Federal Circuits, 1st Cir. (January 30, 1991)
Docket number: 90-1622
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U.S. Court of Appeals for the 2nd Cir. - Emil Aslanidis, Plaintiff-Appellant, v. United States Lines, Inc., United States Lines (S.A.), Inc., United States Lines, Inc., Reorganization Trust, United States Lines (S.A.), Inc., Reorganization Trust, Defendants-Appellees. Emil Aslanidis, Plaintiff-Appellant, v. Brandeis Intsel & Co., Inc., Brandeis Division of Pechiney World Trade Usa, Inc., John Doe I, John Doe Ii, John Doe Iii, Samancor, Ltd., South African Container Depots, Ltd. and Rennies Freight Services, Ltd., Defendants-Appellees. Brandeis Intsel & Co., Inc. and Brandeis Division of Pechiney World Trade Usa, Inc., Third-Party-Plaintiffs, v. Samancor, Ltd., South African Container Depots, Ltd. and Rennies Freight Services, Ltd., Third-Party-Defendants., 7 F.3d 1067 (2nd Cir. 1993) Plaintiff-Appellant, v. United States Lines, Inc., United States Lines (S.A.), Inc., United States Lines, Inc., Reorganization Trust, United States Lines (S.A.), Inc., Reorganization Trust, Defendants-Appellees. Emil Aslanidis, Plaintiff-Appellant, v. Brandeis Intsel & Co., Inc., Brandeis Division of Pechiney World Trade Usa, Inc., John Doe I, John Doe Ii, John Doe Iii, Samancor, Ltd., South African Container Depots, Ltd. and Rennies Freight Services, Ltd., Defendants-Appellees. Brandeis Intsel & Co., Inc. and Brandeis Division of Pechiney World Trade Usa, Inc., Third-Party-Plaintiffs, v. Samancor, Ltd., South African Container Depots, Ltd. and Rennies Freight Services, Ltd., Third-Party-Defendants.
Joseph M. Orlando with whom David C. Nunheimer and Orlando & Associates were on brief, for plaintiff, appellant.
Frank H. Handy, Jr., with whom Richard B. Kydd and Kneeland, Kydd & Handy were on brief, for defendant, appellee.Before CAMPBELL and TORRUELLA, Circuit Judges, and BOWNES, Senior Circuit Judge.LEVIN H. CAMPBELL, Circuit Judge.Appellant Lowell McKinney appeals from the dismissal of his action for personal injury against appellee Waterman Steamship Corp. ("Waterman") arising from an alleged accident that occurred at sea on board Waterman's ship, the S.S. Robert E. Lee. McKinney's complaint alleged Jones Act negligence, 46 U.S.C.App. Sec. 688 (1982), and unseaworthiness under general maritime law; it also sought maintenance and cure benefits. In dismissing McKinney's action, the district court held that the three-year statute of limitations barred the Jones Act and general maritime law claims, and that laches barred the maintenance and cure claim. 739 F.Supp. 678. We affirm.The district court's discussion of this case's extensive procedural history is comprehensive, and we need repeat only what is helpful to understand our discussion here. McKinney's injury occurred no later than on December 12, 1981.1 Almost two years thereafter, on December 1, 1983, Waterman petitioned for bankruptcy in the Southern District of New York under Chapter 11 of the Bankruptcy Code. The filing of this petition triggered the automatic stay provisions of 11 U.S.C. Sec . 362. A year later, on November 30, 1984, McKinney filed a complaint for personal injury against Waterman in the District Court for the Southern District of New York. The complaint in that case was virtually identical to the present one. When Waterman's counsel notified McKinney of the bankruptcy automatic stay, McKinney voluntarily dismissed the first complaint on May 23, 1985. McKinney then filed a claim in the bankruptcy case, and his attorney engaged in settlement negotiations with Waterman representatives. The bankruptcy stay was lifted no later than August 9, 1986, and McKinney filed the present complaint in the District of Massachusetts more than two years thereafter, on January 17, 1989. Not counting the time during which the bankruptcy stay prevented McKinney from suing, more than four years passed between McKinney's injury and the filing of the present complaint.The Limitations PeriodThe district court found, and we agree, that a three-year limitations period applies to McKinney's tort claims. As the court stated, "the source of the limitations period ultimately proves immaterial because ... all potential sources suggest three years as the relevant time-frame."2 We also agree that, for tolling purposes, "[b]ecause McKinney's injury was of the sort discovered immediately, his cause of action accrued when he was injured."The district court correctly concluded that the timeliness of the maintenance and cure claims depended upon equitable principles of laches, with the three-year limitations period providing a benchmark after which the bar of laches would presumptively apply unless plaintiff showed good reason to the contrary. See Clauson, 823 F.2d at 661 n. 1 (laches applies to maintenance and cure claims). In Puerto Rican-American Ins. v. Benjamin Shipping, 829 F.2d 281, 283 (1st Cir.1987), we noted that the district court, applying laches within its sound discretion, "must examine whether plaintiff's delay in bringing suit was unreasonable and whether defendant was prejudiced by the delay." 