Babineaux v. Southeastern Drilling Corp.

• Citation: 170 So.2d 518
• Decision Date: 05 January 1965
• Docket Number: No. 1252,1252
• Parties: Cleophile BABINEAUX, Jr., Plaintiff-Appellant, v. The SOUTHEASTERN DRILLING CORPORATION et al., Defendants-Appellees .
• Court: Court of Appeal of Louisiana (US)

Page 518

170 So.2d 518

Cleophile BABINEAUX, Jr., Plaintiff-Appellant, v. The SOUTHEASTERN DRILLING CORPORATION et al., Defendants-Appellees .

No. 1252.

Court of Appeal of Louisiana, Third Circuit.

Jan. 5, 1965.

Rehearings Denied Jan. 27, 1965.

Writ Refused March 29, 1965.

Piccione & Piccione, by Peter C. Piccione, Lafayette, for plaintiff-appellant.

Deutsch, Kerrigan, & Stiles, by Marian Mayer Burkett, New Orleans, Davidson, Meaux, Onebane & Donohoe, by Raymond Allen, Lafayette, for plaintiff-appellee.

EN BANC.

TATE, Judge.

This is a suit for workmen's compensation. The plaintiff Babineaux, a Louisiana resident, was injured in Kuwait, on the Persian Gulf, while engaged in oil-field work. He had been recruited while in Louisiana to perform this work overseas.

The plaintiff's suit was dismissed on exceptions. He appeals. We have earlier overruled the defendant's motion to dismiss the plaintiff's appeal as not timely perfected. La.App., 166 So.2d 742.

The plaintiff alleges that his injury was sustained in the course of his employment with the Seacat Offshore Drilling Company, the Seacat Marine Drilling Company, and the Southeastern Drilling Corporation, subsidiaries or affiliates of one another. These companies were made defendants together with their alleged compensation insurers. Exceptions to the jurisdiction were sustained as to the two former alleged employers and their insurers, while an exception of no cause of action was sustained as to the latter employer and its insurer.

We will discuss separately the plaintiff's claim against each of the defendants, insofar as different questions are presented.

I. Exceptions to the Jurisdiction: Seacat Offshore and Seacat Marine: factual basis.

Seacat Offshore was the plaintiff Babineaux's immediate employer. However, for purposes of the jurisdictional exception, Seacat Marine's position is considered identical as an alleged co-employer participating in the employment of Babineaux through activities in Louisiana which allegedly give this state jurisdiction of a suit on a cause of action arising out of this Louisiana-connected employment relationship.

Neither Seacat Offshore nor Seacat Marine have qualified to do business in this state, and neither of these Panamanian corporations have consented to be sued here. Louisiana jurisdiction is sought on the basis of LSA-R.S. 13:3471(1), as amended by Act 32 of 1960. ¹ This statute pertinently provides that a foreign corporation which 'has engaged in a business activity in this state' may be sued in Louisiana upon 'a cause of action resulting from such business activity in this state', ²

The plaintiff Babineaux contends that Louisiana has jurisdiction of his suit to recover for personal injuries because it is founded upon a cause of action resulting from his employment by the defendants through business activities conducted in this state.

Evidence was taken at the trial of the exceptions, supplementing uncontradicted allegations of the plaintiff's petition. The plaintiff relies upon the following Louisiana business activity as the basis of this state's jurisdiction as this cause of action:

The defendants advertised in a Lafayette, Louisiana, newspaper to solicit workers for offshore drilling work in the Persian Gulf. Applicants were instructed to appear at a Lafayette motel for interview commencing February 29th and continuing through March 2, 1960.

In response to this advertisement, Babineaux, a resident of Lafayette, reported on one of these dates at this Lafayette, La., motel. An interview of the plaintiff and of other applicants was conducted by an employee of Southeastern (one of the defendants) and an agent of the Seacat companies. As a result of information given to him, Babineaux then completed in Lafayette, La., an application for overseas employment.

About a month later, Babineaux was notified in Lafayette, La., to report to Dallas, Texas, for further interview. He was offered employment with Seacat Offshore in drilling work in the country of Kuwait in the Persian Gulf. In Dallas, he was given an employment contract for execution.

This employment contract was taken by Babineaux back with him to Lafayette, La., his home. After discussion with his wife, he telephoned from Lafayette, La., to Southeastern's office in Dallas, informing them that he would accept the overseas employment. He then executed in Lafayette, La., the employment contract in question, mailing it back to Dallas.

