UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT
filed: March 17, 1977.
SEA-LAND SERVICE, INC., AND THE TRAVELERS INSURANCE COMPANY, PETITIONERS
DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR AND SELEDONIO SUAREZ, RESPONDENTS; (BRB NO. 75-168) SEA-LAND SERVICE, INC. AND TRAVELERS INSURANCE COMPANY, PETITIONERS V. THE DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR, AND FRANK CAPPELLUTI, RESPONDENTS (BRB NO. 75-123)
ON PETITION FOR REVIEW OF ORDER OF THE BENEFITS REVIEW BOARD, UNITED STATES DEPARTMENT OF LABOR.
Van Dusen and Rosenn, Circuit Judges, and Edward N. Cahn, District Judge.*fn*
Author: Van Dusen
Opinion OF THE COURT
VAN DUSEN, Circuit Judge.
These are petitions by an employer and its compensation carrier to review orders*fn1 of the Benefits Review Board (Board) affirming two decisions of administrative law judges which found that the injured employees, Seledonio Suarez and Frank Cappelluti, came within the extended coverage of the 1972 Amendments to the Longshoremen's and Harbor Workers' Compensation Act (LHWCA).*fn2 Because these cases involve the same employer, Sea-Land Service, Incorporated (Sea-Land) and similar questions of law in interpreting the 1972 Amendments, and were argued before the same panel during the same week, they are being decided by a single opinion. In Suarez, No. 76-1033, and in Cappelluti, No. 76-1626, the petitions for review will be granted and the cases remanded to the Board (1) with directions to vacate its orders, as well as any related administrative law judge's orders in those cases, and (2) for further proceedings consistent with this opinion.
I. THE FACTS
(1) Sea-Land. Sea-Land is a large intermodal carrier engaging in containerized*fn3 water-borne and overland truck freight operations. Each claimant was injured in the course of his employment while working in different areas of Sea-Land's Port Elizabeth, New Jersey terminal facility (Terminal). This facility and the complexity of the operations conducted there were recently described by Judge Gibbons in Sea-Land Services, Inc. v. Johns, 540 F.2d 629 (3d Cir. 1976) (hereinafter Johns);*fn4 however, this record contains facts showing the complexity of the Terminal and the activities conducted there. The Terminal is located upon a 92 acre site lying in part along the Elizabeth Channel, a navigable waterway. It includes a general office building, marine operations center, truck operations center, garage and maintenance building, refrigerated warehouse, truck terminal, marshalling yard, freight consolidation building and vessel berths. The entire facility is intersected by a number of public streets. Ocean transportation is only one phase of Sea-Land's operations conducted at the Terminal, which is also utilized as the terminus for truck and containerized railway operations.
(2) Suarez. Suarez was injured while "stripping"*fn5 a container which had been brought into Building 1220.*fn6 Although this building is called a warehouse, it is not a storage facility;*fn7 it is bounded on all sides by public streets and lies about 2000 feet from the Elizabeth Channel. The building is an integral part of the Terminal and the transportation operations conducted by Sea-Land there.
At the time of his injury, November 1, 1973, the claimant had been working for Sea-Land for less than a day. On the day of the injury, Suarez first reported to his usual place of work with his usual employer, Maher Terminals, Incorporated (Maher), a stevedore. Because Maher had no work for him, he went to the union hall to ascertain if any work was available for him with another employer*fn7a within the area. At the hall, Suarez was ordered to report to Sea-Land's Building 1220. Such assignments were made on the basis of a man's seniority and employment classification.*fn8 Suarez was classified as an "extra laborer" or "terminal laborer" and when working for Maher he "stripped" containers after they had been off-loaded from ships by longshoremen and he had frequent occasion to go aboard lighters to assist in the lightering of cargo to and from larger vessels. Sea-Land presented no evidence at the hearing conducted by the administrative law judge to indicate the functional organization of the work force and operations within Building 1220,*fn9 nor does the record clearly indicate that the work carried out there was more definitely related to any specific landward or seaward phase of Sea-Land's operations. The administrative law judge made no fact finding concerning the functional relationship of the claimant's work for Sea-Land which might have been inferred from the nature of his prior employment with Maher and the absence of countervailing testimony from Sea-Land, but concluded that:
" [The] Claimant was engaged in maritime employment and was an 'employee' as defined in Section 902(3). . . . Under the Act as amended, the process of loading or unloading a vessel is not confined to depositing cargo into the hold or moving it from the hold, but rather it encompasses all dockside handling of cargo necessary or appropriate to its continued progress in maritime commerce. [Citing Board cases] In the instant case Claimant was 'stripping ' or unloading a container that had come from a ship. Claimant testified that it was the usual practice to bring containers from a ship to his work location. Respondents point out that Claimant did not see the container in question unloaded from a ship, but they offered no evidence to show this was not the case, although they were in the best position to do so. In view of the above, I find that the work being performed by Claimant was maritime employment."
