Christian Joseph Gibbs; Suzanne Gibbs; Richard Gibbs, Appellants v. CARNIVAL CRUISE LINES; Carnival Corporation; ABC Companies 1-10, (said names being fictitious as their identities are presently unknown); John Does 1-10, (said names being fictitious as their identities are presently unknown)
No. 01-4101
United States Court of Appeals, Third Circuit
Argued Oct. 16, 2002. Filed Dec. 20, 2002.
314 F.3d 125
BECKER, Chief Judge.
Christian Joseph GIBBS, an infant by his Guardian ad Litem Suzanne Gibbs; Suzanne Gibbs; Richard Gibbs, Individually v. CARNIVAL CRUISE LINES; Carnival Corporation; ABC Companies 1-10, (said names being fictitious as their identities are presently unknown); John Does 1-10, (said names being fictitious as their identities are presently unknown)
In view of the foregoing, we hold that the district court erred in granting the motion of National and Sterling to dismiss Levy‘s complaint for failure to state a claim on which relief сan be granted. We disagree with the district court‘s holding that Rule 16b-7 exempted the reclassification transaction as a matter of law and we do not conclude at this time that the reclassification transaction is outside the definition of “purchase” under section 16(b). We also reject the alternative basis that National and Sterling have advanced for supporting the judgment below—Rule 16b-3(d)—as inapplicable. Thus, we will reverse the order of February 5, 2002, dismissing this action and will remand the matter to the district court for further proceedings consistent with this opinion.
Michael E. Unger (Argued), Pamela A. Whipple, Freehill, Hogan & Mahar, Jersey City, NJ, for Appellee.
Before BECKER, Chief Judge, ROTH and ROSENN, Circuit Judges.
OPINION OF THE COURT
BECKER, Chief Judge.
The passenger ticket contract between the Gibbses and Carnival included a provision that contained the minimum one year limitation allowable under the statute. The Gibbses and Carnival disagree as to when (or whеther) Suzanne Gibbs was appointed guardian ad litem of Christian in order to serve as his “legal representative.” Carnival contends that the appointment occurred on March 25, 1999, the date of a letter from the Gibbses’ attorney informing Carnival that he “has been retained by Suzanne Gibbs, individually and as Guardian ad Litem for Christian Joseph Gibbs.” Under this interpretation, the one year time-bar to file suit would have ended on March 25, 2000, well before the Gibbses filed this action before the District Court on August 21, 2000. The Gibbses respond that this letter has no legal effect, and that under
The District Court declined to resolve this aspect of the dispute. Instead, it concluded that the March 25, 1999 letter from the Gibbses’ attorney to Carnival was legally binding and estopped the Gibbses from arguing that the New Jеrsey Court Rule applied. Determining that the March 25, 1999 date of the letter is the time that Christian Gibbs received a legal representative, the Court granted Carnival‘s motion to dismiss the case because it was filed after the one year time-bar expired.
Before we address the estoppel issue, however, we must first clarify the appropriate choice of law. Although it appears that the District Court considered this case to be one that sounded in admiralty, it did not specify whether it applied the federal admiralty law of estoppel or New Jersey‘s standard. This omission is reflected in the briefs of thе parties, which referred only to New Jersey law. At oral argument before us, Carnival conceded that federal admiralty law governs, but the Gibbses maintained that we should apply New Jersey law. We agree with Carnival. Because Christian Gibbs‘s injuries occurred aboard a cruise ship in navigable waters, his cause of action contains the traditional nexus for maritime torts.
In order to sustain a claim of estoppel under federal admiralty law, a party must show that it relied in good faith on a misrepresentation of another party, and that this reliance caused it to change its position for the worse. Evidence of detrimental reliance or prejudice is a critical element of estoppel, and Carnival fails to
Having disposed of the estoppel issue, we must still determine whether the Gibbses’ claim is barred by the suit timе provision in the passenger ticket contract. This presents the question not directly addressed by the District Court: How is a legal representative “appointed” within the meaning of
Therefore, under the guardian ad litem appointment process envisioned by
I.
