CAZA DRILLING (CALIFORNIA), INC., v. TEG OIL & GAS U.S.A., INC PART-I
Court properly rejected oil company's cross-complaint against drilling company stemming from damages caused by blowout, on basis that exculpatory and limitation of liability provisions in parties' contract were valid--rather than improper attempt under Civil Code Section 1668 to exempt a contracting party from responsibility for fraud, willful injury, or violations of law--where drilling company did not seek or obtain complete exemption from culpability on account of its potential negligence or violation of any applicable regulations, but only sought to limit its liability for economic harm suffered by oil company. The parties foresaw possibility that a blowout could occur and agreed between themselves concerning where the losses would fall. The agreement required drilling company responsibility for damage to its equipment, injury to its employees and certain pollution and contamination removal and control activities. Thus not adversely affecting public or drilling company's employees.
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