Court Opinion

ID: 21648
Source: CourtListenerOpinion
Date Created: 2010-04-25 07:47:36+00
Date Added: 2024-06-11T12:43:13.328524
License: Public Domain

UNITED STATES COURT OF APPEALS
                                   For the Fifth Circuit
                       __________________________________________

                                      No. 99-41437
                                      G-99-CV-417
                                    Summary Calender
                       _________________________________________

   DIAMOND OFFSHORE COMPANY; DIAMOND OFFSHORE U.S.A. INC; DIAMOND
      OFFSHORE DRILLING, INC; DIAMOND OFFSHORE DRILLING SERVICES,,

                                    Plaintiffs - Counter Defendants - Appellants - Cross-Appellees,

                                                 v.

                                     A&B BUILDERS, INC,

                                       Defendant - Counter Claimant - Appellee - Cross-Appellant.

                       __________________________________________

                         Appeals from the United States District Court
                               for the Southern District of Texas
                       __________________________________________

                               August 3, 2000
Before REYNALDO G. GARZA, EMILIO M. GARZA, and DeMOSS, Circuit Judges.

PER CURIAM1:

       This is an appeal from partial summary judgment granted on behalf of Diamond. Diamond

filed a declaratory judgment action in the Southern District of Texas seeking, in relevant part, a

determination of its rights to indemnification under a contract with A&B in the ongoing,

underlying state suit in which Lee E. McMillon, an employee of A&B, has sued Diamond, the

owner of the ship on which McMillon was allegedly injured. For the reasons described below, we

       1
        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 R. 47.5, the court has determined that this opinion should not be
published and is not precedent except under the limited circumstances set forth in 5TH CIR.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.
remand to the district court for a determination of whether McMillon directly qualified for

coverage under Section 905(b) of the Longshore and Harbor Workers’ Compensation Act

(LHWCA), 33 U.S.C. § 905(b).

       In this case, the district court granted Diamond’s motion for partial summary judgment,

determining, in relevant part, that the indemnity provision was valid and that A&B had a duty to

indemnify Diamond in the McMillon suit.2 A&B argued that LHWCA § 905(b) rendered the

indemnity clause void.3 The district court determined that the indemnity clause was saved by

LHWCA § 905(c), which carves out an exception for reciprocal indemnity agreements incurred as

the result of operations on the Outer Continental Shelf (OCS). Section 905(c) provides, in

relevant part:

       Nothing contained in subsection (b) of this section shall preclude the enforcement
       according to its terms of any reciprocal indemnity provision whereby the employer
       of a person entitled to received benefits under this chapter by virtue of section
       1333 of Title 43 and the vessel agree to indemnify the other for the cost of defense
       and loss or liability for damages arising out of or resulting from death or bodily
       injury to their employees. (emphasis added). 33 U.S.C. § 905(c)

For the purposes of this remand, the relationship between Section 1333 of the Outer Continental

Shelf Lands Act (OCSLA), and LHWCA § 905(b) and § 905(c) can be described thusly: if

       2
          We recognize that A&B also appeals from the district court’s finding that the additional
insured provision of the contract created a separate obligation; while Diamond cross-appeals from
the district court’s decision to not consider awarding damages to Diamond. However, it is not
necessary to address these issues for the limited purposes of this remand.
       3
           Section 905(b) provides that:

In the event of injury to a person covered under this chapter caused by the negligence of a vessel,
then such person . . . may bring an action against such vessel as a third party . . . and the employer
shall not be liable to the vessel for such damages directly or indirectly, and any agreements or
warranties to the contrary shall be void.

                                                  2
McMillon has a cause of action under § 905(b) “by virtue of” the application of § 1333(b), then §

905(c) applies to provide an exception to the bar against indemnity in § 905(b).

       On appeal, A&B argues that Section 905(c) does not apply to save the indemnity clause

because that exception is only available to workers who qualify solely by virtue of OCSLA. In

other words, A&B argues that McMillon’s direct qualification for benefits under 905(b) precludes

operation of OCLSA § 1333(b).

       The district court determined that McMillon qualified for LHWCA benefits under OCLSA

§ 1333, but never determined whether McMillon qualified directly under LHWCA § 905(b). This

leaves two possibilities: (a) McMillon fails to qualify for the LHWCA directly, but qualifies via the

OCSLA, in which case Section 905(c) applies; or (b) McMillon qualifies under both OCLSA and

the LHWCA. The district court saw no need to determine which of the two possibilities applied

as it presumed “there is no reason to suppose that § 905(c)’s exception is available only to those

workers who qualify solely by virtue of the OCSLA.” Whether this is so is an issue of first

impression for this court, which would only need to be addressed if it were first determined that

McMillon qualified for LHWCA benefits under both LHWCA § 905(b) and OCLSA § 1333. We

remand for such a determination of McMillon’s status under both sections. As is our duty, we

refrain from presently and prematurely addressing this issue of first impression until the factual

controversy is determined to require such analysis.

REMANDED with instructions.

                                                  3