Guevara v. Maritime Overseas Corp.

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

_____________________

No. 92-4711

_____________________

DOMINGO GUEVARA,

Plaintiff-Appellee,

v.

MARITIME OVERSEAS CORPORATION,

Defendant-Appellant.

_________________________________________________________________

Appeal from the United States District Court

for the Eastern District of Texas

_________________________________________________________________

(July 26, 1995)

Before POLITZ, Chief Judge, GOLDBERG,* KING, GARWOOD, JOLLY,

HIGGINBOTHAM, DAVIS, JONES, SMITH, DUHÉ, WIENER, BARKSDALE,

EMILIO M. GARZA, DeMOSS, BENAVIDES, STEWART, and PARKER, Circuit

Judges.

KING, Circuit Judge:

We reheard this case en banc to reconsider our 1984 decision

in Holmes v. J. Ray McDermott & Co., 734 F.2d 1110 (5th Cir. 1984),

that an award of punitive damages under the general maritime law

may be made when an employer willfully and callously refuses to pay

maintenance or cure to an injured seaman. Developments in the law

*

Judge Irving L. Goldberg was a member of the panel that

initially decided this case and he heard oral argument before the

en banc court. Judge Goldberg died on February 11, 1995, before

this decision was rendered.

since 1984 have caused us to reevaluate the basis for such a

punitive award and to conclude that Holmes should be overruled.

I. FACTUAL AND PROCEDURAL BACKGROUND

The facts and procedural history of this case are set forth in

the panel opinion, Guevara v. Maritime Overseas Corp., 34 F.3d 1279

(5th Cir.), reh'g en banc granted, 34 F.3d 1290 (5th Cir. 1994),

but we summarize them here for the reader's convenience.

Domingo Guevara was injured on May 29, 1990 while serving as

a crewmember on the vessel Overseas Philadelphia. The vessel was

owned and operated by Guevara's employer, Maritime Overseas

Corporation ("Maritime"). The crew was preparing the ship to sail

from Freeport, Texas, and Guevara was helping to secure the

gangway. Because of the gangway's size, the ship's crane was used

to lift it, and the task was being performed in the midst of

considerable wind and rain.

Guevara was standing on a catwalk on the vessel pursuant to

the orders of his superior, the vessel's bosun, who was operating

the crane. As the gangway was lifted, it swayed in Guevara's

direction, and the bosun ordered Guevara to move away from where he

was standing. When Guevara tried to move, however, he momentarily

caught the tread of his boot in the catwalk grating. After freeing

himself, Guevara jumped from the catwalk to the deck below to avoid

being hit by the gangway.

Unfortunately, Guevara injured his knee while falling to the

deck. He promptly reported his injury to the third mate and he was

given assistance. Despite his injury, Guevara continued to work on

2

the vessel for a period of four months, apparently to qualify for

union benefits. Upon the vessel's return to port, Guevara saw a

doctor who diagnosed him as having a torn medial meniscus and a

torn anterior cruciate ligament. Although Guevara was initially

reluctant to undergo surgery, his knee was operated on in February

of 1991. Beginning on February 5, 1991, Guevara made a number of

formal demands on Maritime for maintenance and cure. Maritime,

however, made no payment until June 24, 1991 at the earliest.

Despite subsequent demands, Guevara did not receive his second and

final payment until December 29, 1991.

Guevara brought a negligence claim under the Jones Act and an

unseaworthiness claim under the general maritime law against

Maritime. Guevara also sought punitive damages for Maritime's

failure to pay maintenance on a timely basis. The jury returned a

verdict for Guevara, finding Maritime negligent, the Overseas

Philadelphia unseaworthy, and Guevara not negligent. Further, the

jury awarded Guevara $131,000 in compensatory damages for his

injury and $60,000 in punitive damages for Maritime's arbitrary and

capricious failure to pay maintenance.1 Maritime now appeals.

1

The $60,000 punitive award was based upon the jury's

affirmative response to the question "Do you find that the

defendant, Maritime Overseas Corporation, arbitrarily and

capriciously failed to provide maintenance to the plaintiff,

Dom[i]ngo Guevara on a timely basis?" The jury was then asked,

"[W]hat sum of money do you find from a preponderance of the

evidence should be awarded to the plaintiff as punitive damages,

as that term has been defined in this charge?" The jury was not

asked to award attorney's fees or compensatory damages on account

of Maritime's failure to pay maintenance.

3

In this opinion, we only address the question of whether

punitive damages are still available in maintenance and cure cases.

As a consequence, the portions of the panel opinion addressing the

jury's finding of negligence (Part IIA), see Guevara, 34 F.3d at

1281-82, and the jury's finding of Maritime's arbitrary and

capricious behavior (Part IIB), see id. at 1282-83, are reinstated.

II. ANALYSIS AND DISCUSSION

A. The Doctrine of Maintenance and Cure

When a seaman becomes ill or injured while in the service of

his ship, the shipowner must pay him maintenance and cure

regardless of whether the shipowner was at fault or whether the

ship was unseaworthy. See Morales v. Garijak, Inc., 829 F.2d 1355,

1358 (5th Cir. 1987). "Maintenance" is the right of a seaman to

food and lodging if he falls ill or becomes injured while in the

service of the ship. "Cure" is the right to necessary medical

services. This duty to pay maintenance and cure is of ancient

vintage, and its origin is customarily traced back to the medieval

sea codes. See The Osceola, 189 U.S. 158, 169 (1903); see

generally Grant Gilmore & Charles L. Black, Jr., The Law of

Admiralty § 6-6, at 281 (2d ed. 1975); Thomas J. Schoenbaum,

Admiralty and Maritime Law § 6-28, at 348 (2d ed. 1994). Only

"seamen" can assert the right to maintenance and cure, but the

legal test for seaman status in maintenance and cure actions is the

same as the inquiry for standing under the Jones Act. See, e.g.,

Hall v. Diamond M Co., 732 F.2d 1246, 1248 (5th Cir. 1984) ("The

standard for determining seaman status for the purposes of

4

maintenance and cure is the same as that established for

determining status under the Jones Act.").

In the United States, the doctrine of maintenance and cure

appears to have been recognized by Justice Story in two cases which

he decided while riding on circuit. See Harden v. Gordon, 11 F.

Cas. 480 (C.C.D. Me. 1823) (No. 6,047); Reed v. Canfield, 20 F.

Cas. 426 (C.C.D. Mass. 1842) (No. 11,641). These cases generally

explain the seaman's right to maintenance and cure partly on

humanitarian grounds and partly on economic grounds. As Gilmore

and Black write:

The doctrine not only protected the childlike and

improvident seaman (who is usually "poor and friendless"

and apt to acquire "habits of gross indulgence,

carelessness and improvidence"), but served "the great

public policy of preserving this important class of

citizens for the commercial service and maritime defence

of the nation." Even the shipowners derived an ultimate

benefit from being made to assume these charges, since,

as Story shrewdly pointed out, seamen were thereby

encouraged "to engage in perilous voyages with more

promptitude, and at lower wages."

Gilmore & Black, supra, § 6-6, at 281 (quoting Harden v. Gordon, 11

F. Cas. 480 (C.C.D. Me. 1823) (Case No. 6,047)) (footnote omitted).

This obligation to provide maintenance and cure "embraces not only

the obligation to pay a subsistence allowance and to reimburse the

seaman for medical expenses he incurs; the employer must take all

reasonable steps to insure that the seaman who is injured or ill

receives proper care and treatment." Schoenbaum, supra, § 6-28, at

348; see also Morales, 829 F.2d at 1358.

