Opinion
No. 01-3123, Section "R"(2)
October 22, 2002
ORDER AND REASONS
Before the Court are three motions for summary judgment. First, Chevron moves for summary judgment on plaintiff Dale Champagne's claims. Second, Chevron moves for summary judgment on Comar's claims for contribution and indemnification. Last, Texaco moves for summary judgment. For the following reasons, the Court denies all three motions.
I. Background
Plaintiff, Dale Champagne, was a seaman employed by defendant Nautical Offshore Corporation d/b/a Comar. On October 16, 2000, Champagne worked as an engineer aboard the M/V C/VALIANT as it pulled up alongside a docking facility owned by Chevron U.S.A., Inc. Plaintiff allegedly injured his right ankle when he stepped into a hole as he helped to secure the vessel to the dock.
Plaintiff filed this maritime action against Comar for maintenance and cure and damages caused by Comar's negligence. Comar, in turn, named Chevron a third party defendant, asserting that plaintiff's injuries were caused by Chevron's negligence in failing to maintain the dock and that it is entitled to recover maintenance and cure payments it made to Champagne, as well as contribution from Chevron if it is held liable for negligence. Plaintiff then asserted a claim against Chevron for negligence. In response, Chevron asserts that a contract between Chevron and Texaco requires Texaco to defend and indemnify Chevron from claims for liability such as Champagne's. Accordingly, Chevron sued Texaco as a third party defendant. To bring the lawsuit full circle, Texaco asserts that it is entitled to indemnification from Comar and Comar's insurer.
II. Discussion
A. Legal Standard
Summary judgment is appropriate when there are no genuine issues as to any material facts, and the moving party is entitled to judgment as a matter of law. FED. R. CIV. P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 2551 (1986). The court must be satisfied that no reasonable trier of fact could find for the nonmoving party or, in other words, "that the evidence favoring the nonmoving party is insufficient to enable a reasonable jury to return a verdict in her favor." Lavespere v. Niagara Mach. Tool Works, Inc., 910 F.2d 167, 178 (5th Cir. 1990); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510 (1986). The moving party bears the burden of establishing that there are no genuine issues of material fact. Krim v. BancTexas Group, Inc., 989 F.2d 1435, 1445 (5th Cir. 1993). A factual dispute precludes a grant of summary judgment if the evidence would permit a reasonable jury to return a verdict for the nonmoving party. See Hunt v. Rapides Healthcare System, LLC, 2001 WL 1650961 (5th Cir. 2001) (citations omitted).
If the dispositive issue is one for which the nonmoving party will bear the burden of proof at trial, the moving party may satisfy its burden by merely pointing out that the evidence in the record contains insufficient proof concerning an essential element of the nonmoving party's claim. Celotex, 477 U.S. at 325, 106 S.Ct. at 2552; Lavespere, 910 F.2d at 178. The burden then shifts to the nonmoving party, who must, by submitting or referring to evidence, set out specific facts showing that a genuine issue exists. Celotex, 477 U.S. at 324, 106 S.Ct. at 2553.
B. Chevron's Motion for Summary Judgment Seeking to Dismiss plaintiff's Claims
Chevron moves for summary judgment on Champagne's claims for negligence. In claims such as Champagne's, the Fifth Circuit has held that "[t]he gangplank has served as a rough dividing line between the state and maritime regimes." Florida Fuels, Inc. v. Citgo Petroleum Corp., 6 F.3d 330, 332 (5th Cir. 1993) (quoting Victory Carriers, Inc. v. Law, 404 U.S. 202, 207, 92 S.Ct. 418, 422 (1971)). Maritime law covers the gangway and means of access between a vessel and the dock. Id. Piers and docks, on the other hand, "are deemed extensions of land." Id. As such, state law governs liability for negligence arising from accidents that occur on piers and docks. "Absent a maritime status between the parties, a dock owner's duty to crew members of a vessel using the dock is defined by the application of state law, not maritime law." Id.
Here, the alleged accident occurred on Chevron's "land." specifically, just before the accident occurred, Champagne attempted to secure the VALIANT to Chevron's dock using ropes. (Chevron's Not. for Summ. J., Dep. of Champagne, at 39.) Unable to secure the ropes from the vessel, Champagne exited the vessel onto the bulkhead. From the bulkhead, Champagne jumped down to the ground. (Pl.'s Opp. to Chevron's Not. for Summ. J., Dep. of Champagne, at 50.) Champagne's ankle landed in a hole roughly two feet wide and one foot deep. ( Id. at 46.) Because the accident occurred on Chevron's land, Chevron's liability is governed by state law. Florida Fuels, 6 F.3d at 332-33.
