American Home Assurance Company, Plaintiff-Counter-Defendant-Appellee v. Unitramp Limited and Unitramp, S.A., Defendants-Counter-Claimants-Appellants

JERRY E. SMITH, Circuit Judge:

Unitramp Limited and Unitramp, S.A. (“Unitramp”), appeal a judgment that American Home Assurance Company (“American”) owes them no indemnity for damages suffered following a delivery of watered fuel. We reverse and render.

I

Unitramp time chartered the MW GLENI-TA, a general cargo vessel, and bought its fuel from Enjet Refining, Inc., a fuel broker insured by American. On June 9, 1993, En-jet supplied 450 metric tons of fuel to the M/V GLENITA in Corpus Christi Bay; the fuel was delivered from Enjet’s Ingleside facility and loaded in segregated bunkers aboard the…