O'Shea v. Riverway Towing Co.

• Decision Date: 27 April 1982
• Docket Number: No. 81-1924,81-1924
• Parties: Margaret O'SHEA, Plaintiff-Appellee, v. RIVERWAY TOWING COMPANY, Defendant-Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 1194

677 F.2d 1194

Margaret O'SHEA, Plaintiff-Appellee, v. RIVERWAY TOWING COMPANY, Defendant-Appellant.

No. 81-1924.

United States Court of Appeals Seventh Circuit.

Argued April 1, 1982.

Decided April 27, 1982.

Grey Chatham, Cook, Shevlin & Keefe, Belleville, Ill., for plaintiff-appellee.

Gary Mayes, St. Louis, Mo., for defendant-appellant.

Before ESCHBACH, Circuit Judge, NICHOLS, Associate Judge, ^* and POSNER, Circuit Judge.

POSNER, Circuit Judge.

This is a tort case under the federal admiralty jurisdiction. We are called upon to decide questions of contributory negligence and damage assessment, in particular the question-one of first impression in this circuit-whether, and if so how, to account for inflation in computing lost future wages.

On the day of the accident, Margaret O'Shea was coming off duty as a cook on a towboat plying the Mississippi River. A harbor boat operated by the defendant, Riverway Towing Company, carried Mrs. O'Shea to shore and while getting off the boat she fell and sustained the injury complained of. The district judge found Riverway negligent and Mrs. O'Shea free from contributory negligence, and assessed damages in excess of $150,000. Riverway appeals only from the finding that there was no contributory negligence and from the part of the damage award that was intended to compensate Mrs. O'Shea for her lost future wages.

The accident happened in the following way. When the harbor boat reached shore it tied up to a seawall the top of which was several feet above the boat's deck. There was no ladder. The other passengers, who were seamen, clambered up the seawall without difficulty, but Mrs. O'Shea, a 57-year-old woman who weighs 200 pounds (she is five foot seven), balked. According to Mrs. O'Shea's testimony, which the district court believed, a deckhand instructed her to climb the stairs to a catwalk above the deck and disembark from there. But the catwalk was three feet above the top of the seawall, and again there was no ladder. The deckhand told her that she should jump and that the men who had already disembarked would help her land safely. She did as told, but fell in landing, carrying the assisting seamen down with her, and broke her leg.

Riverway concedes that the instruction to Mrs. O'Shea to jump was negligent, but argues that she was contributorily negligent to jump down the three feet to the seawall, given her age and weight, and therefore that her damages should have been reduced. But if her testimony is believed-and Riverway does not ask us to redetermine any issue of credibility-the finding that she was not contributorily negligent cannot be said to be clearly erroneous. There she was on the boat with no apparent way to get off. The deckhand told her to jump and that the men already on the shore would make sure she landed safely. It was reasonable for her to assume that Riverway knew how to disembark passengers, even overweight middle-aged female passengers, safely in the absence of a ladder (with which the boat curiously was not equipped). The deckhand's apparent expertise made the risks as they reasonably appeared to Mrs. O'Shea small relative to the inconvenience of remaining aboard indefinitely, at some cost in embarrassment as well as time, while the crew rigged some alternative method of exit tailored to her lack of agility.

