Opinion
Civil Action 00-0506 Section "T"(1).
June 14, 2001.
Before the Court is a Motion for Summary Judgment, pursuant to Federal Rule of Civil Procedure 56, filed on behalf of the Defendant, United Kingdom Mutual Steamship Assurance Association ("UK PI Club"), stating that Plaintiff, Gerrard P. Adams, has failed to state a cause and/or right of action against Defendant under Louisiana's Direct Action Statute. This matter came for hearing on March 28, 2001, with oral argument waived by the parties. Accordingly, the Court took the matter under submission for consideration. The Court, having reviewed the arguments of counsel, the evidence presented, the applicable law and jurisprudence, is fully advised in the premises and ready to rule.
ORDER AND REASONS
I. BACKGROUND
Plaintiff, Gerrard Adams ("Adams"), alleges that he was injured while boarding the M/V MISS DEBBIE on December 28, 1999. Adams was the Captain of the M/V MISS DEBBIE, a tug boat owned by North Bank Towing Corporation (a/k/a Odyssey Marine Group, L.L.C.) ("Odyssea Marine"), and was to begin a twenty-eight day hitch. At the time of this incident, the vessel was at sea operating in Vermillion Block 131, forty to fifty miles off the Louisiana coast in the Gulf of Mexico. Adams claims he slipped while moving from a lay barge to the M/V MISS DEBBIE, and that his injuries are the result of this accident.
At this time, Odyssea Marine maintained protection and indemnity insurance coverage for the M/V MISS DEBBIE through the UK PI Club. The UK PI Club is a Bermuda based protection and indemnity mutual association that provides coverage for protection and indemnity risks to vessel owning companies who join the Association. The Rules of the Association govern the insurance coverage and are developed and published outside of the United States. Negotiations with potential customers are handled by a broker. In this case, McGriff, Seibels Williams of Texas, Inc. negotiated the placement of cover with UK PI Club. If the UK PI Club accepts the risk, it issues a Certificate of Entry as evidence of the coverage provided to the ship owner and delivers it to the ship owner's broker. The UK PI Club issued Certificate of Entry, No. 278768 for the M/V MISS DEBBIE in London and delivered it to Odyssea Marine's broker, McGriff, Seibels Williams of Texas, Inc., in Houston, Texas.
II. ARGUMENTS OF THE PARTIES
A. Defendant's Arguments
Defendant, in arguing for Summary Judgment, asserts that a direct action can only be brought against an insurer when at least one of the prerequisites set out in La.R.S. 22:655(b)(2) has been met: (1) the accident occurred in Louisiana; (2) the policy was written in Louisiana; or (3) the policy was delivered in Louisiana. See Landry v. Travelers Indemnity Co., 890 F.2d 770, 772 (5th Cir. 1989). UK PI Club claims that in this case, none of these requirements have been met. Both parties agree that, as the accident occurred forty to fifty miles offshore, the accident did not occur in Louisiana. Also undisputed is that the PI policy was drafted by the UK PI Club in London, England. Further, it seems clear that as the policy was delivered to Odyssea Marine's broker, McGriff, Seibels Williams of Texas, Inc., in Houston, Texas, the State of Louisiana played no part in the delivery of said insurance policy.
Therefore, Defendant moves to dismiss Plaintiff's Complaint against it for failure to state a cause and/or right of action against it under the Louisiana Direct Action Statute.
B. Plaintiff's Arguments
Plaintiff asserts that Defendant has failed to address the reason that Summary Judgment should be denied: failure to pay maintenance and cure. Plaintiff claims that this matter also involves Defendant, UK PI Club's unreasonable failure and/or delay in paying maintenance and cure. Plaintiff relies on Hebert v. Aetna Casualty Surety Company, 400 So.2d 695 (La. 1st Cir. 1981), in claiming that when a seaman asserts a claim for failure to pay maintenance and cure on a claim administered in Louisiana. the act producing harm for purposes of LaR.S. 22:655 occurs in Louisiana. In Hebert, the court found that even though the three prerequisites for La.R.S. 22:655 were met, they did not need to be, as Aetna was liable as a tortfeasor independently. The court held:
Where act producing harm, or accident, was alleged to be capricious failure of employer and its insurer to provide seaman with maintenance and cure, alleged act took place in Louisiana where claim was administered and which was home base of insurer's representative who refused to continue paying maintenance and cure to seaman, and there was also claim for damages for aggravation of seaman's mental condition which could only have occurred in Louisiana, action against insurer was for act producing harm which occurred in state and met requisites of direct action statute. LSA-R.S. 22:655.Hebert , 400 So.2d at 698. In this case, Adams is a Louisiana resident whose condition worsened when UK PI Club discontinued maintenance and cure as in Hebert. Therefore, Adams filed suit for the failure to pay maintenance and cure. Plaintiff contends that Michael B. Harrison, Manager of Human Resource and Administration of Defendant, Odyssea Marine, explained in his deposition that defense counsel made all decisions concerning maintenance and cure. Plaintiff further claims that Mr. Harrison's testimony made it clear that he relied on advice from counsel concerning maintenance and cure decisions. As these attorneys are located in New Orleans, Louisiana, Plaintiff asserts that this testimony is sufficient to prove that the decision to delay and/or failure to pay maintenance and cure was made in Louisiana. For these reasons, Plaintiff claims UK PI Club's Motion for Summary Judgment should be denied.
