LeBlanc v. Petroleum Equipment Tools Co.

489 F. Supp. 488, 1980 U.S. Dist. LEXIS 9282
CourtDistrict Court, W.D. Louisiana
DecidedFebruary 20, 1980
DocketCiv. A. No. 76-6536
StatusPublished
Cited by1 cases

This text of 489 F. Supp. 488 (LeBlanc v. Petroleum Equipment Tools Co.) is published on Counsel Stack Legal Research, covering District Court, W.D. Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
LeBlanc v. Petroleum Equipment Tools Co., 489 F. Supp. 488, 1980 U.S. Dist. LEXIS 9282 (W.D. La. 1980).

Opinion

MEMORANDUM OPINION

PUTNAM, Senior District Judge.

Plaintiff, Donnie LeBlanc, brought suit against Atlantic Richfield Company (ARCO), Petroleum Equipment and Tools Company (PETCO), and B. J. Hughes (Hughes) for a hand injury he sustained while working on a fixed platform in the Gulf of Mexico off the Louisiana Coast. The injury occurred while he was operating a set of power tongs on a drilling platform on the outer continental shelf. Hughes manufactured the tongs; PETCO owned them and leased them to ARCO, the owner of the platform. Plaintiff’s employer, Atlantic Pacific Marine Corporation (Atlantic Pacific), had contracted to drill one or more wells in search of oil and other minerals from the platform in question.1

Plaintiff received compensation benefits from Atlantic Pacific’s .insurer, American Home Assurance Company (American Home), in the amount of $18,615.88, under the Longshoremen’s and Harbor Workers’ Compensation Act, 33 U.S.C. § 901 et seq. American Home intervened to recover benefits paid by it, pursuant to 33 U.S.C. § 933. Plaintiff has now settled with ARCO, PET-CO, and Hughes for $50,000.00 with each defendant contributing one-third. Left to be decided is the amount, if any, that intervenor is entitled to receive out of the proceeds of the settlement.

The dispute between the plaintiff and intervenor stems from the agreement between Atlantic Pacific and ARCO.2 Under the terms of the contract, Atlantic Pacific [490]*490was to secure a waiver of subrogation in favor of ARCO in all policies of insurance carried by it, as to any acts or omissions in connection with the work covered by the contract. The following endorsement was obtained from American Home to effect this purpose:

“The company, in the event of payment under this policy, waives its rights of subrogation against any individual, firm or corporation for whom the Named Insured may be working, but this waiver shall apply only in respect to the specific contract existing, between the Named Insured and such other individual, firm or corporation and shall not be construed to be a waiver in respect of other operations of such individual, firm or corporation in which the insured has no contractual interest.”

Plaintiff LeBlanc contends that this waiver as to ARCO also waives intervenor’s right of subrogation as to PETCO and Hughes, or at least has the effect of reducing intervenor’s claim by one-third.

Plaintiff relies on Allen v. Texaco, 510 F.2d 977 (5 Cir. 1975) and Louisiana Civil Code Article 2203,3 applied here as surrogate federal law, Rodrigue v. Aetna Casualty & Surety Co., 395 U.S. 352, 89 S.Ct. 1835, 23 L.Ed.2d 360 (1969), in support of his position. The argument is that, under Allen, the waiver of subrogation does not contain a reservation of rights against the other defendants; therefore, Article 2203 operates to discharge the remaining debtors in solido, so that they owe nothing to American Home under 33 U.S.C.A. § 933.

In Allen v. Texaco, supra, the Fifth Circuit held that the equitable lien given to the compensation carrier on the proceeds of any settlement by an injured longshoreman with a third party tort feasor, is based on the right of subrogation granted by 33 U.S.C. § 933(h) and does not exist without it. Thus, when a compensation carrier waives its right of subrogation against a third party the carrier’s lien on the plaintiff’s recovery from that third party is also waived. Allen dictates here that American Home has waived its right of subrogation as to defendant ARCO and therefore cannot claim a lien on the proceeds of the settlement paid by that company.

Article 2203 of the Louisiana Civil Code of 1870 does not prohibit American Home’s recovery against the proceeds paid by PETCO and Hughes, however. This code article requires that when a creditor releases one debtor in solido, the creditor must reserve its rights against the remaining co-debtors in solido, or they are also released. They are each bound for the whole of the debt and are representatives of each other in their dealings with the creditor in regard to the common debt. Only one obligation exists in favor of the creditor, and if any one of the co-debtors negotiates a settlement or payment of the debt, it inures to the benefit of the others. If the creditor wishes to release one co-debtor without discharging the others, he must make this intention known by reserving his rights against the others, making it clear that his release of one debtor is restricted to that particular person and does not extend to the others.4

The instant case does not fall within the scheme of Article 2203, supra. The solidary obligation here arises out of the defendants’ relationship as joint tort feasors, a relationship that could not have existed prior to the tort. The waiver by American Home was executed before the injury to LeBlanc. At that time, no solidary debt and no mandatory relationship existed among the defendants and American Home had no one [491]*491against whom it could have reserved any rights. While ARCO may have been found to be a joint tort feasor as to plaintiff and liable in solido for the whole debt because of the pre-tort waiver of subrogation, it has no obligation to reimburse American Home. As between it and the remaining tort feasors (assuming they are such), however, ARCO is still liable for its one-third of the total debt. If we allow full recovery of the amount of benefits paid to plaintiff from PETCO and Hughes, we would permit American Home to do indirectly what it cannot do directly, for the obligation of ARCO to respond for its virile share of the debt is not affected by its contract with plaintiffs employer, Atlantic Pacific and its insurer.

But we cannot now decide this case. In our study of the record, the lease of the offending power tongs by PETCO requires ARCO to indemnify and hold it harmless from any liability resulting from the use of the tongs. No mention of this contract is made in the briefs or in the stipulation submitting the matter. The lease was filed on October 30, 1979, in response to plaintiff’s request for production of documents. Moreover, Mitchell v. Scheepvaart, etc., 579 F.2d 1274 (5 Cir. 1978), unequivocally requires that plaintiff’s claim for attorney’s fees be further documented on aquantum meruit basis.

For the foregoing reasons, we have requested and now order that both sides submit briefs within ten (10) days of this date on the following questions:

1. Does the indemnity agreement between ARCO and PETCO fall within the waiver of subrogation in the American Home policy issued in this ease, so as to deny recovery by American of any reimbursement of payments from the settlement between PETCO and plaintiff LeBlanc?
2.

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Bluebook (online)
489 F. Supp. 488, 1980 U.S. Dist. LEXIS 9282, Counsel Stack Legal Research, https://law.counselstack.com/opinion/leblanc-v-petroleum-equipment-tools-co-lawd-1980.