Waterman Steamship Corporation v. Dugan & McNamara, Inc.

PETITIONER:Waterman Steamship Corporation
RESPONDENT:Dugan & McNamara, Inc.
LOCATION:Alabama General Assembly

DOCKET NO.: 35
DECIDED BY: Warren Court (1958-1962)
LOWER COURT: United States Court of Appeals for the Third Circuit

CITATION: 364 US 421 (1960)
ARGUED: Oct 20, 1960
DECIDED: Nov 21, 1960

Facts of the case

Question

Audio Transcription for Oral Argument – October 20, 1960 in Waterman Steamship Corporation v. Dugan & McNamara, Inc.

Earl Warren:

Number 35, Waterman Steamship Corporation, Petitioner, versus Dugan & McNamara.

Mr. Mount, you may proceed with your argument.

Thomas F. Mount:

Mr. Chief Justice and may it please the Court.

This case involves the question of indemnification or recoupment of losses by a steamship owner who has had to pay damages or who has sustained loss because of the personal injury to a longshoreman, who was an employee of an independent stevedoring company.

The facts in this case briefly are that the steamship had found real or it’s in the port of Philadelphia.

And while there, he was unloading a cargo of sugar in bags and the discharging work was being done by the respondent here which was an independent stevedoring contractor.

He was engaged or it was rather, by the consignee or owner of the cargo.

He was not employed by the vessel owner to discharge this cargo.

While the cargo was being discharged, one Jasper King, one of the longshoremen was injured.

Briefly, the reason for his injury is that this cargo bags was stowed from forward to aft in the whole of the vessel, from the forward bulkhead back to about the center of the hatch and from the bottom of the vessel up to the twin dike.

In other words, that left a vertical wall all the way across the ship of bags.

Partly in the hatch, forward part and the rest of the hatch, the lateral half of the hatch was opened.

This vertical wall was held in place by sufficient shoring and support so that it didn’t fall down.

When the stevedores started to work, they started in the portion of the stow which was at the top of the hatch and they started to take these bags of sugar out of the square of the hatch and they worked forward.

And as they did this, they broke down the stow, a distance of six feet or more in height.

So that the men, when they were working in, the cargo had walls of cargo around them of higher than they were.

And the testimony in the case, that as they were working forward in this hatch, one of the bags was not centrally placed down in the stow so that the weight of the bag on top was without support or some bags and they fell down.

That is alleged to be the unseaworthy condition existing.

The testimony is that this was not a safe and proper way to do this work, that they should not have broken it down to such a height.

They should’ve worked it out frigidly so that the men that are working in a whole which was higher than they were should have bags not so high above them.

And expert testimony was had and said that this was not safe and proper way of doing the work.

But anyhow —

Charles E. Whittaker:

(Inaudible)

Thomas F. Mount:

Yes, sir.

Charles E. Whittaker:

(Inaudible) unloading, who control that matter?

Thomas F. Mount:

The stevedore.

Charles E. Whittaker:

The stevedore.

Thomas F. Mount:

Yes, sir.

Well, anyway the fellow wasn’t hurt too awfully bad and he sued the ship contending unseaworthiness and unsafe place to work and the ship paid him off some $6800 and the suit had already been brought.

The ship joined in the stevedore claiming that if the ship is held liable by reason of any acts of the stevedore that it claimed indemnity over.

Thomas F. Mount:

And so, the case went to trial on the issue between the ship and the stevedore.

It being contended that the cargo being stowed in such a way that it was probably unsafe or unseaworthy and that the stevedores, in the manner in which they sought to unload this cargo, stowed as it was, were negligent and pursued an improper procedure, thereby, bringing into play the unseaworthiness for cargo which caused the accident.

At the end of the case, the trial judge directed a verdict in favor of the third-party defendant, the stevedore, on the ground that there couldn’t be any recovery or recoupment here on the — as a matter of law because there was no contractual privity between the stevedore and the owner of the vessel.

And that is the question which is now submitted to this Court for decision.

The Court of Appeals first heard the case on appeal from that judgment and affirmed it per curiam opinion, Judge — Chief Judge Biggs dissenting.

Then a reargument was had and then came the decision of this Court in Crumady and Fisser.

At that time, the reargument had been refused but on our petition, the Court permitted us out of time to ask for a rehearing in the light of Crumady and Fisser, which was had and notwithstanding Crumady and Fisser, the Court affirmed the decision.

And the argument which we had before the Court of Appeals on the last argument was what then the decision of this Court means in Crumady and Fisser, that’s all.

We had seven judges on the Court of Appeals.

Four of them says, it means one thing, the three say the other.

So, we’re in the position of where we’re asking your Court to give us a declaratory judgment as to what you meant in Crumady and Fisser.

John M. Harlan II:

That was the Court of Appeals by petition (Inaudible)

Thomas F. Mount:

I — I think the —

John M. Harlan II:

(Inaudible)

Thomas F. Mount:

Well, Judge Forman wasn’t on it the first time.

