Graham v. Amoco Oil Co.

• Decision Date: 26 May 1994
• Docket Number: No. 93-3190,93-3190
• Citation: 21 F.3d 643
• Parties: Leanna M. GRAHAM, wife of David Graham, individually and on behalf of minor child, Kayla J. Graham and as curator of David Graham, Plaintiffs-Appellants, v. AMOCO OIL COMPANY, Defendant-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 643

21 F.3d 643

1995 A.M.C. 291

Leanna M. GRAHAM, wife of David Graham, individually and on behalf of minor child, Kayla J. Graham and as curator of David Graham, Plaintiffs-Appellants, v. AMOCO OIL COMPANY, Defendant-Appellee.

No. 93-3190.

United States Court of Appeals Fifth Circuit.

May 26, 1994.

Alvarez T. Ferrouillet, Ferrouillet & Ferrouillet, Adolph J. Levy, New Orleans, LA, Richard A. Fraser, III, Fraser & Sterbcow, New Orleans, LA, David W. Robertson, Austin TX, for appellants.

Ronald Adams Johnson, David J. Schexnaydre, Johnson, Johnson, Barrios & Yacoubian, New Orleans, LA, for appellee.

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

Before JOHNSON, GARWOOD, and JOLLY, Circuit Judges.

E. GRADY JOLLY, Circuit Judge:

In this personal injury case, we are primarily concerned with the questions of duty and causation. Here, an oil rig worker sustained an injury while working for his employer on the employer's oil drilling rig. At the time of the injury, the employer was operating as an independent contractor for the oil company that owned the platform on which the rig was located. The oil rig worker's wife and child sued the oil company for negligently causing the injury. The district court granted summary judgment to the oil company on the basis that the oil company was not responsible for the negligent acts of the independent contractor and committed no negligent acts itself that caused the injury. Finding no reversible error, we affirm.

I

Amoco Oil Company ("Amoco") owned an offshore drilling platform affixed to the Outer Continental Shelf of the Gulf of Mexico off the State of Louisiana. Amoco hired Dual Drilling Company ("Dual") to drill several wells from the platform. On December 2, 1990, David Graham, a Dual employee, was working on Dual Rig 23 that was located on Amoco's platform. The rig was rated as being capable of drilling wells to 20,000 feet. Amoco ordered and delivered a load of 14,100 feet of 11 3/4" casing pipe to the Dual rig for the drilling of the well listed as A-3. Pursuant to the contract, a team of Dual employees, supervised by Denis Riley, another Dual employee, unloaded the casing onto the rig. The Dual rig had two cranes affixed to it, and Riley operated one of these cranes as it picked up two lengths of casing from the delivery ship and placed them onto pipe racks onboard the rig. Because of the volume of casing being unloaded, casing and drill pipe covered the floor of the rig. Graham was standing on some of this drill pipe as he helped guide two pieces of casing that Riley's crane was loading onto the pipe racks. Because Graham was standing on the drill pipe, his head was a few feet higher than normal. When the casing swung toward him, Graham ducked, but he was too late as the casing caught his head against the second crane and crushed it leaving Graham in a comatose state.

II

Graham's wife and child brought this action against Amoco on behalf of Graham for his injuries and on their own behalves for their loss of consortium. The plaintiffs alleged, inter alia, that Amoco was negligent in two ways: first, it delivered too much casing to the Dual rig at one time; and second, its "company man" failed to stop the unsafe unloading operation. The district court granted summary judgment to Amoco on the grounds that: (1) Amoco was immune from liability for the acts of Dual as an independent contractor; and (2) Amoco's ordering of the casing was not the legal cause of Graham's injury.

III

We review the summary judgment de novo using the same standards that guided the district court. DFW Metro Line Servs. v. Southwestern Bell Tel. Co., 988 F.2d 601, 603-04 (5th Cir.), cert. denied, --- U.S. ----, 114 S.Ct. 183, 126 L.Ed.2d 142 (1993). Accordingly, summary judgment is appropriate when, after viewing the facts in the light most favorable to the nonmovants, no material issue of fact exists, and the movant is entitled to judgment as a matter of law. Id. at 604.

