analyzing whether forward freight agreements were maritime contracts
How later courts described this case
- analyzing whether forward freight agreements were maritime contracts
- analyzing whether an insurance contract was maritime
- “[T]he trend in modern admiralty case law . . . is to focus the jurisdictional inquiry upon whether the nature of the transaction was maritime.”
- finding wireline services nonmaritime in nature
Written by the judges who cited it.
The opinion
Case: 16-30217 Document: 00514299129 Page: 1 Date Filed: 01/08/2018
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
Fifth Circuit
FILED
January 8, 2018
No. 16-30217
Lyle W. Cayce
Clerk
In Re: In the Matter of the Complaint of Larry Doiron, Incorporated as
Owner and Operator of the Barge Pogo and M/V Billy Joe for Exoneration
from or Limitation of Liability
LARRY DOIRON, INCORPORATED,
Plaintiff – Appellee
ROBERT JACKSON,
Intervenor Plaintiff – Appellee
v.
SPECIALTY RENTAL TOOLS & SUPPLY, L.L.P.; OIL STATES ENERGY
SERVICES, L.L.C.; ZURICH AMERICAN INSURANCE COMPANY,
Defendants – Appellants.
Appeal from the United States District Court
for the Western District of Louisiana
Case: 16-30217 Document: 00514299129 Page: 2 Date Filed: 01/08/2018
No. 16-30217
Before STEWART, Chief Judge, and JOLLY*, DAVIS**, JONES, SMITH,
DENNIS, CLEMENT, PRADO, OWEN, ELROD, SOUTHWICK, HAYNES,
GRAVES, HIGGINSON and COSTA, Circuit Judges.***
W. EUGENE DAVIS, Circuit Judge.
We took this case en banc to consider modifying the criteria set forth in
Davis & Sons, Inc. v. Gulf Oil Corp. for determining whether a contract for
performance of specialty services to facilitate the drilling or production of oil
or gas on navigable waters is maritime. 1 After briefing and argument, the
Court has decided to adopt a simpler, more straightforward test consistent
with the Supreme Court’s decision in Norfolk Southern Railway Co. v. Kirby
for making this determination. 2
I. BACKGROUND
On October 12, 2005, Apache Corporation (“Apache”) entered into a
blanket master services contract (“MSC”) with Specialty Rental Tools &
Supply, L.L.P. (“STS”). The MSC included an indemnity provision running in
favor of Apache and its contractors. 3 In early 2011, Apache issued an oral work
order directing STS to perform “flow-back” services on a gas well in navigable
waters in Louisiana in order to remove obstructions hampering the well’s flow.
A stationary production platform provided the only access to the gas well. The
work order did not require a vessel, and neither Apache nor STS anticipated
that a vessel would be necessary to perform the job.
* Judge Jolly, now a Senior Judge of this court, participated in the consideration of
this en banc case.
** Judge Davis, now a Senior Judge of this court, is participating as a member of the
original panel.
***Judges Willett and Ho, were not on the court when this case was heard en banc.
1 See 919 F.2d 313 (5th Cir. 1990).
2 See 543 U.S. 14 (2004).
3 A more exhaustive factual background can be found in the panel opinion. See In re
Larry Doiron, Inc., 869 F.3d 338, 340–41 (5th Cir. 2017).
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On February 24, 2011, STS dispatched a two-man crew to perform the
work required by the work order. After an unsuccessful day of work, the STS
crew determined that some heavy equipment was needed to complete the job
and that a crane would be required to lift the equipment into place. Because
the production platform was too small to accommodate a crane, the crew
suggested to Apache that it engage a barge equipped with a crane to lift the
equipment. Apache agreed and contracted with Plaintiff Larry Doiron, Inc.
(“LDI”), to provide a crane barge.
The next day, the LDI crew proceeded to the job site on the crane barge
POGO and unloaded the equipment requested by the STS crew. After being
unsuccessful, however, the STS crew discovered that it needed yet a different
piece of equipment, so, with the aid of the crane, both crews began removing
the heavy equipment previously unloaded. During this process, the LDI crane
operator struck and injured one of the STS crewmembers, Peter Savoie, with
the equipment.
