Deisler v. Aggregates

Opinions of the United

1995 Decisions States Court of Appeals

for the Third Circuit

5-3-1995

Deisler v Aggregates

Precedential or Non-Precedential:

Docket 94-5310

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UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

No. 94-5310

FRANCIS A. DEISLER

Plaintiff-Appellee,

v.

McCORMACK AGGREGATES, CO.;

DREDGE "SANDY HOOK", her

boilers, engines, tackle,

appurtenances, etc.

Defendants-Appellants

ON APPEAL FROM THE UNITED STATES

DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY

(Civil No. 90-2828)

Argued: October 31, 1994

Before: GREENBERG, McKEE, Circuit Judges,

and POLLAK, District Judge.*

(Filed May 3, 1995)

GEORGE J. KOELZER (Argued)

CAROLYN J. SHIELDS

Lane Powell Spears Lubersky

333 South Hope Street

Suite 2400

Los Angeles, California 90071

Counsel for Defendants-Appellants

McCormack Aggregates, Co;.

Dredge "Sandy Hook"

GEORGE J. CAPPIELLO (Argued)

PAUL T. HOFMANN

Cappiello Hofmann & Katz

30 Montgomery Street

Jersey City, New Jersey 07302

*Honorable Louis H. Pollak, United States District Judge for

the Eastern District of Pennsylvania, sitting by designation.

Counsel for Plaintiff-Appellee

Francis A. Deisler

OPINION OF THE COURT

McKee, Circuit Judge.

We are asked to decide, among other things, if a seaman's

failure to disclose a prior injury on a job application causes

the seaman to forfeit his entitlement to maintenance and cure.

We hold that, under the circumstances presented here, no such

forfeiture has occurred and we will thus affirm the district

court's judgment.

I. FACTUAL BACKGROUND

McCormack Aggregates, Co. operates various dredging vessels

in connection with its business of mining sand from the bottom of

the sea. Francis Deisler is a seaman who is a member of

International Union of Operating Engineers, Local 25 - Marine

Division. That union periodically refers workers to employers

who operate dredging vessels and equipment. In 1982, Deisler

injured his back while he was working on a dredge and he was

disabled for about six months. Thereafter, he returned to jobs

involving heavy physical labor including construction work,

dockbuilding and dredging.

On August 3, 1988, while Deisler was working as a dredgeman

for another boating company, his union referred him to McCormack

where he filled out an application for a position as a boatman.

That application included the following question: "Do you have

any physical limitations which would hinder your performance in

the position applied for?" Deisler did not answer the question.1

On June 12, 1989, some 10-1/2 months after he filled out the

application, Deisler's union told him to report for work with

McCormack on June 13.2 Deisler's application apparently was

never reviewed. The sections on the bottom portion of the

application labelled "Reviewed By" and "Approved By," which were

for "office use only," were left blank.

1

Although there was some dispute at trial about Deisler's prior

injury, Deisler offered testimony that he had been pain free for

three years prior to filling out the job application. It is

undisputed that Dr. Edward Taylor, an orthopedic surgeon, treated

Deisler for a herniated disk at L3-4 in 1985, and prescribed

medication and exercise. Thereafter Deisler's condition improved

and he resumed work as a manual laborer.

Deisler testified that when he filled out the job

application, he believed he had no physical limitation which

would hinder his job performance with McCormack.

2

The district court's Findings of Fact state that Deisler

reported for work on June 14, 1989. April 26, 1994, Findings of

Fact, ¶ 4. However, that appears to be an error. Deisler's

uncontroverted trial testimony is that he received the call to

report to work on Monday, June 12, 1989 and he reported the next

day. See Suppl. App. at 4 (Deisler's trial testimony).

Deisler was injured almost immediately after he began

working for McCormack. The district court described the incident

which caused his injury as follows:

On June 15, 1989, . . . plaintiff suffered an

injury while moving a wheelbarrow loaded with

supplies along a path on McCormack's

property. This job had been assigned to him

by his supervisors, Messrs. Ellis and

Melendez, who were, respectively, the

tugboat's Captain, and the dredge's

Dragtender . . . . The accident occurred

when he [Deisler] rolled the wheelbarrow off

the vessel side of the ramp, and the

wheelbarrow's wheel went onto the sandy path.

The wheelbarrow became unstable, stopped

short, and fell onto its side, spilling its

contents. Plaintiff's forward momentum

caused him to tumble and fall over the

stopped wheelbarrow. Immediately after his

fall he felt a sharp pain in his back.

April 26, 1994, Findings of Fact, ¶ 5.

The district court found that Melendez and Ellis saw this

incident.3 Both were in the dredge's dragtender's cabin which

was a raised work platform which overlooked the location where

Deisler fell. Melendez testified that Ellis ducked down when

Deisler fell so that Deisler would not know that Ellis had

witnessed the accident, and that Ellis told him (Melendez) that

he had seen Deisler fall.

The following morning Ellis asked Deisler to move some heavy

cables, but Deisler complained that his back was hurting.

Deisler then left the vessel, went to the company's offices, and

3

Melendez testified at trial that he saw the aftermath.

began filling out an accident report of his fall and the

resulting back injury. Deisler then went to the office next door

where he was given a dismissal notice which stated that he was

being fired for unsatisfactory work performance.

Before Deisler left McCormack's offices, he took a New

Jersey Disability Benefits claim form that he sent to his

physician. Deisler's physician completed that form and returned

it to McCormack after June 27, 1989. Thereafter, Deisler made a

claim for maintenance and cure, and McCormack hired the maritime

investigative firm of Lamorte and Burns, Inc. to investigate that

claim. Lamorte was succeeded by American Maritime Consultants.4

Following the investigation of Deisler's claim, both Lamorte and

American Maritime recommended that McCormack pay Deisler the

requested maintenance and cure, but McCormack refused and Deisler

filed suit against McCormack and its dredge under the Jones Act,5

and under general maritime law.