On August 25, 1998, while accompanying his parents on a cruise, Christian Gibbs suffered second degree burns on the soles of his feet when he stepped onto the hot surface of the deck of the Carnival vessel, The Destiny. He was in the care of Carnival employees at the time as part of the Camp Carnival child care program. His parents, Suzanne and Richard, decided to interrupt their vacation and return home to New Jersey with Christian to care for his injuries.
After engaging in settlement discussions with Carnival, the Gibbses retained the Law Offices of Gold and Albanese (“Gold and Albanese“) to represent their interests. On March 25, 1999, Robert Francis Gold, an attorney at Gold and Albanese, wrote to Carnival informing it that the firm “has been retained by Suzanne Gibbs, individually and as Guardian ad Litem for Christian Joseph Gibbs, to represent their
The Gibbses then commenced this action in the District Court on August 21, 2000, alleging that Carnival was liable for negligence, infliction of emotional distress, and breach of contract. The cоmplaint sought relief on behalf of Christian as well as his parents. Carnival moved to dismiss the case pursuant to
The District Court granted Carnival‘s motion on the first ground—untimeliness according to the one year time-bar in the passenger ticket contract. Finding that the passenger ticket contract contained an enforceable provision allowing only one year to file suit on any claims arising from the contract, the Court applied the provision against the Gibbses and dismissed Suzanne and Richard Gibbs‘s individual claims. Maritime carriers are entitled to impose contractual limitations on the time to bring a lawsuit so long as the allowable period is no less than one year.
The Court also dismissed Christian Gibbs‘s claims, but on a different theory. Noting that Christian was a minor and therefore that
The Court therefore refused to entertain the Gibbses’ submission that Suzanne Gibbs was not appointed legal representative for Christian by the March 25 letter because
Instead, the Court looked at the language of the March 25 letter and found that it clearly communicated to Carnival that Suzanne Gibbs had been appointed legal representative of Christian on or about that date. The Court chose to apply the law of estoppel because it bеlieved that allowing the Gibbses to disavow the depiction of Suzanne Gibbs as legal representative for Christian in the March 25 letter in favor of their new theory “squarely brings into play the concept of estoppel which goes right to the fairness issue.” Accordingly, the Court ruled that the Gibbses should have filed Christian‘s claims within one year after March 25, 1999. Since the complaint was not filed in the District Court until August 21, 2000, the Court held that it was untimely. The Gibbses’ appeal of the District Court‘s order granting Carnival‘s 12(b)(6) motion that dismissed Christian Gibbs‘s claims is the issue before this court. We have appellate jurisdiction under
II. Choice of Law
In their complaint, the Gibbses invoked diversity jurisdiction, pursuant to
The initial step in the choice of law analysis is to determine whether this case “sounds in admiralty.” In Jerome B. Grubart, Inc. v. Great Lakes Dredge & Dock Co., 513 U.S. 527, 115 S.Ct. 1043, 130 L.Ed.2d 1024 (1995), the Supreme Court summarized prior precedent and articulated a three-point test for ascertaining when a case sounds in admiralty. First, the incident must have “occurred on navigable water or [be an] injury suffered on land [that] was caused by a vessel on navigable water.” Id. at 534, 115 S.Ct.
We are satisfied that the Gibbses’ claims sound in admiralty under this analysis. First, the injuries to Christian Gibbs transpired on the Carnival Cruise Lines vessel, The Destiny, which was traveling in navigable waters. Second, ocean-going passenger vessels are clearly engaged in maritime commerce. See East River S.S. Corp. v. Transamerica Delaval, 476 U.S. 858, 864, 106 S.Ct. 2295, 90 L.Ed.2d 865 (1986). Finally, the defective design or manufacture of parts of a boat designed for maritime use, such as the deck of a cruise ship, bears a substantial relationship to traditional maritime activity. E.g., Mink ex rel. Ins. Co. of N. Am. v. Genmar Indus., 29 F.3d 1543, 1547 (11th Cir.1994) (citing cases where products liability actions involving pleasure craft in navigable waters sounded in admiralty law).
