This case, which involves at least thirteen separate lawsuits among at least fourteen parties, presents once again the legal difficulties attending a personal injury to a worker involved in capturing oil and mineral resources off the coast of Louisiana. At issue are the validity of the district court’s assignments of comparative fault, the enforceability of a standard indemnity clause between a platform owner and a service contractor, and the effectiveness of other insurance clauses in the multiple layers of insurance each of the principal defendants in this case have purchased. We divide our opinion into three parts corresponding to these three primary issues. We affirm the district court’s holdings on the comparative fault and indemnity questions, with the exception of one question that we certify to the Louisiana Supreme Court. Finding that the resolution of the disputes concerning the other insurance clauses in the policies requires powerful policy choices of state law, we also certify the insurance issue to the Louisiana Supreme Court.
I
A
Forest Oil Corp. owned several oil platforms in the Gulf of Mexico, including the Vermillion group 255, located on the Outer Continental Shelf. Pursuant to a Blanket Time Charter, Forest chartered the M/V MISS DEBORAH in a non-demise
Jerry Hodgen worked as an operator for OCS. OCS assigned him for a single hitch, a seven day period, to Forest’s Vermillion 255 platform group. The Vermillion 255 group
On the morning of May 5, 1991, Hodgen, Doucet, and coworker Randy Ardoin rose on 255-B early. The schedule for the day called for Hodgen and Ardoin to travel via the MISS DEBORAH to 255-A for meter readings, but the seas were 7-9 feet. All three men knew that 255-A had no crane equipped for transfer from a boat to the platform via personnel basket, and thus that the only means of transfer was via helicopter or via swing rope from the MISS DEBORAH. Hodgen and Ardoin told Doucet that they did not feel able to make the swing rope transfer on and off 255-A in such rough seas and requested that Doucet call the helicopter that Forest had hired to assist in mining activity. Doucet responded that the helicopter was unavailable and told Hodgen and Ardoin to “give the vessel a try” because he had to report the meter readings to the home office soon. No emergency or urgency in fact attached to the meter readings, which might easily have been taken later in the day when the helicopter was available without interrupting the functioning of the oil operation. After conferring via radio with Captain Flanders, Doucet ordered the MISS DEBORAH to transport Hodgen and Ardoin to 255-A. Fearing the loss of their jobs, the two men complied. They boarded the MISS DEBORAH via personnel basket, sailed to 255-A, and successfully completed the swing rope transfer onto 255-A. After taking their readings, Ardoin and Hodgen attempted to swing back to the MISS DEBORAH. Ardoin completed the swing without incident. When Hodgen attempted to do so, however, the MISS DEBORAH rose quickly as Hod-gen landed. Hodgen’s impact on the boat caused him to suffer damage to his spinal cord, which in turn resulted in partial paralysis and an inability to control certain body functions.
Hodgen sued Forest, Doucet,
The district court found that “Doucet was negligent in sending plaintiff onto a vessel in these rough conditions, especially when a helicopter could just as easily have been used and there were no compelling circumstances present.” Hodgen v. Forest Oil Corp.,
B
Hodgen settled all claims with all parties and dismissed his suit with prejudice. This left issues regarding indemnity and insurance. Because the assignments of fault provide the baseline for the adjudication of indemnity and insurance issues, however, Forest appeals the judgment in favor of Hodgen. Forest contends that the district court erred in holding it responsible for 85% of the fault. First, citing Brown v. Link Belt Division of FMC Corp.,
C
We find neither of Forest’s arguments convincing. We refuse to reach Forest’s first argument because the district court’s judgment against Forest did not rest upon a time charterer’s duty to provide a safe means of transfer to the vessel. We also hold that the district court committed no clear error by assigning the majority of the fault to Forest.
