Opinion ID: 350175
Heading Depth: 1
Heading Rank: 3

Heading: the release problem

Text: 34 The liability of the shipowner also turns in part upon whether or not the release given by Melson to the shipowner, when the claim for damages against the ship was settled for $1,000.00, bars the suit by the insurance carrier. The shipowner contends that since the insurance carrier-subrogee stands in the shoes of Melson, the subrogor, and since Melson released all claims he had against the shipowner for the $1,000.00, then the suit by the insurance carrier is barred by the release. The insurance carrier contends that the release which was executed solely between Melson and the shipowner and without the consent of the stevedore co.-employer, or its insurance carrier, is not binding on the latter parties nor can it affect the shipowner's liability for the prior statutory lien created for the benefits paid to Melson. The district court held that the release did not bar the insurance carrier's claim; we agree and affirm on this point. 35 As noted above, the insurance carrier's lien was statutorily created when compensation payments were made to Melson. The insurance carrier is therefore not bound by a release subsequently executed by Melson with the shipowner to which it is not a party, did not consent to, and about which it did not know. See generally : 2A C.J.S. Agency § 233 (1972).