And he was on it at the last hearing.

He was in favor of the majority on — on the last opinion.

How the first —

(Inaudible)

Thomas F. Mount:

Well, Judge Biggs was the only dissent in the first go-round.

It was — the first opinion was filed in January of 1959 which was the per curiam opinion with Judge Biggs — Chief Judge Biggs dissenting.

And then Judge Hastie wrote the last opinion.

Charles E. Whittaker:

(Inaudible)

Thomas F. Mount:

No, sir, they — there was.

Charles E. Whittaker:

There was.

Thomas F. Mount:

There was but they withdrew it.

Charles E. Whittaker:

(Inaudible)

Thomas F. Mount:

Well, maybe I misunderstood.

They withdrew their — their next to the last opinion.

And the last opinion appears here in — in page —

Earl Warren:

32 of the record —

— 32 of the record —

Earl Warren:

— isn’t it?

But the opinion which they withdrew has been — was reported.

Report was withdrawn and the American Maritime cases in — in as much as they withdrew it, I haven’t belabored what they said it.

I didn’t think it was really worthwhile.

We are now concern with our last edition which is on page 32.

Now —

Earl Warren:

And to that opinion, Judge Biggs and Judge Goodrich were the dissenters.

Thomas F. Mount:

Three dissenters.

Earl Warren:

I beg your pardon.

Thomas F. Mount:

(Inaudible) also but he didn’t — he was not vocal in his dissent.

Judge Goodrich added a little help along the line.

Earl Warren:

Yes, I see.

Thomas F. Mount:

Now, the — the only question that we really have is this case any different from Crumady and Fisser on this one point.

Do you have to have contractual privity between the vessel owner and his contracting stevedore in order to — that the vessel owner may get indemnity against the stevedore if the stevedore does not perform his work in a safe and workmanlike manner?

Charles E. Whittaker:

(Inaudible) so do in the Crumady-Fisser case, as I recall, the Court held that the contract existing between the treasurer and the stevedore inured to the benefit of the shipowner.

Thomas F. Mount:

That’s right.

Charles E. Whittaker:

Now, then there was hence as — a privity in the sense there but in this case, you have stipulated, have you not, that no contractual relationship existed between this parties?

Thomas F. Mount:

That’s correct, sir.

And that’s the question.

Do we have to have it?

I thought there was something in the record that (Inaudible)

I thought there was something in the record to indicate that there is a contract between the stevedore and the consignee.

Thomas F. Mount:

Oh, there is.

On this a contract between —

(Voice Overlap) —

Thomas F. Mount:

— the stevedore and consignee and we say that under — under Crumady and Fisser, that we and the third-party beneficiary of that contract because it was — the part of that contract that the stevedore gained his employment, came aboard on the vessel, made his money, used our equipment and —

Charles E. Whittaker:

I wonder if that’s open to you having stipulated that there is no contractual relation between these parties.

Thomas F. Mount:

No, if the Court please.

Thomas F. Mount:

I’m not trying to get a third-party beneficiary out of a contract between me and the stevedore.

I’m saying that I, as the shipowner and the third-party beneficiary of a contract between the stevedore and the owner of the cargo who employed him.

Charles E. Whittaker:

And you regard that as still open under this stipulation.

Thomas F. Mount:

Yes, sir.

I don’t think the stipulation closes any door on that whatever.

Frankly, I must say to you that at the time when this case first started of in 1954, we were not very well informed as to what course these various Ryan case and — and Weyerhaeuser and Crumady and Fisser were going to take and we had always rather assume that any relationship for whereby the stevedore came aboard was tantamount to some sort of a contract.

But now, Your Honors, in the Crumady and Fisser case, as I read it, I have said now, it does make any difference.

Is — here’s what — you — the language which you have used which I have in mind, “We think this case is governed by the principle announced in the Ryan case.

The warranty which a stevedore owes when he goes aboard a vessel to perform services is plainly for the benefit of the vessel whether the vessel owners are parties to the contract or not.

That is enough to bring the vessel into the zone of modern law that recognizes rights in third-party beneficiaries.”

Restatement, Law of Contracts, Section 133.

Moreover, as we said in the Ryan case, “competency and safety of stowage are inescapable elements of the service undertaken.

They are part of the stevedore’s warranty of workmanlike service that is comparable to a manufacturer’s warranty of the soundness of its manufactured product.”

Now, that is, as I say, that indicates to me that Your Honors are — have recognized in this particular field of law the theory of third-party beneficiary.

And I think that is very sound and I think that’s the way it should be.

We must take in to account the realities of the situation.

For instance, ships are run particular cargo ships have businesses carrying cargo.

It’s just as important that the cargo be put in to the ship as it is that it’d be taken out.

Now, the ship is run on the various situations.

An owner is not always trading for his own account.

He may have his vessel out on a years time charter.

That time charter may have the — the option or the right under his charge to serve lent to somebody else for three months.

