Court Opinion

ID: 6330403
Source: CourtListenerOpinion
Date Created: 2022-04-13 00:01:20.500705+00
Date Added: 2024-06-11T09:23:00.557613
License: Public Domain

Case: 21-30431    Document: 00516268601        Page: 1    Date Filed: 04/05/2022

          United States Court of Appeals
               for the Fifth Circuit                         United States Court of Appeals
                                                                      Fifth Circuit

                                                                    FILED
                                                                 April 5, 2022
                                No. 21-30431                    Lyle W. Cayce
                                                                     Clerk

   Devin Barrios

                                                                        Plaintiff,

                                    versus

   River Ventures, L.L.C.,

                                                       Defendant—Appellant,

   XL Specialty Insurance Company; Certain
   Underwriters at Lloyd’s London, Subscribing to Policy
   Number 10145-2015,

                                             Intervenor Plaintiffs—Appellants,

                                    versus

   Travelers Property Casualty Company of America,

                                              Intervenor Defendant—Appellee.

                 Appeal from the United States District Court
                    for the Eastern District of Louisiana
                        USDC Case No. 2:17-CV-585

   Before Barksdale, Stewart, and Dennis, Circuit Judges.
Case: 21-30431      Document: 00516268601          Page: 2   Date Filed: 04/05/2022

                                    No. 21-30431

   Per Curiam:*
          This appeal concerns a maritime insurance coverage dispute. River
   Ventures, L.L.C. (“River Ventures”) and its insurers, XL Specialty
   Insurance Company (“XL”) and Certain Underwriters at Lloyd’s London
   (“Lloyd’s”) (collectively, “River Ventures/XL”), assert that River
   Ventures is owed coverage as an additional insured under two policies issued
   by Travelers Property Casualty Company of America (“Travelers”) to
   Centaur, L.L.C. (“Centaur”) for a personal injury claim brought by Devin
   Barrios, a Centaur employee, against River Ventures. The district court
   granted summary judgment for Travelers, ruling that a Crew/Employee
   Exclusion precluded coverage. We affirm.
                                         I.
          United Bulk Terminals Davant, L.L.C. (“UBT”) hired Centaur, a
   marine and industrial construction company, to build a concrete containment
   wall around the edge of the dock at its facility on the east bank of the
   Mississippi River in Plaquemines Parish, Louisiana (the “dock project”).
   Previously, UBT had hired River Ventures, which owns and operates crew
   boats, to provide vessel services at the facility. During the dock project,
   Centaur’s employees relied on River Ventures for crew boat services. To
   govern the dock project, UBT and Centaur entered into a Master Service
   Contract (“MSC”). River Ventures did not contract directly with Centaur,
   nor was it a signatory to the MSC; rather, River Ventures had a separate
   contract with UBT to provide crew boat services at its facility to a variety of
   workers and contractors.
          Pursuant to section 5 of the MSC, Centaur purchased multiple
   insurance policies from Travelers, including a Protection and Indemnity

          *
            Pursuant to 5th Circuit Rule 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 Circuit Rule 47.5.4.

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Case: 21-30431      Document: 00516268601            Page: 3    Date Filed: 04/05/2022

                                      No. 21-30431

   (“P&I”) Policy and an excess/umbrella Bumbershoot Policy. Section 5 of
   the MSC also required Centaur to add members of the “UBT Group” as
   “additional insureds” on the policies, “but only to the extent of the liabilities
   assumed by [Centaur] in this Agreement.” The MSC defined “UBT
   Group” as, inter alia, “UBT and UBT’s other contractors . . . and the
   insurers of each of the foregoing.” River Ventures is a contractor of UBT
   and thus part of the “UBT Group.” In section 6 of the MSC, Centaur agreed
   to indemnify members of the UBT Group for all claims brought by any person
   for personal or bodily injury of a member of the Contractor group (defined as
   Centaur and its subcontractors) regardless of cause or fault—even if the sole
   cause was the fault of the UBT Group.
          The P&I Policy covered, inter alia, “[l]iability for loss of life of, or
   personal injury to, or illness of, any person,” as well as related “[l]iability for
   hospital, medical, or other expenses,” subject to exclusions. The key
   provision in this case is the P&I Policy’s Crew/Employee Exclusion (“the
   Exclusion”) which reads:
          Notwithstanding anything herein contained to the contrary, it
          is mutually understood and agreed that this Policy does not
          cover claims in respect to loss of life, bodily injury, personal
          injury or illness of any crew, seaman or other employee of the
          Assured regardless of whether they be employees of the
          Assured or any Additional Assured named in the Policy or
          endorsed thereto.
   The P&I Policy states that Centaur is “the Assured,” but nowhere does the
   Policy explicitly define “Additional Assured.” In accord with the MSC, the
   UBT Group—which included River Ventures and its insurers—was added
   to the P&I Policy as an “additional insured.”
          The Bumbershoot Policy provides excess liability coverage. The
   Bumbershoot Policy names Centaur as the Insured, but also has an

