Terry P. MURPHY, Steven A. Murphy, as co-personal representatives of the Estate of Brendan M. Murphy, and as parents and natural guardians of Steven A. Murphy, Jr., a minor, Plaintiffs,
v.
FLORIDA KEYS ELECTRIC COOPERATIVE ASSOCIATION, INC., Defendant-Third-Party-Plaintiff-Counter-Defendant-Appellant,
v.
Raymond Ashman, III, Individually and as parent and natural guardian, of Raymond Ashman, IV, a minor child, Third-Party-Defendant-Counter-Claimant-Appellee,
Steven A. Murphy, Sr., et al., Third-Party-Defendants.
No. 02-11574.
United States Court of Appeals, Eleventh Circuit.
May 9, 2003.
David P. Karcher, Underwood, Karcher & Karcher, P.A., Miami, FL, Michael John McHale, Jensen Beach, FL, Robert E. Geisler, Peterson, Bernard, Vandenberg, Zei, Geisler & Martin, West Pаlm Beach, FL, for Florida Keys Elec. Co-op. Ass'n, Inc.
Joel D. Eaton, Podhurst, Orseck, Josefsberg, Eaton, Meadow, Olin & Perwin, P.A., for Ashman.
Appeal from the United States District Court for the Southern District of Florida.
Before BIRCH, CARNES and BRUNETTI*, Circuit Judges.
CARNES, Circuit Judge:
The issue in this appeal is whether the defendant in an admiralty tort1 action who settles with the plaintiff without obtaining a release from liability for other potential defendants can then be entitled to contribution from them toward the amount it paid to settle its own liability. Putting the Supreme Court's decision in McDermott, Inc. v. AmClyde,
That is the simple bottom line of our decision, and it is a result that makes good sense, but how our circuit law has gotten to that point is anything but simple. Instead of following a straight path our decisions on contribution in admiralty cases have lurched back and forth like a drunken sailor. Aftеr we set out the facts and procedural history, we will explain the proportionate share approach to apportioning liability among joint tortfeasors and why contribution is not available from nonsettling tortfeasors under that approach, and then explain why we conclude that our Jovovich decision is once again good law. There is also an issue in this case about the district court's dismissal of a counterclaim brought under the supplemental jurisdiction of the court, which we will take care of at the end of the opinion.
The facts leading up to these legal issues began shortly after midnight on July 25, 2000, when Raymond Ashman IV and two of his friends went out in a boat owned by his father, Raymond Ashman III, to enjoy the start of the annual "Sportsmen's Lobster Mini-Season." Raymond Ashman IV was piloting the boat. His two friends along for the ride were Brendan and Steven Murphy, who were brothers. The trio's trip ended in tragedy soon after it began when thе boat collided with an "electrical pole abutment support structure" owned by Florida Keys Electric Co-op Association, Inc. Brendan Murphy was thrown from the boat and killed, and his brother Steven was injured. Raymond Ashman IV was also injured.
Brendan and Steven's parents, the Murphys, sued Florida Keys in federal district court for the wrongful death of Brendan and for Steven's injuries.2 Their complaint invoked the court's admiralty jurisdiction. The Murphys did not sue any member of the Ashman family, and still have not done so. In response to the Murphy's complaint against it, however, Florida Keys filed a third-party complaint against the Ashmans3 which also invoked the district court's admiralty jurisdiction. Florida Keys claimed that, if it were found liable to the Murphys, it was entitled to contribution from the Ashmans. The Ashmans, for their part, filed a counterclaim against Florida Keys to recover for Raymond IV's injuries, but they brought that as a civil action under the district court's supplemental jurisdiction, not under its admiralty jurisdiction. They later brought a separate suit against Florida Keys in state court to recover for Raymond IV's injuries.
