Hawaii Personal Injury Attorney - Jones Act
   

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Jones Act - Seaman

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On June 29, 2015, the Hawaii Supreme Court rendered its decision in the case of St. Paul Fire and Marine Ins. Co. v. Liberty Mutual Insurance, Hi. Sup. Ct. Case No SCCQ-14-0000727 (June 29, 2015). This case arose out of a wrongful death personal injury case handled by this office which resulted in a $4.1 million verdict in favor of our clients - even though Liberty Mutual, the primary liability insurer, never offered anything even close to its policy limits of $1 million. St. Paul - who had to pay our clients everything recovered in excess of the initial $1 million - claimed that Liberty Mutual committed bad faith towards it by failing to settle within its $1 million policy limits. The Hawaii Supreme Court agreed and found that an excess insurer has claims for bad faith against a primary insurer.

 

 


JONES ACT- TABLE OF CONTENTS

The Jones Act

VI. DAMAGES C. Damages For Wrongful Death 2. Computation of Award

498. Net or gross earnings

In computing loss of future earnings to disabled seaman under Jones Act (46 USCS Appx § 688), gross earnings should not be used; unless amounts worker would have been required to pay in income taxes and social security taxes is negligible or should, for some articulated reason, be disregarded, lost income stream must be computed after deducting income taxes and social security taxes worker would have paid had he continued to work. Madore v Ingram Tank Ships, Inc. (1984, CA5 Tex) 732 F2d 475.

Child's loss of support in action under 46 USCS Appx § 688 is not measured by his father's net earnings at time of death, but by gross earnings. Hamilton v Canal Barge Co. (1975, ED La) 395 F Supp 978 (disapproved on other grounds Culver v Slater Boat Co. (CA5 La) 688 F2d 280, op withdrawn, in part (CA5 La) 722 F2d 114, cert den 467 US 1252, 82 L Ed 2d 842, 104 S Ct 3537 and cert den (US) 83 L Ed 2d 37, 105 S Ct 90).


499. Wage increases and decreases

In action brought under 46 USCS Appx § 688, contention that damages should be reduced because of likelihood of wage reduction, may be offset by evidence of possibility that had decedent survived, it would reasonably have been expected that he would have received promotions. Pollard v Seas Shipping Co. (1945, CA2 NY) 146 F2d 875.

In action brought under 46 USCS Appx § 688 and general maritime law by representative of decedent, expert testimony with respect to future wage increases which might have occurred due to decedent's developing skill and experience should be admitted. Morvant v Construction Aggregates Corp. (1978, CA6 Tenn) 570 F2d 626, 2 Fed Rules Evid Serv 994, cert dismd 439 US 801, 58 L Ed 2d 94, 99 S Ct 44.

In action under 46 USCS Appx § 688, court erred in allowing parties to introduce evidence of wage increases seaman would have received as result of factors other than inflation. Ober v Penrod Drilling Co. (1984, CA5 La) 726 F2d 1035.

Claim for wages lost to date of trial in wrongful death action brought under 46 USCS Appx § 688 will be disallowed where pecuniary loss is determined according to life expectancy as of date of death, such allowance for wage loss between death and date of trial would be duplicitous. Trexler v Tug Raven (1968, ED Va) 290 F Supp 429, revd on other grounds (CA4 Va) 419 F2d 536, cert den 398 US 938, 26 L Ed 2d 271, 90 S Ct 1843.

Under 46 USCS Appx § 688, Death on High Seas Act (46 USCS Appx § § 761 et seq.), and general maritime law, dependent survivors of each of decedents killed at sea due to helicopter crash were entitled to recover damages for loss of contributions and support they would have received out of accrued and future gross earnings of decedents had they lived. Higginbotham v Mobil Oil Corp. (1973, WD La) 360 F Supp 1140, affd in part and revd in part on other grounds (CA5 La) 545 F2d 422 (disagreed with Smith v M/V Captain Fred (CA5 La) 546 F2d 119) as stated in Longmire v Sea Drilling Corp. (CA5 La) 610 F2d 1342, reh den (CA5 La) 615 F2d 919 and (disagreed with on other grounds Steckler v United States (CA10 Colo) 549 F2d 1372, 38 ALR Fed 188 (disagreed with Smith v United States (CA3 Pa) 587 F2d 1013)) and revd on other grounds 436 US 618, 56 L Ed 2d 581, 98 S Ct 2010, on remand (CA5 La) 578 F2d 565 and reh den 439 US 884, 58 L Ed 2d 200, 99 S Ct 232 and (ovrld on other grounds Culver v Slater Boat Co. (CA5 La) 688 F2d 280, op withdrawn, in part (CA5 La) 722 F2d 114, cert den 467 US 1252, 82 L Ed 2d 842, 104 S Ct 3537 and cert den (US) 83 L Ed 2d 37, 105 S Ct 90) and (disapproved on other grounds Jones & Laughlin Steel Corp. v Pfeifer, 462 US 523, 76 L Ed 2d 768, 103 S Ct 2541, on remand (CA3) 711 F2d 570).

