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Sea-Land Service Inc. v. Director

argued: June 8, 1976.



Aldisert, Gibbons and Garth, Circuit Judges.

Author: Gibbons


GIBBONS, Circuit Judge.

This is a petition by an employer to review an order of the Benefits Review Board reversing an order of the administrative law judge which denied benefits to an employee, Wallace Johns, under the Longshoremen's and Harbor Workers' Compensation Act (LHWCA).*fn1 The administrative law judge had held that although Johns was engaged in maritime employment at the time of the accident, he was not injured at a situs within the coverage of the Act. The Board concluded that Johns was engaged in maritime employment and was injured at a covered situs. The problem arises out of the 1972 amendments to the LHWCA,*fn2 and is of first impression in this court.

Johns was employed at the time of the accident by Sea-Land Service, Inc., an intermodal freight carrier that engages in shipping, stevedoring, warehousing, freight consolidation and motor freight operations. Johns' injury occurred when the flatbed truck he was driving, laden with a large crate, overturned on a public street in Port Elizabeth, New Jersey. Port Elizabeth is a part of the sprawling marine terminal area in Newark and Elizabeth, New Jersey that is operated by the Port of New York and New Jersey Authority. Many longshoremen who are covered by the LHWCA are employed at various locations in the marine terminal area. Many other workers in the terminal area are employed by railroads, and are covered by the Federal Employers' Liability Act.*fn3 Still others, including teamsters, warehousemen, clerks, secretaries and even bank tellers, who work in the marine terminal area are covered by the New Jersey Workmen's Compensation Act.*fn4 All, or at least most, of these employees, are engaged in facilitating the transfer of cargo at the interface between waterborne modes of transportation and land or airborne modes of transportation. Our problem in this case is to determine on which side of the interface Johns was employed when he was injured. That his employer is an intermodal carrier complicates the problem somewhat, although analytically the fact that a single corporate employer operates several modes of transportation should not influence our judgment respecting the statutory reach of the federal and state workmen's compensation laws.


Johns was a member of the International Longshoremen's Association, but he was not regularly employed by Sea-Land. On the date of the accident Johns had been hired by Sea-Land for the day (a "shape-up" employee) through the Bi-State Waterfront Commission, which operates a longshoring hiring hall. After appearing for work, Johns agreed to work as a shuttle driver, moving with a tractor rig trailers between Sea-Land's old terminal facility at Berth 52, and its new terminal at Berth 90. Both terminal facilities were enclosed by a fence and were under the control of the employer. The shuttle-run between the two terminals followed public streets for a distance greater than a mile and a half. Johns began his day by hitching a trailer to his tractor at Berth 52 and moving it to Berth 90. While he was making a turn from Rangoon Street onto Bombay Street, an intersection in the public area of the marine terminal, situated one-half mile from the nearest water and one-third mile from Sea-Land's property, the rig overturned and caused Johns' injury. On the day of the accident Sea-Land was in the process of moving its operations from Berth 52 to a larger facility at Berth 90.

Johns originally filed a claim against Sea-Land with the New Jersey Department of Labor and Industry. Payments were made under the New Jersey schedule from January 31, 1973 until March 16, 1973. On July 5, 1973 Johns filed a new claim under the federal statute, which provides for higher benefits. Sea-Land resisted that claim, contending that at the time of the injury the claimant was covered by the New Jersey and not the federal statute. The formal proceedings before the administrative law judge and the Benefits Review Board produced the results described above. Neither the administrative law judge nor the Board made any findings with respect to the contents of the crate that Johns was hauling at the time of the accident, its origin, or its destination. Nor did either make any finding as to whether a vessel was berthed at or expected at Berth 52. Under our interpretation of the 1972 amendments these facts may be of critical importance.


Prior to 1972 the term "employee" was defined in § 2(3) of the LHWCA, 33 U.S.C. § 902(3) only negatively:

"The term 'employee' does not include a master or member of a crew of any vessel, nor any person engaged by the master to load or unload or repair any small vessel under eighteen tons net."

The scope of the Act's affirmative coverage was derived from the definition of "employer" in § 2(4), and the "coverage" provision in § 3(a). An "employer" was described as an employer of persons "employed in maritime employment, in whole or in part, upon the navigable waters of the United States (including any dry dock)." 33 U.S.C. § 902(4). Compensation was payable under § 3(a) "only if the disability or death results from an injury occurring upon the navigable waters of the United States (including any dry dock) and if recovery for the disability or death through workmen's compensation proceedings may not validly be provided by State law." 33 U.S.C. § 903(a). The pre-1972 definitions had originated in the 1927 statute, which was tailored by Congress to fill a void created by the Supreme Court's holding in Southern Pacific Co. v. Jensen, 244 U.S. 205, 61 L. Ed. 1086, 37 S. Ct. 524 (1917), that state workmen's compensation laws were inoperative in the navigable waters of the United States. See G. Gilmore & C. Black, The Law of Admiralty § 6-45 (2d ed. 1975). The Jensen decision left longshoremen injured on the landward side of a pier with a possible remedy under state workmen's compensation laws, but in the absence of federal legislation not covered when they stepped from the pier onto the gangplank. State Industrial Commission v. Nordenholt Corp., 259 U.S. 263, 66 L. Ed. 933, 42 S. Ct. 473 (1922). The 1927 statute, instead of adopting federal coverage for the entire longshoring operation, merely provided a remedy which filled in the gap created by the Jensen holding. See Gilmore & Black, supra, § 6-48, at 417. In Nacirema Operating Co. v. Johnson, 396 U.S. 212, 24 L. Ed. 2d 371, 90 S. Ct. 347 (1969), the Court held that the Extension of Admiralty Jurisdiction Act of 1948, 46 U.S.C. § 740, did not change the basic approach of the 1927 statute, and that pierside injuries were still covered by state workmen's compensation laws. The Nacirema court made it clear, however, that there was no constitutional barrier to congressional action preempting the entire longshoremen's compensation field to the exclusion of state law.*fn5 It merely held that the 1927 statute could not be so construed. That holding pointed up the continuing anomaly that the schedule of benefits to be applied in any case depended on whether the injury occurred on the land or water side of the gangplank.

In 1972 Congress addressed this anomaly in a complex statute reflecting a number of compromises among conflicting interests.*fn6 Of concern for purposes of this case are the revised definitions of "employer," § 2 (3), and "employee," § 2 (4), and the revised "coverage" provision of § 3(a). In place of the merely negative definition of "employee" given by the 1927 Act (which excluded crew members), Congress substituted the following language:

"The term 'employee' means any person engaged in maritime employment, including any longshoreman or other person engaged in longshoring operations, and any harborworker including a ship repairman, shipbuilder, and shipbreaker, but such term does not include a master or member of a crew of any vessel or any person engaged ...

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