Consolidated Aluminum Corp. v. CF Bean Corp., Civ. A. No. 81-0500.

• Decision Date: 16 July 1986
• Docket Number: Civ. A. No. 81-0500.
• Citation: 1987 AMC 1625,639 F. Supp. 1173
• Parties: CONSOLIDATED ALUMINUM CORPORATION v. C.F. BEAN CORPORATION, et al.
• Court: U.S. District Court — Western District of Louisiana

639 F. Supp. 1173

1987 AMC 1625

CONSOLIDATED ALUMINUM CORPORATION v. C.F. BEAN CORPORATION, et al.

Civ. A. No. 81-0500.

United States District Court, W.D. Louisiana, Lake Charles Division.

July 16, 1986.

Robert W. Winson, Robert W. Doty, Howard D. Schwartz, Eckert, Seamans, Cherin, & Mellott, Pittsburgh, Pa., A. Lane Plauche, Plauche, Smith & Nieset, Lake Charles, La., for plaintiff.

Allen F. Campbell, Deutsch, Kerrigan & Stiles, New Orleans, La., for C.F. Bean Corp. and Bean Dredging Corp.

Edgar F. Barnett, Woodley, Barnett, Williams & Fenet, Lake Charles, La., for Highlands Ins. Co. Mat M. Gray, III, Faris, Ellis, Cutrone & Gilmore, New Orleans, La., for St. Paul Fire & Marine Ins., Inc.

S. Gene Fendler, Suzanne Dittmer, Liskow & Lewis, New Orleans, La., for Texaco, Inc.

Richard N. Dicharry, Phelps, Dunbar, Marks, Claverie & Sims, New Orleans, La., for Arkwright-Boston Mfgs. Mut. Marine Ins. Co.

Alan Van Emmerik, David V. Hutchinson, U.S. Dept. of Justice, Torts Branch, Civ. Div., Washington, D.C., for U.S., third party defendants.

OPINION

VERON, District Judge.

Plaintiff, Consolidated Aluminum Corporation (hereinafter referred to as Consolidated) filed suit seeking lost profits and damages allegedly sustained by its aluminum manufacturing plant located south of Lake Charles, Louisiana. The alleged damages occurred when the natural gas supply to the plant was shut off due to a dredging barge breaking the pipeline which supplied the natural gas. Named as defendants were: C.F. Bean Corporation and Bean Dredging Corporation (hereinafter collectively referred to as Bean), the owners/operators of the dredge; Bean's insurers; and, Texaco, Inc. (hereinafter referred to as Texaco), the owners of the pipeline. Texaco subsequently filed a third-party claim against the United States through the United States Army Corps of Engineers (hereinafter referred to as Corps of Engineers), as the party with primary responsibility for the dredging operations, tendering the Corps of Engineers to Consolidated as a direct defendant. Additionally Texaco has asserted a cross-claim against Bean for the cost of repairing its pipeline and the value of the natural gas lost due to the rupture of the pipeline by Bean. Texaco also seeks indemnification or contribution from Bean for any amount it might be required to pay to Consolidated. Texaco has filed a claim against the United States through the Corps of Engineers contending that the Corps of Engineers is liable for Bean's actions because it failed to properly supervise and control Bean's activities, and that the Corps of Engineers is independently liable because it failed to select a competent contractor to dredge the Calcasieu River Ship Channel. Bean has filed a cross-claim against Texaco, seeking indemnification or contribution in any amount for which it may be cast.

This Court acting upon Bean's motion for summary judgment originally granted that summary judgment as to Bean on the grounds that, under Robins Dry Dock & Repair Co. v. Flint, 275 U.S. 303, 48 S.Ct. 134, 72 L.Ed. 290 (1927), no cause of action exists in tort for negligent interference with contract.¹ The United States Fifth Circuit Court of Appeals, 772 F.2d 1217, reversed the summary judgment and remanded, finding that "the bright line" rule of Robins Dry Dock did not apply in the instant case and stating that the plaintiff's claim of negligence should be analyzed under tort principles applied by this Court in admiralty.

The issues of liability and quantum of damages have been bifurcated with the latter being reserved for resolution at a future date.

On remand, after hearing the testimony, reviewing the stipulations and pleadings, and weighing all of the evidence presented at trial on the merits, the Court makes the following:

FINDINGS OF FACT

1.

Consolidated is and was at all pertinent times a New York corporation doing business within this District. Bean (collectively) is and was at all pertinent times a Louisiana corporation. Texaco is and was at all pertinent times a Delaware corporation doing business within this District. The United States is and was at all pertinent times a sovereign nation as to which venue properly lies within this District.

2.

