Vaz Borralho v. Keydril Co.

Citation696 F.2d 379
Decision Date27 January 1983
Docket NumberNo. 81-2436,81-2436
PartiesMaria Arlete VAZ BORRALHO, et al., Plaintiffs-Appellants, v. KEYDRIL COMPANY, Key International Drilling Company, Ltd. and Key Perfuracoes Maritimas, Ltda., Defendants-Appellees. Summary Calendar.
CourtUnited States Courts of Appeals. United States Court of Appeals (5th Circuit)

Benton Musslewhite, Robert A. Chaffin, Houston, Tex., for plaintiffs-appellants.

Ted C. Litton, Houston, Tex., for defendants-appellees.

Appeal from the United States District Court for the Southern District of Texas.

Before RUBIN, JOHNSON and GARWOOD, Circuit Judges.

GARWOOD, Circuit Judge:

This is an appeal from a judgment dismissing a wrongful death action brought by the appellants under the Jones Act, 46 U.S.C. Sec. 688, and the general maritime law of the United States, and alternatively under the Death on High Seas Act, 46 U.S.C. Sec. 761, and the Texas Wrongful Death Statute, Tex.Rev.Civ.Stat.Ann. art. 4671. Appellants are the survivors of a Brazilian seaman who died as a result of injuries sustained on board a submersible drilling rig, the KEY WEST, located off the Brazilian coast. The district court dismissed appellants' action against appellees on the ground of forum non conveniens. The primary question is whether the fact that American-based corporations owned the business entities which employed the decedent and owned the drilling rig upon which he was injured constitutes a substantial contact with the United States warranting the application of American law to appellants' lawsuit. We hold that, in the context of this case, the contacts with the United States are insubstantial when compared with those to Brazil, and that the district court, in dismissing appellants' action, did not abuse its discretion. However, because the order of dismissal was made unconditionally, we reverse and remand the case so that the district court may adequately protect the appellants' interests by fashioning an order of dismissal based upon appropriate conditions.

I. FACTS

The KEY WEST was built in the United States in 1974. Ever since its construction, the KEY WEST has been stationed off the coast of Brazil, first at Belem and then, sometime after the incident in suit, at Fortaleza, drilling for petroleum products for the Brazilian national oil company, Petrobas, under a charter agreement between Petrobas and the owner of the KEY WEST KIDC and appellee Keydril Company ("Keydril"), a Delaware corporation, whose shares are also owned by Gulf, owned appellee Key Perfuracoes Maritimas, Ltda. ("KPM"), a Brazilian limited liability business entity, which was formed at Petrobas's insistence and was under contract to it to drill for petroleum products, using the KEY WEST as the drilling rig. KIDC guaranteed KPM's performance under this contract.

appellee Key International Drilling Company, Ltd. ("KIDC"). KIDC is a Bermudian corporation whose shares are ultimately owned by Gulf Oil Corporation ("Gulf"). Although owned by a Bermudian corporation, the KEY WEST is registered in Liberia and flies the Liberian flag.

On February 18, 1974, the decedent, Prisco Da Silva Borralho ("Borralho"), a resident and citizen of Brazil, entered into a contract with KPM in Belem, Brazil, which obligated him to work as its employee on board the KEY WEST. This contract, which was written in Portuguese, provided, among other things, that Belem would be the forum for "all questions derived or resulting from" the contract. On or about March 1, 1977, Borralho injured his leg on board the KEY WEST. He was taken ashore for treatment and died in a Brazilian hospital two days later from an embolism.

Appellants, 1 who are all Brazilian citizens and residents of Para, Brazil, filed suit against Keydril, KIDC, and KPM in the federal district court for the Southern District of Texas for damages arising out of Borralho's injuries and death under the Jones Act and the general maritime law of the United States, and alternatively under the Death on the High Seas Act and "the Wrongful Death Statutes of the State of Texas." 2 Appellants, however, asserted no claim under Brazilian law.