1
Our cases addressing the existence and scope of a time charterer’s duty to third parties, persons, or entities other than the vessel subject to the charter, lack a precise consistency. As Forest notes, our cases suggest that absent special circumstances the vessel, not the time charterer, owes a duty to provide a safe means of ingress and egress for passengers. These cases represent an application of the doctrine that “the master of every vessel in navigation, regardless of how small, [is] the ‘lord of his little world.’ ” Guillory v. Ocean Drilling & Exploration Co.,
a
At least as early as 1969, this court’s cases recognized that a master’s control over matters relating to his vessel did not translate into an exclusive duty of reasonable care when common sense and economic reality suggested that a second entity also exercised control within certain portions of this same sphere of activity. See Massey v. Williams-McWilliams, Inc.,
Two years later came Brown. In Brown, the charterer
One year later, we held that the law imposed a duty upon a time charterer outside the narrow circumstances articulated in Brown. Although Helaire v. Mobil Oil Co.,
Three years later we appeared to depart from this evolving pattern. In Smith v. Southern Gulf Marine Company No. 2, Inc.,
Two cases decided the next year, however, made clear that Smith had not relieved a time charterer of all tort responsibility for its decisions regarding the chartered vessel. In the first, Graham v. Milky Way Barge, Inc.,
We further refined the concept of this hybrid tort-contract duty in the second of the 1987 cases, Kerr-McGee Corp. v. Ma-Ju Marine Services, Inc.,
Two subsequent cases applied the Kerr-McGee focus on control to accidents arising from a passenger’s transfer to and from a vessel. In Moore v. Phillips Petroleum Co.,
In Moore and Forrester “no evidence connected the cause of the accident to the timing or location of the transfer, factors traditionally within the control of the time charterer.” Instead, the cause of the accidents were a broken rope and a dangerous means of transfer; the time charters in neither case gave
Finally, two years ago, we decided Randall v. Chevron, U.S.A., Inc.,
We affirmed. After reviewing several of these cases, we concluded that “[t]he trend of our more recent decisions .. plainly favors imposing a duty of care on a time charterer who orders the vessel he had hired to put to sea in dangerous weather.” Id. at 900. We distinguished M.O.N.T. on the ground that it primarily concerned contractual indemnity and that “the concepts of active and passive negligence have fallen by the wayside with the advance of the comparative negligence doctrine.” Id. We also commented that “[t]he force of the language in Smith suggesting that the time charterer was not responsible for injuries resulting from sending the vessel into rough seas is undercut by that court’s agreement with the district court that the time charterer’s decision was ‘not unreasonable.’” Id. (quoting
b
We draw several principles from this our precedent. First, in this circuit, Randall establishes that a time charterer’s duties no longer depend on M.O.N.T. concepts of active and passive negligence. That is, a time charterer may be held liable regardless of whether the vessel owes a primary duty or a high standard of care to the injured plaintiff. Second, a time charterer owes a Graham duty, a hybrid duty arising from contract and tort, to persons with whom it has no contractual relationship, including vessel passengers, to avoid negligent actions within the sphere of activity over which it exercises at least partial control. Graham, Kerr-McGee, P & E, and Randall establish that the traditional spheres of activity in which a time charterer exercises control and thus owes a duty include choosing the vessel’s cargo, route, and general mission, as well as the specific time in which the vessel will perform its assignment. Third, Brown makes clear that the parties may vary the traditional assignment of control by contract or custom. Fourth, Kerr-McGee illustrates that unless the parties have so varied the traditional allocation of responsibility, a time charterer owes no duty beyond these spheres. Fifth, Moore and Forrester establish that a time charterer’s traditional sphere of control does not extend to providing a safe means of ingress and egress from the vessel, absent special circumstances. Sixth, Randall makes clear that the fact that a vessel may owe a duty to a third party over a certain sphere of activity does not necessarily mean that this duty is exclusive. Thus, the fact that a vessel owes a duty to a passenger to provide a safe means of ingress and egress does not mean that an accident arising from this activity cannot also be the fault of the time charterer, if the plaintiff can establish that accident resulted in part from a decision, such as the timing of the ingress or egress, within the time charterer’s control spheres.
These principles make clear that the district court committed no error in this case.
The only case arguably inconsistent with our reasoning is Smith. In Smith, one might argue, there was nothing inherently dangerous about the choice to use the boat to transport passengers from the shore to the platform; instead, the timing of the mission gave rise to the risks attending the expected passenger discomfort. Since this timing was in control of the charterer, the Smith court’s statements regarding the total absence of a duty on the part of the charterer are inconsistent with our view of the case law.
