Temporary Employment Services v. Trinity Marine Group, Inc.

261 F.3d 456, 2001 WL 883543
Court of Appeals for the Fifth Circuit·Decided August 30, 2001·No. 00-60064·Published·Cited by 5 cases

Opinion

KING, Chief Judge:

Petitioners Temporary Employment Services, Inc. and Maryland Casualty Company appeal from the final order of the Benefits Review Board holding them liable for compensation owed to Leroy Ricks under the Longshore and Harbor Workers’ Compensation Act and advocate a reversal of the Benefits Review Board’s decision on the merits. Respondent Director, Office of Workers’ Compensation Programs, United States Department of Labor, urges reversal on the ground that the administrative tribunal lacked jurisdiction to resolve the contractual dispute in this case. Respondent Trinity Marine Group, Inc. requests affirmance of the Benefits Review Board’s decision on the merits.

For the following reasons, we GRANT the petition for review, VACATE the Benefits Review Board’s decision, and REMAND with instructions to reinstate the original decision of the Administrative Law Judge holding Respondent Trinity Marine Group, Inc. alone liable under the Long-shore and Harbor Workers’ Compensation Act and to dismiss without prejudice the claims regarding the contractual indemnification provisions for lack of jurisdiction.

I. FACTUAL AND PROCEDURAL BACKGROUND

Petitioner Temporary Employment Services, Inc. (“TESI”) provides temporary employees and payroll services to various businesses, including shipyards. TESI and Respondent Trinity Marine Group, Inc. (“Trinity”) entered into a contract in which TESI agreed to provide temporary workers to Trinity. Pursuant to this agreement, Leroy Ricks, a TESI employee, was assigned to work for Trinity.

While working for Trinity, Ricks was injured at Trinity’s shipyard on January 11, 1993. From January 15, 1993 through April 24, 1994, Petitioner Maryland Casualty Company (“Maryland”), 1 TESI’s workers’ compensation insurance carrier under the Longshore and Harbor Workers’ Compensation Act (the “LHWCA”), 33 U.S.C. §§ 901-950, voluntarily paid Ricks’s temporary total disability compensation and medical benefits. Thereafter, Maryland controverted the claim on the basis of a doctor’s medical opinion that Ricks could return to work. Ricks then filed a claim for workers’ compensation benefits under the LHWCA against TESI and Maryland. Subsequently, at the request of TESI and Maryland, Trinity was added as an additional alleged employer to the action.

A formal hearing was held before an Administrative Law Judge (“ALJ”) on January 10, 1996. The ALJ issued a decision on November 26, 1996, awarding Ricks certain benefits; holding Trinity, as Ricks’s “borrowing employer,” solely responsible for those benefits; and ordering Trinity to reimburse Maryland for benefits that Maryland had previously paid to Ricks.

Trinity appealed the ALJ’s decision to the Benefits Review Board (the “Board”), and on December 26, 1997, the Board issued a decision remanding the matter to the ALJ and directing him to consider whether a valid contractual obligation between TESI and Trinity obligated TESI, *458 rather than Trinity, to pay the benefits owed to Ricks. On remand, the ALJ held that TESI had agreed to indemnify Trinity and that Maryland’s insurance policy contained a waiver of subrogation in favor of Trinity. Accordingly, Maryland reimbursed Trinity for the amounts Trinity had paid to Ricks and to Maryland. TESI and Maryland then appealed the merits of this ALJ decision to the Board. The Respondent Director, Office of Workers’ Compensation Programs, United States Department of Labor (the “Director”) challenged the jurisdiction of the administrative tribunal to decide these contractual issues. Rejecting the Director’s jurisdictional challenge, the Board affirmed the merits of the ALJ’s decision on June 8, 1999. Subsequently, the Board denied a motion by TESI and Maryland for reconsideration.

TESI and Maryland timely appealed to this court, urging reversal on the merits. The Director has also filed in this court urging reversal, but on jurisdictional grounds. 2

We have jurisdiction over petitions for review of final orders of the Board pursuant to 33 U.S.C. § 921(c).

II. STANDARD OF REVIEW

“The Supreme Court has instructed us that the preferred starting point in reviewing an administrative order is to satisfy ourselves that the agency whose order we are asked to review ‘had jurisdiction over the matter in dispute.’ ” Harmar Coal Co. v. Dir., Office of Workers’ Comp. Programs, U.S. Dep’t of Labor, 926 F.2d 302, 307 (3d Cir.1991) (quoting Cardillo v. Liberty Mut. Ins. Co., 330 U.S. 469, 473, 67 S.Ct. 801, 91 L.Ed. 1028 (1947)). “Jurisdiction is a question of law which we review de novo.” Groome Res. Ltd., L.L.C. v. Parish of Jefferson, 234 F.3d 192, 198 (5th Cir.2000).

“This court reviews the [Board’s] interpretation of the LHWCA, an issue of law, de novo, affording no special deference to the [Board’s] construction because it is not a policymaking agency.” Equitable Equip. Co. v. Dir., Office of Worker’s Comp. Programs, U.S. Dep’t of Labor, 191 F.3d 630, 631 (5th Cir.1999); see also Estate of Cowart v. Nicklos Drilling Co., 505 U.S. 469, 476, 112 S.Ct. 2589, 120 L.Ed.2d 379 (1992) (stating that “the [Board] is not entitled to any special deference”); H.B. Zachry Co. v. Quinones, 206 F.3d 474, 478 (5th Cir.2000) (“Indeed, deference is owed to the Director’s views and not the views of the [Board].”); Ceres Gulf & ESIS/INA v. Cooper, 957 F.2d 1199, 1204 (5th Cir.1992) (stating that “[s]ubject matter jurisdiction is a question of law[, and] our review is plenary”).

III. JURISDICTION

Due to the maritime character of their employment, longshore workers 3 were precluded from participating in state workers’ compensation schemes. See S.Rep. No. 973, at 16 (1926); 1 Thomas J. Schoenbaum, AdmiRalty and MaRitime Law § 7-1, at 380 (3d ed.2001). Therefore, in order to protect longshore workers, Con *459 gress enacted a federal no-fault workers’ compensation system — the LHWCA. See 33 U.S.C. § 904

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Temporary Employment Services v. Trinity Marine Group, Inc., 261 F.3d 456, 2001 WL 883543 (5th Cir. 2001).

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