While all of the actions were pending, Florida Keys settled with the Murphys. The settlement agreement, however, did not release the Ashmans from liability to the Murphys, should the Murphys ever bring suit against them. As a result, the Ashmans moved for summary judgment on Florida Keys' third party contribution claim, taking the position that Florida Keys' failure to obtain a release for them as part of the settlement agreement barred it from seeking contribution from them. The district court agreed and granted the Ashmans' motion for summary judgment. The court also exercised its discretionary powers under 28 U.S.C. § 1367(c)(3) and dismissed without prejudice the Ashman' counterclaim against Florida Keys. Florida Keys appeals both the grant of summary judgment on its contribution claim against the Ashmans and the dismissal without prejudice of their counterclaim against it.4
DISCUSSION
In 1994 the Supreme Court settled decades of debate over the proper method of apportioning liability between settling and nonsettling tortfeasors in admiralty cases by holding that the "proportionate share approach" applies. See McDermott,
Allowing Florida Keys to recover contribution from the Ashmans in these circumstances is incompatible with the proportionate share approach. An essential tenet of this approach is that when a tortfeasor settles a claim against it, but does not obtain a release for the other tortfeasors, it has settled only its proportionate share of the total damages, no more and no less. It follows that what remains, and all that remains, to be calculated is the compensation the nonsettling tortfeasors owe the plaintiff. Once that amount is determined at trial, the nonsettling tortfeasors are liable only to the plaintiff and only to the extent the trial verdict determines. Their trial-determined liability is in no way affected by a settling defendant's negotiated liability. See id. at 220,
Applying the proportionate share approach to this case, Florida Keys resolved through the settlement only the amount of damages it owed to the Murphys. The settlement determined between those two parties the amount of damages the Murphys suffered and Florida Keys' percentage of fault. There is nothing about the issue of how muсh Florida Keys should have paid the Murphys that is to be litigated between Florida Keys and the Ashmans, because under the proportionate share approach it does not matter to the Ashmans how much Florida Keys should have paid the Murphys to discharge its liability to them. That is Florida Keys' business, not a matter of concern for the Ashmans.
To come at the same thing another way, when Florida Keys and the Murphys negotiated their settlement, they each assumed the risk of misjudging what a trial would determine to be the amount of damage the Murphys had suffered and the proportion of the liability for that damage that should be attributed to Florida Keys instead of the Ashmans.5 The Ashmans, who were not a party to the settlement, assumed no such risk, preferring instead to risk whatever verdict the Murphys might obtain against them, perhaps discounted by the hope or expectation that the Murphys would not sue them. If the Murphys got more from settling with Florida Keys thаn they would have recovered from taking Florida Keys to trial, that does not lessen the potential liability of the Ashmans. See Id. at 219-20,
There are two ways to look at what Florida Keys is seeking to do, and both are telling. One way is that Florida Keys is seeking to escape the bargain it struck with the Murphys about the extent of its liability, trying to litigate with the Ashmans the issue of how much it should have paid the Murphys and then recover from the Ashmans any excess it did pay. That will not dо, because the Ashmans are not responsible for the bargain Florida Keys struck with the Murphys. The other way to look at Florida Keys' position is that it is seeking to recover from the Ashmans the amount of the settlement it paid to the Murphys that is attributable to the Ashmans' liability. That will not do either, because none of the settlement is attributable to the Ashmans' liability, which was not released in whole or part. We hold Florida Keys to its bargain: it paid for a discharge of its liability to thе Murphys, and that is all it got.
We have reached the identical conclusion once before. See Jovovich v. Desco Marine, Inc.,
Florida Keys says that we should not adhere to Jovovich, but should instead follow the later decision in Great Lakes Dredge & Dock Co. v. Tanker Robert Watt Miller,
Our predecessor circuit first confronted the overarching issue of the proper way to apportion liability between settling and nonsettling tortfeasors in admiralty cases in Loffland Brothers Co. v. Huckabee,
Twelve years later, though, the Fifth Circuit overruled Loffland and Billiot and held that the proportionate share approach applied to admiralty tort cases. Leger v. Drilling Well Control, Inc.,
The Supreme Court's Reliable Transfer decision did not involve multiple defendants, one of whom had settled with the plaintiff. Nonetheless, the Fifth Circuit concluded in Leger that the rule adopted in Reliable Transfer undermined the pro tanto apprоach the circuit had been following to such an extent that it overruled Loffland and Billiot and adopted the proportionate share approach instead. Leger,
The proportionate share approach from Leger became part of the law of this circuit with this Court's decision in Bonner v. City of Prichard,