The second sub charterer, he may in turn choose to put it all on a forged charterer.

The — the steam shipowner has got a long way away from his ship by then but it’s still his ship and he is responsible for what goes on it.

So, therefore, it seems to be a tough proposition to put through a shipowner that he has got to make sure that he’s got a contract with every stevedore who works for a third charterer or somebody else, somewhere in the world in order that he can protect himself against what the stevedore does far had been making damages.

And that just doesn’t have any sense.

Therefore, it shouldn’t be that the shipowner has got to be in contractual privity.

But I thought we crossed that — those waters after in Ryan.

Thomas F. Mount:

I thought so, sir.

And I thought that this case made it doubly sure.

Thomas F. Mount:

But the Court of Appeals says no.

It says you’ve got to have a contract between the two parties.

There’s no contract here.

The ship and the receiver of the cargo are strangers, which is a specular thing to cite because it must be realized that the ship is a business of carrying cargo.

Somebody is going to put cargo in.

Somebody has got to put it in.

Somebody has got to take it out.

That’s just as important the thing as having a sound whole and every shipowner knows that somewhere along the line, somebody is going to take it out.

So there is no great magic in saying that you must have a contract between the stevedore and the shipowner where it has an interest in the cargo is going to see that he gets out.

The shipowner knows somebody is going to park a cargo — a stevedore and very quickly where you have a charter.

Each one (Inaudible) is given the right to nominate a stevedore even though in some instances, the ship pays the — the stevedore in charge.

And when the stevedore comes aboard to discharge cargo in the presence of the master and with his knowledge and consent, he has got a win for his services.

If who ever hires him don’t pay, so to say that the guy like that is a strange man is a very curious idea.

He certainly isn’t a trespasser.

And we all know that stevedore contractors don’t go walking along walls looking for a ship where he thinks he can slide aboard and salvage or — some cargo by way of doing stevedoring.

So I think the new point of that question is or the Court of Appeals is entirely unrealistic.

Now, in — in the committee in Fisser case, there was no contract between the shipowner and the stevedore if the contract was made between the stevedore and the charterers’ agent.

Now, there’s nothing to make the case that’s charter.

Charter was agent, was representing the ship when he made the contract for the stevedore.

Obviously he was representing the charterers.

But there, you said it made no difference so we take you at word on that.

As I say —

(Inaudible)

Thomas F. Mount:

Yes, and I can’t see no difference in this case.

The only — the only difference we have actually is that you got the contracts for — with the stevedore in the Fisser case between the charterers’ agent and the stevedore in this case it’s between the cargo owner and the stevedore.

So that whoever makes the — the deal, the stevedore is going to come on board, he’s going to do the same thing.

He’s going to do the same work.

He’s going to get the same pay.

He’s going to use our ship.

He’s going to have to get our cooperation, use our pertinencies and machinery and therefore, he — when he gets that job, he is coming aboard with our consent for his benefit and for ours.

Thomas F. Mount:

And I think in that situation, Judge Goodrich’s suggestion that that sets up for rather unilateral contractual relationship.

In other words, he can’t come aboard without our consent and when he gets the job, which he can perform on our vessel and he comes aboard if we say, “Alright, come aboard”, that in effect makes a contract that when he does come aboard, he warrants that he will do his work in the safe and workmanlike manner.

Now, I —

Unilateral — unilateral contractural is a very nice way, is it not?

Thomas F. Mount:

Yes, I didn’t hear it just that way before but I think its —

I think —

Thomas F. Mount:

— rather well court —

— I pose — that means that all for mate to the world without knowing who the world might be.

Thomas F. Mount:

That’s right and so it is with the third-party —

That’s merely all fictitious, isn’t it?

That’s merely a way of reaching a result if you have to reach it that way and when you want to reach it.

Thomas F. Mount:

No, sir.

I don’t, sir.

I think in the circumstances I think it’s very realistic as i have —

Well, I —

Thomas F. Mount:

— pointed out before.

— I think the circumstances are realistic but — but to talk about the unilateral contract, it — it requires some adaptation of the year, doesn’t it?

Thomas F. Mount:

Well, I don’t think so, sir.

As I say is a very — it’s a — it’s a relationship that comes into being that is highly advantageous to both parties, absolutely essential to the ship.

But the — the real reason is that the stevedore is held because he, really, is the party that has done the damage and the damage they have or shouldn’t be paid by the innocent person with the matter of law ultimately has to pay it —

Thomas F. Mount:

That’s right.

Is that the only reason?

Thomas F. Mount:

I think that’s the —

So why don’t we talk about this?

Thomas F. Mount:

That’s theory of the thing but you — you get at it on a basis of the fact that here, you got a ship which is what we might call very tender when it comes to beings — casted damages.

It’s got to be seaworthy.

Your Honors have said that’s suspicious of liability without fault.

So, therefore, when the stevedore comes aboard and he comes on board to his work, why then if he don’t — if he does something that makes us liable then he hasn’t carried out his agreement.