Decision and Order of May 12, 1975, 74-LHCA-260 at 4 (reproduced in Joint Appendix at 8a). Upon subsequent appeal the Board affirmed*fn10 the administrative law judge's decision concluding inter alia :
"At the time of his accident, the claimant was stripping a container which was used to store cargo on board ship. He was doing this in a terminal which was located 1 1/2 miles from the water's edge where such containers are routinely stripped and prepared for delivery to the appropriate consignees. While unloading the container, some cargo fell on the claimant, injuring the middle finger of his right hand.
"The employer argues that inasmuch as the claimant was not engaged directly in the loading and unloading of ships, he was not engaged in maritime employment and therefore not within the coverage of the Act. It is well settled before the Board that an injury suffered by such a person who is engaged in shoreside activity is entitled to compensation under the extended coverage of the 1972 amendments.
'The expansion of coverage to land-based employees by Congress was intended to include all persons engaged in longshoring operations, Avvento v. Hellenic Lines, BRB No. 74-153 (Nov. 12, 1974), when an injury occurs on a pier, wharf, terminal, etc. areas which have been included in the term "navigable waters" by Congress to delineate the geographic areas where employees engaged in the longshoring industry normally perform their functions. The word "employee" as defined in Section 2(3) of the Act, 33 U.S.C. § 902(3), does not require that one be "actually engaged in loading of vessels" as argued by the employer. The term includes "any longshoreman or other persons engaged in longshoring operations." Thus [even] an employee who is not classified as a longshoreman may be within the Act's coverage if he is engaged in longshoring operations'
Coppolino v. International Terminal Operating Co., 1 BRBS 205, BRB No. 74-136 (Dec. 2, 1974).
"The Board has held, and continues to hold, that such shoreside employees are covered under the 1972 Amendments to the Act. . . . In doing so, we are following the precepts prescribed in the legislative history of these amendments. See Senate Report No. 92-1125."
Board Decision of November 18, 1975, No. 75-168 at 2-3, (reproduced in Joint Appendix at 14A.)
(3) Cappelluti. Cappelluti was injured while cutting-up empty damaged containers which had been placed in the facility marshalling yard. The marshalling yard consists of numbered slots on which chassis and containers unloaded from vessels may be parked. Loaded containers may be stored there awaiting pick-up by truckers or placement aboard an out-bound vessel. Empty containers as well as damaged ones are placed in the yard prior to their repair, scrapping or utilization. The north side of the marshalling yard lies along the Elizabeth Channel and from there extends a considerable distance inland.*fn11 At the time the claimant was injured, various longshoring operations such as vessel unloading were proceeding in the marshalling area. These other operations were unrelated to the cutting-up of the damaged containers.
On the date of his injury, January 18, 1973, the claimant had been working for Sea-Land for approximately nine months. During that period, his work function had been limited to those operations performed in the central maintenance garage where he assisted in the repair and maintenance of truck chassis and made inspections of outgoing trucks as they passed through the inspection line.*fn12 The container which he was scrapping had previously been placed in the marshalling yard along with a number of others after they had been damaged while aboard a vessel, the Ross Sea, by storms at sea.
