Smith v. Seaport Marine, Inc.
2013 U.S. Dist. LEXIS 157358
| S.D. Ala. | 2013Background
- Plaintiff Wilbur Smith, a seaman, signed three documents with Seaport Marine (Placement Contract, Power of Attorney, and Paycheck Mailing Agreement (PMA)) agreeing to pay a $3,640 placement fee in six payroll installments; the PMA stated it was "irrevocable" until installments were paid.
- Seaport placed Smith with Odyssea Marine, which, at Smith's written direction, mailed six consecutive paychecks to Seaport, which deposited them and issued Smith the net after the installment deductions.
- Smith sued under general maritime law seeking recovery of the fee as unpaid seaman's wages, contending the wage assignment was unlawful under 46 U.S.C. § 11109(b) because the PMA called the assignment "irrevocable."
- Defendants moved for summary judgment; Smith moved for partial summary judgment. The sole remaining claim was the seaman’s claim for wages; other claims were dismissed or stipulated away.
- The court assumed § 11109(b) makes prepayment assignments non‑binding but found no record evidence that defendants enforced an "irrevocable" term, that Smith relied on or knew of it, or that he was misled or coerced.
- The court granted defendants’ summary judgment and dismissed Smith’s seaman’s wage claim with prejudice, reasoning no statutory violation was shown and equitable maritime principles disfavored granting Smith a windfall.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether PMA's use of the word "irrevocable" violated 46 U.S.C. § 11109(b) | "Irrevocable" conflicts with §11109(b) (assignments before payment are non‑binding) and thus renders the assignment unlawful and void | §11109(b) only makes pre‑payment assignments non‑binding; a conflicting contract term is unenforceable but not per se a statutory violation absent enforcement or prejudice | Court: No violation shown — the term was never enforced, no evidence Smith relied on or sought revocation, so §11109(b) was not breached on record |
| Whether a general maritime (wards‑of‑admiralty) remedy exists for §11109(b) violations | Court should recognize an equitable maritime remedy to recover wages lost to unlawful assignment language | Miles and related precedent counsel against judicially creating remedies where Congress did not provide one | Court: Need not decide the broader question because no statutory violation was proven; moreover, creating such a remedy here would be inequitable and contrary to precedent |
| Whether Odyssea owed an affirmative duty to advise Smith about the PMA or ignore his written direction | Odyssea should have refused to honor the PMA or advised Smith each pay period that the PMA was legally non‑binding before forwarding wages | No precedent imposes a duty on an employer to provide unsolicited legal advice or to disregard an employee's unambiguous written instruction | Court: Odyssea had no duty to give legal counsel or ignore Smith's written direction; Huseman persuasive; claim against Odyssea fails |
| Whether the PMA's defective term voids the related contracts or just the assignment | The single "irrevocable" term voids the PMA and, by extension, the Placement Contract, entitling Smith to recover the fee | A collateral illegal or incorrect term does not automatically void the whole contract; equity and contract law bar permitting Smith to keep benefits while avoiding obligations | Court: The PMA term, even if inconsistent, would not invalidate the Placement Contract; equity forbids returning an earned fee where Smith received full benefit |
Key Cases Cited
- Wilder v. Inter-Island Steam Nav. Co., 211 U.S. 239 (policy background protecting seamen from being left ashore without wages)
- Garrett v. Moore-McCormack Co., 317 U.S. 239 (discussing special scrutiny of seamen's contracts)
- Miles v. Apex Marine Corp., 498 U.S. 19 (admonition that courts should be cautious creating general maritime remedies when Congress has not provided them)
- Exxon Shipping Co. v. Baker, 554 U.S. 471 (discussion of courts' role formulating maritime remedies and limits)
- Lindo v. NCL (Bahamas), Ltd., 652 F.3d 1257 (11th Cir.) (recognizing seamen as wards of admiralty; continued solicitude)
- Huseman v. Icicle Seafoods, Inc., 471 F.3d 1116 (9th Cir.) (rejecting a duty on employer to advise seaman of potential federal claims; persuasive on no duty to advise about wage assignments)