Although the Gibbses’ complaint alleged more than mere products liability—they also claimed breach of contract, infliction of emotional distress, and negligence on the part of Carnival employees—the analysis pointing to a nexus with maritime commerce is still present. See Fedorczyk v. Caribbean Cruise Lines Ltd., 82 F.3d 69, 73 (3d Cir.1996) (concluding that a slip in a bathtub in a ship сabin “has a nexus to ‘traditional maritime activity” despite the fact that the injury was not a uniquely maritime occurrence); Friedman v. Cunard Line Ltd., 996 F.Supp. 303, 307 (S.D.N.Y.1998) (noting that “even assuming that a maritime nexus is necessary to establish admiralty jurisdiction over a tort committed on the high seas (a question the Supreme Court left open in East River Steamship Corp. and does not appear to have subsequently addressed), that nexus is established by the role that ocean-going cruise ships play in maritime commerce“). The Court of Appeals for the Ninth Circuit has also specifically held that intentional infliction of emotional distress torts that occur on board cruise vessels are governed by maritime law. Wallis ex rel. Wallis v. Princess Cruises, Inc., 306 F.3d 827, 840 (9th Cir.2002).
Moreover, as to the contract claims, it is settled jurisprudence that passenger ticket contracts for cruises are maritime contracts governed by federal admiralty law. Carnival Cruise Lines v. Shute, 499 U.S. 585, 590, 111 S.Ct. 1522, 113 L.Ed.2d 622 (1991); see also Schenck v. Kloster Cruise, Ltd., 800 F.Supp. 120, 122 (D.N.J.1992), aff‘d, 993 F.2d 225 (3d Cir.1993); Vavoules v. Kloster Cruise Ltd., 822 F.Supp. 979, 982-83 (S.D.N.Y.1993) (stating that since 1946, “courts, without exception, have applied federal maritime law in cases involving passenger cruise tickets and other maritime contracts,” and citing examples).
Since we conclude that this case sounds in admiralty, we apply federal admiralty law and not the law of New Jersey or any other state. That the District Court took this case under diversity jurisdiction, rather than admiralty jurisdiction undеr
III. Estoppel
With the choice of law issue resolved, we turn to a review of the District Court‘s order dismissing Christian Gibbs‘s claims. According to federal maritime law, the doctrine of “equitable estoppel is grounded оn a notion of fair dealing and good conscience. It is designed to aid the law in the administration of justice where without its aid injustice might result.” Marine Transp. Svcs. Sea-Barge Group, Inc. v. Python High Perf. Marine Corp., 16 F.3d 1133, 1138 (11th Cir.1994) (internal quotation omitted). In Oxford Shipping Co., Ltd. v. New Hampshire Trading Corp., 697 F.2d 1, 4 (1st Cir.1982), (then) Judge Breyer explained:
Traditionally, the doctrine of equitable estoppel operates to preclude a party who has made representations of fact through his words or conduct from asserting rights which might perhaps have otherwise existed as against another person, who has in good faith relied upon such conduct, and has been led thereby to change his position for the worse, and who on his part acquirеd some corresponding right.
Id. (quotations and alterations omitted).1
The District Court did not explicitly state the factors that led it to prevent Suzanne Gibbs from asserting that she became the legal representative of Christian Gibbs only when the Gibbses filed this lawsuit. However, what plainly (and understandably) disturbed the Court was that Suzanne Gibbs “could on the one hand assert guardian ad litem status in March of 1999, for purposes of asserting Christian‘s interests. And then disavow that status for purposes of resisting the challenge to this lawsuit as being out of time.” Finding this to be unfair, the Court “estopped [the Gibbses] from denying that Christian Gibbs had the same guardian ad litem,” Suzanne Gibbs, from the date that the March 25, 1999 letter was sent to Carnival.
