Smith v. Chevron Oil Co.

517 F.2d 1154, 1975 A.M.C. 2295
CourtCourt of Appeals for the Fifth Circuit
DecidedAugust 22, 1975
DocketNo. 74-1364
StatusPublished
Cited by12 cases

This text of 517 F.2d 1154 (Smith v. Chevron Oil Co.) 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
Smith v. Chevron Oil Co., 517 F.2d 1154, 1975 A.M.C. 2295 (5th Cir. 1975).

Opinion

RONEY, Circuit Judge:

As with the two other cases involving Chevron Oil Company decided today, Chevron Oil Co. v. E. D. Walton Construction Co., 517 F.2d 1119 (5th Cir. 1975) and Stephens v. Chevron Oil Co., 517 F.2d 1123 (5th Cir. 1975) the central issue in this case involves the interpretation of an indemnification agreement between Chevron and an independent contractor. Concluding that Chevron’s negligence was the sole proximate cause of the injuries suffered by plaintiff Smith, the district court rendered judgment' against Chevron for $79,976.51 and dismissed Chevron’s third-party claim for indemnification and reimbursement against Ocean Sciences, Inc., Smith’s employer, an independent contractor hired by Chevron. On this appeal the several parties raise multiple challenges to the district court’s disposition of the case, only one of which warrants extended discussion. Chevron argues that even assuming its agreement with Ocean Sciences does not require the contractor to indemnify Chevron against the claim of the contractor’s employees for personal injuries caused solely by Chevron’s own negligence, Chevron is still entitled to reimbursement for its costs of defending the employee’s claim. We find no merit to Chevron’s arguments on appeal, including its contention that it is entitled to costs reimbursement under these circumstances, and affirm the district court’s decision in all respects.

I.

Ocean Sciences, Inc. was employed by Chevron Oil Company as an independent contractor to perform certain work on Chevron’s offshore platforms in the Gulf of Mexico. Richard O. Smith, one of Ocean Sciences’ employees, served as foreman of a crew of welders and laborers doing offshore work for Chevron. On March 16, 1970, Smith and his crew were transported to a Chevron offshore platform by the M/V STACEY TIDE. This vessel is an offshore supply boat owned by Tidewater Guardians, Inc., bareboat chartered by Chevron, and operated by Tidex, Inc. In order to transfer from the vessel to the platform, Smith and his men were required to swing on a rope from the boat to the [1156]*1156platform. The rope, which was attached to the platform and knotted at 12 to 18 inch intervals, was covered with oil as a result of a fire and blowout approximately one month previously.

Smith advised his co-workers to remove their work gloves to secure a firmer grip on the slippery rope. After Smith and several other men had transferred safely to the catwalk on the platform, one of the employees lost his grip on the rope and fell into the Gulf of Mexico between the boat and the catwalk. Smith threw himself down on the catwalk and reached with one hand to pull the man from the water. In so rescuing his co-worker, Smith seriously injured his back.

Smith filed suit against Chevron in district court for the negligent maintenance of an oily swing rope. Chevron, pursuant to its contract with Ocean Sciences, tendered the defense to and sought indemnity from Ocean Sciences and its insurer, United States Fidelity and Guaranty Company. In pertinent part, the indemnity agreement between Chevron and Ocean Sciences provides:

Contractor [Ocean Sciences] agrees to defend and hold Company [Chevron] indemnified and harmless from and against any loss, expense, claim or demand for:
(a) Injury to or death of Contractor’s employees or for damage to or loss of Contractor’s property in any way arising out of or connected with the performance by Contractor of services hereunder.

Ocean Sciences refused to defend or indemnify Chevron against Smith’s claim. Chevron, therefore, filed a third-party suit for indemnification and reimbursement against Ocean Sciences and its insurer.

Smith also filed suit in the district court against Tidewater Guardians, Inc., the owner of the M/V STACEY TIDE, and Tidex, Inc., the operator of the vessel for negligently operating the vessel when discharging plaintiff and his fellow employees. This action was consolidated with Smith’s suit against Chevron for trial.

The district court, sitting without a jury, found that Chevron, knowing of the dangers of the oil-slick rope, was negligent in failing either to warn, to provide an alternative means of access to the platform, or to insist on other safety precautions. The court further found that Chevron’s negligence was the sole proximate cause of Smith’s injuries and that Smith was not contributorily negligent. Concluding that Chevron was liable to Smith under the Outer Continental Shelf Lands Act, 43 U.S.C.A. § 1331 et seq., the district court entered judgment against Chevron for $79,976.51. The court dismissed Chevron’s third-party claim with prejudice on the basis that the indemnity agreement was not one in which Ocean Sciences agreed to indemnify Chevron for its own negligence. The district court also dismissed Smith’s complaint against Tidewater Guardians and Tidex with prejudice.

II.

Most of the issues presented for review in this case can be disposed of in summary fashion. The contention that the proscriptions of the Louisiana workmen’s compensation scheme, La.Rev.Stat. Ann. § 23:1032 and § 23:1061, foreclose Smith’s cause of action against Chevron has been adequately answered in a well-reasoned but unpublished opinion by the district court in denying Chevron’s motion for summary judgment. Since the district court found the accident occurred on a fixed platform on the Outer Continental Shelf, see 43 U.S.C.A. § 1331 et seq., Smith’s exclusive remedy was under the Longshoremen’s and Harbor Workers’ Compensation Act, 33 U.S.C.A. § 901 et seq., and not the Louisiana Workmen’s Compensation Act. See Nations v. Morris, 483 F.2d 577 (5th Cir.), cert. denied, 414 U.S. 1071, 94 S.Ct. 584, 38 L.Ed.2d 477 (1973); Strange v. Fidelity & Casualty Co., 262 So.2d 799 (La.Ct.App.1972). The Longshoremen’s Act does not preclude this action.

[1157]*1157On appeal Chevron has argued that the location of the platform, whether within or without Louisiana territorial waters, has not been definitely decided but is the subject of a litigated claim by the State of Louisiana against the United States in the Supreme Court. This litigation has now been concluded, United States v. Louisiana, -U.S. -, 95 S.Ct. 2022, 44 L.Ed.2d 652 (1975), but we are unable to determine from the record and briefs whether the offshore platform involved in this case is now considered in state territorial waters or is located on the Outer Continental Shelf. Furthermore, we have received no supplemental briefs from counsel concerning the effect of the Supreme Court’s decision on this case. Under these circumstances, we cannot say that the district court’s determination that the Outer Continental Shelf Lands Act is controlling is erroneous. We find no reversible error in the determination that Louisiana workmen’s compensation scheme does not apply to prevent Smith’s action against Chevron, contrary to Chevron’s argument.

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Bluebook (online)
517 F.2d 1154, 1975 A.M.C. 2295, Counsel Stack Legal Research, https://law.counselstack.com/opinion/smith-v-chevron-oil-co-ca5-1975.