Fifth and Eleventh Circuits split on situs

by Matthew H. Ammerman on August 27th, 2012

The work place in both of these recently decided cases was a container repair facility.

In the Zepeda case, the 5th Circuit (TX, LA, MS) affirmed an administrative law judge’s finding of LHWCA situs. However, in the Ramos case, the 11th Circuit (AL, GA, FL) reversed the ALJ and held there was no situs. Both appellate courts relied on the 5th Circuit’s en banc decision from 1980 in Texports v. Winchester. That case, decided by a full (en banc) panel of the 5th Circuit, held that that despite the statute requiring an area “adjoining” navigable water, a work area arguably related to maritime activity need not actually touch water. It is enough if "the site is close to or in the vicinity of navigable waters, or in a neighboring area, ... ." 632 F.2d 504, 514 (5th Cir. 1980) (en banc), cert. denied, 452 U.S. 905 ( 1981)(emphasis added).

There is no formulaic test to determine situs, which leads to a fact-intensive inquiry. An ALJ should consider: (1) geographic nexus - whether the site is specific sufficiently close to a waterfront; and, (2) functional nexus - whether the location has a purpose for its proximity to the waterfront.

Zepeda was container repair mechanic who worked in two yards: the Chef Yard, which is approximately 300 yards from the Industrial Canal in New Orleans, and Terminal Yard, which is approximately 100 yards from the waterfront. The ALJ found that Zepeda’s alleged hearing loss occurred on a LHWCA-covered site because the container repair facilities served in part a client whose containers were used in land and maritime transportation. The yards were also surrounded by other maritime businesses. The 5th Circuit relied heavily on its limited scope of review and held the ALJ's decision was supported by substantial evidence. Therefore, it was affirmed. New Orleans Depot Servs. v. Dir., 2012 U.S. App. LEXIS 15336 (5th Cir. July 25, 2012).

The ALJ in the Ramos case also found the container repair yard – even though it was over 3 miles from the Port of Jacksonville – was a covered situs. However, the 11th Circuit reversed the ALJ because there was no geographic nexus between the yard and the waterfront. The yard was not in the “vicinity” of navigable waters. While the tentacles of LHWCA coverage are long, situs could not be stretched that far. Ramos v. Dir., OWCP, 2012 U.S. App. LEXIS 16663 (11th Cir. Aug. 10, 2012).

Coincidentally, one of the reasons the 5th Circuit majority in Zepeda upheld LHWCA coverage is that it did not want to create a circuit split with a 1990 decision from the 11th Circuit involving a container repair facility. The 11th Circuit's Ramos case decided two weeks later did just that.

This split between circuits highlights the unpredictability of the 32-year-old “close enough” test from Winchester. Judge Clement’s dissent in the Zepeda case echoes the sentiment of many maritime employers. The Winchester test "construes situs so broadly that it threatens to swallow every employer with even a tangential relation to the maritime industry." This injects costly uncertainty into business planning, insurance decisions, and claims handling.

Posted in LHWCA: Coverage: Situs    Tagged with situs, Longshore, container repair, zepeda, ramos, winchester test



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