Spadola v. Viking Yacht Co.

• Citation: 441 F. Supp. 798
• Decision Date: 06 December 1977
• Docket Number: No. 77 Civ. 1684.,77 Civ. 1684.
• Parties: Vincent SPADOLA, Plaintiff, v. VIKING YACHT COMPANY, Defendant and Third-Party Plaintiff, v. JOHN W. McGRATH CORPORATION and Costa Line, Third-Party Defendants.
• Court: U.S. District Court — Southern District of New York

441 F. Supp. 798

Vincent SPADOLA, Plaintiff, v. VIKING YACHT COMPANY, Defendant and Third-Party Plaintiff, v. JOHN W. McGRATH CORPORATION and Costa Line, Third-Party Defendants.

No. 77 Civ. 1684.

United States District Court, S. D. New York.

December 6, 1977.

Paul A. Gritz, Brooklyn, N.Y. (Martin L. Katz, Brooklyn, N.Y., of counsel), for plaintiff.

Sherwin Rear, Brooklyn, N.Y., Simon & White, New York City, for defendant and third-party plaintiff Viking.

Michael D. Martocci, New York City (Philip S. LaPenta, New York City, of counsel), for third-party defendant Costa Line.

James M. Leonard, McHugh, Heckman, Smith & Leonard, New York City, for third-party defendant, John W. McGrath Corp.

MEMORANDUM AND ORDER

BRIEANT, District Judge.

Plaintiff Vincent Spadola is a citizen and resident of New York. Defendant Viking Yacht Company is alleged to be a "domestic corporation," (Complaint, ¶ SECOND) having "a place of doing business at Route 9 and Bass River, New Gretna, New York" (Complaint, ¶ THIRD). Apparently, in fact it is a New Jersey corporation. By paragraph TENTH of the original complaint filed April 3, 1977, subject matter jurisdiction is said to be founded on 28 U.S.C. § 1332 (diversity) and § 1333 (admiralty and maritime).

The facts, for purposes of this motion, are not in dispute. Plaintiff is a longshoreman, who was, on May 2, 1975, employed at Pier 9, Brooklyn, New York by third-party defendant John W. McGrath Corporation ("McGrath"). McGrath was a stevedore retained at that time and place to load cargo aboard a vessel owned by third-party defendant Costa Line.

Part of the cargo being lifted by the Costa Line vessel through the services of McGrath as stevedore and Spadola as longshoreman, was a yacht. The yacht is not a "vessel" for purposes of this litigation, and in our treatment of the case we regard it no differently than a container filled with miscellaneous goods, a locomotive, or crate, box or bale of any kind of dry cargo. The defendant Viking Yacht Company ("Viking Yacht"), owner of the yacht, was a consignor or shipper of ocean freight. It had tendered the yacht to the Costa Line vessel for transportation as freight in foreign ocean commerce. To do this, Viking Yacht caused the yacht to be transported to the pier on its flat-bed truck, operated by its employee.

While Viking's motor truck was standing on the pier next to the Costa Line vessel, and while the Costa Line vessel's stevedore, McGrath, was engaged in lifting the yacht aboard its vessel to be carried as deck cargo, and while plaintiff Spadola was assisting in that stevedoring operation, Viking's truck was caused to move due to the claimed negligence of the driver of the truck, Viking's employee or authorized operator. In the words of Paragraph SIXTH of the complaint, as amended, plaintiff alleges that "due to the negligence of the driver of said truck, plaintiff was caused to sustain severe and permanent injuries, through no fault on his part, but solely as a result of the negligence of Viking Yacht's employee." The truck ran over his foot.

It will be seen that the accident happened in the context of a stevedoring operation. Accordingly, Spadola has been or will be paid the Workmen's Compensation benefits required by the Longshoremen's & Harbor Workers' Compensation Act (LHWCA). That compensation was paid for by his employer, McGrath.

Insofar as concerns McGrath, the third-party complaint filed September 2, 1977 seeks indemnification or contribution. McGrath has now moved, pursuant to Rule 12(b), F.R.Civ.P., to dismiss on the ground that such action is "barred by § 905(b) of the LHWCA."

Clearly, this action arises out of a maritime tort, occurring on the pier or stringpiece, next to the vessel, in the course of a stevedoring operation. This is not an automobile accident case or a pedestrian knockdown. Federal law will apply. See 33 U.S.C. § 903(a).

