# Petition — Oldendorf v. Lopez > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385004_1512%3A1 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition - **Published:** January 1, 1977 - **Citation:** 431 U.S. 938 ## Text Supreme Court, U. & ‘me FILED A APR 8 977 MICHAEL RODAK, JR., CLERK IN THE Supreme Court of the United States OCTOBER TERM 1976 EGAN OLDENDORF, Petitioner, vs. BENITO LOPEZ, INTERNATIONAL TERMINAL OP- ERATING CO., INC., ann HOFFMAN RIGGING AND CRANE SERVICE, INC. Respondents. PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT Victor S. CIcRANOwICZ Counsel for Petitioner 80 Broad Street New York, New York 10004 TABLE OF CONTENTS PAGE Citations to Opinions Below ...................... 1 D ̃˙ *r. ˙¹Ü 0. 2 Z 2 D . A eee 2 Reasons for Granting the Writ 7 . ˙•7 5j rr i. 12 Appendix: Opinion of Court of Appeals Al Amended Judgment of Court of Appeals .......... A8 Order Denying Petition for Rehearing ............ 40 Excerpts From Transcript of Trial (Findings of ,, A A2 D, ̃ eG ae en nT Ea 421 ii TABLE OF AUTHORITIES ‘Cases: PAGE Atkinson v. United States, 297 U.S. 157 (1936) .... 7 Cooper Stevedoring Co., Inc. v. Kopke, 417 U.S. 106 E domain es ennadtinwencweestess 10, 12 De Gioia v. United States Lines Company, 304 F.2d / bieseca dudes tees 9 D/ Ove Skou v. Hebert, 365 F.2d 341 (5 Cir. 1966). . 9 Frieze v. West American Ins. Co., 190 F.2d 381 (8 Cir. b 11 Great Lakes Dredge d Dock Co. v. Huffman, 319 U.S. D d tens 10 Hartnett v. Reiss Steamship Company, 421 F. 2d 1011 (2 Cir. 1970), cert. den. 400 U.S. 852 (1970) 5, 8,9 Hill York Corp. v. American Franchises Inc., 448 e 8 Hormel v. Helvering, 312 U.S. 552 (19411) 9,11 International Terminal v. Nederl, 393 U.S. 74 (1968) 9 Italia Societa v. Oregon Stevedoring Co., 376 U.S. 315 r ˙ ‚öʒwadnd ser Vineeuess 9 Randall Foundation v. Riddell, 244 F.2d 803 (9 Cir. . 8 Ryan Stevedoring Co. v. Pan-Atlantic Steamship e Scccceadcccccuctedeus 8,9 Singleton v. Wulff, 428 U.S. 106 (1976) ............ 12 Smith v. American Guild of Variety Artists, 368 F.2d , „TTT oes uneneee baeensuss 7 Turner v. City of Memphis, 369 U.S. 350 (1962) ..... 12 United States v. Tyrrell, 329 F. 2d 341 (7 Cir. 1964) 7 United States v. United States Gypsum Co., 33 U.S. D eee 11 TABLE OF AUTHORITIES ili PAGE Usner v. Luckenbach Overseas Corp., 400 U.S. 494 — ei tid hone —·ðmW 55 6 Zenith Radio Corp. v. Hazeltine Research, Inc., 395 , ... 11 Statutes and Rules: Federal Rules of Civil Procedure (28 U.S. C. A.): D ̃ ͤ»A eh bcune bess 11 r ²˙ A » nnn. 2 Federal Rules of Appellate Procedure (28 U.S. C. A.): btb 12 Z cd ob eed eede 66s6 deus cu un 6oneeer 11 r bree „ 11 Iw THE Supreme Court of the United States OCTOBER TERM 1976 > Eoan OLDENDORF, Petitioner, vs. Bxxrro Lopez, IxTERNATTON AL. TERMINAL Orperatine Co., Ixc., and Horrman Rieornc anp Crane Service, Inc., Respondents. sé. . 4 PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT Petitioner, Egon Oldendorf, respectfully prays that a writ of certiorari issue to review the judgment of the United States Court of Appeals, entered in the above entitled case on the 9th day of December, 1976, and the order of said Court denying rehearing entered on the 10th day of January, 1977. Citations to Opinions Below The opinion of the Court of Appeals, printed in the Appendix hereto, infra Al-A7, is not as yet officially re- ported. The District Court rendered no written opinion or decision. Its decision and findings are contained in the portions of the record which are printed in the Appendix hereto, infra A12-A20. 2 Jurisdiction The judgment of the Court of Appeals was entered on the 9th day of December, 1976. Rehearing was denied on the 10th day of January, 1977. The jurisdiction of this Court is invoked under 28 U.S. C., Section 1254(1). Questions Presented 1. Where a judgment is entered in a District Court in accordance with the clear and explicit findings of the trial judge and after a hearing at which all parties were invited to assist the Court in formulating the judgment and were afforded an opportunity to interpose their objections, may a Court of Appeals, under the guise of the power to raise and decide issues sua sponte, disregard the record and the law on which the Court and parties relied, make its own findings and reverse the judgment on issues which were not raised, briefed or argued in the Court of Appeals or in the trial court? 2. Whether the right to claim error on appeal is waived when a party does not except to a jury instruction on a theory of liability, after said party has made its position known to the Court by moving to dismiss the cause of action under that theory in accordance with Rule 50, F.R.C.P., 28 U.S. C. A., infra A21, and the Court has denied said motion? Statement This case arises out of an accident which was sustained by a longshoreman on board petitioner’s vessel at the com- mencement of the discharge of a cargo of steel I beams from the #1 hatch of said vessel. No ship’s personnel or equipment was in any way involved in the discharging operation. It was conducted by and under the direct su- pervision of longshoremen in the employ of International 3 Terminal Operating Co., Inc., (ITO), with the assistance of a shoreside mobile crane which ITO had hired together with an operator from Hoffman Rigging & Crane Service, Ine. (Hoffman). The accident occurred shortly after the longshoremen had mad up and hooked a draft of steel I beams to the cargo hook of the crane. A signalman, employed by ITO whose function was to act as the “eyes and ears” of the crane operator, then instructed the crane operator to raise the draft of I beams. Instead of raising the draft, the crane operator dragged the draft from one side of the hatch to the other over and across the cargo of steel I beams which were stowed in the hatch. As a result, one of the I beams which was stowed in the hatch became dis- lodged and fell over on the injured longshoreman’s leg. While the draft was being dragged across the cargo in the hatch, the signalman stood by and did nothing. After the accident occurred, the signalman instructed the crane op- erator to stop and the crane operator stopped the operation. The only issues on which the case was tried against peti- tioner was whether the lashings and chocks by means of which the cargo of steel I beams had been secured from shifting during the ocean voyage had been removed by ship’s personnel prior to the commencement of the dis- charging operation, and if so, whether this rendered the vessel unseaworthy and the shipowner negligent. These issues were tried to a jury with counsel for all parties participating. Petitioner’s third party actions for indemnity against ITO and Hoffman, as well as ITO’s and Hoffman’s cross- claims for indemnity or contribution against each other