Wahlstrom v. Kawasaki Heavy Industries, Ltd.

• Decision Date: 13 September 1993
• Docket Number: No. 774,D,774
• Parties: Prod.Liab.Rep.(CCH)P 13,630 Donald WAHLSTROM and Irene Wahlstrom, Administrators of the Estate of Scott Wahlstrom, Plaintiffs-Appellants, v. KAWASAKI HEAVY INDUSTRIES, LTD., Kawasaki Motors Corp., U.S.A., Kawasaki Motors Manufacturing Corp., U.S.A., Defendants-Appellees. ocket 92-7948.
• Court: U.S. Court of Appeals — Second Circuit

Page 1084

4 F.3d 1084

Prod.Liab.Rep.(CCH)P 13,630

Donald WAHLSTROM and Irene Wahlstrom, Administrators of the Estate of Scott Wahlstrom, Plaintiffs-Appellants, v. KAWASAKI HEAVY INDUSTRIES, LTD., Kawasaki Motors Corp U.S.A., Kawasaki Motors Manufacturing Corp U.S.A., Defendants-Appellees.

No. 774, Docket 92-7948.

United States Court of Appeals Second Circuit.

Argued Jan. 5, 1993.

Decided Sept. 13, 1993.

Richard L. Newman, Bridgeport, Conn. (Michael F. Ewing, Cohen & Wolf, of counsel), for plaintiffs-appellants.

Richard A. Mueller, Coburn & Croft, St. Louis, Mo. (Trudie R. Hamilton, William I. Garfinkel, Carmody & Torrance, Waterbury, Conn., of counsel), for defendants-appellees.

Before: PRATT and MAHONEY, Circuit Judges, and ZAMPANO, ^* District Judge.

MAHONEY, Circuit Judge:

Donald and Irene Wahlstrom ("the Wahlstroms") appeal from a judgment entered August 25, 1992 in the United States District Court for the District of Connecticut, Alan H. Nevas, Judge, that granted defendants' motion for summary judgment and dismissed the Wahlstroms' state law claims for the wrongful death of their son on the basis that a case involving a collision between two pleasure craft on navigable waters falls within the court's admiralty jurisdiction and, under general maritime law, recovery of wrongful death damages is barred where plaintiffs are not dependents of the decedent. We conclude that the state law claims were properly dismissed because actions brought under the federal courts' admiralty jurisdiction are governed solely by federal maritime law. We also conclude, however, that the Wahlstroms have stated, at least to some extent, a valid claim for wrongful death damages under federal maritime law as to which there are disputed issues of material fact. Accordingly, the judgment of the district court is vacated and the case is remanded for further proceedings not inconsistent with this opinion.

Background

The facts in this case are straightforward and undisputed. On June 19, 1988, Scott Wahlstrom ("Scott"), the 17-year old son of the Wahlstroms, was killed when the rented Kawasaki 650 SX Jet Ski that he was operating collided with a twenty-foot power boat on the Thames River, a navigable waterway, within Connecticut territorial waters. The Wahlstroms, as the administrators of Scott's estate, brought an action under the Connecticut Product Liability Act, Conn.Gen.Stat. Sec. 52-572m et seq. (1991), and the Connecticut Unfair Trade Practices Act, Conn.Gen.Stat. Sec. 42-110a et seq. (1992), against Kawasaki Heavy Industries, Ltd., Kawasaki Motors Corp., U.S.A., and Kawasaki Motors Manufacturing Corp., U.S.A. (collectively "Kawasaki"), the companies that designed, manufactured, and distributed the rented Jet Ski that Scott was using at the time of his accident, basing federal jurisdiction upon diversity of citizenship. The Wahlstroms sought compensatory damages, attorney fees pursuant to Conn.Gen.Stat. Sec. 52-240a (1991), and punitive damages pursuant to Conn.Gen.Stat. Secs. 52-240b (1991) and 42-110g(a) (1992).

Kawasaki moved for summary judgment on the basis that the action was governed solely by federal maritime law, which barred the Wahlstroms from any recovery. Opposing the motion, the Wahlstroms argued that the case was governed by Connecticut law, but even if federal maritime law applied, Scott's estate was entitled to recover damages. Judge Nevas referred the case to Magistrate Judge Arthur H. Latimer to rule on that motion.

In a recommended ruling issued April 7, 1992, Magistrate Judge Latimer determined that Kawasaki's motion should be granted. See Wahlstrom v. Kawasaki Heavy Indus., Ltd., 800 F.Supp. 1061 (D.Conn.1992). He concluded that the case was governed by federal maritime law, id. at 1062-63, and that "the general maritime law does not allow the nondependents of a decedent who is not a seaman to recover wrongful death damages for his death arising in state territorial waters." Id. at 1063 (citing Anderson v. Whittaker Corp., 692 F.Supp. 764, 770-73 (W.D.Mich.1988), aff'd in part, rev'd in part on another ground, 894 F.2d 804 (6th Cir.1990); Truehart v. Blandon, 672 F.Supp. 929, 936-38 (E.D.La.1987)). Reviewing the applicable Supreme Court precedents, Magistrate Judge Latimer stated:

A collective reading of these cases reveals three points: (1) the Supreme Court has never held that a nondependent beneficiary may recover loss of society, i.e., non-pecuniary, damages in a general maritime wrongful death action; (2) the explicit language of the DOHSA does not permit the recovery of non-pecuniary damages, nor may such recovery be supplemented by state wrongful death statutes or the general maritime law where the DOHSA governs; and (3) the Jones Act does not provide wrongful death damages to the nondependent survivors of a deceased seaman.

