Unpublished Disposition, 855 F.2d 861 (9th Cir. 1986)

MEMORANDUM^* 

Plaintiff-appellant Lasseigne & Sons, Inc. appeals from a district court's order awarding damages to claimants-appellees Warren E. Bacon, personal representative of the estate of Randy W. Bacon, and George Guinsbourg, personal representative of the estate of Jean Guinsbourg (collectively claimants). Lasseigne contends that the district court erred when it awarded, pursuant to the Jones Act, 46 U.S.C. § 688 (1982), $300,000 to each estate for the loss of Bacon and Guinsbourg's future earnings. Lasseigne argues that the court also erred when it awarded $25,000 to Bacon's parents and to Guinsbourg's father for the pecuniary loss they suffered as a result of their son's deaths. The claimants filed a cross-appeal arguing that if the court erred in awarding future earnings pursuant to the Jones Act, the court also erred when it held future earnings were not available pursuant to general federal maritime law.

We must answer the following questions:

1. Whether there was sufficient evidence to support the district court's award of $25,000 to the parents of Bacon and Guinsbourg for the loss of their support and services.

2. Whether, in a survival action, the Jones Act allows an award for a decedent's loss of future earnings.

3. Whether the district court erred when it failed to state in its opinion that it had discounted the damage awards to their present value.

4. Whether the district court chose the proper interest rate when it awarded prejudgment interest.

5. Whether the district court erred when it held that general federal maritime law did not allow an award for the loss of future earnings.

* PERTINENT FACTS AND PROCEEDINGS BELOW

On November 14, 1985, the F/V Lasseigne, owned and operated by Lasseigne & Sons, set out from Newport, Oregon for a fishing trip. On board were Kenneth Lasseigne, Bacon and Guinsbourg. On the morning of November 15, 1985, the F/V Lasseigne capsized and all three men on board died. At the time of the accident, Randy Bacon was 32 and Jean Guinsbourg was 36.

On April 23, 1986, Lasseigne & Sons filed a complaint in the United States District Court for the District of Oregon "seeking exoneration from or limitation of liability in accordance with 46 U.S.C. §§ 183-189, and Rule F of the Supplemental Rules for Certain Admiralty and Maritime Claims of the Federal Rules of Civil Procedure."

On May 15, 1986, Bacon's personal representative filed an answer to Lasseigne & Sons complaint and a claim, on behalf of Bacon's estate and parents, requesting damages pursuant to the Jones Act, the Death on the High Seas Act (DOHSA), 46 U.S.C. §§ 761 et seq. (1982), and general federal maritime law. On June 24, 1986, Guinsbourg's personal representative filed an answer and claim, on behalf of Guinsbourg's estate and father, also seeking damages under the Jones Act, DOHSA and general federal maritime law.¹ 

Pursuant to a stipulation by the parties, the case was tried to the court sitting without a jury in January, 1987. Following the trial the district court filed an opinion and ordered judgment for the claimants. The court found Lasseigne & Sons liable for the deaths of both Bacon and Guinsbourg. The court awarded, pursuant to the Jones Act, damages of $125,000 for pain and suffering to each estate. The court also awarded, under the Jones Act, $300,000 to each estate for the loss of future earnings. The court held that no damages could be awarded under general federal maritime law. Finally, the court awarded $25,000 under DOHSA to Bacon's parents and to Guinsbourg's father for the loss of their sons' support and services. Prejudgment interest was awarded at the rate of 9% per year.

Lasseigne & Sons appeals from the awards for loss of future earnings and loss of support and services. Lasseigne & Sons does not contest the finding of liability or the awards for pain and suffering. The claimants cross-appeal from the district court's ruling that the loss of future earnings is not compensable under general federal maritime law.

II

AWARD FOR LOSS OF SUPPORT AND SERVICES

In this action, the district court awarded $25,000 to the parents of Bacon and Guinsbourg "for the loss of support and services under DOHSA that would have accrued had they survived...." According to Lasseigne & Sons, the claimants failed to present evidence that Bacon's parents and Guinsbourg's father suffered a pecuniary loss when their sons died.