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                                        No. 21-30431

   “Additional Insureds” provision which states that excess coverage shall be
   provided “[i]n the event of Additional Insureds being added to any Policy
   listed in the Schedule of Underlying Insurances,” which includes the P&I
   Policy, subject to certain conditions, including that coverage for Additional
   Insureds “shall apply only in excess of similar coverage provided for” in an
   underlying policy.
           Devin Barrios, a Centaur employee working on the dock project, was
   seriously injured while moving equipment from the River Ventures vessel
   M/V TROOPER onto a work barge. While Barrios was disembarking the
   TROOPER, the vessel separated from the work barge, causing Barrios to fall
   into the river and a portable generator to fall into the water and strike his
   head. Barrios filed a maritime personal injury suit against River Ventures and
   Centaur.     River Ventures filed a cross-claim against Centaur, seeking
   indemnity and insurance coverage pursuant to the MSC.1 After a bench trial,
   River Ventures was found 100% liable for Barrios’s injury, and Barrios was
   awarded $3.3 million in damages.
           River Ventures compromised and satisfied the judgment, and filed a
   third-party complaint against Travelers seeking coverage under Travelers’
   P&I and Bumbershoot policies issued to Centaur. XL/Lloyd’s filed a
   complaint-in-intervention, seeking reimbursement of defense and indemnity
   payments. The parties filed cross-motions for summary judgment, and the
   district court granted summary judgment for Travelers and dismissed River

           1
             The district court initially granted summary judgment for Centaur on the cross-
   claim, ruling that the MSC was a non-maritime contract and that the relevant portions of
   the MSC were voided by the Louisiana Construction Anti-Indemnity Statute, La. R.S.
   9:2780.1. River Ventures appealed, and a prior panel of this court reversed and remanded,
   holding that the MSC was a maritime contract governed by federal maritime law. Barrios
   v. Centaur, L.L.C., 942 F.3d 670 (5th Cir. 2019).

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                                          No. 21-30431

   Ventures/XL’s coverage claims with prejudice.2 The district court ruled that
   the P&I Policy’s Crew/Employee Exclusion was unambiguous and
   precluded coverage for injury to Barrios, an employee of Centaur, because
   the Exclusion applied to the injuries of “any crew, seaman or other employee
   of the Assured” and the Policy defined “the Assured” as “Centaur.” The
   district court also ruled that the Bumbershoot Policy did not provide
   coverage because it was an excess policy and no underlying coverage existed.
   River Ventures/XL appealed.
                                               II.
           “This court reviews de novo a district court’s grant of summary
   judgment, applying the same standard as the district court.” Austin v. Kroger
   Tex., L.P., 864 F.3d 326, 328 (5th Cir. 2017) (citing Ford Motor Co. v. Tex.
   Dep’t of Transp., 264 F.3d 493, 498 (5th Cir. 2001)). Summary judgment is
   appropriate “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.”
   Fed. R. Civ. P. 56(a).
           Maritime contracts are governed by federal maritime law. Theriot v.
   Bay Drilling Corp., 783 F.2d 527, 538 (5th Cir. 1986). However, “‘in the
   absence of a specific and controlling federal rule,’ the interpretation of
   marine insurance policies is ‘to be determined by reference to appropriate
   state law.’” Gabarick v. Laurin Mar. (Am.), Inc., 650 F.3d 545, 552 (5th Cir.

           2
             River Ventures also filed a breach of contract cross-claim against Centaur, arguing
   that, if the Travelers’ policies did not provide coverage, then Centaur breached its
   obligations under the MSC to procure insurance. The district court denied River
   Ventures’ and Centaur’s cross-motions for summary judgment on the breach of contract
   claim, finding that there were genuine disputes of material fact that precluded summary
   judgment. Pending resolution of the coverage claim that is the subject of this appeal, the
   district court stayed and administratively closed the case, leaving resolution of the breach
   of contract claim for a later date.

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                                       No. 21-30431

   2011) (quoting Albany Ins. Co. v. Kieu, 927 F.2d 882, 886 (5th Cir. 1991)). In
   this case, Louisiana law applies.
          “Under Louisiana law, ‘[a]n insurance policy is a contract between
   the parties and should be construed by using the general rules of
   interpretation of contracts set forth in the Louisiana Civil Code.’” In re
   Katrina Canal Breaches Litig., 495 F.3d 191, 206 (5th Cir. 2007) (quoting
   Cadwallader v. Allstate Ins. Co., 848 So. 2d 577, 580 (La. 2003)).
   “Interpretation of a contract is the determination of the common intent of
   the parties.” La. Civ. Code art. 2045. “When the words of a contract
   are clear and explicit and lead to no absurd consequences, no further
   interpretation may be made in search of the parties’ intent.” Id. art. 2046.
   “A provision susceptible of different meanings must be interpreted with a
   meaning that renders it effective and not with one that renders it ineffective.”
   Id. art. 2049. “Each provision in a contract must be interpreted in light of
   the other provisions so that each is given the meaning suggested by the
   contract as a whole.” Id. art. 2050. “Ambiguous policy provisions are
   generally construed against the insurer and in favor of coverage,” but “only
   if the ambiguous policy provision is susceptible to two or more reasonable
   interpretations.” Cadwallader, 848 So. 2d at 580 (citing La. Civ. Code
   art. 2056). “An insurance contract, however, should not be interpreted in an
   unreasonable or strained manner under the guise of contractual
   interpretation to enlarge or to restrict its provisions beyond what is
   reasonably contemplated by unambiguous terms or achieve an absurd
   conclusion.” Id.
                                           III.
          On appeal, River Ventures/XL argues that the P&I Policy’s
   Crew/Employee Exclusion only applies when the entity seeking coverage is
   the employer of the person who was injured, and thus does not apply in this

