Cargill, Inc. v. Offshore Logistics, Inc.

• Decision Date: 07 April 1980
• Docket Number: No. 79-3245,79-3245
• Citation: 615 F.2d 212
• Parties: CARGILL, INCORPORATED, Plaintiff-Appellant, v. OFFSHORE LOGISTICS, INC., Defendant-Appellee. Summary Calendar. *
• Court: U.S. Court of Appeals — Fifth Circuit

Page 212

615 F.2d 212

CARGILL, INCORPORATED, Plaintiff-Appellant, v. OFFSHORE LOGISTICS, INC., Defendant-Appellee.

No. 79-3245

Summary Calendar. ^*

United States Court of Appeals Fifth Circuit.

April 7, 1980.

Onebane, Donohoe, Bernard, Torian, Diaz, McNamara & Abell, Randall C. Songy, Lafayette, La., for plaintiff-appellant.

Phelps, Dunbar, Marks, Claverie & Sims, Howard Daigle, Jr., New Orleans, La., for defendant-appellee.

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

Before HILL, GARZA and THOMAS A. CLARK, Circuit Judges.

GARZA, Circuit Judge:

In this diversity case we are asked by the Appellant, Cargill, Inc., to rule contrary to the state law of Louisiana as previously followed by this court. This we decline to do and affirm the court below.

On November 19, 1977, a helicopter owned and operated by the Defendant and Appellee here, Offshore Logistics, Inc., struck and severed a power line owned by Central Louisiana Electric Company, Inc., hereinafter called CLECO. Appellant Cargill, Inc. alleges that as a result of this incident CLECO was unable to supply electrical power to its salt mine in Belle Isle, Louisiana, thus forcing Plaintiff to suffer its alleged damages. The power was off for a period of three days and Cargill alleges that it lost production revenues and had to pay contractual penalties to customers whom they could not supply what they had contracted to do.

The court below granted the Defendant Appellees' motion for summary judgment which had been filed claiming that the complaint failed to state a cause of action under the substantive law of Louisiana.

CLECO did not have the necessary facilities to service the electrical needs of Cargill at its salt mine and on March 19, 1962, Plaintiff Appellant Cargill and CLECO entered into an agreement for electric service to the Plaintiff Appellants' salt mine under which CLECO would furnish Cargill all of its electrical power needs. The parties agreed that the cost of building this thirteen mile transmission line and power stations would cost no less than $250,000.00 and attached a Rider to the usual form of electrical power contract under which Cargill agreed to pay a facilities charge to CLECO of $2,000 per month during the ten year period of the contract. Cargill agreed to pay so much for each kilowatt hour of power used plus $2,000.00 a month. Under the Rider CLECO agreed to rebate so much for power used by Cargill and any other customer receiving power from this transmission line and facilities but the rebate could never exceed the amount of the facilities charge of $2,000 per month. The contract was to terminate in October of 1972. At the time of the severance of the transmission line Sun Oil Company was also receiving power from CLECO to operate its gas processing plant located on Belle Isle.

The contract between CLECO and Cargill contemplated that Cargill would pay the facilities charge provided for in the Rider whether they bought power or not from CLECO. CLECO reserved the right to remove its poles, lines and power station facilities from the property of Cargill at the termination of the agreement.

The negligence of the Appellee Offshore Logistics, Inc. resulted in damage to the physical property of CLECO and they were the only ones that could receive damages for such negligence since they were the owners of the physical property damaged. It seems to be clear that under the substantive law of Louisiana there can be no recovery for alleged damages resulting from negligent interference with contractual relations or business expectation.

In Hamilton v. Canal Barge Company, Inc., 395 F.Supp. 978 (D.C.La.), Judge Rubin, now of this court, in a case in which a fiancee was trying to recover damages for the negligent demise of her fiancee crewman because that negligence had caused her fiance to breach his contract of marriage, held that both under Louisiana and admiralty law there was no cause of action for interference with contractual relations.

In Kaiser Aluminum & Chemical Corp. v. Marshland Dredging Co., 455 F.2d 957 (5th Cir. 1972), this court held in circumstances which are indistinguishable from the instant case that there could be no cause of action for negligent interference with contractual relations. A recital of the facts in Kaiser Aluminum will show that under similar circumstances to those before us this court has denied damages. In that case the crew of a dredging company's boat dropped a heavy anchor which punctured a high pressure pipeline supplying gas to Kaiser Aluminum's chemical refinery. Due to the interruption of the gas supply Kaiser was forced to incur shut down expenses and production losses which they alleged amounted to $170,299.00. Since Kaiser Aluminum did not own the damaged pipeline, they were denied consequential damages because of the damage to the pipeline.

In Kaiser Aluminum, this court relied on Robins Dry Dock & Repair Company v. Flint, 275 U.S. 303, 48 S.Ct. 134, 72 L.Ed. 290 (1927). In that case the Supreme Court held that as a general rule a tort to the person or property of one man does not make the tortfeasor liable to another merely because the injured person was under a contract with that other, unknown to...