This court will reverse a district court's damage award only if it finds that the factual findings in support of the award are clearly erroneous. Bergen v. F/V St. Patrick, 816 F.2d 1345, 1350 (9th Cir. 1987). "A finding is 'clearly erroneous' when although there is evidence to support it, the reviewing court is left with the definite and firm conviction that a mistake has been committed." United States v. United States Gypsum, 333 U.S. 364, 395 (1948).

Death on the High Seas Act (DOHSA), 46 U.S.C. § 761 et seq. (1982), provides a wrongful death cause of action for the benefit of the decedent's surviving relatives. Section 761 provides:

Whenever the death of a person shall be caused by wrongful act, neglect, or default occurring on the high seas beyond a marine league from the shore of any State, or the District of Columbia, or the Territories or dependencies of the United States, the personal representative of the decedent may maintain a suit for damages in the district courts of the United States, in admiralty, for the exclusive benefit of the decedent's wife, husband, parent, child, or dependent relative against the vessel, person, or corporation which would have been liable if death had not ensued.

Section 762 provides for the amount of damages:

The recovery in such suit shall be a fair and just compensation for the pecuniary loss sustained by the persons for whose benefit the suit is brought and shall be apportioned among them by the court in proportion to the loss they may severally have suffered by reason of the death of the person by whose representative the suit is brought.

DOHSA provides a cause of action for pecuniary losses only. Bergen, 816 F.2d at 1347.

"Loss of support, services and inheritance are pecuniary damages under DOHSA." Id. at 1350. In Bergen, this court held that " [a]ny damage award must be proved and be reasonably certain." Id. Thus, "recovery for loss of support requires some showing of dependence on the deceased or an expectation of support. Damages for loss of services require proof that such services were expected and likely to be provided, but for the wrongful death." Id. In determining the amount of damages, although they " 'need not be proved to a mathematical certainty, "sufficient facts must be introduced so that a court can arrive at an intelligent estimate without speculation or conjecture." ' " Id. (quoting Harmsen v. Smith, 693 F.2d 932, 945 (9th Cir. 1982), cert. denied, 464 U.S. 822 (1983), in turn quoting Rochez Bros., Inc. v. Rhoades, 527 F.2d 891, 895 (3d Cir. 1975), cert. denied, 425 U.S. 993 (1976)). The courts factual findings "must be comprehensive enough to provide a basis of decision and must be fairly supported by the record." Id.

In Garnett v. Louisville & N. R.R., 235 U.S. 308, 313 (1914), the Supreme Court said, "Common experience teaches that financial damage to a parent by no means follows as a necessary consequence upon the death of an adult son." Because of this fact,

[c]ourts have listed a number of elements to be considered in awarding damages to parents for pecuniary loss resulting from the death of a child, including the deceased's age, health, and earning capacity, her surviving beneficiaries, their ages, health and financial condition, her contributions to them, and her relationship with them.

Dugas v. Nat'l Aircraft Corp., 438 F.2d 1386, 1392-93 (3d Cir. 1971). "When the beneficiaries are parents of an adult child, pecuniary loss must be alleged and proved." Cleveland Tankers v. Tierney, 169 F.2d 622, 624 (6th Cir. 1948). Past financial contributions are an important factor in determining an award for loss of support. Dugas, 438 F.2d at 1394 n. 19.

The claimants failed to satisfy their burden of presenting evidence to show dependence on, or expectation of, support from their sons. They also did not present sufficient evidence to establish that services were expected or likely to be provided in the future.

In awarding $25,000 to Bacon's parents, the court stated " [t]here was testimony at trial that Randy Bacon performed valuable services for his parents when he visited home. He promised to care for his parents in their old age." In an order denying a motion by Lasseigne & Sons to amend the court's opinion, the court said "there is evidence in the record to support an award for loss of services and support. Warren Bacon testified that his son, decedent Randy Bacon, promised to help his parents in their old age. He also testified about the substantial services Randy Bacon provided when he visited his parent." The court found Warren Bacon's testimony credible.

