Perkins v. Entergy Corporation, No. 2009 CA 0632 (La. App. 6/10/2010)
| Decision Date | 10 June 2010 |
| Docket Number | No. 2009 CA 0632.,Consolidated with No. 2009 CA 0633.,Consolidated with No. 2009 CA 0634.,2009 CA 0632. |
| Parties | DON A. PERKINS, INDIVIDUALLY AND AS ADMINISTRATOR OF THE MINOR CHILDREN, ROSS ALAN PERKINS, BRITTANY NICOLE PERKINS, AND KURT MICHAEL PERKINS, AND CYNTHIA E. PERKINS, INDIVIDUALLY AND AS ADMINISTRATRIX OF THE MINOR CHILD HOWARD MACK HUGHES v. ENTERGY CORPORATION, LOUISIANA POWER & LIGHT COMPANY, GULF STATES UTILITIES COMPANY, INCORPORATED, AIR LIQUIDE AMERICA CORPORATION, BIG THREE INDUSTRIES, INC., DRESSER INDUSTRIES, INC., MASONEILAN INTERNATIONAL, EXXON CORPORATION, HIGHLANDS INSURANCE COMPANY. JOSEPH E. BUJOL, III, INDIVIDUALLY AND AS ADMINISTRATOR OF THE MINOR CHILDREN, DEREK BUJOL, DUSTIN BUJOL, AND DEVIN BUJOL AND TINA HEBERT BUJOL v. ENTERGY CORPORATION, LOUISIANA POWER & LIGHT COMPANY, GULF STATES UTILITIES COMPANY, INCORPORATED, AIR LIQUIDE AMERICA CORPORATION, BIG THREE INDUSTRIES, INC., DRESSER INDUSTRIES, INC., MASONEILAN INTERNATIONAL, EXXON CORPORATION, HIGHLANDS INSURANCE COMPANY. ROBERT HRACEK, FRANK E. HRACEK AND ERIC RAY HRACEK v. ENTERGY CORPORATION, LOUISIANA POWER & LIGHT COMPANY, GULF STATES UTILITIES COMPANY, INCORPORATED, AIR LIQUIDE AMERICA CORPORATION, BIG THREE INDUSTRIES, INC., DRESSER INDUSTRIES, INC., MASONEILAN INTERNATIONAL, EXXON CORPORATION. |
| Court | Court of Appeal of Louisiana — District of US |
JAY RUSSELL SEVER, New Orleans, Louisiana, Attorney for Intervenor/Appellee Great American Assurance Company d/b/a/ Agricultural Insurance Company.
RALPH S. HUBBARD, III., TINA L. KAPPEN, New Orelans, Louisiana, Attorneys for Intervenor/Appellee Travelers Casualty and Surety Company d/b/a AETNA Casualty & Surety Company.
EDWARD T. HAYES, New Orleans, Louisiana, Attorney for Defendant/Appellee Royal Indemnity Company.
T. JUSTIN SIMPSON, Metairie, Louisiana, Attorney for Defendant/Appellee Hartford Casualty Insurance Company.
JOHN P. WOLFF, III, Baton Rouge, Louisiana, Attorney for Defendant/Appellee Federal Insurance Company.
RALPH H. WALL, LOUIS C. LaCOUR, Jr., LAURIE B. YOUNG, LAUREN J. DELERY, New Orleans, Louisiana, Attorneys for Defendant/Appellant National Union Fire Insurance Company of Pittsburgh, PA.
THOMAS E. SCHWAB, New Orleans, Louisiana, Attorney for Defendant/Appellee X.L. Insurance Company.
PATRICK W. PENDLEY, Plaquemine, Louisiana, Attorney for Defendant/Appellee The Big Three Insurers.
MELVIN A. ELDEN, Lafayette, Louisiana, Attorney for Defendant/Appellee Reliance Insurance Company.
BEFORE: PARRO, KUHN, AND McDONALD, JJ.
National Union Fire Insurance Company of Pittsburgh, PA (National Union) appeals from two summary judgments, the first finding that a policy issued by National Union afforded coverage for injuries suffered by three employees of its insured, Air Liquide America Corporation (ALAC), and the second ordering National Union to pay over $17 million (including interest) in contribution toward the settlement of the injured employees' claims. We affirm.
On April 6, 1994, ALAC operated an air-separation facility near Plaquemine, Louisiana, which produced oxygen, nitrogen, and argon.1 An oxygen flash fire and explosion occurred at the ALAC facility after an electrical disturbance and while three employees were assisting in restarting the plant. They were near the end of the task of restarting the plant when an operating problem developed in the "let-down station." An automatic control valve was regulating differential pressures between a 700-pound oxygen pipeline supplying one customer, Exxon, and a 400-pound pipeline supplying other customers. The employees were closing an eight-inch manual isolation valve upstream from the automatic control valve when the plant manager told them to stop. He then climbed inside the loop of piping that formed the let-down station while the other men watched, standing close enough to the automatic control valve to see it cycle open and then abruptly close. The flash fire erupted with catastrophic results.2
L'Air Liquide, Societe Anonyme pour L'Etude et L'Exploitation des Procedes Georges Claude (ALSA) is a multinational company headquartered in France. In the 1960s, ALSA was distributing pressurized oxygen by pipeline in France and Belgium. In the early 1970s, the company began expanding and, by the 1990s, ALSA's corporate family operated in at least 60 countries, including the United States.