Now, I think that the third-party beneficiary in those circumstances is perfectly sound.

So I argued that you can’t have a third-party beneficiary if the third-party beneficiary don’t (Inaudible) but I say that isn’t true.

Thomas F. Mount:

You — they — they maybe contracts made between two parties that may have some effect on me two years from now.

I haven’t brought up by a theory that — that naturally, more familiar, sounds to me more rational than unilateral contract.

I will call it —

Thomas F. Mount:

I agree with you.

— I think the perfect — I think the perfect instance, if you think of it (Inaudible) contractual liability —

Thomas F. Mount:

Yes, sir.

— that it’s unjust between these two people that the stevedore ship get off when his — the fellow who really did it.

Thomas F. Mount:

I quite agree, sir.

I don’t think you have to go so far as to — as to use Judge Goodrich’s theory of unilateral contractual relationship.

I had to admire that phrase, Mr. Mount.

Thomas F. Mount:

That’s very — it sounds very good.

I — I meant admire.

I simply said that my ears get accustom to it.

Thomas F. Mount:

It hasn’t.

Earl Warren:

Mr. Mount, Justice Frankfurter’s question was on the basis that the negligence was all of the stevedores and that the shipowner is innocent.

Is that — is that record?

Thomas F. Mount:

I — no, no for that sir.

Earl Warren:

Beg your pardon.

Thomas F. Mount:

No — are you asking me a question about the record?

Earl Warren:

Yes.

Thomas F. Mount:

Oh, no.

I don’t think that is so.

I think that the record shows that there is testimony in the record.

Let’s put it to say that the cargo was stowed and so is to make a — unseaworthy condition.

Yes.

Thomas F. Mount:

And the — there is on the testimony in the record to the effect that the stevedore were — was performing his work, did it in such a — a challenge in such a matter that it was unsafe to do it in the way he did it so that he left his — all the cargo without protection, his good fault on his men.

And more particularly was he at fault because of the obvious unseaworthy condition of the stow So that in — this falls rightly within you’re right year in the Weyerhaeuser and the Crumady case that his negligence or you may call it negligence, it’s the failure to carry his untracked out and it brings into play, is the phrase which I think you use, the unseaworthy condition of the vessel.

Now —

Earl Warren:

Well, if there — if — if there is no contract between these two and they’re both guilty of negligence, wouldn’t — wouldn’t this just be enforcing the contribution from (Voice Overlap) —

Thomas F. Mount:

You — nothing but that fault situation because I say —

Earl Warren:

But how —

Thomas F. Mount:

— we do have a relationship between the banks.

And you got also the question of an existing condition of unseaworthiness here which the negligence or the failure to do or the failure to fall properly runs into play.

Now, if you’re going — as I say, the — the basis on which we get indemnity through the Ryan and Weyerhaeuser case and the Fisser case is based on the theory of a third-party beneficiary contract, none the contract between me and the stevedore.

Charles E. Whittaker:

Is that —

Earl Warren:

Well, I don’t think you quite get my point.

Thomas F. Mount:

Well, I’m afraid, sir, I did not.

Earl Warren:

— well, this — this is the — this is what I had in mind.

These other cases that we’ve had did envow the contractual relationship between the shipowner and the stevedore.

This one in this case, there is admittedly no contract between the two and according to your statement a moment ago, this is simply a case where — where both the shipowner and the stevedore were guilty of — of negligence, the shipowner in not having stowed the ship properly and the stevedore in not unloading the boat properly.

Now, are they not, I don’t say they are but the question comes into my mind, are they not just, in that situation, just joint tortfeasors and if they are, is there a contribution?

Should there be contribution between them?

Thomas F. Mount:

I say that they are not just joint tortfeasors.

You have answered that in the Ryan case very well and said through it, you may call it negligence but in fact, it’s a breach of contract.

Earl Warren:

But there was a contractual relationship —

Thomas F. Mount:

Not in this case, sir.

Earl Warren:

— between — between the stevedore, in Ryan, there was a contractual —

Thomas F. Mount:

In Ryan —

Earl Warren:

— between —

Thomas F. Mount:

but not in Fisser.

Earl Warren:

— the stevedore.

Thomas F. Mount:

Not in Fisser.

And you —

Earl Warren:

Now —

Thomas F. Mount:

— went —

Earl Warren:

— who is —

Thomas F. Mount:

— into the Fisser case much further than you’d gone in any other case.

Earl Warren:

Yes, I — I know that.

Let’s see, in Fisher who is the contract (Voice Overlap) —

Thomas F. Mount:

Contract was where an agent of the charterer, not the owner, agent of the charterer with the stevedore.

Earl Warren:

Yes, but the — the charterer has a contractual relationship to the owner.

Thomas F. Mount:

So he might have.