At trial, Warren Bacon testified that he was 67 and his wife was 61. He testified that he and his wife were retired and lived near Portland. He said that he had a pension. During the trial, Warren Bacon stated that Randy came home every once in a while to see how things were going. When he came home, Randy would usually spend two or three days. He always helped out when he came home--fixing insulation, painting window sills, doing yard work, working on the car. He always asked if anything needed to be done. The witness also testified that Randy would take his parents to any necessary doctor's appointments. Warren Bacon stated that when Randy came home they would discuss the future. He said Randy always said he would take care of both parents. He testified that Randy would say he was going to get some property on a river and build a house for his parents on one side and a house for himself and his wife on the other. Randy told his father that he would take care of all of his parents' needs. Finally, Warren Bacon testified that there were a lot of things he could not do, because of a bad back and shoulder, and he would have to hire someone to do them. He said that Randy was the only son who volunteered help and future support. The evidence showed that Warren Bacon and his wife had received no financial support from Randy in the five years preceding the trial.

In Ivy v. Security Barge Lines, Inc., 585 F.2d 732, 740 (5th Cir. 1978), on reh. 606 F.2d 524 (5th Cir. 1979) (en banc) (portions of initial decision applicable here were reinstated by en banc panel), cert. denied, 446 U.S. 956 (1980), the Fifth Circuit addressed a similar claim of monetary loss based upon the fact that a son had performed helpful chores while residing with his parents. The court held that because

[n]o documentary evidence was introduced establishing the amount of his financial contributions to the family, nor were his services around the house in any way valued ... the evidence of support and services was insufficient to show that the Ivys suffered any monetary loss for support and services by their son's death; the net value of his contribution to the household was offset by the room and board furnished him.

Id. at 740. In the instant matter, no evidence was introduced as to the value of the services Randy Bacon performed while staying with his parents. There was also no evidence that Randy Bacon made any financial contributions to his parents. Accordingly, we conclude that the evidence was insufficient to support the award to Randy Bacon's parents of $25,000 for loss of support and services.

There is even less evidence to support an award to Guinsbourg's father for loss of support and services.

The district court stated in its opinion that "Jean Yves Guinsbourg sent money home out of his earnings as a fisherman. He once sent $500, a considerable amount for one in his circumstances. He probably would have continued to contribute had he lived." In its order denying the motion to amend, the district court said, "George Guinsbourg testified his family helped each other out as needed. His son ... sent $500 home to his parents to pay off the debt of a brother." The district court found the testimony of George Guinsbourg credible.

George Guinsbourg testified that he was 67, retired and lives in New York. He receives a pension and gets along financially. George Guinsbourg also testified that he stayed in regular contact with his son throughout Jean's life, even after Jean left New York at the age of 20. George Guinsbourg testified further that the family was rather helpful and, if anyone needed anything, they would get help. He said that one time Jean sent him $500 to pay back what George had loaned to another son. The witness told the court that he had no doubt that if he needed help, Jean would give it to him. The evidence showed, however, that Jean had given no support to his family in the previous five years.

This evidence does not support a finding that Jean gave support and services to his father. "The amount of contribution by the decedent during his lifetime to the claimed beneficiary has a direct bearing on the issue of reasonable expectation of pecuniary benefit." Cleveland Tankers, 169 F.2d at 624. There was no evidence that Jean Guinsbourg contributed to his father. The only money given to George Guinsbourg over the years was the $500 Jean gave him to repay what he had loaned to one his brothers. This money did not contribute to the support of his father. It merely restored his father's financial resources to the same position they were in prior to the loan. The evidence was insufficient to support the award of $25,000 to Jean Guinsbourg's father.

III

LOSS OF FUTURE EARNINGS

The district court awarded $300,000 to Bacon's parents and to Guinsbourg's father under the Jones Act, 46 U.S.C. § 688(a) (1982), for loss of future earnings. In so doing it found that "both men would have earned approximately $300,000 over their lives as fisherman." Lasseigne argues that this award is not available under the Jones Act. We agree.

This court reviews de novo the availability of damages under a statute. Bergen, 816 F.2d at 1350.

The Jones Act provides, in pertinent part, as follows:

Any seaman who shall suffer personal injury in the course of his employment may, at his election, maintain an action for damages at law, with the right of trial by jury, and in such action all statutes of the United States modifying or extending the common-law right or remedy in cases of personal injury to railway employees shall apply; and in case of death of any seaman as a result of any such personal injury the personal representative of such seaman may maintain an action for damages at law with the right of trial by jury, and in such action all statutes of the United States conferring or regulating the right of action for death in the case of railway employees shall be applicable.