Those two causes of action were tried simultaneously with

the jury sitting as the finder of fact on the Jones Act claim and

the court sitting as finder of fact on the general maritime

claim. The jury found the defendants were not negligent and

4

Bernard Lillis, McCormack's Chief Financial Officer also

investigated Deisler's claim. Lillis delegated some of the

investigation to Brad Simek, McCormack's Dredge Superintendent

who oversaw the operations of the dredge and its crew.

5

The Jones Act provides in part that "[a]ny seaman who shall

suffer personal injury in the course of his employment may, at

his election, maintain an action for damages at law, with the

right of jury trial, . . . ." 46 U.S.C. § 688.

returned a verdict in their favor under the Jones Act. However,

the district court granted plaintiff's motion for a new trial on

the Jones Act claim but plaintiff elected to discontinue that

cause of action in favor of his claim for maintenance and cure,

and also for compensatory damages, under the general maritime

law. The court ruled that plaintiff was entitled to maintenance

and cure under general maritime law, and also awarded plaintiff

compensatory damages based upon defendants' arbitrary and

capricious denial of plaintiff's claim. The defendants6 appeal

from this judgment of the district court.

II. DISCUSSION

The district court had subject matter jurisdiction over this

admiralty action under 28 U.S.C. § 1333. We have appellate

jurisdiction over the final judgment of the district court

pursuant to 28 U.S.C. § 1291. We review the district court's

findings of fact under a clearly erroneous standard. See Sheet

Metal Workers Int'l Ass'n Local 19 v. 2300 Group, Inc., 949 F.2d

1274, 1278 (3d Cir. 1991). However, our review of the district

court's application of the law to these facts is plenary. See

Tudor Dev. Group v. United States Fidelity & Guar. Co., 968 F.2d

357, 359 (3d Cir. 1992).

A. Maintenance and Cure

The gravamen of McCormack's argument is that Deisler

forfeited his right to maintenance and cure when he failed to

6

Hereinafter both defendants will be referenced as "McCormack."

disclose his prior back injury as requested on the employment

application.

Maintenance and cure are rights given to seamen who become

ill or injured in the service of a vessel.7 "Maintenance is the

living allowance for a seaman while he is ashore recovering from

injury or illness. See Vaughan v. Atkinson, 369 U.S. 527, 531,

82 S.Ct. 997, 1000, 8 L.Ed.2d 88 (1962). Cure is payment of

medical expenses incurred in treating the seaman's injury or

illness. See Calmar S.S. Corp. v. Taylor, 303 U.S. 525, 528, 58

S.Ct. 651, 653, 82 L.Ed. 993 (1938)." Barnes v. Andover Co.

L.P., 900 F.2d 630, 633 (3d Cir. 1990). An employer's obligation

to furnish maintenance and cure continues "until the seaman has

reached the point of maximum cure, that is until the seaman is

cured or his condition is diagnosed as permanent and incurable."

Barnes, 900 F.2d at 633-34; see also Vella v. Ford Motor Co., 421

U.S. 1, 5 (1975).

The origins of the duty to provide maintenance and cure have

been traced to Justice Story in Harden v. Gordon, 11 F. Cas. 480,

482-83 (C.C.D. Me. 1823).8 The Supreme Court first recognized

and defined these rights in The Osceola, 189 U.S. 158, 175

7

It is undisputed that Deisler is a maritime employee who would

normally be entitled to maintenance and cure.

8

For a discussion of the historical underpinnings and evolution

of a seaman's right to maintenance and cure see Cox v. Dravo

Corp., 517 F.2d 620 (3d Cir. 1975).

(1903).9 "The duty was derived from medieval maritime codes,"

Barnes, 900 F.2d at 633, and is interpreted in such a way as to

afford injured seamen the maximum protection of the law.

9

In The Osceola, a crew member sued for injuries sustained in

carrying out an order given by the master. There was no

allegation that the mate or the crew were negligent in their

execution of the master's order. Rather, plaintiff claimed that

the vessel and its owners should be liable for the negligent

order of the captain in the course of the navigation or

management of the vessel. 189 U.S. at 159-60. The district

court held that the vessel was liable in rem for plaintiff's

injuries, and the Circuit Court of Appeals certified certain

questions of law to the Supreme Court. The Supreme Court denied

recovery.

The Court distilled the substance of the questions before it

into the sole issue of whether the vessel owner was liable in rem

to one of the crew by reason of the improvident and negligent

order of the master. The Court began its analysis by noting that

for the district court's conclusion to be correct, the liability

must be founded upon the general admiralty law or upon a local

statute of the state in which the accident occurred. Id. at 168.

The Court then went on to examine the Continental codes and the

American case law. The Court reasoned that while the Continental

codes had restricted seamen to the traditional remedy of

maintenance and cure, the American cases, perhaps stimulated by

the English Merchants Shipping Act of 1876, had allowed recovery

of an "indemnity" for unseaworthiness. However, these cases

denied recovery for negligence in "navigation and management."

Based on its review of these authorities, the Court opined:

That the seaman is not allowed to recover an

indemnity for the negligence of the master, or any

member of the crew, but is entitled to maintenance and

cure, whether the injuries were received by negligence

or accident.

Id. at 175.

This proposition was undercut with the passing of the Jones

Act, which provided that a seaman who is injured in the course of

his employment by the negligence of the owner, master, or fellow

crew members could recover damages for his injuries. See Grant

Viewing seamen as wards of admiralty, the

Court has emphasized that the right to

maintenance and cure must be construed

liberally and has consistently expanded the

scope of the right. Thus, today a shipowner

is obliged to pay maintenance and cure

regardless of any fault on its part; only

wilful misconduct on the part of the seaman

will deprive him of its protection.

Id. (citations omitted). Although conditions have clearly

changed since this concept was first introduced into law, the

right of recovery for maintenance and cure has continued to be a

fundamental component of the relationship between employees and

employers at admiralty.

"[T]he seaman's right was firmly

established in the maritime law long before

recognition of the distinction between tort

and contract."