were tried to the court. The jury, on a special verdict, found that the removal of the lashings and chocks by means of which the cargo of steel beams was secured for the ocean voyage did not 4 render the vessel unseaworthy, but that shipowner, never- theless, was negligent. It assessed damages at $365,000.00 and found that the injured longshoreman was contribu- torily negligent to the extent of 15%. Because of this, the recovery was reduced to $310,250.00. Following the return of the jury verdict, the court granted the injured longshoreman’s motion to amend his complaint and assert a direct negligence action against Hoffman. This action, together with the shipowner’s ac- tions for indemnity and the cross-claims of ITO and Hoff- man, was then set for further trial. After petitioner rested on the third party claims, the trial court granted recovery to petitioner against ITO “for the amount of the judgment against you plus counsel fees”, infra A12. On the completion of the testimony in the injured long- shoreman’s direct action against Hoffman, the trial court found the crane operator was negligent and that Hoffman was liable to plaintiff and awarded recovery against Hoff- man for the damages as assessed by the jury, infra Al13-Al4. In the course of extensive colloquy between court and counsel, the court emphasized that ITO’s liability by way of indemnity was for the full amount of the damages which had been assessed against petitioner, infra A1l2, Al6. It stated, however, that in “fairness and equity and justice, half of the damages ought to be borne by the steve- dore and half of the damages ought to be borne by Hoff- man, the crane operator”, but indicated uncertainty as to how to formulate a judgment to accomplish this result, infra Al4. All counsel were in complete agreement that the indemnity awarded petitioner could be apportioned between ITO and Hoffman, infra A14-A18. The only dilemma which arose was in the context of apportioning the damages between ITO and Hoffman in the injured longshoreman’s direct action against Hoffman, infra A18. Counsel for ITO suggested that since the court, as an ad- 5 miralty court had equity powers, it might dispense equity so that Hoffman would not be obligated for the judgment in full infra A17. After reading the decision in Hartnett v. Reiss S. S. Co., 421 F.2d 1011 (2 Cir. 1970), cert. den. 400 U.S. 852 (1970), the trial court indicated satisfaction that the indemnity award to petitioner could be apportioned be- tween ITO and Hoffman by stating: “In a situation very similar to our own, the Court of Appeals approved an equal decision of liability as between parties who correspond to ITO and Hoffman here.” Infra A18. Final judgment was then entered against petitioner which provided, that if petitioner paid the judgment, it was to recover 50% each from both ITO and Hoffman. If Hoffman paid the judgment, it was awarded 50% contribu- tion from ITO. The provision awarding counsel fees was stricken from the judgment and all other cross-claims were dismissed. All parties filed notices of appeal from the judgment. The injured longshoreman’s appeal was subsequently with- drawn. ITO appealed from the indemnity award to petitioner solely on the basis of the long rejected tort concept that a negligent shipowner is not entitled to an implied war- ranty of workmanlike service. It appealed from the award granting 50% of the damages which the judgment assessed against Hoffman on the grounds that this apportionment constituted contribution as between ITO and Hoffman. ITO further urged that it should be awarded full indemnity against Hoffman or, in the alternative, that its damages be in proportion to its fault, i.e., 15% of the total award. Petitioner appealed from the judgment on the ground that as a matter of law, it was error to submit the case to the jury because neither under the warranty of seaworthi- ness nor the theory of negligence, was a shipowner ob- ligated to furnish an accident free ship, and because under this court’s decision in Usner v. Luckenbach Overseas Corp., 400 U.S. 494 (1971), a shipowner is not lable for a wholly unforeseeable single act of negligence of a third party. It also urged that the jury’s findings of negligence and no unseaworthiness was inconsistent because there could be no negligent breach of a duty in the absence of the very underlying condition from which that duty arose. Petitioner also appealed from the denial of defense costs, including reasonable counsel fees. Not withstanding the fact that ITO did not raise, brief or argue either in the trial court or on appeal, that by ap- portioning the indemnity award equally between ITO and Hoffman, the trial court was in effect awarding contribu- tion. The Court of Appeals sua sponte construed the apportionment as in the nature of contribution and held that the apportionment constituted a constructive denial of indemnity. Not content to rest its reversal on that ground, the court went further and stated, “We agree that Oxpen- poRFF is precluded from obtaining indemnity from ITO * * * since between them OLpENporFF was the party best situated to adopt preventative measures and thereby to reduce the likelihood of injury.“ It is not clear with whom the court was agreeing as that issue was not pleaded or raised in the court below and had not been raised, briefed or argued in the Court of Appeals. Petitioner filed a petition for rehearing on December 23, 1976. In said petition, petitioner directed the court’s attention to the portion of the record in which the trial court held specifically that it was awarding petitioner full indemnity against ITO and reiterated that the award against ITO was by way of indemnity and not contribution. Petitioner also directed the court’s attention to the fact that conduct precluding indemnity was never raised in the court below or in the appeal. The Court of Appeals denied the petition for a rehear- ing on January 10, 1977 without comment. 