Jackson v. Specialty Rental Tools & Supply, L.L.P.

879 F.3d 568
CourtCourt of Appeals for the Fifth Circuit
DecidedJanuary 8, 2018
DocketNo. 16-30217
StatusPublished
Cited by33 cases

This text of 879 F.3d 568 (Jackson v. Specialty Rental Tools & Supply, L.L.P.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Jackson v. Specialty Rental Tools & Supply, L.L.P., 879 F.3d 568 (5th Cir. 2018).

Opinion

W. EUGENE DAVIS, Circuit Judge.

We took this case en banc to consider modifying the criteria set forth in Davis & Sons, Inc. v. Gulf Oil Corp. for determining whether a contract for performance of specialty services to facilitate the drilling or production of oil or gas on navigable waters is maritime.1 After briefing and argument, the Court has decided to adopt a simpler, more straightforward test consistent with the Supreme Court’s decision in Norfolk Southern Railway Co. v. Kirby for making this determination.2

I. BACKGROUND

On October 12, 2005, Apache Corporation (“Apache”) entered into a blanket master services contract (“MSC”) with Specialty Rental Tools & Supply, L.L.P. (“STS”). The MSC included an indemnity provision running in favor of Apache and its contractors.3 In early 2011, Apache issued an oral work order' directing STS to perform “flow-back” services onp a gas well in navigable waters in Louisiana in order to remove obstructions hampering the well’s flow. A stationary production platform provided the only access to the gas well. The work order did not require a vessel, and neither Apache nór STS anticipated that a vessel would be necessary to perform the job.

On February 24, 2011, STS dispatched a two-man crew to perform the work required by the work order. After an unsuccessful day of work, the STS crew determined that some heavy equipment was' needed to complete the job and that a crane would be required to lift the equipment into place. Because the production platform was too small to accommodate a crane, the crew suggested to Apache that it engage a barge equipped with, a crane to lift the equipment. Apache agreed and contracted with Plaintiff Larry Doiron, Inc. (“LDI”), to provide a crane barge.

The next day, the LDI crew proceeded to the job site on the crane barge POGO and unloaded the equipment requested by the STS crew. After being unsuccessful, however, the STS crew discoveréd that it needed yet a different piece of equipment, so, with the aid of the crane, both crews began removing the heavy equipment previously unloaded. During this process, the LDI crane operator struck and injured one of the STS crewmembers, Peter Savoie, with the equipment.

Anticipating a claim from Mr. Savoie, LDI filed a limitation of liability proceeding as owner of the crane barge POGO. Savoie filed a claim in the limitation proceeding. LDI, as Apache’s contractor, then filed a third-party complaint against STS, seeking indemnity under the terms of the MSC.

LDI filed a motion for summary judgment seeking a declaration that it was entitled to indemnity from STS under the MSC. STS filed a cross-motion for summary judgment seeking a determination that it owed no indemnity. The -narrow issue presented was whether the MSC was a maritime contract. If1 so, general maritime law permitted enforcement of the indemnity provision. If not, Louisiana law controlled, and the Louisiana1 Oilfield Indemnity Act (“LOLA”) precluded indemnity.4 The' district court concluded that maritime law applied and awarded LDI indemnity from STS. Our panel affirmed that judgment on appeal. A majority of the active judges then voted to take the case en banc.

II. DISCUSSION

A. Standard of Review

We review de novo a district court’s grant of summary judgment.5 Summary judgment is proper “if the movant shows that there-is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.’’6 A genuine, dispute exists if a reasonable jury could find in favor of the nonmoving party.7 All facts and evidence are viewed in the light most favorable to the nonmovant.8 We turn first to the existing law on maritime contracts in this circuit.

B. Current Law

The issue in this case is whether the Court should apply maritime law or Louisiana law to determine the validity of the indemnity provisions in the MSC. If Louisiana law applies, the indemnity agreement is void as against public-policy.9 If, on the other hand, the contract is maritime and state law does not apply, then the indemnity obligation is enforceable.10

Our cases in this area have long been confusing and difficult to apply. In Thurmond v. Delta Well Surveyors, Judge Garwood stated in his concurring opinion that he was “generally in agreement with Judge Wisdom’s persuasive opinion, but ... troubled by the tension, or perhaps outright inconsistency, between many of our opinions in this area.” 11 He elaborated that:

[I]t seems to me that it may be desirable to consider this issue en banc, in order that we may take a more' consistent approach to the question of whether and in what circumstances activities in connection with mineral development in state territorial waters are maritime (or perhaps “maritime and local[.]”) ]12

Since 1990, we have followed the multi-factor test set forth in Davis & Sons, Inc. v. Gulf Oil Corp„ (“Davis & Sons”) to determine whether a contract is a maritime contract.13 Judge Rubin, in attempting to summarize and make sense of our case law, set'forth numerous guiding principles:

If ... the contract consists of two parts, a blanket contract followed by later work orders, the two must be interpreted together in evaluating whether maritime or land law is applicable to the interpretation and enforceability of the contract’s provisions. The blanket' contract is not of itself Complete and calls for no specific work. The actual contract between the parties therefore consists of the blanket agreement as modified by the later work order.14

He stated further:,

A contract may either contain both maritime and non-maritime obligations.... If separable maritime obligations are imposed ..., these are maritime obligations that can be separately enforced in admiralty without prejudice to the rest, hence subject to maritime law.15
Whether the blanket agreement and work orders, read together, do or do not constitute a maritime contract depends, as does the characterization of any other contract, on the nature and character of the contract, rather than on its place of execution or performance. A contract relating to a ship in its use as such, or to commerce or navigation on navigable waters, or to transportation by sea or to maritime employment is subject to maritime law. What, constitutes maritime character is not determinable by rubric. The Supreme Court has resorted to the observation that a contract is maritime if it has a genuinely salty flavor.16

He concluded his synopsis by distilling these principles into the six-factor test at issue in this appeal:

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Bluebook (online)
879 F.3d 568, Counsel Stack Legal Research, https://law.counselstack.com/opinion/jackson-v-specialty-rental-tools-supply-llp-ca5-2018.