Moll v. Brown & Root Inc ( 2000 )

UNITED STATES COURT OF APPEALS
For the Fifth Circuit
No. 99-30329
MARK N MOLL; BEVERLY MOLL,
Plaintiffs - Appellants,
VERSUS
BROWN & ROOT INC., ET AL,
Defendants,
ABB LUMMUS GLOBAL, INC., formerly known as Lummus Crescent, Inc.,
COMBUSTION ENGINEERING, INC.,
Defendants-Appellees,
VERSUS
BEAIRD INDUSTRIES, INC., formerly known as Riley-Beaird, Inc.;
FLUOR DANIEL, INC., formerly known as Fluor Engineers and
Constructors, Inc.,
Defendants-Appellants.
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No. 99-30526
MARK N MOLL; BEVERLY MOLL,
Plaintiffs - Appellants,
VERSUS
BROWN & ROOT INC., ET AL,
Defendants,
H B ZACHRY COMPANY,
Defendant-Appellee,
VERSUS
FLUOR DANIEL, INC., formerly known as Fluor Engineers
and Constructors, Inc.; BEAIRD INDUSTRIES, INC.,
formerly known as Riley-Beaird, Inc.,
Defendants-Appellants.
Appeals from the United States District Court
For the Eastern District of Louisiana
July 24, 2000
Before JONES, DUHÉ, and WIENER, Circuit Judges.
PER CURIAM:
In this consolidated appeal of a grant of summary judgment, we
AFFIRM the district court's conclusion that Plaintiffs/Appellants'
claims against Appellees, ABB Lummus Global, Inc. and Combustion
Engineering, Inc. (collectively “Lummus”) and H.B. Zachry Company
(“Zachry”), are perempted under Louisiana Revised Statute Section
9:2772.1
BACKGROUND
Plaintiff/Appellant, Mark N. Moll (“Moll”) suffered injuries
while working on an industrial furnace (“furnace twenty-one”) at
1
The version of the statute in effect at the time Moll was
injured used the term “preemption”. A later amendment to Section
9:2772 substituted the term “perempted” for the term “preempted”
throughout the provision.
2
Union Carbide's Olefins II Unit of its petrochemical plant in Taft,
Louisiana. The Olefins II Unit is a seven-story structure built on
a concrete foundation and permanently attached to land owned by
Union Carbide which could not be removed without substantial damage
to itself and the soil to which it is anchored.2 Attached to
Furnace-21 of the Olefins II Unit is an exterior muffler silencer
which (1) was designed and fabricated elsewhere by Defendants-
Appellees Fluor Daniel, Inc. and Beaird Industries, Inc., (2) was
specified by Lummus, the engineering firm that designed and
engineered the Olefins II Unit, and (3) as specified, was installed
in the construction of the Olefins II Unit by Zachry, the general
contractor. According to Moll, while he was attempting to release
pressurized steam from the furnace, the muffler disconnected from
its ventline piping causing a piece of the muffler to strike him in
the face. Moll sued3 under Louisiana law a number of parties
including Fluor and Beaird as designers and fabricators of the
muffler, Lummus as design engineer of the Olefins II Unit, and
Zachry as general contractor for the Unit.
Lummus moved for summary judgment asserting that Louisiana's
2
Louisiana Civil Code Article 466 defines things that are
permanently attached to an immovable as things that “cannot be
removed without substantial damage to themselves or to the
immovable to which they are attached.” LA. CIV. CODE art. 466
(1979). The evidence clearly indicates that the Olefins II Unit
could not be removed without substantial damage to the ground to
which it is attached.
3
Moll's wife is also a named Plaintiff/Appellant.
3
ten year peremptive period for actions involving design and/or
construction of immovables or improvements to immovables had run.
See LA REV. STAT. § 9:2772 (1964). The district court denied this
motion. Upon motion for reconsideration, however, the district
court granted Lummus' motion. Shortly after the court's second
ruling, Zachry moved for summary judgment on the same grounds. The
court granted Zachry's motion. Plaintiffs/Appellants, the Molls,
along with Defendants/Appellants, Beaird Industries, Inc. and Fluor
Daniel, Inc., appealed both rulings asserting that the muffler at
issue is not an immovable and falls outside the scope of Section
9:2772. Albeit for reasons differing from those expressed by the
district court, we AFFIRM that court’s ultimate conclusion that
plaintiffs/appellants’ actions against Lummus and Zachary are
perempted under § 9:2772.4
STANDARD OF REVIEW
We review a grant of summary judgment de novo, viewing the
facts and inferences in the light most favorable to the party
4
The district court reached its conclusion of Section 9:2772
peremption for Lummus and Zachary by focusing on the muffler and
analyzing its nature under Louisiana Civil Code art. 466, doing so
before this Court’s decision in Prytania Park Hotel v. General Star
Indemnity Co., 179 F.3d 169 (5th Cir. 1999) and concluding that the
muffler is an immovable or an improvement to an immovable for
purposes of Section 9:2772. In contrast, we resolve the issues as
to the parties presently before us by determining the nature of
the Olefins II Unit in its entirety, not by focusing solely on the
muffler as a discreet element of the Unit, analyzing the treatment
of “improvement” throughout the Civil Code and the applicable
jurisprudence.
4
opposing the motion. See Hall v. Gillman, Inc., 81 F.3d 35, 36-37
(5th Cir. 1996). Summary judgment is appropriate if the record
discloses “that there is no genuine issue as to any material fact
and that the moving party is entitled to a judgment as a matter of
law.” Fed. R. Civ. P. 56(c); accord Celotex Corp. v. Catrett, 477
U.S. 317, 322 (1986).
DISCUSSION
I. Section 9:2772
The 1964 version of Section 9:2772 reads in relevant part:
No action whether ex contractu, ex
delicto or otherwise, to recover on a contract
or to recover damages shall be brought against
any person performing or furnishing the
design, planning, supervision, inspection or
observation of construction or the
construction of an improvement to immovable
property:
(1) More than ten years after the date of
registry in the mortgage office of acceptance
of the work by owner; or
(2) If no such acceptance is recorded
within six months from the date the owner has
occupied or taken possession of the
improvement, in whole or in part, more than
ten years after the improvement has been thus
occupied by the owner....
LA REV. STAT. § 9:2772 (1964) (emphasis supplied). While the parties
focus on whether or not the allegedly defective muffler was an
immovable under this provision, we do not find it necessary to
resolve this dispute. Rather, we conclude that the Olefins II
Unit, as designed by Lummus and constructed by Zachry, is “an
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improvement to immovable property.” Accordingly, Section 9:2772
perempts Plaintiffs'/Appellants' claims against both Appellees.
II. “Improvements” under the Louisiana Civil Code
The Olefins II Unit stands upon land which is an “immovable.”
See LA. CIV. CODE art. 462 (1979) (“Tracts of land, with their
component parts, are immovables.”). Although the Civil Code does
not specifically define “improvement,” a number of Articles suggest
that man-made constructions permanently attached to the ground are
improvements.5 For instance, both Civil Code Article 493
concerning “Ownership of improvements” and Article 2367.1
concerning “Improvements on separate property” begin with the
phrase “Buildings, other constructions permanently attached to the
ground, and plantings made on the land....” See LA. CIV. CODE art.
493 (1984), LA. CIV. CODE art. 2367.1 (1990). Similarly, Civil Code
Article 497 dealing with “Constructions by bad faith possessors”
provides that “[w]hen constructions, plantings, or works are made
by a bad faith possessor, the owner of the immovable may keep them
or he may demand their demolition.” LA. CIV. CODE art. 497 (1979).
5
This case involves the classification of a man-made
construction. Not all improvements to immovables are such
constructions e.g. clearing forests or draining swamps. Although
we find that all man-made constructions permanently attached to the
ground are “improvements,” not all “improvements” are man-made
constructions permanently attached to the ground. Accordingly, this
definition of what man-made constructions are “improvements” is
neither exhaustive as to man-made constructions, nor applicable to
all “improvements.” Rather, we wish only to demonstrate that the
Olefins II Unit is an “improvement to an immovable” under Louisiana
law.
6
Article 497 reads further that when the owner of the land does not
demand demolition or removal, he must pay to the bad faith
possessor the current value of materials and workmanship of the
“separable improvements that he has kept or the enhanced value of
the immovable.” Id.
In referring to “separable” improvements, Article 497 implies
the existence of “inseparable” improvements. At first blush, this
implied distinction could suggest that permanence of attachment to
the ground should not be a touchstone for determining what is or is
not an improvement because both separable (read: movable) and
inseparable (read: immovable) items could be improvements. The
Louisiana Legislature's Revision Comments to Article 497, however,
suggest a different reading:
(c) According to Louisiana jurisprudence,
separable improvements are those that do not
become merged with the soil and remain
distinguishable as individual works, such as
houses, barns, carports and the like.