Louisiana law provides the general rule that a principal is not liable for the negligent acts of an independent contractor acting pursuant to the contract. Bartholomew v. CNG Producing Co., 832 F.2d 326, 329 (5th Cir.1987); Hawkins v. Evans Cooperage Co., 766 F.2d 904, 906 (5th Cir.1985). This general rule has two exceptions under which a principal may be liable when: (1) the suit arises out of the ultrahazardous activities of its independent contractor; or (2) the principal retains operational control over the independent contractor's acts or expressly or impliedly authorizes those acts. Bartholomew, 832 F.2d at 329; Westridge v. Poydras Properties, 598 So.2d 586, 590 (La.Ct.App.), writ denied, 605 So.2d 1099 (La.1992). Further, even though the general rule shields a principal from the acts of its independent contractor that do not fall within the above exceptions, the principal remains liable for its own acts of negligence. Ellis v. Chevron U.S.A. Inc., 650 F.2d 94, 97 (5th Cir.1981); Smith v. Indiana Lumbermens Mutual Ins. Co., 175 So.2d 414, 416 (La.Ct.App.), writ denied, 247 La. 1089, 176 So.2d 146 (1965).

In the instant case, we must determine whether Amoco is liable for the acts of Dual under the second exception to the general rule; that is, whether Amoco retained control over, or expressly or impliedly authorized, Dual's unloading activities that resulted in Graham's injury. Further, we must determine if Amoco is liable under principles of negligence for its own independent acts of ordering and delivering the shipment of casing to Dual's rig.

IV

First, the plaintiffs argue that Amoco is liable for the unloading activities of Dual under the second exception to the general rule of immunity for the acts of an independent contractor. Specifically, they argue that Amoco is liable for Graham's injury because it's "company man," Dudley Blanchard, authorized the payment for the extra men necessary to unload the large order of casing, and he inspected the color codes on the casing. Further, the plaintiffs assert that Blanchard was present on the Dual rig during the unloading, saw the unsafe conditions created by the excess amounts of casing stacked on the rig--including the danger that a worker would be pinned against a crane while standing on a stack of drill pipe that covered the floor of the rig--and did not stop the operation.

We are faced, however, with Amoco's contract with Dual that provided:

Contractor [i.e., Dual,] shall be solely responsible for the supervision of the following operations of the Rig as appropriate: towing, rigging up, positioning on drilling locations, rigging down, loading and unloading operations on and off the Rig, and including also such operations onboard said Rig as may be necessary or desirable for the safety of said Rig.

(Emphases added).

The contract also provided that although Amoco retained the right to inspect the work site as the project progressed, it was "interested only in the results obtained."

In Ainsworth v. Shell Offshore, Inc., 829 F.2d 548, 550-51 (5th Cir.1987), we held that a principal did not retain control over the step-by-step operations of a drilling rig through the presence of a "company man" when the contract provided that the independent contractor was responsible for the performance of all the work, and the principal was interested solely in the results obtained. As we have noted above, the contract here expressly provides that Dual has sole responsibility for unloading and safety activities. Amoco's "company man" only approved the payment of extra workers to handle the unloading of the casing and inspected the color codes on the pipe. This minimal degree of involvement does not amount to a retention of operational control over the unloading activities. See Williams v. Gervais F. Favrot Co., 499 So.2d 623, 626 (La.Ct.App.1986) (holding that periodic inspections by owner did not amount to operational control of construction site managed by independent contractor), writ denied, 503 So.2d 19 (La.1987).

It is true, as Graham points out, that in Bartholomew, 832 F.2d at 329-30, we held a principal liable for the acts of an independent contractor. There, however, its representative expressly ordered the independent contractor to engage in an unsafe work practice that eventually caused an injury to the plaintiff. Id. There was no such express authorization in the instant case because Amoco's "company man" did not order Dual's employees to engage or not to engage in any unloading practice. In any event, it is certainly clear that Amoco did not expressly authorize any of Dual's negligent unloading acts.

Nor do the facts here permit a conclusion that Amoco impliedly authorized the condition that caused Graham's injury. In Williams, 499 So.2d at 626, for example, the court held that a principal did not "impliedly or expressly authorize [the independent contractors] to undertake the dangerous ... project which led to the death of the [plaintiff's] husband ... [because] only the [independent contractors] participated in the decision to use [the negligent] procedure." Further, in Davenport v. Amax Nickel, Inc., 569 So.2d 23, 28 (La.Ct.App.1990), writ denied, 572 So.2d 68 (La.1991), the court held that neither the express or implied authorization exception applied when the principal's personnel inspected the job site and may have pointed out certain safety violations. In the instant case, the "company man" did not participate in any decision-making process concerning the manner in which the Dual team unloaded and stacked the casing. Nor did the "company man" give any advice concerning safety violations. Instead, the plaintiffs allege that Amoco's "company man" merely observed Dual's employees performing the duties for which the governing contract gave them the "sole" responsibility. Thus, we cannot say that Amoco impliedly authorized the unsafe unloading procedures that caused Graham's injury. We therefore hold as a...