MNM Boats Inc v. Johnson ( 2001 )

UNITED STATES COURT OF APPEALS
For the Fifth Circuit
No. 99-30805
MNM BOATS, INC.,
Plaintiff-Appellee,
VERSUS
NEAL H. JOHNSON,
Defendant-Appellant.
Appeal from the United States District Court
For the Eastern District of Louisiana
(97-CV-1892-S c/w 97-CV-3588-S)
January 22, 2001
Before DUHÉ and PARKER, Circuit Judges, and FOLSOM1, District
Judge.
PER CURIAM:2
Appellee MNM Boats, Inc. (“MNM”) filed a declaratory judgment
suit against its employee, Appellant Neal H. Johnson (“Johnson”),
to resolve the question of its obligations to Johnson for payments
of maintenance and cure. MNM provided maintenance and cure to
Johnson after he was injured while working aboard a vessel that MNM
1
District Judge of the Eastern District of Texas, sitting by designation.
2
Pursuant to 5TH Cir. Rule 47.5, the court has determined that this opinion should not be
published and is not precedent except under the limited circumstances set forth in 5th Cir. Rule
47.5.4.
operated. Eventually, the company physician, Dr. Rutledge, and
another doctor each determined that Johnson had no impairment and
that he could return to work. Dr. Rutledge later discharged
Johnson because Johnson failed to keep several appointments and
follow the prescribed treatment, and MNM ceased making maintenance
and cure payments. Thereafter, Johnson consulted his own physicians
who made contradictory medical findings. Based on the testimony of
Johnson's doctors, the district court held that Johnson had not
reached maximum medical improvement and was therefore entitled to
past and future maintenance and cure, until such time as his
treating physician determined that additional treatment would
probably not improve his condition. However, the court did not
award Johnson compensatory damages and attorney's fees from MNM for
the termination of and failure to reinstate the maintenance and
cure payments, because it found that the termination was not
unreasonable since there had been a genuine dispute among the
physicians. Johnson now appeals that ruling.
DISCUSSION
The maintenance and cure obligation is designed to provide a
seaman who is injured while in the service of his ship with
reimbursement for his medical and subsistence expenses until he
reaches maximum medical improvement. Vaughn v. Atkinson, 369 U.S.
527, 531, 82 S. Ct. 997, 1000, 8 L. Ed. 2d 88 (1962); Morales v.
Garijak, Inc., 829 F.2d 1355, 1358 (5th Cir. 1987), abrogated on
other grounds by Guevara v. Maritime Overseas Corp., 59 F.3d 1496
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(5th Cir. 1995). Upon receiving a claim for maintenance and cure,
the employer is entitled to investigate and require corroboration
of the claim before making payments. Morales, 829 F.2d at 1358.
If the employer, after investigating the claim, refuses to pay
without a reasonable defense, he becomes liable not only for
maintenance and cure but also for compensatory damages. In
addition, if the employer has exhibited callousness and
indifference to the seaman's plight, he becomes liable for
attorney's fees. Id.; Guevara, 59 F.3d at 1512. We have
described the conduct giving rise to a claim for attorney's fees as
“callous and recalcitrant,” “arbitrary and capricious,” and
“willful, callous, and persistent.” Holmes v. J. Ray McDermott &
Co., Inc., 734 F.2d 1110, 1118 (5th Cir. 1984), overruled on other
grounds by Guevara, 59 F.3d at 1512. When the seaman refuses
treatment, the employer is not obligated to make payments for the
days voluntarily spent without care. Brown v. Aggie & Millie,
Inc., 485 F.2d 1293, 1296 (5th Cir. 1973).
We must review the district court's finding that an employer
has not acted unreasonably or arbitrarily in terminating
maintenance and cure only for clear error. Breese v. AWI, Inc.,
823 F.2d 100, 103 (5th Cir. 1987). We find no clear error here.
As the finder of fact, the trial court was entitled to weigh the
evidence and the credibility of the physicians to determine whether
MNM had a genuine reason to terminate the maintenance and cure
payments. In its order and reasons for awarding maintenance and
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cure, the trial court noted that although there was some question
about whether Johnson could afford to pay for transportation to his
missed appointments with Dr. Rutledge, Johnson clearly did not
follow Dr. Rutledge's recommendations on exercise. The court also
noted that after Johnson's own physician, Dr. Dyas, recommended he
undergo surgery, Dr. Rutledge reexamined Johnson and confirmed that
he still found no evidence of debilitating injury and that he
believed that surgery would in fact worsen Johnson's condition.
Later, the second doctor consulted by MNM reviewed Dr. Dyas's
findings and agreed that surgery was not indicated. Nevertheless,
as the trial judge observed in refusing to amend the judgment,
MNM's claims representative continued to pursue Johnson's claim and
to refer new medical information to MNM's physicians despite their
opinions that there was no medical evidence to support Johnson's
complaints.
Accordingly, we find no clear error in the district court's
finding that MNM did not act unreasonably or egregiously. We have
stated that a failure to pay maintenance and cure is reasonable if
a diligent investigation indicates that the seaman's claim is not
legitimate. Morales, 829 F.2d at 1360. The trial court,
therefore, was perfectly entitled to find that MNM's conduct was
reasonable, after taking account of MNM's ongoing investigation of
Johnson's claims, the two physician's opinions that Johnson had no
debilitating injury, and their opinion that surgery was not
advisable. The court was entitled to make this finding even though
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it ultimately concluded that Johnson had not reached maximum
medical improvement. Further, Johnson has not identified any
conduct on the part of MNM which would rise to the level of a
callous disregard for his plight.
Moreover, we refuse to adopt the rule that necessarily follows
from Johnson's position, which is that any time there is a dispute
among physicians concerning the employee's condition, any
termination of maintenance and cure by the employer is per se
unreasonable or egregious. We acknowledge the rule that doubts
about the employer's obligation to pay maintenance and cure should
be resolved in favor of the seaman. Vaughn, 369 U.S. at 532, 82 S.
Ct. at 1000. However, Johnson has cited no case holding that a
dispute among physicians, without more, is an unreasonable or
arbitrary basis for terminating maintenance and cure which triggers
an obligation to pay compensatory damages and attorneys fees, and
we have found none.
Johnson has also appealed the district court's denial of his
motion to enforce payment of the judgment with respect to
maintenance and cure which has accrued since the date of trial.1
However, at oral argument, counsel for both parties confirmed that
MNM has brought Johnson's maintenance and cure payments up to date.
1
Although Johnson's notice of appeal designated the denial of his motion for reconsideration
of the motion to enforce the judgment as the order appealed, that timely filed motion brought up the
underlying order for review, and the appeal may be properly taken from the underlying order. See
Fletcher v. Apfel, 210 F.3d 510, 512 (5th Cir. 2000).
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Therefore, Johnson's appeal of the district court's ruling on this
matter is moot.
CONCLUSION
Because we have found no clear error in the district court's
decision denying Johnson compensatory damages and attorney's fees,
we AFFIRM. We also AFFIRM the district court's denial of Johnson's
motion to enforce payment of judgment. Johnson's motion to
supplement the record, which was carried with the case, is DENIED.
The medical information offered was not submitted to the district
court and we cannot consider it.
AFFIRMED.
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