Opposition Brief — Atlantic & Gulp Stevedores, Inc. v. Ellerman Lines, Ltd.

*

A

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QUESTION PRESENTED . pak anes Pere re rte Pe ease Seer e

STATUTE INVOLVED ;......cccccocs AEA Er Ra EPO es

ARGUMENT im eeeee os eeeeeee Aaa He eoeeeeveeree ee

. A. Petitioner Ps Not Deprived of a Jury Trial as a Matter

| NE RE a Sade dbsevagesspiserdecyectavaceacas Me

B. Respondent’s. Suit in Adwiivalty Had a Levitineie Pur-

pose and Will Not Result in Needless a of

Litigation .........csececcsccccccesecdeccscceios

Cc. Respondent’ s Action Was Not Pian The Deci-+

sion Below Is Perfectly Consistent With the Doctrine

of Indemnity Enunciated by This Court, and With

_Other Appellate Decisions ..... paighiateecadeeceee “1

_D. Petitioner’s.Obligation to Indemnify ‘dagen Arises

‘From a Maritime Contract. Accordingly, Respondent’s

Indemnity Action Is Within the Admiralty Jurisdiction

CoNCLUSION RP Pret ne are teas eeeoerveevevee baie le eeeeeeeevesr ae

TABLE OF CASES CITED.

American Stevedores, Inc. v. Porello, 330 U. S. 446 ........ ee

Atlantic ‘& Gulf Stevedores, Inc. v. ne Lines, 369 U.’S.’

TSMR IITs gece at ialep aa RYE SCR nT (gOS en .. 4,10

' Brown v. San Alberto Cia, Armadora, S. A:, 305 F. 2d 602

Oe nie a ow eanupasuuecade wae

Crowell v. Benson, 285 U. S. 22 ....... Saha ee RE,

- Crumady v. The Joachim Hendrik Fisser, 358 U.S. 423 ....7,9,.10

De Gioia v. United States Lines Company, 304 F. 2d 421

Oe Se ED 5 va es aden dan deh esidiieak Ganrnces 5

Guarracino v. -Luckenbach S. S. Co., 333 F. 2d 646 (C. A. 2, 3

EE kuncn Wana obs dees tteNbebncéeviseaassedecianns 8

Massa v. C. A. Venezuelan ie ates 332 F. 2d°779 (C. A.

Sj Prervvrer PAPO RE. ETO OPP eT NN Gene Tee 5,8

Nicroli v. Den Norske Afrika- Og Australiclinie, Etc., 332 F. 2d

Or i ras oi skis ceca aes aa

| Paliaga v. Luckenbach S. S..Co,, 301 F, 2d 408 (C. A. 2,

WE haseies, Bei aeuirit aces clea evab eis 5,7.

Regefs v. United States Lines er 303 F. 2d 295 (C. A.

3, 1962) .....eeeeeeeeeees Mavi Mia kkwdkbacatadeoeen 5

‘Romero v. International Terminal Operating Co., 358 U. S. 354 10 -

Ryan Stevedoring Co. v. Pan-Atlantic S.‘S. sass ., 350: U. S:

' ER visitas A SOE OPN PPO y e oe

Strachan Shipping Co. v. ‘Koninklyke Nederlandsche S. M.,.

_ ON. V., 324 F. 2d 746 (C. A. 5, 1963), cert. denied 376

8

Unexcelled Chemical Corporation v. United States, 345 U.S.59 | 8

United States v. Atlantic Mutual Insurance.Co., ae U~S. as 8

Waring v. Clarke, 5 How. 441 ead oes whw eeu eh aewe ea 4

Waterman S. S. Corp. v. Dugan & McNamara, Inc., 364 U. S.

Sele te tf Oat e Searfee RORDpS < CO Re Ee? Pn 7,9

Weyerhaeuser S. s. ‘Co. v. Nacirema Operating Co., 355 U. 5:

Bc cease nats cideeccekaebeccesaskoussseesen 7,9

MISCELLANEOUS. e

Act of beats 25, 1948, c. 646, 62 Stat. 931, sini May 24,

3909; c.: 13D, 7B, GE Beek, WOE. hac cccccccpecesceacss “a

28 U. S.C. $1898.00 :.02s2000ees3- are ee ee acre 2,4

United States Saas Seventh Amendment .....4..... -

IN THE’

Supreme Court of the United States.