Louisiana law has long provided that dock owners owe invitees, including employees of vessels using the dock facility, the duty to provide a dock that is reasonably safe. Id.; see also Young v. Cenac Towing Company, Inc., 1997 WL 685267, *1 (E.D.La. 1997); Sons v. New Amsterdam Casualty Company, 186 So.2d 375, 376 (La.Ct.App. 1966). Chevron asserts that it is not liable for Champagne's alleged injuries because Champagne was familiar with the docking facilities, and the hole giving rise to the accident was open and obvious. To the contrary, Champagne's testimony indicates that while he had used the facility on a number of occasions, he had been in the area where the accident occurred on only two earlier occasions. (Dep. of Champagne, at 41 and 56.) Moreover, this was the first time that Champagne exited a boat in this area. ( Id. at 56.) Further, the area was dark. ( Id. at 52.) Indeed, Champagne testified that before he jumped from the bulkhead down to the ground, he looked down but "couldn't see nothing because it was dark." ( Id. at 51.) inadequate lighting may be grounds for finding that a docking facility is not reasonably safe. Sons, 186 So.2d at 376.
The Court is aware that Champagne also testified that when he stood on the ground after the accident, he was able to see the hole from a distance of one foot. (Dep. of Champagne, at 151.)
To be sure, there are indications that Champagne may have been contributorily negligent. Sons, 186 So.2d at 376. For example, Champagne testified that it is common for holes to appear on the ground at facilities like Chevron's, although this hole was uncommonly large. ( Id. at 52 and 61.) Also, Champagne had a flashlight on the vessel that he could have used. Indeed, Champagne indicated that because of the darkness he "was wrong for not grabbing it." ( Id. at 156.) Nevertheless, the Court finds that the size of the hole, its location, and the lighting of that location raise issues of material fact as to whether Chevron provided a reasonably safe docking facility. Given the evidence provided, the Court cannot conclude as a matter of law that Chevron is not liable, at least in part, for Champagne's injuries. Therefore, the Court denies Chevron's motion for summary judgment.
C. Chevron's Motion for Summary Judgment Dismissing the Claims of Comar for Indemnity and Contribution
Chevron also moves for summary judgment on Comar's claims for indemnity and contribution. Chevron contends, correctly, that its liability to Champagne is governed by Louisiana law, which provides that a dock owner owes to seamen a duty to provide a reasonably safe docking facility. Florida Fuels, 6 F.3d at 332-33. Chevron then asserts that Comar is not entitled to indemnification or contribution from Chevron because, under Louisiana law, joint tortfeasors do not owe contribution and indemnity to other tortfeasors. See LA. CIV. CODE art. 2324 (West 2002).
Chevron's assertion is without merit. Although Chevron's liability to Champagne is governed by state law, Comar's exposure to liability for maintenance and cure is governed by federal maritime law. Under federal maritime law, a seaman's right to receive maintenance and cure, along with the shipowner's duty to pay, "is implied in the employment contract" between the parties and is "in no sense predicated on the fault or negligence of the shipowner." Bertram v. Freeport McMoran, Inc., 35 F.3d 1008, 1013 (5th Cir. 1994). It has long been held that the shipowner may then recover those payments "from a third-party whose negligence partially or wholly caused the seaman's injury." Id.; Savoie v. LaFourche Boat Rentals, 627 F.2d 722, 723 (5th Cir. 1980); Jones v. Waterman S.S. Corp., 155 F.2d 992, 997-1001 (3rd Cir. 1946). This is based on the "commonsense principle that a party whose neglect has caused or contributed to the need for maintenance and cure payments should reimburse the cost of those payments, which would otherwise be borne by a non-negligent or passively negligent employer." Savoie, 627 F.2d at 723.