Posthumous child's loss of support is measured by decedent's gross earnings at time of death, plus probable future increased earnings, and damages caused by loss of his father's society. Hamilton v Canal Barge Co. (1975, ED La) 395 F Supp 978 (disapproved on other grounds Culver v Slater Boat Co. (CA5 La) 688 F2d 280, op withdrawn, in part (CA5 La) 722 F2d 114, cert den 467 US 1252, 82 L Ed 2d 842, 104 S Ct 3537 and cert den (US) 83 L Ed 2d 37, 105 S Ct 90).


500. Deduction for income taxes

Deduction of taxes payable on estimated future earnings from gross income, in determination of damages for wrongful death in action under 46 USCS Appx § 688, was error under record showing that estimated annual earnings of decedents did not exceed $ 11,500. Petition of Marina Mercante Nicaraguense, S.A. (1966, CA2 NY) 364 F2d 118, 3 ALR Fed 187, cert den 385 US 1005, 17 L Ed 2d 544, 87 S Ct 710, reh den 386 US 929, 17 L Ed 2d 803, 87 S Ct 851.

No deduction for income taxes should be made where annual estimated earnings are not above reach of middle income scale. Petition of M/V Elaine Jones (1973, CA5 Miss) 480 F2d 11, amd on other grounds (CA5 Miss) 513 F2d 911, cert den 423 US 840, 46 L Ed 2d 60, 96 S Ct 71 and (ovrld on other grounds Culver v Slater Boat Co. (CA5 La) 688 F2d 280, op withdrawn, in part (CA5 La) 722 F2d 114, cert den 467 US 1252, 82 L Ed 2d 842, 104 S Ct 3537 and cert den (US) 83 L Ed 2d 37, 105 S Ct 90).

In determining extent of loss from future earnings of decedents killed in helicopter crash at sea court stated that no deduction for state and federal income taxes should be made where yearly estimated earnings are not clearly above reach of middle income scale. Higginbotham v Mobil Oil Corp. (1973, WD La) 360 F Supp 1140, affd in part and revd in part on other grounds (Ca5 La) 545 F2d 422 (disagreed with Smith v M/V Captain Fred (CA5 La) 546 F2d 119) as stated in Longmire v Sea Drilling Corp. (CA5 La) 610 F2d 1342, reh den (CA5 La) 615 F2d 919 and (disagreed with on other grounds Steckler v United States (CA10 Colo) 549 F2d 1372, 38 ALR Fed 188 (disagreed with Smith v United States (CA3 Pa) 587 F2d 1013)) and revd on other grounds 436 US 618, 56 L Ed 2d 581, 98 S Ct 2010, on remand (CA5 La) 578 F2d 565 and reh den 439 US 884, 58 L Ed 2d 200, 99 S Ct 232 and (ovrld on other grounds Culver v Slater Boat Co. (CA5 La) 688 F2d 280, op withdrawn, in part (CA5 La) 722 F2d 114, cert den 467 US 1252, 82 L Ed 2d 842, 104 S Ct 3537 and cert den (US) 83 L Ed 2d 37, 105 S Ct 90) and (disapproved on other grounds Jones & Laughlin Steel Corp. v Pfeifer, 462 US 523, 76 L Ed 2d 768, 103 S Ct 2541, on remand (CA3) 711 F2d 570).


501. Personal expenses of decedent

In action under 46 USCS Appx § 688, personal expenditures of decedent must be deducted from award. Gardner v National Bulk Carriers, Inc. (1963, ED Va) 221 F Supp 243, affd (CA4 Va) 333 F2d 676.

Before attempting to ascertain pecuniary loss to widow and children of deceased seaman, it is first necessary to allocate and deduct Seaman's likely personal expenditures. Trexler v Tug Raven (1968, ED Va) 290 F Supp 429, revd on other grounds (CA4 Va) 419 F2d 536, cert den 398 US 938, 26 L Ed 2d 271, 90 S Ct 1843.

Damages under 46 USCS Appx § 688 reflecting decedent's lost wages must be adjusted to reflect amount decedent would have spent on himself and as his part of household expenses. Hebert v Otto Candies, Inc. (1975, ED La) 402 F Supp 503.


