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Louisiana United Businesses Association Casualty Insurance Co v. J&J Maintenance Inc.

United States District Court, W.D. Louisiana, Lake Charles Division

July 11, 2018

LOUISIANA UNITED BUSINESS ASSOCIATION CASUALTY INSURANCE CO.
v.
J&J MAINTENANCE, INC., ET AL.

          KAY, MAGISTRATE JUDGE

          MEMORANDUM RULING

          S. MAURICE HICKS, JR., CHIEF JUDGE UNITED STATES DISTRICT COURT

         Before the Court are two motions: (1) Migues Deloach Company, LLC's (“Deloach”) “Motion for Summary Judgment” (Record Document 151) and (2) J&J Maintenance, Inc.'s (“J&J”) “Motion for Partial Summary Judgment” (Record Document 155), each seeking a determination of whether Deloach is liable to J&J for attorney's fees and costs incurred by J&J in defense of the underlying claims against it in this matter, as well as attorney's fees and costs incurred in pursuit of reimbursement of those fees against Deloach. For the reasons contained herein, Deloach's motion is DENIED and J&J's motion is GRANTED IN PART and DENIED IN PART.

         FACTUAL AND PROCEDURAL BACKGROUND

         This matter arises out of an accident which occurred on January 24, 2012, wherein Jonathan West (“West”), an employee of Deloach, was electrocuted while transporting construction materials at a remodeling project at a dental clinic in Fort Polk. See Record Document 31-4. On the day of the accident, West was working with his supervisor, Mark Hale (“Hale”), installing metal finish work on the soffit of the clinic. See Record Document 155-4 at 41. Although instructed not to do so, West used a manlift, boomed it away from the building, and caught the power line. See Record Document 157-3 at 41.

         J&J was the general contractor of the remodeling project, and Deloach, West's employer, was operating pursuant to a Subcontract Agreement (the “Subcontract”) under which Deloach was due to supply the earthwork foundation, steel supports, and other items for the project. See Record Document 137-1. The Subcontract contained the following provisions, in pertinent part:

10. (a) To the fullest extent permitted by law, subcontractor (Deloach) shall unconditionally indemnify, defend (with counsel selected by contractor (J&J)) and hold harmless owner, contractor, architect and/or engineer and their subconsultants and all of their affiliates, parents, subsidiaries, officers, directors, employees, successors and assigns (all of which are hereinafter collectively referred to as “indemnitites”), from and against all claims, damages, losses, costs and expenses, including but not limited to attorneys' fees and expenses of dispute resolution (collectively, “indemnified claims”) arising out of or resulting from the performance of subcontractor's work, acts or omissions of subcontractor, negligence, breach of contract and/or breach of warranty by subcontractor, even though such damages are caused in part by the negligence (whether sole, joint or concurrent), strict liability or other legal fault of the contractor of any other indemnitee … Nothwithstanding the foregoing, the indemnification obligation shall be limited to the extent that the subcontractor's indemnification of the indemnitee for the indemnitee's own negligence is specifically prohibited by applicable laws for a particular type of project.
20. In the event Contractor (J&J) employs an attorney to enforce any of the provisions hereof, or to protect its interest in any matter arising under this Agreement, or to collect damages for breach of this Agreement, or to prosecute or defend any suit resulting from this Agreement, or to recover on the surety bond given by Subcontractor under this Agreement, Subcontractor (Deloach) and his surety, jointly and severally, agree to pay Contractor all costs, charges, expenses and attorneys' fees expended or incurred therein …

Id.

         Following the accident, Louisiana United Business Association Casualty Insurance Company (“LUBACI”) paid workers' compensation death benefits to West's heirs. LUBACI then filed suit to recoup those benefits, asserting it was entitled to reimbursement because the accident was caused by the negligence of several defendants, including J&J, Entergy Louisiana, LLC (“Entergy”), and Volvo Construction Equipment Rents, Inc. (“Volvo”). See Record Document 31-4.