[It is argued that] the rationale

underlying the right of maintenance, which is

predicated on the special status of seamen as

"wards of the admiralty," is no longer valid.

It is true that almost every case concerning

the right to maintenance relies on Justice

Story's description of the seaman as

"generally poor and friendless, and

acquir[ing] habits of gross indulgence,

carelessness, and improvidence."

[It is also argued that] today those seamen

who are unionized are neither friendless nor

improvident . . . . Furthermore, the

adjectives "friendless" and "helpless" were

generally used to describe sailors in foreign

ports . . . .

The changed circumstances of the unionized

seaman may undercut the rationale supporting

the traditional right to maintenance and

(..continued)

Gilmore & Charles L. Black, Jr., The Law of Admiralty § 6-2, at

276-277 (2d ed. 1975).

cure, at least for unionized seamen.

However, the Supreme Court has shown no

inclination to depart from its long

established solicitude for seamen. Until it

does so, we see no basis to assume that the

emergence of powerful seamen's unions, . . .

justifies our ignoring the Court's clear and

frequent pronouncements that seamen remain

wards of the admiralty.

Id. at 636-37 (citations omitted).

A ship owner's responsibility for maintenance and cure

"extends beyond injuries sustained on board ship or during

working hours to any injuries incurred in any place while the

seaman is subject to the call of duty." Id. at 633; see also

Aguilar v. Standard Oil Co., 318 U.S. 724, 732 (1943). As noted

above, only the seaman's willful misconduct or deliberate

misbehavior relieves the ship operator of this duty. See Barnes,

900 F.2d at 633.10

1. Deisler's Failure to Disclose His Prior Injury

McCormack contends that Deisler's failure to disclose his

prior back injury is the kind of misbehavior which relieves it of

the duty it would otherwise have to provide maintenance and cure.

However, nondisclosure of a pre-existing injury, without more,

will not result in a seaman's loss of maintenance and cure. Such

a forfeiture will not occur unless Deisler intentionally

misrepresented or concealed medical facts that were material to

10

The duty to provide maintenance and cure is independent of

any fault of the employer, and the seaman's contributory

negligence does not affect his right to maintenance and cure.

The Osceola, supra; Aguilar, 318 U.S. at 731.

the decision to hire Deisler. In addition, there must be a nexus

between the improperly concealed material information and the

disputed injury. See McCorpen v. Central Gulf Steamship Corp.,

396 F.2d 547, 549 (5th Cir.), cert. denied, 393 U.S. 894 (1968)

(where a seaman is required to provide pre-employment medical

information and "the seaman intentionally misrepresents or

conceals material medical facts, the disclosure of which is

plainly desired, then he is not entitled to an award of

maintenance and cure," if the injury is causally related to the

concealed medical condition); Wactor v. Spartan Transportation

Corp., 27 F.3d 347, 352 (8th Cir. 1994) (adopting the McCorpen

standard); Siders v. Ohio River Co., 469 F.2d 1093 (3d Cir. 1972)

(per curiam) (citing McCorpen).11 Given the historical

importance of a seaman's claim for maintenance and cure, it

11

In Sammon v. Central Gulf Steamship Corp., 442 F.2d 1028 (2d

Cir.), cert. denied, 404 U.S. 881 (1971), the Court of Appeals

for the Second Circuit stated that the rule in McCorpen "that any

concealment of material medical data, prevents an award for

maintenance and cure is not the rule of this Circuit." Id. at

1029. The Sammon court held that the concealment of a pre-

existing condition by the seaman during a pre-hiring interview

"is fraudulent only if the seaman knows or reasonably should know

that the concealed condition is relevant." Id. Under that rule,

a seaman may claim maintenance and cure for a related injury or

illness if, at the time he was asked, he held a good faith belief

that the pre-existing condition was not relevant to his fitness

for work. Id. Even if there is some tension between the rule of

McCorpen and the rule of Sammon, see Wactor, 27 F.3d at 352 n.4,

it is not relevant to this case, because, as discussed in the

text, McCormack has not proven that Deisler's omission was

material to its decision to hire him.

should not be lost unless the employee's purportedly wrongful

conduct was material to an employer's hiring decision.

The district court concluded that Deisler should have

disclosed his prior injury in response to the inquiry on the

employment application. The court ruled that McCormack's inquiry

into prior injuries created an inference that the information was

material to McCormack. The court went on to conclude, however,

that this "inference" of materiality was destroyed by the fact

that McCormack's decision to deny maintenance and cure was not

predicated on the concealment but rather on McCormack's

contention that an accident never happened. Suppl. App. at 107-

08. In Deisler's view, the district court found that the

concealment was not material to McCormack's decision to hire

Deisler. But that clearly is not what the district court found.

We thus view Deisler's materiality argument as an alternative

argument for affirming the judgment. Cf. Mark v. Borough of

Hatboro, No. 94-1722, slip op. at 3 n.1 (3d Cir. Mar. 31, 1995)

("we can affirm on a ground which the district court did not rely

but which was raised before it.").

Assuming arguendo that the question on McCormack's

application created a duty to disclose,12 the record is

12

McCormack argues that Deisler's failure to cross-appeal means

that we must accept the district court's finding that Deisler

should have disclosed that he could not perform the work as

readily as others because of his prior back injury. The argument

is frivolous. Of course, an appellee is entitled to rely on

alternative arguments which had been raised in the district court

supporting the judgment without filing a cross-appeal, so long as

he or she is not seeking to expand his or her rights under the

absolutely clear that Deisler's omission was not material to

McCormack's hiring decision. Deisler was never questioned about

his failure to answer although McCormack had eleven months to

review his job application before he was told to report for work.

This is evidenced by the fact that the sections on the bottom

portion of the application labelled "Reviewed By" and "Approved

By" were left blank. One of the investigators working for

Lamorte stated:

I met with McCormack Aggregates, Mr. Brad

Simek, to discuss the hiring of Mr. Deisler

and specifically to find out if there was a

policy or practice of questioning prospective

employees about medical conditions, or if

anyone could testify as to any conversations

with Deisler that the back condition predated

his employment with McCormack.