The Smith court may have spoken in unnecessarily broad terms, especially given its finding that there was nothing negligent in the choice to use the vessel on those seas. In the alternative, the Smith court may have rested on the view that the time charterer was entitled to rely on the vessel’s independent responsibility to hand out a sufficient number of garbage bags, repair the passenger bathroom, or take other steps. In other words, although the timing of the trip may have been less than ideal, the trip might still have been made safely, and the means of making trip at this particular time safe were in the control of the vessel, not the time charterer. Such a distinction treads dangerously near to the concepts of active and passive negligence relied on in M.O.N.T. and since rejected in Randall. As Randall implied, the modern approach to such situations is to impose a duty upon both parties having control over the events causing an accident and to translate previous principles of primary and secondary fault into findings on comparative negligence. We read Smith in a manner fitting with the pattern of cases decided both before and after it. See Burlington Northern R.R. v. Brotherhood of Maintenance of Way Employees,
2
Forest’s second argument is that the district court committed clear error by assigning 85% of the fault to Forest. We disagree. Although Captain Flanders, as master of the MISS DEBORAH, may have labored under an independent duty to stop the swing rope transfer in the high seas, the district court could find that Flanders’ negligence was less important than that of Doucet, who negligently refused Hodgen’s request for the helicopter and sent Hodgen on his mission to 255-A knowing that the only
II
Hodgen’s underlying action gave rise to a web of litigation in which OCS, Forest, A & A, and the insurers of each attempted to pin responsibility for paying Hodgen’s damages upon someone else. Initially, most of these suits depend on the contractual relationship between Forest and OCS, specifically the enforceability of a clause in the Master Service Agreement, requiring OCS to indemnify Forest in any suit by an OCS employee against Forest arising out of activities conducted pursuant to the Agreement. The district court held that the Louisiana Oilfield Indemnity Act, La.Rev.Stat. § 9:2780.B, made applicable via the incorporation of state law in the OCSLA, 43 U.S.C. § 1333(a)(2)(A), barred enforcement of the indemnity clause. Hodgen v. Forest Oil Corp.,
A
The Master Service Agreement between OCS and Forest is short. It contemplates that the parties will agree to future orders for the performance of services and does not specify the price or nature of this work. Under the heading “Insurance,” OCS agreed “to procure and maintain, at its sole expense ... policies of insurance in favor of Forest ... and [the] ‘Forest Group.’ ” The Agreement defined the “Forest Group” broadly to include any “contractors;” A & A asserts, and OCS does not contest, that it is a member of the Forest Group under the Agreement. The Agreement also provided, “[E]ach policy will name Forest Group as additional insured.” Under the heading “Indemnity,” OCS agreed to
indemnify ... Forest Group ... from and against any and all ... defense costs or suits ... by any [OCS] employee ... in any way, directly or indirectly, arising out of or related to the performance of [the Agreement] or the use by [the OCS] employee of ... any ... vessel or other premises[,] including ingress and egressf,] including ... the sole, concurrent, or partial negligence, ... fault or strict liability of Forest Group.
Hodgen’s suit against Forest and A & A prompted suits by both against OCS. The two entities sought to use the indemnity clauses in the Agreement to force OCS to pay for their negligence. Both suits also stated causes of action for breach of contract, alleging that OCS had breached the Agreement by failing to name the Forest Group as an additional insured on its insurance policies. Forest and A & A also sued a group of Five Underwriters providing insurance to OCS, alleging that OCS’s policy with the Five Underwriters covered the Forest Group. A & A’s excess insurer, Albany Insurance Co., sued Aetna Casualty & Indemnity Corp., OCS’s workers’ compensation carrier, for indemnity and contribution and for a
The district court first addressed whether the OCSLA’s assimilation of state law applied to the dispute between OCS and the Forest Group. It divided its analysis into two steps. Relying on the six-factor test articulated in Davis & Sons, Inc. v. Gulf Oil Corp.,
B
Forest, A & A, and their insurers appeal each of the district court’s decisions. Their primary argument is that the district court erred in applying the LOIA because the controversy did not arise on an OCSLA situs. They also argue that because the Agreement was maritime, maritime law applies of its own force. Forest, A & A, and their insurers further contend that the district court erred in not applying the exception of Marcel v. Placid Oil,
C
We divided our discussion in this phase of the case into two parts. First, we explain our reasons for holding that the OCSLA’s assimilation of state law applies to this case. Second, we deal with the arguments of Forest, A & A, and its insurers that the LOIA does not prevent the shifting of costs to OCS and its insurers.
1
In assessing the arguments of Forest, A & A, and their insurers regarding the OCSLA’s incorporation of state law, we again confront a series of arguably inconsistent eases.
The difficulty our case law has created, and the proper way to safety, are both evident in the recent opinion in Wagner v. McDermott, Inc., 899 F.Supp. 1551 (W.D.La. 1994), aff'd,
Understandably reluctant to rely solely on this line of reasoning in light of our case law, however, the Wagner district court went on to analyze the case in terms of the three-part test articulated in Union Texas Petroleum Corp. v. PLT Engineering,
The confusion inherent in our case law is evident from the Wagner district court’s heroic efforts to deal with the conflicting precedent.
As we will explain, we believe the court’s focus on the Davis & Sons factors eliminates at least one area of concern, namely, the difference between deciding whether a con
a
We first address the elements of the test governing whether the OCSLA applies. In particular, we discuss the relationship between the three-part test of Union Texas Petroleum Corp. v. PLT Engineering,
The PLT test was first announced in that ease in 1990 without relevant citation. The test consists of three factors: “(1) The controversy must arise on a situs covered by OCSLA (i.e. the subsoil, seabed, or artificial structures permanently or temporarily attached thereto). (2) Federal maritime law must not apply of its own force. (3) The state law must not be inconsistent with Federal law.”
In Domingue, however, we appeared to short-circuit this test entirely. Domingue concerned a jack-up drilling rig owner’s reliance on an indemnity clause in a master agreement in response to a suit by a well-tester who was injured aboard the rig, at the time located on the Outer Continental Shelf.