7 Reasons for Granting the Writ 1. The action of the Court of Appeals in this case undermines the fairness and integrity which our judicial proceedings are designed to assure and preserve. If a Court of Appeals, under the guise of judicial discretion, is permitted to arrive at a bizarre result by distorting the clearly expressed resolution of a litigated controversy by misinterpreting the law and disregarding the record then the very foundation of our system of administering justice would be eroded and the safeguards which were designed to promote the ends of justice would be rendered mean- ingless. The reversal by the Court of Appeals of the portion of the judgment awarding indemnity to petitioner against ITO on the basis of a sua sponte determination of issues not presented to the District Court and not raised on the appeal was clearly in violation of the basic principles on which the proper and orderly administration of justice is predicated and constituted an unwarranted and unauthor- ized exercise of judicial power. The generally accepted rule in all jurisdictions is that questions, except when they involve jurisdiction, which have not been passed on in the trial Court and not raised, briefed or argued on appeal, will not ordinarily be given consideration by an Appellate Court. United States v. Tyrrell, 329 F. 2d 341, 345 (7 Cir. 1964) ; Smith v. American Guild of Variety Artists, 368 F.2d 511, 514 (8 Cir. 1966). As this Court said in Atkinson v. United States, 297 U.S. 157, 159 (1936): “This practice is founded upon considerations of fair- ness to the Court and to the parties and of the public interest in bringing litigation to an end after fair opportunity has been afforded to present all issues of law and fact.” In this case, even though the record clearly showed that the trial Court awarded petitioner full recovery against ITO and was explicit that it was by way of indemnity and not contribution, infra Al2, A16, A19, the Court of Appeals disagreed with the trial Court and sua sponte concluded that, even though the trial Court had styled it as indemnity, it was more in the nature of contribution, infra A6. Furthermore, even though the trial Court was clear and explicit that it was limiting ITO’s liability for indemnity in the judgment to 50% because “fairness and equity and justice” would be served if half of the damages were borne by ITO and half by Hoffman and such an equal decision of liability as between parties who correspond to ITO and Hoffman had been approved in Hartnett v. Reiss Steam- ship Company, 421 F.2d 1011, 1019 (2 Cir. 1970) cert. den. 400 U.S. 852 (1970), infra Al4, A18 the Court of Appeals construed apportionment as a constructive denial of in- demnity pursuant to Ryan Stevedoring Co. v. Pan-Atlantic Steamship Corp., 350 U.S. 124 (1956), infra A6. Although the issue of conduct precluding indemnity had not been pleaded as a defense and had not been raised either in the trial Court or on appeal, the Court of Appeals nonetheless again sua sponte found as a fact that peti- tioner “was the party best situated to adopt preventive measures and thereby reduce the likelihood of injury”. It then concluded “We agree that Oldendorf is precluded from obtaining indemnity from ITO.” even though no one had neither raised such an issue, nor even intimated that there was any such issue in this case, infra A6. While Federal Appellate Courts have power to raise and decide issues sua sponte, they have no original jurisdiction and lack power to make findings of fact. Randall Founda- tion v. Riddell, 244 F. 2d 803, 805 (9 Cir. 1957); Hill York Corp. v. American Franchises Inc., 448 F.2d 680, 691 (5 Cir. 1971). Since the issue of conduct precluding indem- nity is a question of fact and not of law, International 9 Terminal v. Nederil, 393 U.S. 74 (1968), the Court of Ap- peals clearly exceeded its jurisdiction in finding that peti- tioner was the party best situated to adopt preventive measures and thereby reduce the likelihood of injury. In Italia Societa v. Oregon Stevedoring Co., 376 U.S. 315 (1964) on which the Court of Appeals purportedly relied, this Court reiterated that shipowner negligence was not fatal to recovery against a stevedore, (376 U.S. at page 320), and held that as between the shipowner and the steve- dore who has supervision and control over the injury pro- ducing and defective ecuipment, is in a far better position than the shipowner to minimize the risk and avoid the ac- dent, (376 U.S. at nages 323 and 324). At least a trier of the fact could so find. Nor does the power to raise and decide issues sua sponte authorize an Appellate Court to distort the result reached in a litigated controversy, where considerations underlying the issues were exposed and distilled by the trial Court, and substitute its own resolution in disregard of the record and the decisional law. As this Court held in Hormel v. Helvering, 312 U.S. 552, 558 (1941) this power may be ex- ercised only in exceptional cases when it is obvious from the record that to do otherwise would result in a plain miscarriage of justice. It is obvious from the record in this case that the result of the apportionment of the ul- timate liability by way of indemnity between ITO and Hoffman was not a plain miscarriage of justice. Not only did Hartnett v. Reiss Steamship Company, 421 F.2d 1011, 1019 hold that apportionment was proper between parties who corresponded to ITO and Hoffman in this case, but such an apportionment was also allowed in De Gioia v. United States Lines Company, 304 F.2d 421 (2 Cir. 1962) and D/S Ove Skou v. Hebert, 365 F.2d 341, 351-352 (5 Cir. 1966). Ryan Stevedoring Co. v. Pan-Atlantic Steamship Corp., 350 U.S. 124 (1956) which the Court of Appeals cited in support of its finding that apportionment of the indemnity awarded petitioner between ITO and Hoffman constituted a constructive denial of indemnity to petitioner 10 supports no such proposition. It held instead, that the Longshoremen’s and Harbor Worker’s Compensation Act, 33 U.S.C. 905, did not shield the stevedore employer from liability for indemnity to a shipowner. Cooper Stevedor- ing Co., Inc. v. Kopke, 417 U.S. 106 (1974) held that con- tribution between mutual wrongdoers was not prohibited when it involved a liability which was not shielded by statute. The Court of Appeals obviously confused the in- dependent contractual obligation which ITO owed the ship- owner and the obligation ITO owed its employees. In any event, the trial Court had apportioned the ulti- mate liability between ITO and Hoffman and not between ITO and petitioner. If the apportionment was invalid, it was invalid only as between ITO and Hoffman and the Court of Appeals should have awarded petitioner full in- demnity against ITO in accordance with the findings and conclusions of the trial Court as judgments are required to be interpreted in the light of the trial Court’s findings and onclusions, Great Lakes Dredge d Dock Co. v. Huff- man, 319 U.S. 294, 295 (1943). The decision of the Court of Appeals has resulted not only in a gross miscarriage of justice, but represents a clear abuse of the powers of Appellate Review and a total disregard of the basic principles of due process. 