In 1963, Texaco laid a natural gas pipeline in order to provide natural gas service to one customer, PPG Industries, Inc. This pipeline consisted of two segments: a six-inch line known as the "Big Lake Line" or the "Hackberry Line," running from the Hackberry area south of Lake Charles, Louisiana to a valve manifold known as "Point C"; and, a twelve-inch line known as the "PPG Lateral," running from Point C to the PPG plant located across the Calcasieu River.

The Corps of Engineers issued a permit (no. LMNOD (Calcasieu River) 287) to Texaco allowing Texaco to construct the twelve-inch pipeline across the Calcasieu River at Mile 31.9 Station No. 1683 + 90. The permit set forth the guidelines to be followed in laying and maintaining the pipeline crossing. The permit additionally provided in Clause (g), as one of the conditions for issuance:

That the United States shall in no case be liable for any damage or injury to the structure or work herein authorized, which may be caused by or result from future operations undertaken by the Government for the conservation or improvement of navigation or for other purposes and no claim or right to compensation shall accrue from any such damage.

That pipeline was laid and maintained in accordance with the requirements of the Corps of Engineers permit.

4.

In 1965, Texaco connected an unused sixteen-inch production line, known as the "Evangeline Pipeline," to the PPG lateral. Natural gas was then transported through the Evangeline Pipeline.

5.

By contract dated September 20, 1968, a Gas Sales and Purchase Contract was executed between Texaco and Consolidated's predecessor in interest, Gulf Coast Aluminum Corporation. In accordance therewith, a pipeline was laid from Point C southward to Consolidated's plant, located south of Lake Charles. The gas contract provided that Consolidated would purchase its plant's requirements, up to a stated maximum, and in any case, not less than a specific quantity of gas, from Texaco.

6.

On December 14, 1979, Bean, who at all times held itself out to the public as an expert, independent dredging contractor, entered into Construction Contract No. DACW 29-80-C-0063 with the United States Army Engineer District, New Orleans for maintenance dredging of the Calcasieu River and Pass from Mile 15.5 to Mile 36, along with other areas unimportant to this litigation. For the area surrounding Texaco's pipeline crossing, the contract specifications called for dredging to a minus forty feet MLG (mean low gulf) over a four hundred foot project width of the bottom with one foot allowable overdredging and side slopes of one to three feet.

7.

General provision 12 of the contract provides in pertinent part:

The Contractor shall, without additional expense to the Government, be responsible ... for all damages to persons or property that occur as a result of his fault or negligence. He shall take the proper safety and health precautions to protect the work, the workers, the public and the property of others....

8.

And, the technical provisions of the contract provides:

1-10.1 The Contractor shall exercise caution when working in the vicinity of structures and utilities crossing or adjacent to the channel or disposal areas. Repair of any damage resulting from excessive or improper excavation in the bottom or side slopes of the channel will be the responsibility of the Contractor. Where dredging to the theoretical section might endanger any structure, the Contracting Officer may reduce the required excavation in the vicinity of such structure.

1-10.2 The Contractor shall provide at least project dimensions over all utility crossings by whatever approved method the Contractor elects to use. The Contractor shall submit for approval by the Contracting Officer a detailed plan of operation at each pipeline or utility crossing where construction surveys indicated project channel does not exist. The plan shall contain emergency measures to be taken in the event of an accident. The Contractor shall notify the owners of pipelines or utilities at least 3 days prior to operating within 150 feet of a pipeline or utility.

1-10.3 The following structures or utilities are located within the limits of the work. The vertical clearances listed below were furnished by the utility owners at the time permits were issued and are not the result of a survey made by the Government. It will be the responsibility of the Contractor to verify these locations and clearances.

9.

The correct location of Texaco's pipeline was provided in the contract as well as Texaco's address.

10.

On January 14, 1980, Bean provided the Corps of Engineers with a general plan for safe dredging around and over utility crossings like Texaco's pipeline, which was approved by the Corps of Engineers. Among other things this plan provided that:

The owners of each pipeline and/or utility lines will be contacted at least seven (7) days before by phone and by letter to have a crew come out and mark and verify the elevations of respective lines and give all information to the Dredge Superintendent.... Bean will request that a representative be on board the dredge to witness the depths and swing of the dredge.

This plan further provided that the dredge was to advance to within twenty-five feet of the pipeline and then tie off the cutter. This plan reflected the typical and customary practice in the dredging industry.

11.

Dredging began on January 14, 1980. On March 24, 1980, Bean added its Dredge No. 32 (the dredge involved in this matter) to the project. The dredge was 202 feet long, 49 feet in width, and contained a 56 foot cutter ladder, to which the cutter was attached. The dredge maintained a crew of approximately 45 men.

12.

Mr. Elton...