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Abbot v. Alaska Division of Marine Highway System, Inc. (5/14/99), 979 P 2d 994
Notice: This opinion is subject to correction before publication in
the Pacific Reporter. Readers are requested to bring errors to the attention of
the Clerk of the Appellate Courts, 303 K Street, Anchorage, Alaska 99501, phone
(907) 264-0608, fax (907) 264-0878.
THE SUPREME COURT OF THE STATE OF ALASKA
NANCY ABBOTT, )
) Supreme Court No. S-7390
Appellant, )
) Superior Court No.
v. ) 1JU-94-1187 CI
)
STATE OF ALASKA and DIVISION ) O P I N I O N
OF MARINE HIGHWAY SYSTEM, )
INC., ) [No. 5115 - May 14, 1999]
)
Appellees. )
______________________________)
Appeal from the Superior Court of the State of
Alaska, First Judicial District, Juneau,
Larry R. Weeks, Judge.
Appearances: Eric Dickman, Seattle,
Washington, for Appellant. Thomas J. Slagle, Assistant Attorney
General, and Bruce M. Botelho, Attorney General, Juneau, for
Appellees.
Before: Compton, Chief Justice, Matthews,
Eastaugh, and Fabe, Justices. [Bryner,
Justice, not participating.]
EASTAUGH, Justice.
I. INTRODUCTION
This appeal raises questions about the timeliness of
maritime claims filed by Nancy Abbott against her employer, the
Alaska Marine Highway System (AMHS), nearly five years after she
suffered a work-related injury. The superior court held that the
three-year limitations statutes barred her claims. But Abbott's
delay in suing was due to her reliance upon a contractual provision
which limited her to workers' compensation for work-related
injuries. She sued within a reasonable period after learning that,
in an appeal not involving Abbott, we had declared that contractual
provision illegal and unenforceable. We therefore conclude that
the statutes of limitations were equitably tolled and that Abbott's
maritime claims are not time barred. We reverse and remand.
II. FACTS AND PROCEEDINGS
Abbott suffered burns while working as a cook aboard
AMHS's M/V Aurora on April 23, 1988, when a deep fat fryer blew hot
grease on her face and ear. She also allegedly suffered
psychological injuries that have prevented her from working as a
chief cook.
Abbott was off work until May 8. She was released to
work beginning May 9. She received workers' compensation benefits
in accordance with the collective bargaining agreement (CBA)
between AMHS and her union, the Inlandboatmen's Union (IBU).
Abbott's workers' compensation coverage also paid for counseling.
On October 3, 1988, AMHS controverted "all medical and disability
benefits associated with claimant's current, past or present
psychological problems as a result of 4/23/88 work injury."
The then-current CBA conferred workers' compensation
benefits for injured AMHS sailors in lieu of the maritime remedies
provided by the Jones Act, 46 U.S.C. app. sec. 688 (1987), and
general maritime law. Section 9.01 of the CBA provided that "[i]n
lieu of
Wages, Maintenance and Cure, remedies for unseaworthiness and other
seamen's remedies, including Jones Act remedies, employees shall be
entitled to Alaska Workers' Compensation Benefits."
In August 1991 we decided Brown v. State. [Fn. 1] We
there held that a similar provision in another CBA, which also
conferred workers' compensation benefits in lieu of traditional
maritime remedies, violated the Federal Employers' Liability Act
(FELA), [Fn. 2] by impermissibly limiting the shipowner's liability
under the Jones Act. [Fn. 3] Following federal precedent, we also
held that the "swap"provision in Brown's CBA violated the rights
of seamen to recover under the maritime doctrines of
unseaworthiness and maintenance and cure, and that these rights
could not be modified by contract. [Fn. 4] Brown thus effectively
prevented the State from enforcing section 9.01 of the AMHS-IBU CBA
in effect when Abbott was injured.
About five months after we issued the Brown opinion, the
AMHS claims adjuster sent Abbott a form letter dated January 30,
1992. It told her of the holding in Brown (without giving that
decision's name or citation); it also informed her that she was no
longer covered by workers' compensation, but instead could avail
herself of the traditional maritime remedies if she was injured
while working aboard a vessel in navigation. Brown identified
three important rights available to injured sailors: "the
maritime-law right to maintenance and cure, the maritime-law right
to recover damages for injuries caused by the unseaworthiness of
the vessel, and the Jones Act right to recover damages caused by an
employer's negligence."[Fn. 5] We will sometimes refer to these
three rights as "traditional maritime remedies."