46 U.S.C. § 688(a). The Federal Employees' Liability Act (FELA), 45 U.S.C. § 51 et seq. (1982), is the statutory authority for actions arising out of injuries to railway employees. Section 51 provides that a railroad "shall be liable in damages to any person suffering injury while he is employed by such carrier ... or in case of the death of such employee, to his or her personal representative, for the benefit of the surviving widow or husband and children of such employee; and, if none, then of such employee's parents...." Section 59 provides that " [a]ny right of action given by this chapter to a person suffering injury shall survive to his or her personal representative...."

The Supreme Court has interpreted section 59 as providing that the personal representative may survive to the "right existing in the injured person at his death--a right covering his loss and suffering while he lived, but taking no account of his premature death or what he would have earned or accomplished in the natural span of life...." St. Louis, I.M. & . S. Ry. v. Craft, 237 U.S. 648, 658 (1915) (emphasis added). In tying FELA to the Jones Act, the Supreme Court has held that only the loss suffered by the decedent before he or she died can be recovered in a survival action. Van Beck v. Sabine Towing Co., 300 U.S. 342, 347 (1937) (citing Craft, 237 U.S. at 658). See also, Evich v. Morris, 819 F.2d 256, 258 (9th Cir.), cert. denied, 108 S. Ct. 261 (1987) (in dictum we stated that future economic losses cannot be recovered in a survival action under the Jones Act), Hickman v. Taylor, 170 F.2d 327, 329 (3d Cir. 1948) (recovery of the economic value of decedents life for the period of probable life expectancy is not available under the Jones Act), cert. denied, 336 U.S. 906 (1949). Thus, the district court erred in awarding damages for loss of future earnings pursuant to the Jones Act.

In its Cross-Appeal, the claimants argue that if we decide that the loss of future earnings is not available pursuant to the Jones Act, "there is an alternative basis for the award under the survival action of general federal maritime law...." Accordingly, the claimants contend, the district court erred when it held that general federal maritime law does not apply to this action. We agree.

In Evich v. Connelly, 759 F.2d 1432, 1434 (9th Cir. 1985), cert. denied, 108 S. Ct. 261 (1987), following the decision in Azzopardi v. Ocean Drilling & Exploration Co., 742 F.2d 890, 893-94 (5th Cir. 1984), where survival actions were allowed to supplement DOHSA actions, we held that maritime survival actions are available under general federal maritime law. Following remand, when the case was before us on appeal a second time, the issue was whether future economic loss, i.e., loss of future earnings, was available along with an award for pain and suffering. Evich v. Morris, 819 F.2d at 258.

We said that,

[w]hile the majority of states do not allow future economic loss to be recovered in survival actions, and the Jones Act provides for no such recovery, we find recovery here " 'better becomes the humane and liberal character of proceedings in admiralty' " and prevents the anomaly of rewarding a petitioner for killing his victim rather than injuring him. Most states and the Jones Act allow these damages to be recovered in the form of loss of support when wrongful death beneficiaries exist. Where ... those beneficiaries do not exist, potential problems with double recovery do not exist. Under these circumstances, the decedent's estate should be compensated for loss of future earnings² .

Id. (quoting Moragne v. States Marine Lines, 398 U.S. 375, 387 (1970)) (emphasis added) (citation omitted).

We have held that there are no wrongful death beneficiaries available in this action. Thus, an award for loss of future earnings is available under Evich v. Connelly and Evich v. Morris.

On remand, the district court should hold further hearings on the amount of future earnings that should be awarded under general federal maritime law. There is insufficient evidence in the record at this time to support the $300,000 award that was made for the same loss under the Jones Act. The only testimony regarding loss of future earnings related to Kenneth Lasseigne. In a Supplemental Memorandum Concerning Damages filed by Guinsbourg, the attorney for Guinsbourg's estate attempted to take the figures regarding loss of future earnings presented by the experts during trial and apply them to Guinsbourg's life expectancy. There was no independent evidence of either Guinsbourg or Bacon's life expectancies. We also cannot tell from the record what evidence the district court relied upon as the basis for awarding $300,000. Finally, because Bacon and Guinsbourg were not the same age when they died, future earnings should have been based on different life expectancies.

IV

DISCOUNT RATE

Lasseigne & Sons argues that the district court erred because it (1) did not state in its opinion whether it used a discount rate in determining the amount of damages for loss of future earnings and loss of support and (2) did not specify which discount rate it applied, if in fact it applied one. The claimants argue (1) that Lasseigne & Sons waived this argument because they failed to raise it in their post-trial motions and (2) even if the argument is not considered waived, the failure to specify was harmless error in light of the court's actions during trial.