502. Actuarial tables

In computing damages due disabled seaman under Jones Act (46 USCS Appx § 688), District Court erred in basing award on work-life expectancy of 30.8 years, presumably because seaman would reach age 65 at that time, where experts in action testified that seaman had work-life expectancy of 25.8 years, based on rates compiled by Department of Labor; rates compiled by Department are not conclusive, but such rates should be followed absent evidence that particular person, by virtue of health, occupation, or other factors, is likely to live and work longer, or shorter period than average person. Madore v Ingram Tank Ships, Inc. (1984, CA5 Tex) 732 F2d 475.

In action brought under 46 USCS Appx § 688, mortality tables used in computing damages are intended as guide; to get value of reasonably to be expected contribution, earning power of money must be considered amount which, if capitalized at reasonable rate of interest, would yield annually same income person injured might have expected from deceased. Poindexter v Groves (1951, DC NY) 103 F Supp 657, affd (CA2 NY) 197 F2d 915.

Mortality and annuity tables are merely guides to assist jury in reaching verdict and do not furnish rules which jury must necessarily follow; amount to be awarded for future loss of pecuniary benefits is not to be arrived at by mere ascertainment of monthly payments and life expectancy, but present value of aggregate future payments must be ascertained and for this purpose annuity figures are utilized showing different interest calculations upon which such present value is ascertained. Holliday v Pacific Atlantic S.S. Co. (1953, DC Del) 117 F Supp 729, affd (CA3 Del) 212 F2d 206.

In action brought under 46 USCS Appx § 688, mortality and annuity tables may be considered, but are not fixed rules in computation of damages. Petition of Southern S.S. Co. (1955, DC Del) 135 F Supp 358.


503. Effect of inflation

Taking inflationary trends in economy into account in computing future lost earnings is approved. Johnson v Penrod Drilling Co. (1972, CA5 Tex) 469 F2d 897, 16 FR Serv 2d 766, on reh (CA5 Tex) 510 F2d 234, cert den 423 US 839, 46 L Ed 2d 58, 96 S Ct 68, 96 S Ct 69 Culver v Slater Boat Co. (CA5 La) 722 F2d 114, cert den 467 US 1252, 82 L Ed 2d 842, 104 S Ct 3537 and cert den (US) 83 L Ed 2d 37, 105 S Ct 90.

In action under 46 USCS Appx § 688, court may include in damage award adjustment of damage computation by anticipated annual increase in cost of living. Petition of M/V Elaine Jones (1973, CA5 Miss) 480 F2d 11, amd on other grounds (CA5 Miss) 513 F2d 911, cert den 423 US 840, 46 L Ed 2d 60, 96 S Ct 71 and (ovrld on other grounds Culver v Slater Boat Co. (CA5 La) 688 F2d 280, op withdrawn, in part (CA5 La) 722 F2d 114, cert den 467 US 1252, 82 L Ed 2d 842, 104 S Ct 3537 and cert den (US) 83 L Ed 2d 37, 105 S Ct 90).

It is not error for trial court to refuse to instruct as to inflation or present value. Haupt v Atwood Oceanics, Inc. (1982, CA5 Tex) 681 F2d 1058, CCH Prod Liab Rep P 9370, 10 Fed Rules Evid Serv 1643, reh den (CA5 Tex) 688 F2d 840 and reh den (CA5 Tex) 688 F2d 840.


504. --Discount of award

In action by injured seaman under 46 USCS Appx § 688, in which it was established that injuries were caused by employer's breach of duty to furnish seaman with reasonably safe workplace, District Court erred in applying Alaska Rule in calculating damages, rather than below-market discount method, and by allowing parties opportunity to introduce evidence of wage increases seaman would have received as result of factors other than inflation. Ober v Penrod Drilling Co. (1984, CA5 La) 726 F2d 1035.

In computing damages due disabled seaman under Jones Act (46 USCS Appx § 688), District Court erred in applying discount rate of 6.56 percent based on 21 year average of rates paid on United States Treasury bills, rather than on market rates available at time of judgment. Madore v Ingram Tank Ships, Inc. (1984, CA5 Tex) 732 F2d 475.

Jury awards made in action under 46 USCS Appx § 688 are not to be discounted to present values. Ivy v Security Barge Lines, Inc. (1976, DC Miss) 424 F Supp 1154, revd on other grounds (CA5 Miss) 585 F2d 732, on reh (CA5 Miss) 606 F2d 524, cert den 446 US 956, 64 L Ed 2d 815, 100 S Ct 2927, reh den 448 US 912, 65 L Ed 2d 1173, 101 S Ct 27 and on remand (ND Miss) 89 FRD 322.