Similarly, Comar's right to contribution is governed by maritime law. When a party seeks a non-contractual right to indemnification, as is the situation here, "the body of law establishing the indemnitee's primary liability governs his claim for indemnity or contribution against a third party." Marathon Pipe Line Company v. Drilling Rig Rowan/Odessa, 761 F.2d 229, 235 (5th Cir. 1985); see also Hardy v. Gulf Oil Corporation, 949 F.2d 826, 830 n. 7 (reaffirming Marathon while also noting that state law governs a contractual claim for indemnification when the parties agreed to an enforceable choice of law provision) Comar's primary liability is governed by maritime law. Under maritime law, an employer may seek indemnification and contribution from a third-party tortfeasor for part or all of any damages assessed against the employer. Liberty Seafood, Inc. v. Herndon Marine Products, 38 F.3d 755, 758 (5th Cir. 1994); see also Coats v. Penrod Drilling Corp., 61 F.3d 1113 (5th Cir. 1995). Therefore, the Court denies Chevron's motion for summary judgment.
D. Texaco's Motion for Summary Judgment
Texaco moves for summary judgment that it is entitled to indemnity and defense from Comar. Further, Texaco asserts that it is an additional insured under Comar's policy with XL Specialty Insurance. To begin, it is important to examine the nature of the claim for which Texaco seeks indemnification. Chevron, the owner of the docking facility where Champagne's alleged accident occurred, entered into a contract with Texaco under which Chevron agreed to provide Texaco with nonexclusive access to Chevron's docks, office space, storage and parking (the "Shoreside Contract"). (Comar's Memo. in Opp. to Texaco's Mot. for Summ. J., Ex. B, Shoreside Contract.) Texaco agreed to indemnify Chevron as follows:
Texaco agrees to protect, defend, indemnify and save harmless [Chevron] from any and all claims, losses and expenses . . . arising in favor of [Texaco] . . . on account of illness, disease, bodily injury (including death) or property loss or damage in any way directly or indirectly arising out of or related to the performance or subject matter of this Agreement or the use of the Shorebase by Texaco, its employees, agents, representatives, contractors and their employees or their presence on the Shorebase, even though caused by the sole, concurrent or partial negligence, fault or strict liability of [Chevron].
(Shoreside Contract, at 9-10).
When Chevron was sued by Comar, Chevron named Texaco as a third party defendant to indemnify Chevron from liability arising out of the plaintiff's alleged accident. Thus, Texaco's liability, if any, is contractual liability arising under the Shoreside Contract. Texaco seeks indemnification for this liability from Comar. Five years before it signed the Shoreside Contract, Texaco signed a contract with Comar under which Comar agreed to transport Texaco employees out to facilities in the Gulf of Mexico (the "Transportation Contract"). (Texaco's Mot. for Summ. J., Ex. A, Transportation Contract, at 1.) Comar agreed to indemnify Texaco as follows:
[Comar agrees] to fully defend, protect, indemnify, hold harmless and render whole [Texaco] from and against each and every claim, demand or cause of action and any liability, cost, expense . . ., damage or loss in connection therewith, which may be made or asserted by [Comar], Comari's employees or agents, subcontractors or any third parties, (including but not limited to Texaco's agents, servants or employees) [on] account of personal injury or death or property damage caused by, arising out of, or in any way incidental to, or in connection with the performance of the work hereunder, whether such personal injury or death or property damage was caused by [Comar]'s sole negligence, the concurrent negligence of [Comar] and Texaco, or the sole negligence of Texaco . . . .
(Transportation Contract, at 7-8.)
The relevant issue is whether Comar must indemnify Texaco under the Transportation Contract for Texaco's contractual liability arising under the Shoreside Contract. Because the Transportation Contract is a maritime contract, interpretation of its indemnity clause is governed by federal law. Corbitt v. Diamond M. Drilling Co., 654 F.2d 329, 332 (5th Cir. 1981) Unless the document is ambiguous, courts may not look beyond its written language to determine the intent of the parties. Id. at 332-33. At the same time, indemnification provisions must be strictly construed. Smith v. Tenneco Oil Co., 803 F.2d 1386, 1388 (5th Cir. 1986). Importantly, an indemnification provision is construed to cover losses "which reasonably appear to have been within the contemplation of the parties, but it should not be read to impose liability for those losses or liabilities which are neither expressly within its terms nor of such a character that it can be reasonably be inferred that the parties intended to include them within the indemnity coverage." Corbitt, 654 F.2d at 333.