The absence of any mention of the OCS-LA, situs, and consistency with federal law led the district courts in this case and in Wagner v. McDermott, Inc.,
In arriving at this reading of Domingue, we draw significant support from the statements in our prior cases suggesting that the questions of whether a contract is maritime, step one in the test articulated by the district court in this case, and of whether federal maritime law applies of its own force, factor two in the PLT three-factor test, are one and the same thing in the context of an oilfield indemnity agreement. See Wagner,
It is not clear whether in Domingue the first and third elements were at issue. It is not clear whether Domingue applied, sub silentio, the three-part PLT test, but addressed only the question of whether maritime law applied of its own force, an inquiry identical to whether a contract is maritime or non-maritime. We decline to read into that case an odd proposition it did not state, namely, that a finding that a contract is non-maritime compels the conclusion that state law applies of its own force in the context of oil operations conducted on the Outer Continental Shelf.
The proper test for deciding whether state law provides the rule of decision in an OCSLA case remains the three-part PLT test.
b
The PLT test consists of three factors: “(1) The controversy must arise on a situs covered by OCSLA (i.e. the subsoil, seabed, or artificial structures permanently or temporarily attached thereto). (2) Federal maritime law must not apply of its own force. (3) The state law must not be inconsistent with Federal law.” Union Texas Petroleum Corp. v. PLT Engineering,
Forest, A & A, and their insurers concentrate the brunt of their attack on the district court’s finding that the situs factor was satisfied. In particular, appellants in this portion of the case argue that Hollier v. Union Texas Petroleum Corp.,
Assuming without deciding that Hollier and Smith state a rule in this circuit providing that the situs of the controversy in an OCSLA indemnity clause case is the location of the accident, we agree with the district court and find that the situs requirement is met in this case. Hodgen was in physical contact with the rope, a portion of the platform, at the time of his unfortunate landing on the MISS DEBORAH. Hollier itself established that when an injured worker is in contact with both a platform and a boat, the first factor of the PLT test is satisfied, for in that case, the worker was injured when “[o]ne day, as he was crossing from the boat to the platform, he slipped between the boat and the platform, was crushed, and then drowned.”
Forest argues that the evidence shows that Hodgen suffered his injuries not when the MISS DEBORAH first came up under his feet, but a split second later when the impact of this initial contact knocked Hodgen on all fours, and that Hodgen at this later moment had released the rope. The district court made no findings of fact on this issue, and the evidence is equivocal. Randy Ardoin testified to two or three different versions of the events of the accident, but one of these versions suggested that Hodgen maintained his hold on the rope as he was knocked on all fours. In addition, one physician testified that Hodgen’s injuries could have been caused by either the initial or the subsequent impact with the MISS DEBORAH, or by both.
Even if the evidence were pellucid that Hodgen’s injuries were caused by the spill onto all fours, and that Hodgen released the rope at this precise moment, we would still find OCSLA situs present. In Hollier, the injured worker “was crushed, then drowned.”
ii
We agree with the district court that the contract between Forest and OCS was non-maritime. In Davis & Sons, Inc. v. Gulf Oil Corp.,
1) what does the specific work order in effect at the time of injury provide? 2) what did the crew assigned under the workorder actually do? 3) was the crew assigned to work aboard a vessel in navigable waters[?] 4) to what extent did the work being done relate to the mission of that vessel? 5) what was the principal work of the injured worker? and 6) what work was the injured worker actually doing at the time of injury?
Although there was no written work order in effect at the time of Hodgen’s injury, the district court found that “all work performed for Forest by OCS’s personnel was related exclusively to Forest’s fixed platforms.” Hodgen v. Forest Oil Corp.,
Forest, A & A, and their insurers dispute this reasoning on two grounds. First, they argue that Hodgen was engaged in the process of moving from the platform to the MISS DEBORAH at the time of the accident; the argument runs that ingress and egress to the vessel is a separable maritime obligation within a non-maritime contract. Circuit precedent forecloses this argument. Hollier v. Union Texas Petroleum Corp.,
iii
We find nothing in the LOIA inconsistent with federal law. Although we have traveled this ground before, see Knapp v. Chevron USA Inc.,
2
The LOIA voids indemnity agreements purporting to provide “for defense or indemnity, or either, to the indemnitee against loss or liability for damages arising out of or resulting from death or bodily injury to persons, which is caused by or results from the sole or concurrent negligence or fault (strict liability) of the indemnitee.” La.Rev.Stat. § 9:2780.B. Additional insured and other contractual arrangements designed to circumvent this prohibition are also unenforceable. La.Rev.Stat. § 9:2780.G.
Seeking to escape the LOIA’s mandate, Forest, A & A, and their insurers argue that the exception to the LOIA recognized in Marcel v. Placid Oil Co.,
a
In Marcel, this court recognized that “[t]he LOIA is aimed at preventing the shifting of the economic burden of insurance coverage or liability onto an independent contractor.”
Appellants assert that this case falls within the Marcel exception for two reasons. First, OCS’s premiums did not vary according to the identity of the parties named as additional insureds. Second, Forest had a “working policy” allowing contractors like OCS to factor the cost of naming the Forest Group as insureds into the price they charged Forest.
