Strachan Shipping Co. v. Davis

• Citation: 571 F.2d 968
• Decision Date: 24 April 1978
• Docket Number: No. 77-1555,77-1555
• Parties: STRACHAN SHIPPING COMPANY and American Mutual Insurance Company, Petitioners, v. Willie M. DAVIS and Director, Office of Workers' Compensation Programs, United States Department of Labor, Respondents.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 968

571 F.2d 968

STRACHAN SHIPPING COMPANY and American Mutual Insurance

Company, Petitioners, v. Willie M. DAVIS and Director, Office of Workers'

Compensation Programs, United States Department of

Labor, Respondents.

No. 77-1555.

United States Court of Appeals, Fifth Circuit.

April 24, 1978.

W. Boyd Reeves, Mobile, Ala., for petitioners.

Peter J. Palughi, Mobile, Ala., Ronald E. Meisburg, U. S. Dept. of Labor, Washington, D. C., Carin Ann Clauss, Sol. of Labor, Cornelius S. Donoghue, Jr., Assoc. Sol., U. S. Dept. of Labor, Washington, D. C., for respondents.

Petition for Review of An Order of the Benefits Review Board.

Before COLEMAN and FAY, Circuit Judges, and KING, District Judge. ^*

FAY, Circuit Judge:

The appellants herein seek to set aside orders of the Benefits Review Board awarding recovery to Willie Davis under the Longshoremen's and Harbor Workers' Compensation Act, 33 U.S.C. §§ 901, et seq. (hereinafter referred to as the Act). Davis was a bulk cargo gang foreman for Strachan Shipping Company for approximately thirty years, much of which was spent unloading "dust boats" containing dust producing cargo such as coal, iron ore, manganese ore, and coke.

Davis did not return to work subsequent to December, 1968, due to illness, and he contends that he was first informed that his illness was the result of work-related exposure to dust in August of 1969. ¹ There is much dispute concerning the degree of knowledge possessed by Strachan Shipping Company in August, 1969, but Davis did not file his claim until August, 1971, and notice of the claim was not received by Strachan until September 14, 1971.

Under the Act, an employee claiming compensation must comply with two separate limitation periods and failure to comply with either will defeat recovery. The employee must give written notice to the employer and to the deputy commissioner within thirty days after the employee knew, or reasonably should have known, that his illness is work-related. 33 U.S.C. § 912(a), (b). ² The employee's claim will also be barred unless a claim is filed within one year after the employee knew, or reasonably should have known, of the relationship between the illness and the employment. 33 U.S.C. § 913(a). ³

The Act also sets forth exceptions to each of the time limitations. Failure to comply with the thirty day notice provision will be excused if (1) the employer (or his agent in charge) or the carrier had knowledge of the illness and the employer has not been prejudiced by the lack of written notice, or (2) if a satisfactory excuse exists for failure to give written notice, or if the employer fails to object at the first hearing of a claim for compensation. 33 U.S.C. § 912(d). ⁴ The one-year limitation for filing a claim will not bar recovery if the employer or carrier has knowledge of the illness and fails to file the report required by 33 U.S.C. § 930(a). Under such circumstances, subdivision 930(f) ⁵ tolls the running of the one year limitation period until the report is filed.

After a formal hearing held on September 26, 1974, the administrative law judge held that Davis' claim was time-barred for failure to comply with sections 912 and 913. The administrative law judge implicitly held that "knowledge" of an illness within the meaning of subdivisions 912(d) and 930(f) refers to knowledge of an illness which is or is claimed to be job-related. The judge weighed the conflicting testimony and concluded that "the whole record indicates that the Employer and Carrier had no knowledge or notice of the claimed occupational disease prior to the filing of the claim in August, 1971." It is conceded, however, that the employer, through dock superintendent Waldron, had knowledge that Davis was ill and could not return to work as early as August, 1969.

On appeal from the decision of the administrative law judge, the Benefits Review Board held that knowledge that the illness is job-related is not a prerequisite to the application of the exceptions found in subdivisions 912(d) and 930(f). The Board held that all the employer need know is that the employee is suffering from an illness. The Board found that the record contained substantial evidence to support a finding that the employer did have knowledge shortly after Davis left his job that he would not be returning to work due to illness. The Board concluded that such knowledge was sufficient to trigger the notice requirement for the employer under subdivision 930(a), and, the employer having failed to file at the time Davis filed his claim, the only issues to be considered on remand were whether failure to give written notice of the illness as required by subdivision 912(a) is excusable pursuant to subdivision 912(d), and if so, for full consideration on the merits. After proceedings on remand before a different administrative law judge, and appeals therefrom, the claimant was awarded compensation.