Anticipating a claim from Mr. Savoie, LDI filed a limitation of liability
proceeding as owner of the crane barge POGO. Savoie filed a claim in the
limitation proceeding. LDI, as Apache’s contractor, then filed a third-party
complaint against STS, seeking indemnity under the terms of the MSC.
LDI filed a motion for summary judgment seeking a declaration that it
was entitled to indemnity from STS under the MSC. STS filed a cross-motion
for summary judgment seeking a determination that it owed no indemnity.
The narrow issue presented was whether the MSC was a maritime contract.
If so, general maritime law permitted enforcement of the indemnity provision.
If not, Louisiana law controlled, and the Louisiana Oilfield Indemnity Act
(“LOIA”) precluded indemnity. 4 The district court concluded that maritime
4 See LA. REV. STAT. § 9:2780(A).
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law applied and awarded LDI indemnity from STS. Our panel affirmed that
judgment on appeal. A majority of the active judges then voted to take the case
en banc.
II. DISCUSSION
A. Standard of Review
We review de novo a district court’s grant of summary judgment. 5
Summary judgment is proper “if the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a
matter of law.” 6 A genuine dispute exists if a reasonable jury could find in
favor of the nonmoving party. 7 All facts and evidence are viewed in the light
most favorable to the nonmovant. 8 We turn first to the existing law on
maritime contracts in this circuit.
B. Current Law
The issue in this case is whether the Court should apply maritime law
or Louisiana law to determine the validity of the indemnity provisions in the
MSC. If Louisiana law applies, the indemnity agreement is void as against
public policy. 9 If, on the other hand, the contract is maritime and state law
does not apply, then the indemnity obligation is enforceable. 10
5 James v. State Farm Mut. Auto. Ins. Co., 743 F.3d 65, 68 (5th Cir. 2014).
6 FED. R. CIV. P. 56(a).
7 Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
8 James, 743 F.3d at 68.
9 See LA. REV. STAT. § 9:2780(A).
10 See Hoda v. Rowan Cos., 419 F.3d 379, 380 (5th Cir. 2005).
LDI also argues that the choice-of-law clause in the MSC, which specifies general
maritime law as the applicable law under which to construe the contract, should be enforced
even if the contract is nonmaritime in nature.
Our case law makes clear that, if the contract is nonmaritime, Louisiana law will
govern its construction even in the face of a choice-of-law clause. This is so because
enforcement of the choice-of-law clause would violate Louisiana’s public policy and directly
contravene LOIA. See Verdine v. Ensco Offshore Co., 255 F.3d 246, 254 (5th Cir. 2001).
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Our cases in this area have long been confusing and difficult to apply. In
Thurmond v. Delta Well Surveyors, Judge Garwood stated in his concurring
opinion that he was “generally in agreement with Judge Wisdom’s persuasive
opinion, but . . . troubled by the tension, or perhaps outright inconsistency,
between many of our opinions in this area.” 11 He elaborated that:
[I]t seems to me that it may be desirable to consider this issue en
banc, in order that we may take a more consistent approach to the
question of whether and in what circumstances activities in
connection with mineral development in state territorial waters
are maritime (or perhaps “maritime and local[.]”)] 12
Since 1990, we have followed the multi-factor test set forth in Davis &
Sons, Inc. v. Gulf Oil Corp. (“Davis & Sons”) to determine whether a contract
is a maritime contract. 13 Judge Rubin, in attempting to summarize and make
sense of our case law, set forth numerous guiding principles:
If . . . the contract consists of two parts, a blanket contract followed
by later work orders, the two must be interpreted together in
evaluating whether maritime or land law is applicable to the
interpretation and enforceability of the contract’s provisions. The
blanket contract is not of itself complete and calls for no specific
work. The actual contract between the parties therefore consists
of the blanket agreement as modified by the later work order. 14
He stated further:
A contract may either contain both maritime and non-maritime
obligations . . . . If separable maritime obligations are
imposed . . . , these are maritime obligations that can be
separately enforced in admiralty without prejudice to the rest,
hence subject to maritime law. 15
Whether the blanket agreement and work orders, read together,
do or do not constitute a maritime contract depends, as does the
11 836 F.2d 952, 957 (5th Cir. 1988) (Garwood, J., concurring).