Unfortunately, McCormack is unable to provide

me with any such supporting testimony.

Suppl. App. at 182.

McCormack argues that its failure to investigate Deisler's

omission is irrelevant. Reply Brief of Appellant at 4. However,

McCormack had the burden of proving that the omission was

material to its decision to hire Deisler, see Wactor, 27 F.3d at

352; Ruiz v. Plimsoll Marine, Inc., 782 F. Supp. 315, 317 (M.D.

La. 1992), and its failure to do so is fatal to its assertion

(..continued)

judgment or limit another's rights. See Mark v. Borough of

Hatboro, No. 94-1722, slip op. at 3 n.1 (3d Cir. Mar. 31, 1995).

that Deisler is not now entitled to recover maintenance and

cure.13

B. Wages, Compensatory Damages, Prejudgment Interest, Attorney's

Fees and Costs

McCormack argues that even if Deisler can recover

maintenance and cure, the district court erred in awarding lost

wages, damages for pain and suffering, prejudgment interest,

costs, and attorney's fees, as those are not an incident of the

seaman's contract of employment.14 McCormack asserts that these

damages are an incident of negligence under the Jones Act and

that since Deisler elected to dismiss his Jones Act claim after

13

We reject McCormack's contention that we should, here,

presume reliance from the simple fact that it asked the question.

But there may be situations where courts should presume such

reliance. For instance, if a shipowner requires a prospective

applicant to submit to a physical examination and/or to fill out

a detailed medical history form, the extent to which the employer

will be required to submit affirmative proof of reliance should

be diminished. It is not that reliance is no longer required;

rather, it is that the employer will there have demonstrated

reliance by adopting a particular procedure or form. However,

where, as here, a general question about past illnesses and

injuries is but a single question in a standard form employment

application, the situation is markedly different. The question

is simply one of many questions on a variety of topics, and the

rather vague inquiry into medical history may not ever be

reviewed by anyone at all. The employer's interest in the

information is significantly less than in the prior examples, and

it therefore makes sense to require the shipowner to present

evidence of reliance.

14

Although lost wages are qualitatively different from

damages for pain and suffering as the former would certainly be

deemed an incident of the seaman's contract of employment, for

purposes of our discussion, we will accept McCormack's conflation

of these damages.

the trial, the nature of the two causes of action, and the law of

the case precludes recovery for these damages under general

maritime law. See Brief of Appellant at 13.

In Cortes v. Baltimore Insular Line, Inc., 287 U.S. 367

(1932), the Supreme Court discussed the impact of the then

recently enacted Jones Act upon general maritime law. The Court

stated:

By the general maritime law, a seaman is

without a remedy against the ship or her

owners for injuries to his person, suffered

in the line of service, with two exceptions

only . . . . A remedy is his also if the

injury has been suffered through breach of

the duty to provide him with "maintenance and

cure." The duty to make such provision is

imposed by the law itself as one annexed to

the employment. The Osceola, supra.

Contractual it is in the sense that it has

its source in a relation which is contractual

in origin, but, given the relation, no

agreement is competent to abrogate the

incident. If the failure to give maintenance

or cure has caused or aggravated an illness,

the seaman has his right of action for injury

thus done to him; the recovery in such

circumstances including not only necessary

expenses, but also compensation for the hurt.

The Iroquois, 194 U.S. 240 . . . .

The question then is to what extent the

ancient rule has been changed by modern

statute . . . commonly known as the Jones Act

. . . . We are to determine whether death

resulting from the negligent omission to

furnish care or cure is death from personal

injury within the meaning of the statute.

We think the origin of the duty is

consistent with a remedy in tort, since the

wrong, if a violation of a contract, is also

something more. The duty, as already pointed

out, is one annexed by the law to a relation

and annexed as an inseparable incident

without heed to any expression of the will of

the contracting parties. For breach of a

duty thus imposed, the remedy upon the

contract does not exclude an alternative

remedy built upon the tort.

Id. at 370-72. Several courts have since cited Cortes for the

proposition that an employee may recover damages resulting from

an employer's failure to provide maintenance and cure. See e.g.

Vaughn v. N.J. Atkinson, 369 U.S. 527, 530 (1962); Murphy v.

Light, 257 F.2d 323, 325 (5th Cir. 1958); Sims v. United States

of America War Shipping Admin., 186 F.2d 972, 974 (3d Cir. 1951).

In Sims, the district court disallowed a claim for

additional damages in an action for maintenance and cure that a

seaman brought under the Suits in Admiralty Act, 46 U.S.C.A. §

741 et. seq.15 In reversing we stated:

The new question in this case is whether

the respondent is liable for the

15

The Suits in Admiralty Act waives the government's sovereign

immunity:

[i]n cases where if [a United States] vessel were

privately owned or operated, or if [United States]

cargo were privately owned or possessed, or if a

private person or property were involved, a proceeding

in admiralty could be maintained, any appropriate

nonjury proceeding in personam may be brought against

the United States . . . .

Gordon v. Lykes Bros. Steamship Co., Inc., 835 F.2d 96, 98 (5th

Cir.), cert. denied, 488 U.S. 825 (1988) (citing 46 U.S.C. § 742

(1982)).

In effect, the Suits in Admiralty Act is a jurisdictional

statute providing for maintenance of admiralty suits against the

United States which encompasses all maritime torts alleged

against the United States. See id. at 98; United States v.

Continental Tuna Corp., 425 U.S. 164, 176 n.14 (1976).

consequential damages16 occasioned by the

failure to provide for maintenance and cure

after termination of the voyage when it was

demanded . . . .

