which caused him to contract a lung disease. Swogger's period of employment aboard these named vessels spanned 29 years from 1949 through 1978.
Discovery in the Swogger action indicated that David Swogger's complaint did not, however, seek recovery for his initial years at sea between the period 1943-1949. During this period, Swogger sailed exclusively aboard vessels owned and/or operated for the United States pursuant to General Agency Agreements by four shipping companies.
In February, 1984, Sea-Land (a defendant in the Swogger action) filed a third-party complaint in New York State naming 52 third-party defendants, including asbestos manufacturers, shipyards, distributors and additional shipping companies. Included within this group of third-party defendants were the four shipowner-employers who, although not named as primary defendants in the Swogger action, operated ships for the United States during 1943-1948 pursuant to the above-noted General Agency Agreements. Pursuant to contractual relations and/or the Suits in Admiralty Act, 46 U.S.C. App. § 741 et seq. ("SIAA"), these four defendants, because they operated as agents of the United States, tendered their defenses to the United States whereupon Sea-Land agreed to their voluntary dismissal from the Swogger action.
On June 24, 1985, Sea-Land reached a settlement in the Swogger action. Thereafter, Sea-Land made payments pursuant to that settlement. Exactly two years later, on June 24, 1987, Sea-Land ("plaintiff") filed the instant suit against the United States ("defendant") pursuant to the provisions of the Public Vessels Act, 46 U.S.C. App. § 782, et seq., and general admiralty law. In this action, Sea-Land seeks indemnity or contribution from the United States for the sums it paid in settlement of the Swogger action due to Swogger's alleged exposure to asbestos while employed aboard the vessels owned or operated by the United States.
Currently, the United States moves to dismiss the complaint, claiming that (i) the action is barred by the applicable statute of limitations and (ii) the relationship between Sea-Land and the United States is such that no valid claim for indemnity exists.
A. Statute of Limitations - Contribution
Section five of the Suits in Admiralty Act, 46 U.S.C. App. § 745, provides, in pertinent part, that suits against the United States "may be brought only within two years after the cause of action arises . . . ." Defendant maintains, therefore, that plaintiff's action is now time-barred because the two-year statute of limitations began to run, at the latest, upon the date of David Swogger's death -- January 10, 1980. Plaintiff, however, did not file the instant action for contribution and indemnity until June 24, 1987 -- more than seven-and-one-half years following Mr. Swogger's death. In response, plaintiff maintains that its cause of action did not accrue until June 24, 1985, the date of the settlement of the Swogger action. Thus, according to plaintiff its action was timely. Therefore, the issue before this Court with respect to the statute of limitations is the determination of precisely when plaintiff's cause of action in its contribution/indemnification action accrued.
(1) The Government's Position. In support of its argument that plaintiff's cause of action accrued in 1980, defendant cites United New York Sandy Hook Pilots' Association v. United States, 355 F.2d 189 (2d Cir. 1965) in which the Second Circuit stated:
The facts pleaded by [the party seeking contribution] gave rise only to a claim against a tortfeasor and that this became time-barred two years after the accident, although the amount had not yet been established. The settlement did nothing to change this.
Id. at 190-191 (emphasis added). See also Complaint of American Export Lines, Inc., 568 F. Supp. 956, 964 (S.D.N.Y. 1983) ("when the Court of Appeals [in Sandy Hook ] referred to 'a claim against a tortfeasor' that was barred by the two year limitations period . . . it was referring to a claim for contribution").
(2) Sea-Land's Position. In contrast to defendant's position, plaintiff asserts that a cause of action for contribution does not accrue at the time of the underlying injury, but rather when the party seeking contribution makes payment on the underlying claim. For example, in Central Rivers Towing v. City of Beardstown, 750 F.2d 565 (7th Cir. 1984), the Seventh Circuit held that a third-party contribution action against the United States brought pursuant to section 5 of the SIAA arose only upon the entry of judgment in the underlying action. The Seventh Circuit continued:
The Suits in Admiralty Act provides that suits under it may be brought against the United States only within two years after the cause of action arises. 46 U.S.C. § 745. Noting that the plaintiff's cause of action against the United States would have arisen at the time of the accident, the government correctly states that a direct suit by the plaintiff would now be barred. But the government goes farther than this, arguing that as a result of its lack of liability to the plaintiff, it cannot share joint liability with the [defendant], and therefore the [defendant] can have no claim of contribution against it. In support of this proposition, the government cites numerous cases in which one joint tortfeasor was immune from tort liability to the plaintiff and the court held that it could not be held liable in contribution to the other tortfeasor.