We find neither argument convincing. The Marcel court stressed that the exception it recognized “does not apply if any material part of the cost of insuring the indemnitee is borne by the independent contractor procuring the insurance coverage.” Id. at 570. In this case, OCS payed all of the premiums in full. Accepting Forest’s argument that OCS could raise its price according to the amount necessary to cover its insurance costs would gut the LOIA, since all contractors will take this economically necessary step. The fact that the premiums did not vary according to the identity of the additional insured does not change the fact that these premiums were paid, and that OCS paid them.
b
In accordance with Rule XII § 3 of the Supreme Court of Louisiana, we provide the following statement identifying the “nature of the cause and circumstances out of which the question of law arises.” Meloy v. Conoco, Inc.,
Platform worker Jerry Hodgen was employed by Operators & Consulting Services, Inc. OCS entered into a Master Service Agreement with platform owner Forest Oil Corp. To assist in its operations, Forest time chartered the MTV MISS DEBORAH. Hodgen suffered injuries in the scope of his employment for OCS while assigned to work on one of Forest’s fixed platforms located on the Outer Continental Shelf. Hodgen sued Forest and the MISS DEBORAH. The district court found that Hodgen’s injuries were caused by the joint negligence of the MISS DEBORAH and Forest in its capacity as the vessel’s time charterer. The district court exonerated Forest in its capacity as platform owner of all negligence. On appeal, we affirmed the district court’s findings of fault in toto.
Forest argued below that because it was exonerated of any negligence in its capacity as platform owner, the doctrine of Meloy v. Conoco, Inc.,
The facts of Meloy did not require the court to address a situation in which an indemnitee is found faultless in one capacity but culpable in another. Although some of our case law, most recently Wagner v. McDermott, Inc.,
Ill
The remaining issues in this ease concern the dispute between Forest and the insurers of A & A regarding who must pay for Forest’s liability in its capacity as a time charterer. These matters in particular may concern the operation of “other insurance” clauses in the insurance contracts covering A & A as well as those allegedly covering Forest. The issues raised in this case turn on important policies of state law. Accordingly, we certify these matters to the Louisiana Supreme Court. We begin our discussion with a complete “statement of facts showing the nature of the cause and the circumstances out of which the question of law arises.” Meloy v. Conoco, Inc.,
A
Platform worker Jerry Hodgen was employed by Operators & Consulting Services, Inc. OCS entered into a Master Service Agreement with platform owner Forest Oil Corp. To assist in its operations, Forest time chartered the M/V MISS DEBORAH in
In accordance with its obligations under the Blanket Time Charter, A & A bought Protection and Indemnity insurance policies from Commercial Union Insurance Co. and Albany Insurance Co. The Commercial Union policy provided primary coverage and has policy limits of $500,000. It named Forest as an additional insured. It also included the following language under the heading “OTHER INSURANCE”: “Provided that where the Assured is, irrespective of this insurance, covered or protected against any loss or claim which would otherwise have been paid by the Underwriters under this Policy, there shall be no contribution or participation by the Underwriters on the basis of excess, contributing, deficiency, concurrent, or double insurance or otherwise.” Those in the insurance industry refer to this type of other insurance clause as an escape clause. The Albany policy provided coverage excess to that of the Commercial Union policy and limited Albany’s liability to $4,500,000. Section 2(a) of the Albany policy limited Albany’s responsibilities to “liability, loss, damage, or expense insured against under the” Commercial Union policy. Thus, the Albany policy incorporated the Commercial Union escape clause.
The Commercial Union policy included certain further language that may be relevant to this litigation. Under the heading “LIMIT OF LIABILITY,” the policy provided, “Liability hereunder [illegible] consequences of any one casualty or occurrence, including defense costs, shall not exceed the sum of $500,000 less any applicable deductible, regardless of how many separate injuries or claims arise out of such casualty or occurrence.”
In addition, Forest purchased certain insurance. As we will explain, we are uncertain whether Louisiana law renders irrelevant the insurance Forest purchased on its own. We describe these policies only to comply with our obligations under Rule XII in the event that the Louisiana Supreme Court decides that their terms are relevant to its disposition of this case.
Forest bought a Workers Compensation and Employers Liability Insurance policy from the Insurance Company of North America. The INA policy covered Forest for its employees’ “bodily injur[ies arising] out of and in the course of the injured employee’s employment by [Forest]” to policy limits of $1,000,000. Under the heading “Other Insurance,” the INA policy provided as follows:
We will not pay more than our share of damages and costs covered by this insurance and other or self-insurance. Subject to any limits of liability that apply, all shares will be equal until the loss is paid. If any insurance or self-insurance is exhausted, the shares of all remaining insurance and self-insurance will be equal until the loss is paid.
