Howey v. United States

Decision Date30 July 1973
Docket NumberNo. 71-2384.,71-2384.
Citation481 F.2d 1187
PartiesFrank HOWEY, Plaintiff-Appellee, v. UNITED STATES of America, Defendant and Third-Party Plaintiff-Appellant, v. RADIO CORPORATION OF AMERICA, Third-Party Defendant-Appellee, v. UNIVERSAL SERVICES, INC., Third-Party Defendant-Appellee.
CourtU.S. Court of Appeals — Ninth Circuit

Ronald R. Glancy (argued), Dept. of Justice, Civil Div., Washington, D.C., E. Grey Lewis, Acting Asst. Atty. Gen., G. Kent Edwards, U. S. Atty., Anchorage, Alaska, Morton Hollander, Kathryn J. Baldwin, Atty., Dept. of Justice, Civil Div., Washington, D.C. for appellant.

Richard O. Gantz (argued), of Hughes, Thorsness, Lowe, Gantz & Clark, Jesse C. Bell (argued), of Atkinson, Wade, Conway & Young, Anchorage, Alaska, for appellees.

Before LUMBARD,* BROWNING, and DUNIWAY, Circuit Judges.

LUMBARD, Circuit Judge:

Frank Howey sued the United States pursuant to the Federal Tort Claims Act in the United States District Court for Alaska. Judge James A. von der Heydt, sitting without a jury awarded him damages of $622,617.64. After the trial the government and Howey settled for $250,000. However, before the trial the government had filed third party complaints against Radio Corporation of America (RCA) and Universal Services, Inc. (Universal Services) for indemnification. On the second day of the trial, which commenced on November 2, 1971, and before any witnesses were called, the government moved for leave to amend its third party complaint against RCA. The motion was denied. After the trial the district court held that the government was not entitled to indemnification from Universal Services, or from RCA under the government's original third party complaint. The government appeals only from the adverse rulings concerning the third party defendants.

The accident giving rise to Howey's claim occurred on March 15, 1965 at a government owned communication facility in Aniak, Alaska. This site was part of the overall White Alice communications system operated throughout Alaska. There are about 40 sites similar to the one at Aniak. The facility had been constructed by a contractor pursuant to an Air Force contract, and accepted by the government in 1956. After accepting the site the government contracted with Federal Electric Corporation to operate the facility. Beginning in 1962 RCA began to operate White Alice sites pursuant to a contract with the government. At the time of the accident, RCA had between 400 and 500 employees operating the White Alice system. According to the contract between RCA and the government, RCA assumed the responsibility for the custody, operation, and maintenance of the communication sites. The government owned the sites, but the daily operational control of the premises was vested in RCA. RCA had entered into a subcontract with Universal Services, who agreed to supply personnel to RCA for the operation of the facility. Howey was one of those assigned by Universal Services to work for RCA.

Federal Aviation Administration regulations required the antenna towers at the Aniak facility to be illuminated by red lights. On March 14, 1965 the plaintiff was ordered by his supervisor, an RCA employee, to replace one of the antenna lights. The antenna tower was not properly constructed in that one climbing the tower to replace a light could not utilize adequate safety devices. A person ascending to the antenna lights was required to cross on a six inch angle iron beam without guide or guardrails. Because of this unsafe condition personnel in changing the lights used an alternative route by scaling the back of the antenna. On March 15, 1965, Howey after climbing the tower and attempting to change the light, slipped while descending and fell some ten feet, landing on a platform located below the antenna lights. The district judge found that Howey had suffered back injuries and contusions, and later developed a psychiatric reaction to the fall. He further concluded that this accident rendered him totally and permanently disabled from gainful employment.

Howey sued both the United States and RCA in separate actions. The plaintiff and RCA settled their dispute before the instant case against the government came to trial. In Howey's action against the United States, the latter filed third party complaints against RCA and Universal Services. The pertinent part of the third party complaint against RCA, filed on November 10, 1966, stated:

Defendant, UNITED STATES OF AMERICA, is entitled to recover from RADIO CORPORATION OF AMERICA, all or part of what Plaintiff FRANK W. HOWEY may recover from the UNITED STATES OF AMERICA in that RADIO CORPORATION OF AMERICA agreed in a maintenance contract with the UNITED STATES OF AMERICA to maintain comprehensive general liability (bodily injury) insurance to cover such injuries as alleged by Plaintiff.