2. Clearly the questions are of importance and merit the exercise of this Court’s supervisory powers to prevent the further erosion of the rules and legal principles which have been promulgated and defined in order to preserve the fairness, integrity and public reputation of judicial proceedings. When this Court on December 4, 1967 adopted the Federal Rules of Appellate Procedure its order of adoption provided that these rules are to govern the practice in appeals to the United States Courts of Appeals from the United States District Court. These rules are clear and obviously were intended to serve as guidelines so that the litigants would have a fair oppor- 11 tunity to be heard and the Courts would not be charged with errors which they did not commit or with failure to adjudicate an issue which they were not required to deter- mine. These rules recognized that as much as uniformity of practice and procedure was desired, the inflexible applica- tion of the rules would lead to injustice or conflict with the power given under Section 2106 of 28 U.S.C.A. which allows Federal Appellate Courts to modify, reverse or remand decisions “as may be just under the circum- stances”. (Hormel v. Helvering, 312 U.S. 552, 557 (1941). This appears to have been the intent of F.R.A.P. Rule 1(b), 28 U.S.C.A., which states: “These rules shall not be construed to extend or limit the jurisdiction of the Courts of Appeals as estab- lished by law.” It is well established law that Federal Appellate Courts do not have the power to decide factual issues de novo, Zenith Radio Corp. v. Hazeltine Research, Inc., 395 U.S. 100, 123 (1969) nor to reverse judgments and substitute their own judgment unless it is clear from the entire rec- ord that the judgment is, in fact, clearly erroneous and that an injustice has been done. United States v. United States Gypsum Co., 33 U.S. 364 (1948) rehearing denied 33 U.S. 869 (1948). Nor, as the Court said in Frieze v. West American Ins. Co., 190 F.2d 381, 382 (8 Cir. 1951) was it intended that under the rules new issues could be considered on appeal “if the purpose and result would be reversal of the case unless public policy or the plain mis- carriage of justice requires.” Needless to say, Rule 40 of the Federal Rules of Appel- late Procedure, 28 U.S. C. A., is not without purpose. It au- thorizes a petition for rehearing to bring to the attention of the reviewing Court points of law or fact which the Court may have overlooked. It would seem that a more meaningful 12 compliance with this rule would not leave the writ of cer- tiorari as the last resort. 3. The decision below appears to be in conflict with ap- plicable decisions of this Court. In Cooper Stevedoring Co. v. Kopke, 417 U.S. 106, 109 [2]4 (1974), this Court refused to consider an issue on the grounds of lack of jurisdiction because it had not been raised in the petition for a writ of certiorari. In Singleton v. Wulff, 428 U.S. 106, 120 (1976), this Court reversed because, although the Court of Appeals had jurisdiction to proceed on the merits, injustice was more likely to be caused than avoided by deciding the issue without affording petitioner an opportunity to be heard, even if petitioner had no evidence but only legal argu- ments to offer. In Turner v. City of Memphis, 369 U.S. 350, 352 (1962), this Court vacated an order and directed entry of a decree granting relief only after assuring itself that, on the record, no issue remained because the facts were not in dispute. This Court's Rule 23(1)(c) is similar in scope and pur- pose, to Rule 28(a)(2) of the Federal Rules of Appellate Procedure. It does seem that public interest, if not con- sistency, requires that the Federal Appellate Court exer- eise at least the same scrupulous concern which this does so that litigation may be brought to an end after fair oppor- tunity has been afforded to present all issues of law and fact and a controversy is resolved on the record and in ac- cordance with the law. CONCLUSION For the foregoing reasons, this petition for a writ of certiorari should be granted. Respectfully submitted, Victor S. CicHaNnowicz Coumsel for Petitioner 80 Broad Street : New York, New York 10004 Al Opinion of Court of Appeals. UNITED STATES COURT OF APPEALS For THe Seconp Cmcurr Nos. 162, 163, 164—September Term, 1976. (Argued November 19,1976 Deeided December 9, 1976.) Docket Nos. 76-7208, 76-7211, 76-7212 * * Benito Lopez, Plaintiff-Appellee, —against— Edax OLDENDORF, Defendant and Third Party Plaintiff-Appellant and Appellee, INTERNATIONAL TERMINAL OPERATING Co., INc., and Horrman RIGG NG AND Crane Service, Inc., Third Party Defendants-Appellanits and Appellees. + bd Benito Lopez, Plaintiff-Appellee, —against— EAN Ol DEN DORT and Horrman Ricernc & Crane Service, Inc., Defendants-Appellants and Appellees. dy. * A2 Opimon of Court of Appeals. Before: Warknuax and Moutuiaan, Circuit Judges, and PolLAcxꝰ“, District Judge. , 9 Appeals from a judgment of the United States Distriet Court for the Southern District of New York, Hon. Inzer B. Wyatt, Judge, ewarding damages to plaintiff longshore- man, and awarding indemnity and contribution among the defendant and third-party defendants. Affirmed in part; reversed in part. * * Rosert KLoxskx, Brooklyn, New York (DiCos- tanzo, Klonsky & Cutrona, Brooklyn, New York), for Plaintiff- Appellee. Victor S. Cicnanowicz, New York, New York (Cichanowicz & Callan, New York, New York), for Defendant and Third Party Plaintiff-Appellant and Appelle. JosepH A. Conen, New York, New York (Alex- ander, Ash, Schwartz & Cohen, New York, New York, Sidney A. Schwartz, of Coun- sel), for Third Party Defendant-Appellant and Appellee. Rosert S. Bianc, New York, New York (Hill, Betts & Nash, New York, New York), for Third Party Defendant-Appellant and Ap- pellee. * 9 * Hon. Milton Pollack, United States District Court f the Southern District of New York, sitting by designation. ™ A3 Opinion of Court of Appeals. Mou.uican, Circuit Judge: On October 21, 1968, International Terminal piece Co., Inc. (ITO), a stevedoring company, and Hoffman Rigging & Crane Service, Inc. (Hoffman), the owner and operator of a shoreside crane hired by ITO, were engaged in unloading a cargo of steel beams from the M/V Jobst Oldendorf, a vessel owned by Egan Oldendorf. The vessel was tied up with her portside inshore and her starboard side offshore. Prior to the arrival of the longshoremen, the ship’s personnel removed the lashings and chocks which had secured the stow. The Hoffman crane, operated by Leo Hogan, was driven onto the pier alongside the hatch of the vessel and received instructions from an ITO sig- nalman. The accident which occasioned this litigation occurred with the removal of the first draft. The plaintiff Benito Lopez and three other longshoremen secured the first draft with chains and attached them to the cargo hook of the erane. The ITO signalman then instructed Hogan merely to hoist the hook with the cargo attached. Instead, Hogan raised the boom of the crane, causing the draft to drag from the offshore side over to the inshore side. The draft struck and dislodged a beam which fell over and onto Lopez’s leg. Lopez brought suit in the