The administrative law judge found that the claimant was an "employee" within the meaning of 33 U.S.C. § 902(3) after concluding that "the Claimant's work activities, at the time of injury, [were] a complementary and necessary element for the efficient movement of maritime cargo. The 'cutting-up', i.e. salvaging and disposal of a damaged container, was the last, but integral and essential step for the efficient conduct of the longshore operation." Decision and Order of December 31, 1974 at 10 (reproduced in Joint Appendix at 14a). The Board in its review substantially adopted the findings and conclusions of the administrative law judge. See, Board Decision of June 10, 1975, No. 75-123 at 3-4 (reproduced in Joint Appendix at 4a).
II. THE APPLICABLE LAW
A. The Jurisdictional Tests
Before coverage under the 1972 Amendments may be extended to a claimant, he must show that the three jurisdictional tests as set forth in 33 U.S.C. §§ 902(3),*fn13 902(4),*fn14 and 903(a)*fn15 have been satisfied.*fn16 Respectively, these sections require that the claimant have the status of a maritime employee, that the employer be a maritime employer, and that the situs of the injury be an "area customarily used by an employer in loading, unloading, repairing, or building a vessel." This court has recently examined the interwoven meanings of these sections in two opinions which control here, Dravo Corporation v. Maxin, 545 F.2d 374 (3d Cir. 1976) and Johns, supra.
In Johns, Judge Gibbons held that the section 903(a) "situs" test was essentially dependent on the function that the employee was performing for the employer using the following language:
"The reference in §§ 902(4) and 903(a) to the navigable waters of the United States should be regarded [as] no more than a shorthand way of relating the function being performed by the injured employee to water-borne transportation, the jurisdictional nexus. . . . We believe that Congress has exercised in full its legislative jurisdiction in admiralty. As long as the employment nexus (status) with maritime activity is maintained, the federal compensation remedy should be available. Resuscitating the situs requirement in cases satisfying the status test will interfere with Congress' intention to eliminate the phenomenon of shifting coverage."
"The overall intention appears to be to afford federal coverage to all those employees engaged in handling cargo after it has been delivered from another mode of transportation for the purpose of loading it aboard a vessel, and to all those employees engaged in discharging cargo from a vessel up to the time it has been delivered to a place where the next mode of transportation will pick it up. A stevedore may receive cargo at one situs and move it over public streets to another situs for loading on a vessel, or may discharge cargo and transport it to a situs not immediately adjacent to a pier for delivery to a truck or rail carrier. The limits of federal coverage is defined not by reference to a geographic relationship with the navigable waters of the United States, but by the location of the interface between the air land and the water modes of transportation. If that interface is customarily located at some point remote from the pier, the fact that the stevedore uses public streets to move the cargo to or from a "terminal", a "building" or "other adjoining area" does not affect coverage. The key is the functional relationship of the employee's activity to maritime transportation, as distinguished from such land-based activities as trucking, railroading or warehousing.
"The line which Congress intended to draw was between maritime commerce and land commerce, and the coverage of the federal law starts at the point where the cargo passes to or from an employer engaged in the former to an employer engaged in the latter. That the one employer may be engaged in both types of commerce is irrelevant. The line should still be drawn where cargo is delivered to a segregated place for delivery to the next mode of transportation."
Id. at 638-39. (emphasis supplied.)
In Dravo, the court applied the Johns analysis to the carefully developed factual record, to reach its conclusion that the claimant's employment activities for Dravo were functionally within the definition of the term "shipbuilder" as used in section 902(3), the "status" test. The Dravo opinion teaches that the scope of 902(3) was not limited to activities and employees traditionally within the reach of the admiralty subject matter jurisdiction prior to the enactment of the 1972 Amendments; however, it was also emphasized that Congressional admiralty power, and hence the reach of 902(3), was bounded by a "proper conception of maritime concerns." Dravo, supra, at 378 note 4, 10. This limitation applies a fortiori where our inquiry is directed not to the limits of Congressional power but rather to the question whether the Board has observed the distinction between land and maritime occupations in awarding benefits under the LHWCA. The answer to the inquiry must turn first on the facts and inferences developed in the hearings before the administrative law judge and the Board. Without an adequate record and sufficient resolution of contradictory facts and inferences, affirming the Board would mean that our inquiry would be an essentially ad hoc labeling approach. We rejected such a restriction on our review in Dravo and in Johns. See, e.g., Dravo slip op. at 11. In Dravo the thorough fact development by the administrative law judge allowed us to readily conclude, as a matter of statutory interpretation, that the activities came under section 902(3). The fact development in each of the cases now before us does not permit such a conclusion based on administratively found facts.