We may regard it as settled law that if a

man is injured or becomes ill while on a

voyage, neglect to fulfill the duty to

provide maintenance and cure may impose

damages beyond mere cost of food and

medicines. The Iroquois, 194 U.S. 240, 24

S.Ct. 640, 48 L.Ed. 955 . . . .17

16

While the district court correctly classified Deisler's lost

wages and damages for his pain and suffering as compensatory

damages, an award of consequential damages would clearly

encompass these compensatory damages. Compensatory damages serve

to compensate for harm sustained by a party. Restatement

(Second) of Torts § 903 (1977). Consequential damages are merely

compensatory damages for harm that "does not flow directly and

immediately from the act of a party, but only some of the

consequences or results of such act." Black's Law Dictionary 390

(6th ed. 1990).

17

The Iroquois, 194 U.S. 240 (1904), first recognized the

principle that the shipowner can be held liable for the damages

resulting from neglect in the fulfillment of the duty to provide

maintenance and cure. There, plaintiff seaman sued the vessel in

rem to recover damages resulting from the master's failure to

provide him surgical treatment and care. The seaman fractured

two ribs and his right leg when he accidentally fell from the

main yard to the deck of the vessel. The master, with the aid of

the carpenter, set the leg in splints for five weeks, after which

the master found the leg to be in good condition and permitted

the seaman to walk about with the aid of a crutch. However,

after arriving at port it was found the bones of his leg were not

united and as a result his leg had to be amputated. Id. at 240-

241. In his suit, the seaman alleged that the master breached

the duty owed to him in failing to put into an intermediate port

and procure the proper surgical attention. The district court

entered a $3,000 judgment for the seaman which the court of

appeals subsequently affirmed.

On appeal, the Supreme Court first noted that it had

recently recognized the shipowner's duty to provide proper

medical treatment for a seaman who becomes ill or injured in The

Osceola. The Court ultimately held that the master had breached

his duty to the seaman by failing to put into an intermediate

port sooner. The Court further held that the fact that the

seaman did not request to be taken to an intermediate port was of

This Court has held that it is not enough

to give a sick man a hospital ticket. If he

is ill and penniless transportation to the

place of treatment must be provided . . . .

Sims, 186 F.2d at 973-74. This obligation is inherent in the

seaman's employment, but it is not limited by traditional

concepts of contract.

This obligation for maintenance and cure is

. . . "imposed by the law itself as one

annexed to the employment . . . . The duty .

. . is one annexed by law to a relation, and

annexed as an inseparable incident without

heed to any expression of the will of the

contracting parties." Cortes v. Baltimore

Insular Line, 287 U.S. 367, 371-72 (1932).

It is no more a contract than the obligation

of a husband to support his wife is one of

contract. Each arises out of a relationship

voluntarily entered into. But these duties

are imposed by the law as an incident to the

relationship, not a matter of contract. . . .

[T]herefore, . . . the usual rules of damages

for breach of contract to pay money are [not]

applicable. (emphasis added).18

(..continued)

no significance because the master was his legal guardian and had

a duty to look out for the safety and care of his seamen, whether

or not such a request was made. Id. at 247.

18

We have, however, limited the right to recover additional

damages when one is not injured on the open sea. See Graham v.

Alcoa S.S. Co., Inc., 201 F.2d 423, 425 (3d Cir, 1953) ("This is

not an action for failure to give proper medical care aboard

ship, however, so that the Iroquois and Cortes cases are not

precisely apposite. Plaintiff must sink or swim with the Sims

case."). Graham reasoned that consequential damages would not be

allowed where the injury did not occur at open sea unless the

sailor first informed the employer of the injury and requested

maintenance and cure. Here, as in Sims, Deisler did just that.

"In Sims, . . . we held the defendant liable for its failure to

supply maintenance and cure, but we limited liability to damages

for those consequences occurring after notice of defendant for

libellant's need of care and of his inability to procure it

Id. at 974. Although the court's analogy to the marital

relationship can not withstand the social evolution that has

occurred since the court spoke, the court's pronouncement of the

permissible recovery for failure to promptly provide maintenance

and cure remains valid. See also Neville v. American Barge Line

Co., 276 F.2d 117, 120 (3d Cir. 1960). There, a prior suit had

established that the plaintiff was entitled to maintenance and

cure up until December 4, 1951, and that plaintiff had not yet

reached the point of maximum cure. Id. at 118-19. Thereafter,

plaintiff instituted a second suit because no money had been paid

for maintenance and cure after December 4, 1951. In the second

action, plaintiff sought maintenance and cure, along with lost

wages and damages for pain and suffering. Id. at 119. The claim

for consequential damages was based upon plaintiff's assertion

that the failure to provide maintenance and cure prevented her

from obtaining psychiatric treatment, and had thus caused

additional suffering and loss of earnings. Id. at 120. A jury

awarded plaintiff maintenance and cure and lost wages as well as

damages for the pain and suffering that resulted from withholding

maintenance and cure. We reversed the award of consequential

damages because of insufficient proof of causation. However, we

(..continued)

because of indigence." Id. at 425. Here, the district court

concluded that Deisler's pain and suffering resulted from his

inability to afford necessary surgery. Findings of Fact, ¶ 31.

expressly reaffirmed the principle that consequential damages are

recoverable for the wrongful failure to provide maintenance and

cure. Id. (citing Sims, 186 F.2d at 975). The claim in Neville

was brought under general maritime law. Thus, consequential

damages for failure to pay maintenance and cure are not limited

to claims under the Jones Act. This is consistent with the

Supreme Court's decisions in Cortes and Vaughn, supra.

In Vaughn, plaintiff seaman had worked as a taxi driver

after becoming ill while in defendant's employ. The employer

refused to pay maintenance and cure because it doubted that

plaintiff had really been ill. "Ultimately [the employee] was

required to hire an attorney and sue in the courts to recover

maintenance and cure, agreeing to pay the lawyer a 50% contingent

fee." Vaughn, 369 U.S. at 529. The district court granted

maintenance and cure but ordered that the amount plaintiff had

earned as a taxi driver be deducted from the recovery. The court

further limited recovery to damages directly relating to the

employer's obligation to provide medical treatment for the

sailor. The court reasoned that plaintiff was not entitled to

attorney's fees, and could only recover damages which resulted

"when the failure to furnish maintenance and cure caused or

aggravated the illness or other physical or mental suffering."

