Miller v. Phillips Petroleum Co. Norway

• Decision Date: 24 June 1986
• Citation: 529 A.2d 263
• Parties: Creighton E. MILLER, et al., Plaintiffs, v. PHILLIPS PETROLEUM COMPANY NORWAY, Defendant. . Submitted:
• Court: Delaware Superior Court

Page 263

529 A.2d 263

Creighton E. MILLER, et al., Plaintiffs, v. PHILLIPS PETROLEUM COMPANY NORWAY, Defendant.

Superior Court of Delaware,

New Castle County.

Submitted: June 24, 1986.

Decided: May 1, 1987.

Filed: May 4, 1987.

On Motion for Summary Judgment.

William T. Quillen (argued), Peter M. Sieglaff and Kent A. Jordan of Potter Anderson & Corroon, Wilmington, and Leonard C. Jaques of The Jaques Admiralty Law Firm, P.C., Detroit, Mich., of counsel, for plaintiffs.

Bruce M. Stargatt (argued), Frederick W. Iobst and William D. Johnson of Young, Conaway, Stargatt & Taylor, Wilmington, and Kenneth E. Rogers and Karen H. Brand of Phillips Petroleum Co., Houston, Tex., of counsel, for defendant.

BABIARZ, Judge.

The Alexander L. Kielland [the Kielland], a semi-submersible drilling rig, capsized in the Norwegian sector of the North Sea on March 27, 1980. Of the 212 people on board, 123 died. The plaintiffs in this action are 72 of the survivors and the administrator of the estates of 95 of the deceased. The defendant here is Phillips Petroleum Company Norway [Phillips Norway] which at the time of the incident was a wholly-owned subsidiary of Phillips Petroleum Company.

Phillips Norway is a Delaware corporation. The parties dispute where the principal place of business of the corporation is, but it appears clear that the board of directors meets and major business decisions are made in Bartlesville, Oklahoma. The day-to-day operations of the company, however, are carried out in Norway.

On July 15, 1976 Phillips Norway entered into a bare boat charter agreement with Stavanger Drilling II A/S [Stavanger Drilling], a Norwegian corporation, on behalf of itself and co-venturers in petroleum operations in the Greater Ekofisk Development [Ekofisk Field] in the Norwegian sector of the North Sea. Under the terms of the charter, Phillips Norway had exclusive dominion and control over the Kielland during the term of the agreement. The Kielland was a Norwegian flag vessel owned by Stavanger Drilling and never was in United States waters. Although it was built in France as a semi-submersible drilling rig, Phillips Norway used the Kielland as an accommodation rig (a "floating hotel") for off-duty workers in connection with the oil and gas operations in the North Sea. At the same time, Phillips Norway, as the bare boat charterer, entered into a personnel and services agreement with Stavanger Drilling by which Stavanger Drilling would man, navigate, operate and maintain the vessel to make it seaworthy, with the full right to direct the details of such operations. Both the charter agreement and the personnel and services agreement were entered into in Norway, both have a clause stating that they are to be governed by Norwegian law, and both were to expire on April 23, 1980.

The Norwegian government and courts have exercised jurisdiction over the scene of the accident. Both the government and the Stavanger, Norway police conducted official investigations into the Kielland's capsizing. It should be noted that neither Stavanger Drilling nor its personnel, nor the designer of the Kielland, nor the builder of the Kielland, nor the government and police investigators, nor the witnesses mentioned in the investigators' reports are within the subpoena power of this Court. Finally, I note that of the 167 plaintiffs only two claim American citizenship as dual nationals and none were domiciliaries of the United States at the time of the accident.

The plaintiffs had previously initiated actions against Phillips Norway in the United States District Court for the Northern District of Ohio. That Court dismissed the actions for lack of personal jurisdiction over Phillips Norway. The Sixth Circuit affirmed on September 17, 1984. The United States Supreme Court denied plaintiffs' petition for a writ of certiorari.

Stavanger Drilling and Phillips Norway have filed a petition in the City Court of Stavanger, Norway for a limitation of their liability pursuant to the provisions of Norway's Limitation of Liability statute. They have given proper notice to all persons as to the initiation of proceedings and have admonished all proper persons to file their claims in that action. A security of approximately forty million U.S. dollars was filed to pay all the claims in the proceedings. Apparently, under the statute, a failure to make a claim in that action will preclude the claimant from filing a claim in any other court or jurisdictions. Phillips Norway has represented to this Court that claims may still be filed in the Norwegian action.

It should also be noted that 202 of the 212 people on board the Kielland have executed general releases in Phillips Norway's favor. These releases provide that they are to be governed by Norwegian law. All who executed such releases were represented by counsel. Some who have given releases have still filed claims in the Norwegian courts. It is thus clear that the validity of these releases will be decided in whatever forum this case is eventually handled.

This Delaware action was filed on June 10, 1985. Phillips Norway now moves for summary judgment on the grounds of (1) lack of subject matter jurisdiction, and (2) forum non conveniens.

