Jordan v. Aries Marine Corporation et al

Filing 83

ORDER & REASONS denying 72 Motion for Summary Judgment. Signed by Judge Martin L.C. Feldman on 1/27/2016. (caa)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
WILLIAM JORDAN

CIVIL ACTION

V.

NO. 14-377

ARIES MARINE CORPORATION ET AL.

SECTION "F"

ORDER AND REASONS
Before

the

Court

is

William

Jordan

and

Aries

Marine

Corporation’s joint motion for summary judgment against Fab-Con,
Inc.

and

Signal

Mutual

Indemnity

Association,

Ltd.

For

the

following reasons, the motion is DENIED.
Background
This contract dispute arises from a marine personal injury
lawsuit. The question before the Court is whether the alleged
tortfeasor

must

reimburse

the

injured

rigger’s

employer

and

insurer for the benefits and medical expenses they have paid on
the rigger’s behalf.
William Jordan was employed as a rigger by Fab-Con, Inc. FabCon contracted with Energy XXI under a Master Service Agreement to
provide offshore construction. Fab-Con sent Jordan as a member of
a construction crew to work at Energy’s platform located off of
the coast of Louisiana. Jordan was injured in the course of his
employment on the offshore platform. Fab-Con’s insurer, Signal
Mutual Indemnity Association, Ltd., has compensated Jordan for his
injuries and has paid medical expenses on his behalf.

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Aries Marine also contracted with Energy. Aries chartered a
self-elevating

lift

boat

to

Energy

under

a

Blanket

Charter

Agreement. A crane was mounted onto Aries’ boat and used to lift
an exhaust stack over the offshore platform. Jordan and his crew
were

tasked

with

removing

a

valve

that

was

attached

to

the

suspended exhaust stack. During this maneuver, the exhaust stack
collapsed

and

injured

Jordan.

Aries

employees

were

allegedly

operating the boat and crane at the time of the incident.
Jordan

sued

Aries,

among

others,

contending

that

Aries’

negligent operation of the crane caused his injuries. Aries denies
liability. Fab-Con and Signal intervened in the lawsuit seeking
reimbursement from Aries for the amounts they paid for Jordan’s
compensation benefits and medical expenses. In this motion, Jordan
and Aries jointly seek to dismiss Fab-Con and Signal’s claims for
reimbursement from Aries.
This is a matter of contract interpretation. In the Master
Service Agreement (MSA) betwee Fab-Con and Energy, there is as
provision that states:
[Fab-Con] agrees to procure, maintain and amend, at its
sole
expense,
and
require
all
of
[Fab-Con’s]
subcontractors of every tier to procure, maintain and
amend at their sole expense, policies of insurance in
the amounts outlined on Exhibit “A”, attached hereto .
. . which coverage shall fully address the liabilities
assumed hereunder.
Exhibit A, which is attached to the Master Service Agreement,
provides minimum insurance coverages, limits, and amounts that
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Fab-Con must maintain under the Agreement. At the end of Exhibit
A, a final paragraph provides:
In addition to the above:
. . .
2. All insurance policies shall contain the provision
that the insurance companies endorse their policies to
provide a waiver of subrogation in favor of ENERGY XXI
Services, LLC, its parent, subsidiaries, joint ventures,
agents,
servants,
invitees,
employees,
officers,
directors, co-lessees and affiliated companies.
Relying on this provision in Exhibit A, Jordan and Aries contend
that Fab-Con was required to waive its right of subrogation against
Aries because Aries was Energy’s “invitee.” Critical to this
dispute is whether the above provision in Exhibit A is actually a
part of the MSA between Fab-Con and Energy. The Court finds that
the answer is no.1
I.
Federal Rule of Civil Procedure 56 instructs that summary
judgment is proper if the record discloses no genuine dispute as
to any material fact such that the moving party is entitled to
judgment as a matter of law. No genuine dispute of fact exists if
the record taken as a whole could not lead a rational trier of

Jordan and Aries presume that the language in Exhibit A is a part
of the MSA. Thus, they focus their motion primarily on arguing
that Aries was Energy’s “invitee.” Because the Court finds that
the relevant language in Exhibit A is not a part of the MSA, it
does not address whether Aries qualifies as an “invitee” under the
legal definition.
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fact to find for the non-moving party. See Matsushita Elec. Indus.
Co. v. Zenith Radio., 475 U.S. 574, 586 (1986). A genuine dispute
of fact exists only "if the evidence is such that a reasonable
jury could return a verdict for the non-moving party." Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
The Court emphasizes that the mere argued existence of a
factual dispute does not defeat an otherwise properly supported
motion. See id. Therefore, "[i]f the evidence is merely colorable,
or

is

not

significantly

probative,"

summary

judgment

is

appropriate. Id. at 249-50 (citations omitted). Summary judgment
is also proper if the party opposing the motion fails to establish
an essential element of his case. See Celotex Corp. v. Catrett,
477 U.S. 317, 322-23 (1986).

In this regard, the non-moving party

must do more than simply deny the allegations raised by the moving
party. See Donaghey v. Ocean Drilling & Exploration Co., 974 F.2d
646, 649 (5th Cir. 1992). Rather, he must come forward with
competent evidence, such as affidavits or depositions, to buttress
his claim. Id. Hearsay evidence and unsworn documents that cannot
be presented in a form that would be admissible in evidence at
trial do not qualify as competent opposing evidence.