United States District Court for the Southern District of New York, Hon. Inzer B. Wyatt, District Judge, against Oldendorf, alleging both unseaworthiness of the vessel as well as negligence. Olden- dorf impleaded ITO, Lopez’s employer, and Hoffman, seek- ing indemnity from both. Hoffman and ITO cross-claimed against each other, seeking both indemnity and contribu- tion. During the trial, Lopez was permitted to amend his complaint to sue Hoffman directly for negligence. The action by Lopez against Oldendorf was tried to a jury. All claims among Oldendorf, ITO and Hoffman, as well as Al Opinion of Court of Appeals. Lopez’s action against Hoffman, were tried to the court. Counsel for all parties participated in the jury trial of the Lopez action against Oldendorf. In the jury trial, a special verdict was returned on Feb- ruary 10, 1976 which provided: a) Lopez failed to establish his claim of unseaworthiness against Oldendorf, b) Lopez did establish his claim of negligence against Oldendorf, c) Lopez’s total damages amounted to $365,000, and d) Lopez was 15% contributorily negligent. Because of the last finding, Lopez’s recovery was reduced to $310,250. The court then undertook the resolution of the remaining issues. Because of its employee’s 15% contributory negli- gence, ITO was held to have breached its warranty of workmanlike service and was obligated to indemnify Olden- dorf. Hoffman was held liable to Lopez for the negligence of Hogan in operating the crane. The final judgment made Oldendorf and Hoffman jointly and severally liable. If Oldendorf paid the judgment, it was to recover 50% from both ITO and Hoffman. If Hoffman paid, it was awarded 50% contribution from ITO. Oldendorf was denied coun- sel fees, and all other cross-claims were dismissed. The various arguments raised on appeal are considered seriatim. Oldendorf makes two arguments for reversal of the judgment against it. It first contends that there was in- sufficient evidence to submit the case to the jury, citing Mitchell v. Trawler Racer, Inc., 362 U.S. 539 (1960) for the proposition that a ship owner is not required to provide an accident-free vessel. This is a correct statement of the law, but the court’s charge to the jury included this quali- fication. The factual issue was whether the lashings and chocks had been removed prior to the accident, and if they were, whether this constituted unseaworthiness or negli- gence. The resolution of this question, upon which there was conflicting evidence, was well within the classic function of the jury. A5 Opinion of Court of Appeals. Oldendorf also contends that the verdict was fatally in- consistent in finding that this act, although not rendering the vessel unseaworthy, was nonetheless negligent. In this circuit we have held that every effort must be made to reconcile such apparently contradictory findings, Henry v. A/S Ocean, 512 F.2d 401, 405-06 (2d Cir. 1975). Moreover, although the issue here is close, Oldendorf waived any claim of error on this ground when it failed to challenge that portion of the charge which instructed the jury that “you must consider and make a separate determination as to this second or alternative theory no matter how you decide the unseaworthiness theory.” Hoffman argues that it is not liable because its crane operator, Hogan, was the borrowed servant of ITO. How- ever, in a comparable factual setting, the Supreme Court has held that the mere reception of signals by a winchman from a stevedore’s foreman did not operate to relieve the winchman’s employer of liability for the negligence of its employee. Standard Oil Co. v. Anderson, 212 U.S. 215 (1909). Hoffman also contends that the granting of plain- tiff’s informal motion to proceed directly against it in February 1976, without requiring compliance with Fed. R. Civ. P. 14(a), deprived it of the opportunity to demonstrate prejudice from the delay in the assertion of this claim. Aside from its failure to indicate the nature of such preju- dice, Hoffman was an active participant in the case from the time of its joinder as a third party defendant in 1969. The nature of its potential liability having been clear from the beginning and developed at trial, the motion to amend the complaint cannot have come as any surprise. Cf. Wastk v. Borg, 423 F.2d 44, 46 (2d Cir. 1970). Finally, Hoffman challenges the jurisdiction of the court below to have entertained the direct action in the face of an absence of diversity of citizenship between itself and Lopez. However, { 4 of the amended complaint clearly indicates that the basis = “a. a . oe A6 Opinion of Court of Appeals. of jurisdiction is the admiralty and maritime nature of the claim.” Fed. R. Civ. P. 9(h). ITO contends that it was error to award Oldendorf in- demnity against it, and to grant Hoffman a 50% contribu- tion from it. Although the award in favor of Oldendorf was styled an “indemnity,” it was more in the nature of contribution since ITO’s liability was limited to 50% of the damages rather than a full recovery over. In these circumstances, the court below constructively denied Olden- dorf indemnity pursuant to Ryan Stevedoring Co. v. Pan- Atlantic Steamship Corp., 350 U.S. 124 (1956). We agree that Oldendorf is precluded from obtaining indemnity from ITO, Hurdich v. Eastmount Shipping Corp., 503 F.2d 397, 401-02 (2d Cir. 1974), since between them Oldendorf was the party “best situated to adopt preventive measures and thereby to reduce the likelihood of injury.” Italia Societa per Azioni di Navigazione v. Oregon Stevedoring Co., 376 U.S. 315, 324 (1964). Since we conclude that Oldendorf is precluded from obtaining indemnity, the theory upon which ITO was found liable, we reverse that portion of the judg- ment granting Oldendorf a 50% recovery from ITO. This disposition defeats Oldendorf’s claim for attorney’s fees since while they are recoverable when the ship owner is entitled to indemnity, DeGioia v. United States Lines Co., 304 F.2d 421, 426 (2d Cir. 1962), such an award is inappro- priate where, as here, indemnity is precluded. Equally unsupportable is the 50% contribution awarded Hoffman against ITO. Inasmuch as ITO furnished its em- ployee Lopez with the benefits required by the Longshore- men’s and Harbor Workers’ Compensation Act, 33 U.S.C. § 901 et seq., it is not subject to a claim for contribution. Cooper Stevedoring Co. v. Frite Kopke, Inc., 417 U.S. 106 (1974); Hurdich v. Eastmount Shipping Corp., supra, 503 F.2d at 400; Williams v. Pennsylvania R.R., 313 F.2d 203, 210 (2d Cir. 1963). A Opinion of Court of Appeals. We therefore affirm that portion of the judgment holding Oldendorf and Hoffman jointly and severally liable. In view of the findings below that both were negligent, each is to bear ultimate responsibility for one-half of the plain- tiff's damages. We reverse the award of indemnity to Oldendorf against ITO, as well as the contribution granted Hoffman from ITO. In view of the eight-year period which has elapsed since the accident occurred, the mandate shall issue forthwith. A8 Amended Judgment of Court of Appeals. UNITED STATES COURT OF APPEALS FOR THE Seconp Cmcurr At a stated Term of the United States Court of Appeals for the Second Circuit, held at the United States Court- house in the City of New York, on the ninth day of De- cember one thousand nine hundred and seventy-six. Present: Hon. Strerry R. WaTerRMAnN, Hon. WAA H. Murundax, C.JJ., Hon. Murox Pollack, D.. Cireuit Judges. 76-7208 76-7211 76-7212 —8 Benito Lopez, Plaintiff-Appellee, v. Egan Oldendorf, Defendant & Third Party Plaintiff, v. International Terminal Operating Co., Inc., Hoffman Rig- ging and Crane Service, Inc., and Paul Wilson & Co., AS., Third Party Defendants, Hoffman Rigging and Crane Service, Inc. International Terminal Operating Co., Inc., Third Party Defendants-Appellants. +. * 49 Amended Judgment of Court of Appeals. 4 9 Benito Lopez, Plaintiff, v. Egan Oldendorf and Hoffman Rigging & Crane Service, Inc., Defendant. * 7 Appeal from the United States District Court for the Southern District of New York. This cause came to be heard on the transcript of record from the United States District Court for the Southern District of New York, and was argued by counsel. ON CONSIDERATION WHEREOF, it is now hereby ordered, adjudged, and decreed that the order and judgment of said District Court be and they hereby are affirmed in part and reversed in part in accordance with the opinion of this court, with costs to be taxed against defendants-ap- pellants-appellees, Egan Oldendorf and Hoffman Rigging and Crane Service. A. DANIEL Fvusaro, Clerk by: Vincent A. Carin Chief Deputy Clerk Tre Al Order Denying Petition for Rehearing. UNITED STATES COURT OF APPEALS Serono Cmcurr At a Stated Term of the United States Court of Appeals, in and for the Second Circuit, held at the United States Court House, in the City of New York, on the tenth day of January, one thousand nine hundred and seventy-seven. Present: Hon. Sterry R. WaTrRRMAN Hon. WILIA H. Murad Circuit Judges Hon. Muro Pouiack District Judge 76-7208 Benito Lopez, Plaintiff-Appellee, v. Egan Oldendorf, Defendant and Third-Party Plaintiff-Appellant-Appellee, V. International Terminal Operating Co., Inc., et al., Third-Party Defendants, Hoffman Rigging and Crane Service, Inc., International Terminal Operating Co. Inc., Third-Party Defendants-Appellants. +. _ All Order Denying Petition for Rehearing. — * Benito Lopez, Plaintiff-Appellee, v. Egan Oldendorf and Hoffman Rigging & Crane Service, Inc., Defendants-Appellants. . * A petition for a rehearing having been filed herein by counsel for the appellant-appellee Egan Oldendorf, Upon consideration thereof, it is Ordered that said petition be and hereby is denied. A. Dax m. Fusaro A. Daniel Fusaro Clerk Al2 Excerpts From Transcript of Trial (Findings of Wyatt, U.S.D.J.). (13) Mr. Cichanowiez: As far as the shipowner is con- cerned now on the third party claims, I rest. The Court: All right. You are entitled to a judgment for the amount of the judgment against you plus counsel fees, and we won’t enter the judgment offer until Mr. Cohen or Mr. Schwartz have had a chance to review the matter and discuss it. It would be better if you could agree on the matter of counsel fees, but if you can’t I will have to fix it. All right. * a „ e * 0 (111) The Court: All right. What is next? Mr. Blanc: Hoffman rests, your Honor. The Court: All right. Anything else? Mr. Schwartz: May I have a moment to see whether I have any rebuttal? I don’t know about Mr. Klonsky. Mr. Klonsky: I have no rebuttal. The Court: Ali right, Mr. Schwartz. (Pause.) Mr. Schwartz: I don't know the sequence of things, but since I spoke last, ITO rests, your Honor. The Court: All right. Does anybody else want to offer anything! Mr. Cichanowiez: No, your Honor. Mr. Klonsky: I just would like the court to take judi- cial notice of the pleadings with respect to the participa- tion of Hoffman in the trial in the main as well as in the claim offer. The Court: Oh, yes. Mr. Schwartz: I should have said before I rest, I think it is manifest, though, that with respect to tie issue that we are trying at this time, that all of the testimony that is ee one eee tee amep te a ee —— — Al3 Excerpts From Transcript of Trial (Findings of Wyatt, U.S.D.J.). in this case thus far, (112) including that of Mr. Gomez taken on February 4, 1976, is before your Honor on the third-party complaint. The Court: On the claim of the plaintiff against Hoff- man, I am bound to find, and find, that Hoffman is liable to the plaintiff. I am persuaded that the raising of the boom by Hoff- man was negligent, and the testimony today of the Hoff- man crane operator confirms that he topped the boom, that is, he brought it up higher, elevated the head of the boom, without any signal from the signalman. He says that he gave a signal himself. He made the decision to do it and gave a signal to the signalman. Of course, normally the signalman’s back was turned to the crane operator. He says that he stopped. What he stopped, I don’t know what he refers to, whether he means he stopped tightening the fall or winding the cable, or whether he means he had started topping the boom and stopped topping it. But he says that when he stopped the crane operation, that caused the signalman to turn around and look at him, and he then gave a signal to indicate that he was going to elevate the head of the (113) boom. I notice that in Plaintiff’s Exhibit 13 and ITO Exhibit D —and ITO Exhibit D, at least, was a statement of the crane operator made on the very day of the accident—there is no mention of elevating the head of the boom in any way, shape or form, and there is no mention of any signal from the crane operator to the signalman that he was going to do so. On the other hand, the testimony of Gomez, the signal- man, is quite explicit. For some reason we have been furnished, or the clerk has a copy, or there is in the clerk’s file, a transcript of the testimony of Gomez, and on cross examination by Mr. Cohen, at least, Gomez unequivocally Al4 Excerpts From Transcript of Trial (Findings of Wyatt, U.S.D.J.). says that the tip of the boom was raised, the boom was topped without any signal from him, Gomez. That, of course, is confirmed by the Hoffman crane operator. | Of course, Gomez says nothing whatever about any sig- nal from the crane operator that that’s what he was going to do, and Gomez says nothing about anything being stopped and his turning around to look at the crane operator. I am bound to say that elevating the tip of the boom caused the sliding