Chena Tam, _—

No. 1087. .

- ATLANTIC & GULF STEVEDORES, INC,

“Petitioner, io

v.

ELLERMAN LINES, LTD., - . |

. Respondent.

BRIEF FOR RESPONDENT IN | OPPOSITION, -

Respondent on not inate gutiilineas statement of |

the ‘*Opinions Below’’ and ‘‘ Jurisdiction’’. -Howeyer, re- -

spondent finds it necessary to state its own view of the

question presented and to supplement and correct certain

~ statements made in petitioner’s ‘‘Statement of the Case eA

Respondent also believes that a statute is involved.,,

-’- ° . QUESTION PRESENTED.

| Where a shipowner sued a stevedore’ con

admiralty for indemnity, alleging that the s

breach of its contractual obligation to the shipo

-- eaused the shipowner to incur losses and expenses and that a

the shipowner will be compelled. to incur further expenses

_ and may be compelled to pay a judgment in favor of an _

injured longshoreman, did_net the libel state a cause of

action within the admiralty jurisdiction’,

2

Brief for Respondent in Opposition

. + "

STATUTE INVOLVED.

a

. 28 U. s. x $1333 p provides i in relevant part:

d ‘The district @ courts shall have original Minto.

| tion, exclusive of the courts of the. States, of :.

(1) Any civil case of admiralty or mari- ,

_ time jurisdiction, saving to suitors i in all cases all.

_ other remedice to which _ are otherwise en- |

titled. .

-Aet of pa 1948, ¢. 646, 62 Stat. 931, amended

May 24, 1949, c. 139, § 79, 63 Stat. — -

: s

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—w——

; : Brief re Respondent in’ Opposition: 3

|" STATEMENT OF THE CASE.

-Petitioner’s statement does not disclose the. nature of

the claim asserted in respondent’s libel, which must be

clearly understood at the outset.

Respondent did not'seek recovery from petitioner for :

the injury caused to petitioner’s employee, Eckles. Rather, ~~

-_ respondent’s libel sought recovery for the losses and dam-

ages caused to respondent by petitioner’s breach of its

contractual duty to perform its services in a competent and

workmanlike manner. .

Specifically, , respondent ini that asa result of

. Kckles’ injuries,:respondent had been compelled to expend

money in the investigation and defense of Eckles’ suit; that

respondent would in the future, ur further similar ex- |

" penses, and might ultimately be! dompelled to pay. a judg-

ment. in Eckles’ favor (Libel, par. 8). It was for these

items of loss and damage that caesar sought ryoattead

from petitioner. _-—_-

_~ Petitioner states that ‘‘. . Respondent rendginieed

‘that no contractual obligation w was specifically undertaken’

It relied instead upon an implied obligation extrinsic to - ee

the contract between the parties’? (Petition, P. ae

-. This statement. of respondent’s position is: inaccurate

or, at least, highly ambiguous. .Respondent in fact relied

upon an obligation of petitioner which was of the essence

' of the contract between the parties:’ In no sense was peti- ~

tioner’s obligation .‘‘extrinsic’’ to the contract.

~

2

peti Ones tae wane we

ba ‘

ee : Brief for Respondent in Opposition

ae

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A. Petitioner Is Not t Deprived of a a Jury Trial as a.

, Matter of Right: ~

Petitioner sini that. it has been deprived of a jury

trial as a’matter of right. This is an extravagant asser-

. tion for which there is no support... : :

Petitioner ignores the fact that 28 U. S. C. § 1333, |

quoted above, afforded respondent & choice of remedies.

Respondent could, and did, bring suit in admiralty. Re-

- gpondent could: also have sued petitioner on the civil side

_ by impleading petitioner in Eckles’ civil suit, which peti-

tioner would apparently have preferred. Respondent did

- not exercise .the lattes option, and its decision cannot be

the basis for complaint. | ,

_ As recently as Atlantic & Gulf Sievedoved, Inc. v.