Earl Warren:

Yes —

Thomas F. Mount:

But still —

Earl Warren:

in this case —

Thomas F. Mount:

— it doesn’t make any contract between the owner —

Earl Warren:

Yes.

Thomas F. Mount:

— and the stevedore.

Earl Warren:

Well, I — I merely asked a question.

I —

Thomas F. Mount:

Yes, well, I think, Your Honor —

Earl Warren:

— I don’t have any — I don’t have any —

Thomas F. Mount:

— that — that thing has been —

Earl Warren:

— firm belief on it.

Thomas F. Mount:

— posed.

That same question you’re asking has been posed two or three times.

And I think Your Honors have answered it very clearly in — in the Ryan case and also in Weyerhaeuser.

That same question was said.

Well, they’re just — just joint tortfeasors, therefore, they —

The reason — the reason —

Thomas F. Mount:

— fall on Halcyon and Haenn case.

The reason they’re not being joint tortfeasors, I think it is because in one case, the unseaworthiness obligation with the shipowner is imposed by law.

Thomas F. Mount:

Just liability without fault.

Well, it’s imposed by law.

Thomas F. Mount:

Yes, sir.

Not through — yes, because he’s a shipowner.

Thomas F. Mount:

Right.

Because he’s a shipowner.

And the other thing is an assumed obligation to exercise certain care and the question is to whom does that obligation run if there’s a big fault in carrying it out?

Isn’t that the situation?

Thomas F. Mount:

I think so, sir.

I see my time is up.

Thank you, gentlemen.

Earl Warren:

Mr. Beechwood.

George E. Beechwood:

Mr Chief Justice, Mr. Justices.

May we start out on this case on the pleadings of the injured longshoreman who alleged that the ship improperly stowed the cargo and cause an unsafe place to work and cause the vessel to be unseaworthy.

Now, that in itself would not be particularly binding upon this petitioner.

This petitioner filed an answer to that complaint in 1956 back to the fact, one day after the decision of the District Court Judge in the Crumady case.

In which he, for the first time, brought out the theory of bringing into play, acting primary negligence as against the expressing instructions of the entire bench of this Court in the Weyerhaeuser case.

He seemed to follow that — the decision and the four core decision that there was a difference in the contractual relationship between the ship contractor, between active and passive negligence.

Not only did the Department Of Justice in arguing the Weyerhaeuser case before this Court that Mr. Justice Clark writing for this Court pointed out that judicial administration require that they should now, in the area of contractual relationship, realize and directed the lower court in the new trial, not to consider the difference between passive, active, primary and secondary.

Those were the exact words of the Court.

They’re not the exact words but those are the forewords used.

Those are the forewords used by the Department of Justice.

Charles E. Whittaker:

And that was directed, as I understand it, to dealings with contractual indemnity.

George E. Beechwood:

That’s right.

And we’ve had no case before this Court where indemnity has been allowed.

In this track and classic case where there was not a contractual relationship.

Now, let us start with the allegations of the petitioner himself.

After the District Court’s opinion, Crumady case, there was an amended complaint file using almost the exact words of the District Court Judge.

Namely, that the stevedore had brought into play the unseaworthy condition.

Nevertheless, you find this on page 5 of the brief, that the petitioner himself or itself had so placed a bag at the bottom of hearsay’s as has been called the vessel to be unseaworthy and caused the vessel in and off itself to be at fault.

Now then, would that fact is mind?

Let us look at the beginning of your cases, the Ryan Stevedoring case.

We will go back the Halcyon decision later because it deals with the question of this Court acting upon a positive statute of Congress that seems to forbid this action, notwithstanding a reference to the decision in the New York Court by the majority opinion in Crumady case.

In the Ryan Stevedoring case, Ryan was held responsible for the improper loading, improper stowage of the cargo at the port of origin.

Ryan was not held as he had a general contract for the discharging of the cargo on the far Atlantic coast or the discharge of that cargo in New York.

This Court bare said that it was not the responsibility of the ship to seek out cover and correct the improper stowage of the stevedore at the port of origin, that is namely Ryan.

That is the basis on which Ryan would — the case was decided.

I will say more about whether the bridging of (Inaudible) and I think it was crossed affirmatively that there had to be a contract in the Ryan case.

George E. Beechwood:

The Court went on to say that the ship did not have the correct that mistake.

In this case, the ship neither our consignee nor did our stevedore or the respondent in this case have anything to do directly, indirectly, legally or otherwise with the improper unseaworthy stow of this cargo.

And that is the allegation in the petitioner’s pleading as to why it paid King, the longshoreman because it was absolute liability because of it unseaworthy condition which it in fact brought about due to the fact that we could not discover, if you please, or look down below, if you please, or as the testimony might be and as I was rather embarrassed because the testimony of the speaking of proper procedure with man height and then there’s a question of how many inches had man height was so — but they did put it a little higher than I am tall.They put it I think in around six feet or five feet and a half.

But, in their own pleading, they alleged of an underlying cause of this — of the improper placing of that stowage at the foot of that tier which causes to collapse.

