Armstrong v. Chambers & Kennedy
| Decision Date | 07 March 1972 |
| Docket Number | Civ. A. No. 70-H-1171. |
| Citation | 340 F. Supp. 1220 |
| Parties | Webster Barnwell ARMSTRONG, III, et al. v. CHAMBERS & KENNEDY et al. |
| Court | U.S. District Court — Southern District of Texas |
COPYRIGHT MATERIAL OMITTED
COPYRIGHT MATERIAL OMITTED
COPYRIGHT MATERIAL OMITTED
COPYRIGHT MATERIAL OMITTED
COPYRIGHT MATERIAL OMITTED
COPYRIGHT MATERIAL OMITTED
COPYRIGHT MATERIAL OMITTED
COPYRIGHT MATERIAL OMITTED
Warner F. Brock, Brock & Williams, Houston, Tex., for plaintiffs.
Frank Harmon, Baker & Botts, Houston, Tex., for defendants.
Late in the afternoon of May 28, 1970, explosions and fire occurred on the Chambers & Kennedy (C & K) Offshore Oil Platform, an unmanned collection platform for oil wells in Block 189-L, located 12 miles southeast of Galveston, Texas. The holocaust that ensued resulted in the death of five workmen, one supervisor, and three crew members of the standby boat, M/V CARRYBACK, which was moored below the platform. Six other platform workers were hospitalized. The burning vessel was retrieved, but the damage it sustained rendered it beyond repair. All of the tanks on the platform were destroyed or distorted beyond repair. The platform itself received severe damage calling for extensive repairs. The oil in the tanks ultimately found its way to a part of the beaches near Galveston necessitating substantial costs in removing this pollutant.
The complexity of the liability issues here in question dictates a thorough review of the events which culminated in this tragic loss of life and property. C & K had purchased the platform with a capacity of 5,000 barrels of oil in a somewhat deteriorated state in 1968. After some discovery wells were drilled, the platform was used to store crude oil which was produced from satellite wells 4,000 feet from the platform. Crude oil from one producing well was piped through a separator to a cylindrical tank called a gun barrel. When this tank filled, the oil flowed into one of five storage tanks, thence through equalizing lines to the other four tanks. The tanks were sounded regularly, and when enough oil had accumulated, it was transported by barge to the shore. C & K hired, under a written well service agreement dated December 1, 1968, the engineering firm of Drilling Engineering, Inc. (DEI) to operate and maintain the platform. This agreement included an indemnity clause that will be thoroughly discussed later. It was the intention of the parties to the contract, C & K and DEI, that all work in question that was to be performed on the platform, including repairs, alterations, production of the wells, and all work necessary to bring the platform up to the standards and regulations set by the United States Geological Survey was to be carried out under the December 1, 1968, contract. The cutting of the equalizer valve was work done under this contract and in compliance therewith. A letter dated April 28, 1970, was nothing more than a report from DEI to C & K on the status and progress of the platform work and, as stated in the letter, an outline of work "required for complaince with United States Geological Survey requirements" (Harvey Exhibit 4). This letter did not constitute a new agreement between the parties.
On March 18, 1970, Mr. George Kinsel of United States Geological Survey wrote Lyle Harvey of C & K and suggested that the platform be brought into compliance with 30 C.F.R. 250.49 and 30 C.F.R. 250.46 safety regulations. On April 3, 1970, Mr. Kinsel called Mr. Harvey suggesting that C & K voluntarily shut down the field.
On April 8, 1970, all production from all the wells was ordered shut down by Mr. Harvey, an employee of C & K. This order was communicated to Mr. Chenier of DEI. At least as of April 10th all production was shut down. On April 11th all of the oil that was then in the tanks was taken out by means of a barge. Thereafter and sometime between April 11 and May 28, some production out of one of the wells came about and somewhere in the neighborhood of 1,100 barrels of oil was pumped into the tanks.
C & K knew that this oil was in the tanks through Mr. Harvey. DEI knew that this oil was in the tanks through Mr. Chenier. At this time, Mr. Ray was DEI's engineer on the job, and Mr. Ray knew that this oil was in the tanks.
On May 23rd, Mr. Ray had to leave the job because of an abscessed tooth and Mr. Monk took over and became the DEI engineering supervisor on the job, working under Mr. Chenier. Mr. Ray told Mr. Monk that there was oil in the tanks, so that as of at least May 23rd, Mr. Monk knew there was oil in the tanks.
In the course of their work, DEI hired Fenstermaker, Behling, Pollock & Associates, an engineering firm of Lafayette, Louisiana, to make a studied survey of the platform and the anticipated needs for the restoration work contemplated. It is important to note that in the report to C & K developed from the Fenstermaker study, DEI did not recommend incurring the expense of draining any residue oil from the tanks. The platform had been shut down for alterations and repairs for several weeks prior to the casualty. The work on the platform consisted mainly of sandblasting, painting, renovation of the structural members, installation of prefabricated drip pans under the oil tanks, and fitting a closed draining sump system. This work necessitated burning and welding on the platform, but testimony indicates that any hot work was to be done on the end of the platform furtherest away from the oil storage tanks.