B. The Suarez and Cappelluti Cases
(1) Suarez. The administrative law judge clearly erred in his opinion that the § 902(3) "status" test was satisfied merely because the container came from a vessel. See pages 991-992 above.*fn17 Such an approach is logically unsatisfactory because it, in effect, applies the § 902(4) "employer" test twice in establishing that the claim falls within the jurisdiction of the LHWCA and the extension of coverage afforded by the 1972 Amendments. In short, the record reveals only that the container was unloaded and that prior to unloading it came from a vessel. We have no idea about why it was unloaded nor about the functional nature of Sea-Land's operations in Building 1220.
At oral argument, the petitioner suggested that Suarez's work principally supported Sea-Land's freight forwarding operations in Building 1220; the claimant contended that the container was unloaded for other reasons, such as customs inspection, which seem to be more clearly identifiable as falling on the maritime side of the interface described in Johns, supra. See notes 4, 8 above. The record contains no evidence which would support one or the other of these functional descriptions of operations carried out in Building 1220. In Johns, supra at 639, Judge Gibbons held that the scope of jurisdiction under the LHWCA was to be consistent with the provisions of the Harter Act, 46 U.S.C. § 193, and the Carriage of Goods by Sea Act, 46 U.S.C. § 1303(3), which define the point at which the responsibility of the maritime carrier begins and ends. It is possible under this view that some of Sea-Land's operations in Building 1220 are without the jurisdictional reach of the Harter Act; however, Sea-Land's status as an intermodal carrier makes resolution of this issue impractical without the development of complete factual records. Thus, it is impossible to tell if the interface between land and maritime commerce as described in Johns, supra, takes place within Building 1220, at some earlier point or at some later point.*fn18
On the state of the record, we must remand for evidence as to whether the stripping of the container was an integral part of the maritime operations or whether the container had reached the land commerce phase of Sea-Land's operations.*fn18a The evidence does show that the loaded container came from a ship, but we do not know when, whether it was stored elsewhere after unloading from the ship and, if so, where. Thus, we are unable to determine whether the container had crossed the interface between land and sea commerce. In this regard, it would be helpful, as we have already indicated, to have evidence of the purpose of stripping the container. What became of the stripped cargo? Was it stored in the warehouse, consolidated with other goods for land or sea shipment, or reloaded on a truck or railroad car? See also factors stated by Judge Friendly at note 18 above.
(2) Cappelluti. The conclusion of the administrative law judge that the section 902(3) "status" test was satisfied because the destruction of the damaged container "was the last, but integral and essential step for the efficient conduct of the longshore operation,"*fn19 is a conclusion unsupported by the record. Also, if the claimant's employment functions for Sea-Land involved only work in the truck maintenance garage and the scrapping of the containers in question, then we hold that these functions are too far removed from maritime commerce to fall within a "proper conception of maritime concerns."*fn20 This holding would cause us to remand the case with instructions to the Board to dismiss it for lack of jurisdiction but for the fact that the record contains testimony to the effect that Sea-Land's maintenance force, of which the claimant was a member, was frequently required to perform maintenance operations aboard the vessels. Although Sea-Land's witnesses controverted this evidence, the conflict was never resolved because the administrative law judge regarded it as "not pertinent to a determination of Claimant's status."*fn21 We disagree, non-specialization of the work of employees as well as incidental and sporadic assignment to maritime and non-maritime work as the needs of the moment dictate were important factors in Dravo and may well be of controlling importance in this case.*fn22 We cannot express any further view of the matter until the functional outlines of Sea-Land's Terminal maintenance operations are fully resolved on the record.*fn23
In SUAREZ, No. 76-1033, and in Cappelluti, No. 76-1626, the petitions for review will be granted and the cases remanded to the Board for further proceedings consistent with this opinion, including findings relevant to, and determinations of, the claimants' status as maritime or nonmaritime employees at the time of the injuries. On remand additional testimony may be taken if the present records do not contain sufficient evidence for the purpose of the above remands.