Id. The court of appeals also denied counsel fees reasoning that

they are not recoverable in suits for breach of contract.

The Supreme Court disagreed on both points. The Court

reasoned that "[w]hile failure to give maintenance and cure may

give rise to a claim for damages for the suffering and for the

physical handicap which follows (The Iroquois, 194 U.S. 240, 24

S.Ct. 640, 48 L.Ed. 955), the recovery may also include

'necessary expenses.' Cortes v. Baltimore Insular Line, 287 U.S.

367, 371, 53 S.Ct. 173, 174, 77 L.Ed. 368." Id. at 530. The

Court reasoned that the shipowner's duty to provide maintenance

and cure "was among 'the most pervasive' of all and . . . not to

be defeated by restrictive distinctions nor 'narrowly confined.'

When there are ambiguities or doubts, they are resolved in favor

of the seaman." Id. at 532 (citations omitted). The Court also

rejected the ruling that wages earned as a cab driver should be

deducted from any recovery.

It would be a sorry day for seamen if

shipowners, knowing of the claim for

maintenance and cure, could disregard it,

force the disabled seaman to work, and then

evade part or all of their legal obligation

by having it reduced by the amount of the

sick man's earnings . . . . This result is

at war with the liberal attitude that

heretofore has obtained and with admiralty's

tender regard for seamen.

Id. at 533 (citing Yates v. Dann, 223 F.2d 64, 67 (3d Cir. 1955))

(if seaman is found to be still in need of maintenance and cure

the fact that the seaman is forced by financial necessity to

return to his regular employment will not serve as a bar to his

recovery).

We therefore disagree with McCormack's assertion that the

additional damages that Deisler seeks are limited to the Jones

Act. Brief of Appellant at 13-14. We believe that the district

court properly awarded Deisler lost wages, damages for pain and

suffering, and prejudgment interest arising from McCormack's

failure to pay him maintenance and cure.

McCormack further asserts that even where such additional

damages and expenses are awarded on a maintenance and cure claim,

they are allowed only where there is a willful and wrongful

refusal to pay maintenance and cure and that the record here does

not support the district court's conclusion that McCormack's

refusal to pay maintenance and cure was arbitrary or capricious.

As noted above, in Sims we held that consequential damages are

allowed in a claim for maintenance and cure in order to make the

injured seaman whole, and they are not dependent upon a showing

of bad faith. See Sims, 186 F.2d at 974. That holding was based

upon the analogous situation in tort law:

One man hurts another in an accident. The

actor fails to provide medical care or

alleviate the harm suffered by the victim

honestly thinking that he was not (1) himself

negligent or (2) the victim was

contributorily negligent. If the trier of

fact disagrees with the actor on these

conclusions, defendant is liable for full

damages suffered, although some of them could

have been mitigated by prompt action on his

part.

Id. at 974-75.

In Morales v. Garijak, 829 F.2d 1355, 1358 (5th Cir. 1987),

the court suggests that compensatory damages may not be recovered

unless the shipowner's refusal is unreasonable. However, we do

not need to address the specifics of this argument as this record

clearly supports a finding that McCormack's refusal was not

reasonable.

From the outset, the only reason offered for McCormack's

failure to pay maintenance and cure was the assertion that no

accident had occurred. During the trial, the district court

questioned Bernard Lillis, McCormack's Chief Financial Officer,

about McCormack's reason for denying Deisler's claim:

Lillis: If one person had come along and said

that they saw Mr. Deisler fall over the

wheelbarrow I would have changed my decision.

. . .

The Court: Mr. Lillis has made it very clear

that the reason maintenance and cure was

denied was because he didn't think the

accident ever happened. Isn't that right,

Mr. Lillis?

Mr. Lillis: That's right, your honor.

. . .

The Court: Let me pursue this. Is it your

position that the only reason that

maintenance and cure was denied was because

your company felt that an accident never

happened?

Mr. Lillis: That is true, your honor.

The Court: An accident of Mr. Deisler falling

over a wheelbarrow on June 15, 1989?

Mr. Lillis: That's correct.

The Court: That is it?

Mr. Lillis: That is it.

(emphasis added). Findings of Fact, ¶ 49 n.5, Suppl. App. at 45-

46.

However, McCormack never interviewed Deisler, and although

Melendez denied seeing Deisler fall he told Lamorte's

investigator that he saw Deisler "dusting himself off" after the

wheelbarrow incident. Suppl. App. at 169. In addition, Ellis

told Lamorte's investigator that he saw "the wheel barrow lying

on its side, the bags on the ground, and Deisler standing there

kicking his feet." Id. Rather than accept that testimony as

corroboration that Deisler had been injured, McCormack

tenaciously used it to support the rather dubious position that

no accident could have occurred because no one saw it. Finally,

McCormack disregarded their own investigators' recommendations

that they pay Deisler maintenance and cure. Although McCormack

was under no obligation to accept the recommendations of Lamorte

or American Maritime, the district court did not have to ignore

McCormack's rejection of its own expert's recommendation.

Similarly, the district court properly noted that

McCormack's reason for denying Deisler's claim shifted from

pillar to post as the case progressed.

Defendant's primary defense to the

maintenance and cure claim was that plaintiff

lied about an accident occurring. Second,

defendant contended that no injury occurred

even if the incident did. Third, defendant

contended that if plaintiff was suffering

from any condition, which it denied, it pre-

existed the date of the incident. Next,

defendant contended that even if an injury

occurred, it was fully resolved, and no

further medical care was necessary. Thus,

the presentation of plaintiff and Steve

Melendez as liability witnesses was

necessary. Plaintiff was required to move

for a new Jones Act trial because of

defendant's misrepresentations of material

facts.

Findings of Fact, ¶ 59. That assessment is supported by the

record.