The parties inform us that, despite the reference to “equal shares” in the above language, this type other insurance clause is called a pro-rata clause. The phrase “pro-rata” refers to a system of assigning responsibility for satisfaction of the claim by requiring each insurer with an applicable policy to pay in accordance with the fraction generated by the division of that insurer’s policy limits with the sum of the limits of all applicable policies.
In addition, Forest purchased a broad umbrella policy providing various types of coverage from a conglomeration of various underwriters; the parties refer to this policy as the “Storebrand” policy. All agree that the Storebrand policy provided coverage excess to that provided by the INA policy to a limit of $50,000,000. The parties dispute whether the Storebrand policy also provides primary coverage to Forest in its capacity as time charterer with policy limits of $50,000,000, although, as we will explain, we find ourselves able to resolve this dispute without the aid of the Louisiana Supreme Court. Section vii, part L of the Storebrand policy specified under the heading “OTHER INSURANCE,”
If other valid and collectible insurance with any other insurer is available to the Assured covering a loss also covered by this Cover Note, other than insurance that is specifically stated to be excess of this Cover Note, the insurance afforded by this Cover Note shall be in excess of and shall not contribute with such other insurance.
The insurance industry labels this type of other insurance clause an excess clause.
Hodgen suffered injuries in the scope of his employment. These injuries were caused by the joint negligence of A & A and of Forest in its capacity as the MISS DEBORAH’S time charterer. Hodgen sued A & A and Forest and recovered $2,402,990.19 plus interest in federal district court. The district court assigned 85% of the fault to Forest in its capacity as time charterer. On appeal, we have affirmed. The district court held that at the time of the accident, Hodgen was a borrowed employee of Forest within the meaning of Doucet v. Gulf Oil Corp.,
Forest filed a third party complaint against Commercial Union and Albany seeking reimbursement for its damages and expenses under the policies issued by those two entities. Commercial Union and Albany admit that, but for the escape clauses in their policies and the existence of the INA and Storebrand policies, they would be liable to Forest. No party has joined INA or Storebrand to this litigation. The parties agree that Louisiana law governs their dispute.
B
We detail here our resolutions to questions that we decline to certify to the Louisiana Supreme Court.
We first consider an argument from Commercial Union. We have granted the limit of liability section of the Commercial Union. This language limited Commercial Union’s liability to $500,000. Commercial Union has paid this sum in full to A & A as partial reimbursement for litigation costs and the 15% share of A & A’s liability. Albany has reimbursed A & A for the remainder of these expenses. Commercial Union asks us to affirm the judgment below in its favor on the ground that it has exhausted its policy limits. Forest offers two arguments against Commercial Union’s request for an affirmance on this alternative ground. Forest’s primary contention is that because the Commercial Union policy did not define “accident or occurrence,” we must hold that Hodgen’s injuries constituted two separate accidents under Nora v. Grayline Motor Tours, Inc.,
Forest’s secondary contention is that Commercial Union’s duty to defend Forest arose simultaneously with its duty to defend A &
Second, we address Forest’s argument that parole evidence is relevant to decide whether Forest and A & A intended for any insurance bought by A & A and naming Forest as an additional insured to be primary to insurance bought by Forest on its own behalf. We do not agree. We find no ambiguity in the Blanket Time Charter, which includes an integration clause, or in the relevant insurance policies that would warrant a resort to parole evidence. See Diefenthal v. Longue Vue Management Corp.,
Third, we address Forest’s argument that the Storebrand policy provided only secondary coverage for Forest’s liability in this case. We cannot agree. Section vii of this policy consisted in part of the form “Umbrella Policy (London 1971),” Part II of which provided that the Storebrand’s policy coverage was limited to the loss in excess of the coverage provided by the INA policy. Section vii of the Storebrand policy, however, included a series of eight endorsements. Endorsement No. 1, Paragraph 14, under the heading “UNCOVERED BY UNDERLYING INSURANCE,” excluded all coverage for “any liability whatsoever not covered by the underlying insurances as set out in the attached schedule” except in the amount of loss covered by the primary policy but above the primary policy’s limits. Endorsement No. 8 provided that “it is understood and agreed that notwithstanding of Paragraph 14, UNCOVERED BY UNDERLYING INSURANCE, contained in Section (vii), Endorsement No. 1, this insurance will respond excess of a self-insured retention of U.S. $25,000 each and every loss in respect of Charterer’s Legal Liability” (emphasis in original). We are confident of the view of the Louisiana Supreme Court on this issue. The language of this last endorsement is plain. In the event that resolution of this question becomes necessary, we hold that the Storebrand Policy provided primary insurance for this loss to policy limits of $50,000,-000.