Inseparable improvements are those that become
permanently merged with the soil and lose
their identity as separate works, such as
clearing, draining, filling in, digging
irrigation ditches, building levees,
reservoirs, or lakes, and the like. In
effect, separable improvements are new
constructions subject to accession, while
inseparable improvements are useful
expenditures....
....
(e) This provision applies to buildings,
other constructions permanently attached to
the ground, standing timber, unharvested crops
or ungathered fruits of trees, and things that
become component parts of an immovable....
7
1979 La. Acts 180 § 1 (citation omitted). Judging from this
expression of legislative intent, we conclude that “separability”
relates to an item's identity rather than its physical permanence
or portability. In other words, while a house, barn, or carport is
a “separable improvement” that retains an identity separate from
the ground upon which it is built, it is also a “building, or other
construction permanently attached to the ground.“
Although not as on point as Articles 493, 497, and 2367.1,
Article 558 concerning “Improvements and alterations” made by a
usufructuary suggests a difference between “improvements” and
“alterations” that at least permits an inference that
“improvements” are somehow more substantially attached to the
ground than are mere “alterations” to property. See LA. CIV. CODE
art. 558 (1977). Moreover, Articles 601 and 602 concerning a
usufructuary's “Removal of improvements” and “Set off against
damages” both refer to “improvements ... that cannot be removed”
from property subject to a usufruct. See LA. CIV. CODE art. 601
(1977), LA. CIV. CODE art. 602 (1977). Once again, although the
descriptive phrase “cannot be removed” might suggest eschewing our
permanent attachment analysis, looking to the Legislature's Comment
concerning Article 602 we note that this phrase reflects only the
separable/inseparable dichotomy noted in Article 497. See 1976 La.
Acts 103 § 1 (“[Article 602] changes the law as it makes setoff
(sic) subject to two conditions: (1) the improvements must be
inseparable; and (2) the improvements must be made in accordance
8
with Article 558.”). In the end, we are confident that the
Louisiana Civil Code supports our holding that the Olefins II Unit,
a seven story man-made construction permanently attached to the
ground as part of a chemical processing plant, is an “improvement
to an immovable” under Louisiana law.
II. Judicial Interpretations of Section 9:2772 “Improvements”
The conclusion of those courts that have examined the term
“improvement” in the context of Section 9:2772 bolsters our holding
that the Olefins II Unit is an “improvement to an immovable.” In
KSLA-TV, Inc. v. Radio Corporation of America, 693 F.2d 544 (5th
Cir. 1982), we affirmed the district court's ruling that a suit
against the designer and fabricator of a television broadcast
tower, 1800 feet in height and resting on a concrete slab embedded
fifteen feet into the ground, was a claim arising from “the
construction of an improvement to [real] property.” Id. at 545-46.
Similarly, in Dugas v. Cacioppo, 583 So. 2d 26 (La. App. 5th Cir.
1991), the Louisiana Court of Appeal for the Fifth Circuit ruled
that the term “improvements to immovable property” under Section
9:2772 can apply both to a new house and to subsequent additions
made to the house. Dugas, 583 So. 2d at 27. Conversely, in Cosse
v. Allen-Bradley Company, 601 So. 2d 1349 (La. 1992), the Louisiana
Supreme Court ruled that a scrap conveyor that was “suspended from
the floor of a building and attached with bolts” and that would
have to be disassembled and taken out in pieces to be removed was
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not “an improvement to an immovable.” See id. at 1354.
Although these three cases do not constitute a particularly
large sample, they do demonstrate a recognizable pattern. In each
instance in which a court has applied the term “improvement to an
immovable” to a man-made construction permanently attached to the
ground, i.e. the broadcast tower in KSLA-TV and the house in Dugas,
it has deemed these items to be “improvements.” On the other hand,
when faced with a man-made construction unattached to the ground,
i.e. the scrap conveyor in Cosse, the court ruled that the item was
not an “improvement to an immovable.” As the Olefins II Unit is
anchored to the ground in a manner similar to the broadcast tower
in KSLA-TV we find that it, too, is “an improvement to an
immovable” under Louisiana law.
CONCLUSION
For the reasons stated herein, we AFFIRM the district court's
conclusion on summary judgment that Plaintiffs/Appellants' claims
against Lummus and Zachry are perempted under Louisiana Revised
Statute Section 9:2772.
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