Court Opinion

ID: 9568995
Source: CourtListenerOpinion
Date Created: 2023-08-21 20:09:28.277112+00
Date Added: 2024-06-11T11:18:26.816058
License: Public Domain

NOONAN, Circuit Judge,
dissenting:
Among the statutes enacted by the First Congress was the Act of July 20, 1790 establishing a seaman’s right to the prompt payment of his wages and a remedy for this right in federal court. 1 Stat. 133. No other class of contracts was so marked off. No other class of potential plaintiffs was provided with a timetable in terms of which the debt owed them had to be paid.
Seamen’s wages were bound by law to the ship the seamen sailed. A lien on the vessel for their payment was “so sacred” that “it adheres to the last plank of the ship.” Sheppard v. Taylor, 30 U.S. 675, 710, 5 Pet. 675, 8 L.Ed. 269 (1831) (per Story, J.). The connection of ship and wages due was such that it could be said that a seaman’s wages “are nailed to the ship.” The Eclipse, 53 F. 273, 277 (N.D.Cal.1892).
This extraordinary solicitude for seamen — this linkage of seamen and ship and federal supervision — was not the product of a romantic vision of life at sea, but came from a grasp of its grim realities: the resources, social status, and bargaining position of the vessel owner set over against the paltry options of the individual seaman. Together with that appreciation of the seaman’s lot went a sense of the importance of a merchant marine and its sailors to the economy of the nation and to its defense. The classic expression of the convergence of all these interests in federal solicitude for the seaman is the opinion of Justice Story, a native of the port of Salem, as he sat on circuit in Maine. Harden v. Gordon, 11 F. Cas. 480 (C.C.D.Me.1823). The continuing strength of this convergence was confirmed by the Supreme Court’s citation and quotation of Harden in Vaughan v. Atkinson, 369 U.S. 527, 82 S.Ct. 997, 8 L.Ed.2d 88,
In time the protection of federal law was extended by statute to foreign seamen whose ships were in American ports. Strathearn S.S. Co. v. Dillon, 252 U.S. 348, 354, 40 S.Ct. 350, 64 L.Ed. 607 (1920). The extension was undoubtedly designed to prevent American seamen, who could sue, from being replaced by those who could not. Id. at 355-56, 40 S.Ct. 350. The statute is of special relevance here where the plaintiffs are foreigners and where counsel for Royal Caribbean acknowledge in their brief that many of its employees are foreigners.
Even with the significant change in bargaining power brought about by the National Labor Relations Act of 1937, the seaman’s right to sue directly for his wages was prized by individual seamen and upheld by the Supreme Court. U.S. Bulk Carriers, Inc. v. Arguelles, 400 U.S. 351, 91 S.Ct. 409, 27 L.Ed.2d 456 (1971). Deciding Arguelles, the Supreme Court noted that the explicit remedy permitting the seamen’s suit was “not clearly taken away” by the National Labor Relations Act. Id. at 357, 91 S.Ct. 409. The Court added: “What Congress has plainly grant*1160ed we hesitate to deny.” Id. And the Court did not deny it. This precedent speaks powerfully in the case at bar.
Federal solicitude for the seaman is today embodied in 46 U.S.C. § 10313, simply entitled “Wages.” The statute begins by specifying when a seaman’s “entitlement to wages and provisions” begins. The statute provides that wages “are not dependent on the earning of freight by the vessel.” The statute provides for payment to a seaman before the beginning of the voyage and for non-payment if refusing to work. Near the center of the statute is this provision: “After the beginning of the voyage, a seaman is entitled to receive from the master on demand one-half of the balance of wages earned and unpaid at each port at which the vessel loads or delivers cargo during the voyage.” At the end of a voyage the master must pay the balance of wages due within 24 hours after the voyage ends. The master or owner is liable for 2 days wages for each day payment is delayed. Exclusions and inclusions within the statute are spelled out. Excluded from some provisions are fishing and whaling vessels and yachts. Included are seamen “on a foreign vessel when in a harbor of the United States.”
This last provision must be considered in relation to what Chapter 103 — Foreign and Intercoastal Voyages embraces. The introductory language reads: “Except as otherwise specifically provided, this chapter applies to a vessel of the United States on a voyage between a port in the United States and a port in a foreign country (except a port in Canada, Mexico, or the West Indies).” If this portion of Chapter 103, which is entitled “Application,” confines the chapter to U.S. vessels and requires that the voyage be between the United States and the non-excluded parts of the world, then the Wage Act has no application here. But the Wage Act specifically provides that it applies to seamen “on a foreign vessel when in a harbor of the United States.” No requirement that the vessel be American. No requirement that the vessel’s voyage have a particular international destination. It appears that the particular controls the general and that the statute protects foreign seamen in an American port. This reading is confirmed by a broad grant of jurisdiction that concludes the statute: “The courts are available to the seaman for enforcement of this section.”
The provisions of Chapter 103 of Title 46 should be read in harmony with a second statute simply denominated “Seamen’s suits.” It reads as follows: “In all courts of the United States, seamen may institute and prosecute suits and appeals in their own names and for their own benefit for wages or salvage or the enforcement of laws enacted for their health and safety without prepaying fees or costs or furnishing security therefor.” 28 U.S.C. § 1916.
As set out in the current U.S.Code, the Wages Act incorporates amendments made in 1983 and in 1986. Neither it nor the Seamen’s suits Act have been repealed. They contain no reference to federal law on arbitration. The careful exclusions of the Wages Act do not mention the subject. It is nonetheless the contention of Royal Caribbean that both statutes have been substantially repealed as to foreign seamen. Let us examine the basis for this remarkable contention.
