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May 31, 1961

Frank DRAGO, Plaintiff
A/S INGER, Defendant. A/S INGER, Third-Party Plaintiff, v. DANIELS & KENNEDY, INC., and Illinois Atlantic Corp., Third-Party Defendants

The opinion of the court was delivered by: ZAVATT

The plaintiff, Frank Drago, is a longshoreman employed by the third-party defendant, Daniels & Kennedy, Inc., a stevedoring company. On January 4, 1956 he was aboard the S. S. Elin Hope (owned by the defendant and third-party plaintiff A/S Inger) which was tied up to a pier at the foot of Dikeman Street, Brooklyn, New York. He was working aboard this vessel as a winchman and, in that capacity, had been operating the starboard steam winch at hatch No. 2. Immediately before the plaintiff left the vessel to go to lunch, he turned off the winch steam. Upon his return from lunch he started up the steam again and thereafter left it unattended and walked over to hatch No. 1 where he was directed by his hatch boss, another employee of the stevedoring company, to cut off the winch until 'the Number 1 hatch caught up.' In the process of cutting off the steam to this winch his foot was crushed by the moving piston. On the trial to the court and a jury the plaintiff and his witnesses testified that there was grease and oil on the deck in the vicinity of this winch; that it had spilled on the deck when an employee of the vessel greased the winch and applied oil to its moving parts at various times that morning and that oil had also spurted on the deck from the winch while it was operating. The plaintiff claimed that he slipped on this grease and oil as he was approaching the winch for the purpose of cutting off the steam and that, when he slipped, his foot came to rest in the area over which the piston moved; his body struck the operating lever of the winch, thereby activating the piston which crushed his foot. He claimed further, that a safety device, a pin, designed to keep the lever in neutral, was missing from the winch; that he had placed a piece of wood under the lever to hold it in neutral position while he left the winch to walk over to No. 1 hatch and, that as his body struck the lever the piece of wood was dislodged, the lever went down and thereby activated the piston. He sought to recover against the defendant on the theories of unseaworthiness and negligence. The defendant, owner of the vessel, impleaded the stevedoring company, Daniels & Kennedy, and the time charterer, Illinois Atlantic Corp. Only the claims of the plaintiff against the defendant were tried to the court and jury, the parties having stipulated that the claim over against the impleaded defendants would await the outcome of the jury's verdict and any issues that remained would be determined by the court. The court submitted to the jury, pursuant to Rule 49(b) of the Rules of Civil Procedure, 28 U.S.C.A., written interrogatories which were answered by the jury as follows:

'1. Do you find for the plaintiff on the ground that the ship was unseaworthy? No.

'2. Do you find for the plaintiff on the ground that the defendant was negligent? Yes.

 '3. Did you reduce the plaintiff's damages because of his contributory negligence? Yes.

 'If so, by what percentage? 75%.' The jury returned a verdict for the plaintiff against the defendant in the sum of $ 4,500. Thereafter, the third-party claim of Inger against Daniels & Kennedy and Illinois Atlantic was tried to the court without a jury.

 The vessel had completed a voyage from Canada where it had taken on large quantities of paper purchased by The News Syndicate, Inc., (not a party to this action). The News engaged Daniels & Kennedy to unload the cargo in keeping with their blanket stevedoring agreement dated April 3, 1952. The time charter between Inger and Illinois Atlantic, dated January 30, 1950, was in full force and effect on the date of the accident. It is in the form of a New York Produce Exchange Government Time Charter and provides, inter alia: 'Charterers are to load, stow, and trim the cargo at their expense under the supervision of the Captain.' At the trial, Illinois Atlantic conceded that this provision contemplated not only loading but also discharging cargo, so that under that agreement Illinois Atlantic had the obligation to unload. Nevertheless, Illinois Atlantic did not discharge the cargo itself nor did it directly engage anyone to do so in its behalf. Rather, The News as consignee engaged Daniels & Kennedy to discharge the cargo.

 The paper which was transported from Canada to Brooklyn aboard the vessel, under a bill of lading signed by the master, had been purchased by The News from Quebec North Shore Paper Co. North Shore had entered into a 'contract of affreightment' with Illinois Atlantic, the time charterer, dated January 5, 1950 and in full force and effect on the date of the accident. Under that agreement the shipper, North Shore, was required to load and stow the cargo aboard the vessel in Canada. The agreement contemplated that the consignee, The News, although not a party to that agreement, would discharge the cargo at its own expense. Presumably, under the purchase and sale agreement between North Shore and The News, the seller's obligations so far as delivery was concerned ended when the cargo was loaded aboard the vessel thus casting on the purchaser, The News, the burden of unloading its own cargo.