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                                   No. 21-30431

   case because Centaur, not River Ventures, was Barrios’s employer. In the
   alternative, River Ventures/XL argues that the Exclusion is ambiguous and
   therefore should be construed against Travelers and in favor of coverage.
   Travelers argues that the Exclusion unambiguously excludes coverage for
   personal injury to any employees, regardless of whether they were employed
   by Centaur or any Additional Assured. We agree with Travelers that the
   Exclusion applies.
         The disputed language in the Exclusion is “any crew, seaman or other
   employee of the Assured regardless of whether they be employees of the
   Assured or any Additional Assured.” River Ventures/XL argues that the
   Exclusion only makes sense if the initial use of “the Assured” is understood
   to reference the insured entity seeking coverage—in this case, River
   Ventures—with the ensuing “regardless-of” phrase serving to modify “the
   Assured” to mean either Centaur or an Additional Assured, such that the
   Exclusion applies only when the entity seeking coverage is the employer of
   the injured employee.    By contrast, River Ventures/XL maintains that
   reading “the Assured” to mean “Centaur”—i.e. “any crew, seaman or
   other employee of [Centaur] regardless of whether they be employees of
   [Centaur] or any Additional Assured”—as the district court did, renders the
   ensuing phrase superfluous or redundant. River Ventures/XL argues that if
   the intent was to exclude coverage for injury to all employees, as Travelers
   argues, then it would have made more sense for the Exclusion to read
   “employee of the Assured or any Additional Assured,” or simply “employee
   of any Assured.” Instead, River Ventures/XL emphasizes the Exclusion’s
   use of “the Assured” rather than “any Assured,” and maintains that the use
   of the definite article “the” means that “the Assured” “encompasses the
   other insureds under the policy, but only to the extent they are seeking
   coverage as the employer of the injured worker[.]”

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                                     No. 21-30431

          We do not think that the words of the Exclusion reasonably support
   River Ventures/XL’s interpretation. Its citations to an insurance treatise and
   Louisiana appellate case law for support are also unavailing because those
   authorities pertain to different policy language than the language at issue
   here. See 2 Allan Windt, 3 Insurance Claims and Disputes § 11:14 (5th ed.
   2007); Sanders v. Ashland Oil, Inc., 656 So. 2d 643 (La. Ct. App. 1995);
   Petrozziello v. Thermadyne Holdings Corp., 211 So. 3d 1199 (La. Ct. App. 2017).
   Additionally, while River Ventures/XL argues that its interpretation of the
   Exclusion is in harmony with the MSC’s insurance coverage and indemnity
   provisions, our focus in this appeal is the language of the P&I Policy. The
   MSC does not control the interpretation of the policy, supplant its terms, or
   expand the scope of coverage provided.
          Nor is the Exclusion ambiguous. River Ventures/XL is correct that
   the Exclusion could have been written more efficiently, and the Exclusion’s
   use of “the Assured” is certainly awkward.          As quoted earlier, “[a]n
   insurance contract, however, should not be interpreted in an unreasonable or
   strained manner under the guise of contractual interpretation[.]”
   Cadwallader, 848 So. 2d at 580.
          We think that the Exclusion unambiguously precludes coverage for all
   employee claims, regardless of whether the entity seeking coverage is the
   employer of the injured employee. The phrase “regardless of whether they
   be employees of the Assured or any Additional Assured” broadens the scope
   of the Exclusion beyond precluding coverage only for personal injury to a
   Centaur employee or only when the entity seeking coverage is the employer
   of the person who was injured, and instead clearly shows an intent to preclude
   coverage for all employee injuries regardless of the identity of the covered
   employer. Therefore, the Exclusion applies to Barrios’s claim against River
   Ventures. Further, because there is no coverage under the P&I Policy, there

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   is no excess liability coverage under the Bumbershoot Policy. Thus, the
   district court correctly granted summary judgment to Travelers.
                                       IV.
         For the foregoing reasons, the district court’s grant of summary
   judgment to Travelers is AFFIRMED and the case is REMANDED for
   further proceedings consistent with this opinion.

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