Huntsman International LLC v. Praxair, Inc.
201 So. 3d 899
La. Ct. App.2016Background
- Huntsman International owns the MDI plant in Geismar; Rubicon operates the plant as a joint venture and Huntsman directs its work and owns the product. Praxair supplies hydrogen and carbon monoxide under four gas-supply agreements originally between Praxair’s predecessors and Rubicon or its predecessors.
- Huntsman (with Rubicon) sued Praxair for breach of contract, detrimental reliance, and unjust enrichment alleging Praxair failed to deliver required gases. Praxair raised exceptions of no right of action (as to Huntsman’s contract claim) and no cause of action (as to detrimental reliance and unjust enrichment).
- The trial court granted Praxair’s exceptions and dismissed Huntsman’s claims with prejudice; Huntsman appealed. The appellate court reviews exceptions of no right of action and no cause of action de novo.
- Huntsman asserted three independent bases for standing to sue on the contracts: successor/assignee to RCI for the 1970 and 1981 agreements, principal of an agent (Rubicon or predecessors) for all agreements, and third-party beneficiary. Huntsman submitted the 1999 transfer agreement and affidavits; Praxair submitted the contracts and affidavits asserting subjective belief that Huntsman was not a party or principal.
- The appellate court accepted pleaded facts as true (absent contrary evidence) for the no-right/no-cause procedural posture and analyzed (1) third-party beneficiary status, (2) successor/assignee status, (3) agency/principal relationship, and (4) sufficiency of detrimental reliance and unjust enrichment allegations.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Huntsman has a right of action for breach of contract (signatory status) | Huntsman: can enforce as successor/assignee to RCI (1970/1981) | Praxair: Huntsman is not a signatory; Rubicon (not Huntsman) is successor | Held: Huntsman pleaded successor/assignee facts for 1970/1981 and Praxair offered no contrary evidence — right of action exists as to those agreements |
| Whether Huntsman can enforce contracts as principal of a signatory agent (agency) | Huntsman: Rubicon and predecessors acted as Huntsman’s agent entering the contracts | Praxair: denies agency; its affidavits state belief Rubicon acted for itself | Held: Huntsman adequately pleaded agency; Praxair’s affidavits do not refute; Huntsman may sue as principal for all agreements |
| Whether Huntsman is a third-party beneficiary (stipulation pour autrui) | Huntsman: contracts benefitted Huntsman directly | Praxair: no explicit stipulation for third-party benefit exists in contracts | Held: No — contracts do not manifest clear intent to benefit a third party; third-party beneficiary claim fails |
| Whether Huntsman pleaded viable alternative tort/unjust enrichment claims (no cause of action) | Huntsman: alleges additional promises, reliance, and Praxair’s enrichment from not performing/maintaining | Praxair: argues these are merely repackaged contract claims without separate remedy | Held: Huntsman’s petition states sufficient facts for detrimental reliance and unjust enrichment; exception of no cause of action improperly granted |
Key Cases Cited
- Board of Directors of Louisiana Recovery Dist. v. All Taxpayers, Property Owners, and Citizens of State of La, 529 So.2d 384 (La. 1988) (pleaded averments taken as true on exception of no right of action absent contrary evidence)
- Joseph v. Hospital Service Dist. No. 2 of Parish of St. Mary, 939 So.2d 1206 (La. 2006) (elements and strict requirements for stipulation pour autrui/third-party beneficiary)
- Eagle Pipe & Supply Inc. v. Amerada Hess Corp., 79 So.3d 246 (La. 2011) (exception of no right of action reviewed de novo; legal question)
- Woodlawn Park Ltd. P’ship v. Doster Constr. Co., 623 So.2d 645 (La. 1993) (undisclosed principal may enforce contracts when identity revealed)
- Suire v. Lafayette City-Parish Consol. Gov’t, 907 So.2d 37 (La. 2005) (elements and proof standard for detrimental reliance)
- Hospitality Consultants, LLC v. Angeron, 41 So.3d 1236 (La. App. 4 Cir. 2010) (exceptor bears burden to prove no right of action)