The first step in Royal Caribbean’s case is page 1 of a fax of a printed form entitled Sign-On Agreement dated November 1, 2005. Its first part provides the make of the ship, the MTV Monarch of the Seas and the name of Hulya Kar, her age, and her residence is Istanbul, Turkey. The second part identifies her job: “Assistant Waiter,” the portion of her “basic pay payable by the company:” $50; her monthly overtime rate: $3.98; her monthly vacation pay: 0; *1161her daily sick wage rate: $15.30; and her monthly guaranteed pay: $890, specified to be “inclusive of all gratuities provided by passengers.”
The form then states in the first person an acknowledgment that the employer may terminate the agreement on 7 days notice. It continues: “I further understand and agree that the Collective Bargaining Agreement between the Company and the Union is incorporated into and made part of this Employment Agreement and that I and the Company are bound by its terms and conditions.”
The document is signed by the employee. In a new paragraph on the same page appears the following: “I acknowledge having received copies of (1) the Collective Bargaining Agreement referred to above effective on the date of this Employment Agreement; (2) The Employee Handbook.” The signature line under this statement is for the signature of the “Payroll Purser” and is apparently so signed and dated by him.
A Collective Bargaining Agreement (CBA) between Royal Caribbean and the Norwegian Seafarers Union is included in the excerpt of record. It occupies 24 pages. Its signature on behalf of the company is dated August 23, 2005 but Article 28 provides that it “is effective from January 1, 2005.”
Article 26 of the CBA is entitled “Grievance and Dispute Resolution Procedure.” Section (b) of this article states what is to happen “if the dispute is one involving the amount of wages paid to the Seafarer.” On receiving notice of “a grievance” in this regard, the Employer has the right within 60 days to either pay the amount claimed or to deposit it in an interest-bearing account. If the legal resolution of the grievance is in favor of the employee, he receives no more than the sum deposited by the Company plus the accrued interest. Section (d) of Article 26 provides the procedure for the resolution of “all grievances and any dispute whatsoever.” It is to be “by binding arbitration pursuant to the United Nations Convention.”
The drift of Royal Caribbean’s argument is now evident: By signing on to the form, Kar agreed to arbitrate as the CBA provided, and the CBA provides no place for an action in a federal court. By contract Kar has no choice but to arbitrate.
What’s wrong with this argument? It assumes that the rights conferred on seaman by U.S.C. § 10313 may be waived by contract. The assumption runs counter to general maritime law. Again, Justice Story is a good guide: Bargains between shipowners and seaman are scrutinized “with scrupulous jealousy” by courts of admiralty. Brown v. Lull, 4 F.Cas. 407, 409 (D.Mass.1936). Any stipulation in the shipping articles derogating from the seaman’s rights is void unless the clause was “fully and fairly explained to the seamen” and they were compensated for the waiver. Id. This approach has prevailed: “The analogy suggested by Justice Story between seamen’s contracts and those of fiduciaries and beneficiaries remains, under the prevailing rule treating seamen as wards of admiralty, a close one.” Garrett v. Moore-McCormack Co., 317 U.S. 239, 247, 63 S.Ct. 246, 87 L.Ed. 239 (1942). The shipowner who relies on a seaman’s release of his rights must show “that it was executed freely, without deception or coercion and that it was made by the seaman with full understanding of his rights.” Id. at 248, 63 S.Ct. 246.
In our case, Kar has stipulated that she signed the Sign-On Agreement which incorporated the CBA. She has not stipulated that she saw the CBA, read it, or understood it, or that her attention was drawn to the federal rights she was waiving. The most we have from the Sign-On Agreement is that “copies” of the CBA *1162were received by someone, apparently the purser. In the absence of any stipulation or other evidence, the incorporation of the arbitration clause into the Sign-On Agreement was void.
Royal Caribbean attempts to avoid this conclusion by this line of argument: The Convention, admittedly not selfexecuting, has been enacted into federal law by 9 U.S.C. § 202. This statute commands the federal courts to enforce all international agreements to arbitrate, no exceptions admitted. It is Royal Caribbean’s position that it is this statute, not Ear’s Sign-On Agreement that puts a dent or, rather, a hole in 46 U.S.C. § 10313’s set of rights and remedies.
This contention is a slight of hand. The statute enforcing the Convention comes into play only if there is a valid agreement to arbitrate. We have already determined that no such agreement exists. The international arbitration statute has not been set in motion.
And even if it were, what rule of construction would tell us that the statute, enacted in 1971, trumps a statute that long preceded it and was amended and codified in the 1980’s? To suppose that Congress in 1971 meant to repudiate a role for federal courts that went back to 1790 — and did so without a single explicit word — is to engage in unlikely fantasy. To suppose that Congress in the 1980’s kept alive a statute expressly opening the federal courts to foreign seamen when the alleged sense of the 1971 statute mandated arbitration in their place is to credit Congress with absentmindedness and to fail to acknowledge the later statute as the governing statute. Frost v. Wenie, 157 U.S. 46, 57, 15 S.Ct. 532, 39 L.Ed. 614 (1895) (per Harlan, J.).
In Arguelles, a new and powerful national policy, collective bargaining, was urged to have led to legislation making obsolete and defunct the seaman’s direct remedy in federal court. In our case a new and powerful national policy in favor of international arbitration is urged to reach the same result. But neither the National Labor Management Relations Act nor the Convention addressed the seaman’s statutory rights. No more than the Court in the Arguelles case should we do what Congress did not do and proclaim the elimination of the statutory remedy for foreign seamen. Congress has chosen to set in place two routes for the seaman, including the foreign seaman. He or she may arbitrate or he or she may proceed without paying costs to sue in a federal district court.