The plaintiffs assert causes of action under the Jones Act, 46 U.S.C. § 688, the Death on the High Seas Act, 46 U.S.C. § 761 et seq. [DOHSA], and general maritime law. The United States Supreme Court has set forth the "choice of law" principles by which a Court is to determine whether it should exercise jurisdiction over Jones Act claims. See Lauritzen v. Larsen, 345 U.S. 571, 583-591, 73 S.Ct. 921, 928-932, 97 L.Ed. 1254 (1953). The parties here acknowledge that there is no rational basis for a differentiation of treatment for choice of law purposes with regard to the DOHSA and general maritime law claims. See Romero v. International Terminal Operating Co., 358 U.S. 354, 382, 79 S.Ct. 468, 485, 3 L.Ed.2d 368 (1959); DeMateos v. Texaco, Inc., 3d Cir., 562 F.2d 895, 900-01 (1977), cert. denied 435 U.S. 904, 98 S.Ct. 1449, 55 L.Ed.2d 494 (1978). Thus, this Court shall consider each cause of action as one for the purpose of applying the "choice of law" principles. ¹

The Lauritzen case set out seven factors for consideration in determining jurisdiction. These factors are: (1) the place of the wrongful act; (2) the law of the flag; (3) the allegiance or domicile of the injured parties; (4) the allegiance of the defendant shipowner; (5) the place of contract; (6) the inaccessibility of the foreign forum; and (7) the law of the forum. Lauritzen, 345 U.S. at 583-91, 73 S.Ct. at 528-32. In Hellenic Lines Ltd. v. Rhoditis, 398 U.S. 306, 90 S.Ct. 1731, 26 L.Ed.2d 252 (1970), the Supreme Court noted that the Lauritzen list was not intended as exhaustive and that there may be other factors. The Court specifically listed one additional factor: the location of the shipowner's base of operations. Rhoditis, 398 U.S. at 309, 90 S.Ct. at 1734.

Jurisdiction will be found to exist only where there are substantial contacts between the facts of the case and the United States. This substantiality is not to be determined by balancing the presence of contacts against the absence of contacts, but rather by using an absolute scale of whether the factors present constitute a substantial contact. Phillips v. Amoco Trinidad Oil Co., 9th Cir., 632 F.2d 82, 86 (1980), cert. denied sub nom. Romilly v. Amoco Trinidad Oil Co., 451 U.S. 920, 101 S.Ct. 1999, 68 L.Ed.2d 312 (1981); Moncada v. Lemuria Shipping Corp., 2d Cir., 491 F.2d 470, 472, cert. denied 417 U.S. 947, 94 S.Ct. 3072, 41 L.Ed.2d 667 (1974). The Lauritzen-Rhoditis choice of law test is not a mechanical one. Rhoditis, 398 U.S. at 308, 90 S.Ct. at 1733. The factors are not accorded equal weight, and indeed the weight to be given to a factor will vary depending on the specific factual setting before the Court. Phillips v. Amoco Trinidad Oil Co., 632 F.2d at 85. The substantiality of the contacts may not be determined in a vacuum. Rather, they must be evaluated in light of "our self-regarding respect for the relevant interests of foreign nations". Romero v. International Terminal Operating Co., 358 U.S. at 382-83, 79 S.Ct. at 485-86; Phillips v. Amoco Trinidad Oil Co., 632 F.2d at 85. To determine the relevant interests of other nations, there must be an evaluation of the "points of contact between the transaction and the states or governments whose competing laws are involved." Lauritzen, 345 U.S. at 582, 73 S.Ct. at 928. Keeping these guidelines firmly in mind, I now turn to applying the Lauritzen-Rhoditis test to the facts before the Court.

Place of the Wrongful Act. The Lauritzen Court placed little emphasis on the location test as a choice of law indicator, noting that "however sufficient for torts ashore, [it] is of limited application to shipboard torts, because of the varieties of legal authority over waters she may navigate." Lauritzen, 345 U.S. at 583, 73 S.Ct. at 929. While this criticism is accurate with regard to regular commercial sailing vessels, it has been held inapplicable to vessels such as drilling rigs whose location is fixed. See Chiazor v. Transworld Drilling Co., 5th Cir., 648 F.2d 1015, 1019 (1981), cert. denied 455 U.S. 1019, 102 S.Ct. 1714, 72 L.Ed.2d 136 (1982); Phillips v. Amoco Trinidad Oil Co., 632 F.2d at 87. In the present case, the Kielland was used as a stationed accommodation rig. Though moveable, its location at the time of the accident was fixed, and had been so for a substantial period of time. The Kielland was not floating through "varieties of legal authority," as was the ship in Lauritzen. Thus, under these facts, the "place of the wrongful act" test should be given more weight. The place of the act was in the Norwegian sector of the North Sea, and thus affords no support for the application of American law in this case.

The Law of the Flag. The Lauritzen Court placed its greatest emphasis on the law...