48 F.3d 913 (5th Cir. 1995), 94-30250, Phillips Petroleum Co. v. Best Oilfield Services, Inc.

Docket Nº:94-30250.
Citation:48 F.3d 913
Party Name:PHILLIPS PETROLEUM COMPANY, Plaintiff-Appellee, v. BEST OILFIELD SERVICES, INC., Defendant-Appellant.
Case Date:April 04, 1995
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit
 
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48 F.3d 913 (5th Cir. 1995)

PHILLIPS PETROLEUM COMPANY, Plaintiff-Appellee,

v.

BEST OILFIELD SERVICES, INC., Defendant-Appellant.

No. 94-30250.

United States Court of Appeals, Fifth Circuit

April 4, 1995

Page 914

Albert J. Derbes, III, Albert J. Derbes, IV, Jon A. Majewski, Metairie, LA, for appellant.

David M. Culpepper, Omar F. Kuebel, III, Draper & Culpepper, New Orleans, for appellee.

Appeal from the United States District Court for the Eastern District of Louisiana.

Before REAVLEY, DUHE and PARKER, Circuit Judges.

DUHE, Circuit Judge:

Best Oilfield Services, Inc. (Best) appeals the district court's judgment in favor of Phillips Petroleum Company (Phillips). Phillips asserted three liens against Best's workover rig and sought to recover damages for breach of contract and indemnity. The district court held all three liens valid against Best's rig. On appeal, Best maintains that the liens are invalid because of prescription, inadequate description of the leased premises and wells, and confusion. We affirm in part and reverse in part and remand.

BACKGROUND

Best contracted with Phillips to perform workover services on certain oil wells located on property Phillips leases in the Bastian Bay Field, Plaquemines Parish, Louisiana. The contract contained an indemnity provision which required Best to pay all suppliers' claims, allow no lien to be placed on the wells, and hold Phillips harmless against any claims or liens. Pursuant to a letter agreement dated October 4, 1991 that extended the contract, Best's rig performed workover services on the Fasterling B No. 1 and Fasterling No. 3 wells and converted the LL & E Fee 9 No. 10 well into a saltwater disposal well. Best's rig left the Field before December 6, 1991. Phillips then paid Best in full.

Best, however, did not pay three of its suppliers. Best owed $32,830 to Diamond "B" Marine Services, Inc. (Diamond), which supplied crew boats to Best. It owed $63,251.12 to T.L.C. Marine Services, Inc. (TLC), which provided towing and barging services to Best. Lastly, it owed $21,239.59 to Gulf Seafood Company of Empire, Inc. (Gulf), which furnished fuel to Best. On April 9, 1992, Phillips was notified that Diamond had recorded a lien in Plaquemines Parish under the Louisiana Oil, Gas, and Water Wells Lien Act, La.Rev.Stat.Ann. Secs. 9:4861-:4867 (the

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"Act"). 1 Phillips paid the suppliers in full in exchange for an assignment of their rights against Best. On June 8, 1992, Phillips recorded the TLC and Gulf liens in Plaquemines Parish. On July 9, 1992, Phillips commenced this action against Best seeking $117,320.71 plus costs and ten percent attorney's fees.

At trial, Best did not contest liability on the debts. Rather, it asserted three defenses to the applicability of the liens to its rig. First, Best contended that the TLC and Gulf liens were not recorded within the required 180 days and thus were prescribed under La.Rev.Stat.Ann. Sec. 9:4862.A. 2 Second, Best contended that the descriptions in the lien affidavits filed in the parish records were inaccurate and legally inadequate under id. Sec. 9:4862.C. Third, it contended that the liens were extinguished by confusion because Phillips asserted privileges against property that it leases.

After a bench trial on briefs and stipulated facts, the district court granted judgment for Phillips. The court rejected each of Best's defenses. On prescription, the court found that TLC last provided services to Best on January 8, 1992, and that Gulf had last provided fuel to Best on January 3, 1992. Consequently, the court held that Phillips had recorded the liens before the 180 day periods had run. On description, the court held that the descriptions on file were sufficient to put third parties on notice as to the property affected by the liens. Finally, on confusion, the court held that confusion was inapplicable because Phillips did not acquire full ownership of both sides of the lien obligations. Best raises these same three arguments on appeal.

DISCUSSION

We review a district court's findings of fact from a bench trial for clear error. Fed.R.Civ.P. 52(a); Verrett v. McDonough Marine Serv., 705 F.2d 1437, 1441 (5th Cir.1983). We review the court's legal conclusions de novo. 3

I. Prescription

Best contends that the district court's findings are clearly erroneous because TLC and Gulf provided no services or fuel to Best within the confines of the Bastian Bay Field after December 7, 1991. Best contends that the next day should count as the first day of the 180 day periods. Starting on December 8, 1991, the last day to record would have

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been June 4, 1992, making Phillips's recordation on June 8 too late. 4

At oral argument, Phillips conceded that the district court erred in finding that the last day of services occurred in January 1992. As an alternative argument, Phillips seeks to construe the "in connection with" language in Sec. 9:4861.B to include services up through December 10, 1991. If the first day...

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