Court Opinion

ID: 63128
Source: CourtListenerOpinion
Date Created: 2010-04-26 04:51:35+00
Date Added: 2024-06-11T17:20:13.208698
License: Public Domain

IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT  United States Court of Appeals
                                                    Fifth Circuit

                                                                            FILED
                                                                            July 7, 2008
                                     No. 07-30998
                                   Summary Calendar                   Charles R. Fulbruge III
                                                                              Clerk

KANSAS CITY SOUTHERN RAILWAY COMPANY,

                                                  Plaintiff-Appellant,
v.

PRUDENTIAL INSURANCE COMPANY OF AMERICA,
a New Jersey Corporation,

                                                  Defendant-Appellee.

                   Appeal from the United States District Court
                      for the Eastern District of Louisiana
                                No. 2:05-CV-1182

Before SMITH, BARKSDALE, and ELROD, Circuit Judges.
PER CURIAM:*

       Kansas City Southern Railway Company (“KCS”) appeals a summary
judgment in favor of Prudential Insurance Company of America, Inc. (“Pruden-
tial”). We affirm.

       *
         Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR.
R. 47.5.4.
                                  No. 07-30998

                                         I.
       A collision occurred between a train operated by KCS and a trailer owned
by Turner Industries Group, L.L.C., at a crossing in St. Charles Parish, Louisi-
ana. KCS sued numerous defendants, including Prudential.
       KCS sought to hold Prudential liable because of an agreement between
Prudential and KCS’s predecessor, Louisiana & Arkansas Railway Company
(“L&A”). The Public Crossing Agreement (“Agreement”) granted Prudential the
right to construct a road over L&A’s track. In return, Prudential agreed to “in-
demnify and hold L&A harmless from all claims, actions or demands made by
third persons.” The agreement further provided:
       It is the intention of Prudential to timely dedicate the public road
       leading to and from the said crossing, as well as the servitude of
       crossing, to the public. Accordingly, notwithstanding anything here-
       in to the contrary, in the event the roadway is so dedicated to the
       public and accepted for public maintenance, Prudential is relieved
       of any further responsibility under the terms of this Agreement.
The parties agree that the road was completed on or before the day on which
Prudential dedicated the roadway crossing to public use.
       In the dedication, Prudential sought to “assign, transfer, dedicate and con-
vey unto St. Charles Parish all of its rights, title and interest in and to the
Agreements with . . . [L&A].” The dedication required the Parish to assume “full
responsibility for the maintenance and operation of the railroad crossings and
signals and compliance with the terms of the Agreements affecting said cross-
ings.” Finally, the dedication sought to release Prudential “from any further
liability and responsibility under the terms of said Agreements.” The Parish ap-
proved the dedication pursuant to Ordinance No. 84-5-3. The district court
granted Prudential summary judgment, concluding that events subsequent to
the Agreement between it and L&A, namely the dedication, had relieved it of
liability.

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                                  No. 07-30998

                                        II.
      We review summary judgment de novo, applying the same standard as did
the district court. Robinson v. Orient Marine Co., 505 F.3d 364, 365 (5th Cir.
2007). Summary judgment should be granted if the evidence shows “that there
is no genuine issue as to any material fact and that the movant is entitled to
judgment as a matter of law.” FED. R. CIV. P. 56(c) (amended eff. Dec. 1, 2007).
      KCS urges that the court erred by improperly construing both the Agree-
ment between it and Prudential and Louisiana’s peremption statute, LA. REV.
STAT. § 9:2772 (West 2005). We find no error in the district court’s analysis.
      Under Louisiana law, the interpretation of an unambiguous contract is a
question of law. Amoco Prod. Co. v. Tex. Meridian Res. Exploration Inc., 180
F.3d 664, 668 (5th Cir. 1999). “When the words of a contract are clear and expli-
cit and lead to no absurd consequences, no further interpretation may be made
in search of the parties’ intent.” LA. CIV. CODE art. 2046 (West 2008). “[O]nly
when there is a choice of reasonable interpretations of the contract is there a ma-
terial fact issue concerning the parties’ intent that would preclude summary
judgment.” Amoco, 180 F.3d at 669.
      There is but one reasonable interpretation of this contract. Prudential
agreed to create a road across L&A’s railroad within two years of the Agree-
ment’s execution and to indemnify L&A for any liability caused by Prudential’s
negligence in the maintenance and operation of the roadway. This indemnifica-
tion was not perpetual, however: It was always Prudential’s intention to dedi-
cate the roadway to the Parish, and by the terms of the contract, L&A agreed to
said dedication. Prudential was to be relieved of “any further responsibility un-
der the terms of th[e] Agreement.”
      The terms of this contract could not be any more pellucid. Prudential is,

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                                       No. 07-30998

post-dedication, no longer liable under its terms.1
       Nor does any ambiguity arise from a consideration of the dedication be-
tween Prudential and the parish. The dedication explicitly required the parish
to “assume full responsibility for the maintenance and operation of the railroad
crossings . . . .” Thereafter, Prudential was to be “released from any further lia-
bility and responsibility under the terms of [the L&A agreement].”
       The terms of both agreements are unambiguous. The agreement expressly
provided for the eventual dedication of the roadway to the parish, at which point
Prudential’s obligations would cease. There is no dispute that the intended dedi-
cation occurred. Because the “intention to extinguish the original obligation
[was] clear and unequivocal,” LA. CIV. CODE art. 1880 (West 2008), “a new obligor
[was] substituted for a prior obligor,” LA. CIV. CODE art. 1882 (West 2008).
       Because the contract explicitly contemplates this eventual novation, Pru-
dential is no longer subject to liability under its terms. Accordingly, there is no
need to address whether, even if the contract still bound Prudential, Louisiana’s
peremption statute, LA REV. STAT. § 9:2772, would absolve it from liability. Fur-
ther, because we cabin our decision to a reading of the plain text of the Agree-
ment, we also need not address the effect the peremption statute would have on
the parties’ relationship if Prudential were still liable under the contract.
       AFFIRMED.

       1
         KCS further alleges that Prudential remains liable for negligence in the original de-
sign of the roadway, including grading, drainage, and finished surfaces. It is true that the
Agreement contemplated Prudential’s being responsible for this. Nevertheless, the Agreement
also contemplated Prudential’s dedicating the road to the parish, at which time the parish
would assume whatever responsibilities Prudential had at that time.

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