B. Legal Developments and their Effect on

Holmes v. J. Ray McDermott

5

Until 1984, we had never upheld an award of punitive damages

for the willful nonpayment of maintenance and cure. In our 1984

Holmes opinion, however, we did uphold such a punitive award, and

we supported the award with the following analysis:

In Vaughan v. Atkinson, 369 U.S. 527 (1962), the Supreme

Court held that an employer's willful and arbitrary

refusal to pay maintenance and cure gives rise to a claim

for damages in the form of attorneys' fees in addition to

the claim for general damages. Subsequent decisions have

established that, in addition to such attorneys' fees,

punitive damages for such refusal are available under the

general maritime law. See Complaint of Merry Shipping,

Inc., 650 F.2d 622, 625 (5th Cir. 1981) (collecting

cases); see also Robinson v. Pocahontas, Inc., 477 F.2d

1048 (1st Cir. 1973).

734 F.2d at 1118 (citations omitted). Thus, at the time of our

Holmes decision, we relied upon three cases -- the Supreme Court's

Vaughan, this court's Merry Shipping, and the First Circuit's

Pocahontas -- and there was not a great deal of additional guidance

to be found. Judge Garwood's well-considered concurrence to the

panel opinion, see Guevara, 34 F.3d at 1284-90 (Garwood, J.,

concurring), together with significant developments in the law of

admiralty and elsewhere, have caused us to rethink our position.

We begin, therefore, by reexamining the precedents that form the

foundation of our Holmes opinion, and in the end, we conclude that

Holmes's approval of punitive damages is no longer justifiable in

cases of willful nonpayment of maintenance and cure.

1. Vaughan v. Atkinson

In Holmes, we cited Vaughan v. Atkinson, 369 U.S. 527 (1962),

only for the proposition that a willful and arbitrary failure to

pay maintenance and cure gave rise to a claim for attorney's fees

6

as well as general damages. See 734 F.2d at 1118. We did not cite

Vaughan as an example of the Supreme Court's approval of punitive

damage awards in the maintenance and cure context; indeed, we

explicitly noted that it was "subsequent decisions" that made

punitive damages available. See id. Nevertheless, it is possible

that Vaughan, while only upholding an award of attorney's fees,

announced a principle broader than its result. Thus, we now

attempt to determine how broad this principle is.

Vaughan, a brief opinion by Justice Douglas, is a difficult

decision -- not because of its holding, but because of the

rationale for its holding. It is clear that the majority in

Vaughan upheld an award of attorney's fees to a seaman where his

employer had deliberately withheld payment of maintenance and cure.

See Vaughan, 369 U.S. at 529-31. The difficulty, however, stems

from the theory on which the majority awarded the attorney's fees.

On the one hand, the adjectives used by the majority to

describe the employer's behavior -- "callous," "recalcitran[t],"

"willful and persistent" -- imply that the award of attorney's fees

was meant to be a punitive sanction. See id. at 530-31. On the

other hand, the majority cited Cortes v. Baltimore Insular Line,

287 U.S. 367, 371 (1932), for the proposition that an employer's

failure to pay maintenance and cure may entitle a seaman to the

recovery of "necessary expenses." The Court further stated that

the seaman "was forced to hire a lawyer to get what was plainly

owed him," and the Court noted that "[i]t is difficult to imagine

a clearer case of damages suffered for failure to pay maintenance

7

than this one." Vaughan, 369 U.S. at 531. This terminology

clearly suggests that the attorney's fees were meant as a

compensatory award for out-of-pocket expenses, as punitive damages

are not "owed" as "expenses" and are not designed to remedy

"damages suffered." Indeed, the language of the dissent implies

that the majority's rationale for the attorney's fees award was

compensatory, while the dissent believed that the rationale should

be punitive:

Cortes [, cited by the majority, ] dealt with

compensatory damages for a physical injury, and the

opinion in that case contains nothing to indicate a

departure from the well-established rule that counsel

fees may not be recovered as compensatory damages.

. . .

However, if the shipowner's refusal to pay maintenance

stemmed from a wanton and intentional disregard of the

legal rights of the seaman, the latter would be entitled

to exemplary damages in accord with traditional concepts

of the law of damages. While the amount so awarded would

be in the discretion of the fact finder, and would not

necessarily be measured by the amount of counsel fees,

indirect compensation for such expenditures might thus be

made.

8

Id. at 540 (Stewart, J., dissenting) (citation omitted).2 Because

of this difficulty stemming from the Vaughan rationale, it is not

surprising that commentators are divided as to whether the

attorney's fees award was intended to be compensatory or punitive

in nature. Compare 6 James Wm. Moore, Moore's Federal Practice ¶

54.78[3], at 54-503 to -504 & n.29 (2d ed. 1994) ("The [Vaughan]

court found that when a seaman's employer refused to pay the seaman

maintenance that `was plainly owed under laws that are centuries

old,' thus forcing the seaman to retain counsel and sue for it, the

expenses of the suit could rightly be treated as part of the

compensatory damage.") with Gilmore & Black, supra, § 6-13, at 313

(noting that Vaughan "awarded what were essentially punitive

damages under the name of counsel fees").3

2

Indeed, on remand from the Supreme Court, the district

court in Vaughan stated the following:

As this court interprets the language of the Supreme

Court, the intent and purpose of the same is that the

trial court should make the seaman "whole", i.e., he

should not be required to pay money out of his pocket

to collect maintenance lawfully due to him. To

accomplish this fact, the respondents are required to

pay, by way of damages, a reasonable attorney's fee to

libellant's proctor for prosecuting the proceedings

made necessary to collect the seaman's maintenance

claim.

. . .

We do not read the majority opinion of the Supreme

Court as suggesting that punitive damages are in order.

Vaughan v. Atkinson, 206 F. Supp. 575, 576 (E.D. Va. 1962).

3

Surprisingly, Guevara does not argue that Vaughan

supports the award of punitive damages in maintenance and cure

cases. According to Guevara, the punitive damages issue was not

before the Court in Vaughan -- "[t]he seaman had not pled for

punitive damages and the Court did not award punitive damages."

Instead, as Guevara contends, "[t]he Court awarded exactly what

9

Fortunately, in deciphering Vaughan, we are aided by seven

subsequent Supreme Court cases that have cited the opinion.4 In

all seven cases, the Court has treated Vaughan as supporting an

exception to the "American Rule" that litigants generally must bear

their own costs. In the 1967 Maier Brewing case, the Court read

Vaughan as establishing a compensatory basis for fee-shifting:

Limited exceptions to the American rule . . . have been

sanctioned by this Court when overriding considerations

of justice seemed to compel such a result. In

appropriate circumstances, we have held, an admiralty

plaintiff may be awarded counsel fees as an item of

compensatory damages (not as a separate cost to be

taxed). Vaughan v. Atkinson, 369 U.S. 527 (1962).

the Plaintiff pled for, attorney fees incurred as a necessary

expense in having to go to court . . . ." See also Hines v. J.A.

LaPorte, Inc., 820 F.2d 1187, 1189 (11th Cir. 1987) ("Vaughan is

not dispositive because in that case only a claim for attorney's

fees was asserted, not separate claims for both fees and punitive

damages.").

Similarly, Maritime argues that the language used in Vaughan

"clearly shows that the Supreme Court awarded compensatory

damages, not punitive damages," but, contrary to Guevara's

position, Maritime also contends that the issue of punitive

damages was before the Court in Vaughan and was clearly rejected

by the majority. In support, Maritime cites the language of the

dissent and states that "[t]he dissent's discussion of exemplary

damages shows that the issue of punitive damages was before the

Court. The clear majority, however, rejected such [a theory] . .

. ." As mentioned, even though Guevara does not explicitly rely

on Vaughan for his overall contention that punitive damages are

available, Guevara does rely on Holmes. Because the instant case

provides us with an opportunity to reexamine our position in

Holmes, we find it prudent to determine whether Vaughan announced

a broader principle in support of punitive awards in maintenance

and cure cases.