12 See id. (quoting Kossick v. United Fruit Co., 365 U.S. 731, 738 (1961)).
13 919 F.2d at 316.
14 Id. at 315.
15 Id. at 315–16 (internal quotation marks, brackets, and citations omitted).
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characterization of any other contract, on the nature and character
of the contract, rather than on its place of execution or
performance. A contract relating to a ship in its use as such, or to
commerce or navigation on navigable waters, or to transportation
by sea or to maritime employment is subject to maritime law.
What constitutes maritime character is not determinable by
rubric. The Supreme Court has resorted to the observation that a
contract is maritime if it has a genuinely salty flavor. 16
He concluded his synopsis by distilling these principles into the six-factor test
at issue in this appeal:
Determination of the nature of a contract depends in part on
historical treatment in the jurisprudence and in part on a fact-
specific inquiry. We consider six factors in characterizing the
contract: 1) what does the specific work order in effect at the time
of injury provide? 2) what work did the crew assigned under the
work order actually do? 3) was the crew assigned to work aboard
a vessel in navigable waters? 4) to what extent did the work being
done relate to the mission of that vessel? 5) what was the principal
work of the injured worker? and 6) what work was the injured
worker actually doing at the time of injury? 17
A number of judges on this Court have since criticized this approach as
confusing, particularly the six-factor, fact-intensive test. 18 In Hoda v. Rowan
Cos., Judge Jones began the opinion by stating that:
This appeal requires us to sort once more through the authorities
distinguishing maritime and non-maritime contracts in the
offshore exploration and production industry. As is typical, the
final result turns on a minute parsing of the facts. Whether this
is the soundest jurisprudential approach may be doubted,
inasmuch as it creates uncertainty, spawns litigation, and hinders
the rational calculation of costs and risks by companies
16 Id. at 316 (internal quotation marks and citations omitted).
17 Id.
18 See, e.g., Hodgen v. Forest Oil Corp., 87 F.3d 1512, 1523 n.8 (5th Cir. 1996),
(collecting cases expressing frustration with the inconsistent analysis of maritime contracts),
overruled on other grounds by Grand Isle Shipyard, Inc. v. Seacor Marine, LLC, 589 F.3d 778,
788 (5th Cir. 2009) (en banc); Hoda, 419 F.3d at 380.
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participating in this industry. Nevertheless, we are bound by the
approach this court has followed for more than two decades. 19
Professor David W. Robertson has also pointed out some of the difficulties with
the Davis & Sons test:
The six factors are too pointillistic: they have led Fifth Circuit
panels down such odd lines of thought as “whether drilling mud
services are more akin to wireline work [which has sometimes
been viewed as quintessentially nonmaritime] or to casing
services.” 20
For a variety of reasons, most of the prongs of the Davis & Sons test are
unnecessary and unduly complicate the determination of whether a contract is
maritime. Judge Southwick’s complex factual explication of the prongs in the
panel opinion—which we consider below—demonstrates this point. 21
The first Davis & Sons’ prong asks: What does the contract provide? 22
This is clearly an appropriate consideration in any contract case: the language
of the contract. In this case, the contract consists of both the blanket MSC and
the oral work order, which must be read together. 23
The second prong asks: What did the crew actually do? 24 Analyzing this
prong required the panel to parse the precise facts related to the services
19 419 F.3d at 380.
20 David W. Robertson, The Outer Continental Shelf Lands Act’s Provisions on
Jurisdiction, Remedies, and Choice of Law: Correcting the Fifth Circuit’s Mistakes, 38 J.