III. LAW AND ANALYSIS
A. Law on Summary Judgment
Rule 56(c) of the Federal Rules of Civil Procedure provides that summary judgment should be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). "The party moving for summary judgment bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the record which it believes demonstrate the absence of a genuine issue of material fact." Stults v. Conoco, 76 F.3d 651 (5th Cir. 1996), (citing Skotak v. Tenneco Resins Inc., 953 F.2d 909, 9 12-13 (5th Cir.) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). When the moving party has carried its burden under Rule 56(c), its opponent must do more than simply show that there is some metaphysical doubt as to the material facts. The nonmoving party must come forward with "specific facts showing that there is a genuine issue for trial." Matsushita Elec. Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 588 (1986) (emphasis supplied); Tubacex. Inc. v. M/V Risan, 45 F.3d 951, 954 (5th Cir. 1995).
Thus, where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no "genuine issue for trial." Matsushita Elec. Industrial Co., 475 U.S. at 588. Finally, the Court notes that substantive law determines the materiality of facts and only "facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson v. Liberty Lobby Inc., 477 U.S. 242, 248 (1986).
B. Court's Analysis
Plaintiffs reliance on Hebert v. Aetna Casualty Surety Company, 400 So.2d 695 (La. 1st Cir. 1981) is misguided. The case cited by Plaintiff is the second of two related cases. In the first case, Hebert v. Diamond M. Co., 385 So.2d 410 (La.App. 1st Cir. 1980), the plaintiff sued his employer, Diamond M., for damages sustained by him as a seaman. Aetna, as the employer's insurer, intervened for maintenance and cure benefits it had already paid to plaintiff as a result of the injury. Judgment was entered in favor of the plaintiff and in favor of Aetna for the amount of maintenance and cure it had paid the plaintiff. Id. After trial, Aetna decided to stop paying the plaintiff maintenance and cure benefits. As a result, Hebert filed the second lawsuit which Plaintiff relies upon.
The Louisiana First Circuit court held that because the suit was one against Aetna as a tortfeasor, the requirements of the Direct Action Statute did not need to be met before plaintiff could sue Aetna directly. However, the circumstances of that case did provide the necessary prerequisites for the Direct Action Statute.
The alleged act took place in Louisiana where the claim was administered and which was the home base of the insurer's representative who refused to continue paying maintenance and cure to Hebert. There is also a claim for damages for aggravation of Hebert's mental condition which could only have occurred in Louisiana. This claim for capricious failure to pay maintenance is a distinct claim from the claim for injuries against Diamond M for its tort on the high seas. See Cortes v. Baltimore Insular Line, supra. The seaman's right to maintenance and cure is predicated upon the maritime employment contract and does not depend upon the seaman being able to establish fault or a tortious activity. Aguilar v. Standard Oil Co. of New Jersey, 318 U.S. 724, 63 S.Ct. 930, 87 L.Ed. 1107 (1943).
(Emphasis added.) Hebert, 400 So.2d at 698. Accordingly, the offending act, the failure to pay maintenance and cure, occurred in Louisiana, where the decision to terminate was made solely by Aetna's representative.
In this case, Adams claims that his suit against UK PI Club is analogous and should be allowed as it is against an insurer for a denial of maintenance and cure. However, the insurer, UK PI Club, was not the party responsible for deciding to terminate Plaintiffs maintenance and cure. The deposition testimony of Michael Harrison makes clear that the determination to discontinue maintenance and cure by Odyssea Marine was made by him based on the "advice from counsel" (Harrison Deposition, page 12, lines 10-14). While Plaintiff argues that the decision to terminate maintenance and cure was made solely in Louisiana by counsel for Odyssea Marine, there is no authority to support this view. The Court finds that the decision was made by Odyssea Marine, not UK PI Club, and that theHebert case is therefore not applicable. As maintenance and cure is predicated upon a maritime employment contract and not fault, a seaman's employer, in this case Odyssea Marine, is charged with the payment of applicable benefits. Hebert, 400 So.2d at 323432 (citing Aguilar v. Standard Oil Co. of New Jersey, 318 U.S. 724, 63 S.Ct. 930, 87 L.Ed. 1107 (1943)). Plaintiff has neither alleged that UK PI Club made the decision to terminate payments, nor sufficiently proven that anyone other than Odyssea Marine, through its agent in Houston, Texas, came to the decision to discontinue payment of maintenance and cure benefits.
Accordingly,
IT IS ORDERED that the Motion for Summary Judgment filed on behalf of the defendant, United Kingdom Mutual Steamship Assurance Association, be and the same is hereby GRANTED.