         On December 26, 2012, J&J filed its first Third-Party Demand against Deloach alleging that J&J and Deloach entered into a subcontract to perform several aspects of the remodeling project. See Record Document 151-1. J&J alleged under the Subcontract that Deloach agreed to defend and indemnify J&J against any damages arising out of the performance of Deloach's work. See id. Deloach filed an Exception of Prematurity regarding these defense and indemnity claims, which was sustained by the 30th Judicial District Court, Vernon Parish, on September 3, 2013. See Record Document 137. Additionally, J&J was named as a cross-defendant on a related claim in Entergy's cross-claim filed on March 26, 2013. See Record Document 151-2. Subsequent to this cross-claim, J&J filed a First Supplemental and Amending Third-Party Demand against Deloach, asserting that Deloach was liable for defense and indemnification against Entergy's claims as well. See Record Document 151-3.

         After J&J filed an Exception of No Right of Action asserting Louisiana's workers' compensation immunity under La. R.S. 23:1032 (“LWCA immunity”), the claims presented by LUBACI against J&J were dismissed in a Consent Judgment signed on February 24, 2014. See Record Document 155-6. On May 27, 2015, this case was removed to this Court pursuant to 28 U.S.C. § 1331. See Record Document 1. On May 19, 2017, J&J filed its Cross-Claim and Renewed Third-Party Demand against Deloach. See Record Document 137. Entergy's Cross-Claim against J&J was dismissed via a settlement agreement procured by Deloach on November 13, 2017.[1] Thus, the only remaining claim at issue in this matter is J&J's claims against Deloach for the costs of defense, including attorneys' fees incurred in defending against claims brought by LUBACI and Entergy, as well as attorneys' fees and costs incurred in prosecuting this claim against Deloach.

         On December 19, 2017, Deloach filed its Motion for Summary Judgment on J&J's cross-claims. See Record Document 151. J&J filed its opposition on December 29, 2017, to which Deloach replied on January 5, 2017. See Record Documents 157 and 158. The Court allowed J&J to file a sur-reply, which it did so on January 17, 2018. See Record Document 164. In addition to its opposition, J&J filed its own Motion for Partial Summary Judgment on December 29, 2017. See Record Document 155. Deloach opposed the motion on January 12, 2018, and J&J replied on January 18, 2018. See Record Document 160 and 161. Deloach also filed a sur-reply on January 22, 2018. See Record Document 169. The issues have been briefed extensively by the parties; therefore, the matter is ripe for decision.

         LAW AND ANALYSIS

         I. Summary Judgment Standard

         Rule 56 of the F.R.C.P. governs summary judgment. This rule provides that the court “shall grant summary judgment 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.” F.R.C.P. 56(a). Also, “a party asserting that a fact cannot be or is genuinely disputed must support the motion by citing to particular parts of materials in the record, including ... affidavits ... or showing that the materials cited do not establish the absence or presence of a genuine dispute, or that an adverse party cannot produce admissible evidence to support the fact.” F.R.C.P. 56(c)(1)(A) and (B). “If a party fails to properly support an assertion of fact or fails to properly address another party's assertion of fact as required by Rule 56(c), the court may ... grant summary judgment.” F.R.C.P. 56(e)(3).

         In a summary judgment motion, “a party seeking summary judgment always bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the pleadings ... [and] affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 2553 (1986) (internal quotations and citations omitted). If the movant meets this initial burden, then the non-movant has the burden of going beyond the pleadings and designating specific facts that prove that a genuine issue of material fact exists. See Celotex, 477 U.S. at 325, 106 S.Ct. at 2554; see Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994). A non-movant, however, cannot meet the burden of proving that a genuine issue of material fact exists by providing only “some metaphysical doubt as to the material facts, by conclusory allegations, by unsubstantiated assertions, or by only a scintilla of evidence.” Little, 37 F.3d at 1075.

         Additionally, in deciding a summary judgment motion, courts “resolve factual controversies in favor of the nonmoving party, but only when there is an actual controversy, that is when both parties have submitted evidence of contradictory facts.” Id. Courts “do not, however, in the absence of any proof, assume that the nonmoving party could or would prove the necessary facts.” Id.