MAR. L. & COM. 487, 545 (2007). For a more detailed criticism of the Davis & Sons test, see
id. at 540–45.
21 See generally In re Doiron, 869 F.3d.
22 Davis & Sons, 919 F.2d at 316.
23 STS argues that the following provision in the MSC contemplates the use of a vessel:
“IF CONTRACTOR [STS] USES ANY VESSELS IN CONNECTION WITH ITS WORK FOR
COMPANY OR COMPANY GROUP,” additional vessel-related insurance is required.
(emphasis added).
This insurance provision on its face has no application because STS did not provide or
use a vessel—the vessel and crew were provided by LDI. This provision requiring vessel-
related insurance applied to contractors such as LDI.
24 Davis & Sons, 919 F.2d at 316.
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performed under the contract and determine whether those services were
inherently maritime. Because none of our previous case law had considered
the flow-back services at issue here and whether they were inherently
maritime, the panel attempted to analogize flow-back services to other services
considered in previous opinions. 25 This required the panel to give a detailed
description of both this case and the analogous cases, comparing flow-back
services to casing, wireline, and welding services. 26 In doing so, the panel
added to the many pages dedicated to similar painstaking analyses in the
Federal Reporter. 27 The fact is, none of these services are inherently maritime.
As discussed below, the focus should be on whether the contract calls for
substantial work to be performed from a vessel.
The third and fourth Davis & Sons prongs ask: Was the crew assigned
to a vessel in navigable waters, and to what extent was the crew’s work related
to the mission of the vessel? 28 These facts would be relevant if we were
required to decide whether the crew members were seamen but not relevant to
whether the employer of the crewmembers entered into a maritime contract.
The fifth prong asks: What was the principal work of the injured worker? 29
25 See In re Doiron, 869 F.3d at 343.
26 See id. at 344–46.
27 Compare Thurmond, 836 F.2d at 956 (finding wireline services nonmaritime in
nature); Domingue v. Ocean Drilling & Expl. Co., 923 F.2d 393, 398 (5th Cir. 1991) (same),
with Corbitt v. Diamond M. Drilling Co., 654 F.2d 329, 332 (5th Cir. Unit A Aug. 1981)
(finding casing services to be maritime in nature), and Campbell v. Sonat Offshore Drilling,
Inc., 979 F.2d 1115, 1124–25 (5th Cir. 1992) (same); see also Kenneth G. Engerrand, Primer
of Remedies on the Outer Continental Shelf, 4 LOY. MAR. L.J. 19, 61–63 (2005) (noting that
historically, some service contracts are considered maritime in nature, including drilling and
workover, casing, catering, repair, and well-site supervision, while other services contracts
are traditionally nonmaritime in nature, including wireline work, testing and completion
operations).
28 Davis & Sons, 919 F.2d at 316.
29 See id.
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Again, this is not relevant to whether the injured worker’s employer entered
into a maritime contract.
The sixth prong asks: What was the injured worker doing when
injured? 30 The facts surrounding the accident are relevant to whether the
worker was injured in a maritime tort, but they are immaterial in determining
whether the worker’s employer entered into a maritime contract.
In our panel opinion, after exhaustively analyzing the facts of this case
in light of the six-prong test, we limited our holding to the facts of this case and
determined that the contract was maritime primarily because a vessel was
essential to the completion of the job. 31
C. Kirby
Fortunately, the Supreme Court’s opinion in Norfolk Southern Railway
Co. v. Kirby lights a path to a simpler, more straightforward method for
determining whether a contract is maritime and avoids most of the
unnecessary analysis required by Davis & Sons. 32 In Kirby, the Supreme
Court considered a claim for money damages for cargo damaged in a train
wreck. 33 Under two coextensive bills of lading, the goods were transported
from Australia to Huntsville, Alabama: first by ship from Australia to
Savannah, Georgia, and then by rail to Huntsville, Alabama. 34 The question
was whether the suit to recover for cargo damaged on the land leg of the trip
fell within the Court’s admiralty jurisdiction. 35 The Court answered this in the