DEI did not have the manpower called for to complete the operations required, thus they had in turn contracted out the actual physical labor needed on the platform to the firm of Hydrotech. However, as of May 23, 1970, DEI had become dissatisfied with Hydrotech's performance and had decided to hire another firm to supply the men to complete the work. Mr. Williams, president of DEI, contacted Chapman Contracting Service Company (Chapman) to take over the job. On Sunday, May 24th, Ricky Chapman, vice president of Chapman, met with William Ray, a member of the DEI firm and at one time the DEI supervisor on the platform, in Galveston to discuss the job. At that time, Mr. Ray told Mr. Chapman some of the details of the job and the working conditions that existed on the platform, namely, that there was oil in the tanks, that the platform was like working on a bomb, that it was necessary to use good safety regulations, and that everyone should be extremely cautious. Mr. Ray explained that Mr. Monk, the deceased DEI supervising engineer, was in charge of the job. Mr. Ray also explained that the work consisted of certain tasks that necessitated welding. On Sunday, May 24th, Ricky Chapman went to the jobsite and inspected the platform himself. The following Monday, May 25th, Mr. Chapman assembled twenty-two workmen including four supervisors for the work. On Tuesday, May 26th, the Chapman men did their first day's work on the C & K platform. Ricky Chapman along with Mr. Chenier, a DEI engineer, were both on the platform again on the day of the explosion, leaving two hours before the casualty.
All of the Chapman workers, as well as the DEI supervisors, were transported from the shore to the platform every day, used the facilities of, and received their meals on the standby boat, the M/V CARRYBACK. The M/V CARRYBACK, operated by Dearborn Marine Services, was a boat without an inspection certificate and captained by an unlicensed master. The corporations Freeport Operators, Dearborn Marine, and Thoroughbred are all owned by one parent company, all having interlocking directors and officers. For the purposes of this case, they have agreed to and will be treated as one entity. Joe Dyer was an officer of each of these corporations. Mr. Dyer had the authority to hire and fire employees and to make contractual arrangements regarding the use of the boats, including the CARRYBACK, owned and/or operated by Dearborn Marine and to supply crews that were on the payroll of Freeport Operators to man the boats. Thoroughbred owned all of the boats including the CARRYBACK and had an arrangement with Dearborn Marine whereby Thoroughbred bare-boat chartered the boats to Dearborn.
On Wednesday, May 27th, three representatives of the United States Geological Survey landed by helicopter on the platform and advised the engineer in charge that it was going to be necessary to remove a valve from the overflow line between two of the crude oil storage tanks. This was required to bring the platform into compliance with U.S. anti-pollution regulations. However, at some time before the casualty, Mr. Chenier, an employee of DEI, had been advised by Mr. Kinzel of the United States Geological Survey that the valve on the equalizer line had to be removed. On the day of the casualty but before the explosion, Mr. Chenier discussed with Mr. Monk the necessity for the removal of the valve. The removal of this equalizer valve was the first work on the platform to require the breaking of any connections leading to the oil storage tanks. Indeed, on the day of the casualty, but before the explosion, Mr. Monk, the DEI supervisor, discussed with Mr. Overly, the Chapman foreman, the operational aspects of the removal of the valve from the equalizer line.
On the day of the casualty but before the actual casualty, Mr. Overly instructed Mr. Scanlan, a pusher for Chapman, to remove the valve from the equalizer line. Mr. Scanlan, along with the two other Chapman employees, began working on the equalizer line and broke the union and cut the pipe with a pipe cutter. They took out the valve leaving a part of the equalizer line protruding in place. They then proceeded to take the valve and the other part of the equalizer line to the south end of the platform beneath the heliport and there fabricated, or threaded, a new piece of pipe called a nipple to put back in the equalizer line and reconnect it. Mr....
To continue reading
Request your trial
-
In re Dearborn Marine Service, Inc.
...there was an explosion. Burning oil then rapidly spread fire across the platform, resulting in death and injuries and damage there. 340 F.Supp. at 1231-1232 (emphasis in The CARRYBACK was just downwind of the explosion, tied to the platform on a seventy-five foot line with her stern toward ......
-
Olsen v. Shell Oil Co.
...of whether or not Shell was in fact negligent. In support of this theory of liability, the plaintiffs cite to us Armstrong v. Chambers & Kennedy, 340 F.Supp. 1220 (S.D.Tex.1972), aff'd on other grounds sub nom. In Re Dearborn Marine Service, Inc., 499 F.2d 263 (5th Cir. 1974). In Chambers &......
-
Oppen v. Aetna Insurance Co.
...long as he was acting at the time as a seaman in the service of his ship." 416 F.2d at 850. Directly in point is Armstrong v. Chambers & Kennedy, 340 F.Supp. 1220 (S.D.Tex.1972). In that case an explosion and fire on an offshore drilling platform resulted in injury to persons and property o......
-
Wiley v. Offshore Painting Contractors, Inc.
...not have been a contributing cause of the disaster." The E. Madison Hall, 140 F.2d 589, 591 (4th Cir.1944); Armstrong v. Chambers & Kennedy, 340 F.Supp. 1220, 1246 (S.D.Tex.1972), rev'd on other grounds sub. nom. In re Dearborn Marine Service, Inc., 499 F.2d 263 (5th This contention was nev......
-
CHAPTER 7 LIABILITIES OF NONOPERATING OIL AND GAS INTEREST OWNERS
...60-61; Jones, supra note 147, at 183-85. [151] See, e.g., Franklin Drilling Co. v. Jackson, 202 Okla. 687, 217 P.2d 816 (1950). [152] 340 F. Supp. 1220, 1234-35 (S.D. Tex. 1972), modified, 499 F.2d 263 (5th Cir. 1974), rehearing denied, 512 F.2d 1061, cert. dismissed, 423 U.S. 886 (1975); s......
-
CHAPTER 1 LIABILITIES OF NONOPERATING INTEREST OWNERS
...60-61; Jones, supra note 131, at 183-85. [135] See, e.g., Franklin Drilling Co. v. Jackson, 202 Okla. 687, 217 P.2d 816 (1950). [136] 340 F. Supp. 1220, 1234-35 (S.D. Tex. 1972), modified, 499 F.2d 263 (5th Cir. 1974), rehearing denied, 512 F.2d 1061, cert. dismissed, 423 U.S. 886 (1975); s......