Simmons v. Sea-Land Services, Inc.
Opinion of the Court
These consolidated appeals involve common issues of law regarding a longshoreman’s right to sue third parties pursuant to the Longshoremen’s and Harbor Workers’ Compensation Act, 33 U.S.C. §§ 901 et seq. For the reasons expressed herein, we affirm the decision of the district court.
Each of these cases involves a longshoreman who was injured on the job and who accepted compensation benefits without contravention by their employers. Each longshoreman later brought an action against an allegedly negligent shipowner pursuant to 33 U-S.C. § 905(b). In each case the district court concluded that the plaintiff had received “an award in a compensation order” more than six months pri- or to the institution of his action, and that pursuant to 33 U.S.C. § 933(b) the plaintiff no longer retained the right to sue the shipowner.
Two principal issues emerge from these rulings. First, we must identify the event or events which create “an award in a compensation order” sufficient to trigger the six-month period set forth in Section 933(b). Second, we must determine whether an assignee who has acquired the claim upon expiration of the six-month period may reassign that claim to the injured longshoreman.
I.
33 U.S.C. §§ 933(a) and (b) provide:
(a) If on account of a disability or death for which compensation is payable under this chapter the person entitled to such compensation determines that some person other than the employer or a person or persons in his employ is liable in damages, he need not elect whether to receive such compensation or to recover damages against such third person.
(b) Acceptance of such compensation under an award in a compensation order filed by the deputy commissioner or [the Benefits Review] Board shall operate as an assignment to the employer of all right of the person entitled to compensation to recover damages against such third person unless such person shall commence an action against such third person within six months after such award.
Under these subsections, a longshoreman who accepts “compensation under an award in a compensation order” has six months to bring an action against the third party, and the failure to do so operates as an assignment of the claim to the employer or its subrogee. 33 U.S.C. § 933(h). Thus, the critical phrase for purposes of the assignment is “an award in a compensation order.”
Having determined that Section 933(b) contemplates an informal award, we next turn to the requisites of such an award. As revealed by the facts of these cases, a number of events may occur during the disability period which could be interpreted as the culmination of an informal award.
With these concepts in mind, we hold that “an award in a compensation order” is created by the completion of three events: (1) the employer, having not contravened its liability, initiates compensation payments to the longshoreman; (2) the deputy commissioner files the employer’s notice that compensation payments have been initiated; and (3) the longshoreman accepts any of the payments.
II.
The LHWCA contains no provision for the actual, voluntary reassignment of a claim once the six-month period expires and the claim has vested in the assignee. In Caldwell v. Ogden Sea Transp., Inc., 618 F.2d 1037 (4th Cir. 1980), we ruled that such assignments were proper. However, certain aspects of Caldwell were subsequently criticized and rejected by the Supreme Court in Rodriguez v. Compass Shipping Co., Ltd., 451 U.S. 596, 101 S.Ct. 1945, 68 L.Ed.2d 472 (1981). Accordingly, our analy
Caldwell sanctioned both voluntary and involuntary reassignments subsequent to the expiration of the six-month period. A voluntary or actual reassignment simply required the statutory assignee to reassign the claim to the injured longshoreman. To obtain an involuntary reassignment, the longshoreman could compel the assignee to either sue the third party or reassign the claim. In support of these rulings, we relied upon Congress’ intent that third parties be held to liability and the absence of conflict with the LHWCA.
The Caldwell rationale was sharply criticized in Rodriguez. After reviewing the LHWCA, its amendments and the problems which arose in its administration, the Supreme Court concluded that “once the 6-month period expires, the employer possesses complete control of third party claims.” 101 S.Ct. at 1954. With this principle as its touchstone, the Court rejected the Caldwell rule that a longshoreman could compel the assignee to either sue or assign the action.
Although Rodriguez limited its discussion to the longshoreman’s residual or concurrent rights in the post-assignment period, the Court strenuously emphasized “[t]he comprehensive character of the procedures outlined in the Act....” 101 S.Ct. at 1956. In light of the admonition to refrain from “fashioning ... an entirely new set of remedies,” id., we are constrained to rule that the purported assignments were invalid as a matter of law because they fall outside the purview of the LHWCA.
Accordingly, the judgment entered by the district court in each of these cases is affirmed.
AFFIRMED.
. The district court reached this conclusion in an earlier opinion concerning one of the appellants, Bandy v. Bank Line, Ltd., 442 F.Supp. 882 (E.D.Va. 1977). That decision was affirmed on appeal as to the claims of appellants Bandy, Caldwell, Harold and Curry. Caldwell v. Ogden Sea Transp., Inc., 618 F.2d 1037 (4th Cir. 1980). In its opinions in the current cases, the district court relied upon our affirmance of its earlier decision.
. As a preliminary argument, the appellants urge us to limit Ameta to its facts. This argument is foreclosed by Caldwell.
. All appellants filed their actions more than six months after compensation payments were initiated; however, the pattern of payments varies from case to case. Bandy, Caldwell, Curry and Harold filed their actions more than six months after receiving their last compensation payment; none of these claimants ever received a formal award. Simmons filed his action while receiving payments, but the payments had once been interrupted when he at-' tempted to return to work; he also did not receive a formal award. Hart received payments from July 27, 1978 until September 3, 1979, and then received a lump sum payment in a formal order dated October 26, 1979; he filed his action more than six months later in July, 1980. McLean filed his action while receiving payments, but subsequent to the filing date received a formal award of permanent total disability. Spratley filed his action while receiving payments and within six months of a formal order of permanent total disability.
. In accord with our decision is Larson v. Associated Container Transp. (Australia) Ltd., 459 F.Supp. 561 (E.D.Va. 1978).
Reference
- Full Case Name
- Pearlie SIMMONS v. SEA-LAND SERVICES, INC., Appellee Michael D. HART, individually and for the use and benefit of Liberty Mutual Insurance Company v. D.B. Denis NAKLIYATI T.A.S., Appellee Melvin BANDY, for and on behalf of himself, individually, and American Mutual Insurance Company of Boston v. BANK LINE, LTD., Appellee Fred L. SPRATLEY, for and on behalf of himself, individually, and Atlantic & Gulf Stevedores, Inc. v. HELLENTIC LINES, LTD., Appellee Thomas E. McLEAN, and Atlantic & Gulf Stevedores, Inc. v. CIA TRANSATLANTIC ESPANOLA, S.A., Appellee Charles A. CALDWELL, and Commercial Union Insurance Co. v. OGDEN SEA TRANSPORT, INC., Appellee Wallace CURRY, and Atlantic & Gulf Stevedores, Inc. v. COMPANIA CRASATLANTICA ESPANOLA, S.A., Appellee Wilbert C. HAROLD, for and on behalf of himself, individually, and The Hartford Accident Indemnity Insurance Company v. COMPANHIA DE NAVEGACAO MARITIMA NETUMAR
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