4

See Summit Valley Indus., Inc. v. Local 112, 456 U.S.

717 (1982); Roadway Express, Inc. v. Piper, 447 U.S. 752 (1980);

Runyon v. McCrary, 427 U.S. 160 (1976); Alyeska Pipeline Serv.

Co. v. Wilderness Soc'y, 421 U.S. 240 (1975); F.D. Rich Co. v.

United States, 417 U.S. 116 (1974); Hall v. Cole, 412 U.S. 1

(1973); Fleischmann Distilling Corp. v. Maier Brewing Co., 386

U.S. 714 (1967).

10

386 U.S. at 718 (emphasis added) (footnote omitted). Since Maier

Brewing, however, Vaughan has come to stand for the proposition

that attorney's fees can be awarded to a prevailing party when his

opponent has engaged in bad-faith conduct during litigation. See

Shimman v. International Union of Operating Eng'rs, 744 F.2d 1226,

1229-30 (6th Cir. 1984) (tracing the citation history of Vaughan),

cert. denied, 469 U.S. 1215 (1985). In fact, Vaughan is often

cited as a foundational case for this "bad-faith" exception to the

American Rule. See Summit Valley, 456 U.S. at 721; Hall, 412 U.S.

at 5; Shimman, 744 F.2d at 1230.

Our knowledge that Vaughan is later cited as a foundation of

the bad-faith exception to the American Rule, however, does not

tell us whether this type of fee-shifting is compensatory or

punitive in nature. In Hall v. Cole, the Court made the following

observation:

Thus, it is unquestioned that a federal court may award

counsel fees to a successful party when his opponent has

acted in bad faith, vexatiously, wantonly, or for

oppressive reasons. In this class of cases, the

underlying rationale of `fee-shifting' is, of course,

punitive, and the essential element in triggering the

award of fees is therefore the existence of `bad faith'

on the part of the unsuccessful litigant.

412 U.S. at 5 (emphasis added) (citations omitted) (internal

quotation omitted). Hall's reasoning was reaffirmed in the recent

case of Chambers v. NASCO, Inc., 501 U.S. 32 (1991). Quoting Hall,

the Chambers Court noted that "in the case of the bad-faith

exception to the American Rule, `the underlying rationale of `fee-

shifting' is, of course, punitive.'" Id. at 53.

11

A careful reading of Chambers, however, belies the view that

awards made under the bad-faith exception to the American Rule are

"punitive damages" in the sense that they punish the conduct giving

rise to a plaintiff's claim. The Chambers Court distinguished

between fees awarded pursuant to the bad-faith exception, which are

based upon a federal court's inherent power to sanction parties for

their litigation behavior, see id. at 47, and other "fee-shifting

rules that embody a substantive policy, such as a statute which

permits a prevailing party in certain classes of litigation to

recover fees." Id. at 52. In other words, as the Court explained,

"the imposition of sanctions under the bad-faith exception depends

not on which party wins the lawsuit, but on how the parties conduct

themselves during the litigation." Id. at 53 (emphasis added).

While the Chambers majority expressed no opinion on the

question of whether a federal court has the inherent power to

impose sanctions for conduct giving rise to an underlying claim,

rather than for bad-faith conduct during the litigation process,

see id. at 54 n.16, four justices were firmly of the view that bad-

faith fee-shifting may not be used to sanction pre-litigation

conduct. Justice Scalia noted that the American Rule "prevents a

court (without statutory authorization) from engaging in what might

be termed substantive fee shifting, that is, fee shifting as part

of the merits award. It does not in principle bar fee shifting as

a sanction for procedural abuse." Id. at 59 (Scalia, J.,

dissenting). Similarly, Justice Kennedy, joined by Chief Justice

Rehnquist and Justice Souter, made the following observation:

12

[I]t is impermissible to allow a District Court acting

pursuant to its inherent authority to sanction such

prelitigation primary conduct. A court's inherent

authority extends only to remedy abuses of the judicial

process. By contrast, awarding damages for a violation

of a legal norm, [such as] the binding obligation of a

legal contract, is a matter of substantive law . . . .

[The] bad-faith exception permits fee shifting as a

sanction to the extent necessary to protect the judicial

process. . . . When a federal court, through invocation

of its inherent powers, sanctions a party for bad-faith

prelitigation conduct, it goes well beyond the exception

to the American Rule . . . .

Id. at 74 (Kennedy, J., dissenting).

The upshot of this extended discussion is that the bad-faith

exception to the American rule, of which the Vaughan award is cited

as an example, is not a punitive award in the "tort" sense of

punishing the underlying conduct that gives rise to a plaintiff's

claim. Tort-like punitive damages are awarded on the basis of the

merits of a case, while bad-faith fee-shifting punishes abuses of

the litigation process.

In the end, we need not definitely resolve whether Vaughan

awarded attorney's fees as an item of compensatory or punitive

damages. The award clearly has a "make-whole" compensatory aspect,

see Maier Brewing, 386 U.S. at 718, and, based upon the facts of

Vaughan, the award also has a punitive aspect to the extent that it

punished an abuse of the litigation process. See, e.g., Chambers,

501 U.S. at 52-53; Shimman, 744 F.2d at 1230-32. According to the

case law, however, the punitive aspect of the Vaughan award is the

bad-faith exception to the American Rule, and that exception is

limited to a recovery of attorney's fees. The Vaughan award was

clearly not a punitive damages award in the tort sense of punishing

13

the underlying conduct that gave rise to the litigation, and the

developing case law does not support such a position.

Simply put, all we can confidently say about Vaughan is that

it entitles an injured seaman to recover attorney's fees -- perhaps

as part of compensatory damages -- when his employer willfully

fails to pay maintenance and cure. We cannot definitively

conclude, however, that Vaughan establishes any broader principle

to support Holmes's rule that tort-like punitive damages, not

limited to attorney's fees, are available in cases of willful

nonpayment of maintenance and cure.

2. Dyer v. Merry Shipping Co.

In Dyer v. Merry Shipping Co., 650 F.2d 622, 623 (5th Cir.

Unit B July 1981), the widow of a deceased seaman brought a

wrongful death cause of action based upon the Jones Act and the

unseaworthiness doctrine of the general maritime law. The primary

issue on appeal was whether "punitive damages [could] be recovered

in a seaman's action brought under either general maritime law or

the Jones Act, or both." Id. We did not answer the Jones Act

question, noting that "[t]he district court may well be correct

that punitive damages may not be recovered in this Circuit under

the Jones Act, although we need not decide the issue at this time."

Id. at 626. As to the general maritime action, however, we

concluded that "in this Circuit punitive damages may be recovered

under general maritime law upon a showing of willful and wanton

misconduct by the shipowner." Id. Consequently, we reversed the

14

district court's dismissal of the plaintiff's claim for punitive

damages. See id. at 626-27.5

Because Merry Shipping was an earlier panel opinion, we were

bound by its holding in Holmes. Indeed, even though Merry Shipping

dealt with punitive damages in an unseaworthiness context, the

analysis, which we will soon discuss, was wholly applicable to

maintenance and cure cases as well, and the court concluded with a

broader declaration: "in this Circuit punitive damages may be

recovered under general maritime law . . . ." (emphasis added).

The law, of course, is constantly developing, and with the 1990

decision of the Supreme Court in Miles v. Apex Marine Corp., 498

U.S. 19 (1990), the analysis that we relied upon in Merry Shipping

has been significantly undermined.

In reaching our holding in Merry Shipping -- that punitive

damages are available in a wrongful death action brought by the

representative of a seaman under the unseaworthiness doctrine of

the general maritime law -- we relied upon a key proposition: "It

does not follow . . . that if punitive damages are not allowed

under the Jones Act, they should also not be allowed under general

maritime law." Merry Shipping, 650 F.2d at 626. To understand why

we now view this proposition as problematic, an examination of the

Miles analysis is necessary.

