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Brown v. American-Hawaiian S.S. Co.


decided as amended march 17 1954: February 9, 1954.


Author: Mclaughlin

Before McLAUGHLIN, KALODNER and STALEY, Circuit Judges.

McLAUGHLIN, Circuit Judge.

On February 4, 1949, one Preston Brown, then an employee of Luckenbach Steamship Company, Inc., was injured while aboard the S. S. Belgium Victory, a vessel operated under bareboat charter by American-Hawaiian Steamship Company. At the time of the injury Luckenbach had a stevedoring contract with American-Hawaiian pursuant to which Brown and other stevedore employees of Luckenbach were engaged in unloading operations. Brown instituted a civil suit against American-Hawaiian, as pro hac vice owner of the vessel, alleging unseaworthiness and negligence in that it had failed to provide him with a safe place to work and had neglected to furnish and maintain proper equipment and gear. More particularly, he charged, defendant had failed to exercise care in the maintenance of an ore bucket the handle of which was "caused to become disengaged", resulting in the injuries complained of.

American-Hawaiian denied liability in its answer and filed a third-party complaint against Brown's employer, Luckenbach, in which it asked for "contribution and/or indemnity." The bases of this claim are two: (1) that the equipment which caused the injury was furnished, installed, operated and controlled by and was the property of Luckenbach and that it was supplied pursuant to the stevedoring contract; (2) that if Brown sustained injuries as a result of the unseaworthiness of any equipment aboard the vessel such unseaworthiness was caused by the negligence of Luckenbach.

Luckenbach moved to dismiss the third-party complaint and the motion was granted on the authority of Halcyon Lines v. Haenn Ship Ceiling & Refitting Corp., 342 U.S. 282, 72 S. Ct. 277, 96 L. Ed. 318. An appeal from the order of dismissal followed which was dismissed by this court on December 5, 1952, on the ground that the order was interlocutory. Thereafter American-Hawaiian moved the district court for a determination under Rule 54(b), Federal Rules of Civil Procedure, 28 U.S.C., that, there being no just reason for delay, a final order of dismissal be entered against it. The motion was granted, the judgment was entered and this appeal followed.*fn1

After the present notice of appeal was filed this court decided Crawford v. Pope & Talbot, Inc., 3 Cir., 206 F.2d 784, a case very similar on its facts to the instant one, in which we held that while contribution was barred by Halcyon, supra, a right of indemnity based on contractual relations between the parties could be asserted. Appellee concedes, as he must, that if the Crawford decision is the law it is dispositive of this appeal, arguing, however, that it cannot stand in the face of the still later Supreme Court opinion in Pope & Talbot, Inc. v. Hawn, 1953, 346 U.S. 406, 74 S. Ct. 202.

A comparison of the Hawn case and the present litigation shows that in both situations the owner-defendant impleaded the plaintiff's employer and asked for "contribution and/or indemnity." In Hawn the trial court disallowed indemnity but granted contribution up to the amount of the employer's liability to the employee under the Longshoremen's and Harbor Workers' Act, 44 Stat. 1424, 33 U.S.C.A. ยง 901 et seq. We reversed the allowance of contribution on the basis of the Supreme Court's opinion in the Halcyon case, which had been decided after the district court's Hawn decision. 3 Cir., 198 F.2d 800. The owner, on appeal to us, had asked, among other things, that it be awarded full indemnity from the employer because the latter's breach of duty toward the employee was primary while its own was secondary. In rejecting this claim we held that the jury's verdict showed both defendant and third-party defendant to be equally and concurrently at fault, not that the owner's theory of indemnity was unsound as a matter of law. The Supreme Court opinion in Hawn, which affirmed the decision of this court, did not, while upholding our disposition of the claim for contribution, advert to the indemnity feature of the case.*fn2 It is thus readily apparent that there is nothing in any phase of Hawn which is inconsistent with our Crawford decision.*fn3

There is, however, one aspect of the present appeal which requires further refinement. Appellant suggests that irrespective of the contractual relations between third-party plaintiff (owner) and third-party defendant (employer) in this type of suit, a right of indemnity exists where the liability of the former is secondary or passive while that of the latter is primary or active. Such a problem would be posed, for example, where the owner is held liable to a plaintiff-employee for a condition of unseaworthiness created by the employer's negligence and there is no contract, express or implied, between them,*fn4 or, if such contract exists, it cannot be read to lay the groundwork for an indemnification claim. In answer to this suggestion we repeat what we thought had been made clear by the Crawford case: there can be no action of indemnity in these cases which is not based on the violation of some contractual duty.*fn5 Were the rule otherwise the employer could be made to respond indirectly in tort for damages for which he would not be answerable under the Longshoremen's and Harbor Workers' Act. Such a rule would be violative of Section 5 of the Act*fn6 as well as of the spirit of the entire statute whereunder an employer's duty to pay compensation to his injured employees without regard to negligence is substituted for his common law tort liability. Cf. Pope & Talbot, Inc. v. Hawn, 346 U.S. 406, 412, 74 S. Ct. 202.

The judgment will be reversed and the cause remanded for further proceedings not inconsistent with this opinion.

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