Appellees responded to appellants' complaint by interposing various defenses under Fed.R.Civ.P. 12(b) 3 in their answers, and afterwards, together they filed a motion to dismiss the complaint based on the doctrine of forum non conveniens. In support of their motion, appellees filed the affidavit of Virgil Stone, the President of Keydril and KIDC, whose deposition was later taken by appellants and filed with the district court. 4 Stone's testimony revealed that KPM was not qualified to do business in the United States; that neither KPM nor KIDC derived any income from operations conducted in the United States; and that KPM had "shoreside managerial people" in Brazil "who direct[ed] the operation of" the KEY WEST. 5

After considering the choice of law factors of Lauritzen v. Larsen, 345 U.S. 571, 73

S.Ct. 921, 97 L.Ed. 1254 (1952) and Hellenic Lines, Ltd. v. Rhoditis, 398 U.S. 306, 90 S.Ct. 1731, 26 L.Ed.2d 252 (1970), the district court decided that American law did not apply to the appellants' lawsuit. The court then considered the forum non conveniens factors of Gulf Oil Corporation v. Gilbert, 330 U.S. 501, 506-507, 67 S.Ct. 839, 842, 91 L.Ed. 1055 (1947), and dismissed the case without prejudice. The order of dismissal was made unconditionally.

II. STANDARD OF REVIEW

Before a district court dismisses a case based on the doctrine of forum non conveniens, it should first ascertain whether American or foreign law governs the lawsuit. 6 If American law applies, then the district court should normally retain jurisdiction and proceed with the case. If, however, foreign law does apply and the foreign forum is accessible, then the district court should determine in which forum the case should be tried, and if it decides that the lawsuit should be tried in the foreign forum, then the court should decline to exercise jurisdiction over the case. Fisher v. Agios Nicolaos V, 628 F.2d 308, 315 (5th Cir.1980), cert. denied, sub nom, Valmas Brothers Shipping, S.A. v. Fisher, 454 U.S. 816, 102 S.Ct. 92, 70 L.Ed.2d 84 (1981).

While the choice of law determination is generally subject to our de novo review, Phillips v. Amoco Trinidad Oil Company, 632 F.2d 82, 84 (9th Cir.1980), cert. denied, sub nom, Romilly v. Amoco Trinidad Oil Company, 451 U.S. 920, 101 S.Ct. 1999, 68 L.Ed.2d 312 (1981), "the forum non conveniens determination is committed to the sound discretion of the trial court." Piper "[W]here by application of the Lauritzen factors the correct choice of law decision is to apply foreign law (and a foreign forum is accessible), a district court's discretion in granting a forum non conveniens dismissal will not ordinarily be disturbed on review." Fisher, 638 F.2d at 315.

                Aircraft Company v. Reyno, 454 U.S. 235, 257, 102 S.Ct. 252, 266, 70 L.Ed.2d 419, 436 (1981).  We may reverse a district court's decision on a motion to dismiss based on forum non conveniens only if its action constitutes a clear abuse of discretion.   Chiazor v. Transworld Drilling Company, Ltd., 648 F.2d 1015, 1017-1018 (5th Cir.1981), cert. denied, --- U.S. ----, 102 S.Ct. 1714, 72 L.Ed.2d 136 (1982).
                
III. CHOICE OF LAW

Appellants' first contention is that there were disputed material issues of fact respecting the choice of law determination that should have been reserved for trial on the merits and referred to a jury for determination and not decided by the district court. 7 They argue that under Fed.R.Civ.P. 12(b)(6), the appellees' motion to dismiss must be treated as a motion for summary judgment under Fed.R.Civ.P. 56, and as such, all factual questions must be resolved in their favor.