Abbott claimed that she first learned of the possibility
of pursuing traditional maritime remedies when she received the
adjuster's letter on February 1 or 2, 1992. On February 4, 1993,
nearly five years after she was injured, and a few days more than
one year after she received the adjuster's letter, Abbott filed a
complaint against the State and AMHS (collectively the State) in
superior court. The complaint asserted claims for the traditional
maritime remedies.
The State moved for summary judgment, contending that
Abbott's claims were time-barred by the three-year statutes of
limitations for maritime remedies. The superior court granted the
motion. It held that the statutes of limitations barred Abbott's
Jones Act and unseaworthiness claims and that laches barred her
maintenance and cure claim. It also held that equitable tolling
was not appropriate because Abbott "[did] not provide an adequate
explanation why suit was not filed until nearly a year and a half
after the Brown v. State decision." It also awarded attorney's
fees and costs to the State.
Abbott appeals from the summary judgment and the
attorney's fees award.
III. DISCUSSION
A. The Federal Maritime Statutes of Limitations Should be
Tolled.
The issue before us is whether the federal statutes of
limitations, which apply to Abbott's maritime claims against the
State, should be tolled. This issue presents a question of law, to
which we apply our independent judgment. [Fn. 6]
The parties agree, and we do not question, that Abbott is
a seaman. As such, her claims arise under federal maritime law.
Her negligence claim against the State is governed by the Jones
Act. [Fn. 7] It is well settled that the rights of Jones Act
seamen against their employers are fixed by the rules set forth in
the FELA; [Fn. 8] the FELA's three-year limitation period applies
to injured seamen who file negligence claims. [Fn. 9] Abbott's
unseaworthiness claim is governed by the Uniform Statute of
Limitations for Maritime Torts; that statute's three-year
limitations period applies to injured seamen who file
unseaworthiness claims. [Fn. 10] Although there is some question
whether the Uniform Statute of Limitations for Maritime Torts or
the doctrine of laches [Fn. 11] determines the timeliness of her
maintenance and cure claim, [Fn. 12] we need not resolve that
question. As the superior court noted, the three-year limitations
period would guide us even if we were to apply a laches analysis to
Abbott's maintenance and cure claim. [Fn. 13]
Because Abbott was injured on April 23, 1988 and did not
file suit until almost five years later, her claims are time barred
unless the applicable federal statutes of limitations are tolled.
Invoking Alaska's equitable tolling doctrine as set forth in
Dayhoff v. Temsco Helicopters, Inc., [Fn. 14] Abbott concludes that
the federal limitations periods should be equitably tolled. The
State, relying on a combination of federal and Alaska state
precedent, disagrees with Abbott's conclusion.
As a threshold matter, we note that federal law, not
state law, governs the tolling issue. By enacting federal statutes
of limitations to govern maritime claims, Congress manifested a
desire to achieve uniformity in the treatment of maritime claims.
To allow the diverse laws of each state to determine when the
limitation period on a federal cause of action is tolled,
interrupted, or suspended would tend to defeat the congressional
policy of uniformity. Therefore, we apply federal law here. [Fn.
15]
Federal precedent permits equitable estoppel or equitable
circumstances to extend the three-year limitations period. Many
federal cases seem to merge these two doctrines. [Fn. 16] For
example, Seattle Audubon Society v. Robertson [Fn. 17] stated that
equitable tolling may be applied when plaintiffs are "prevented
from asserting their claims by some kind of wrongful conduct on the
part of the defendant."[Fn. 18] But it is only equitable
estoppel that requires wrongful conduct on the part of the
defendant, i.e., fraud or misrepresentation. [Fn. 19] The federal
equitable tolling doctrine, on the other hand, does not require any
conduct by the defendant.
Abbott has not alleged fraud, misrepresentation, or
concealment, or other conduct sufficient to support a claim that
the State should be equitably estopped from invoking the three-year
limitations periods. We therefore only consider whether the
federal equitable tolling doctrine will permit Abbott to avoid the
bar of the statutes of limitations.
