Merriweather v. Boland & Cornelius

160 N.E.2d 717, 6 N.Y.2d 417, 190 N.Y.S.2d 65, 1959 N.Y. LEXIS 1165
CourtNew York Court of Appeals
DecidedJuly 8, 1959
StatusPublished
Cited by1 cases

This text of 160 N.E.2d 717 (Merriweather v. Boland & Cornelius) is published on Counsel Stack Legal Research, covering New York Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Merriweather v. Boland & Cornelius, 160 N.E.2d 717, 6 N.Y.2d 417, 190 N.Y.S.2d 65, 1959 N.Y. LEXIS 1165 (N.Y. 1959).

Opinions

Fkoessel, J.

In this negligence action by a stevedore against Boland & Cornelius (hereinafter called Boland), the operator of the ship upon which he was working when injured, the third-party complaint of Boland against the stevedore’s employer, Pittston Stevedoring Corporation (hereinafter called Pittston), was dismissed by the courts below. We think this was error. Special Term looked to the main complaint, found that it charged Boland with active negligence and decided that Boland and Pittston must be regarded as joint tort-feasors in pari delicto. We note that among the many acts of negligence alleged are some which, if proven at the trial, would make Boland guilty of nothing more than passive negligence. This, however, as will presently appear, is not the basis for our reversal.

We are here involved in the area of maritime law in which Federal law is controlling (McFall v. Compagnie Maritime Belge, 304 N. Y. 314, 323-324, and cases cited therein). It is urged by the third-party defendant that under Federal statute and case law it is immune from liability to the ship operator in the absence of a contractual undertaking to indemnify. Section 5 of the Longshoremen’s and Harbor Workers’ Compensation Act (U. S. Code, tit. 33, § 905) provides that the liability of an employer “ shall be exclusive and in place of all other liability of such employer to the employee * * * and anyone otherwise entitled to recover damages from such employer at law or in admirality on account of such injury ” (emphasis supplied). The question is whether recovery over by a shipowner against the injured stevedore’s employer based upon common-law indemnity is “ on account of such injury ”.

In the McFall case (supra) we said (pp. 331-332) that it was not on account of the injury, pointing out that the Federal rule did not seem to be different from our construction of identical [422]*422language in the New York statute (Workmen’s Compensation Law, § 11). The shipowner in seeking recovery, we stated, “ is not suing for the damage sustained by the employee but asserts its own right of recovery for breach of an alleged independent duty or obligation owed to it by the employer as indemnitor. (Westchester Lighting Co. v. Westchester Co. Small Estates Corp., 278 N.Y. 175.) ” (Emphasis supplied.) This rule avoids the somewhat unjust result of immunizing an actively negligent employer from tort recovery and enabling him to enforce his compensation lien against such recovery, often at the expense of a passively negligent third party (see Weinstock, The Employer’s Duty to Indemnify Shipowners for Damages Recovered by Harbor Workers, 103 U. of Pa. L. Rev. 321, 322; Note, 66 Yale L. J. 581, 582-583).

Since McFall Avas decided in 1952, however, certain Federal cases have formulated a different rule, distinguishing between an independent contractual assumption of indemnity by the employer (and thus a voluntary waiver of the limited liability afforded employers under § 5 of the act) and a quasi-contractual (McFall type, active-passive) theory of indemnity. In the latter situation recovery over is considered to be “ on account of ’’ the injury and is thus held to be precluded by section 5 (Brown v. American-Hawaiian S. S. Co., 211 F. 2d 16, 18; Crawford v. Pope & Talbot, 206 F. 2d 784, 792; see Weinstock, op. cit., p. 342; see, also, Slattery v. Marra Bros., 186 F. 2d 134, 139, cert, denied 341 U. S. 915; contra, States S. S. Co. v. Rothschild, Int. Stevedoring Co., 205 F. 2d 253, 256).

While the Supreme Court has thus far not expressly adopted the above rule, it has Avritten three significant decisions on the subject- to which we uoav look for guidance. In Ryan Co. v. Pan-Atlantic Corp. (350 U. S. 124 — see 349 U. S. 901, affirmance by an equally divided court), a bare majority of five Justices held that section 5 did not preclude a shipowner from obtaining indemnity based upon the stevedoring contractor’s “ breach of its purely consensual obligation owing to the shipowner to stoAV the cargo in a reasonably safe manner ” (pp. 131-132). This obligation was implied from the contractor’s agreement to perform the work. Although the circuit court opinion (211 F. 2d 277) had used the language, if not the theory of quasi-contract, the majority of the Supreme Court took pains to point out [423]*423(p. 133) that “ This obligation is not a quasi-contractual obligation implied in law or arising out of a noncontractual relationship ”. The four dissenting Justices refused to impose liability on the employer in the absence of an express contract of indemnity, aside from the absence of any contract whatever. The dissent stated (p.-142): “ Plainly, common-law indemnity should not be used to fasten such a liability on a stevedoring company. I suppose it is for this reason that the Court purports to find an actual contract to indemnify and thus decides the case on an issue neither presented in the complaint nor considered by the trial court.” (Emphasis supplied.)

Had the majority remained silent as to the quasi-contract theory of indemnity, we would have had no difficulty whatever in reading the decision as an implicit rejection of such theory. It stated in a footnote (p. 132, n. 6), however, that it did not reach the issue of the exclusionary effect of the Compensation Act upon a right of action of a shipowner under comparable circumstances without reliance upon an indemnity or service agreement of a stevedoring contractor.’’ (Citing, among others, the Brown, Rothschild, Slattery and McFall cases, supra, and the Weinstock article.)

Although this footnote possibly left room for argument that there was still some life to the quasi-contract theory in maritime indemnity, it would be precarious for a State court to rely upon such a possibility in interpreting Federal law, particularly when the whole thrust of the opinion imports a rejection of that theory. Indeed, in a decision soon after Ryan, the Ninth Circuit Court of Appeals—which had authored the Rothschild opinion (supra) based upon quasi-contract — stated that since the question was “ left open ” in Ryan, “ we prefer not to rest our decision upon this ground” (American President Lines v. Marine Terminals Corp., 234 F. 2d 753, 757, cert. denied 352 U. S. 926; cf., however, Parenzan v. Iino Kaiun Kabushiki Kaisya, 251 F. 2d 928, cert, denied 356 U. S. 939, decided alternatively on the contract theory of indemnity).

In the second Supreme Court case, Weyerhaeuser S.S. Co. v. Nacirema Co. (355 U. S. 563), we think the question 11 left open ” in Ryan was necessarily decided. While agreeing with the circuit court dissent that the shipowner was entitled to a trial on its claim of indemnity, the unanimous opinion of the court [424]*424implicitly disapproved the dissenting Judge’s rationale, stating (p. 569): In view of the new trial to which petitioner is entitled, we believe sound judicial administration requires us to point out that in the area of contractual indemnity an application of the theories of active ’ or

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160 N.E.2d 717, 6 N.Y.2d 417, 190 N.Y.S.2d 65, 1959 N.Y. LEXIS 1165, Counsel Stack Legal Research, https://law.counselstack.com/opinion/merriweather-v-boland-cornelius-ny-1959.