John Cassedy Urges Congress To Stem Tide Of Soaring Liability Awards To Seamen

Calling upon Congress to enact a "good and fair" Seamen's Compensation Act in 1979 to help stem the tide of soaring liability awards to seamen, John H. Cassedy, president of the Shipowners Claims Bureau and secretary of the American Club (The American Steamship Owners Mutual Protection & Indemnity Association), urged shipowners to support such legislation as a "step toward putting American ships on a competitive basis with the foreign-flag owner." Speaking before the 52nd Annual Propeller Club National Convention in Honolulu, Mr.

Cassedy explained that because most foreignflag owners are covered by national compensation laws that protect seamen in their employ in case of injury or death, liability crew claims represent only about 11 percent of their total Protection and Indemnity insurance premiums. This puts U.S. shipowners at a competitive disadvantage because P&I insurance is one of the most expensive items in their insurance budgets, since crew claims represent close to 70 percent of their total P&I premiums. Thanks to the Merchant Marine Act of 1920, better known as the Jones Act, which gives the American seaman—as a ward of the court—the right to sue his employer directly if his injury is the result of unseaworthiness or negligence on the part of the shipowner, insurance costs are spiraling upward as juries award huge settlements to claimants, Mr. Cassedy said.

In emphasizing the need for Congress to pass a Seamen's Compensation Act next year, Mr. Cassedy warned that U.S. shipowners will continue to find it difficult to compete with foreign flags in terms of crew injury claims because, "I cannot see our courts reversing themselves (on) shipowners' liability, and I cannot see our juries cutting back on the amounts awarded seamen today." Mr. Cassedy agreed that there was a definite need for a Merchant Marine Act in the 1920s to protect seamen against serious social abuses, but said that today the American seaman is one of the highest paid in the world, with "as good, if not better, employment conditions than most Americans." Even so, the obsolescent legislation is still in effect.

As an example, he cited the case of a seaman who broke his leg jumping from the window of a house of ill repute. Although he was miles from his ship, as a ward of the court he sued the shipowner directly for maintenance— and the court found in his favor on the grounds that he was injured "while in the service of the ship." Insisting that the owner of an Americanflag vessel "has the cards stacked against him" regarding liability for crew injury claims, Mr. Cassedy told of a seaman who slipped on the deck of an American-flag ship and injured his back. His attorney sued the shipowner for $255,000 on the grounds of unseaworthiness. He was willing, according to Mr. Cassedy, to settle out of court for $60,000 but the shipowner's side felt that at best the case had a settlement value of $25,000. The case went to court, and five years after the accident the jury handed down a verdict awarding the seaman $205, 494. Thus, "The American-flag owner thinks long and hard before he decides to step on the scales of American justice," Mr. Cassedy said.

Continuing, Mr. Cassedy also described how another seaman slipped on a dock near to his ship. To break his fall, he instinctively put up his hand and it hit a moving electrical exhaust fan, immediately amputating the thumb and two fingers of his hand. He sued the ship for $5,000,000, and after two years the case was settled for $600,000. The shipowner's lawyers called it a "bargain" because if the case had gone to court, the probability was that the jury, said Mr. Cassedy, would award him between $800,000 and $950,000.

Mr. Cassedy emphasized that a fair compensation act would protect all seamen, regardless of who is at fault, and further noted that the seaman would benefit by receiving payment almost at once instead of waiting years, and that he would be keeping 100 percent of the award by not sharing it with a lawyer. In appealing to Congress to act upon national compensation, Mr. Cassedy also urged the merchant marine to choose a road toward "survival, growth and true competitiveness" by helping to eliminate the seaman's right, as,a ward of the court, to sue his employer.

Other stories from December 1978 issue


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