By the Admiralty and Maritime Team
In Atlantic Sounding Co., Inc., et al. v. Townsend, the United States Supreme Court held that punitive damages are available to a seaman if his employer/vessel owner has willfully failed to fulfill its maintenance and cure obligation. This decision effectively overrules recent United States Court of Appeals jurisprudence, such as Guevara v. Maritime Overseas Corp, 59 F.3d. 1496, 1995 AMC 2409 (5th Cir. 1995) and Glynn v. Roy Al Boat Management Corp., 57 F.3d 1495, 1995 AMC 2022 (9th Cir. 1995), which interpreted the prior Supreme Court case of Miles v. Apex Marine Corp., 498 U.S. 19, 1991 AMC 1 (1990) to bar claims for punitive damages against vessel owners for the willful failure to pay maintenance and cure.
The Plaintiff, Edgar Townsend, injured his arm and shoulder while working aboard a vessel owned by Atlantic Sounding. Atlantic Sounding advised Plaintiff that it would not provide him maintenance and cure. Townsend later filed suit alleging an arbitrary and willful failure by Atlantic Sounding to pay maintenance and cure. He also sought punitive damages for the denial of maintenance and cure. Atlantic Sounding moved to dismiss the punitive damage claim; however, the District Court denied the Motion, holding that punitive damages were available in an action for maintenance and cure. The United States Court of Appeals for the 11th Circuit concurred, and the Supreme Court upheld the decision of the 11th Circuit on June 25, 2009.
The Supreme Court based its decision on three legal principles: (1) punitive damages have long been available in common law; (2) the common law tradition of punitive damages extends to maritime claims; and (3) there is no evidence that claims for maintenance and cure are excluded from this general admiralty rule. The Court noted that Congress has not enacted legislation departing from the above common law principles. More importantly, the Jones Act, which provides a vehicle for an injured employee to sue his employer/vessel owner, did not eliminate punitive damages. Thus, the Court held that a seaman may advance a claim for punitive damages against his employer/vessel owner.
It is important to note that the Supreme Court did not decide whether Townsend was entitled to a punitive damage award; instead, the Court determined that he had the right to bring a punitive damage claim. Townsend must ultimately prove that Atlantic Soundings’ failure to pay maintenance and cure was willful and wanton to recover punitive damages.
It is likely that a seaman advancing a claim for punitive damages will be held to the same burden of proof that is necessary for an award of attorney’s fees in a maintenance and cure action. Attorney’s fees incurred by a plaintiff in prosecuting a claim for maintenance and cure may be awarded for the failure of an employer to properly investigate and pay maintenance and cure claims. Vaughan v. Atkinson, 369 U.S. 527, 1962 AMC 1131 (1962). Yet, an award of attorney’s fees for the failure to pay maintenance and cure is only appropriate under the most egregious circumstances. A vessel owner who acted reasonably in refusing to pay maintenance and cure is liable only for the amount of maintenance and cure he failed to pay.
However, if an employer/vessel owner lacks a reasonable defense to the payment of maintenance and cure and has exhibited callousness and indifference to the seaman’s plight, he is liable for attorney’s fees. As such, the award of attorney’s fees is proper only if the employer has been found to have acted in a fashion that is callous and recalcitrant, arbitrary and capricious or willful, callous and persistent in refusing to pay maintenance and cure. Morales v. Garijack, Inc., 829 F.2d 1355, 1358 (5th Cir. 1987). This is a high burden and can only be decided on a case by case basis.