affirmative because both bills of lading were maritime contracts. 36 This was
30 Id.
31 In re Doiron, 869 F.3d at 345–47.
32 See 543 U.S. at 22–27.
33 See id. at 18.
34 See id. at 18–21.
35 See id. at 22–24.
36 See id. at 24.
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so, the Court reasoned, because the “primary objective” of these bills was “to
accomplish the transportation of goods by sea from Australia to the eastern
coast of the United States.” 37
In considering whether the bills of lading were maritime contracts, the
Court broadly defined what characterized a contract as maritime. The Court
observed that:
[W]e cannot look to whether a ship or other vessel was involved in
the dispute, as we would in a putative maritime tort case. . . . Nor
can we simply look to the place of the contract’s formation or
performance. Instead, the answer “depends upon . . . the nature
and character of the contract,” and the true criterion is whether it
has “reference to maritime service or maritime transactions.” 38
The Court also emphasized that “the fundamental interest giving rise to
maritime jurisdiction is the protection of maritime commerce.” 39 “The
conceptual approach,” the Court explained, “vindicates that interest by
focusing our inquiry on whether the principal objective of a contract is
maritime commerce.” 40 The Kirby opinion clarified that we should use contract
rather than tort principles in determining whether a contract being sued upon
is maritime. 41
37 Id.
38 Id. (second alteration in original) (quoting N. Pac. S.S. Co. v. Hall Bros. Marine Ry.
& Shipbuilding Co., 249 U.S. 119, 125 (1919)); see also Exxon Corp. v. Cent. Gulf Lines, Inc.,
500 U.S. 603, 611 (1991) (“[T]he trend in modern admiralty case law . . . is to focus the
jurisdictional inquiry upon whether the nature of the transaction was maritime.”).
39 Kirby, 543 U.S. at 25 (emphasis removed) (internal quotation marks and citations
omitted).
40 Id.
41 Id. at 24. The Court explained that “[g]eography . . . is useful in a conceptual
inquiry only in a limited sense: If a bill’s sea components are insubstantial, then the bill is
not a maritime contract.” Id. at 27.
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The Court in Kirby rejected the mixed-contract theory applied in some
circuits and which was one of the underpinnings of the Davis & Sons panel’s
rationale in formulating its six-prong test. Davis & Sons explained that:
A contract may either contain both maritime and non-maritime
obligations or, as in the Gulf-Davis blanket agreement,
contemplate future detailed contracts having different
characteristics. If separable maritime obligations are imposed by
the supplementary contracts, or work orders, these are “maritime
obligations [that] can be separately enforced [in admiralty]
without prejudice to the rest,” hence subject to maritime law. 42
The Kirby court, after disapproving mixed-contract decisions from the
Second, Fifth, and Federal Circuit Courts of Appeal, 43 added the following:
Furthermore, to the extent that these lower court decisions fashion
a rule for identifying maritime contracts that depends solely on
geography, they are inconsistent with the conceptual approach our
precedent requires. Conceptually, so long as a bill of lading
requires substantial carriage of goods by sea, its purpose is to
effectuate maritime commerce—and thus it is a maritime contract.
Its character as a maritime contract is not defeated simply because
it also provides for some land carriage. 44
Our cases have long held that the drilling and production of oil and gas
on navigable waters from a vessel is commercial maritime activity. For
example, in Theriot v. Bay Drilling Corp., we considered a contract for
supplying a submersible drilling barge and concluded that the contract was
clearly maritime, noting that “[o]il and gas drilling on navigable waters aboard
a vessel is recognized to be maritime commerce.” 45 We recently affirmed this
understanding of commercial maritime activity in In re Deepwater Horizon,
42 See Davis & Sons, 919 F.2d at 315–16 (footnote omitted).
43 See, e.g., Kuehne & Nagel (AG & Co.) v. Geosource, Inc., 874 F.2d 283, 290 (5th Cir.
1989).