An objection based on the doctrine of forum non conveniens is not governed by Rule 12. The objection is not based on improper venue, which must be asserted by preliminary motion or answer. "The doctrine does not come into play unless the court in which the action is brought has both subject matter and personal jurisdiction and is proper venue." 12 Wright & Miller, Federal Practice & Procedure: Civil, Sec. 3288; Gulf, 330 U.S. at 507, 67 S.Ct. at 842. As stated by the Third Circuit in Dahl v. United Technologies Corp., 632 F.2d 1027, 1029 (3d Cir.1980):

"The principle of forum non conveniens permits a court to decline jurisdiction even though venue and jurisdiction are proper, on the theory that for the convenience of the litigants and the witnesses, the action should be tried in another judicial forum."

The question raised by appellants' contention concerns the manner in which the factual issues raised in connection with forum non conveniens are resolved. For the reasons below, we think that the answer to this question is found in the cases which deal with motions to transfer under 28 U.S.C. Sec. 1404(a).

In 1948, Sec. 1404(a) became effective. It was drafted in accordance with the doctrine of forum non conveniens, permitting transfer to a more convenient federal forum, even though venue was proper. The statute "has, in effect, codified and replaced this doctrine whenever the more convenient tribunal is the United States District Court where the action 'might have been brought.' " Vanity Fair Mills, Inc. v. T. Eaton Company, 234 F.2d 633, 645 (2d Cir.); cert. denied, 352 U.S. 871, 77 S.Ct. 96, 1 L.Ed.2d 76 (1956); 15 Wright, Miller & Cooper, Sec. 3841. Since the doctrine of forum non conveniens has been incorporated into Sec. 1404(a), the decisions respecting the procedure and mode of resolving the issues raised in connection with motions to transfer and motions to dismiss based on forum In Castanho v. Jackson Marine, Inc., 650 F.2d 546, 550 (5th Cir.1981), this Court adopted the standard used for the consideration of a petition for mandamus, sought in the context of a district court's decision on a Sec. 1404(a) motion to transfer, to pass on a petition for mandamus seeking to direct the district court to...

To continue reading

Request your trial
73 cases
  • Neal v. Barisich, Inc., Civil A. No. 88-3119.
    • United States
    • U.S. District Court — Eastern District of Louisiana
    • February 28, 1989
    ...that suggests that pre-death pain and suffering awards in admiralty may be by way of state survival statutes. Vaz Borralho v. Keydril Co., 696 F.2d 379, 394 n. 6 (5th Cir.1983) (acknowledging this dictum, but "not directly addressing these matters"); see also Hamilton v. Canal Barge Co., 39......
  • Miller v. Phillips Petroleum Co. Norway
    • United States
    • United States State Supreme Court of Delaware
    • September 15, 1987
    ...Air Crash Disaster Near New Orleans, La. on July 9, 1982, 821 F.2d 1147, 1163 n. 25 (5th Cir.1987) (en banc).14 See Vaz Borralho v. Keydril Co., 696 F.2d 379 (5th Cir.1983) (Brazilian law applied to injury of Brazilian seamen on U.S. owned rig off coast of Brazil), overruled on other ground......
  • Tallentire v. Offshore Logistics, Inc.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (5th Circuit)
    • March 15, 1985
    ...S.Ct. 89, 66 L.Ed. 210 (1921); THE TUNGUS v. Skovgaard, 358 U.S. 588, 79 S.Ct. 503, 3 L.Ed.2d 524 (1959).4 See Vaz Borralho v. Keydril Co., 696 F.2d 379, 384 n. 6 (5th Cir.1983) (DOHSA likely preempts state wrongful death remedies; citing Higginbotham ).5 46 U.S.C. Sec. 762:[T]he recovery i......
  • Coats v. Penrod Drilling Corp.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (5th Circuit)
    • October 18, 1993
    ...v. Phillips Petroleum Co., 730 F.2d 211 (5th Cir.1984); Bailey v. Dolphin Int'l, Inc., 697 F.2d 1268 (5th Cir.1983); Vaz Borralho v. Keydril Co., 696 F.2d 379 (5th Cir.1983); Chiazor v. Transworld Drilling Co., 648 F.2d 1015 (5th The one exception is Fogleman, where we refused to allow an A......
  • Request a trial to view additional results
1 books & journal articles

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT