Directional Driller’s Employee’s Claims Against Lease Owner And Drilling Contractor Defeated On Summary Judgment

The Texas owner of a North Dakota oil and gas lease contracted with a drilling company to provide a drilling rig and drilling services (the “drilling contractor”), and also contracted with another company to perform directional drilling services (the “directional driller”).  In September 2012, wind blew a tear in a plastic liner covering the ground surface at the well site, which injured an employee of the directional driller, who filed suit against the lease owner and the drilling contractor alleging negligence and gross negligence for the failure to maintain a safe workplace.  After determining that North Dakota, and not Texas, law applied, the U.S. District Court for the Southern District of Texas granted summary judgment to the lease owner and the drilling contractor.

Under North Dakota law, an employer of an independent contractor is generally not liable for acts or omissions of the independent contractor, unless the retained control doctrine is applicable.  This doctrine is explained in the Restatement (Second) of Torts, which provides: “One who entrusts work to an independent contractor, but who retains the control of any part of the work, is subject to liability for physical harm to others for whose safety the employer owes a duty to exercise reasonable care, which is caused by his failure to exercise his control with reasonable care.”  Based on the evidence in the record, the court concluded that neither the lease owner or the drilling contractor owed a duty to the directional driller’s employee.  The worker did not present evidence that the lease owner retained control over the operative details of the directional driller’s work and although the lease owner provided plans to the directional driller regarding the location and direction of the hole to be drilled, it was the responsibility of the directional driller to determine how to carry out the plan.  With respect to the drilling contractor, the retained control exception was not applicable because the drilling contractor did not contract with the directional driller and it could not be held liable under a premise liability theory because it was not the owner of the premises.