Id. at 1065.

Stressing the need for uniformity in admiralty law, the anomaly of allowing a recovery to the Wahlstroms that would not be available to them if Scott had been a member of the specially favored class of seamen, and the overall fairness of a distinction between dependents and nondependents, the magistrate judge concluded that the Wahlstroms' claims, including their application for punitive damages, should be dismissed. Id. at 1065-66.

The Wahlstroms objected to this recommended ruling, contending that "admiralty jurisdiction is inappropriate in this products liability case," and in any event that the magistrate judge had erred in his analysis of federal maritime law. After review and over the Wahlstroms' objections, however, the district court approved and adopted the magistrate judge's recommended ruling. Id. at 1061.

Judgment was then entered in favor of Kawasaki. This appeal followed.

Discussion

It is settled law that a tort claim involving a collision between two vessels, used for pleasure or commercial purposes, on navigable waters comes within the admiralty jurisdiction of the federal courts. See Foremost Ins. Co. v. Richardson, 457 U.S. 668, 677, 102 S.Ct. 2654, 2659, 73 L.Ed.2d 300 (1982); In re Guglielmo, 897 F.2d 58, 61 (2d Cir.1990). The parties to this appeal do not dispute that both the Jet Ski operated by Scott and the power boat involved in the collision are vessels under 1 U.S.C. Sec. 3 (1988), ¹ or that the Thames River (at the location where the fatal collision occurred) is a navigable waterway. Further, the Wahlstroms concede on appeal that this case falls within the admiralty jurisdiction of the federal courts. With this jurisdiction comes the application of substantive maritime law, and absent a relevant federal statute, we apply the general maritime law as developed by the courts. East River S.S. Corp. v. Transamerica Delaval, Inc., 476 U.S. 858, 864, 106 S.Ct. 2295, 2298, 90 L.Ed.2d 865 (1986). That law includes elements adopted from the law of products liability. See id. at 865-66, 106 S.Ct. at 2299.

The Wahlstroms advance two contentions on appeal: (1) federal maritime law does not preclude the application of state wrongful death statutes, and therefore the Connecticut Products Liability Act and its wrongful death provisions should govern this action; or (2) in the alternative, if this court finds that federal maritime law governs, the principles underlying the Connecticut wrongful death provisions should be used to fashion the federal maritime remedy. Before considering these contentions, we address a preliminary matter.

The Wahlstroms did not request relief under federal maritime law in their complaint; rather, they raised only state law claims. Nor did they seek leave to file an amended complaint to include a claim for wrongful death damages under federal maritime law. Kawasaki, however, raised the applicability of federal maritime law as an affirmative defense, and this issue was extensively discussed by Magistrate Judge Latimer in his recommended ruling. Further, the parties' briefs and oral argument on appeal focused squarely on the issue of what relief, if any, is available to the Wahlstroms under federal maritime law. Accordingly, we deem the Wahlstroms' complaint to be constructively amended to include a claim for relief for wrongful death damages under federal maritime law. See 6A Charles A. Wright et al., Federal Practice and Procedure Sec. 1494, at 55-56 (2d ed. 1990) (appellate courts, using Fed.R.Civ.P. 15(b) by way of analogy, permit constructive amendment of pleadings "only when the effect will be to acknowledge that certain issues upon which the lower court's decision has been based or issues consistent with the trial court's judgment have been litigated"); see also Purofied Down Prods. Corp. v. Travelers Fire Ins. Co., 278 F.2d 439, 444 (2d Cir.1960) (where insurer did not assert counterclaim for back premiums and issue was not raised by pleadings, but attorney for insured admitted premiums were due, appellate court deemed pleadings amended to conform to the evidence); Menefee v. W.R. Chamberlin Co., 183 F.2d 720, 721 (9th Cir.1950) (where injured seaman alleged only leg injury but evidence of back injury was also presented without objection, the back injury was regarded on appeal as matter that had been tried by lower court); cf. Walton v. Jennings Community Hosp., Inc., 875 F.2d 1317, 1320 n. 3 (7th Cir.1989) (collecting cases in which district and appellate courts allowed constructive amendment of complaints).

A. Application of State Law in a Maritime Wrongful Death Action.

Magistrate Judge Latimer dismissed the Wahlstroms' state law claims because those claims " 'would be in conflict with the applicable substantive admiralty law.' " Wahlstrom, 800 F.Supp. at 1063 (quoting Icelandic Coast Guard v. United Technologies Corp., 722 F.Supp. 942, 949 (D.Conn.1989)). According to Magistrate Judge Latimer, because Connecticut tort law would permit recovery of damages by nondependent beneficiaries and maritime law would not, the Supremacy Clause mandates preemption of state law in this case. Id. We go...