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Chapman v. Hiland Partners GP Holdings, LLC

United States District Court, D. North Dakota, Southwestern Division

September 10, 2014

Lenny M. Chapman and Tracy M. Chapman, Plaintiffs,
v.
Hiland Partners GP Holdings, LLC, a Foreign Company, Hiland Partners, LP, a Foreign Partnership, and Hiland Operating, LLC, a Foreign Company, Defendants and Third-Party Plaintiff, (Hiland Operating, LLC)
v.
Missouri Basin Well Service, Inc. and B& B Heavy Haul, LLC, Third-Party Defendants

Page 650

For Lenny M. Chapman, Tracy M. Chapman, Plaintiffs: David S. Maring, LEAD ATTORNEY, James R Hoy, MARING WILLIAMS LAW OFFICE, PC, BISMARCK, ND; Dennis P. Wilkinson, LEAD ATTORNEY, PRO HAC VICE, Thompson, Smith, Woolf & Anderson, PLLC, Idaho Falls, ID; Robert P. Schuster, LEAD ATTORNEY, PRO HAC VICE, Bradley L. Booke, PRO HAC VICE, Robert P. Schuster, P.C., Jackson, WY.

For Hiland Operating, LLC, a Foreign Company, Defendant, 3rd Party Plaintiff: Meredith L. Vukelic, Patrick W. Durick, LEAD ATTORNEYS, PEARCE & DURICK, BISMARCK, ND; John M. Fitzpatrick, PRO HAC VICE, WHEELER TRIGG O'DONNELL LLP, DENVER, CO; Margaret M. Clarke, PRO HAC VICE, Hall, Estill, Hardwick, Gable, Gold, Tulsa, OK; Stephen E. Oertle, PRO HAC VICE, WHEELER TRIGG O'DONNELL LLP, DENVER, CO.

For Hiland Partners GP Holdings, LLC, a Foreign Company, Hiland Partners, LP, a Foreign Partnership, Defendants: Meredith L. Vukelic, Patrick W. Durick, LEAD ATTORNEYS, PEARCE & DURICK, BISMARCK, ND; John M. Fitzpatrick, PRO HAC VICE, WHEELER TRIGG O'DONNELL LLP, DENVER, CO; Margaret M. Clarke, PRO HAC VICE, Hall, Estill, Hardwick, Gable, Gold, Tulsa, OK; Stephen E. Oertle, WHEELER TRIGG O'DONNELL LLP, DENVER, CO.

For Missouri Basin Well Service, Inc., 3rd Party Defendant, Cross Claimant: Joel A. Flom, LEAD ATTORNEY, FLOM LAW OFFICE, P.A., FARGO, ND.

For B& B Heavy Haul, LLC, 3rd Party Defendant, Cross Defendant: Christopher A. Wills, Gordon H. Hansmeier, RAJKOWSKI HANSMEIER, LTD, ST CLOUD, MN.

Page 651

ORDER GRANTING B& B HEAVY HAUL'S MOTION FOR PARTIAL SUMMARY JUDGMENT

Daniel L. Hovland, United States District Judge.

Before the Court is Third-Party Defendant B& B Heavy Haul, LLC's (" B& B" ) motion for partial summary judgment filed on March 6, 2014. See Docket No. 120. The Plaintiffs filed a response in support of the motion on March 27, 2014. See Docket No. 123. Defendant and Third-Party Plaintiff Hiland Operating, LLC, filed a response in opposition to the motion on April 4, 2014. See Docket No. 131. Third-Party Defendant Missouri Basin Well Service, Inc., filed a response in opposition to the motion on April 7, 2014. See Docket No. 132. B& B Heavy Haul, LLC filed reply briefs on April 11, 2014. See Docket Nos. 134 and 135. For the reasons outlined below, the motion is granted.

I. BACKGROUND

Hiland Operating, LLC (" Hiland" ) owns and operates a natural gas processing facility in McKenzie County, North Dakota, known as the Watford City Gas Plant (" gas plant" ). Hiland and Missouri Basin Well Service, Inc. (" Missouri Basin" ) entered into a master service contract on July 23, 2008, wherein Missouri Basin agreed to perform various services for Hiland, including hauling water from the gas plant. Missouri Basin and B& B Heavy Haul, LLC (" B& B" ) also entered into a master service contract on May 24, 2011, in which B& B agreed to provide various services to Missouri Basin, including hauling water and other products from the gas plant. Both master service contracts contain indemnification clauses. However, the contract between Missouri Basin and B& B was never signed by all the parties. It is clear and undisputed that the master service contract was never signed by any representative of Missouri Basin.

Hiland contacted Missouri Basin on October 18, 2011, to have water removed from the condensate tanks located at the gas plant. Missouri Basin subsequently contacted B& B and requested it haul the water. Lenny Chapman, an employee of B& B, was dispatched to the gas plant, arriving shortly after midnight on October 19, 2011. Upon arriving, Chapman and Hiland employee James Olson began the process of connecting the condensate tank to the B& B truck Chapman was driving. A short time later an explosion occurred, injuring Chapman.

Chapman and his wife, Tracy Chapman, filed a lawsuit in federal court against Hiland Partners, LP, Hiland Partners GP Holdings, LLC, and Hiland Operating, LLC on April 26, 2013. The Plaintiffs allege negligence and loss of consortium. Hiland filed a third-party complaint

Page 652

against Missouri Basin and B& B on July 2, 2013. Hiland contends it is contractually entitled to indemnification and a defense from Missouri Basin and B& B. Missouri Basin has filed a cross-claim against B& B seeking a defense and indemnification. The trial is scheduled to commence on January 26, 2015.

B& B filed a motion for partial summary judgment and contends the master service contract with Missouri Basin does not require it to indemnify Missouri Basin or Hiland for Hiland's negligence. B& B apparently admits the master service contract requires it to indemnify Hiland and/or Missouri Basin for B& B's negligence, even though a fully executed contract does not exist. B& B seeks dismissal of Hiland's third-party complaint and Missouri Basin's cross-claim.

II. STANDARD OF REVIEW

Summary judgment is appropriate when the evidence, viewed in a light most favorable to the non-moving party, indicates that no genuine issues of material fact exist and that the moving party is entitled to judgment as a matter of law. Davison v. City of Minneapolis, Minn., 490 F.3d 648, 654 (8th Cir. 2007); see Fed.R.Civ.P. 56(a). Summary judgment is not appropriate if there are factual disputes that may affect the outcome of the case under the applicable substantive law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). An issue of material fact is genuine if the evidence would allow a reasonable jury to return a verdict for the non-moving party. Id.

The Court must inquire whether the evidence presents a sufficient disagreement to require the submission of the case to a jury or whether the evidence is so one-sided that one party must prevail as a matter of law. Diesel Mach., Inc. v. B.R. Lee Indus., Inc., 418 F.3d 820, 832 (8th Cir. 2005). The moving party bears the responsibility of informing the court of the basis for the motion and identifying the portions of the record which demonstrate the absence of a genuine issue of material fact. Torgerson v. City of Rochester, 643 F.3d 1031, 1042 (8th Cir. 2011). The non-moving party may not rely merely on allegations or denials in its own pleading; rather, its response must set out specific facts showing a genuine issue for trial. Id.; Fed.R.Civ.P. 56(c)(1). The court must consider the substantive standard of proof when ruling on a motion for summary judgment. Anderson, 477 U.S. at 252.

III. LEGAL DISCUSSION

A. HILAND'S THIRD-PARTY COMPLAINT


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