Survivor's future pecuniary loss must be discounted to present value for purposes of present payment by employing appropriate interest rate prevailing at time and place of trial. Thompson v Offshore Co. (1977, SD Tex) 440 F Supp 752 (disapproved on other grounds Culver v Slater Boat Co. (CA5 La) 688 F2d 280, op withdrawn, in part (CA5 La) 722 F2d 114, cert den 467 US 1252, 82 L Ed 2d 842, 104 S Ct 3537 and cert den (US) 83 L Ed 2d 37, 105 S Ct 90).


505. Distribution of award

Damages to be awarded for death of seaman in action brought under 46 USCS Appx § 688 need not be apportioned. Otis v State (1944, Ct Cl) 47 NYS2d 755.

It is not necessary for jury to apportion verdict between widow and child in action under 46 USCS Appx § 688, since better practice is to instruct jury to bring in verdict in single lump sum, leaving distribution or administration of fund for appropriate state court. Tompkins v Pilots Asso. for Bay & River Delaware (1940, DC Pa) 32 F Supp 439, 1940 AMC 716.

In action under 46 USCS Appx § 688, pecuniary loss is accepted basis for recovery, and period that such loss will be sustained must be factor to receive consideration, and apportionment among several children of decedent should be made depending upon their different ages and whether they are actually being supported by spouse. Petition of Southern S.S. Co. (1955, DC Del) 135 F Supp 358.

Widow's recovery in action brought for recovery of damages resulting from death of husband under 46 USCS Appx § 688, is limited to amount her husband might reasonably have been expected to contribute to her had he lived; where decedent is survived by widow but not by children, widow's recovery should be limited to 50 percent of decedent's lost earnings. Mpiliris v Hellenic Lines, Ltd. (1969, DC Tex) 323 F Supp 865, affd (CA5 Tex) 440 F2d 1163.

Distribution of recovery for death of stevedore is governed by 46 USCS Appx § 688 and not by state law. Re De Martino's Estate (1932) 142 Misc 431, 254 NYS 862.

Recovery for death is to be distributed among injured parties in proportion to their loss, and death of injured party before fixing of damages does not defeat recovery. Re Uravic's Estate (1932) 142 Misc 775, 255 NYS 638.

State court has jurisdiction under 46 USCS Appx § 688 to determine apportionment among dependents of seaman. Re Nelson (1938) 168 Misc 161, 5 NYS2d 398, 1938 AMC 1068.

Distribution of award under 46 USCS Appx § 688 is governed by federal law and not state law; statute applicable is Federal Employers' Liability Act (45 USCS § § 51 et seq.) incorporated by reference in 46 USCS Appx § 688. Re Cooperman's Estate (1955) 208 Misc 234, 143 NYS2d 196.

Seaman's second marriage being illegal, having taken place less than one year after divorce decree, court apportioned damages for his death at sea between children of his first and second marriages. Re Tufts' Estate (1938) 228 Wis 221, 280 NW 309.


506. Miscellaneous

Measure of damages is compensation for deprivation of reasonable expectation of pecuniary benefits that would have resulted from continued life of deceased, and in estimating, earning power of money must be considered and amount determined which, capitalized at reasonable rate of interest, would yield annually same income injured person might have expected from deceased. Sabine Towing Co. v Brennan (1936, CA5 Tex) 85 F2d 478, cert den 299 US 599, 81 L Ed 441, 57 S Ct 191, reh den 299 US 624, 81 L Ed 459, 57 S Ct 234.

District Court committed reversible error when it admitted into evidence, over defendant's objections, slide-rule type device called "Future Damage Calculator" and took notice of plaintiff's life expectancy as calculated by device, where no foundation was laid for exhibit and exhibit was hearsay. Crane v Crest Tankers (1995, CA8 Mo) 47 F3d 292, 41 Fed Rules Evid Serv 351.

Though local law prohibited assignment of claim for personal injuries, assignment of proceeds of judgment received as result of action brought under 46 USCS Appx § 688 was valid. Sperling v McCarthy (1956, DC NY) 142 F Supp 780.

In claim under 46 USCS Appx § 688 prosecuted for benefit of widow, of decedent seaman, recovery is based upon and limited by pecuniary loss sustained by spouse; sums paid to widow under liability insurance policy taken out by shipowner and on which he paid all premiums must be deducted from award. Petition of Gulf Oil Co. (1963, DC RI) 221 F Supp 1000.

JONES ACT- TABLE OF CONTENTS


 

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