motion inshore of the (114) draft which hit one of the I-beams, which in turn fell on the plaintiff and caused the accident. So I am bound to say that the plaintiff has established liability on the part of Hoffman. As to all the other issues in the case and how we resolve this, fairness and equity and justice, it seems to me, are served if the recovery of the plaintiff or if half the dam- ages—and if it is necessary to fix damages I am going to accept the jury’s verdcit in that respect—half of the dam- ages ought to be borne by the stevedore and half of the damages ought to be borne by Hoffman, the crane operator. In the midst of all this welter of Second Circuit law, claims, counterclaims and cross claims and direct claims, I don’t know how I can pick my was to accomplish that result, but that is what I have to figure out. Mr. Klonsky, do you know how it can be done? If I give you a judgment in the full amount against Hoffman and you got a judgment in the full amount against the shipowner, obviously you can’t recover twice. Mr. Klonsky: That’s right. The Court: What happens? Do you then (115) have your choice as to whether you collect everything against Hoffman? Mr. Klonsky: I have no choice, your Honor. But I would defer to Mr. Schwartz, who has much more experi- ence in third-party cases than I have. — es 0 ESOS Al5 Excerpts From Transcript of Trial (Findings of Wyatt, U.S.D.J.). I usually stop when I sue the defendant. I have no in- terest in going beyond ordinarily. But Mr. Schwartz has been beyond many times and I would defer to his thoughts on this subject, your Honor. Mr. Schwartz: I refuse to be amicus to the plaintiff, your Honor. The Court: But you ought to be amicus, Mr. Schwartz, to the court. Mr. Schwarz: I think there is something else that you might take into consideration, your Honor. I don’t think you are making new law or it is pioneer justice ; I think it is a question of equity too, as your Honor indicated. Your Honor has indicated at the outset of today’s ses- sion that we are being held—when I say “we,” it is ITO— are being held liable because the negligence of our em- ployees is imputable to us and which constitutes a breach of the warranty of workmanlike (116) services that we owe the shipowner. The Court: That’s right, under Rodriguez. Mr. Schwartz: Your Honor cited our own Rodriguez ease, which has just been decided. The Court: That’s right. Mr. Schwartz: If that is the law, that the United States Supreme Court finally holds is the law, despite the fact that there are differences of circuit opinions on this question but nonetheless the Second Circuit holds what your Honor has held, then I think that your Honor ought to remember that the plaintiff has been held guilty of con- tributory negligence to the extent of 15 per cent, and obvi- ously that is excused from his recovery against the ship- owner. The Court: Yes. Mr. Schwartz: So therefore in the ultimate picture, because of our employees’ negligence, that 15 per cent Al6 Excerpts From Transcript of Trial (Findings of Wyatt, U.S. D. J.). already has been subtracted from the shipowner’s liability. On the other hand, if it hasn’t been excised as your Honor views it—and you remember Judge Kaufman, when he was in the district court, had that view, that it is ex- cused—but nonetheless, if it is not excised (117) by what the subsequent cases have treated with it, then I say that the most that we should be liable, if at all, is the 15 per cent of our employees’ contributory negligence in this case, and that should be the sum total of our liability in this case, if at all. The Court: Rodriguez gives me no choice. It says all or nothing, and it says all. Mr. Schwartz: Rodriguez didn’t have co-third-party defendants. The Court: That is right. Mr. Schwartz: We were the only third-party defendant. Mr. Cichanowiez: Your Honor, I think on that point— The Court: Mr. Schwartz, what do you suggest that I do? What happens if I enter a judgment against Hoffman for the full amount and enter a judgment for the ship- owner against Hoffman and ITO, 50 per cent against Hoff- man and 50 per cent against ITO? Now, they are judgments, but how does the plaintiff get paid? If he levies on execution on Hoffman, as he could do, as I understand it, then the shipowner never, (118) never gets any recovery or never pays anything. Therefore, the shipowner has no claim-over and Hoffman ends up stand- ing 100 per cent of the loss, which to me seems inequitable and it is not what I want to bring about. Mr. Schwartz: I think your Honor has put his finger on a thorny problem that concerns all of us and I don’t know that I have the answer to it. Al7 Excerpts From Transcript of Trial (Findings of Wyatt, U.S.D.J.). I do appreciate fully that an entry of a judgment against Hoffman, which your Honor has indicated the plaintiff is entitled to, exposes Hoffman to having to satisfy that judgment wholly to the plaintiff. The Court: That’s right. Mr. Schwartz: In which event the shipowner has come away clean with respect to any payment it has to make, with the exception of counsel fees, which is a question for your Honor’s determination yet. The Court: Yes. And I have— Mr. Schwartz: But the shipowner comes out whole. What Hoffman’s rights are with respect to ITO, if your Honor were to find 50-50 liability to the shipowner, what Hoffman’s rights are where they pay the judgment to the plaintiff because they are a (119) direct defendant to the plaintiff, I don’t know the answer to that. And yet the plaintiff has made out his case against Hoffman as your Honor has held. The Court: Yes, that’s right. Mr. Schwartz: By the same token, we are in an ad- miralty court, we are applying maritime law, despite the fact there was diversity of citizenship which gave the plaintiff the right to have his issues determined by a jury, and yet I assume that admiralty, being an equity court, might dispense equity so that result does not obtain. But I don’t know the answer to your Honor’s qnestion. The Court: I suppose that one thing I could do— whether the Court of Appeals would approve of it is an- other matter—I would enter a judgment, vacate the present judgment against the shipowner, enter a judgment against the shipowner for 50 per cent of the total amount, enter a judgment against Hoffman for 50 per cent, hoping that the plaintiff can recover from both, and enter a judgment fe the shipowner for 50 per cent—for all of the judg- Al Excerpts From Transcript of Trial (Findings of Wyatt, U.S.D.J.). ment against ITO and 50 per cent of the counsel fees against ITO and 50 per cent against Hoffman. That would wind up with the result that I want to accomplish. (120) Mr. Klonsky: Maybe they can stipulate to that result and let the Court of Appeals find out whether that should stand on