Ellerman Lines, 369 U. S. 355, this Court reaffirmed’ that

a cause of action such as that here asserted by respondent

_ may. be sued upon in admiralty, ¢ or on the civil side (at>»

369 U.S. 359-360).

Ever since Waring v. Clarke, 5 How. 441, it has been

- gettled that the Seventh Amendment aides not require jury

- trials in admiralty. cases.

In this context, the fact that ainisnes have on some:

‘past occasions asserted their indemnity rights against

: stevedorescontractors i in civil actions, with trial by jury, is

irrelevant. Equally irrelevant are the cases cited by peti-

tioner (Petition, p. 8), where the ene ’s rights were

adjudicated in civil actions.

- -The point is that if, as will be conclusively dent.

strated, the subject matter of respondent’s libel was withis

the admiralty. jurisdiction, petitioner had no right to a jury

trial. Petitioner cannot assert the deprivation of a right

which never existed. :

C., Brief for Respondent in Opposition —s_‘5

. B, Respondent's Suit in Admiralty Had a Legitimate Pur-

pose and Will Not Result in or Multiplicity. of

Litigation.

Petitioner seizes upon the Coutt ‘of Appeals’ charac-

terization of respondent ’s. suit in admiralty as a ‘‘tactical

maneuver’’. If it were such, it is certainly not a ‘‘mane

_ver’’ deserving condemnation, nor did the Court - Appeals >

"g0 view it, |

The. shipowner’s ethene recovery - tevin a stevedore

contractor includes reasonable counsel fees and necessary -

: expenses incurred inf the defense of the injured longshore-

man’s suit. Brown v. San Alberto Cia Armadora, S. A.,

305 F. 2d 602 (C. A. 3, 1962); Paliaga v. Luckenbach S. 8.

Co., 301 F. 2d 403 (C. A. 2, 1962); Rogers v. United States —

Lines Company, 303 F. 2d 295 (C. A. 3, 1962). The recoy- <

ery includés counsel fees and expenses incurred on appeal.

De Gioia v. United States Lines Company, 304 F. 2d 421

426-497 (C. A. 2, 1962); Massa v. C. A. Venezuelan Nati”.

. gacion, 332 F. 2a 779, 782 (O. A. 2, 1964); Nicroli v. ‘Dik

Norske Afrika-Og Australielinie, Ete., 332. F. 2d 651, 656

* (C. A. 2,.1964). —s

Obviously, fact questions are ici in ‘dilieulalen:

“ the reasonableness of cpuncel fees and - bog rte for

seems to respondent i incongruous to siti ary issues aitér-

_mined by a jury. Conversely, it would be difficult to con-

ceive of a set of issues more appropriately determinable.

by the Court, as can be accompanied in an admiralty

action. Roe ie

\ Moreover, it weal by definition be impossible for any

‘jury, at the trial of the injured longshoreman’s suit against

the shipowner, to assess the reasonable value of the ship- _

owner’s,counsel fees and expenses which had not yet ac-

crued, including those which might accrue on appeal and

in other post-trial proceedings. Again these are matters

6° Brief for Respondent in Opposition

“peculiarly appropriate oe the Court's ultimate deter-

_ mination.

The foregoing are certainly leditinate. considerations -

; in determining respondent’s

oice of its remedy.

- Needless multiplicity of litigation is not involved in

_. Fespondent’s suit in admiralty in any realistic sense. As

». the Court of Appeals suggested, sound judicial adminis-

.- tration would militate for consolidation of the present pro-

_ ceeding with Eckles’ civil suit against respondent. Cer-_

tainly \there is no legal impediment to this eee een

it were ‘followed, the end result would be no greater b

upon the Court or the parties than if respondent had elected

to sue petitioner via a third- party —— in Eckles’

pending civil suit. *

C. Respondent’s Action Was Not Premature. The Decision.

; Below Is Perfectly Consistent With the Doctrine of

. Indemnity Enunciated ‘by This ied and With, Other

Appellate Decisions.

Petitioner asserts that the convept of iitdeuine enun-

. ciated by this Court in Ryan Stevedoring Co. v. Pan-

‘Atlantic S. S. Corp., 350 U. 8. 124, was one of. indemnity

against ‘‘liability’’ as opposed to indemnity against ‘‘loss

en .

or damage’’. According to petitioner;this ‘means that. _

respondent has no right of indemnity until it be held ‘liable

to Eckles, the injured longshoreman. Therefore, peti-.

tioner argues, the present action is premature since re-

spondent’s apace _ Eckles has met as ti heen ad-

judicated.

This line of reasoning shiartn jien' an henenieih major

oivinhee Neither this Court, nor any other appellate - ;

court, has ever held or intimated that: ore con-

-tractor’s obligation to indemnify the shipowner i is limited

~ to indemnification. “against liability, as distinguished from

indemnification against loss or damage. Actually, this

Court held in Ryan that the stevedore’s obligation is ‘to

¥

| | ae |

Brief for Respondent in Opposition * Re dee

In Ryan, this Court defined the’ stevedore contractor’s oft

- assumption. of responsibility to the shipowner to include

~~

‘‘the discharge of foreseeable damages resulting to the ship- .

_ owner from the contractor’s improper performance .. .”’

(at 350 U. S. 129, footnote 3; emphasis supplied).

si Wegerhaeuser 8. 8. Co. v. Nacirema Operating Co.,

355 U. S. 563, the same language was used to describe the _

scope of the stevedore *g) indemnification liability (at 355

U.S. 565). \y

In Crumady »v. The Jeutia a endrik Fisser, 358 U.S.

423, this Court restated the Ryan doctrine to mean that a

shipowner i is ‘‘entitled to indemnification for all damages

- it sustained as a result of the stevedoring company’s breach

of its warranty of workmanlike service’’ (at 358 U. S.-428; -

emphasis supplied). Similar language was used to define an

the nature of the stevedore’s obligation in Waterman 8. S. .

: Corp. v. Dugan & McNamara; Inc., 364 U.S. 421, 423.

In the face of these clear pronouncements, it cannot

be contended that® the stevedore’s indemnification obliga- ©

“ tion extends merely to liability, as distinguished from loss _

Or.damage. This Court has ey spoken conclusively to

the contrary. ne. —

Moreover, if petitioner were correct that it i. no

‘obligation to indemnify respondent until Eckles has ob-

tained a judgment against respondent, this would obvi- a

ously negate, for instance, any indemnification liability i in.

‘eases where the injured. longshoreman’ 8 suit against the

shipowner has been concluded via settlement. Waterman -

8. 8. Corp. v. Dugan & McNamara, Inc., supra; see, also,

_ Paliaga v. Luckenbach 8. 8. Co. supra, ©

' Finally, petitioner’s argument is contrary to the-yni-

- form body of appellate authority which recognizes that the

stevedore’s obligation i is exactly what. this Court has said

_ it.is—that is, an obligation to indemnify the shipowner

‘against loss or damage, rather than against liability only. .

This principle is illustrated by cases-holding that where .

the shipowner successfully defends against the injured long- ey

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8 _ Brief for Respondent in Opposition

shoreman’s suit, it can'neverthaess recover its costs and

expenses involved in the effort if the occasion for them was

a breach: by the stevedore of its warranty of workmanlike

service. Strachan Shipping Co. v: Koninklyke Neder-

landsche 8S. M., N. V., 324 F. 2d 746. (CG. A. 5,:1963), cert.

= _ denied 376 U. 8. 954; Guarracino v. Luckenbach 8. 8. Co.

333 F. 2d 646 (C. A. 2, 1964) ; Masih v. C. A.. Lb sesmesend fet

Navigacion, supra...

The present libel alleged pants airoday diisthined by

: respondent i in the form of expenses already incurred in the

"investigation and defense of Kckles* claim. It also alleged

that. the damage resulted from petitioner’s breach of its

contractual obligation to respondent, Thus the essential Ae

. elements of a present ¢ cause of action ‘clearly appear.

_ “fhe fact that petitioner’s breach. of its contractual

Cegaioe has not been proyed is immaterial. This, as

.the Court of Appeals correctly observed,*is a matter for |

‘ subsequent proof under the adequate allegations of the

Jibel. Nor is it material that some of the items of damages :

~~ alleged in the libel. (such as future losses) are not as yet ~ -

iquidated. It i is ‘well established that. damages need not

de liquidated before a cause of action can arise. United

States v. Atlantic Mutual Insurance Co., 298 U..8. 483;

see, also, Unexcelled Chemical Corporation v. United States,

ond . S 59, \65. |

on clear that respondint’s libel stated a- 2

f action for indemnity upon principles announced:

epee a danidbtentiy approved by. this ‘Court, and that the libel —

was. not ‘prematare. : : a

OS

ey Petitioner's Obligation to Indemnity Srepenient penn

From a Maritime Contract. Accordingly, Respond-

_ ent’s Indemnity Action Is —" the sigan

Jurisdiction. ae

The remaining puis raised by petitioner can bé con-

veniently discussed under one naatine, since iat are in

- many respects interrelated.

“Beef for Respondent i in Onpocities yo

. Petitioner urges that boaniaie the contract hihi the

sittin did not contain any express provision requiring ~

petitioner to indemnify respondent with respect to‘ per-

. sonal injuries, the there~ is, (fo contractual. basis for respond-

ent’s suit. It-is further asserted that in any event, peti-..

3 tioner’s i indemnification liability does not arise from a

_—“tmaritime contract, and accordingly there ig, nO eee

‘Jurisdiction of respondent’s libel.

These propositions are demonstrably unsound, ‘and

amount to a bald denial of the settled law.

Ryan Stevedoring Co. v. Pan-Atlantic S. 8.- -Corp.,

". supra, established conclusively that .the stevedore con-

tractor’s obligation to indemnify the. shipowner for breach

_ _ of the former’s warranty of workmanlike Service is implied

:” in the contract, The obligation exists irrespective of the’

absence of an express provision requiring the stevedore to

indemnify with respect to personal injuries. . This Court

described the stevedore’s warranty of workmanlike service

_ 448 ‘ofthe essence”? of the stevedoring contract (at 350 ©

_ J. 8.133). How it can be argued that an action based upon

' breach of that watranty has no contractual basis defies

understanding.. iy

-, © That the shipowner’s action for indenmniiy is ta 3

’ upon the stevedore’s contractual undertaking has been ™

consistently reiterated in every case which has followed —

Ryan, including Weyerhaeuser, Crumady and Waterman,

supra, not to mention a host of lower court decisions.

Nor can there be any doubt that a shipowner’s action - :

'- for indemnity based upon the stevedore’s breach of its

: warranty of workmanlike service is within the admiralty

jurisdiction. In American Stevedores, Inc. v- Porello,. 330

_ U.S. 446, ‘this Court held that.a stevedoring contract is a

. Maritime contract within the admiralty jurisdiction, and

that the ind features of the contract ‘were in-

separable. ~

_ Proof positive of the infirmity’ of petitioner’s. position

is the fact that in Ryan and its progeny, this Court enun-

ian)

—

.10 a 3 Brief for Respondent in Opposition

o rile of deatitiia governing a shipowner's. claim

.for inde ity against a stevedore contractor. If the sub-

ject matter were not withifi the admiralty jurisdiction, this

could not have been accomplished. . It is the existence of

admiralty jurisdiction, and nothing else, which empowers

the Federal Courts to draw on the substantive law. in- ~

herent in that jurisdiction and to continue its development.

* Romero v. International Terminal: Operating Co., 358. U. S.

354, 360-361 ; Crowell v. Benson, 285 U. S. 22, 55. See, also,

. C@rumddy, supra, in which the indemnity issues, inter alia,

were decided in an-admiralty proceeding; ‘and Aflantic d —

Gulf Stevedores, Inc. v: Ellerman Lines, supra, in which.

this: Court. stated that the shipowner’s indemnity action

could be sth in regset sce (at 369 U. 8. ="

CONCLUSION.

The decision of the Court of Appeals is in all respects

consistent with the settled law. In no sense is it in conflict

- with any decision of this Court, or any other Court. of

' Appeals, Accordingly, respondent respectfully urges that

| the petition for certiorari Bedenied. _-

Respectfully submitted,

Marx D. Auspacu, -

_ Kervusey Evans: anp Byes,

21 South Twelfth Street,

‘Philadelphia, Pa. 19107 -

Attorneys fer Respondent. |