The more substantial issues in this appeal relate to the computation of lost wages. Mrs. O'Shea's job as a cook paid her $40 a day, and since the custom was to work 30 days consecutively and then have the next 30 days off, this comes to $7200 a year although, as we shall see, she never had earned that much in a single year. She testified that when the accident occurred she had been about to get another cook's job on a Mississippi towboat that would have paid her $60 a day ($10,800 a year). She also testified that she had been intending to work as a boat's cook until she was 70-longer if she was able. An economist who testified on Mrs. O'Shea's behalf used the foregoing testimony as the basis for estimating the wages that she lost because of the accident. He first subtracted federal income tax from yearly wage estimates based on alternative assumptions about her wage rate (that it would be either $40 or $60 a day); assumed that this wage would have grown by between six and eight percent a year; assumed that she would have worked either to age 65 or to age 70; and then discounted the resulting lost-wage estimates to present value, using a discount rate of 8.5 percent a year. These calculations, being based on alternative assumptions concerning starting wage rate, annual wage increases, and length of employment, yielded a range of values rather than a single value. The bottom of the range was $50,000. This is the present value, computed at an 8.5 percent discount rate, of Mrs. O'Shea's lost future wages on the assumption that her starting wage was $40 a day and that it would have grown by six percent a year until she retired at the age of 65. The top of the range was $114,000, which is the present value (again discounted at 8.5 percent) of her lost future wages assuming she would have worked till she was 70 at a wage that would have started at $60 a day and increased by eight percent a year. The judge awarded a figure-$86,033-near the midpoint of this range. He did not explain in his written opinion how he had arrived at this figure, but in a preceding oral opinion he stated that he was "not certain that she would work until age 70 at this type of work," although "she certainly was entitled to" do so and "could have earned something"; and that he had not "felt bound by (the economist's) figure of eight per cent increase in wages" and had "not found the wages based on necessarily a 60 dollar a day job." If this can be taken to mean that he thought Mrs. O'Shea would probably have worked till she was 70, starting at $40 a day but moving up from there at six rather than eight percent a year, the economist's estimate of the present value of her lost future wages would be $75,000.

There is no doubt that the accident disabled Mrs. O'Shea from working as a cook on a boat. The break in her leg was very serious: it reduced the stability of the leg and caused her to fall frequently. It is impossible to see how she could have continued working as a cook, a job performed mostly while standing up, and especially on a boat, with its unsteady motion. But Riverway argues that Mrs. O'Shea (who has not worked at all since the accident, which occurred two years before the trial) could have gotten some sort of job and that the wages in that job should be deducted from the admittedly higher wages that she could have earned as a cook on a boat.

The question is not whether Mrs. O'Shea is totally disabled in the sense, relevant to social security disability cases but not tort cases, that there is no job in the American economy for which she is medically fit. Compare Cummins v. Schweiker, 670 F.2d 81 (7th Cir. 1982), with New Orleans (Gulfwide) Stevedores v. Turner, 661 F.2d 1031, 1037-38 (5th Cir. 1981). It is whether she can by reasonable diligence find gainful employment, given the physical condition in which the accident left her. See, e.g., Baker v. Baltimore & Ohio R. R., 502 F.2d 638, 644 (6th Cir. 1974). Here is a middle-aged woman, very overweight, badly scarred on one arm and one leg, unsteady on her feet, in constant and serious pain from the accident, with no education beyond high school and no work skills other than cooking, a job that happens to require standing for long periods which she is incapable of doing. It seems unlikely that someone in this condition could find gainful work at the minimum wage. True, the probability is not zero; and a better procedure, therefore, might have been to subtract from Mrs. O'Shea's lost future wages as a boat's cook the wages in some other job, discounted (i.e., multiplied) by the probability-very low-that she would in fact be able to get another job. But the district judge cannot be criticized for having failed to use a procedure not suggested by either party. The question put to him was the dichotomous one, would she or would she not get another job if she made reasonable efforts to do so? This required him to decide whether there was a more than 50 percent probability that she would. We cannot say that the negative answer he gave to that question was clearly erroneous.

Riverway argues next that it was wrong for the judge to award damages on the basis of a wage not validated, as it were, by at least a year's employment at that wage. Mrs. O'Shea had never worked full time, had never in fact earned more than $3600 in a full year, and in the year preceding the accident had earned only $900. But previous wages do not put a cap on an award of lost future wages. If a man who had never worked in his life graduated from law school, began working at a law firm at an annual salary of $35,000, and was killed the second day on the job, his lack of a past wage history would be irrelevant to computing his lost future wages. The present case is similar if less dramatic. Mrs. O'Shea did not work at all until 1974, when her husband died. She then lived on her inheritance and worked at a variety of part-time jobs till January 1979, when she started working as a cook on the towboat. According to her testimony, which the trial judge believed, she was then working full time. It is immaterial that this was her first full-time job and that the accident occurred before she had held it for a full year. Her job history was typical of women who return to the labor force after their children are grown or, as in Mrs. O'Shea's case, after their husband dies, and these women are, like any tort victims, entitled to damages based on what they would have earned in the future rather than on what they may or may not have earned in the past.

If we are correct so far, Mrs. O'Shea was entitled to have her lost wages...