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BRKARIC v. STAR IRON & STEEL CO.

February 2, 1976

CLAUDIA BRKARIC, Administratrix of the Estate of MARIO BRKARIC, Deceased, and as mother and natural guardian of RONALD BRKARIC and MARIO PAUL BRKARIC, infants, and CLAUDIA BRKARIC, Individually, Plaintiff,
v.
STAR IRON & STEEL COMPANY, HANNA FLUID POWER DIVISION, REX CHAINBELT, INC., a/k/a REXNORD, DIAMOND MANUFACTURING CO. INC., CUTLER HAMMER, INC., FLUID AIR COMPONENTS INC., PORT TESTING CO., INC., and J. I. HASS CO. INC., Defendants. STAR IRON & STEEL COMPANY, Third-Party Plaintiff, v. HANNA FLUID POWER DIVISION, REX CHAINBELT, INC., a/k/a REXNORD, DIAMOND MANUFACTURING CO. INC., CUTLER HAMMER, INC., FLUID AIR COMPONENTS, INC., PORT TESTING CO. INC., and J. I. HASS CO. INC., Third-Party Defendants. CUTLER HAMMER, INC., Defendant and Third-Party Plaintiff, v. NORTHEAST MARINE TERMINAL CO. INC., and THE CITY OF NEW YORK, Third-Party Defendants


Judd, J.


The opinion of the court was delivered by: JUDD

MEMORANDUM AND ORDER

JUDD, J.

 Third-party defendant Northeast Marine Terminal Company, Inc. (Northeast), has moved to dismiss the third-party complaint of defendant and third-party plaintiff Cutler Hammer, Inc. (Cutler), and the cross-claims of certain defendants who claim indemnity or apportionment of liability in the event that plaintiff is successful in her wrongful death action.

 The third-party claims find support in state law, and to some extent in maritime law, as well as under the " Murray credit" doctrine originally developed in the District of Columbia.

 Facts

 On December 20, 1973, plaintiff's decedent, Mario Brkaric (Brkaric), who was employed by Northeast as a container crane mechanic, was working on a gantry crane located at or near the 39th Street Pier, Brooklyn, when the trolley cab lurched from its rails, throwing Brkaric from the catwalk of the cab into the navigable water 80 feet or more below. Death was caused by asphyxiation from submersion (drowning). At the time of the accident, Brkaric was checking or testing the crane, which was being operated by another Northeast employee.

 Plaintiff brought an action for wrongful death and pain and suffering, alleging negligence, breach of warranty, and strict tort liability against Star Iron & Steel Company (Star), the designer, manufacturer and assembler of the crane. Star then filed a third-party complaint against Hanna Fluid Power Division, Rex Chainbelt, Inc., a/k/a Rexnord (Hanna), the manufacturer of shock absorbers or hydraulic bumpers, allegedly used in the crane; Fluid Air Components Inc. (Fluid), a distributor of Hanna, who sold the shock absorbers to Star; Diamond Manufacturing Co., Inc. (Diamond), manufacturer and assembler of certain structural steel components; Cutler, the designer, builder and installer of the electrical components and equipment used in the operation of the crane; Port Testing Co., Inc., the supplier of labor for the erection of the crane; and J. I. Hass Co., Inc. (Hass), the painter of certain portions of the crane.

 Plaintiff thereafter filed an amended complaint, adding as defendants the same six corporations named in the third-party action; and Cutler brought another third-party action against Northeast and the City of New York (City), which owned the crane and leased it to Northeast. In addition to being decedent's employer, Northeast allegedly operated and maintained the crane as well as the premises at 33rd Street and Marginal Street where Star was to furnish and erect the crane.

 Diversity jurisdiction under 28 U.S.C. § 1332 was claimed in the original complaint. Plaintiff is and decedent was a citizen of New York, while none of the defendants is a New York corporation and none has a principal place of business in this state. The jurisdictional amount is exceeded. Admiralty jurisdiction is also claimed in the amended complaint, under 28 U.S.C. § 1333. The main action seeks damages under state law and also under general maritime and admiralty law, asserting that the crane was for use in loading and unloading ships and cargo on navigable waters.

 No shipowner is named as a defendant in either the main or third-party actions, and the pleadings do not assert that Brkaric was engaged in any activity in connection with a vessel at the time of the accident.

 The amended third-party complaint of defendant Cutler claims indemnity or contribution from third-party defendants Northeast and City "in accordance with the principles of apportionment of liability." The negligence alleged against them consisted basically of failure: (1) to give proper warnings, instruction, and training concerning the use and maintenance of the crane; (2) to provide a safe place to work; and (3) to provide experienced co-workers. There is no claim that the right to indemnity or apportionment is based on any contractual relationship between Cutler and either third-party defendant.

 Hanna and the City have cross-claimed against Northeast and other defendants for indemnification based on negligence, claiming common law indemnity rights and apportionment under the Dole v. Dow principles described below.

