Author: Virginia J. "Jenny" McLin

Make Sure You Are Sure! – A Comment on the Finality of Settlement Agreements under Louisiana Law

09.08.2023

Preparing for a trial is a tense and stressful process for attorneys and their clients. Sometimes, during trial preparation, a crucial piece of evidence can come to light that may push a case from a path towards trial to a path towards a settlement agreement. A “settlement” or “compromise” under Louisiana law is just that – an agreement between the parties to settle the dispute raised in the lawsuit, usually with the exchange of a sum of money. Often, settlements are reached in the weeks leading up to trial or even on the courthouse steps.

This type of scenario occurred in Nola Title Company, LLC v. Archon Information Systems. While in the thick of trial preparation, audio recordings from one of the parties were discovered. That party concluded this evidence would be prejudicial to its case at trial, which spurred settlement negotiations. The parties eventually agreed to a compromise and notified the court of the settlement via an email to the judge’s law clerk. The next day, the attorneys reported to court and verbally outlined the terms of the settlement agreement on the official court record.

Two weeks later, the defendants hired new counsel. Two months after that, counsel for the plaintiff forwarded the formal settlement documents to memorialize the agreement that was made between the parties and entered into the court’s record. However, the defendants refused to sign the paperwork and did not timely make the payments that previously were agreed upon. Therefore, the plaintiff filed a motion to enforce the settlement agreement.

In opposition to the motion to enforce, the defendants argued: 1) that their prior counsel did not have authority to enter into the settlement agreement; and 2) that the agreement on the record of the court was invalid because it did not include a provision about the audio recording, which the defendant claimed was a key element of the agreement between the parties. After an evidentiary hearing, the trial court found that the settlement that was stated on the record was an enforceable settlement agreement.

The Louisiana Court of Appeals for the Fourth Circuit affirmed the ruling of the trial court. In its opinion, the appellate court includes a summary of the law governing settlements in Louisiana. After a thorough review of the applicable law, the court came to the following conclusions:

The settlement agreement on the record of the court was a binding settlement agreement, even if the parties contemplated a future formal written agreement;
When a compromise is placed on the record, the recital must include full disclosure of the material terms;
Any “missing terms” from the recorded settlement agreement were not a material element of the settlement; and
The defendants’ prior counsel had authority to enter into the settlement as written.

Based upon the court’s ruling, if the parties have a meeting of the minds and settlement terms are entered on the trial court record, there are no “do-overs” or “take-backs.” It is important to “make sure you are sure” when entering the crucial courthouse steps settlement agreement.

References:

Nola Title Company, LLC v. Archon Information Systems, et. al., 2022-CA-0967 (La. App. 4 Cir. 4/13/23), 360 So. 3d 166.

Louisiana Supreme Court Uses Reason to Decide Case Involving Tragic Facts

09.16.2022

Sometimes in law, the facts of a case may threaten to eclipse the legal issue. However, Louisiana law instructs the fact finder to see through the facts, and their sometimes tragic nature, and apply the law as written. As Aristotle once wisely said, “The Law is reason free from passion.”

In Kazan, et. al. v. Red Lion Hotels Corporation, et. al., 2021-CC-01820 (La. 6/29/22), the Louisiana Supreme Court recently ruled on a case with tragic facts, and its ruling provides an example of Aristotle’s description of law in action. In Kazan, a female patron was in the parking lot of a motel when a male patron approached her and used Kazan’s vehicle to abduct her from the premises. The car was later found submerged in a lake, and Kazan’s body was recovered from the water. The family filed a tort suit against several parties, including the motel’s owner and its insurer, the Great Lakes Insurance Company SE.

Great Lakes filed a motion for summary judgment and asked to be dismissed on grounds that coverage for the event was excluded from its policy. Specifically, the insurer argued that bodily injury caused by an “assault,” “battery,” or “physical altercation” was excluded under the policy’s terms. Great Lakes further argued that the kidnapping and ultimate death of the patron was excluded under the policy as bodily injury caused by an assault, battery, or physical altercation. The Louisiana Supreme Court agreed and reversed the decision of the trial and appellate courts.

Under Louisiana law, “[a]n insurance policy is a contract between the parties and should be construed using the general rules for the interpretation of contracts.” Id. at p. 3. “When the words of an insurance policy are clear and explicit and do not lead to absurd consequences, courts must enforce the language as written.” Id. at p. 3. “Courts lack authority to alter the terms of an insurance policy under the guise of interpretation and should not create an ambiguity where none exists.” Id. at p. 3.

With these basic rules in mind, the Court carefully reviewed the wording of the exclusion in the Great Lakes policy which stated as follows: “This insurance does not apply to ‘bodily injury,’ ‘property damage,’ or ‘personal advertising injury’ arising out of an ‘assault,’ ‘battery,’ or ‘physical altercation.’” “Physical altercation” was defined in the policy as “a dispute between individual [sic] in which one or more persons sustain bodily injury arising out of the dispute.” Citing Merriam-Webster’s dictionary, the Court defined the term “dispute” as “verbal controversy” or “quarrel.”

Based upon the evidence in the case, the Court found the female patron was involved in a “dispute” with her male attacker, and ultimately sustained bodily injury as a result of the dispute. Therefore, the patron was injured in a physical altercation, as defined under the specific terms of the Policy, and coverage for the event was excluded under the policy’s terms.

The Court noted as follows: “The facts of this case are undoubtedly tragic. Nonetheless, absent a conflict with statutory provisions or public policy, insurers are entitled to limit their liability by imposing reasonable conditions upon the policy obligations they contractually assume. That is what Great Lakes did in the insurance policy at issue here.” Despite the tragic facts presented in the case, in so holding, it appears the court agreed with Aristotle’s belief that the Law is Reason Free from Passion.