829 F.2d at 283. We further noted that if a plaintiff files a complaint within the analogous statutory period, the burden of proving unreasonable delay and prejudice falls on the defendant; thereafter, the burden shifts and laches is presumed unless disproven by plaintiff. Id. In determining the relevant analogous limitations period, the district court concluded that the federal uniform maritime tort limitations period, 46 U.S.C.App. Sec. 763a, was applicable. The court reasoned that where, as here, the maintenance and cure claim arises out of the same personal injury as the other tort counts, even though the source of the claim is contractual, the uniform period provides the appropriate benchmark for all aspects of the injury, including maintenance and cure. Cf. Aguilar v. Standard Oil Co. of New Jersey, 318 U.S. 724, 730, 63 S.Ct. 930, 933, 87 L.Ed. 1107 (1943) (maintenance and cure is an implied employment contract provision and is not predicated on fault or negligence); Butler v. American Trawler Co., Inc., 887 F.2d 20, 21 (1st Cir.1989) (Congress intended uniform maritime tort limitations period to preclude the operation of different state limitations statutes with respect to maritime torts). See generally, Barnes v. Andover Co., L.P., 900 F.2d 630, 633-37 (3d Cir.1990) (discussing history and character of maintenance and cure). The district court ruled, therefore, that the section 763a three-year statute of limitations was applicable to place the burden of proof upon McKinney to show that the delay was reasonable and did not prejudice Waterman.As the most analogous state statute of limitations period is also three years, we need not decide whether the district court properly selected the section 763a three-year limitations period as the relevant benchmark. Massachusetts law provides that a three-year limitations period applies to "actions of contract to recover for personal injuries." Mass.Gen.Laws Ann. ch. 260, Sec. 2A. While McKinney argues that the maintenance and cure claim is not governed by Section 763a, he concedes in his brief that a personal injury is "an obvious prerequisite of the claim" and suggests no other state law limitations reference period for purposes of allocating the burden of proof when applying laches principles. The present maintenance and cure claim, arising here out of a personal injury, fits within the Massachusetts limitations provision for a contract action to recover for personal injuries. There is no reason, therefore, to consider the applicability of the six-year Massachusetts limitations period for contract actions "other than those to recover for personal injuries." Mass.Gen.Laws Ann. ch. 260, Sec. 2 (1959).Application of the Limitations PeriodMcKinney's difficulty is that, after subtracting the full period that the automatic stay was in effect, his present suit was still not brought within three years. McKinney argues on appeal that he should receive an equitable extension of the statute of limitations and that, under the laches analysis relevant to his maintenance and cure claim, he did not unreasonably delay filing that claim. McKinney maintains that he did not "sleep on his rights," that his initial filing in the Southern District of New York put Waterman on notice of the lawsuit, and that Waterman was apprised of McKinney's continued pursuit of a remedy by means of McKinney's involvement in ongoing settlement negotiations. The linchpin of McKinney's arguments is his assertion that he did not receive notice that the bankruptcy stay was lifted. Consequently, he says he was unaware that he was free to refile his complaint until his suspicion was aroused long after the limitations period had elapsed. McKinney argues that Waterman, aware that the stay was lifted and of McKinney's unawareness of this fact during continuing settlement negotiations, should be estopped from asserting limitations defenses.However, McKinney filed no counteraffidavits or other evidence in the district court supporting the contentions in his appellate brief that he was without notice of the lifting of the automatic stay. To the