A longshoreman employed by respondent, stevedoring contractor
engaged by a consignee, sued a shipowner for personal injuries
sustained aboard a ship while helping to unload its cargo. The
shipowner settled the claim and sought to recover from respondent
on the ground that the longshoreman's injuries resulted from
respondent's failure to perform its work in a workmanlike
manner.
Held: Respondent was liable to the shipowner, even
though there was no privity of contract between respondent and the
shipowner and regardless of whether the longshoreman's original
claim was asserted in an
in rem or an
in personam
proceeding, since respondent's warranty of workmanlike service
aboard the ship was for the benefit of the ship and its owner as
well as of respondent's employer.
Crumady v. The J. H.
Fisser, 358 U. S. 423. Pp.
364 U. S.
421-425.
272 F.2d 823 reversed.
MR. JUSTICE STEWART delivered the opinion of the Court.
The petitioner is the owner of the vessel S.S.
Afoundria. The respondent is a stevedoring company. A
longshoreman employed by the respondent was injured aboard the
Page 364 U. S. 422
Afoundria while engaged with other employees of the
respondent in unloading the ship at the port of Philadelphia. The
cargo consisted of bagged sugar. The longshoreman was working in
the hold, and his injuries resulted from the collapse of a vertical
column of hundred-pound bags which the unloading operations had
left without lateral support.
He sued the petitioner in the District Court for the Eastern
District of Pennsylvania to recover for his injuries. The
petitioner settled the claim and, by way of a third-party
complaint, sought to recover from the respondent the amount paid in
satisfaction of the longshoreman's claim. The third-party complaint
alleged that improper stowage of the cargo [
Footnote 1] had created an unseaworthy condition in the
ship's hold which had imposed absolute liability upon the
petitioner as shipowner for the longshoreman's injuries, but that
"the direct, proximate, active and substantial cause of the
accident" had been the negligence of the respondent, who, by
"failing to perform the contracted stevedoring services in a safe,
proper, customary, careful and workmanlike manner," had brought the
existing unseaworthy condition into play.
As an affirmative defense, the respondent stevedore alleged that
there had been no direct contractual relationship between it and
the petitioner covering the stevedoring services rendered the
Afoundria in Philadelphia. At the trial, the parties
stipulated that this allegation was correct, it appearing that the
consignee of the cargo, not the petitioner, had actually engaged
the respondent to unload the ship. The District Court directed a
verdict for the respondent, holding that a shipowner had no right
of indemnity against a stevedore under the circumstances alleged in
the absence of a direct contractual relationship
Page 364 U. S. 423
between them. The Court of Appeals for the Third Circuit
affirmed in an en banc decision, three judges dissenting. [
Footnote 2] Certiorari was granted to
consider whether, in a situation such as this, the absence of a
contractual relationship between the parties is fatal to the
indemnity claim. 362 U.S. 926.
In
Ryan Stevedoring Co. v. Pan-Atlantic Corp.,
350 U. S. 124, it
was established that a stevedoring contractor who enters into a
service agreement with a shipowner is liable to indemnify the owner
for damages sustained as a result of the stevedore's breach of his
warranty to perform the obligations of the contract with reasonable
safety. This warranty of workmanlike service extends to the
handling of cargo, as in
Ryan, as well as to the use of
equipment incidental to cargo handling, as in
Weyerhaeuser S.S.
Co. v. Nacirema Co., 355 U. S. 563. The
warranty may be breached when the stevedore's negligence does no
more than call into play the vessel's unseaworthiness.
Crumady
v. The J. H. Fisser, 358 U. S. 423,
358 U. S. 429.
The factual allegations of the third-party complaint in the present
case comprehend the latter situation.
In the
Ryan and
Weyerhaeuser cases,
considerable emphasis was placed upon the direct contractual
relationship between the shipowner and the stevedore. If those
decisions stood alone, it might well be thought an open question
whether such contractual privity is essential to support the
stevedore's duty to indemnify. But the fact is that this bridge was
crossed in the
Crumady case. There, we explicitly held
that the stevedore's assumption of responsibility for the
shipowner's damages resulting from unsafe and improper performance
of the stevedoring services was unaffected by the fact that the
shipowner was not the party who had hired the stevedore. That case
was decided upon the factual premises that the stevedore
Page 364 U. S. 424
had been engaged not by the shipowner, but by the party
operating the ship under a charter. The Court's language was
unambiguous:
"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's 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, ยง 133. Moreover, as we said in the
Ryan case, 'competency and safety of stowage are
inescapable elements of the service undertaken.' 350 U.S. at
350 U. S. 133. 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.'
Id. at
350 U. S.
133-134.
See MacPherson v. Buick Motor Co., 217
N.Y. 382, 111 N.E. 1050."
"We conclude that, since the negligence of the stevedores, which
brought the unseaworthiness of the vessel into play, amounted to a
breach of the warranty of workmanlike service, the vessel may
recover over."
358 U.S.
358 U. S.
428-429.
This reasoning is applicable here. We can perceive no difference
in principle, so far as the stevedore's duty to indemnify the
shipowner is concerned, whether the stevedore is engaged by an
operator to whom the owner has chartered the vessel or by the
consignee of the cargo. Nor can there be any significant
distinction in this respect whether the longshoreman's original
claim was asserted in an
in rem or an
in personam
proceeding. In the
Ryan and
Weyerhaeuser cases,
in personam liability was asserted. In the
Crumady case, the injured stevedore had brought an
in
rem proceeding. The ship and its owner
Page 364 U. S. 425
are equally liable for a breach by the contractor of the owner's
nondelegable duty to provide a seaworthy vessel.
The
Osceola, 189 U. S. 158,
189 U. S. 175;
cf. Continental Grain Co. v. Barge FBL-585, 364 U. S.
19. The owner, no less than the ship, is the beneficiary
of the stevedore's warranty of workmanlike service.
Accordingly the judgment of the Court of Appeals is reversed,
and the case is remanded to the District Court for further
proceedings consistent with this opinion.
Reversed and remanded.
[
Footnote 1]
The cargo had been loaded in the Philippines several weeks
earlier by a stevedore unrelated to the parties to the present
proceeding.
[
Footnote 2]
272 F.2d 823 (on rehearing).