Now, the Circuit Court, beside from the question of the joint tortfeasor case part that it indicated great (Inaudible) and I believe as we did — Your Honor did in the Weyerhaeuser’s case where you said including conduct or conducts on behalf of the ship which was construed to be covered.

In many other cases in the brief which shows that where two wrong doers or party neither may recover from the other.

And I don’t know that the Halcyon decision has yet been overruled.

Now, we will start with the Halcyon decision to say that the Halcyon decision was concurred in by every member of this Court as it was now seating and only Justice Burton and Justice Reed thought that it should been divided I believe and that is the way the Halcyon case stood and then it’s stood today to be the law.

The Ryan Stevedoring case says, and Mr. Burton commented to the minority opinion concurred in by Mr. Justice — Mr. — the Chief Justice, written by Justice Black, concurred in by Justice Douglas, concurred in by Justice Clark, says that this was purely an indirect way of getting around the Longshoremen and Harbor Workers Act which says there shall not be a recovery against anyone and so that there will be no misunderstanding as to what that Act says.

I will just take one second that if no one should recover against anyone otherwise entitled to recover damages to such employer at law or (Inaudible) on account of the injury.

That statute has not been repealed.

That statute was in effect has been many amendments to this Act since this Court has spoken in 1952 and there is no reason to why this Court should now strike down that statute.

What did you say in the Ryan case?

The majority opinion for and for, Mr. Justice Frankfurter concurring, Justice Harlan will made the fourth member of the Court to make the majority of the Court.

This — this is a case based upon a contract.

This is a case not quasi-judicial contracture.

This is a case the same as a bond given as a suretyship and carried out and therefore, the exclusionary effect in the Longshoreman Act is not effective.

And in the Ryan case, insofar as this is was once clear, that the stevedore at the port of origin is the one who failed to put the chart under that rule paper.

He’s raised several thousand pounds, that he failed to do so that there was no question with respect to any responsibility of the ship other than the stevedore has failed to do what the stevedore in this case for which the ship is liable failed to do.

There seem to be clear in the Ryan case but that was based upon a breach of contractual warranty implied by law.

There was an expressed letter written by the Ryan Stevedoring Company to do all the stevedoring work in this — this concern throughout the entire Atlantic coast.

That was in the record and can be verified by the record.

Now, we go to the next case.

Earl Warren:

Mr. Beechwood, before you get away from that, would you mind stating for me just the difference in the degree of responsibility of the shipowner in this case and in the Ryan case.

As I recalled it, they were both imperfect stow, were they not?

George E. Beechwood:

That’s right.

Earl Warren:

Now, where — where — I — where in this difference in responsibility between the two shipowners?

George E. Beechwood:

In my opinion, there is no difference.

Earl Warren:

No.

I — I understood you saying it was.

George E. Beechwood:

No, my opinion is there is no difference.

Except in this case, the shipowner itself employed a stevedore down at the port of origin.

Earl Warren:

Yes.

George E. Beechwood:

In the Ryan case, the stevedore was both a stevedore at the port of loading and the port of discharge.

Earl Warren:

Go on.

Yes, yes.

George E. Beechwood:

So that in this case, this ship is just as responsible with that improper stow as was Ryan because the ship itself was the one who hired that stevedore.

They didn’t hire us.

They didn’t pay us.

We had nothing to do directly or indirectly.

No legal responsibility and there is no even suggestion, not been — tell us suggestion and of course, did not obviously been made because it would be totally inaccurate.

Now, in the Weyerhaeuser case again, you have an exact situation where the Nacirema Steamship — Nacirema Stevedoring Company was the first or the stevedore placed where the cargo was loaded and where it was discharged.

And we had a great deal of stow.

And there has been a great deal of basis written with respect to active and negative and negative and passive negative, nevertheless, this Court in Weyerhaeuser case, written by Mr. Justice Clark, and urged in the briefs by the Department of Justice that this was not a kind of a case where courteous, quasi contractual situations enter into at all.

It is not a case where active and passive or secondary or negligence can enter into at all.

It must arise from and be out of the contract.

This Court made it clear in both cases.

Both the Weyerhaeuser case and the Ryan case that the relationship between stevedores and the ship had nothing to do with the responsibilities to the injured seaman.

That was another thing entirely.

And that that relationship arose out of a contractual relationship and that arise out of any other kind of a relationship.

Now, I’ve heard a deal with respect to third-party beneficiaries under the Crumady case.

And of greatest respect to the majority court, I refer them to page 103 of the Crumady record, and I read it, which they recite terms, conditions of a contract, dowries, wages, name of the ship weren’t to be discharged.

And it ends up Insular Navigation Company owner, operator, charter and agent, then it was signed by the agent of every one of those form on behalf of every one of those.

There was no more necessity you have mentioned in third-party beneficiary at the Crumady case than there was to readapt your document because it has not been over less than a year ago that I have read the — the document and I didn’t even think there was a slightest doubt about it.