5

The district court dismissed Dyer's claim for punitive

damages on the ground that as a matter of law, such damages were

not recoverable under either the Jones Act or the general

maritime law. The court expressly declined to determine whether

the facts of the case could give rise to punitive damages, if

such damages were available. See Merry Shipping, 650 F.2d at

623.

15

a. Miles v. Apex Marine Corp.

In Miles, the parents of a seaman killed by a fellow crew

member ultimately recovered under the Jones Act for the negligence

of the ship's operators, charterer, and owner, as well as under the

general maritime law on the basis that the ship was unseaworthy as

a matter of law. See 498 U.S. at 21-22. The unseaworthiness

ruling presented two questions concerning the scope of damages

under the general maritime law: 1) whether a nondependent parent

could recover for loss of society in a general maritime wrongful

death action, and 2) whether the general maritime law permits a

survival action for the decedent's lost future earnings. See id.

at 22-23. A unanimous Court held that although the wrongful death

of a seaman is actionable under the general maritime law, damages

recoverable in such actions do not include loss of society. See

id. at 33. The Court also held that a general maritime survival

action cannot include recovery for the decedent's lost future

earnings. See id. at 36.

The Miles Court began by thoroughly describing Moragne v.

States Marine Lines, 398 U.S. 375 (1970), in which the Court

overruled its prior decision in The Harrisburg, 119 U.S. 199

(1886), to create a general maritime wrongful death cause of action

applicable in all waters. The Moragne Court's decision was driven

by two complementary rationales: consistency of the general

maritime law with the policy implemented in the Jones Act and in

the Death on the High Seas Act ("DOHSA") favoring wrongful death

recovery, and "the constitutionally based principle that federal

16

admiralty law should be `a system of law coextensive with, and

operating uniformly in, the whole country.'" Moragne, 398 U.S. at

402 (quoting The Lottawanna, 88 U.S. (21 Wall.) 558, 575 (1874)).

The Miles Court noted that Moragne "exemplifies the

fundamental principles that guide our decision in this case":

[i]n this era, an admiralty court should look primarily

to these legislative enactments for policy guidance. We

may supplement these statutory remedies where doing so

would achieve the uniform vindication of such policies

consistent with our constitutional mandate, but we must

also keep strictly within the limits imposed by Congress.

Congress retains superior authority in these matters, and

an admiralty court must be vigilant not to overstep the

well-considered boundaries imposed by federal

legislation. These statutes both direct and delimit our

actions.

498 U.S. at 27 (emphasis added). The Court noted that Moragne did

not set forth the scope of recoverable damages under the maritime

wrongful death action; thus, the Court sought guidance from

comparable federal statutes.

Starting with DOHSA, the Court observed that the statute, by

its explicit terms, prohibited the recovery of nonpecuniary

damages. Miles, 498 U.S. at 31; see Mobil Oil Corp. v.

Higginbotham, 436 U.S. 618, 622-24 (1978). Responding to the

contention that admiralty courts have traditionally undertaken to

supplement maritime statutes, the Miles Court stated:

Congress has spoken directly to the question of

recoverable damages on the high seas, and "when it does

speak directly to a question, the courts are not free to

`supplement' Congress' answer so thoroughly that the Act

becomes meaningless." Moragne involved gap filling in an

area left open by statute; supplementation was entirely

appropriate. But in an "area covered by the statute, it

would be no more appropriate to prescribe a different

measure of damages than to prescribe a different statute

of limitations, or a different class of beneficiaries."

17

Id. at 31 (quoting Higginbotham, 436 U.S. at 625) (citation

omitted).

Turning to the Jones Act, the Court observed that a well-

established pecuniary limitation on damages existed under the

Federal Employers' Liability Act ("FELA") at the time of the

enactment of the Jones Act.6 The Court noted that by

"incorporating FELA unaltered into the Jones Act, Congress must

have intended to incorporate the pecuniary limitation on damages as

well." Id. at 32. Even though a general maritime unseaworthiness

action, rather than a Jones Act action, was at issue in Miles, the

Court stated that "[i]t would be inconsistent with our place in the

constitutional scheme were we to sanction more expansive remedies

in a judicially created cause of action in which liability is

without fault than Congress has allowed in cases of death resulting

from negligence." Id. at 32-33. The Court concluded that "there

is no recovery for loss of society in a general maritime action for

the wrongful death of a Jones Act seaman," and the Court noted that

"[t]oday we restore a uniform rule applicable to all actions for

the wrongful death of a seaman, whether under DOHSA, the Jones Act,

or general maritime law." Id. at 33 (emphasis added).

6

The Miles Court explained that this pecuniary

limitation on damages stemmed from the Court's decision in

Michigan Central Railroad Co. v. Vreeland, 227 U.S. 59 (1913).

In Vreeland, the Court explained that the language of the FELA

wrongful death provision was essentially identical to that of

Lord Campbell's Act -- the first wrongful death statute. Lord

Campbell's Act and the many state statutes that followed it had

consistently been interpreted to provide recovery only for

pecuniary loss; thus, the Vreeland Court construed FELA in the

same manner. See Vreeland, 227 U.S. at 69-71.

18

The Court then addressed the second question: "whether, in a

general maritime action surviving the death of a seaman, the estate

can recover decedent's lost future earnings." Id. The Court noted

that recognizing a right to recover lost future income in a

survival action would be a "distinctly minority view," but the

Court stated that "[t]his fact alone would not necessarily deter

us, if recovery of lost future income were more consistent with the

general principles of maritime tort law." Id. at 35. The Court

cited "strong policy arguments for allowing such recovery,"

including economic incentives and solicitude to seamen, id. at 35-

36, but the Court's decision was driven by the analytical framework

that it had previously used:

We sail in occupied waters. Maritime tort law is now

dominated by federal statute, and we are not free to

expand remedies at will simply because it might work to

the benefit of seamen and those dependent upon them.

Congress has placed limits on recovery in survival

actions that we cannot exceed. Because this case

involves the death of a seaman, we must look to the Jones

Act.

The Jones Act/FELA survival provision limits recovery to

losses suffered during the decedent's lifetime. This was

the established rule under FELA when Congress passed the

Jones Act, incorporating FELA, and it is the rule under

the Jones Act. Congress has limited the survival right

for seaman's injuries resulting from negligence. As with

loss of society in wrongful death actions, this

forecloses more expansive remedies in a general maritime

action founded on strict liability. . . . Because [the]

estate cannot recover for his lost future income under

the Jones Act, it cannot do so under general maritime

law.

Id. at 36 (citations omitted).

The analytical framework of Miles governs our approach to

deciding damages issues in general maritime actions. In order to

19

decide whether (and how) Miles applies to a case, a court must

first evaluate the factual setting of the case and determine what

statutory remedial measures, if any, apply in that context. If the

situation is covered by a statute like the Jones Act or DOHSA, and

the statute informs and limits the available damages, the statute

directs and delimits the recovery available under the general

maritime law as well. The general maritime law will not expand the

available damages when Congress has spoken to the relief it deems

appropriate or inappropriate. See Anderson v. Texaco, Inc., 797 F.

Supp. 531, 536 (E.D. La. 1992).

The factual setting in Miles nicely exemplifies this approach.

Miles involved a seaman in a factual setting of wrongful death, and

the wrongful death of a seaman is covered by the Jones Act. Thus,

even though the plaintiff also sued for wrongful death under the

general maritime law, the factual setting was still the wrongful

death of a seaman, and Miles compels damages uniformity with the

statutory schemes that cover the same factual circumstances. Cf.

