied warranty, and the United States' alleged breach of its employment contract with Glover, with respect to which the manufacturers claimed to be third party beneficiaries. On the motion of the United States, the district court dismissed the latter two contractual counts for lack of jurisdiction. Thus, only the noncontractual indemnity claim remained to be tried.

At trial the United States relied upon the defense that its sole liability for injury to one of its employees arose under the FECA. Because it had paid, and apparently continued to pay, such compensation to Glover, the United States contended that § 8116(c) of the FECA precluded further recovery against it by the manufacturers. 5 U.S.C. § 8116(c). The manufacturers, on the other hand, asserted that the exclusive remedy provision of § 8116(c) did not apply to bar claims of third parties such as themselves, who are unrelated to the injured party, under the doctrine announced in Wallenius Bremen G.m.b.H. v. United States, 409 F.2d 994 (4th Cir. 1969), cert. denied, 398 U.S. 958, 90 S.Ct. 2164, 26 L.Ed.2d 542 (1970).

The district court noted that, while, pursuant to Bremen, the claim of the manufacturers might not be directly barred by the exclusive remedy provisions of the FECA, the Act did bar any action by Glover against the United States. Applying Virginia law, ³ the court held that the action for noncontractual indemnity would not lie because the indemnitor and the indemnitee were not jointly liable to the injured party. Furthermore, the court held that even if such a defense were unavailing, the claim failed on its merits because the manufacturers' negligence was active rather than passive.

The manufacturers appeal from these holdings on various grounds. As to the district court's denial of recovery under the noncontractual indemnity claim, they assert that it was error to apply the law of Virginia in limitation of the FECA, and that the court further erred in finding the manufacturers' fault to have been active rather than passive. The manufacturers also appeal from the dismissal for lack of jurisdiction of the two contractual indemnity counts.

We address ourselves first to the issues surrounding the noncontractual indemnity claim. The parties have expended a large portion of their arguments on appeal on the question of the propriety of the rule, set forth in Bremen, that third parties unrelated to an injured employee are beyond the scope of the FECA exclusivity clause. For the purpose of this opinion, we will assume without deciding that § 8116(c) of the FECA is inapplicable to this action, and only comment that there is no merit to the United States' contention that Weyerhaeuser S.S. Co. v. United States, 372 U.S. 597, 83 S.Ct. 926, 10 L.Ed.2d 1 (1963), upon which Bremen relied, was overruled by United States v. Reliable Transfer Co., 421 U.S. 397, 95 S.Ct. 1708, 44 L.Ed.2d 251 (1975).

Many of the remaining issues presented with respect to the noncontractual indemnity claim are largely settled by our opinion in the companion case of White v. Johns-Manville Corporation, 662 F.2d 243, Nos. 80-1116/1117/1118 (4th Cir. 1981) (hereinafter White I ). As in the present case, the original plaintiffs in White were shipyard workers who filed suit against the manufacturers after contracting asbestosis. Their action was based upon the manufacturers' alleged breach of a duty to warn and of an implied warranty, and upon the manufacturers' strict liability for their asbestos-based products. The manufacturers filed a third party action seeking indemnity from the plaintiffs' employer, the Newport News Shipyard, alleging, inter alia, that the manufacturers' fault was merely passive while that of the employer was active in nature. The district court granted Newport News' motion to dismiss the indemnity claims.

We note that we hold, in White v. Johns-Manville Corporation, 662 F.2d 234, Nos. 79-1854, 80-1028/1140/1154/1227/1228 (4th Cir. 1981) (White II ), that the manufacturers' noncontractual indemnity claim was derived from a maritime tort action and thus was subject to analysis under the federal maritime law. That law in White I was found to provide noncontractual indemnity in favor of a wrongdoer only where the indemnitee's liability is merely passive; such as constructive, vicarious or derivative, while the indemnitor's liability is active, flowing directly from its own act or omission. Because the liability for which the manufacturers sought to be indemnified could only arise from the allegations of the original complaint against them, and because that complaint alleged only active conduct, we held that noncontractual indemnity was unavailable as a matter of law.

That reasoning is equally applicable here. ⁴ Glover's original complaint asserted that the manufacturers were liable for their negligent failure to warn of the dangers inherent in the use of their asbestos-based products; for their alleged breach of an implied warranty that such products were reasonably fit for their intended use; in strict...