C
We provide here a brief explanation of the three insurance questions certified to the
1
Initially, the resolution of this case depends upon whether the failure of Commercial Union and Albany to join INA and Storebrand precludes the former duo from relying on the possibility of other coverage from other insurers to escape or reduce their liability. At least one ease from the Louisiana Court of Appeal suggests that an insurer who has issued a policy covering a particular loss may not invoke an other insurance clause to escape or reduce liability to the insured without joining the other insurers allegedly providing coverage in the same litigation. Wilks v. Allstate Insurance Co.,
If the Louisiana Supreme Court answers Certified Question Two affirmatively, Commercial Union and Albany will be responsible for the entirety of the defense and indemnity costs of both A & A and Forest. Because some liability has been imposed upon Commercial Union for Forest’s loss, however, a question remains as to how to apportion the $500,000 that Commercial Union owes to both Forest and A & A between the two. The limits of the two policies cover this loss entirely, and an affirmative answer to Certified Question Two would impose such an obligation on both insurers, requiring Albany to pay all losses over $500,000. Nevertheless, we have included Certified Question Two-A, in order to resolve the issue of to whom Commercial Union must pay its $500,-000 should the Supreme Court of Louisiana conclude that Wilks states the present law of Louisiana.
2
In the event that the Supreme Court of Louisiana holds that Louisiana law allows consideration of other insurance with joinder of the other insurers, a question remains as to which insurers must respond for what losses. Although we recognize that, absent reliance in subsequent litigation on the rules of privity, any ruling we issue in this case will bind only Commercial Union, a negative answer to Question Two necessitates the calculation of the liability of Commercial Union with an eye to what INA and the Storebrand group might pay.
Resolution of this dispute depends on the relationship among the INA, Storebrand, and Commercial Union policies. Given a negative answer to Certified Question Two, Albany’s excess policy would no longer be directly at issue because of the doctrine of Truehart v. Blandon,
This case is a battle of the other insurance clauses in the three policies. Our review of Louisiana cases leaves us uncertain as to how Louisiana would distribute liability among three such insurers. There are three potential conflicts in the other insurance clauses: escape versus excess, escape versus pro-rata, and excess versus pro-rata. All three are here possible, since the Commercial Union policy includes an escape clause, the INA policy a pro-rata clause, and the Storebrand policy an excess clause.
Regarding the first conflict, in Graves v. Traders & General Insurance Co.,
Regarding a conflict of escape versus prorata, we have found no Louisiana case law on point. We note, however, that federal district courts sitting in Louisiana have interpreted Louisiana law as providing that an escape clause trumps a pro-rata clause, and thus that the insurer whose policy includes the pro-rata clause must respond in full up to its limits before the insurer whose policy includes the escape clause, if the latter must respond at all. See, e.g., Efferson v. Kaiser Aluminum & Chemical Corp.,
Regarding a conflict of excess versus prorata, in Juan v. Harris,
In the event that the Louisiana Supreme Court decides that the battle of the other insurance clauses results in the imposition of some liability for Commercial Union, the issue again arises as to how Commercial Union is to apportion its $500,000 policy limit
IV
We AFFIRM in part. Pursuant to La. R.S. 13:72.1.A and Rule XII of the Supreme Court of Louisiana, we CERTIFY four questions to the Louisiana Supreme Court. CERTIFICATE FROM THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT TO THE SUPREME COURT OF LOUISIANA, PURSUANT TO RULE XII, LOUISIANA SUPREME COURT RULES, TO THE SUPREME COURT OF LOUISIANA AND THE HONORABLE JUSTICES THEREOF:
I. STYLE OF THE CASE
The style of this case in which certification is made is Jerry B. Hodgen and Bobby Sue Hodgen v. Forest Oil Corp., et al., Case No. 94-41244, United States Court of Appeal for the Fifth Circuit, on appeal from the United States District Court for the Western District of Louisiana.
II. QUESTIONS CERTIFIED TO THE SUPREME COURT OF LOUISIANA
On the facts recited, we certify the following questions of law certified to the Supreme Court of Louisiana:
Question 1: Under the doctrine of Meloy v. Conoco, Inc.,504 So.2d 833 (La.1987), does the LOIA allow a party found faultless in its capacity as platform owner but culpable in its capacity as time charterer to enforce an indemnity agreement so as to collect those costs attending its defense in its capacity as platform owner?
Question 2: Does Wilks v. Allstate Insurance Co.,195 So.2d 390 (La.Ct.App.1967), correctly state the law of Louisiana that an insurer may not escape or reduce its liability on the basis of an other insurance clause unless the insurers allegedly providing additional coverage are made parties to the litigation?
IF THE RESPONSE IS “YES,” PLEASE ANSWER QUESTION 2(a).
IF THE RESPONSE IS “NO,” PLEASE SKIP QUESTION 2(a) AND ANSWER QUESTION 3.
Question 2(a): A primary policy insures two insureds, both of which are held liable for a single accident covered by the policy. The costs of defending and indemnifying the two insureds exceeds $500,000, the limit of the insurer’s total liability to both insureds. How does Louisiana law require the insurer to apportion the payment of the $500,000 among the two insureds?
PLEASE ANSWER NO FURTHER QUESTIONS.