Miles, 498 U.S. at 36 ("Congress has placed limits on recovery in

survival actions that we cannot exceed. Because this case involves

the death of a seaman, we must look to the Jones Act." (emphasis

added)). The Jones Act prohibits non-pecuniary recovery; thus, the

Miles Court found that the general maritime unseaworthiness action

for the wrongful death of a seaman must have a similar prohibition

against non-pecuniary awards. Although the Miles Court did not

20

mention punitive damages, they are also rightfully classified as

non-pecuniary.7

Taking the analysis one step further, it should be clear that

actions under the general maritime law for personal injury are also

subject to the Miles uniformity principle, as non-fatal actions for

personal injury to a seaman are covered by statute -- i.e., the

Jones Act.8 Thus, many courts have extended Miles's logic to

prohibit the recovery of certain damages in personal injury factual

settings that are covered by statute, even when these personal

7

See Wahlstrom v. Kawasaki Heavy Indus., Ltd., 4 F.3d

1084, 1094 (2d Cir. 1993) ("We are in general agreement with the

view that plaintiffs who are not allowed by general maritime law

to seek nonpecuniary damages for loss of society should also be

barred from seeking nonpecuniary punitive damages."), cert.

denied, 114 S. Ct. 1060 (1994); Bergen v. F/V St. Patrick, 816

F.2d 1345, 1347 (9th Cir. 1987) ("Punitive damages are non-

pecuniary damages unavailable under the Jones Act."); Kopczynski

v. The Jacqueline, 742 F.2d 555, 561 (9th Cir. 1984) ("Punitive

damages are nonpecuniary."), cert. denied, 471 U.S. 1136 (1985);

Merry Shipping, 650 F.2d at 626 (noting that its previous holding

that only pecuniary damages are recoverable under the Jones Act

casts doubt upon the availability of punitive damages under the

Act); Kozar v. Chesapeake and Ohio Ry. Co., 449 F.2d 1238, 1240-

43 (6th Cir. 1971); Anderson, 797 F. Supp. at 534 ("[T]he post-

Miles district court cases, in this district and in others, speak

with one voice in concluding that punitive damages are

nonpecuniary and, therefore, are not recoverable under Miles's

interpretation of the Jones Act.") (collecting cases); Penrod

Drilling Corp. v. Williams, 868 S.W.2d 294, 296-97 (Tex. 1993).

8

The Jones Act provides in the following relevant part:

Any seaman who shall suffer personal injury in the

course of his employment may, at his election, maintain

an action for damages at law . . . and in case of death

of any seaman as a result of any such personal injury

the personal representative of such seaman may maintain

an action for damages at law . . . .

46 U.S.C. § 688(a).

21

injury claims are brought under the general maritime law.9 See,

9

Although the Miles Court discussed Vreeland's pecuniary

limitation on FELA and Congress's incorporation of FELA into the

Jones Act, it is important to remember that Vreeland was

discussing the FELA wrongful death provision. See Miles, 498

U.S. at 32; Vreeland, 227 U.S. at 69-71; supra note 7. Thus, the

Jones Act pecuniary limitation discussed in Miles -- a limitation

stemming from a FELA limitation on wrongful death claims -- is

arguably not applicable to non-fatal personal injury claims under

the Jones Act. See Horsley, 15 F.3d at 202 & n.2 ("[A]s concerns

the Jones Act, Vreeland is inapposite to the availability of

damages for nonpecuniary loss in cases involving nonfatal

injuries. . . . [T]he evidence directly adduced by the Miles

Court is not directly probative beyond the discrete confines of

wrongful death actions.").

This distinction will not affect a claim for punitive

damages, however, because "[i]t has been the unanimous judgment

of the courts since before the enactment of the Jones Act that

punitive damages are not recoverable under the Federal Employers'

Liability Act." Miller v. American President Lines, Ltd., 989

F.2d 1450, 1457 (6th Cir.) (citing Kozar, 449 F.2d at 1240-43)

(emphasis added), cert. denied, 114 S. Ct. 304 (1993); see also

Horsley, 15 F.3d at 203 (quoting Miller in a personal injury case

and denying recovery for punitive damages in unseaworthiness

actions); Kopczynski, 742 F.2d at 560 ("Prior to enactment of the

Jones Act in 1920, it had been established that only compensatory

damages were available in FELA actions.").

The Sixth Circuit's Kozar opinion quoted from a number of

Supreme Court cases, including St. Louis, Iron Mountain &

Southern Railway Co. v. Craft, 237 U.S. 648 (1915). In Craft,

the Court indicated that an injured employee's right under the

FELA was to recover compensatory damages. See Craft, 237 U.S. at

656 (noting that the FELA "invests the injured employe[e] with a

right to such damages as will compensate him for his personal

loss and suffering" (emphasis added)); id. at 658 (observing that

the FELA allowed "the right existing in the injured person at his

death" to survive to the injured's personal representative, and

then stating that the personal representative could therefore

recover "such damages as will be reasonably compensatory for the

loss and suffering of the injured person while he lived"

(emphasis added)); see also Vreeland, 227 U.S. at 65 ("If he [the

injured employee] had survived he might have recovered such

damages as would have compensated him for his expense, loss of

time, suffering and diminished earning power." (emphasis added)).

Thus, when the Jones Act, incorporating FELA, was enacted in

1920, see Miles, 498 U.S. at 32, injured employees did not have a

right to recover punitive damages under the FELA. As a

consequence, the same punitive damages bar was incorporated into

22

e.g., Murray v. Anthony J. Bertucci Constr. Co., 958 F.2d 127, 131-

32 (5th Cir.) (applying the principles of Miles to preclude an

injured seaman's spouse from recovering loss of society damages

under the general maritime law), cert. denied, 113 S. Ct. 190

(1992); Michel v. Total Transp., Inc., 957 F.2d 186, 191 (5th Cir.

1992) (applying Miles to a personal injury claim by a seaman and

holding that "damages recoverable in general maritime causes of

action for personal injury of a Jones Act seaman do not include

loss of consortium"); Anderson, 797 F. Supp. at 534, 536 (noting in

a personal injury action of seamen that their general maritime

claims "encompass[ed] the same factual events and the same injuries

as their Jones Act claims," and concluding that "[t]he application

of Miles here compels the dismissal of the plaintiffs'

unseaworthiness and general maritime negligence punitive damages

claims").

After Miles, it is clear that Merry Shipping has been

effectively overruled. Its holding -- that punitive damages are

available in a wrongful death action brought by the representative

of a seaman under the unseaworthiness doctrine of the general

maritime law -- is no longer good law in light of the Miles

uniformity principle because, in the factual scenario of Merry

Shipping, the Jones Act damages limitations control.10

the Jones Act. See Pacific S.S. Co. v. Peterson, 278 U.S. 130,

136-39 (1928) ("[T]he right under the new [Jones Act] rule

[allows a seaman] to recover compensatory damages for injuries

caused by negligence" (emphasis added)).

