effect of the Direct Action Statute is to mirror in the insurer the liability of the insured under whatever liability law is applicable
How later courts described this case
- effect of the Direct Action Statute is to mirror in the insurer the liability of the insured under whatever liability law is applicable
Written by the judges who cited it.
The opinion
THORNBERRY, Circuit Judge,
specially concurring:
I have had reservations all along about our holding in Olympic Towing Corp. v. Nebel Towing Co., 419 F.2d 230 (5th Cir.1969), ce rt. denied, 397 U.S. 989 , 90 S.Ct. 1120 , 25 L.Ed.2d 396 (1970). See id. at 238 (Thornberry, J., voting to grant petition for rehearing en banc). There we held that a shipowner’s limitation defense was personal and consequently was not available to the shipowner’s insurer sued under the Louisiana direct action statute. In this case, the insurer inserted a provision in the policy that limited its liability under the policy to the amount of the shipowner’s liability after limitation. In effect, the insurer sought to do indirectly what Nebel Towing prohibited it from doing directly. Unlike the majority, I have no doubt that Nebel Towing precluded an insurer from taking advantage of the shipowner’s limitation defense merely by inserting a clause in the insurance policy. See Crown Zellerbach Corp. v. Ingram Industries, 745 F.2d 995 , 998-99 (5th Cir.1984) (Thornberry, J., specially concurring). The district court was correct in concluding, on the force of Nebel Towing, that London Steam-Ship was liable beyond Ingram’s limitation amount.
Today, the court en banc overrules Nebel Towing. Although I find Judge Tate’s dissent persuasive, I join the majority opinion only to the extent that it overrules Nebel Towing on the ground that limitation is not a personal defense under Louisiana law.