In Corbitt, the Fifth Circuit squarely held that indemnification clauses like the one in the Transportation Contract do not include indemnification for contractual claims asserted by third parties. Corbitt, 654 F.2d at 333-34; see also Foreman v. Exxon Corporation, 770 F.2d 490 (5th Cir. 1985) (affirming Corbitt in the context of a contract interpreted under Louisiana law). In Corbitt, Shell signed a contract with Diamond M under which Diamond M agreed to furnish labor and equipment for drilling. Shell agreed to indemnify Diamond M. Shell also hired Sladco to work on the project, and Sladco agreed to indemnify Shell. Plaintiff Harvey Corbitt, an employee of Sladco, was injured on the rig where work under the contracts was being performed. Corbitt sued Diamond M for negligence; Diamond M sought indemnity from Shell; and, Shell sought indemnity from Sladco, Sladco was required to indemnify Shell "against all claims, suits, liabilities and expenses on account of personal injury . . . arising out of or in connection with performance of this [contract]." Corbitt, 654 F.2d at 333. Consistent with the principle that indemnification provisions are to be strictly construed, the Fifth Circuit found that the indemnification provision "does not expressly provide that Sladco will indemnify Shell for Shell's contractual liability to third persons." Id.
Similarly, the Court finds that the indemnification clause in the Transportation Contract does not expressly provide that Comar will indemnify Texaco against contractual liability to third persons. Like the indemnification clause at issue in Corbitt, the clause in the Transportation Contract provides only that Comar will indemnify Texaco for claims on "account of personal injury or death." (Transportation Contract, at 8.) The clause makes no mention of claims arising under contracts with third parties, let alone does it "clearly express" a purpose to cover such claims. Corbitt, 654 F.2d at 334. It does not state, as it could have, that Comar will indemnify Texaco for "causes of action of whatsoever nature or character . . . and whether arising out of contract, tort, [or] strict liability." Sumrall v. Ensco Offshore Co., 291 F.3d 316, 319 (5th Cir. 2002). The Court therefore finds that Texaco may not seek indemnification from Comar for its contractual liability to Chevron.
Texaco asserts that even if it is not entitled to indemnification from Comar, Comar maintains a separate contractual obligation to name Texaco as an additional insured on Comar's insurance policy with XL. Comar's obligation to name Texaco as an additional insured is separate and independent from its obligation to indemnify Texaco. Diamond Offshore Company v. AB Builders, Inc., 302 F.2d 531, 550-51 (5th Cir. 2002); LeBlanc v. Global Marine Drilling Co., 193 F.3d 873, 875 (5th Cir. 1999) The relevant clause in the Transportation Contract reads as follows:
[Comar] agrees to procure and maintain the following insurance coverage:
* * *
E. Protection and Indemnity Insurance with a limit of liability of not less than $10,000,000 subject to Steamship Mutual Underwriting Association Form, including crew and Excess Collision Liability, with same navigation limits as Hull and Machinery Insurance, and subject to a deductible not to exceed $5,000.
* * *
Said insurance shall be endorsed to show Texaco as additional insured, shall contain waivers of subrogation in favor of Texaco and shall include in rem protection.
(Transportation Contract, at 4-5.)
Although Comar is obligated to name Texaco as an additional insured on its Protection and Indemnity Insurance policy, the Transportation Contract does not require that Comar's policy with XL cover any and all types of an assured's agreements to indemnify third parties. Indeed, the section of Comar's policy with XL that addresses coverage for an assured's indemnity obligations reads as follows:
In consideration of the premium charged for this insurance, the coverage afforded under this policy is extended to insure the liability of the assured arising out of hold harmless and/or indemnity agreements contained in such contracts that have been entered into by the Assured for the furnishing of vessel services.
(Texaco's Mot. for Summ. J., Ex. B, XL Insurance Policy, at 21 (emphasis added).) Texaco's obligation to indemnify Chevron is contained in the Shoreside Contract, which was not entered into by Texaco "for the furnishing of vessel services." Therefore, even if Texaco is properly named by Comar as an additional assured under XL's policy, XL's policy does not cover Texaco's obligation to indemnify Chevron under the Shoreside Contract because that obligation did not arise under a contract entered into by Texaco "for the furnishing of vessel services." Therefore, the Court denies Texaco's motion for summary judgment.
III. Conclusion
For the foregoing reasons, the Court denies Chevron's motion for summary judgment on plaintiff's claims; denies Chevron's motion for summary judgment on Comar's claims for indemnity and contribution; and, denies Texaco's motion for summary judgment.