44 Kirby, 543 U.S. at 27 (emphasis added) (internal citation omitted).
45 783 F.2d 527, 538–39 (5th Cir. 1986).
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where we concluded that maritime law applied in reference to the oil spill that
“occurred while the vessel[, Deepwater Horizon,] was engaged in the maritime
activity of conducting offshore drilling operations.” 46
III. CONCLUSION
Based on the principles laid out in Kirby, we adopt the following two-
pronged test to determine whether a contract in this context is maritime: First,
is the contract one to provide services to facilitate the drilling or production of
oil and gas on navigable waters? The answer to this inquiry will avoid the
unnecessary question from Davis & Sons as to whether the particular service
is inherently maritime. Second, if the answer to the above question is “yes,”
does the contract provide or do the parties expect that a vessel will play a
substantial role in the completion of the contract? 47 If so, the contract is
46 745 F.3d 157, 166 (5th Cir. 2014); see also Boudreaux v. Am. Workover, Inc., 664
F.2d 463, 466 (5th Cir. Unit A Dec. 1981) (noting that vessel-related oil and gas drilling and
production “is a major industry with peculiar maritime-related problems,” and, further, that
because it is “an industry that provides approximately 40,000 jobs, and untold millions of
dollars in revenues and that takes place primarily upon the navigable waters of the United
States,” it “bears ‘a significant relationship to . . . commerce on navigable waters’”) (alteration
in original) (footnote and internal citation omitted); Pippen v. Shell Oil Co., 661 F.2d 378, 384
(5th Cir. Unit A Nov. 1981) (“[O]ffshore drilling the discovery, recovery, and sale of oil and
natural gas from the sea bottom is maritime commerce . . . .”); Corbitt, 654 F.2d at 332
(finding that a contract requiring the furnishing of a casing crew to a submersible drilling
barge was a maritime contract); Transcon. Gas Pipe Line Corp. v. Mobile Drilling Barge, 424
F.2d 684, 688–91 (5th Cir. 1970) (finding that a drilling and re-work contract requiring the
operation and “survey” of a submersible drilling barge was maritime in nature).
47 When work is performed in part on a vessel and in part on a platform or on land,
we should consider not only time spent on the vessel but also the relative importance and
value of the vessel-based work to completing the contract. In Chandris, Inc. v. Latsis, in
formulating the test for whether a worker’s connection to a vessel was substantial enough to
qualify him as a seaman under the Jones Act, 46 U.S.C. § 30104, the Supreme Court noted:
[S]ubstantiality in this context is determined by reference to the period covered
by the Jones Act plaintiff’s maritime employment, rather than by some
absolute measure. Generally, the Fifth Circuit seems to have identified an
appropriate rule of thumb for the ordinary case: A worker who spends less
than about 30 percent of his time in the service of a vessel in navigation should
not qualify as a seaman under the Jones Act. This figure of course serves as
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maritime in nature. 48 We find strong support in Kirby for this test, particularly
in the following sentence: “Conceptually, so long as a bill of lading requires
substantial carriage of goods by sea, its purpose is to effectuate maritime
commerce—and thus it is a maritime contract.” 49 Also, in Kirby, the parties
obviously expected a vessel to play a major role in transporting the cargo from
Australia to Alabama. 50
This test places the focus on the contract and the expectations of the
parties. This is the proper approach in a contract case and assists the parties
in evaluating their risks, particularly their liability under indemnification
clauses in the contract. 51 This test also removes from the calculus those prongs
of the Davis & Sons test that are irrelevant, such as whether the service work
no more than a guideline established by years of experience, and departure
from it will certainly be justified in appropriate cases.
515 U.S. 347, 371 (1995). The district courts may develop a similar rule of thumb in
evaluating substantiality in this context. However, we leave this for further development
below. The calculus would not include transportation to and from the job site.
