96-0694 La.App. 4 Cir. 3/19/97, Howell v. American Cas. Co. of Reading, Pennsylvania

• Decision Date: 19 March 1997
• Citation: 691 So.2d 715
• Parties: 96-0694 La.App. 4 Cir
• Court: Court of Appeal of Louisiana — District of US

Page 715

691 So.2d 715

96-0694 La.App. 4 Cir. 3/19/97, 1997 A.M.C. 1739

Finley Richard HOWELL v. AMERICAN CASUALTY CO. OF READING, PENNSYLVANIA, Tilden

Elliott Contractors, Inc. and Chevron, U.S.A., Inc.

No. 96-CA-0694.

Court of Appeal of Louisiana, Fourth Circuit.

March 19, 1997.

Rehearing Denied April 30, 1997.

Bruce R. Hoefer, Jr., Ben O. Schupp, Milling, Benson, Woodward, Hillyer, Pierson & Miller, New Orleans, for Defendant/Appellant Chevron U.S.A., Inc.

Joseph G. Gallagher, Jr., Hulse & Wanek, New Orleans, for Defendant/Appellant American Casualty Company of Reading, Pennsylvania.

D. Kirk Boswell, John A. Scialdone, Terriberry, Carroll & Yancy, L.L.P., New Orleans, for Defendant/Appellant Rupert Murray Collins, as Lloyd's Underwriters' Nominee.

Robert A. Redwine, New Orleans, William J. Larzelere, Richard E. Jussaume, Jr., Larzelere & Picou, L.L.P., Metairie, for Defendant/and Third-Party Plaintiff/Appellant and Third-Party Defendant/Appellee Tilden J. Elliott Contractor, Inc.

Walter Landry Smith, Baton Rouge, and Philip F. Cossich, Jr., Belle Chasse, for Plaintiff/Appellant Finley Richard Howell.

Before ARMSTRONG, JONES and MURRAY, JJ.

[96-0694 La.App. 4 Cir. 1] ARMSTRONG, Judge.

This is a maritime personal injury action. The plaintiff, Finley Richard Howell, was employed by defendant Tilden J. Elliott Contractors, Inc. ("Elliott") aboard the self-propelled barge M/V BIG JIM. The BIG JIM was owned by defendant Chevron U.S.A., Inc. ("Chevron"). Elliott, pursuant to a contract with Chevron, supplied the entire crew of the BIG JIM which consisted of a foreman, Mr. Howell as the crane operator, two welders, two welders' helpers, and two riggers. The BIG JIM was used in coastal waters of the Gulf of Mexico to perform work on Chevron oil and gas platforms.

Mr. Howell suffered a back injury in an accident during the placing of a hatch cover on one of the Chevron platforms on April 20, 1988. That injury became extremely painful and symptomatic while Mr. Howell was routinely tightening a bolt at work on May 9, 1988. Mr. Howell ceased work for Elliott on that date. One of Elliott's insurers, American Casualty Company d/b/a CNA Insurance Companies ("CNA"), began to pay maintenance and cure benefits to Mr. Howell. Also, Mr. Howell underwent extensive medical treatment, including spinal surgery in October, 1988. His doctor released him to work in January, 1989 and CNA ceased maintenance and cure payments. At that time, he attempted to return to work with Elliott, but was told that there was no work for him, so he [96-0694 La.App. 4 Cir. 2] went to work with Delta Well Surveyors in February or March, 1989. He left that job in November, 1989 due to a personality conflict with a supervisor. He then sought other employment but, in November, 1989, while changing a car tire, he again began to experience serious back pain and symptoms.

Mr. Howell sought reinstatement of the maintenance and cure benefits after the tire changing incident but that request was refused. He then filed suit against Elliott, Chevron, Elliott's primary insurer, CNA and Elliott's excess insurer, Underwriters at Lloyd's ("Lloyd's"). Mr. Howell alleged claims under the Jones Act for negligence, under the general maritime law for unseaworthiness, for maintenance and cure, for punitive damages for failure to reinstate maintenance and cure, and for retaliatory discharge. CNA and Lloyd's each denied coverage. Elliott cross-claimed for coverage against CNA and Lloyd's. Chevron cross-claimed against Elliott for contractual indemnity and for indemnity by operation of law. Chevron denied status as a Jones Act employer of Mr. Howell and denied vicarious liability for Elliott's other employees who caused the April 20, 1988 accident. Chevron also sought to limit its liability to the value of the BIG JIM by raising the federal Limitation of Vessel Owners Liability Act by way of an affirmative defense in this action but did not file a concursus limitation proceeding in federal court.