Question 3: Three insurance policies all provide primary coverage to a first insured suffering a loss. Each policy includes an “other insurance” clause of a different type. The policy including an escape clause has limits of $500,000. The policy including an excess clause has limits of $50,000,000. The policy including a prorata clause has limits of $1,000,000. The carrier issuing the policy with $500,000 limits and an escape clause owes an obligation to a second insured arising from the same accident and the same policy. The costs of defending and indemnifying both the first and second insureds exceeds $500,000. The terms of this policy limit the carrier’s obligation to a single $500,000 payment to both insureds. How does Louisiana law apportion responsibility among the three carriers for the first insured’s loss? See, e.g., Juan v. Harris,279 So.2d 187 (La.1973); Graves v. Traders & General Insurance Co., [252 La. 709 ],214 So.2d 116 (La.1968); Penton v. Hotho,601 So.2d 762 (La.Ct.App.1992); Sledge v. Louisiana Department of Transportation and Development,492 So.2d 139 (La.Ct.App.), writ denied,494 So.2d 1176 (1986); Efferson v. Kaiser Aluminum & Chemical Corp.,816 F.Supp. 1103 , 1119-21 (E.D.La.1993); Layton v. Land & Marine Applicators, Inc.,522 F.Supp. 679 (E.D.La.1981); Lodrigue v. Montegut Auto Marine Services,1978 A.M.C. 2272 (E.D.La.1977); Viger v. Geophysical Services, Inc.,338 F.Supp. 808 , 812 (W.D.La.1972), opinion adopted by476 F.2d 1288 (5th Cir.1973).
This court also certifies to the Louisiana Supreme Court that its answer to these questions will be determinative in this case, resolving all issues among the parties. We note that an affirmative answer to Certified
Notes
. In a “non-demise" charter, the owner of the ship remains in control of the vessel and provides the crew. Forrester v. Ocean Marine Indemnity Co.,
. Following the court below, we treat Forest and Doucet as a single party.
. The district court also held that Hodgen was the borrowed employee of Forest at the time of the accident See Doucet v. Gulf Oil Corp.,
. The charter in Brown was a bareboat charter. Because the charterer hired a third company to provide the crew, however, the extent of the charterer’s control over the vessel’s operations was similar to that provided for in a standard non-demise time charter.
. We applied the Kerr-McGee focus on control in In re P & E Boat Rentals, Inc.,
. Were we to conclude that our cases are in hopeless and unprincipled conflict, we would follow Randall as the case with the most analogous facts and affirm the district court’s imposition of a duty. As the subsequent discussion illustrates, we take a more sanguine view.
. The district court also relied in part upon Doucet's refusal to call for the helicopter, finding that this decision was made by Forest in its capacity as time charterer of the MISS DEBORAH. Perhaps because of its separate insurance policies for time charterer and platform owner roles, and because the platform owner insurance attorney litigated the case up to trial on its behalf, Forest affirmatively argued below that any failure to use the helicopter was a decision made in its capacity as a time charterer. Because no party has appealed the district court’s reliance on this factor, we make no comment on it.
. We have on previous occasion expressed our frustration with the inconsistency of our case law in this general area. See, e.g., Campbell v. Sonat Offshore Drilling Inc.,
. A factual twist in Domingue made the case somewhat complex: the injured worker was not employed by the company against whom the rig owner sought indemnity, and his work order did not arise from the master contract containing the indemnity clause.
. In adopting this interpretation, we of necessity construe the reference to "federal law” in the opening sentence of Part II of Rodrigue, see
. Forest also sued Aetna Casualty & Surety Co., one of OCS's insurers, alleging that OCS had in fact named Forest as an additional insured in OCS's policy with Aetna. The district court held that Forest was not an additional insured on the Aetna policy. Although Forest did appeal certain rulings the district court made in conjunction with its discussion of matters pertaining to Aetna, Forest has not appealed the holding that Forest was not an additional assured on the Aetna policy.
. Should the Louisiana Supreme Court answer this question affirmatively, we would follow Meloy and remand this case to the district court for a calculation of those expenses attending the defense of Forest only in its capacity as platform owner, as well as a decision as to whether OCS or the Five Underwriters must bear this cost.
. Forest also initially filed a breach of contract suit against A & A in some manner related to the Section 183(a) issue. The district court dismissed this suit. No party has appealed that dismissal.
. State law applies either because of the OCS-LA's assimilation of state law or because federal maritime law looks to the rules of the state having the greatest interest in the resolution of the issues to decide maritime insurance questions in the absence of a "specific and controlling federal rule.” Truehart v. Blandon,
. The Louisiana Supreme Court may choose to invoke its authority under Rule XII to request further briefing on this matter.
. An answer to this question may also affect Albany’s duties to A & A, since Albany must respond to A & A for all costs associated with A & A's defense and indemnity not subsumed with Commercial Union’s $500,000 payment to A & A and Forest.