contrary, such evidentiary materials as there are indicate that he did receive notice and that his attorney, at least, was well aware of the progress and termination of the bankruptcy proceedings. The record appendix on appeal, designated by appellant McKinney, includes Waterman's brief in reply to McKinney's opposition to the motion to dismiss, to which is attached an affidavit of mailing of the notice of the confirmation of the plan, dated July 17, 1986. The page of the mailing list attached to the affidavit of mailing specifies McKinney as a recipient of notice.While the confirmation of the Chapter 11 plan on June 19, 1986 did not mention release from the automatic stay specifically, an automatic stay under 11 U.S.C. Sec . 362(a) is normally lifted when the confirmation order is issued. Since confirmation revests the property of the estate in the debtor, (as well as discharging the debtor from all dischargeable pre-petition debts),3 the stay of an act against the property of the estate would no longer be applicable. See In re Turning Point Lounge, Ltd., 111 B.R. 44, 46 (Bankr.W.D.N.Y.1990) (automatic stay ceases to operate upon confirmation of Chapter 11 plan); In re Korgan, 52 B.R. 557 (Bankr.D.Or.1985) (automatic stay expired upon confirmation of Chapter 11 plan); In Re Paradise Valley Country Club, 31 B.R. 613, 615 (D.Colo.1983) ("Since confirmation of a Chapter 11 plan has the dual effect of revesting the debtor with title to its property and discharging the debtor from all dischargeable pre-petition debts, there can be no further application of the automatic stay subsequent to confirmation"); In re Thrush, 31 B.R. 106, 107 (Bankr.M.D.Pa.1983) (order granting relief from automatic stay lacked significance because six days later debtors were discharged and automatic stay was thereby lifted by operation of law).Moreover, the record appendix includes an affidavit of James P. Laughlin, (an attorney involved in representing Waterman in the bankruptcy proceedings), attached to Waterman's motion to dismiss McKinney's present complaint. Laughlin represents in this affidavit that Vincent Lipori, Esquire, of Carro, Spanbock, Fass, Geller, Kaster & Cuiffo, filed a proof of claim on behalf of McKinney in the bankruptcy proceedings. Laughlin also represents that McKinney appeared through counsel in the bankruptcy proceedings in connection with personal injury claimants' efforts to obtain relief from the automatic stay. In response to the claimants' efforts, the bankruptcy court issued an order on July 14, 1986 which purportedly would have the effect of vacating the automatic stay 15 days from the date of the order if Waterman failed to refile a 28 U.S.C. Sec . 157(b)(5) motion to transfer personal injury/wrongful death cases to the District Court for the Southern District of New York, originally filed in the bankruptcy court. As Waterman never refiled the Sec. 157(b)(5) motion, the automatic stay would have lapsed under the July 24, 1986 order on August 9, 1986.4The bankruptcy court order appears in the district court record and is also published. See In re Waterman S.S. Corp., 63 B.R. 435, 438 (Bankr.S.D.N.Y.1986). On its first page is a list of appearances, including that of Carro, Spanbock, by Vincent Lipari. It is a fair inference that all such listed counsel were notified of the bankruptcy court's order. Notice to an attorney is notice to the client. See Fed.R.Civ.P. 5(b); Irwin v. Veterans Administration, --- U.S. ----, 111 S.Ct. 453, 456, 112 L.Ed.2d 435 (1990).To be sure, the present action was dismissed by the district court on a motion to dismiss on the pleadings under Fed.R.Civ.P. 12(b)(6). While under Fed.R.Civ.P. 12(c) the district court may accept matters outside the pleadings and treat the motion as one for summary judgment, in such a case Rule 12(c) provides that "all parties shall be given reasonable opportunity to present all material made pertinent to such a motion by Rule 56." See Whiting v. Maiolini, 921 F.2d 5 (1st Cir.1990). There is no indication here that the parties were ever told in so many words that the court was proceeding under Rule 12(c). But this court has "treat[ed] any error in failing to give express notice as harmless when the opponent has received the affidavit and materials, has had an opportunity to respond to them, and has not controverted their accuracy." Id., quoting Moody v. Town of Weymouth, 805 F.2d 30, 31 (1st Cir.1986) (per curiam). See also Fudge v. Penthouse International, Ltd., 840 F.2d 1012, 1015 n. 1 (1st Cir.), cert. denied,Try vLex for FREE for 3 days
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