Cargill, Inc. v. Great American Insurance Co.

126 So. 2d 368, 1960 La. App. LEXIS 1342
CourtLouisiana Court of Appeal
DecidedDecember 1, 1960
DocketNo. 9335
StatusPublished
Cited by2 cases

This text of 126 So. 2d 368 (Cargill, Inc. v. Great American Insurance Co.) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cargill, Inc. v. Great American Insurance Co., 126 So. 2d 368, 1960 La. App. LEXIS 1342 (La. Ct. App. 1960).

Opinion

BOLIN,. Judge.

Cargill, Inc., a Delaware Corporation and Friedman Pipe and Steel Company, a partnership organized under the laws of the State of Texas, jointly sued Great American Indemnity Company, liability insurer of Foster Lee, Jr., and predecessor to the named defendant, for the sum of $8,935. This amount represented the alleged damage caused to a steel storage tank by the negligence of Foster Lee, Jr., in removing pipe from the tanks and causing an explosion on July 17, 1957.

The record shows that prior to the accident, Friedman Pipe and Steel Company granted a surface lease to Cargill, Inc., on the land upon which the tank farm was located. The agreement further granted Cargill the right and option to purchase the real estate but reserved to Friedman one hundred twenty days (120) from the exercise of the option within which to remove any pipe and fittings appertaining to the tank farm. Additionally, it was agreed that Cargill was to buy fourteen of the storage tanks located on the property, being those numbered nine through twenty-two inclusive. $50,000 of the purchase price of $125,000 was paid and the balance was to be due “upon approval of title to the said' tanks by Cargill’s attorneys and execution and delivery of deed thereto acceptable to said .attorneys.” Thirty days were granted for such an examination of the title.

Cargill was interested in the tanks for use in storing grain. As these tanks had formerly contained petroleum products, it was necessary that the sediment .and water be removed and they be thoroughly cleaned. This sediment had a resale value and Car-gill sold it to Hill Brothers, which was to remove the sediment so that the tanks could be cleaned by a concern known as the “M System”.

Cargill, prior to July 17, 1957, proceeded with the process of preparing the tanks for grain storage. Under a contract with the Friedman Group, Foster Lee, Jr., was [370]*370engaged in cutting and removing the pipe system by means of an acetylene torch.

A few days prior to the accident with which we are concerned, a small explosion or “backfire” occurred in connection with the removal of pipe from another tank. Fortunately no damage was done, and the workers inside the tank at the time were uninjured. Thereupon, for the safety of all concerned, Mr. Chrisner, a supervisor for Cargill, told Lee not to “cut inside the valve” unless he had received specific instructions to do so which would be given only after the tank had been cleaned and the workers had been cleared from the area. The accident resulted when Lee began cutting pipe leading into tank number nine before the tank had been cleaned, an4 without instructions that it was safe to so proceed. There is no controversy that the explosion was caused by the torch being used by Lee and that the damage to the tank resulted from the explosion and fire that followed.

Following the explosion and resulting damage, the transaction between Friedman Pipe and Steel Company and Cargill, Inc. was completed and the Friedman Group was paid the full price agreed on with no diminution because of the damage. The tank was repaired at the expense of Car-gill, Inc., and the amount expended in that effort, plus a sum for the loss of its use, is the sum sued for herein.

Defendant filed an exception of no right and no cause of action which was overruled by the court below and, at the trial on the merits, the judgment was in favor of plaintiff, Cargill, Inc., for the sum of $8,-935, it being admitted by the Friedman Group that any judgment so rendered should be in favor of Cargill, Inc.

The defendant appealed from the judgment, and both plaintiffs also perfected de-volutive appeals as precautionary measures. Defendant first contends that its insured was not negligent in the conduct of his operations which led to the accident. Secondly, assuming negligence, defendant again urges the exceptions of no cause and no right of action.

In order to correctly dispose of the first issue, it is necessary to examine more closely the physical setting of the area in which the accident occurred. The steel storage tank was surrounded by an earthen fire wall which was designed to restrain the oil in event the tank broke or a leak occurred. The main oil trunk line was outside this fire wall and was connected to all the tanks in the farm and was used to fill the tanks and to remove the oil therefrom as needed. There were two ten inch lines which ran from the trunk line to the tank itself. These two lines were approximately five feet apart and were more or less parallel, with a cut-off valve which was outside the fire wall and at about the point where they connected with the trunk line. One line was an intake line and the other an output line and both lines entered the tank near the base. The tank had a concrete floor which came up about eighteen inches on the tank wall and sloped downward to the center where there was a depression called a “sump pit”. The output line went down into the sump pit and the intake line went up and was movable. This was to allow the end of this line to be above the level of oil in the tank when oil was being pumped into the tank from the trunk line. It was this line that was being cut when the explosion occurred.

At the time of the accident, the rivets securing the door plate had been cut but had not been punched through and, for all practical purposes, the tank was still intact.

Lee testified that he thought the tank was empty of fluid and was reassured, so he testified, when he cut the first pipe and no oil ran out. He further testified that he knew the tank had not been steamed (the final step in cleaning) and that he had not been given any instructions to proceed by Mr. Chrisner.

It is apparent that the pipe first cut was the output line which ended in the sump pit and in which no gases could accumulate. [371]*371The second line cut was the intake line and since it ended above the level of the sediment, gases did accumulate therein and it was these gases which exploded when ignited by the cutting torch.

The defendant denies that its insured was negligent because the method used in removing the pipe was an accepted practice among those engaged in that endeavor and, also, that the violation of the instructions of Chrisner was not a factor as Lee owed no duty to Chrisner.

The first defense to the plea of negligence is based on the principle that ordinary care is exercised when one complies with the custom and usage of others engaged in the same activity. However, the practice which caused the damage here had resulted in explosions of one degree or another many times before and Lee, himself, testified that he had heard of, and encountered several, while he was in this occupation. Additionally he had experienced a similar, though less severe, explosion only a few days before on this same job.

It was said in Harris Drilling Company v. Delafield, 1952, 222 La. 416, 62 So.2d 627, 629:

“Custom and usage may be regarded as a matter proper for consideration in determining whether or not sufficient care has been exercised in a particular case, but it is not conclusive or controlling, for the customary way of doing a thing may be a negligent way and may create a false standard of care, and, once negligence is established, such negligence cannot be justified by custom.”

When the act is obviously dangerous, as was the case here, proof that others are similarly careless is of no avail.

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126 So. 2d 368, 1960 La. App. LEXIS 1342, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cargill-inc-v-great-american-insurance-co-lactapp-1960.