It is now for McCormack, not Deisler, to bear the extra cost

occasioned by McCormack's intransigence. This includes the wages

Deisler would have been earning had McCormack met its obligation

to finance the corrective back surgery, and damages for the pain

and suffering he has endured while awaiting that surgery. See

Cortes, supra.

1. The Law of the Case

Nor does the law of the case preclude Deisler from

recovering consequential damages under general maritime law

despite the jury's Jones Act verdict in favor of defendants.

"The doctrine of the law of the case dictates that 'when a court

decides upon a rule of law, that rule should continue to govern

the same issues in subsequent stages in the litigation.'" In re

Resyn Corp., 945 F.2d 1279, 1281 (3d Cir. 1991) (quoting Devex

Corp. v. General Motors Corp., 857 F.2d 197, 199 (3d Cir. 1988));

see also Arizona v. California, 460 U.S. 605, 618 (1983)19;

Schultz v. Onan Corp., 737 F.2d 339, 345 (3d Cir. 1984) (the law

of the case doctrine applies "to issues that were actually

discussed by the court in the prior appeal [and] to issues

decided by necessary implication."). While the doctrine most

commonly serves to bar litigants from rearguing issues previously

decided on appeal, see CPC Int'l, Inc. v. Northbrook Excess &

Surplus Ins. Co., 46 F.3d 1211, 1215 (1st Cir. 1995); United

States v. Rivera-Martinez, 931 F.2d 148, 150 (1st Cir. 1991);

Schultz, 737 F.2d at 345, we have held that the dismissal of an

appeal terminates the cause of action and the judgment of the

district court becomes the law of the case. See Hook v. Hook &

Ackerman, 233 F.2d 180, 183 (3d Cir. 1956).20

19

"Unlike the more precise requirements of res judicata, law

of the case is an amorphous concept." 460 U.S. at 618.

20

The "[l]aw of the case directs a court's discretion, it

does not limit the tribunal's power." Schultz, 737 F.2d at 345

(citations omitted).

McCormack argues that since Deisler elected to dismiss the

Jones Act claim after trial the law of the case precludes

recovery of consequential damages under general maritime law.

That argument rests upon the mistaken belief that such lost wages

and damages for pain and suffering are incidents of negligence

under the Jones Act and not recoverable under the general

maritime law. As we explained above, such damages may be

recovered for the failure to provide maintenance and cure in the

absence of a Jones Act claim. Thus, the law of the case is not a

bar to plaintiff's recovery.

2. Prejudgment Interest.

The award of prejudgment interest was also proper. Unlike

attorney's fees and litigation expenses (which were not regarded

as part of the merits of judgment at common law) prejudgment

interest has traditionally been considered part of the

compensation due to a plaintiff. See Osterneck v. Ernst &

Whinney, 489 U.S. 169, 175 (1989). The Supreme Court has

repeatedly held that prejudgment interest is merely an element of

a plaintiff's complete compensation. See id.; West Virginia v.

United States, 479 U.S. 305, 310, & n.2 (1987). Interest must be

allowed if plaintiff is to be truly made whole for defendant's

breach of its duty to provide maintenance and cure. See Vaughn,

supra.

3. Attorney's Fees and Costs.

Attorney's fees and costs differ from interest, lost wages

and damages for pain and suffering because attorney's fees and

costs cannot be recovered unless plaintiff can first establish

defendant's bad faith or recalcitrance.

Recognizing the importance of a seaman's

right to be made whole through the recovery

of maintenance and cure, the federal courts

have fashioned a supplemental remedy for

instances in which a ship operator's

unjustified refusal to own up to its

responsibilities to furnish maintenance and

cure forces a seaman to incur the expense of

a lawsuit to collect that which is due. When

a ship operator fails to make a prompt, good

faith investigation of a seaman's claim for

maintenance and cure or otherwise takes a

"callous" or "recalcitrant" view of its

obligations, the seaman may recover legal

expenses on top of maintenance and cure. See

Vaughn, 369 U.S. at 530-531 . . . .

Rodriguez Alvarez v. Bahama Cruise Line, Inc., 898 F.2d 312, 316

(2d Cir. 1990).

However, as stated above, the record here fully supports the

district court's conclusion that McCormack's refusal to pay

Deisler maintenance and cure was arbitrary and capricious.

Accordingly, we will affirm the district court's award of

attorney's fees and costs.

C. Allocation of Fees and Costs

Alternatively, McCormack argues that even if the award of

attorney's fees and costs was proper, the district court acted

arbitrarily in allocating 90% of plaintiff's attorney's fees to

the general maritime claim and refusing to make an allocation of

costs between it and the Jones Act claims. The district court

candidly acknowledged that "[g]iven the overlapping evidence on

the Jones Act claim and the maintenance and cure claim, it is

difficult to separate out services attributable solely to the

unsuccessful Jones Act claim." Findings of Fact, ¶ 59.

Notwithstanding this caveat, the court held that based on its

"review of the record a fair estimate of counsel time expended in

attempting to prove defendant's negligence under the Jones Act is

10%." Id.

The district court must exercise its informed discretion in

awarding attorney's fees. Pawlak v. Greenawalt, 713 F.2d 972,

977 (3d Cir.), cert. denied, 464 U.S. 1042 (1984) (citation

omitted). Thus, our standard of review is a narrow one. "We can

find an abuse of discretion if no reasonable [person] would adopt

the district court's view. If reasonable [people] could differ

as to the propriety of the action taken by the trial court, then

it cannot be said that the trial court abused its discretion."

Silberman v. Bogle, 683 F.2d 62, 65 (3d Cir. 1982) (citation

omitted).

McCormack argues only that "[i]t is inconceivable that only

10% of fees are attributable to the Jones Act jury trial, in

which plaintiff unsuccessfully tried many issues not implicated

in the maintenance and cure claim." Presented with no more than

this assertion of "inconceivability," we cannot say that the

division of attorney's fees was an abuse of discretion. Although

the required division of fees is difficult, our review of the

record does not allow us to conclude that the district court

erred in slicing the pie as it did. Accordingly, we will affirm

the district court's allocation of the award of attorney's fees

and costs.