Shortly after Jovovich was released, however, this Court swerved back the other way, concluding in Self v. Great Lakes Dredge & Dock Co.,
Then came Great Lakes III in 1992, which held that under the pro tanto approach adopted in Great Lakes II, a suit for contribution against a nonsettling, unreleased defendant is available to a settling defendant, even though under Jovovich such a suit is not available under the proportionate share approach. Great Lakes III,
In 1994 the Supreme Court resolved the issue of how liability between settling and nonsettling tortfeasors in admiralty cases should be apportioned, rejecting the pro tanto approach in favor of the proportionate share approach. See McDermott,
Now this circuit (along with the rest of the country) is operating under the proportionate share approach in admiralty tort cases, see McDermott,
Great Lakes III is no longer relevant, at least not in admiralty tort cases. It addressed nothing other than contribution rights under a pro tanto approach to apportioning liability. The pro tanto approach to apportioning liability is no longer the law in admiralty tort cases. See Smith v. GTE Corp.,
Florida Keys says that the conclusion we reach will present parties who wish to settle with a Catch 22: either obtain a release for all parties and have contribution precluded by McDermott's rule barring contribution from settling parties,
One other issue remains to be decided. In addition to granting summary judgment in favor of the Ashmans on Florida Keys' contribution claim, the district court dismissed without prejudice the Ashmans' counterclaim against Florida Keys under 28 U.S.C. § 1367(c). That suited the Ashmans fine, but Florida Keys, apparently preferring to stay in federal court, argues that the Ashmans' counterclaim could only have been properly asserted under thе district court's admiralty jurisdiction, not its supplemental jurisdiction, and therefore dismissal under § 1367(c) was an abuse of discretion. We disagree with the initial premise of that argument.
The Ashmans originally could have brought their maritime tort claim against Florida Keys in one of two ways. They could have sued in state court, a right guaranteed them by the "savings to suitors" clause of 28 U.S.C. § 1333, or they could have sued in federal court by invoking the district court's admiralty jurisdiction.7 See, e.g., Cont'l Cas. Co. v. Canadian Universal Ins. Co.,
Florida Keys third-party complaint against the Ashmans thus left them with two options for federal court jurisdiction over their claim against Florida Keys. They could invoke the district court's admiralty jurisdiction, or they could bring their maritime tort claim as a civil action under the district court's supplemental jurisdiction as a compulsory counterclaim. If a claim has multiple jurisdictional bases, one of which is admiralty, Federal Rule of Civil Procedure 9(h) provides that the pleading "may contain a statement identifying the claim as an admiralty or maritime claim." Failure to identify a claim as an admiralty or maritime claim in these circumstances means that it is not one. See Fеd.R.Civ.P. 9(h), advisory committee notes (noting that the unification of admiralty and civil actions necessitated a procedural mechanism to preserve the "power of the pleader to determine whether these historically maritime procedures shall be applicable to his claim or not; the pleader must be afforded some means of designating his claim"); Romero v. Bethlehem Steel Corp.,
AFFIRMED.
Notes:
Notes
Honorable Melvin Brunetti, United States Circuit Judge for the Ninth Circuit, sitting by designation
We use the term "admiralty tort" in the first part of this opinion to mean a tort asserted under a federal court's admiralty jurisdiction. Later in the opinion, we use the term "maritime tort," which is a species of tort that can be brought under a federal court's admiralty jurisdiction, although it need not be
The Murphys sued as parents and natural guardians of Steven, a minor, аnd as co-personal representatives of the estate of Brendan
Florida Keys' third-party complaint is against Raymond Ashman III, the father of Raymond Ashman IV, individually, and also in his capacity as parent and natural guardian of his son. Our references hereafter in this opinion to "the Ashmans" mean Raymond III, individually, and Raymond IV through him as parent and natural guardian
Of course, parties ordinarily do not complain about the dismissal of a claim or counterclаim against them, but the dismissal without prejudice allowed the Ashmans to pursue their claim against Florida Keys in state court. Florida Keys' apparent motivation in appealing the dismissal is its preference for a federal court forum
Because of the multiple factors that must be taken into account when making settlement decisions, and because predicting the result of trials is not an exact science by any means, the settlement figure will rarely matсh what a trial would have determined to be actual damages owed the plaintiff by the settling defendantSee McDermott,
TheGreat Lakes litigation has come before this Court four times: Ebanks v. Great Lakes Dredge & Dock Co.,
There was no diversity of citizenship between the Ashmans and Florida Keys, so the Ashmans could not have brought their maritime tort claim as a civil action in federal court under the "savings to suitors" clauseSee Cont'l Cas. Co. v. Canadian Universal Ins. Co.,