liability only. The Court: I think that’s what I will do, whether it is stipulated to or not. Mr. Cichanowiez: Your Honor, there is a case in the Second Circuit, Hartnett against Reis, in which the ship- owner was held liable and then he was allowed 50 per cent recovery against two co-stevedores. That way, ap- parently, would be no problem. The finding against Hoffman may create a problem. Mr. Klonsky: The trouble is, your Honor, that they cannot be treated as joint tort-feasors, the stevedore and Hoffman, because the stevedore could not be sued directly by the plaintiff inasmuch as he is the employer, and an employer is not a joint tort-feasor. That is the major problem as I see it to give any clear resolution of this. (125) Arrernoon Session (2:30 p.m.) The Court: I have read the Hartnett case, I guess, which is the grain case from Buffalo. I have read the opinion of the Court of Appeals. In a situation very similar to our own, the Court of Appeals approved an equal division of liability as between parties who correspond to ITO and Hoffman here. It is a 1970 case and the records are presumably in a warehouse so that I have no idea what the judgment looked like. A9 Excerpts From Transcript of Trial (Findings of Wyatt, U.S.D.J.). At any rate, it seems clear that the judgment which has already been entered against the shipowner, Olden- dorff, for $310,250 should stand. If Oldendorff does not pay that judgment, then of course Oldendorff has no indemnity as against the other parties, nor will Oldendorff receive its counsel fees unless its pays the judgment. But if the shipowner pays the judgment, then the ship- owner may recover 50 per cent against ITO plus 50 per cent of counsel fees, and may recover 50 per cent against Hoffman plus 50 per cent of counsel fees. (126) There may be judgment for $310,250 against Hoff- man. If Hoffman pays the judgment, Hoffman is entitled to recover 50 per cent ITO and an appropriate judgment may reflect that. All other claims and cross claims or any claims, cross claims, counterclaims inconsistent with this are dismissed. The parties may either agree on the form of judgment or judgments or they may submit them on notice. I don’t think we need to do anything else. Mr. Schwartz: I would like to, before we conclude, your Honor, having talked to Mr. Blanc, there is something that is left open here which lends itself to some disposition by your Honor. Mr. Blane and I have agreed—have we not, Mr. Blanc? —that this crane and whatever came with it was ordered from Hoffman by ITO as the customer. Mr. Blane: Correct. Mr. Schwartz: And with that in mind, your Honor, I respectfully, knowing that your Honor has pretty much disposed of the claims, call your Honor’s attention to the fact that in our answer ITO has a cross claim against Hoffman for breach of its (127) expressed and implied warranties to us with respect to the operation of the crane that we ordered from them, and I say to your Honor most A20 Excerpts From Transcript of Trial (Findings of Wyatt, U.S. D. J.). respectfully that having been case into liability under the Rodriguez case because of the negligence of our own em- ployee, that in equity and in conscience and under the law we should be entitled to indemnity from Hoffman because it, by its actions, has cast us into liability for whatever we are called upon to pay in this case. The Court: No, you are not entitled to anything. I don’t believe there was any express or implied warran- ties from Hoffman and you are entitled to nothing and will take nothing as against Hoffman, because I want to leave and I think my dictated result will leave 50 per cent of the liability on ITO and 50 per cent on Hoffman. I still don’t know the technical or admiralty forms of the formal judgment papers or decree. Mr. Schwartz: At lunch, with the exception of Mr. Blanc, Mr. Klonsky, Mr. Cichanowiez and I kicked around the form of a judgment that might carry into execution your Honor’s disposition, even though I respectfully dis- agree with my not having a right over (128) as against Hoffman. If we can go off the record and use that blackboard for a moment, if your Honor wishes to spend the time, per- haps we can agree on a form of judgment. The Court: All right. Certainly. I will contribute my energy and strength if it will help in any way. (Discussion off the record.) Mr. Cichanowicz: Your Honor, may I note an exception to the portion of your Honor’s ruling in which apparently counsel fees, defendant’s counsel fees, are contingent upon the defendant paying the judgment. The Court: All right. I think I have done as much as I can do. All right, Mr. Clerk, we will be in recess. — U — A21 Statutes Involved TITLE 28, APPENDIX.—RULES OF CIVIL PROCEDURE Rute 50.— Moriox ror a Direcrep VERDICT AND FOR JUDGMENT NOTWITHSTANDING THE VERDICT (a) Motion for directed verdict; when made; effect. A party who moves for a directed verdict at the close of the evidence offered by an opponent may offer evidence in the event that the motion is not granted, without having reserved the right so to do and to the same extent as if the motion had not been made. A motion for a directed verdict which is not granted is not a waiver of trial by jury even though all parties to the action have moved for directed verdicts. A motion for a directed verdict shall state the specific grounds therefor. The order of the court granting a motion for a directed verdict is effective without any assent of the jury. (b) Motion for judgment notwithstanding the verdict. Whenever a motion for a directed verdict made at the close of all the evidence is denied or for any reason is not granted, the court is deemed to have submitted the action to the jury subject to a later determination of the legal questions raised by the motion. Not later than 10 days after entry of judgment, a party who has moved for a di- rected verdict may move to have the verdict and any judg- ment entered thereon set aside and to have judgment entered in accordance with his motion for a directed ver- dict; or if a verdict was not returned such party, within 10 days after the jury has been discharged, may move for judgment in accordance with his motion for a directed ver- dict. A motion for a new trial may be joined with this motion, or a new trial may be prayed for in the alternative. A22 Statutes Involved. If a verdict was returned the court may allow the judgment to stand or may reopen the judgment and either order a new trial or direct the entry of judgment as if the re- quested verdict had been directed. If no verdict was re- turned the court may direct the entry of judgment as if the requested verdict had been directed or may order a new trial. --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385004_1512%3A1. Public record. Not legal advice.