In 1986, ALSA acquired Big Three Industries, Inc. (Big Three), a major oxygen pipeline systems operator in the United States that operated air-separation plants throughout the Gulf South, including the Plaquemine plant, for $1,000,500,000, making Big Three a part of the ALSA family of companies and adding approximately 15 plants in Louisiana, Mississippi, and Texas to the ALSA list of subsidiaries.
The Big Three plants continued to operate under the Big Three name until January 1, 1994, when the Big Three division merged with its sister subsidiary, Liquid Air Corporation, forming the new subsidiary ALAC. Though ALSA is the ultimate majority shareholder of ALAC, it is not its direct parent. Through a mechanism described as "cascading ownership," ALSA owns the majority of shares of Air Liquide International, S.A., which owns the majority of shares of American Air Liquide, Inc., which owns the majority of shares of AL America Holdings, Inc., which owns the majority of shares of ALAC. Thus, ALSA is the corporate ancestor of ALAC, which, as of January 1, 1994, is the owner of the Plaquemine plant and employer of the injured men at the time of the accident. Neither the original acquisition nor the subsequent merger affected the physical operation of the Plaquemine plant, which kept the same executives, plant manager, and workers who formerly operated under the Big Three ownership.
The underlying plaintiffs filed suit on March 19, 1995. On October 1, 1996, ALAC filed a Motion for Partial Summary Judgment against the insurance providers for Big Three (Big Three Insurers) seeking a determination that the policies issued by the Big Three Insurers covered the underlying accident and subsequent injuries. The Big Three Insurers denied coverage, but the trial court ruled in favor of ALAC. This Court determined that a genuine issue of material fact existed as to coverage, reversed the judgment and remanded the case. The Big Three Insurers subsequently settled the claims against ALAC.
The Big Three Insurers filed a motion for partial summary judgment seeking a determination that National Union insured ALAC for its liabilities arising out of its ownership and operation of the Plaquemine plant at the time of the accident. That motion was granted on March 1, 1999. However, the Big Three Insurers' contribution claim against National Union was stayed until all underlying claims were resolved.
In January 2007, the Big Three Insurers filed a motion for partial summary judgment seeking an allocation of the $34.5 million payment, plus interest, among all of ALAC's insurers, including National Union. National Union filed a cross-motion challenging the right of contribution and the reasonableness of the settlement amount. The Big Three Insurers responded with a cross-motion for summary judgment. The trial court granted the Big Three Insurers' motion and awarded principal and pre-judgment interest against National Union in excess of $17 million.
After a decade and a half of litigation, the only remaining dispute is whether National Union, an insurer of ALAC and the appellant in this case, must contribute a percentage of the settlement of ALAC's liability already paid to the underlying plaintiffs by the Big Three Insurers. National Union contends that its policy did not afford coverage for the underlying accident and, therefore, it has no obligation to contribute. National Union further contends that, even if its policy did afford coverage, it does not have a solidary obligation to contribute to the settlement.
An appellate court reviews a district court's decision to grant a motion for summary judgment de nevo, using the same criteria that govern the district court's consideration of whether summary judgment is appropriate. Smith v. Our Lady of the Lake Hosp., Inc., 93-2512, p. 26 (La. 7/5/94), 639 So.2d 730, 750. Summary judgment shall be rendered if there is no genuine issue as to a material fact and the mover is entitled to judgment as a matter of law. Power Marketing Direct, Inc. v. Foster, 2005-2023, p. 9 (La. 9/6/06), 938 So.2d 662, 669. A summary judgment may be rendered on the issue of insurance coverage alone, although there is a genuine issue as to liability or the amount of damages. Bilbo for Basnaw v. Shelter Ins. Co., 96-1476, p. 5 (La. App. 1st Cir. 7/30/97), 698 So.2d 691, 694, writ denied, 97-2198 (La. 11/21/97), 703 So.2d 1312.
When the issue before the court is one on which the party bringing the summary judgment motion will bear the burden of proof at trial, the burden of showing there is no genuine issue of material fact remains with the party bringing the motion. Buck's Run Enterprises, Inc. v. Mapp Const., Inc., 99-3054, p. 4 (La. App. 1st Cir. 2/16/01), 808 So.2d 428, 431. An insurer seeking to avoid coverage through summary judgment bears the burden of proving some exclusion applies to preclude coverage. Lewis v. Jabbar, 2008-1051, p. 5 (La. App. 1st Cir. 1/12/09), 5 So.3d 250, 254-55 ().
An insurance policy is a contract between the parties and should be construed employing the general rules of interpretation of contracts...
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