10

It is interesting to note that in Merry Shipping, an

unseaworthiness case, we looked to the availability of punitive

23

3. Robinson v. Pocahontas, Inc.

We turn to the last of our precedents that formed the

foundation of our Holmes decision -- Robinson v. Pocahontas, Inc.,

477 F.2d 1048 (1st Cir. 1973). In Robinson, the court upheld an

award of punitive damages on a seaman's claim for maintenance and

cure. See 477 F.2d at 1051-52. The court cited Vaughan for the

proposition that the "Supreme Court held that a seaman could

recover attorneys' fees as damages where a shipowner was callous,

willful, or recalcitrant in withholding these [maintenance and

cure] payments." Id. at 1051. Significantly, however, the court

emphasized the language in the Vaughan dissent: "`[I]f the

shipowner's refusal to pay maintenance stemmed from a wanton and

intentional disregard of the legal rights of the seaman, the latter

would be entitled to exemplary damages in accord with traditional

concepts of the law of damages.'" Id. (quoting Vaughan, 369 U.S.

at 540 (Stewart, J., dissenting)).

damages in maintenance and cure cases for guidance in determining

whether punitive damages were available in the unseaworthiness

context before us. See Merry Shipping, 650 F.2d at 625 (citing

and discussing Robinson v. Pocahontas, Inc., 477 F.2d 1048 (1st

Cir. 1973), which allowed punitive damages in a maintenance and

cure action). Thus, if we similarly look to more recent

unseaworthiness cases for guidance in determining whether

punitive damages are still available in the maintenance and cure

context now before us, we find it relevant, though not

controlling, to observe that in the wake of Miles, appellate

courts have held that punitive damages are now unavailable in

unseaworthiness actions under the general maritime law. See

Horsley v. Mobil Oil Corp., 15 F.3d 200, 203 (1st Cir. 1994);

Miller, 989 F.2d at 1454-59; Penrod Drilling Corp. v. Williams,

868 S.W.2d 294, 296-97 (Tex. 1993); Sky Cruises, Ltd. v.

Andersen, 592 So.2d 756, 756 (Fla. Dist. Ct. App. 1992).

24

To be sure, Pocahontas did uphold an award of punitive damages

in a maintenance and cure context, but for at least two reasons, we

believe that it is not a particularly strong precedent. First, the

Pocahontas court's emphasis on the Vaughan dissent is troubling,

especially because it seems that the court relied on the dissent to

reach its conclusion that punitive damages -- in excess of

attorney's fees -- may be awarded in maintenance and cure cases.

As the Second Circuit noted in Kraljic v. Berman Enterprises, Inc.:

The [Pocahontas] court justified the punitive damage

award primarily by relying on Mr. Justice Stewart's

dissenting opinion in [Vaughan v.] Atkinson which, as we

have indicated, would have awarded exemplary damages

under traditional concepts not necessarily limited to the

amount of counsel fees. The obvious difficulty with this

approach is that the court followed the views of the

dissenters in Atkinson and not the majority. The court,

we believe, correctly perceived that both majority and

minority opinions in Atkinson in essence found that

punitive damages were awardable in maintenance and cure

cases. The inescapable fact is, however, that the

majority opinion in Atkinson limited that recovery to

counsel fees despite the explicit view of the dissenters

that no such curb be imposed.

575 F.2d 412, 415-16 (2d Cir. 1978) (emphasis added) (citation

omitted).

Second, even if we overlook the Pocahontas court's apparent

reliance on the Vaughan dissent, the decision was rendered

seventeen years before Miles. In light of Miles, we cannot be sure

that the First Circuit would reach the same result today as it did

in Pocahontas. Cf. Horsley v. Mobil Oil Corp., 15 F.3d 200, 203

(1st Cir. 1994) ("Miles mandates the conclusion that punitive

damages are not available in an unseaworthiness action under

general maritime law."). In short, Pocahontas was not rock-solid

25

support to begin with, and because of Miles, we believe that its

precedential weight has been further eroded.11

4. The law of other circuits

As mentioned, our court and the First Circuit have upheld

punitive damage awards in cases of willful nonpayment of

maintenance and cure. In the Second Circuit's Kraljic opinion, the

court also found that punitive damages were available in

maintenance and cure cases, but the court relied on Vaughan to

conclude that any "punitive" recovery is explicitly limited to

attorney's fees. See Kraljic, 575 F.2d at 415-16.

11

Guevara contends that the Pocahontas court did not rely

on the Vaughan dissent. According to Guevara, the Pocahontas

court was "mindful that the Supreme Court had not been asked to

award punitive damages in Vaughan," and as a consequence, it

awarded punitive damages "in accord with traditional concepts of

the law of damages." The language of the Vaughan dissent was

cited merely as an example of this "traditional concept."

We note, however, that even though admiralty cases have long

suggested that punitive damages might be available, see, e.g.,

The Amiable Nancy, 16 U.S. (3 Wheat.) 546, 558 (1818) ("[I]f this

were a suit against the original wrong-doers, it might be proper

to go yet farther, and visit [punishment] upon them in the shape

of exemplary damages . . . ." (emphasis added)), the Supreme

Court has never affirmed an award of punitive damages in an

admiralty case. Similarly, before Vaughan, there are very few

lower court cases that actually awarded or affirmed an award of

punitive damages in a general maritime law context. See

Gallagher v. The Yankee, 9 F. Cas. 1091, 1093 (C.C.N.D. Cal.

1859) (No. 5,196) (assessing punitive damages), aff'd, 30 F. Cas.

781 (C.C.N.D. Cal. 1859) (No. 18,124); cf. Petition of Den Norske

Amerikalinje A/S, 276 F. Supp. 163, 174, 196-99 (N.D. Ohio 1967)

(awarding punitive damages but noting that "punitive damages have

never been visited upon a tortfeasor in an admiralty

proceeding"), rev'd sub nom. United States Steel Corp. v.

Fuhrman, 407 F.2d 1143, 1146-48 (6th Cir. 1969), cert. denied,

398 U.S. 958 (1970).

Moreover, even if we were to accept Guevara's construction

of the Pocahontas rationale, we would still be influenced by the

maritime developments brought on by Miles.

26

In Hines v. J.A. LaPorte, Inc., 820 F.2d 1187 (11th Cir.

1987), the Eleventh Circuit squarely confronted the issue of

"whether a seaman may be awarded punitive damages in addition to

reasonable attorney's fees for the arbitrary and willful

withholding of maintenance and cure benefits." Id. at 1188. The

court recognized that punitive damages in excess of attorney's fees

were available in the First Circuit and in the Fifth Circuit, while

the Second Circuit limited the award to attorney's fees. The court

chose to rely on our Merry Shipping opinion, noting that

"[f]ollowing the guidance of Merry Shipping . . . it seems clear

that even if exemplary in nature, attorney's fees, if fixed

reasonably to cover only a proper fee award, would not foreclose

the punitive purpose of a punitive damage award." Id. at 1189.

Thus, the Hines court held that "both reasonable attorney's fees

and punitive damages may be legally awarded in a proper case." Id.

Of course, Hines's reliance on Merry Shipping is now analytically

problematic because, as explained, Merry Shipping was effectively

overruled by the later decision in Miles. Similarly, in Manuel v.

United States, 50 F.3d 1253 (4th Cir. 1995), the Fourth Circuit in

dicta noted that "[c]ourts have long awarded punitive damages to

seamen where maintenance and cure benefits have been arbitrarily

and willfully denied." Id. at 1260. The court cited Holmes and

Pocahontas for this proposition, however, and there was no mention

of Miles.

The law in the Sixth Circuit is unclear. Dicta in Al-Zawkari

v. American Steamship Co., 871 F.2d 585, 590 n.8 (6th Cir. 1989),

27

implies that punitive damages could be available, but the decision

was pre-Miles and it cited Holmes as support. The district courts

in the Sixth Circuit have also come to different conclusions.

Compare Hoeffling v. United States Steel, 792 F. Supp. 1029, 1030

(E.D. Mich. 1991) ("[A] claim for punitive damages under the

doctrine of maintenance and cure is recognizable in this circuit.")

with Owens v. Conticarriers & Terminals, Inc., 591 F. Supp. 777,

792 (W.D. Tenn. 1984) (holding that "because defendant's refusal to

pay maintenance and cure was callous and willful, plaintiff is

entitled to an award of punitive damages limited to attorney's

fees") and In re Mardoc Asbestos Case Clusters, 768 F. Supp. 595,

599-600 & n.1 (E.D. Mich. 1991) (suggesting that punitive damages

are not recoverable at all in the general maritime law). As

mentioned, it is worth noting that the Sixth Circuit in Miller

concluded that Miles precluded the recovery of punitive damages in

general maritime unseaworthiness actions.