Accordingly, we turn first to the claim for contribution alternatively pleaded against McGrath. It has been clear at least since Halcyon Lines v. Haenn Ship Ceiling & Refitting Corp., 342 U.S. 282, 285, 72 S.Ct. 277, 96 L.Ed. 318 (1952) that there is no contribution among joint tortfeasors in the context of a maritime personal injury case, where the tortfeasor against whom the contribution is sought has paid compensation under the LHWCA. The Halcyon rule survived the 1972 amendments to the LWHCA, which do not deal with the issue. That Halcyon "was, and still is, good law on its facts" is the express holding in Cooper Stevedoring Co., Inc. v. Fritz Kopke Inc., 417 U.S. 106, 115, 94 S.Ct. 2174, 2179, 40 L.Ed.2d 694 (1974). In Cooper Stevedoring, the Supreme Court explained that in Halcyon no contribution could be required of Haenn because Haenn was the employer of the injured plaintiff, who had furnished compensation under the LHWCA. In Cooper Stevedoring the joint tortfeasor was not an employer. Accordingly, since the plaintiff could have sued the joint tortfeasor directly, and was not barred therefrom by the LHWCA, contribution was proper.

To the extent contribution is sought, the third-party complaint fails to state a claim against McGrath.

We turn now to the question of indemnity. Although Viking Yacht's pleading is unclear, apparently no express contract of indemnity exists between McGrath and the numerous consignors of freight. Presumably Viking Yacht relies on an implied warranty of workmanlike service given to the Costa Line vessel, recognized in Ryan Stevedoring Co. v. Pan-Atlantic Steamship Corp., 350 U.S. 124, 76 S.Ct. 232, 100 L.Ed. 133 (1956), and its progeny, of which all injured persons on the vessel or pier are either "third-party beneficiaries," or able to sue absent any privity, or intention on the part of Costa or McGrath that they benefit thereby.

This leads us directly to the construction to be placed upon the 1972 amendment to § 5(b) of the LHWCA 33 U.S.C. § 905(b). That amendment reads in relevant part 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 the provisions of section 933 of this title and the employer shall not be liable to the vessel for such damages directly or indirectly and any agreements or warranties to the contrary shall be void. If such person was employed by the vessel to provide stevedoring services, no such action shall be permitted if the injury was caused by the negligence of persons engaged in providing stevedoring services to the vessel. If such person was employed by the vessel to provide ship building or repair services, no such action shall be permitted if the injury was caused by the negligence of persons engaged in providing ship building or repair services to the vessel. The liability of the vessel under this subsection shall not be based upon the warranty of seaworthiness or a breach thereof at the time the injury occurred. The remedy provided in this subsection shall be exclusive of all other remedies against the vessel except remedies available under this chapter." (Underlining added.)

Must the references in that remedial statute to "vessel" and vessel owner be read literally? Or should we read the statute in light of the evil it sought to remedy? The statutory purpose was expressed by the Court of Appeals in Munoz v. Flota Mercante Grancolombiana, S.A., 553 F.2d 837, 840 (2d Cir. 1977):

"The amended Act is a paradigm of political compromise. Injured workers would enjoy significant improvement in the level of benefits. The stevedore-employer, now rid of the yoke of indemnification suits, would be induced to insure employee safety by increased compensation awards. Shipowners no longer could be held under the rubric of unseaworthiness — a euphemism for absolute liability — for injuries suffered onboard the ship by harbor workers."

Here, the old circuity of action based on indemnification and sought to be stamped out by the 1972 amendment, is said to remain available simply because, in the context of this stevedoring operation, the action for negligence is not against a "vessel," but rather against a motor truck, its owner and operator. Defendant and third-party plaintiff, Viking Yacht relies on Gould v. General Mills, Inc., 411 F.Supp. 1181 (W.D. N.Y.1976) and Brkaric v. Star Iron and Steel Co., 409 F.Supp. 516, 520 (E.D.N.Y. 1976), and Zapico v. Bucyrus-Erie Co., 434 F.Supp. 567 (S.D.N.Y.1977).

We begin with the initial observation that we must focus on the evil which the 1972 reform legislation was intended to stamp out.

The disruptive effect of third party suits on the compensation scheme provided by the Act is described with clarity in Lucas v. "Brinknes" Schiffahrts Ges., 379 F.Supp. 759, 767 (E.D.Pa.1974). There, Judge Huyett held:

"It was understood by the members of Congress most directly involved in amending the Act that in allowing for any third-party suits Congress ran the risk that liability would eventually be visited on the employer. It was deemed essential that clear amending language be used to prevent such an occurrence. The process by which a consensus was reached to allow for a third-party suit against the vessel for its negligence illustrates Congress' paramount concern that the employer's liability under the Act to his employee must be

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