 The Jury's Verdict

 The jury's verdict, though supplemented by its answers to the interrogatories, is somewhat ambiguous. For example, the exact manner in which the shipowner and the longshoreman were negligent is not specified. While these specifications are not necessary for the verdict in the suit by the longshoreman against the shipowner, they may be material to the shipowner's claim for indemnity asserted against both the time charterer and the stevedore. See Weyerhaeuser S.S. Co. v. Nacirema Operating Co., 1958, 355 U.S. 563, 78 S. Ct. 438, 2 L. Ed. 2d 491. Therefore, in order to resolve the third-party aspects being tried to the court alone, the court must make additional findings of fact which must not be inconsistent with the findings expressed in the jury's answers to the interrogatories or necessarily implied in the jury's verdict in the primary suit. See Weyerhaeuser S.S. Co. v. Nacirema Operating Co., supra.

 The plaintiff's legal theories of negligence and unseaworthiness were premised on common factual allegations: that the deck was covered with grease and oil and that the safety pin for the operating handle of the winch was missing. While the jury's verdict is ambiguous, it seems clear to me in light of their finding that the plaintiff was contributorily negligent to the degree of seventy-five per cent, that the jury rejected plaintiff's evidence and argument that there was grease and oil on the deck; that he slipped thereon; that his foot came to rest as he claimed; that he fell over the lever as he claimed. Rather, the answers to the interrogatories and the general verdict returned indicate that the jury accepted the defendant's theory of the accident, i.e. that when the plaintiff was told to close off his steam he stood up on the piston rod and leaned over the operating handle in order to reach the steam valve on the opposite side of the winch; that proper procedure and due care called for the plaintiff to walk around his winch, in order to reach the shut-off valve; that in leaning over the winch plaintiff lost his balance, slipped, depressed the operating handle with his body as he fell, and thereby activated the piston which crushed his toes because he had placed his foot on the piston rod in the first place. Implicit in the jury's finding of negligence on the part of the shipowner is a finding that the shipowner did not provide a safety pin which, if provided and used, would have avoided the accident.

 I am convinced that this is what the jury determined. In any event, such findings are not inconsistent with their answers and their verdict. As I must make additional findings, those are the findings that I make. One further refinement may be necessary: did the shipowner, through its employees, know that the safety pin was missing, or was the shipowner negligent in that it should have known? The plaintiff testified that he told no one about the missing pin. Some further evidence on this point was provided by the second mate, Sverre Johnsen, who testified that at all times the pin was hanging from a metal chain on the winch. The jury evidently disbelieved Johnsen, but it is a big jump from disbelief of the presence of the pin to a finding that Johnsen, and therefore the shipowner, affirmatively knew that the pin was missing and chose to do nothing about it. I find that the pin was missing; that it is more reasonable that Johnsen did not know of the missing pin and that the shipowner's negligence lay in not correcting a dangerous condition that it reasonably should have discovered.

 Legal Theories of the Parties

 The shipowner has sued over against the time charterer and the stevedore. The shipowner's theory against the charterer is that under the charter party the charterer assumed the obligation to unload the vessel and that implied in that undertaking is the promise that the unloading would be done safely and that for the breach of that promise the charterer would idemnify the shipowner for any losses suffered by the latter.

 The shipowner's theory against the stevedore is that the stevedore warranted that it would accomplish its expert, professional services in a workmanlike manner and indemnify for any loss occasioned by the breach of that warranty. This warranty is implied in the following covenant:

 'The Contractor will provide all necessary labor and services to discharge * * * paper from ships * * * in a prompt and efficient manner.'

 Although the stevedore was hired by the consignee of the cargo rather than by the shipowner and, therefore, there was not the contractual privity between shipowner and stevedore that there is between shipowner and charterer, the shipowner argues that it is the third-party beneficiary of that warranty and its attendant indemnity provision.

 The third-party defendants, the charterer and the stevedore, have of course cross-claimed against each other seeking indemnity should the shipowner be successful in its suit. The charterer's basis for recovery is an indemnity provision in the stevedoring agreement entered into between the consignee of the cargo and the stevedore. By the terms of that agreement, the stevedore promised to indemnify the consignee and its 'subsidiary and affiliated companies.' The charterer asserts that it is such a company.

 For its part the stevedore makes general allegations that, if it is required to indemnify the shipowner, it will be because of the primary negligence of the charterer and therefore under the common law theory of primary-secondary wrongdoing it would be entitled to be indemnified by the charterer.

 Having set forth the claims and contentions of the parties, it is possible to simplify their analysis. It will be seen that the shipowner's basic grievance is with the stevedore as the party actively engaged in unloading the vessel. Under the shipowner's theory the liability of the charterer is derivative in the sense that the charterer's liability depends on a finding that the independent contractor, engaged to discharge the obligation of the charterer under the charter party, did not do its job in conformity with its undertaking. It seems preferable ...

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