Martin v.

John W. Stone Oil Distrib., Inc., 819 F.2d 547, 549 (5th Cir.
1987); Fed. R. Civ. P. 56(c)(2).

Finally, in evaluating the

summary judgment motion, the Court must read the facts in the light

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most favorable to the non-moving party.

Anderson, 477 U.S. at

255.
II.
Louisiana law governs the Master Service Agreement. The Outer
Continental Shelf Land Act provides:
“the civil and criminal laws of each adjacent State .
. . are hereby declared to be the law of the United
States for that portion of the subsoil and seabed of the
outer Continental Shelf, and artificial islands and
fixed structures erected thereon, which would be within
the area of the State if its boundaries were extended
seaward to the outer margin of the outer Continental
Shelf . . . .”
43 U.S.C. § 1333(a)(2)(A). A contractual dispute “arises on an
OSCLA situs if a majority of the performance called for under the
contract is to be performed on stationary platforms or other OCSLA
situses enumerated in 43 U.S.C. § 1333(a)(2)(A). See Grand Isle
Shipyard, Inc. v. Seacor Marine, LLC, 589 F.3d 778 (5th Cir. 2009).
Here, the majority of the work under the MSA was to be performed
on a stationary platform on the outer Continental Shelf off of the
coast

of

Louisiana.

Thus,

the

Louisiana

rules

for

contract

interpretation control.
Under Louisiana law, “[i]nterpretation of a contract is the
determination of the common intent of the parties.” La. Civ. Code
art. 2045. “When the words of a contract are clear and explicit
and lead to no absurd consequences, no further interpretation may
be made in search of the parties’ intent.” La. Civ. Code art. 2046.

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“The words of a contract must be given their generally prevailing
meaning.” La. Civ. Code art. 2047. “Each provision in a contract
must be interpreted in light of the other provisions so that each
is given the meaning suggested by the contract as a whole.” La.
Civ. Code art. 2050.
III.
The outcome of this dispute depends upon whether the final
paragraph in Exhibit A, which requires Fab-Con to waive its
subrogation rights against Energy’s “invitees,” is a part of the
Master Service Agreement. Thus, the Court turns to the language in
the MSA that references Exhibit A.
The MSA provides: “[Fab-Con] agrees to procure, maintain and
amend . . . policies of insurance in the amounts outlined on
Exhibit “A”, attached hereto . . . .” (emphasis added). Exhibit A
is a two-page document that lists different kinds of insurance
policies and the minimum amounts of coverage required for each.
Following the list of insurance amounts, there is a final paragraph
that lists additional insurance requirements, including waiver of
subrogation in favor of Energy’s invitees. There are no signatures
on Exhibit A.2 More importantly, nowhere does the MSA incorporate
Exhibit A into the agreement. Rather, the plain language of the
MSA indicates that the only provisions of Exhibit A that are

To the contrary, Exhibits “B” and “C” both have signature lines.
The Court notes, however, that neither are signed.
2

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relevant to the parties’ agreement are the amounts outlined.
Binding Fab-Con to the fine print provisions at the end of Exhibit
A, none of which outline amounts of insurance coverage, would be
to diverge from the clear and explicit language of the MSA.
Further evidence that the waiver provisions in Exhibit A are
not a part of the Agreement is that the MSA already covers waiver
of subrogation rights. In the same paragraph that references
Exhibit A, the MSA provides, “Said policies shall further . . .
waive the underwriters’ rights of subrogation in favor of ENERGY
XXI, its co-lessees or joint venturers.” There is no mention of
waiver in favor of “invitees” in the MSA’s provisions. To conclude
that an extraneous provision of a referenced exhibit trumps the
explicit provisions of the MSA is untenable.
The final evidence of the parties’ intent to be bound by the
waiver provision in the MSA instead of the waiver provision in
Exhibit A is the language from the checklist forms that Energy
required Fab-Con to execute. The MSA provides:
[Fab-Con]
by ENERGY
fact that
shall be
furnished

shall furnish to ENERGY XXI, on forms supplied
XXI, certificates of insurance evidencing the
proper insurance has been secured and no work
commenced unless the certificates have been
to and are on file with ENERGY XXI.

The form presented by Energy did not require Fab-Con to waive
subrogation against invitees. Instead, the form asks, “Do all
policies contain waiver of subrogation in favor [of] Energy XXI
Services, LLC, its parent, subsidiaries, and affiliates?” This
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language is consistent with the waiver requirements in the MSA.
Moreover, Energy was satisfied with the insurance policies that
Fab-Con

secured,

and

it

permitted

Fab-Con

to

commence

work

ostensibly under the impression that Fab-Con had only waived
subrogation in favor of Energy, its parent, subsidiaries, and
affiliates.
Jordan and Aries have failed to prove that the provision in
Exhibit A requiring waiver of subrogation in favor of Energy’s
invitees was intended to be incorporated into the Agreement. The
plain language of the MSA indicates the opposite.
Accordingly, Jordan and Aries’ motion for summary judgment
against Fab-Con and Signal is DENIED.
New Orleans, Louisiana, January 27, 2016
______________________________
MARTIN L. C. FELDMAN
UNITED STATES DISTRICT JUDGE

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