The exceptions found in subdivisions 912(d) and 930(f) to the thirty day and one year limitation periods both require "knowledge" of the illness before tolling can occur. The parties to this appeal meet head-on as to the meaning of "knowledge" of an illness as used in the Act. The appellants, Strachan Shipping Company and American Mutual Insurance Company, contend that knowledge means awareness of an injury or illness which is, or is claimed to be, job-related, and place much emphasis upon the holding of the Third Circuit in Sun Shipbuilding & Dry Dock Company v. Bowman, 507 F.2d 146 (3rd Cir. 1975). They assert that if the Act is construed otherwise, employers will be unduly burdened and will have to conduct an investigation and file a report with the Department of Labor each time an employee calls in sick. Furthermore, the appellants argue that a contrary holding will have the practical effect of creating periods of extension rather than limitations.

Conversely, the appellees assert that the employer or carrier need only know of the existence of an illness, and need not know of the relationship to employment in order to satisfy the knowledge requirement of subdivisions 912(d) and 930(f). The appellees premise their interpretation on several distinct theories. They first contend that subdivisions 912(d) and 930(f) expressly refer only to knowledge of an illness and that the court should not read the qualification of job-relatedness into the Act. They further contend that whether an illness is job-related is often the ultimate issue in dispute, and that requiring knowledge of the job-related nature of the illness will have the practical effect of discouraging investigation and the filing of employer reports of illness as required by subdivision 930(f). Finally, the appellees argue that interpreting "knowledge" to mean awareness of the job-related nature of the illness will seriously dilute the significance of subdivision 912(a) written notice and will render nugatory the prejudice factor of subdivision 912(d).

We have reviewed the record and the contentions of the parties and have concluded that the Benefits Review Board erred in holding that the employer need only be aware of the existence of the illness, and need not be aware of its relationship to employment. Finding the decision of the first administrative law judge supported by substantial evidence, we set aside the decision and order of the Board and reinstate the decision of the administrative law judge denying compensation to the claimant. ⁶

In Sun Shipbuilding & Dry Dock Co. v. Bowman, ⁷ the Third Circuit held that the "knowledge" required by subdivisions 912(d) and 930(f) is knowledge of a job-related injury. The Court stated in pertinent part:

It is obvious that the knowledge requirements in sections 912(d) and 930(f) must refer to knowledge on the part of an employer of an injury sustained or an ailment incurred as a result of working conditions for which the employer is responsible. Such knowledge must relate to the person injured, as well as to an injury arising from the employment. We cannot infer a congressional intent that the knowledge requirement can be fulfilled, and that the employer may therefore be liable, when the employer has no reason to know whether it is the party responsible for the injury or ailment of a particular employee.

507 F.2d at 151. An analysis of the Act and its underlying legislative history support this conclusion.

Subdivisions 912(d) and 930(f) excuse strict compliance with the thirty day and one year limitation periods only if the employer or carrier had "knowledge" of the "injury". The Act defines "injury" as an "accidental injury or death arising out of and in the course of employment, and such occupational disease or infection as arises naturally out of such employment." 33 U.S.C. § 902(2). Therefore, as applied to the facts of this case, the word "injury" means occupational disease or infection naturally arising from employment. Construing subdivisions 902(2), 912(d), and 930(f) pari materia, as we must, "knowledge" of an "injury" means knowledge of an occupational disease which arises from employment, or more simply put, knowledge of a job-related disease. Therefore, the contention by the appellees that the employer need only know of the injury, and need not know of its relationship to employment for the tolling provisions to be triggered, is belied by the definition of injury contained in the Act. This simply is not a case wherein we are asked to read into subdivisions 912(d) and 930(f) after the words "knowledge" and "injury" the phrase "which is claimed to be job-related". The requirement that the knowledge possessed by the employer or carrier be awareness of an illness which is, or is at least claimed to be job-related is mandated by the definition of injury found in subdivision 902(2), as applied to subdivisions 912(d) and 930(f).

We reject the appellees' contention that acceptance of the interpretation urged by the appellants negates the need to consider the...