On the second day of trial the government moved for leave to amend this third party complaint against RCA to allege specifically a claim for contractual and common law indemnity and/or contribution.1 Leave to amend was denied, and the district court limited its consideration of the government's rights against RCA to RCA's compliance with its contractual obligation to procure and maintain comprehensive liability insurance. On this claim the trial court found in favor of RCA.

The government's third party complaint against Universal Services was likewise dismissed. The government sought indemnity from Universal Services based on the following clause of the subcontract between RCA and Universal Services:

Subcontractor agrees to hold RCA and the Government safe and harmless from any and all claims of whatever nature which may arise as a result of Subcontractor performance hereunder, forever.

The first issue is whether the district court abused its discretion in refusing to permit the government to amend its third party complaint against RCA. In light of the strong policy to permit the amending of pleadings, we conclude that the district court did abuse its discretion.

The Supreme Court has instructed the lower federal courts to heed carefully the command of Rule 15(a), F.R. Civ.P., by freely granting leave to amend when justice so requires. Foman v. Davis, 371 U.S. 178, 83 S.Ct. 227, 9 L.Ed.2d 222 (1962); United States v. Hougham, 364 U.S. 310, 81 S.Ct. 13, 5 L. Ed.2d 8 (1960). The purpose of pleadings is "to facilitate a proper decision on the merits," Conley v. Gibson, 355 U.S. 41, 48, 78 S.Ct. 99, 103, 2 L.Ed.2d 80 (1957), and not to erect formal and burdensome impediments in the litigation process. Unless undue prejudice to the opposing party will result, a trial judge should ordinarily permit a party to amend its complaint. See United States v. Hougham, supra; Middle Atlantic Utilities Co. v. S.M.W. Development Corp., 392 F.2d 380 (2d Cir. 1968); Breier v. Northern California Bowling Proprietors' Ass'n., 316 F.2d 787 (9th Cir. 1963); 3 Moore's Federal Practice, § 15.08.

In sustaining RCA's objection to an amendment of the complaint, the district judge did not speak in terms of undue prejudice to RCA. Rather he simply observed that the motion to amend, coming several years after the case had been set down for trial, was not a timely filing of an amendment to a third party complaint. After the trial the judge denied the government's motion for a new trial and noted:

The Government was unable to establish any reason or excuse for its neglect in failing to bring a timely motion to amend its complaint. The amendment sought was one of considerable substance. The granting of defendant\'s motion to amend after commencement of trial would have severely prejudiced defendant RCA. It appeared impossible for RCA to prepare a defense during the course of the trial to the government\'s newly asserted claim. The only alternative available was to continue an overdue trial in progress, the witnesses and all parties in attendance.

Several factors are usually used as criteria to determine the propriety of a motion for leave to amend. These criteria include undue delay, bad faith, futility of amendment, and prejudice to the opposing party. While all these factors are relevant, the crucial factor is the resulting prejudice to the opposing party.

The government's motion to amend should have been granted as there was no showing that RCA would have been prejudiced thereby. While it is true that the motion was made five years after the third party complaint had been filed, we know of no case where delay alone was deemed sufficient grounds to deny a Rule 15(a) motion to amend.2 Where there is a lack of prejudice to the opposing party and the amended complaint is obviously not frivolous, or made as a dilatory maneuver in bad faith, it is an abuse of discretion to deny such a motion. The purpose of the litigation process is to vindicate meritorious claims. Refusing, solely because of delay, to permit an amendment to a pleading in order to state a potentially valid claim would hinder this purpose while not promoting any other sound judicial policy. Only where prejudice is shown or the movant acts in bad faith are courts protecting the judicial system or other litigants when they deny leave to amend a pleading.

Here the trial judge did not find, and there is no allegation that the government's motion was made in bad faith even though the government gave no reason for its lengthy delay. We discern from the record that the district judge placed great weight on delay as a factor in his decision, and placed upon the government the burden of establishing a reason for the delay. We agree with the Second and Eighth Circuits that the mere fact that the government could have moved at an earlier time to amend does not by itself constitute an adequate basis for denying leave to amend. See Hanson v. Hunt Oil Co., 398 F.2d 578 (8th Cir. 1968); Middle Atlantic Utilities Co. v. S.C.W. Development Corp., 392 F.2d 380 (2nd Cir. 1968).3

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