Babineaux was instructed to report to certain physicians in New Orleans, La., about a week later, for physical examination and to receive overseas innoculation. He went there from his home in Lafayette, La., was examined in New Orleans by doctors on behalf of his employers, and then returned to his home in Lafayette to await further instruction. (It is contended that he drew pay from the defendant employers during this period.)

On May 18, 1960, about two weeks later, Southeastern sent to Babineaux in Louisiana a copy of the completed employment contract (which its officer testified had been finally signed by him in Dallas on May 17th), together with a travel allowance check, a passport, a plane ticket, and an itinerary of the trip to Kuwait. In accordance with these instructions, Babineaux reported to New Orleans, La., on Friday, May 20th, taking the plane therefrom en route to Kuwait. According to his contract of employment, his pay commenced at the very least on this date, while he was still in Louisiana.

Several other employees were engaged for overseas operations as the result of the Lafayette activity--for Seacat Marine and Seacat of Iran as well as for Seacat Offshore, the plaintiff's immediate employer. Tr. 157.

The drilling rig for the Kuwait operation in which the plaintiff was injured, was assembled and repaired in Louisiana, and it was shipped from this state to Kuwait for use in those drilling operations.

The plaintiff thus contends that the employment relationship giving rise to his cause of action was entered into as the result of substantial business activity by the defendant employers in this state, so as to entitle this state to exercise personal jurisdiction over such defendants in a cause of action resulting from it.

(To complete the factual picture: The plaintiff was injured in Kuwait ten days after he left this state. Pursuant to the contract of employment, he was returned home to Louisiana at the expense of his employers. After returning home to Louisiana on July 10, 1960, Babineaux sought and was given substantial medical attention in Lafayette, La., allegedly pursuant to advice from defendants' agent to seek treatment for his condition from doctors in his home area in Louisiana.)

II. Seacat Employers's Exceptions to the Jurisdiction: 1960 Louisiana procedural statute basing jurisdiction on 'a business activity' in Louisiana: Its application to present facts.

The Seacat exceptions to Louisiana jurisdiction in personam are based upon the contention that the business activity described above is insufficient so as to confer upon Louisiana courts the jurisdiction of cause of action related to it. It is further suggested that this cause of action--for compensation benefits because of an accident in Kuwait--is insufficiently connected with the Louisiana business activity as to satisfy the statutory and constitutional requisites in such regard.

In the determination of these contentions, it is instructive to discuss the legislative history of LSA-R.S. 13:3471(1) as amended in 1960, the procedural statute under which jurisdiction over these foreign corporations is sought on the basis of their having engaged in 'a business activity in this state.' We must refer as well to the United States Supreme Court decisions upon which this expansion of personal jurisdiction over non-residents is based to the extent constitutionally permissible.

For many decades it was thought that a foreign corporation could not be sued in a forum state if the corporation was not domiciled or authorized to do business there. However, in the landmark decision of International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945), the Supreme Court recognized that, without offending the federal constitution, a state may exercise personal jurisdiction over such a foreign corporation, providing that it had certain minimum contacts with the forum state--'such contacts of the corporation with the state of the forum as make it reasonable, in the context of our federal system of government, to require the corporation to defend the particular suit which is brought there.' 326 U.S. 317, 66 S.Ct. 158. The Supreme Court stated: '* * * to the extent that a corporation exercises the privilege of conducting activities within a state, it enjoys the benefits and protection of the laws of that state. The exercise of that privilege may give rise to obligations; and, so far as those obligations arise out of or are connected with the activities within the state, a procedure which requires the corporation to respond to a suit brought to enforce them can, in most instances, hardly be said to be undue.' 326 U.S. 319, 66 S.Ct. 160.

In the International Shoe case, the foreign corporation was held to have sufficient contacts in the forum state through the continuous activities of its salesmen in soliciting orders, even though the corporation did not itself maintain a permanent office nor execute sales or other contracts in the forum state itself.

Following this decision, the ancestor provision of LSA-R.S. 13:3471(1) of 1960 (hereinafter referred to as the '1960 procedural statute'), was enacted, namely, LSA-R.S. 13:3471(5)(d), as amended by Act No. 21 of 1950. A specific purpose of the 1950 amendment was to permit Louisiana to exercise the full potential of the International Shoe case. (See Law Institute note, 'History and Source of Law', annotating the 1951 edition of West's Louisiana Revised Statutes.) This 1950 enactment...