Lasseigne & Sons did not waive this issue. The issue of discount rates and life expectancies was litigated during trial. Because a party is not required to file post-trial motions before an appeal is taken, the failure to challenge the lack of a specified discount rate in a district court's order and final judgment during post-trial proceedings is not a waiver of the issue.

" [A]wards based on income streams spread over time are usually discounted to present value to account for the fact that a plaintiff, by receiving the money in a lump sum, 'up front,' will invest the sum and earn additional income from the investment." Trevino v. United States, 804 F.2d 1512, 1517 (9th Cir. 1986), cert. denied, 108 S. Ct. 70 (1987). The choice of a discount rate is reviewed for an abuse of discretion. Colleen v. United States, 843 F.2d 329, 331 (9th Cir. 1988); see also, McCrann v. United States Lines, Inc., 803 F.2d 771, 776 (2d Cir. 1986) (abuse of discretion standard for discount rates applied in an admiralty case). "The choice among methods is left to the trial judge, who must explain which approach he adopted." Shaw v. United States, 741 F.2d 1202, 1207 (9th Cir. 1984).

The district court did not state in its opinion what discount rate it applied, if any. Because the record is unclear, we vacate the award of $300,000 for future earnings and remand the issue to the district court so that it may make specific findings regarding the discount rate. "On remand, the decision on whether to reopen the record should be left to the sound discretion of the trial court." Jones & Laughlin Steel Corp. v. Pfeifer, 462 U.S. 523, 551 (1983) (remand for determination of discount rates).

V

INTEREST RATE

Lasseigne & Sons argues that the prejudgment interest rate awarded was incorrect. The district court awarded prejudgment interest in the amount of 9% per annum.

In admiralty cases "pre-judgment interest is within the discretion of the trial judge." Western Pacific Fisheries, Inc. v. SS President Grant, 730 F.2d 1280, 1288 (9th Cir. 1984). The court's "discretion must be exercised with a view to the fact that pre-judgment interest is an element of compensation, not a penalty." Id.

It appears that the district court applied the Oregon statutory rate of 9% for prejudgment interest. ORS Sec. 82.010(3). Lasseigne & Sons argues that the appropriate rate of interest is that set forth in 28 U.S.C. § 1961(a). According to Lasseigne the appropriate rate under section 1961(a) would be 6.57% per annum.

In Columbia Brick Works Inc. v. Royal Ins. Co., 768 F.2d 1066, 1071 (9th Cir. 1985), we said that in admiralty cases, section 1961(a) is "appropriate for fixing the rate for prejudgment interest unless the equities of a particular case demand a different rate." We held "that a court may choose the local rate of interest in its discretion if the equities demand ..." Id.

In Western Pacific Fisheries, 730 F.2d at 1289, we concluded that absent a finding by the trial court that equities demand a different rate of interest, the rate in section 1961 applies. We reversed the award for pre-judgment interest and remanded so that the district court could make a specific finding regarding the rate he chose to apply. Id.

In accordance with our decision in Western Pacific Fisheries, we vacate the district court's award of prejudgment interest and remand it for further proceedings. The district court gave no basis for applying the 9% rate over the rate applicable under section 1961. Remand will give the district court the opportunity to explain its choice of rates. If on remand the district court should decide that the rate provided for by section 1961 is not applicable, then it is directed to make findings explaining the rate that it relies upon for the period of time at issue.

CONCLUSION

With regard to Lasseigne's appeal, we reverse the district court's awards of $25,000 to Bacon's parents and Guinsbourg's father and the awards of $300,000, for loss of future earnings under the Jones Act. With regard to the claimants' cross-appeal, we reverse the ruling that an award for loss of future earnings is not available pursuant to general federal maritime law. On remand the district court must determine the amount of damages incurred for loss of future earnings under general federal maritime law. The district court is directed to make findings regarding the appropriate discount rate. The award of prejudgment interest is also vacated. The district court is directed to make findings to support its application of a rate other than that set forth in section 1961, or, in the alternative, to apply the federal statutory rate. Each party shall bear its own costs.

REVERSED AND REMANDED.