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GROVES v. UNIVERSE TANKSHIPS

January 20, 1970

Melba V. GROVES, Administratrix of the Estate of Robert Groves, Deceased, Plaintiff,
v.
UNIVERSE TANKSHIPS, INC., Defendant


Frederick Van Pelt Bryan, District Judge.


The opinion of the court was delivered by: BRYAN

FREDERICK VAN PELT BRYAN, District Judge.

Defendant Universe Tankships, Inc. (Universe) moves pursuant to 12(b) F. R. Civ. P. to dismiss the complaint for failure to state a claim upon which relief can be granted. Since the papers submitted on the motion present facts which are not alleged in the complaint, the motion will be treated as one for summary judgment under Rule 56.

 Plaintiff is the administratrix of a deceased seaman who met his death, aboard the S.S. Ore Saturn owned by Universe, on November 5, 1962. The complaint alleges that death was caused by the negligence of Universe and the unseaworthiness of the vessel. Liability is asserted under the Jones Act, 46 U.S.C. § 688, and general maritime law.

 The only question presented by the motion is the recurrent and troublesome one of the extent to which the Jones Act applies to foreign seamen injured or killed aboard foreign flag vessels. *fn1"

 For all practical purposes the facts are undisputed. The Ore Saturn was a vessel of Liberian registry, flying the Liberian flag. Defendant Universe, her owner, is a Liberian corporation. Universe is wholly owned by Oceanic Tankships, Inc. (Oceanic), a Panamanian corporation, the stock of which is owned almost entirely by D.K. Ludwig, with the remaining shares held by W.W. Wagner. Both Ludwig and Wagner are American citizens and residents.

 Ludwig also owns substantially all of the stock of and controls National Bulk Carriers, Inc. (National Bulk), a diversified shipping corporation organized under the laws of Delaware and having its principal offices and business and operating headquarters in New York City. Ludwig is president and a director of National Bulk. While National Bulk owns only a small number of ships directly, it has some 130 affiliated companies through which it conducts its operations. Universe is one of these affiliates and occupies the same office in New York as National Bulk. The principal officers of National Bulk and Universe are the same and are American citizens and residents. The business and shipping operations of Universe are directed by Ludwig through National Bulk from the joint New York offices. All claims by or against Universe are handled by the Claim Department of National Bulk.

 Universe has only a nominal office in Liberia. It has no employees and conducts no business there. Its only other office is that with National Bulk in New York. Oceanic, the immediate parent of Universe, similarly has only nominal offices in Panama, the country of its incorporation. It has no employees and conducts no business in that country. Its only other office is also with National Bulk in New York.

 The Ore Saturn was a bulk ore carrier. Her master was an American citizen and resident. She had a crew of mixed nationalities, including Canadians, Greeks, Danes, Germans, British West Indians, Okinawians and an American. There were no Liberian crew members. The vessel has never visited a Liberian port. During the period from 1961 through 1963 she regularly called at the Port of Philadelphia approximately once a month discharging a cargo of some 40,000 tons of iron ore and has since called at that port frequently.

 Decedent was a British subject and a resident of Grand Cayman, British West Indies, as is plaintiff administratrix. Neither the decedent nor his administratrix have ever resided in the United States. Decedent joined the Ore Saturn on November 16, 1961 by signing Liberian Articles in Port of Spain, Trinidad. The Articles described the vessel as bound for the Port of Philadelphia. They provided that claims for injury and death should be governed by the laws of Liberia and that each crew member was required to join the Global Seamen's Union. Apparently, the Ore Saturn never unloaded or discharged cargo in Port of Spain.

 As the Supreme Court pointed out in Lauritzen v. Larsen, 345 U.S. 571, 73 S. Ct. 921, 97 L. Ed. 1254 (1953), in determining whether the Jones Act applies to a foreign seaman injured aboard a foreign flag vessel, "we are simply dealing with a problem of statutory construction." (Id. at 578, 73 S. Ct. at 926) The Court indicated that the problem could be resolved "by ascertaining and valuing points of contact between the transaction and the states or governments whose competing laws are involved" and "from weighing * * * the significance of one or more connecting factors between the shipping transaction regulated and the national interest served by the assertion of authority." Id. at 582, 73 S. Ct. at 928. The Court listed seven factors to be considered: (1) the place of the wrongful act; (2) the law of the flag; (3) the allegiance or domicile of the injured; (4) the allegiance of the defendant shipowner; (5) the place of the contract; (6) the accessibility of a foreign forum; and (7) the law of the forum.

 The facts in Lauritzen were as follows: Plaintiff, a Danish seaman, had joined the crew of a ship of Danish flag and registry, owned by a Danish citizen, while he was temporarily in New York. He had signed Ship's Articles written in Danish and providing that his rights as a crew member would be governed by Danish law and by the owner's contract with the Danish Seamen's Union of which he was a member. Plaintiff had been negligently injured in the course of his employment aboard the vessel while she was in harbor at Havana, Cuba. He brought suit under the Jones Act in the Southern District of New York.

 After considering the seven relevant factors in so far as they applied to the facts before it, the Court readily concluded there was no justification for construing the Jones Act so as to apply to the plaintiff.

 In discussing the relevant factors, the Court said: "Perhaps the most venerable and universal rule of maritime law relevant to our problem is that which gives cardinal importance to the law of the flag." Id. at 584, 73 S. Ct. at 929. "The law of the flag prevails unless some heavy counterweight appears." *fn2" Id. at 586, 73 S. Ct. at 930.

 The place of the wrongful act was considered to be of little significance "because of the varieties of legal authority over waters [ships] may navigate." Id. at 583, 73 S. Ct. at 929. The place of contract, generally fortuitous, was not of "substantial influence in the choice between ...


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