         II. Analysis

         A. Timeliness

         Deloach argues J&J's motion for partial summary judgment is untimely; therefore, the Court should dismiss it. See Record Document 160 at 4. Conversely, J&J argues its motion is a motion for “partial summary judgment” and is beyond the scope of the dispositive motion deadline as set forth in the Court's Scheduling Order. See Record Document 161. J&J's argument is incorrect. First, a “dispositive motion” includes a motion that, if granted, would result in the determination of a particular claim on the merits. See Tripoli Rocketry Ass'n, Inc. v. Bureau of Alcohol, Tobacco, Firearms & Explosives, 698 F.Supp.2d 168, 173 (D.D.C. 2010). J&J's labeling of its motion as one for “partial summary judgment” does not defeat what the motion seeks - a determination of whether Deloach is liable for the costs of defense, including attorneys' fees incurred in defending against claims of LUBACI and Entergy, as well as attorneys' fees and costs incurred in J&J's prosecution of this claim against Deloach. Additionally, courts have traditionally treated motions for “partial summary judgment” as dispositive motions. See Geiserman v. MacDonald, 893 F.2d 787, 790 (5th Cir. 1990); Arnold v. Nat'l Cas. Co., 2014 WL 50832, *2 (W.D. La. 2014); S. Filter Media, LLC v. Halter, 2014 WL 4278788, *4 (M.D. La. 2014); Pratt Paper (LA), LLC v. JLM Advanced Tech. Servs., Inc., 2016 WL 5854235, *2 (W.D. La. 2016); Hinton v. Pike Cty., 2017 WL 2378361, *2 (S.D.Miss. 2017). Accordingly, J&J's “motion for partial summary judgment” is considered a dispositive motion.

         Per the Court's Scheduling Order, all dispositive motions were due ninety (90) days before trial. See Record Document 136 at 1. With a trial date of March 19, 2018, this made all dispositive motions due on December 19, 2017. See Record Document 135. J&J filed its Motion for Partial Summary Judgment on December 29, 2017, ten (10) days after the deadline. See Record Document 155. Therefore, J&J's motion is considered untimely. However, under the circumstances in the instant matter, the Court does not believe dismissal would be proper. J&J's motion seeks a ruling on the same legal question posed in Deloach's motion - whether Deloach is liable for the costs of defense incurred in defending and prosecuting claims arising from the subcontract - and there are no facts in dispute between the parties. While J&J's motion was filed late, the Court finds that considering the motion will not unduly prejudice Deloach and will allow the Court to render judgment on a purely legal question without requiring this issue to go to trial. See Pratt Paper (LA), LLC v. JLM Advanced Tech. Servs., Inc., 2016 WL 5854235, *2 (W.D. La. 2016) (“The decision to permit an untimely motion is ultimately at the judge's discretion.) (citing S&W Enters., L.L.C. v. Southtrust Bank of Ala., 315 F.3d 533, 536-37 (5th Cir. 2003)). Therefore, the Court will consider J&J's Motion for Partial Summary Judgment despite its untimely filing.[2]

         B. Interpretation of the Subcontract's Indemnity Provision

         In its motion for summary judgment, Deloach argues that the Subcontract limits reimbursement of defense costs to situations of negligence or breach committed only by Deloach. See Record Document 151-6 at 6-7. Conversely, J&J asserts Deloach's indemnification obligations are triggered not just by its own negligence, but also by any claims “arising out of or resulting from the performance of [Deloach's] work.” Record Document 157 at 4. In its Reply, Deloach argues that J&J has not shown the “connexity” between the accident and the work to trigger the indemnity provision.[3] See Record Document 158 at 3-6.

         Under Louisiana law, the language in an indemnity agreement dictates the obligations of the parties. See Bollinger Marine Fabricators, LLC v. Marine Travelift, Inc., 2015 WL 1638115, *4 (E.D. La. 2015), citing Kinsinger v. Taco Tico, Inc., 861 So.2d 669, 671 (La.App. 5 Cir. 2003). “[I]ndemnity provisions are construed in accordance with general rules governing contract interpretation. When the terms of a contract are unambiguous and lead to no absurd consequences, [courts] interpret them as a matter of law.” Id., quoting Liberty Mut. Ins. Co. v. Pine Bluff Sand & Gravel Co., 89 F.3d 243, 246 (5th Cir. 1996) (internal citations omitted). While a contract of indemnity whereby an indemnitee is indemnified ...


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