 Plaintiff has been paid compensation under the Longshoremen's and Harbor Workers' Compensation Act, 33 U.S.C. § 901 et seq. (LHWCA) by Northeast's insurance carrier, State Insurance Fund, at the maximum compensation rate. She is currently receiving somewhat more than $10,000 per year ($210.53 per week) for herself and her children, or about half of his $21,500 salary. She also received death benefits and funeral expenses of over $15,000. The employer's first "Report of Accident" described Brkaric's occupation as longshoreman.

 The precise cause of the accident has not been determined, but one theory is that Hass, working under Northeast's supervision, painted the piston rods of the shock absorbers in a manner to prevent their sliding in the cylinder.

 All parties apparently assume that plaintiff has a cause of action against component manufacturers like Cutler and Hanna, if she can establish negligence or breach of an implied warranty. See Clark v. Bendix Corp., 42 A.D.2d 727, 345 N.Y.S.2d 662 (2d Dept. 1973), distinguishing Goldberg v. Kollsman Instrument Corp., 12 N.Y.2d 432, 240 N.Y.S.2d 592, 191 N.E.2d 81 (1963).

 Discussion

 1. Longshoremen's rights before and after 1972

 Under the terms of LHWCA, originally enacted in 1927, the liability of a longshoreman's employer was limited to compensation benefits. Section 5, 44 Stat. 1426, 33 U.S.C. § 905. Prior to 1972 the statute provided:

 
§ 905. Exclusiveness of liability
 
The liability of an employer prescribed in section 904 of this title shall be exclusive and in place of all other liability of such employer to the employee, his legal representative, husband or wife, parents, dependents, next of kin, and anyone otherwise entitled to recover damages from such employer at law or in admiralty on account of such injury or death, . . . .

 The injured stevedore was not strictly limited in his recovery to compensation benefits; actions were permitted against third parties. 33 U.S.C. § 933(a). In Seas Shipping Co. Inc. v. Sieracki, 328 U.S. 85, 66 S. Ct. 872, 90 L. Ed. 1099 (1946), the Supreme Court established absolute liability of vessel owners regardless of fault, if there were proof of unseaworthiness. In Halcyon Lines v. Haenn Ship Ceiling & Refitting Corp., 342 U.S. 282, 72 S. Ct. 277, 96 L. Ed. 318 (1952), the Supreme Court precluded the vessel owner from partial recovery by way of contribution even when the unseaworthiness was caused largely by negligence of the employer. Contribution has been allowed, however, from a party whom the plaintiff himself might sue and who is not entitled to the exclusive liability protection of LHWCA. Cooper Stevedoring Co., Inc. v. Kopke, Inc., 417 U.S. 106, 114, 94 S. Ct. 2174, 2178, 40 L. Ed. 2d 694 (1974).

 In Ryan Stevedoring Co. v. Pan-Atlantic S.S. Corp., 350 U.S. 124, 76 S. Ct. 232, 100 L. Ed. 133 (1956), the court offered the vessel owner some relief from the absolute liability for unseaworthiness by allowing indemnification from the stevedore employer under contract theories of express or implied warranties to perform the stevedoring contract in a workman-like fashion. The exclusive liability provision of Section 905 was thereby significantly eroded.

 The amendments enacted in 1972 abolished the Sieracki-Ryan absolute liability-contract indemnification relationship. The exclusive liability section remained, renumbered as Section 905(a). Section 18(a) of the 1972 amendments, 33 U.S.C. § 905(b), permits suits by a longshoreman against a vessel owner only on the basis of the vessel's own negligence, and prohibits agreements between the vessel owner and the stevedore for contribution or indemnification.

 In exchange for the ending of the Ryan -type indemnification, the stevedore employers agreed to a substantial increase in maximum compensation benefits, reflecting the increased wages being paid to longshoremen. 33 U.S.C. § 906(b); Legislative History, House Report No. 1441, 3 U.S. Code Cong. & Admin. News, p. 4700 (1972).

 In addition, the 1972 amendments to LHWCA redefined "employee" by expressly including "any longshoreman or other person engaged in longshoring operations," Section 2(a), 33 U.S.C. § 902(3), and extended the coverage to include injuries not only on navigable waters and dry-docks, but also on "any adjoining pier. . . ." 33 U.S.C. § 903(a). This change made obsolete the rule of Nacirema Operating Co. Inc. v. Johnson, 396 U.S. 212, 90 S. Ct. 347, 24 L. Ed. 2d 371 (1969) that a longshoreman must look to state law rather than LHWCA for injuries on a pier, not caused by a vessel. The power of Congress to change that rule had been mentioned in Victory Carriers, Inc. v. Law, 404 U.S. 202, 214-16, 92 S. Ct. 418, 426-27, 30 L. Ed. 2d 383 (1971).

 Mr. Justice Stewart has referred to the 1972 act as covering employees "working on those areas of the shore customarily used in loading, unloading, repairing, or building a vessel." See Executive Jet Aviation Inc. v. City of Cleveland, Ohio, 409 ...


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