D. The Deposition of Charles Ellis

McCormack argues that it should have been allowed to

introduce the deposition of Captain Ellis under Federal Rule of

Civil Procedure 32(a)(3) as Ellis was more than 100 miles from

the place of trial, was no longer McCormack's employee, and thus

was unavailable within the meaning of that Rule. The district

court did not allow McCormack to use Ellis' deposition because it

found that Deisler took the deposition under the misapprehension

that Ellis had not witnessed any part of Deisler's accident. The

court reasoned that Deisler was therefore unlikely to have

focused upon Ellis' observations during the deposition.

Plaintiff's counsel's strategy during the

Ellis deposition was to avoid creating a

deposition record which could be used against

his client at trial in the event of Ellis's

unavailability at trial. This strategy is a

plausible response to defendant's misleading

answer to the interrogatory in question.

Findings of Fact, ¶ 12 n.2.

Even assuming the district court erred in excluding the

deposition, we believe that any error in this regard was

harmless. See McQueeney v. Wilmington Trust Co., 779 F.2d 916,

923-28 (3d Cir. 1985) (errors are harmless if it is highly

probable a party's substantial rights were not affected). The

excluded testimony adds little that is not contained in the

Lamorte report which the district court did consider. Ellis

testified at the deposition that Deisler told him that he

(Deisler) was not helping to off-load a cable from the bow of the

dredge because he had a bad back. App. at 193. The Lamorte

report states that after Ellis asked Deisler to help move some

cables Deisler informed Ellis of his bad back, but did not blame

it on any mishap with a wheelbarrow. Suppl. App. at 169.

Secondly, Ellis testified at the deposition that he saw Deisler

pushing the "wheelbarrow" but did not watch him perform the whole

job. App. at 195. Similarly, the Lamorte report states that

Ellis only saw "the wheelbarrow lying on its side, the bags lying

on the ground, and Deisler standing there kicking his feet."

Suppl. App. at 169. Finally, both the Lamorte report and the

deposition transcript state that Ellis did not learn of Deisler's

injury until after Deisler was fired. Suppl. App. at 168; App.

at 197.

Thus, any error in failing to admit Ellis' deposition was

harmless as the district court considered the same testimony by

way of the Lamorte report.

E. Challenges to the District Court's Findings of Fact

McCormack also challenges a series of factual findings, all

of which are supported by the record. We therefore find these

challenges to the district court's findings of fact to be lacking

in merit.

First, McCormack claims that the district court erred in

finding that plaintiff suffered a job related injury because the

finding was based upon an erroneous belief that Ellis had

witnessed the accident. There is ample evidence to support the

district court's finding that Ellis witnessed the accident.

Melendez testified that Ellis observed the event and exclaimed:

"Oh, look, he fell. He busted his a...," as he watched. In

addition, both Deisler and Melendez testified that the accident

occurred.

Second, McCormack claims that the district court erred in

finding that plaintiff's accident and his reports of it occurred

before plaintiff was notified that he had been fired. Deisler

testified that he reported the accident to both Melendez and

Ellis before he was fired and that he was filling out the

accident report when he was given his dismissal notice. Melendez

corroborated part of that testimony. There was testimony that

Deisler completed the accident report on June 16, and thereafter

had his own doctor fill out and return a New Jersey Disability

Form.

McCormack also argues that the testimony of Brad Simek and

William Daniel contradict the district court's findings. Simek

inferred no accident had occurred because any accident should

have been reported to him, and none was. Daniel testified that

Deisler reported the accident to him after Deisler had been

terminated. Regardless of when, if ever, Deisler told Simek or

Daniel of his accident, the evidence that Deisler told Ellis and

Melendez of his injury prior to being terminated supports the

district court's finding.

Third, McCormack argues that the district court erred in

finding that the investigation of Deisler's claim was not

conducted in good faith. McCormack claims that the court based

this finding upon an equally erroneous finding -- namely, that

the only reason McCormack did not pay maintenance and cure was

that it believed that no accident occurred and that the medical

evidence supporting Deisler's claim was ignored.

We previously detailed the abundance of evidence supporting

the district court's finding that McCormack did not rely on

Deisler's pre-existing medical condition either in hiring him or

in its decision not to pay maintenance and cure. Moreover, the

record supports a finding that all of the evidence which tended

to corroborate Deisler's claim was ignored by McCormack.

Finally, McCormack argues that the district court erred in

finding that Deisler will reach maximum medical improvement

approximately four months after surgery. McCormack claims that

Deisler admitted in his trial testimony that his doctors told him

toward the end of 1989 that his medical condition would not

improve. Brief of Appellant at 25. McCormack claims that the

end of 1989, rather than four months after surgery, is the point

of "maximum cure." However, McCormack's position is based upon

an incomplete recitation of Deisler's testimony. Deisler

testified that his doctors told him his condition would not

improve without surgery.21

III. CONCLUSION

For the reasons stated above we find that McCormack's

arguments are without merit. Accordingly, the judgment of the

district court will be affirmed.22

21

Defendants failed to include the following testimony in

their brief:

Q. Did Dr. Molzen tell you that surgery

would improve your condition?

A. That is a tricky question. Dr. Molzen

recommended surgery for me, yes. Yes, it

would improve my condition. There is also a

threat that it will not be successful, but

yes it would help.

Q. Dr. Gott, did he tell you that surgery

would improve your condition?

A. Yes, he did.

Q. But they also told you that there were risks

involved.

A. Absolutely.

Q. Is that why you hesitated?

A. Yes.

Suppl. App. at 20.

22

We will also grant Deisler's motion for reimbursement of the

costs associated with Deisler's submission of a Supplemental

Appendix. The Appendix filed by McCormack was inadequate and the

editing of the testimony of Melendez and Deisler was so selective

as to be misleading. Deisler therefore had to file the

Supplemental Appendix to clarify the record.