Finally, a recent Ninth Circuit opinion explicitly addressed

the post-Miles propriety of a punitive damages award for the

failure to pay maintenance and cure. In Glynn v. Roy Al Boat

Management Corp., Nos. 93-15546, 93-15681, 1995 WL 366967 (9th Cir.

June 21, 1995), the Ninth Circuit stated that "[b]ecause Miles did

not consider the availability of punitive damages, and was not

faced with a claim for maintenance and cure that has no statutory

analog, it does not directly control the question of whether

punitive damages are available for the willful failure to pay

maintenance." Id. at *7. Instead, the court looked to Vaughan for

28

guidance, and it determined that "we see no support for punitive

damages in addition to attorney's fees in Vaughan itself . . . .

We see no other reason why punitive damages, in addition to

attorney's fees, should be allowed." Id. at *8. As the court

concluded, "[w]e therefore hold that punitive damages are not

available, although attorney's fees are, where the shipowner has

been willful and persistent in its failure to investigate a

seaman's claim for maintenance and cure or to pay maintenance."

Id. at *9.

To sum up, the cases that Holmes relied upon cannot now

support the result in Holmes. Vaughan awarded attorney's fees, and

not punitive damages; Merry Shipping did not involve maintenance

and cure, and it has been overruled by Miles; and Pocahontas is

questionable in light of its pre-Miles analysis and its apparent

reliance upon the Vaughan dissent.12 We turn now to the independent

impact of the Miles decision on the availability of punitive

damages in cases of willful nonpayment of maintenance and cure.

C. The Effect of Miles on Maintenance and Cure Actions

Maritime argues that Guevara's recovery of punitive damages in

his maintenance and cure action is barred by the dictates of Miles.

Maritime's argument, of course, cannot rest on the specific

holdings of Miles, as Miles did not involve a maintenance and cure

12

Of the federal appellate cases that Holmes does not

cite, Glynn precluded the recovery of punitive damages, Kraljic

limited punitive damages to the amount of attorney's fees, and

Hines relied on the now-overruled Merry Shipping. The other

circuit law is dicta at best, and the cases relied upon our

Holmes decision.

29

claim. The logic and analytical framework of Miles, however, are

clearly relevant, and they do support Maritime's argument.

Based on our interpretation of Miles, it should be clear that

with maintenance and cure actions, we simply need to ask if "the

factual setting of the case" or the "situation" is one covered by

a statute like the Jones Act or DOHSA.13 Seizing on this framework,

some courts have already determined that a maintenance and cure

action is not covered by statute, and as such, this general

maritime action is not subject to the Miles uniformity principle.

See, e.g., Anderson, 797 F. Supp. at 536 ("[P]unitive damages for

willful failure to pay maintenance and cure, a firmly rooted

general maritime law claim, is unaffected by Miles because failure

to pay is a contractual claim not reached by any maritime statute.

Such claims do not implicate negligence or strict liability

values."); Breshears v. River Marine Contractors, Inc., Civ. A. No.

92-1850, 1992 WL 245656, at *2 (E.D. La. Sept. 10, 1992) ("Actions

for the failure to pay maintenance and [c]ure are grounded in the

13

It is for this reason that Guevara's appeal to the

double wage penalty provision of 46 U.S.C. § 10313 (formerly 46

U.S.C. § 596) is unavailing, as this statute does not cover

maintenance and cure actions. See Clinton v. Joshua Hendy Corp.,

277 F.2d 447, 447-48 (9th Cir. 1960) (per curiam) (holding that

maintenance payments are not "wages" and are therefore not

subject to the double penalty provision of § 596); Ladzinski v.

Sperling S.S. & Trading Corp., 300 F. Supp. 947, 958 (S.D.N.Y.

1969) ("It has been held that the shipowner's duty of prompt

payment of `wages' under [§] 596 does not apply to the unearned

wages due to the seaman injured in the service of the vessel . .

. or to the maintenance and cure benefits owed to the same

seaman.") (collecting cases). Similarly, analogies to the

Longshore and Harbor Workers' Compensation Act ("LHWCA") are not

particularly relevant, as the LHWCA does not cover plaintiff

seamen (like Guevara) or maintenance and cure actions.

30

general maritime law and have no counterpart in the tort provisions

of DOHSA and the Jones Act. . . . The principles of uniformity

found in Miles . . . are, therefore, inapposite to the

determination of whether punitive damages are available for a

failure to pay maintenance and cure."); Howard v. Atlantic Pacific

Marine Corp., Civ. A. No. 89-3073, 1992 WL 55487, at *2 (E.D. La.

Feb. 28, 1992) ("[U]nlike unseaworthiness and negligence claims,

maintenance and cure claims have no counterpart under the Jones Act

or the DOHSA."); Ridenour v. Holland America Line Westours, Inc.,

806 F. Supp. 910, 911 (W.D. Wash. 1992) ("The Miles Court, however,

did not address maintenance and cure, which is an area of law in

which Congress has not legislated against punitive damages. Thus

this Court concludes that Miles is not dispositive on this

point.").

The analysis, however, is somewhat more complicated. A

careful examination of the maintenance and cure action belies the

contention that it has no analog in the existing statutory schemes.

In Cortes, Justice Cardozo was faced with the question of "whether

death resulting from the negligent omission to furnish care or cure

is death from personal injury within the meaning of the [Jones Act]

statute." 287 U.S. at 372 (emphasis added). Initially, Justice

Cardozo recognized the peculiar nature of the shipowner's duty to

provide maintenance and cure:

The duty to make such [maintenance and cure] provision is

imposed by the law itself as one annexed to the

employment. 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.

31

. . .

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. For

breach of a duty thus imposed, the remedy upon the

contract does not exclude an alternative remedy built

upon the tort.

Id. at 371-72 (emphasis added) (citation omitted); see also id.

("If the wrong is of such a nature as to bring it by fair

intendment within the category of a `personal injury' that has been

caused by the `negligence' of the master, it is not put beyond the

[Jones Act] because it may appropriately be placed in another

category also."). Thus, as the Supreme Court explained by way of

example:

The failure to provide maintenance and cure may be a

personal injury or something else according to the

consequences. If the seaman has been able to procure his

maintenance and cure out of his own or his friends'

money, his remedy is for the outlay, but personal injury

there is none. If the default of the vessel and its

officers has impaired his bodily or mental health, the

damage to mind or body is none the less a personal injury

because he may be free at his election to plead it in a

different count.

Id. at 373-74 (emphasis added). The Court therefore concluded:

While the seaman was still alive, his cause of action for

personal injury created by the statute may have

overlapped his cause of action for breach of the maritime

duty of maintenance and cure, just as it may have

overlapped his cause of action for injury caused through

an unseaworthy ship. In such circumstances, it was his

privilege, in so far as the causes of action covered the

same ground, to sue indifferently on any one of them.

Id. at 374-75; see also Picou v. American Offshore Fleet, Inc., 576

F.2d 585, 587 (5th Cir. 1978) (citing and discussing Cortes after

noting that "[t]he defendant takes the position that since a

[personal injury] recovery could be available to [the plaintiff] in

32

a simple action for maintenance and cure, he could not allege a

tort claim comprehending the same elements of injury . . . . This

is simply not the law."); Gilmore & Black, supra, § 6-13, at 311

("Such [personal injury] damages may be recovered either in an

action for maintenance and cure or in an action for negligence

under the Jones Act.") (citing Cortes).

