Otto Candies, Inc. v. Great American Insurance Company

221 F. Supp. 1014, 1963 U.S. Dist. LEXIS 7920
CourtDistrict Court, E.D. Louisiana
DecidedSeptember 30, 1963
DocketAdm. 4237
StatusPublished
Cited by11 cases

This text of 221 F. Supp. 1014 (Otto Candies, Inc. v. Great American Insurance Company) is published on Counsel Stack Legal Research, covering District Court, E.D. Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Otto Candies, Inc. v. Great American Insurance Company, 221 F. Supp. 1014, 1963 U.S. Dist. LEXIS 7920 (E.D. La. 1963).

Opinion

WEST, District Judge.

Libelant, Otto Candies, Inc., brings this-libel seeking recovery of certain alleged *1015 damages resulting from cargo loss and barge damage. Libelant, at the time of the loss in question, was a boat contractor who had chartered the Tug BETTY LOU from her owners, Ernest Moise and Harold Collins, and then entered into an agreement with Southeastern Drilling Corporation, who, at the time, was drilling an oil well in the Southeast Pass at the mouth of the Mississippi River .for Humble Oil & Refining Company, to furnish the use of the BETTY LOU to it for use in its drilling operations. The captain of the Tug BETTY LOU was Norbert Bruce. He was employed as captain of the tug by Moise and Collins. Respondent, Great American Insurance Company, insured the BETTY LOU in the amount of $20,000, and by endorsement to the policy, libelant became an additional assured. The policy covered the type of loss here involved. On December 31,1958, a loss occurred, both to cargo and to certain portions of the Barge HO&R 17, owned by Humble Oil & Refining Company, on which the cargo was stowed. A claim for damages in the amount of $11,928.66 was made by Humble against Southeastern, who in turn made claim against libelant for the same amount and at the same time, withheld monies owed by Southeastern to libel-ant in an amount approximately equal to the amount of Humble’s claim. Libelant reported the loss and claims to respondent who took the position that the loss was not occasioned by any negligence on the part of the BETTY LOU •or its crew, but at the same time assured the libelant that it would be protected under the policy and that it, respondent, would defend the claims made against libelant. Despite this assurance, libelant proceeded to settle the •claim by paying the sum of $8,000 to Humble Oil & Refining Company, and in return therefor, obtained an assignment of Humble’s claim. Libelant thus seeks to recover from respondent the amount paid by it in settlement of the •claim, plus interest, penalty and attorney fees, on the grounds that the loss was occasioned by the negligence of the Tug BETTY LOU, and that libelant is (1) an assured under the policy, and (2) the assignee of Humble’s claim. It is the position of respondent that first of all, the loss was not caused by any negligence on the part of the BETTY LOU or its crew, and secondly, that since it had notified libelant that it, respondent, would defend the claim, and that in any event, respondent was fully covered by the policy, libel-ant had no right to settle the claim without the consent of respondent, but that on the contrary, libelant was obligated to fully cooperate with the respondent in the defense of the claim.

While this Court has some doubts as to the right of libelant, under the circumstances of this case, to recover from respondent either as an assured or an assignee of Humble, nevertheless, whether it has such a right or not is immaterial in view of the fact that this Court concludes that the loss sued for was not occasioned by any negligence on the part of the BETTY LOU or its crew. In connection with this conclusion, the Court makes the following Findings of Fact and Conclusions of Law.

FINDINGS OF FACT

1.

The Tug BETTY LOU was approximately 50 feet long, 17 or 18 feet wide, and about 6% feet deep. She was powered by one 300 horsepower diesel engine, and was pilothouse controlled. The Barge HO&R 17 was a steel deck barge of conventional type, with rakes on each end, approximately 100 feet long, 30 feet wide, and 6 to 7 feet deep. On the deck of the barge was constructed a house for stowage of mud and chemicals. This house was 80 to 90 feet long, 20 feet wide, and 11 or 12 feet high, with a peaked roof. It was constructed by 2 x 4 risers or studding, enclosed with corrugated tin sheeting. The BETTY LOU was owned by Ernest Moise and Harold Collins, chartered to libelant, and furnished under contract by libelant to Southeastern Drilling Corporation to be used in connection with its oil drilling operations. The *1016 Barge HO&R 17 was owned by Humble Oil & Refining Company, for whom Southeastern was drilling a well at the time of the loss in question.

2.

On December 31, 1958, Captain Bruce, of the BETTY LOU, was instructed by Southeastern Drilling Corporation to take the HO&R 17 in tow and to proceed with it from the well site near Garden Island in the Southeast Pass at the mouth of the Mississippi River to the Mayronne dock in Venice, Louisiana, where it was to be loaded with drilling mud and chemicals. He was further instructed that immediately upon the loading of the barge, he was to return it as soon as possible to the well site.

3.

In compliance with these orders, the BETTY LOU took the HO&R 17 in tow, and arrived at the Mayronne dock at Venice, Louisiana, at about 5:00 o’clock a. m. on December 31, 1958. Upon arriving at the Mayronne dock, the barge was spotted and loaded with sacks of drilling mud and chemicals. These materials were contained in 50 pound and 100 pound sacks, stacked on pallets, and were then loaded in the house on the deck of the HO&R 17 by men working on the dock. This cargo was owned by Humble, as was the Barge PIO&R 17. The men who loaded the mud and chemicals on the barge were not working under the control or supervision of the captain or crew of the BETTY LOU, who had nothing whatsoever to do with the loading operation.

4.

The sacks of mud and chemicals were loaded from the deck to a height of about 11 feet inside the house, leaving only a 1 to 2 foot passageway from forward aft in the center of the barge. Thus, the cargo occupied the entire interior of the house on the deck of the barge, except for the space in the peak of the roof, and the narrow passageway along the center of the barge.

5.

After loading was completed, Captain Bruce went aboard the barge and checked all manholes and hatch covers to be sure they were watertight, and also checked and made sure that there was not list on the barge. He walked into the house and saw how the cargo was loaded. The sacks were not tied down, but he saw that they were loaded as hereinbefore described. He noted that the barge, at that time, had between 1 and 1% feet of free-board. While Captain Bruce did not know how many sacks were loaded on the barge, he did testify that there were approximatley 2,500 sacks of mud, not counting the sacks of chemicals.

6.

After ascertaining that the barge was apparently watertight, and that it was not listing to either side, he proceeded to make up to the barge by hipping the BETTY LOU up with her starboard side to the port side of the barge. The barge was made fast to the tug by the use of rope lines.

7.

As thus made up, the BETTY LOU, with her tow, left Venice, Louisiana, at about 5:00 o’clock p. m., December 31, 1958, entered the Mississippi River, and proceeded • downstream at about 3 to 4 miles per hour. Captain Bruce made no weather checks upon leaving Venice, but the weather at the time of his departure was fair and clear.

8.

At about 6:00 o’clock p. m., that evening, while proceeding down river, a thick fog set in which rose from the water up above the wheel house of the BETTY LOU.

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Cite This Page — Counsel Stack

Bluebook (online)
221 F. Supp. 1014, 1963 U.S. Dist. LEXIS 7920, Counsel Stack Legal Research, https://law.counselstack.com/opinion/otto-candies-inc-v-great-american-insurance-company-laed-1963.