Superior Energy Services, LLC v. Cabinda Gulf Oil Co.

FILED
NOT FOR PUBLICATION MAR 03 2016
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
SUPERIOR ENERGY SERVICES, LLC, No. 14-15009
Petitioner - Appellant, D.C. No. 4:13-cv-02056-PJH
v.
MEMORANDUM*
CABINDA GULF OIL COMPANY
LIMITED, a Bermudian corporation,
Respondent - Appellee.
Appeal from the United States District Court
for the Northern District of California
Phyllis J. Hamilton, Chief District Judge, Presiding
Argued and Submitted February 11, 2016
San Francisco, California
Before: SCHROEDER and NGUYEN, Circuit Judges and ADELMAN,** District
Judge.
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
**
The Honorable Lynn S. Adelman, United States District Judge for the
Eastern District of Wisconsin, sitting by designation.
Superior Energy Services, LLC (“Superior”) appeals the district court’s
judgment denying Superior’s petition to compel arbitration. California law
applies.
Superior provided personnel and equipment to Cabinda Gulf Oil Company
Limited (“Cabinda”) for oil explorations off the coast of Angola. Because of the
requirements of Angolan law, however, Cabinda could not contract directly with
Superior, so it instead contracted with an Angolan intermediary, Operatec
Maquinas e Representacoes Limitada (“Operatec”). Operatec then immediately
entered into a subcontract with Superior for the performance of all the work.
Operatec’s role was to process payments from Cabinda to Superior.
When a payment dispute arose between Superior and Operatec, Superior
learned Operatec had not received the payments from Cabinda. This litigation
arose out of Superior’s efforts to arbitrate the dispute with Cabinda by invoking the
arbitration clause in Cabinda’s contract with Operatec. The district court denied
the petition to compel arbitration.
The district court erred in rejecting Superior’s contention that it was an
intended third-party beneficiary of the Cabinda-Operatec contract. The district
court relied on a California Supreme Court case holding that where a subcontractor
was listed by mistake in the general contract, and the parties never intended that
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subcontractor to do the work, the subcontractor was not an intended third-party
beneficiary of the general contract. Southern Cal. Acoustics Co. v. C. V. Holder,
Inc., 456 P.2d 975, 982 (Cal. 1969).
Here, however, as the district court’s own recitation of the factual
background demonstrates, the contracting parties intended for Superior to do all
the work and the payments would go to Superior through Operatec. Cabinda only
contracted with Operatec in order to comply with Angolan law, and Operatec acted
solely as an intermediary.
The more relevant, and controlling, California authority is Outdoor Services,
Inc. v Pabagold, Inc., 230 Cal. Rptr. 73 (Cal. Ct. App. 1986), where the contracting
parties intended for the payments to go to the third party and the court permitted
the third party to enforce the arbitration clause as a third-party beneficiary.
Superior therefore should be regarded as an intended third-party beneficiary of the
main contract and entitled to enforce its arbitration clause.
We need not address Superior’s other contentions.
REVERSED and REMANDED for entry of an order compelling
arbitration.
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