Following a bench trial, the trial court found for Mr. Howell and against all the defendants and awarded judgment for Mr. Howell and against all defendants for $150,000 general damages. The trial court found for Elliott on its cross-claim against CNA in the amount of $125,000 plus attorney's fees of $66,408.27, later amended to $70,999.88. The trial court dismissed Chevron's indemnity cross-claim against Elliott. In its Reasons for Judgment, the trial court found that Mr. Howell had proven his claim for Jones Act negligence but rejected his claims as [96-0694 La.App. 4 Cir. 3] to general maritime law unseaworthiness and maintenance and cure (and, thus, punitive damages for failure to reinstate maintenance and cure) and, implicitly, rejected his claim for retaliatory discharge. Also in its Reasons for Judgment, the trial court found that there was no contributory/comparative negligence of Mr. Howell, found coverage under CNA's and Lloyd's insurance policies, held that Chevron was the "borrowing employer" of Elliott's employees so as to be the Jones Act employer of Mr. Howell, and so as to be vicariously liable for the negligence of the Elliott employees who caused the April 20, 1988 accident, and held that it was without jurisdiction to consider Chevron's limitation of liability defense. All parties appeal and, among them, challenge nearly all aspects of the trial court's decision. ¹

We hold as follows. First, the $150,000 general damages judgment in favor of Mr. Howell and against Elliott, Lloyd's and Chevron is increased to $450,000 (except, as to Chevron, the judgment is subject to the limitation of liability discussed in our fifth point below). In that connection, the trial court's determinations of Jones Act negligence, and lack of comparative/contributory negligence of Mr. Howell, are affirmed. We affirm the trial court's determination that maintenance and cure need not have been reinstated in November, 1989 and, in light of that determination, there can be no punitive damages for failure to so reinstate maintenance and cure. Further in that connection, we affirm the trial court's determination that Chevron was the borrowing employer of Mr. Howell and the other Elliott employees on board the BIG JIM. The trial court's implicit rejection of Mr. Howell's claim for retaliatory discharge also is affirmed. Mr. Howell should be awarded lost wages and medical expenses and we will remand for a factual determination of such lost wages and medical expenses.

[96-0694 La.App. 4 Cir. 4] Second, we hold that CNA's policy limit for this case is $25,000. As it is undisputed that CNA paid a little more than $25,000 in maintenance and cure benefits to Mr. Howell before this action was filed, there is no coverage for Mr. Howell's claim in this action and CNA did not owe Elliott a defense.

Third, we affirm the trial court's finding that there is coverage under the Lloyd's policy for Mr. Howell's claim. The "owned and/or operated" vessel exclusion in the Lloyd's policy is ambiguous in the present context.

Fourth, we hold that Chevron is entitled to contractual indemnity from Elliott. The contract between Elliott and Chevron is a maritime contract, governed by federal admiralty law, and, thus, the indemnity provision in that contract is not void by operation of Louisiana statutory law. As Chevron is entitled to indemnity not only as to its liability to Mr. Howell, but also for its attorney's fees and other expenses of this action, we will remand for proceedings to determine the amount of such attorneys fees and expenses.

Fifth, we hold that state courts do have jurisdiction to consider a defense of limitation of liability under the federal Limitation of Vessel Owner's Liability Act, even absent a federal court limitation concursus proceeding. Under the statute, Chevron's liability is limited to the $125,000 value of the BIG JIM in April 1988 as proven at trial. Accordingly, the judgment in favor of Mr. Howell and against Chevron must be reduced to $125,000.

Sixth, Lloyd's liability for Elliott's costs of defense is limited to Elliott's attorney's fees and other costs of defending itself against Mr. Howell's claims, and does not include Elliott's attorney's fees and other costs of litigating any other matters. We will remand for a determination of Elliott's recoverable attorney's fees and other costs.

[96-0694 La.App. 4 Cir. 5] Seventh, as Mr. Howell's recovery was under the Jones Act, legal interest on the judgment runs from the date of the accident but only on past damages and not on future damages.

Seaman Status

Some of the defendants argue that Mr. Howell is not a "seaman" so as to be able to recover under the Jones Act. The test for seaman status is that the plaintiff must (1) have duties that contribute to the function of a vessel or to the accomplishment of its mission and (2) have a connection to a vessel in navigation (or to an identifiable group of such vessels) that is substantial in terms of both its duration and its nature. Chandris, Inc. v. Latsis, 515 U.S. 347, ---- - ----, 115 S.Ct. 2172, 2190-91, 132 L.Ed.2d 314 (1995).

Thus, because seaman status is dependent upon the involvement of a "vessel in navigation", we must determine whether the BIG JIM was a vessel in navigation. The BIG JIM was self-propelled with its own engines, twin screws (propellers), steering equipment, rudders, raked bow, and wheelhouse. It had running lights, mooring lines and bits, a lifeboat, and a cabin and kitchen. The BIG JIM worked at many different locations and normally moved from one to the next under its own power. The BIG JIM moved on a daily basis in navigable waters. The trial court found that there is "no question" that the BIG JIM is a vessel and that "vessel status is clearly established." The Supreme Court has emphasized that vessel status is primarily a question for the finder of fact. Ebanks v. Reserve Marine Enterprises, Inc., 625 So.2d 1050 (La.1993), cert. denied, ...