# Brief for Petitioner — Waterman Steamship Corp. v. Dugan & McNamara, Inc. > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386409_0299%3A4 ## Record - **Collection:** Supreme Court brief - **Document type:** Brief for Petitioner - **Published:** January 1, 1960 - **Citation:** 364 U.S. 421 ## Text : - re » = . IY ae : tL ‘B motion for rehearing, and heard reargument before the court en banc to consider the effect of the :‘Crumady decision upon the present appeal (R. 31). Brief for Petitioner - 5 On November 17, 1959 the Court of Appeals decided, with the Chief Judge and two other members of the court dissenting, that the Crumady. decision, did not alter the requirement of contractual privity between the shipowner and the stevedore unless the stevedoring company, as in Crumady, had entered into a contract with the operator of the vessel (R. 32 to 35). The contract in the present instance. having been made by the stevedoring company with the con- signee of the cargo, the Court of Appeals affirmed the judgment of the Court below (R. 35). ' 429 as follows: 6. . Brief for Petitioner ARGUMENT. The Shipowner Is Justly Entitled to Benefit by the Steve- dore’s Warranty of Workmanlike Service sit Regard to Contractual Privity. The principle that the shipowner is entitled to benefit by the stevedore’s warranty of workmanlike service with- out regard to contractual privity has already been decided by this Court. In Crumady v. The Joachim Hendrik Fisser, et al. v. Nacirema Operating Co., Inc., 358 U. S. 423 (1959), the services of the stevedore had. been contracted for by the charterer, as operator of the vessel. A longshoreman was injured due to substandard performance by the stevedoring . company’s employees, who brought into play, a hazardous and unseaworthy condition of the ship’s winch controls. The l!ongshoreman recovered damages against the ship- . owner. This Court found that the shipowner was entitled to full indemnity from the stevedore, stating at pages = ‘‘A majority of the Court ruled in Ryan Co. v. Pan-Atlantic Corp., 350 U. S. 124, that where a ship- owncr and stevedoring company entered into a service agreement, the former was entitled to indemnification | for all damages it sustained as a result of the steve- _ doring company’s breach of its warranty of workman- ‘like service. And see Weyerhaeuser S. S. Co. v. - Naci- rema Co., 355 U. S. 563. * * * ‘*We think this case is governed. by the principle .announced in the Ryan case. The warranty which .a stevedore owes when he goes aboard a vessel to per- - form services is plainly for the benefit of the vessel whether the vessel’s owners are parties to the contract or not. That is enough to bring the vessel into the eee ts eee A a | , Brief for Petitioney 8 =. . °° 7 zone of modern law that recognizes. rights in third- _ party beneficiaries. Restatement, Law of Contracts, Sec. 133. Moreover, as we said in the Ryan case, ‘com- petency and safety of stowage are inescapable elements of the service undertaken.’ 350 U.S. at 133. They are part of the stevedore’s ‘warranty of workmanlike service that is comparable-to a manufacturer’s war- ranty of the soundness of its manufactured product.’ Id. at 133-134. See MacPherson v. Buick Motor Co., ‘217 N. Y. 382, 111 N.-E. 1050. ‘‘We conclude’ that since the negligence of the stevedores, which brought the unseaworthiness of the | vessel into play, amounted to a breach of the warranty _ ‘of workmanlike service, the vessel may recover over.’’. (Emphasis supplied.) The only factual difference between this case and the Crumady case is that in the present case the stevedore was engaged by fhe consignee of the cargo, rather than by the © operator of the vessel as in Crumady. Such factual dif- ference is immaterial, and indemnity should be granted to the shipowner (petitioner herein) just as it was in the Crumady case. The attempt of the Court of Appeals for the Third Circuit to restrict the holding of this.Court in. . the Crumady case.to contracts between the stevedore and - an operator of the vessel is unjustified. In attempting to © ‘do so,.the Court below stated (at R. 35): ‘‘Thus, the actual holding of the Crumady case seems to be that a contractual undertaking of the stevedore with the operator of a ship, who is not the owner, to unload in a safe and workmanlike manner inures to the-ship. In contrast the case now before us - affords no basis for finding or assuming that the op- - erator of. the ship had any dealing whatever with the stevedoring