Although the Gibbses’ actions might be off-putting, they do not rise to the level of injustice that the law of estoppel is designed to redress. The Gibbses argue that the District Court erred on two scores. First, the March 25, 1999 letter was merely advisory and had no legal weight because of the New Jersey Court Rules on the appointment of guardians ad litem. Second, Carnival exhibited no detrimental reliance on the letter and suffered no prejudice.
The Gibbses do not deny that the letter represented Suzanne Gibbs‘s purported status as legal representative of Christian, even though they contend it had no legal effect, nor do they dispute that Carnival relied on this letter in good faith. Carnival asserts that its reliance on the March 25, 1999 letter was to its detriment because “[h]ad Carnival known the true legal status of Suzanne Gibbs it could have taken appropriate steps to protect its inter
IV. Appointment of a Legal Representative
Having determined that the application of estoppel was inappropriate, we must now decide whether the District Court was nonetheless correct in dismissing Christian Gibbs‘s claims as time-barred according to the provision in the passenger ticket contract limiting the time to bring suit to one year.
A. The Meaning of 46 U.S.C. § 183b(c)
The Gibbses contend that the time-bar was not triggered because Christian Gibbs‘s complaint was filed within the safe-harbor of
If a person who is entitled to recover on any such claim is a minor... any lawful limitation of time prescribed in such contract shall not be applicable so long as no legal representative has been appointed for such... minor... but shall be applicable from the date of the appointment of such legal representative: Provided, however, that such appointment be made within three years after the date of such death or injury.
The statute does not specify the process by which a “legal representative” is appointed. Carnival contends that this appointment occurred on or about March 25, 1999, when the Gibbses retained counsel and notified Carnival that Suzanne Gibbs was appointed guardian ad litem for Christian. The Gibbses respond that under
While the New Jersey Court Rule is relevant to our inquiry and will be discussed further in the next section, we do not begin our analysis with this Court Rule. Instead, we must look to
B. Fed.R.Civ.P. 17
Whenever an infant or incompetent person has a representative, such as a general guardian, committee, conservator, or other like fiduciary, the representative may sue or defend on behalf of the infant or incomрetent person. An infant or incompetent person who does not have a duly appointed representative may sue by a next friend or by a guardian ad litem. The court shall appoint a guardian ad litem for an infant or incompetent person not otherwise represented in an action or shall make such other order as it seems proper for the protection of the infant or incompetent person.
Fed.R.Civ.P. 17(c) (emphasis added).
Under this two-step process, a federal court must first determine whether the infant has a “duly appointed representative” who has the capacity to bring the action оn behalf of the infant. McSparran v. Weist, 402 F.2d 867, 869 (3d Cir.1968).
Next we look to
In their complaint before the District Court, the Gibbses specified that Christian Gibbs is to be represented by Suzanne Gibbs as his guardian ad litem. There appears to be no conflict of interest between Suzanne Gibbs and her son, nor any other reason why she might not рrotect Christian‘s interests. Therefore, we detect no reason to suggest that the District Court should not have accepted the appointment of Suzanne Gibbs as guardian ad litem for Christian in this action. Because no legal representative for Christian Gibbs had been appointed until the Gibbses commenced the instant action before the District Court, where a legal representative was first appointed for Christian, we hold that his claims against Carnival are not time-barred under the special tolling provisions for minors in
V. Conclusion
We will therefore affirm the District Court‘s order dismissing Suzanne and Richard Gibbs‘s individual claims, but will vacate the Cоurt‘s order dismissing Christian Gibbs‘s claims and remand for further proceedings consistent with this opinion.2 Parties to bear their own costs.
Donna S. MARIE, (a fictitious name of a real individual), individually, on her own behalf, and on behalf of all women similarly situated; Donna Santa Marie, on behalf of her own child and all others similarly situated; Teresa H. Jimenez, on behalf of herself and on behalf of her patients [both moth-