FEDERALCourt of Appeals for the Fifth Circuit
2011

One Beacon Ins. Co. v. CROWLEY MARINE SERVICES

648 F.3d 258Court of Appeals for the Fifth Circuit • Decided 2011Enforced

HOLDING

Crowley Marine hired Tubal-Cain to repair a barge. Tubal-Cain hired Rio Marine as a subcontractor. A Rio Marine worker was injured during the work. The court ruled that Tubal-Cain was bound by insurance and indemnification requirements that were listed on Crowley's website and referenced in the purchase order, even though Tubal-Cain never received a hard copy and didn't actually read them. The court enforced these obligations against Tubal-Cain. This matters because it means you can be legally bound to terms you never physically received or reviewed if they're incorporated by reference into your contract.

KEY FINDINGS

Broad Indemnification

Always ask for and review the complete contract terms before signing, including any documents referenced or incorporated by reference. Don't assume you'll get them later.

Insurance Requirements

Check the customer's website and any links in the purchase order for hidden contract terms. Courts will enforce these even if you didn't read them.

Flow-Down

Indemnification and insurance requirements can flow down to you as a subcontractor. Make sure you understand your obligations to defend and insure the project owner before you start work.

FULL COURT OPINION