48 See Robertson, supra note 20, at 547–48.
49 See Kirby, 543 U.S. at 27. Six other circuits have applied Kirby to determine
whether a contract is a maritime one in various circumstances; though none of those decisions
addressed a factual situation similar to that in this case, the approaches in those decision are
not inconsistent with this test. See Fireman’s Fund Ins. Co. v. Great Am. Ins. Co., 822 F.3d
620, 631–36 (2d Cir. 2016) (analyzing whether an insurance contract was maritime); N.H.
Ins. Co. v. Home Sav. & Loan Co., 581 F.3d 420, 424–27 (6th Cir. 2009) (same); Sentry Select
Ins. Co. v. Royal Ins. Co., 481 F.3d 1208, 1218–20 (9th Cir. 2007) (same); Flame S.A. v. Freight
Bulk Pte. Ltd., 762 F.3d 352, 361–63 (4th Cir. 2014) (analyzing whether forward freight
agreements were maritime contracts); Odyssey Marine Expl., Inc. v. Unidentified
Shipwrecked Vessel, 636 F.3d 1338, 1340–41 (11th Cir. 2011) (analyzing whether a contract
to conduct research pertaining to a shipwrecked vessel was maritime); Puerto Rico Ports
Auth. v. Umpierre-Solares, 456 F.3d 220, 224–26 (1st Cir. 2006) (analyzing whether a
contract to remove a sunken ship from navigable waters was maritime); see also ROBERT
FORCE & MARTIN J. NORRIS, THE LAW OF MARITIME PERSONAL INJURIES § 1:22 (5th ed. 2017)
(discussing Kirby’s approach to analyzing maritime contracts).
50 See Kirby, 543 U.S. at 19.
51 We applied a similar analysis in Grand Isle Shipyard, Inc. v. Seacor Marine, LLC,
where we held that the focus of the contract, rather than the situs of the injury, was the
relevant consideration for the purposes of evaluating the applicability of an indemnity
agreement. See 589 F.3d at 786–89; see also FORCE & NORRIS, supra note 49, § 13:9
(discussing cases applying the rule emanating from Grand Isle Shipyard).
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itself is inherently maritime and whether the injury occurred following a
maritime tort. Courts need not determine whether this service work has a
more or less salty flavor than other service work when neither type is
inherently salty.
This does not mean, however, that some of the Davis & Sons factors are
never relevant. The scope of the contract may be unclear; the extent to which
the parties expect vessels to be involved in the work may also be unclear. In
resolving these issues, courts may permit the parties to produce evidence of
the work actually performed and the extent of vessel involvement in the job.
It is also conceivable, for example, that the seamen status of a crew—which is
implicated in two of the Davis & Sons factors—could be relevant to whether
the vessel involvement was a substantial part of the overall contract. If the
contract provided only for work to be done by permanent crewmembers aboard
a vessel, the substantial vessel involvement issue would ordinarily be
answered. If part of the contract work involves work by crewmembers aboard
a vessel and part does not, the work by seamen aboard a vessel would be part
of the factual mix that the district court could consider in resolving whether
the overall contract involved substantial involvement of a vessel. 52
Applying this new test to this case, the oral work order called for STS to
perform downhole work on a gas well that had access only from a platform.
After the STS crew began work down hole, the crew encountered an unexpected
problem that required a vessel and a crane to lift equipment needed to resolve
this problem. The use of the vessel to lift the equipment was an insubstantial
part of the job and not work the parties expected to be performed. Therefore,
52 We deal today only with determining the maritime or nonmaritime nature of
contracts involving the exploration, drilling, and production of oil and gas. If an activity in a
non-oil and gas sector involves maritime commerce and work from a vessel, we would expect
that this test would be helpful in determining whether a contract is maritime.
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the contract is nonmaritime and controlled by Louisiana law. The LOIA bars
indemnity. Accordingly, we reverse the summary judgment in favor of LDI
and grant summary judgment in favor of STS, render judgment in favor of STS,
and dismiss LDI’s third-party complaint against STS.
REVERSED AND RENDERED.
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