company which discharged the cargo. To the contrary,.as already pointed out, the District Court indicated and counsel have represented that the car- & . Brief. for Petitioner ; riage was on such terms and conditions that the con- signee was responsible for the discharge of: its own ‘goods and arranged with the stevedoring company-fer—— the performance of that job. The shipowner and the stevedoring company were strangers. It necessarily follows that the alleged duty upon which the present claim rests can only be an imposition on a wrongdoer in invitum. It is a question of tort liability, rather than. one of contract or warranty, whether either wrongdoer must share the burden of a recovery by the _injured party against the other wrongdoer. In reality we have here a problem of contribution between tort- ‘feasers and not one of indemnification for breach of warranty.’’ (B. 35) This misconception of the reasoning involved in the Crumady decision completely disregards the right of the shipowner as third-party beneficiary. Nothing in the lan- | guage used by this Court in the Crumady case suggests an intention to limit the third-party beneficiary principle to contracts by stevedoring: companies with ship operators. | In the Ryan case this Court stressed the obhigation of the - stevedore to perform the contract in a workmanlike manner and allowed indemnity to the shipowner for. breach of the stevedore’s warranty of workmanlike service. In the Ryan case, the question of contractual privity did not: arise, be- . - cause the shipowner had directly engaged the services of the stevedore. In the Crumady case this Court again ap- plied the analogy. of the manufacturer’s warranty to the stevedore’s service and held that this warranty inured to the benefit of the wn sateen regardless | of contractual privity. . The Court of Appeals fer ‘the Third Circuit erred in failing to recognize that the privity rule had already been rejected by this Court, and then misapplied the Crumady décision by attempting to limit its scope. Nof can this case and the Crumady. case be distin- guished on the oan that the action in Crumady was : . Brief for Petitioner es 9 against the vessel in rem, since the shipowner, whether he is sued in personam or defends as claimant of the vessel, in a suit in*rem, sustains like damages in either case as the result of the stevedoring. company ’s breach of warranty.‘ The Court below also erred in concluding that the ship- . owner and the stevedoring company in this case were “strangers”? and that petitioner (shipowner) is, in effect, a joint tortfeasor barred from recovery of contribution. -Rather than representing a ‘‘prohibited misuse ‘of the con- cept. of indemnity to obtain contribution,’’ this case is identical in principle with ‘the Crumady case. The concept of. a shipowner as ‘‘stranger’’ to the stevedore who discharges the cargo from his vessel, requir- ing the stevedore to make use of the ship’s equipment and generally to perform one of the traditional duties of the © crew, Gannot be accepted. Although the stevedore may not contract directly with the shipowner, he does not come aboard the vessel as a trespasser. Someone having a direct “¢nterest in the business of the vessel has contracted for the stevedoring services, and whether the contract was made by the shipowner, the ship’s operator, or the consignee of . the cargo, the work of the stevedore is ultimately for the benefit of both the shipowner and. himself:’ He comes. . aboard with the same authority to carry out the work as though the shipowner had directly contracted for the work * and requested him to perform the services in a safe, proper — and workmanlike manner. Finally, in principle, irrespective of the Coun case, ‘the shipowner is entitled to indemnity from shore con- tractors regardless of contractual privity. The shipowner’s absolute and non-delegable duty. to furnish a seaworthy vessel and equipment impuses a unique 4. Crumady sued Steamship Joacnim Henprik Fisser, her engines, etc., in rem, and her owners Joachim Hendrik Fisser and/or Hendrik Fisser in personam. - No service was made upon the indi- vidual respondents in personam. Upon attachment of the vessel in rem, Hendrik Fisser Aktien Gesselschaft ane as owner and claimant. 10 Brief for Petitioner . and burdensome form of liability without fault. The ship- " owner, or’ the vessel in rem, is liable not only for furnishing unseaworthy premises and gear to workmen, but it has been held that liability for injuries to shore workmen. may arise from accidents caused by defective appliances brought aboard by their own employer, Alaska Steamship Co. v. ” Petterson, 347 U.-S. 396 (1954), and for the misuse of sea- worthy equipment. by longshoremen, Grillea. v. United . States, 232 F. 2d 919 (C. A. 2, 1956). As. the orbit of ‘liability increases, there is a corresponding increase of in- . stances where the absolute liability of the vessel or ship- owner for injuries caused by unseaworthiness is due en- tirely to the fault or acts of others. The.-exposure of ‘the shipowner to such claims is in- creased by his lack of actual control over the circumstance which create his liability. Merchant vessels are commonly . placed by charter under the contro! of others than the ship- owner, and charterers often transfer control and manage- ment of their ships to one or more subcharterers. Foreign owners frequently have no direct contact with the aperation . of their ships in American waters for months at a time. Such far-reaching responsibility of the shipowner for the use of his véssel places him at an extreme. disadvantage in dealing with claims of injury to shore workers drising, from unseaworthiness, when such claims are due to sub- standard performance by shore contractors whom the ship- owner did not.employ, and. with whom he had no actual privity. To deny indemnity in this situation is unjust and unreasonable. Every shipowner is entitled to indemnity for losses created by substandard. performance ‘by shore - - _ contractors, by virtue of his constantly i increasing risk of - loss under the warranty. of seaworthiness which imposes . liability without fault. Absence of contractual privity does not justify setting up a separate standard of recovery. If the decision of the Court below is to stand, two . identical ships at adjacent piers, employing the services of the same stevedoring company for loading or discharging o Brief for. Petitioner Can the same type of cargo; sued by longshoremen for injuries resulting from identical conduct amounting to breach of the stevedore’s warranty of workmanlike sérvice, would be al- . lowed-or denied indemnity solely on the point of privity. . If the shipowner or operator of one ship had engaged the services of the stevedore, indemnity, wquld be allowed. If the consignee of the cargo on the other ship had engaged the services, indemnity would be denied. ‘This result is neither at nor realistic. CONCLUSION. ‘The third-party beneficiary principle invoked in the ~ Crumady decision (which controls this case) represents a. logical and orderly development of contract law in the field - of maritime relationships and furnishes needed relief to all shipowners: exposed to the risk of loss by injury to shore workers through substandard performance of stevedoring contracts. It is not limited, as the Court of Appeals for the Third Circuit has held in this case, to owners and operators of ships, but applies to any contract which the stevedore -may make, under which he goes aboard the vessel to render services. The law has been simply and directly stated by this Court in a en case (358 U. S. at 428) as fol-. lows: _- _ ie warranty which a stevedore owes when he goes aboard a vessel to perform services is plainly for the benefit of the vessel whether the vessel’s owners are parties to the contract or not. That is enough to: bring the vessel into the zone of modern law that recog- nizes rights in third-party beneficiaries.”’ Petitioner submits that the Court below erred in hold- ing as a matter of law that petitioner, as shipowner, had no right of indemnity against the respondent stevedore without being a party fo the contract for the services which were being performed aboard Steamship Arounpria when the longshoreman was injured, thereby causing loss to the 12 mt aad Petitioner — shipowner through alleged substandard ‘performance by — the stevedoring company. — Petitioner respectfully requests this Court to reverse the decision-of.the Court of ‘Appeals for the Third Circuit, and to remand the proceeding for a new trial on the issue of substandard performance which was not submitted to the jury because of the summary-judgment on the question of privity. , Respectfully ‘submitted, - THomas F. Mount, Harrison G. Krpare, Gzorcz M. BropHeap, — J. Weties Henpenson, Counsel for Petitioner. Dated: August 15,1960. Philadelphia, Pennsylvania. --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386409_0299%3A4. Public record. Not legal advice.