Federal precedent equitably tolls the limitations period
in three circumstances: (1) where the plaintiff has actively
pursued his or her judicial remedies by filing a timely but
defective pleading; [Fn. 20] (2) where extraordinary circumstances
outside the plaintiff's control make it impossible for the
plaintiff to timely assert his or her claim; [Fn. 21] or (3) where
the plaintiff, by exercising reasonable diligence, could not have
discovered essential information bearing on his or her claim. [Fn.
22] We conclude that Abbott's case falls most comfortably into the
third category.
Abbott's CBA provided that injured employees were
entitled to workers' compensation benefits in lieu of traditional
maritime remedies. In her declaration, Abbott stated that until
she received the adjuster's letter she "relied on what the State
told [her], that is, that [her] only remedy or claim against the
State was under Alaska Workers' Compensation." She asserted that
the letter gave her the first notice that she had any other
possible remedy, and that, after receiving the letter, she spoke
with her union, which referred her to Washington attorney Brad
Doyle, who first informed her of the Brown opinion. She further
declared that, before she spoke with attorney Doyle, she had
consulted other attorneys regarding other work-related injuries,
and that none of the other attorneys had ever advised her that she
had any remedies other than workers' compensation. Likewise, she
asserted that her union did not advise her that she had a remedy
other than workers' compensation until after she received the
State's 1992 letter. Based on these declarations we conclude that
Abbott could not have reasonably discovered that she had a remedy
other than workers' compensation until the 1992 letter arrived.
[Fn. 23]
Because tolling is an equitable doctrine which applies
when both parties are innocent of wrongdoing, equity requires that
we also consider whether its application will unjustly prejudice
the defendant. [Fn. 24] We conclude that it will not. Abbott's
workers' compensation injury report gave the State notice of her
injury and claims.
The State argues that it is "naturally prejudiced"by the
delay. Its generic statement is not sufficient to establish
prejudice. It has not argued that Abbott's supervisor or coworkers
(or other potential witnesses) are unavailable; that it can no
longer determine which fryer Abbott was using or whether it
malfunctioned; or that it no longer has records regarding the
condition of the fryer or instructions for its use. Nor has it
explained what possible additional prejudice occurred after the
State gave Abbott notice that she might have maritime remedies.
We also note that the State had ample incentive to
investigate the accident thoroughly even if it had no reason to
anticipate that Abbott might pursue maritime remedies. First, a
workers' compensation claim can lead to subrogated claims against
the manufacturer or servicer of an appliance. Second, an interest
in preventing similar injuries to other employees should have
encouraged AMHS to investigate the accident and inspect the fryer
after Abbott reported the accident.
We therefore conclude that equitable tolling in this case
will not cause unjust prejudice to the State.
B. Calculation of the Period of Tolling
The federal cases suggest two methods of applying the
equitable tolling doctrine. The "suspension approach"suspends the
statute of limitations during the period in which conditions that
justified the tolling were in existence. [Fn. 25] Alternatively,
the "reasonable time approach"tacks on extra time after the
statutory limitations period has run if the plaintiff needs it.
[Fn. 26] Under this approach, the plaintiff must file suit within
a reasonable time after the abatement of the circumstances which
justify the tolling. [Fn. 27] But we need not choose between the
two federal approaches to resolve this case because Abbott's claims
are timely under either method.
Because the CBA was in effect when Abbott was injured,
the suspension approach would give her the entire three-year
limitations period in which to file her complaint for her
traditional maritime remedies. The limitations period would start
running when Abbott first learned or could have of learned that she
could pursue those claims. As we concluded in Part III.A, Abbott
first reasonably could have learned that she could pursue federal
maritime claims when the adjuster's letter arrived. Abbott filed
suit on February 4, 1993, well within three years of receiving the
letter. Therefore, her federal maritime claims are timely under
the suspension approach.
We also conclude, as a matter of law, that Abbott filed
suit within a reasonable period of time after she learned or could
have learned that she could sue. Again, the pertinent interval is
the time between the date the adjuster's letter arrived and the
date Abbott filed suit. Abbott's delay of just over one year was
reasonable. The 1992 letter did not fully explain how the Brown
decision might affect Abbott. It simply informed her that she
might have maritime remedies which her CBA had expressly denied
her. The letter did not state that she might be entitled to pursue
those remedies with respect to her April 23, 1988 injury. It did
not mention that injury. It also noted that claims for negligence
and unseaworthiness required proof that the State was negligent or
the vessel was unseaworthy, and that her negligence would diminish
her recovery.
It was reasonable for Abbott to confer with her union and
knowledgeable counsel about these newly revealed possible remedies.
It was also reasonable to evaluate liability, comparative
negligence, and damages issues before filing suit. It was also
reasonable for her to consider whether, as the State's letter
intimated, sailors might be better off keeping the workers'
compensation benefits they had received than pursuing maritime
claims. Under these circumstances, Abbott did not act unreasonably
or in bad faith by not filing suit before February 4, 1993.
Considering that the applicable statutory limitations
periods are three years, that Abbott diligently and promptly
pursued her workers' compensation remedy after she was injured,
that she reasonably believed until 1992 that workers' compensation
was her only remedy, and that the adjuster's 1992 letter required
her to reassess the remedies available to her and to confer with
counsel, we are unwilling to say that a post-notice delay of one
year and a few days is unreasonable under the "reasonable time"
approach.
We therefore conclude that Abbott's maritime claims are
timely under both the suspension approach and the reasonable time
approach.
We decline to decide which approach a federal court would
apply to Abbott's case, because the choice of approaches is a
matter of federal law, the choice is not dispositive in this case,
and the parties have not squarely argued the issue in their briefs.
C. Attorney's Fees
Because we reverse the judgment against her, the award of
attorney's fees against Abbott must be vacated.
IV. CONCLUSION
Because the three-year maritime statutes of limitations
were equitably tolled, Abbott's February 1993 lawsuit was timely.
We therefore REVERSE and REMAND.
FOOTNOTES
Footnote 1:
816 P.2d 1368 (Alaska 1991).
Footnote 2:
45 U.S.C. sec. 51-60 (1988). Section 5 of the FELA prohibits
"[a]ny contract . . . the purpose or intent of which shall be to
enable any common carrier to exempt itself from any liability
created by this chapter." 45 U.S.C. sec. 55.
Footnote 3:
See Brown, 816 P.2d at 1375.
Footnote 4:
Id. at 1374-75.
Footnote 5:
Id. at 1371.
Footnote 6:
See Langdon v. Champion, 752 P.2d 999, 1001 (Alaska 1988)
("The standard of review on issues of law is de novo or independent
judgment."); Gudenau & Co. v. Sweeney Ins., Inc., 736 P.2d 763,
766-67 (Alaska 1987) (reviewing de novo superior court's
computation of limitations period).
Footnote 7:
See 46 U.S.C. app. sec. 688.
Footnote 8:
See id.; see also American Dredging Co. v. Miller, 510 U.S.
443, 455-56 (1994); Kernan v. American Dredging Co., 355 U.S. 426,
439 (1958); Lies v. Farrell Lines Inc., 641 F.2d 765, 770 (9th Cir.
1981).
Footnote 9:
See 45 U.S.C. sec. 56.
Footnote 10:
See 46 U.S.C. app. sec. 763a (1987).
Footnote 11:
Laches is "neglect to assert a right or claim which, taken
together with lapse of time and other circumstances causing
prejudice to the adverse party, operates as bar in court of
equity." Black's Law Dictionary 875 (6th ed. 1990).
Footnote 12:
See Ferris v. Veco Inc., 896 F. Supp. 966, 966 n.1 (D. Alaska
1995) ("It appears that the Ninth Circuit, when and if it decides
this issue in a published opinion, will conclude that [a
maintenance and cure claim] is analogous to a maritime tort and
therefore covered by the limitation period [in section 763a].")
(citing Usher v. M/V Ocean Wave, 27 F.3d 370 (9th Cir. 1994));
McKinney v. Waterman S.S. Corp., 739 F. Supp. 678, 681 (D. Mass.
1990), aff'd, 925 F.2d 1 (1st Cir. 1991) (concluding that, although
section 763a does not expressly apply to maintenance and cure
claims, "the three-year limitation period of Section 763a [should
be] used as a standard to determine the allocation of burdens in
connection with a laches defense"); Reed v. American S.S. Co., 682
F. Supp. 333, 336-38 (E.D. Mich. 1988) (applying laches to
maintenance and cure claim, and using six-year statute of
limitations for contracts to determine timeliness, because claim
was for unearned wages).
Footnote 13:
See McKinney, 739 F. Supp. at 681.
Footnote 14:
772 P.2d 1085, 1087 (Alaska 1989).
Footnote 15:
See Burnett v. New York Central R.R. Co., 380 U.S. 424, 435
(1965) (refusing to apply state savings statute to toll federal
statute of limitations under FELA and instead fashioning federal
rule to preserve congressional policy of uniformity underlying FELA
statute); Prejean v. Industrial Cleanup, Inc., 721 So. 2d 1273,
1275 (La. 1998) ("Where suit is begun in a state court on a
federally created cause of action and there is a federal period of
limitations applicable, state courts uniformly apply the federal
period and, if they exist, the federal rules on tolling and other
ancillary matters."); J.P. Ludington, Annotation, Accrual of Cause
of Action & Tolling of Limitation Period of sec. 6 of the Federal
Employers' Liability Act, 16 A.L.R. 3d 637, 646 (1967) ("Federal
rather than state law applies in deciding questions as to the
tolling of the limitation provision of [FELA].").
Footnote 16:
See Cada v. Baxter Healthcare Corp., 920 F.2d 446, 452 (7th
Cir. 1990) (noting that many cases "fuse the two doctrines"); see,
e.g., Alvarez-Machain v. United States, 107 F.3d 696, 701 (9th Cir.
1996); Walck v. Discavage, 741 F. Supp. 88, 91 (E.D. Pa. 1990)
(stating that equitable tolling may be appropriate if "the
defendant has actively misled the plaintiff").
Footnote 17:
931 F.2d 590 (9th Cir. 1991), rev'd on other grounds, 503 U.S.
429 (1992).
Footnote 18:
Id. at 595.
Footnote 19:
See Thomas J. Schoenbaum, 1 Admiralty and Maritime Law sec. 6-
16,
at 295 (2d ed. 1994) ("What this means is that estoppel will save
the plaintiff's claim only where the facts show that he has been
induced or tricked by the defendant into letting the deadline
pass."); see also Glus v. Brooklyn Eastern Terminal, 359 U.S. 231
(1959) (holding that defendant may be equitably estopped from
asserting limitations defense under FELA); Cada, 920 F.2d at 450
("[E]quitable estoppel comes into play if the defendant takes
active steps to prevent the plaintiff from suing in time.").
Footnote 20:
See Burnett, 380 U.S. at 30.
Footnote 21:
See Hanger v. Abbott, 73 U.S. (6 Wall.) 532, 542 (1867)
(equitably tolling statute of limitations on breach of contract
claim because courts in southern states closed during Civil War);
Seattle Audubon, 931 F.2d at 595-96 (equitably tolling fifteen-day
limitations period because unconstitutional statute and district
court's erroneous upholding of that statute barred plaintiffs from
filing claims which they sought to litigate); Osbourne v. United
States, 164 F.2d 767, 768-69 (2d Cir. 1947) (equitably tolling
maritime statute of limitations because plaintiff held in Japan
during Second World War was unable to file timely claim in court).
Footnote 22:
See Cada, 920 F.2d at 452.
Footnote 23:
The State argues that Abbott's two unsworn "declarations"are
not admissible evidence cognizable under Alaska Civil Rule 56(e).
We need not consider this argument, because the State did not
attack the declarations on that ground in the superior court. See
Zeman v. Lufthansa German Airlines, 699 P.2d 1274, 1280 (Alaska
1985).
Footnote 24:
See Seattle Audubon, 931 F.2d at 597-98 (considering whether
equitable tolling of statute of limitations would unjustly
prejudice defendant).
Footnote 25:
See, e.g., Burnett, 380 U.S. at 434-36; Billings v. Chicago,
Rock Island and Pac. R.R. Co., 581 F.3d 707, 710 (8th Cir. 1978).
Footnote 26:
Cada, 920 F.2d at 452.
Footnote 27:
See id. at 453.