Thus, as the Supreme Court has indicated, there are really two

"types" of maintenance and cure actions. The tort-like type

involves a personal injury; i.e., typically a worsening of the

seaman's physical or mental health caused by the failure to provide

maintenance or, more likely, cure. The contract-like type need not

involve a personal injury (although it may); it need only involve

the loss of a monetary outlay. Because the tort-like maintenance

and cure action involves a personal injury, however, it overlaps

with the personal injury coverage of the Jones Act.14 Such an

action is frequently brought under the Jones Act. See, e.g.,

Picou, 576 F.2d at 586-87; Gaspard v. Taylor Diving & Salvage Co.,

14

Indeed, in 1982, Congress amended the Jones Act by

adding § 688(b):

No action may be maintained under subsection (a) of

this section [the original Jones Act] or under any

other maritime law of the United States for maintenance

and cure or for damages for the injury or death of a

person who was not a citizen or permanent resident

alien of the United States at the time of the incident

giving rise to the action . . . .

46 U.S.C. § 688(b) (emphasis added). It is noteworthy that this

denial of maintenance and cure to a class of seamen was added

under the Jones Act, as it indicates a congressional recognition

that maintenance and cure actions are related to the Jones Act

scheme.

33

649 F.2d 372, 376 (5th Cir. 1981), cert. denied, 455 U.S. 907

(1982). As mentioned, once there is a statutory/general maritime

law overlap in the factual circumstances that are covered, the

Miles damages uniformity principle is invoked, and punitive damages

would be precluded under the general maritime action for

maintenance and cure.15

Guevara seems to assert that our characterization of a Jones

Act "overlap" is not accurate for maintenance and cure actions that

give rise to punitive awards because "[i]t is the willful conduct

of the vessel owner not negligence of the Captain or crew which

gives rise to [an] award of punitive damages for failure to pay

maintenance and cure." This argument, however, is misconceived, as

the willful refusal to pay maintenance and cure is not a cause of

action separate from the negligent failure to pay maintenance and

cure. As the Fourth Circuit explained in Manuel:

[T]he . . . court went astray by treating the arbitrary

and willful refusal to pay maintenance and cure as a

cause of action separate from the simple failure to pay

maintenance and cure benefits when due. There is no

cause of action specifically for the arbitrary and

willful refusal to pay maintenance and cure. Under

general maritime law, a seaman injured while employed

aboard a ship is entitled to receive maintenance and

cure, and he can bring an admiralty suit to recover any

unpaid maintenance and cure benefits. Courts have long

15

Guevara tries to circumvent the Miles uniformity

principle by arguing that "Congress did not create the right to

maintenance and cure nor . . . did Congress create the right to

sue a vessel owner for failure to provide maintenance and cure to

its injured seaman." We note, however, that Congress neither

created the warranty of seaworthiness nor fashioned the general

maritime unseaworthiness action; nevertheless, this did not

prevent the Supreme Court from concluding that the

unseaworthiness action is subject to the Miles uniformity

principle.

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awarded punitive damages to seamen where maintenance and

cure benefits have been arbitrarily and willfully denied.

E.g., Holmes v. J. Ray McDermott & Co., 734 F.2d 1110,

1118 (5th Cir. 1984); Robinson v. Pocahontas, Inc., 477

F.2d 1048, 1051-52 (1st Cir. 1973). Punitive damages,

however, is merely an additional remedy in the seaman's

maintenance and cure action.

50 F.3d at 1259-60. Thus, the denial of maintenance and cure

benefits gives rise to only one cause of action -- failure to pay

maintenance and cure -- and this one action is cognizable under

both the Jones Act and the general maritime law, although the

action under the Jones Act for the failure to pay maintenance and

cure requires a personal injury as well. If willful conduct is

demonstrated, it raises the possibility of a punitive award, but

the cause of action for failure to pay maintenance and cure does

not require or depend upon proof of willfulness.

Based on this rationale, it should be clear that proving even

a willful denial of maintenance and cure cannot justify an award of

punitive damages after Miles. Under Cortes, a tort-like action for

the failure to pay maintenance and cure is cognizable under the

Jones Act, but even if willful behavior is established, the Jones

Act does not provide for punitive damages. Under the Miles

uniformity principle, therefore, the same cause of action under the

general maritime law for the failure to pay maintenance and cure

cannot provide a punitive recovery, even if willfulness is

demonstrated.

Of course, our analysis is not yet complete, because in the

instant case, Guevara brings a contract-like maintenance and cure

action. Guevara suffered no personal injury from the failure to

35

provide maintenance and cure, and therefore, there is no statutory

overlap to invoke the Miles uniformity principle. In such a case,

the general maritime law is not directly constrained by statute.

Nevertheless, for several reasons, we believe that punitive damages

should not be available in any action for maintenance and cure,

even in those contract-like actions that can only be brought under

the general maritime law.

First, even admitting that the primary reason for allowing

punitive damages is to deter wrongful conduct on the part of a

potential wrongdoer -- here, the shipowner -- it seems peculiar to

deny punitive damages to a seaman who suffers personal injury

because of a willful failure to pay maintenance and cure, but to

allow the possibility of a punitive recovery for a seaman who

suffers only a monetary loss.

Second, Guevara is asking us to affirm a punitive damages

award that is not available under related legislative schemes. As

the Supreme Court stated in American Dredging Co. v. Miller, 114 S.

Ct. 981, 989 (1994), "[w]hile there is an established and

continuing tradition of federal common lawmaking in admiralty, that

law is to be developed, insofar as possible, to harmonize with the

enactments of Congress in the field." In the context before us,

therefore, American Dredging counsels us to err on the side of

"harmonization" with the legislative schemes, and that nudge

towards harmony weighs in favor of prohibiting punitive damages in

maintenance and cure cases, at least where, as here, a clear legal

basis for the award of such damages is lacking.

36

Third, a concern for uniformity within federal admiralty law

affects our decision. It makes little sense to create a

fragmentation of admiralty law by allowing punitive damages in one

class of maintenance and cure cases (contract-like), yet

disallowing punitive damages in the other class of maintenance and

cure cases (tort-like).

Fourth, when no element of personal injury is involved, these

contract-like maintenance and cure actions are just that --

primarily contract-oriented claims. Punitive damages, however, are

generally unavailable for breach of contract, and to the limited

extent that the obligation to pay maintenance and cure is

contractual in nature, allowing punitive damages for a breach

thereof is anomalous. See, e.g., Restatement (Second) of Contracts

§ 355, at 154-56 (1979); 11 Samuel Williston, A Treatise on the Law

of Contracts § 1340, at 209-12 (3d ed. 1968); 5 Arthur Linton

Corbin, Corbin on Contracts § 1077, at 437-39 (1964).16

III. CONCLUSION

Our Holmes precedent for the availability of punitive damages

in maintenance and cure cases is no longer well-founded. In

particular, the advent of Miles brings about significant changes in

the admiralty that we cannot ignore. We conclude that Vaughan and

16

We do not address Maritime's procedural due process

concerns as they were not raised in the district court or in the

initial appeal. See Cinel v. Connick, 15 F.3d 1338, 1345 (5th

Cir.) ("An appellant abandons all issues not raised and argued in

its initial brief on appeal." (emphasis omitted)), cert. denied,

115 S. Ct. 189 (1994); Quenzer v. United States (In re Quenzer),

19 F.3d 163, 165 (5th Cir. 1993) ("Typically, we will not

consider on appeal matters not presented to the trial court.").

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Miles still permit the recovery of attorney's fees in maintenance

and cure cases as long as the proper showing of egregious fault is

made. See, e.g., Morales, 829 F.2d at 1358. However, when we

couple the weakened foundation of Holmes with our understanding of

the Miles uniformity principle, we are persuaded that punitive

damages should no longer be available in cases of willful

nonpayment of maintenance and cure under the general maritime law.

To this extent, therefore, Holmes is overruled. The district

court's judgment is REVERSED insofar as it awarded punitive damages

to Guevara for the willful failure to pay maintenance, but in all

other respects, the judgment of the district court is AFFIRMED.

Costs shall be borne by Maritime.

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