## Facts

- Exxon owned a fixed offshore platform off Louisiana; Diamond M owned a drilling rig on the platform.
- Exxon contracted with Diamond M for drilling services (July 15, 1975) and separately contracted with Offshore Casing Crews, Inc. for casing services (Jan. 12, 1976).
- The Exxon–Offshore contract required Offshore to indemnify Exxon for injuries “in any way resulting from” Offshore’s negligent acts or omissions and for claims by Offshore’s employees, even if arising from Exxon’s joint or concurrent negligence.
- Foreman, an Offshore employee, was injured while working on the platform and on the Diamond M rig.
- Foreman sued Exxon and Diamond M; Diamond M sought contractual indemnity/contribution from Exxon under their contract; Exxon sought contractual indemnity from Offshore under the Exxon–Offshore contract.
- Over Offshore’s objection, the jury allocated fault: Exxon 10%, Diamond M 55%, Offshore 35%.
- The parties settled Foreman’s damages at $323,000; the district court then determined indemnity obligations.
- The district court required Offshore to indemnify Exxon for Exxon’s direct liability to Foreman but refused to require Offshore to indemnify Exxon for amounts Exxon owed Diamond M under the Exxon–Diamond M indemnity agreement.

## Issues

1. Whether the Exxon–Offshore indemnity clause required Offshore to indemnify Exxon for Exxon’s direct liability to Foreman, an Offshore employee, when the injury resulted in part from Offshore’s negligence.
2. Whether the Exxon–Offshore indemnity clause required Offshore to indemnify Exxon for Exxon’s separate contractual indemnity obligation to Diamond M arising from the Exxon–Diamond M contract.

## Decision

- The Fifth Circuit affirmed.
- Offshore was required to indemnify Exxon for Exxon’s direct liability to Foreman because the contract covered injuries resulting from Offshore’s negligence, including claims by Offshore employees, even with concurrent Exxon negligence.
- Offshore was not required to indemnify Exxon for sums Exxon owed Diamond M under Exxon’s separate indemnity contract with Diamond M because the Exxon–Offshore contract did not clearly and unequivocally assume that distinct contractual liability.
- Offshore’s employer tort immunity did not defeat enforcement of the contractual indemnity; allocating Offshore’s fault was permissible to determine whether the injury resulted from Offshore’s negligence within the contract’s terms.

## Legal Principles

- Indemnity provisions are strictly construed and extend only to liabilities clearly within their terms.
- A contract will not be read to require an indemnitor to cover the indemnitee’s separate contractual indemnity owed to a third party absent clear, express, or unequivocal language to that effect.
- An employer’s tort immunity does not bar enforcement of a contractual indemnity obligation for an employee’s injury when the contract plainly covers such claims.
- Fault allocation may be used to determine causation relevant to contractual indemnity, even when the employer is not a tort defendant in the principal claim.

## Conclusion

The court enforced Offshore’s indemnity promise as to Exxon’s direct liability for an employee injury attributable in part to Offshore’s negligence, but it refused to extend the same clause to cover Exxon’s independent contractual indemnity obligation to Diamond M without explicit language shifting that separate contractual risk.


Foreman v. Exxon Corp., 770 F.2d 490 (5th Cir. 1985)