There wasn’t.

The ship by its agents was a party to that contract.

The contract so recites.

The contract gives the ship certain rights, name of the ship does everything in connection with it.

It specifies overtime.

It specifies rigging time.

George E. Beechwood:

It specifies everything the ship shall do.

Charles E. Whittaker:

Even if subject to that construction, Mr. Beechwood, do you read the opinion as proceeding on that too?

George E. Beechwood:

I proceed — I read the opinion as proceeding on an entirely erroneous theory.

Charles E. Whittaker:

One more question about this issue.Do you argue here that the Court did not find — the Court did find some negligence on the part of the ship in this stow as in Ryan?

George E. Beechwood:

You mean in the — in our present case?

Charles E. Whittaker:

Yes, this case.

George E. Beechwood:

Oh, yes, because the Court said twice in its opinion, once from Judge Maris’ proceeding and it was 7 — Section 1.

He said an admittedly improper as the stow was blocked, admittedly improper as the stow was.

In both of their opinion, they said that.

Charles E. Whittaker:

The trial court said on page 14 in sustaining the motion for the court to act further —

George E. Beechwood:

The trial court —

Charles E. Whittaker:

— that there was no negligence on the part of the ship and that was not the theory of his action.

He found here that the negligence, if there was any, goes on the part of the stevedore, didn’t he?

George E. Beechwood:

If it was a sole negligence of the stevedore and this was not a piece of equipment at all, nothing that we were doing or using for the ship, it was been a pure volunteer and they wouldn’t have failed.

That’s the reason they alleged, that’s the reason they stood on that basis and that’s the reason they’ve argued on that basis.

Charles E. Whittaker:

Well, wouldn’t they have had to pay under the theory of Hawn, Sieracki, two persons who enjoyed both shore-based employees, enjoyed the rights of seamen?

George E. Beechwood:

No.

I disagree with —

Charles E. Whittaker:

And wouldn’t the ship be liable simply —

George E. Beechwood:

— you entirely.

Charles E. Whittaker:

— because it was a ship?

George E. Beechwood:

I disagree with you entirely because the record says that if the ship — the stevedore is solely responsible.

And the ship does not bends on shoreman as a complete defense here.

So I don’t — I don’t follow that at all.

I mean I — I don’t think that’s it at all.

No.

Sieracki was on a defective piece of equipment.

And that was used by a longshoreman and Sieracki then put, after the (Inaudible) case way back in 1926, put the — a laborer at that time in the same category in giving him the right of a seaman.

Then Sieracki came along.

Now, it’s —

Potter Stewart:

Mr. Beechwood, before you proceed.

Is there a reference in your brief to this — this matter in the — in the Crumady record that you call our attention to the fact there was an owner’s contract in that case?

George E. Beechwood:

In the Crumady case?

Potter Stewart:

You told us that the actual record in the Crumady case.

I thought —

George E. Beechwood:

I did.

Potter Stewart:

— it showed that there was a —

George E. Beechwood:

I held in Crumady you have to — Crumady record right in my hands on page —

Potter Stewart:

Yes.

Well, do you have a —

George E. Beechwood:

— 97.

Potter Stewart:

Can you give us either the page in the record or is there a reference in your brief?

George E. Beechwood:

Page 97, the Crumady record.

Potter Stewart:

Alright, thank you.

George E. Beechwood:

Now, that’s the beginning of it.

Now, as the part that I read to you ends on page 103.

The Ryan Stevedoring case stands with a very principle of which I am arguing here that improper stowage, I don’t care whether by the ship or by the ship stevedore who he has employed, properly stowed that cargo and I don’t have to use my words.

All you got to do is to — to look in my brief and you’ll find the exact quotations out of their own pleading but that is what caused the unseaworthy absolute fault of it.

But that it wouldn’t have happened.

It would not have happened had we explored out and discovered and corrected just the opposite of the very thing that you said the mutual obligation of the ship had to do in the Ryan Stevedoring case.

The majority of the Court here said — am I out of time?

Earl Warren:

No, no, sir.

You have — you have seven, eight minutes before (Voice Overlap) —

George E. Beechwood:

Thank you.

It gets me a little nervous.

Earl Warren:

There’ll be a white light, five minutes before your time is up.

George E. Beechwood:

Thank you.

The Ryan Stevedoring case specifically points out that in this mutual obligation, when do they have it?

That the other must not and does not have to seek out and correct the negligence of the other.

That’s the principle of the Ryan Stevedoring case.And I respectfully submit, you cannot read it any other way.

George E. Beechwood:

And I respectfully refer you to Note 6, in the Ryan Stevedoring case where, and that’s the majority opinion, I’m going to refer to minority opinion in a few moments, written by Justice Black, where they pointed out that they do not reach the exclusionary effect of the Longshoreman’s Act and they cite Brown and Crawford decided by the Third Circuit that in order to — if they did that, they were circumventing and invading in doing by indirection that which the statute positively prevail.

Now, I think that that is probably more forcibly stated by Mr. Justice Black in the minority opinion in the Ryan case but as recently quoted, statement came out, the amount of the Oregon District Court while they followed the Crumady in the case, there are some observations there about the development of these — these five cases.

But it points out very clearly that — quoting Justice Black, concurred in by the Chief Justice, Justice Douglas and Justice Clark.

Liability is thus imposed because of the negligence of the employer’s other employee and this, the Act forbids.

Whether called common law indemnity, contribution, subrogation or any other names, the result is precisely the same.

Hugo L. Black:

I don’t believe I can get quote on that first.

I didn’t get it there.

I’m still thinking it’s right.

I’m afraid they — they ruled against it.

George E. Beechwood:

Well, they ruled against you but, Mr. Justice Black, since that time in the Crumady case to the Justice that is Justice Harlan and then Justice Frankfurter, in the Crumady case in the dissent, that’s what the Crumady case did not hold.

I mean the — the Ryan case did not hold, what is stated in the Crumady case and they cite both the Ryan case and the Weyerhaeuser’s case for that proposition.

And from that you — you do said that the two Justices you’ve mentioned is now agreeing with Justice Black’s dissent in Ryan, is that it?

George E. Beechwood:

I — I deduce that the majority opinion in the Ryan case held that there could be no recovery unless there was a contractual relationship and that recovery had to be based upon that contractual relationship, otherwise, it violated the exclusive provisions of the Longshoreman’s Act which says no recovery, just as what.

Now, there had been — I know there has been mentions of the New York statute.

They modeled after or our statute being modeled after the New York statute.

It so happens to be that I was with the United States Shipping Board starting in 1921, right — several years after World War I and remained at the Marine Insurance Profit from 1926 and we’ve studied this very statute.

And I may say that models may seem alike in all respects but they’re not always alike.

And that is true in this case.

I, therefore, go now to this question of a — in which this District Court has gone to extending in the MacPherson-Buick case.

I personally have no quarrel with the Crumady decision on its facts.

I have quarrel upon the reasoning of MacPherson and it’s pointed in this provision and everything else and the tort cases and if you follow MacPherson to its full extent, cross around tort.

That tort against to whom the crime or injury is committed would be the longshoreman.

The relationship is pointed out in the Ryan Stevedoring case, was not on tort but is on contract.

And if you follow the reasoning as suggested in the MacPherson case, you come to the point where the stevedore himself is under the warrant as a rank direct action under Longshoreman’s Act against the employer and I don’t believe the conscience of any judge could sustain that position.

And that is also pointed out that that is the full cycle of this metamorphous situation in which we have.

I want to say one more thing with respect to the question of our merchant marine and American Merchant Marines and the like.

We have foreign ships coming in here far more than ever indicated by the Government.

And you all are familiar with the (Inaudible) support which is put up by the Government, all available to you if you look at it very clearly.

And it’s referred to in the (Inaudible) citation in the brief.

But let me say this to you.

George E. Beechwood:

The economic situation of our American Merchant Marine and this is clear in those reports, as if everyone of our competitors are operating in as much less economical posture.

Yet, it is now being suggested that we can have inefficient stowage of the cargo.

We can have malfunctioning on machinery.

We can have everything in the world go wrong with that piece of machinery in that ship.

And when it’s brought to our American port, as an — as a foreign flagship with that competitor of ours, carrying our cargoes, doing everything else but we still have got to clear it out, observe and correct the very defects, the foreign countries are paying their men, 75% wages less than ours are to do that thing and then we’re asked to do it.

And if you’ll deduce me one more second, there are two kinds of an insurance in these matters.

One is protection in indemnity that has been all the time carried by the whole that is the ship.

That is for the protection of injured employees, seamen, damage appears and the like.

That’s an expense, and that’s an expense which are public is going to have to pay for.

In addition to that, if we have to be responsible to seek out and discover and correct the negligence of people, foreign ships who are ill-trained, ill-paid then we are asking to be paid a double premium to our public because our people also have got to take out insurance that protect themselves.

And I’m not going to say anything about the Halcyon case, and Justice Black in the Halcyon case, pointed so clearly and repudiated completely the argument that this Court to take upon itself the legislation with respect to joint tortfeasors in this type of case.

I see no reason for me to say anything about it except to say this that the brief had served upon the Government on September the 28th.

They were asked which department it was whether it was the Maritime Commission, whether it was the Secretary of Defense, whether it was the Secretary of Labor or whether it was the state departments or the executive department that favored this Court to legislate in a manner where the Congress has already legislated and just stopped short of the question and it’s so forcibly based by the majority of the Court in Justice Black’s decision in Halcyon case.

Therefore, I ask Your Honors to unanimously affirm the court below.

Thank you.

Earl Warren:

Gentlemen, it is so close to our German time but I think we will not start the — the next case this time.

We’ll recess now.