COVID-19 Case Presents Interesting Constitutional and Procedural Issues

12.31.2020

COVID-19 stretched our legal system and raised questions not easily answered by existing law. One recent question surrounds a dispute between the Governor and the State Legislature regarding the constitutionality of the Governor’s proclamation of a public health emergency in response to COVID-19. Recently, in Governor John Bel Edwards v. Louisiana State Legislature, Louisiana House of Representatives, & Clay Schexnayder, in his official capacity as Speaker of the House of Representatives, 2020-CA-1407, the Louisiana Supreme Court was asked to gauge the validity of the legislature’s termination of Governor Edwards’ proclamation. However, the Court did not reach the constitutional questions and remanded the case.

The Governor filed suit to challenge the Legislature’s termination of his COVID-19 proclamation. He argued that the termination was null and void citing both constitutional and non-constitutional grounds. Because the trial court found the termination unconstitutional, it did not address the procedural and non-constitutional challenges raised.

On appeal, the Supreme Court held that the trial court erred in reaching the issue of constitutionality prior to determining whether the dispute could be resolved on non-constitutional grounds. Louisiana law dictates that courts should avoid decisions based upon constitutional grounds unless the constitutional issue is essential to resolution of the case. Although the issues to be addressed were important to the citizens of Louisiana, the Court stated “it is critical a case must reach this court in the proper procedural posture to warrant our review of a ruling on constitutionality.”

The case highlights the role of the Louisiana Supreme Court and reminds both attorneys and the public of how issues are addressed and decided. The Court was express that the issues presented in Edwards were novel and important and may ultimately be issues the high court will choose to address. However, the Court recognized that its powers of constitutional review are constrained by procedure. A civics lesson in the midst of the COVID-19 pandemic.

Virginia “Jenny” McLin is a partner at Keogh Cox who practices in the fields of corporate litigation, insurance defense and workers compensation defense. When she is not practicing law, Jenny can be found volunteering with the Junior League of Baton Rouge; cheering for the LSU Tigers with her husband Ryan; or shuffling her two kids to and from dance practice.

Premises Liability: Defense Summary Judgment in an Accident Involving Rolling Chair

09.01.2020

A recent decision from the Louisiana Third Circuit Court of Appeal re-affirms the merchant liability rules. In Carolyn R. Miller and Steven Rathjen v. Willis Communications, et. al., 19-787 (La. App. 3 Cir. 6/24/20), the plaintiff was an elderly patron of an AT&T store. Plaintiff and her daughter were assisted at the customer service desk, and plaintiff took a seat in a rolling chair. When she attempted to stand up, the rolling chair moved, and she fell to the floor breaking a hip.

Plaintiff filed suit under the merchant’s liability statute, La. R.S. 9:2800.6. Per the statute, if a negligence claim is brought against a merchant by a person lawfully on the merchant’s premises for injuries sustained because of a fall, then plaintiff must prove: 1) that the condition of the merchant’s premises presented an unreasonable risk of harm that was reasonably foreseeable; 2) that the merchant created the risk or had actual or constructive knowledge of the condition; and 3) that the merchant failed to exercise reasonable care to address the unreasonable risk of harm. Plaintiff argued that an unreasonable risk of harm was created when she was given a chair on rollers on flooring allegedly unsafe for use with a rolling chair.

The defendants filed a motion for summary judgment, which was denied by the trial court. The appellate court reversed and entered summary judgment. The appellate court found that the critical element of plaintiff’s burden of proof was missing – any defect in the rolling chair. Plaintiff admitted that the chair was not defective. Instead, she argued that she should not have been given a rolling chair to sit in because of her age, obvious mobility issues, and because the rolling chair was unsafe on the flooring of the store.

Evidence was presented that: 1) plaintiff’s daughter was able to maneuver the rolling chair without incident; 2) the daughter did not believe that plaintiff would have trouble navigating the rolling chair; and 3) no other customer had ever fallen out of one of the rolling chairs. Simply, what occurred at the AT&T store was an accident, for which AT&T and its employees were not responsible. Plaintiff, well aware of her own physical limitations, chose to sit in a rolling chair that she physically was unable to get out of on her own. Based upon this evidence, the court reasoned that plaintiff did not prove that: 1) the rolling chair posed an unreasonable risk of harm; or 2) the merchant possessed actual or constructive knowledge of any defect.

Following decisions which imposed harsh standards upon retailers, the Louisiana Legislature adopted the merchant’s liability statute to limit recovery to cases involving true negligence. The Carolyn R. Miller decision demonstrates that the statute is properly used in motion practice to resolve cases where the merchant lacks advance knowledge of the claimed unreasonable risk. Sometimes, an accident is just an accident.

Medical Malpractice: Can failure to communicate test results be medical malpractice?

05.20.2020

The Louisiana Fourth Circuit Court of Appeal recently considered a medical malpractice case with an unusual set of facts. Rather than the standard medical malpractice case, where a patient argues that he was misdiagnosed and/or claims that the doctor made a mistake when administering medical treatment, in Dufreche v. Jeffery Wayne Coco, MD and Internal Medicine Specialists, Inc., 2020-CA-0030 (La. App. 4^th Cir.), the patient alleged that his doctor committed malpractice by failing to communicate test results.

In Dufreche, the patient showed signs of an HIV infection. He was tested twice before being treated by the infectious disease specialist. Both tests were negative. During his examination, the infectious disease doctor thought it was unlikely that the patient had HIV, but tested him anyway at the patient’s insistence. According to the patient, he was notified by the doctor that he would be provided the results upon receipt.

Unfortunately, the test results showed that the patient was HIV positive; however, he was not contacted. Fifteen months passed, during which the patient was unaware that he was HIV positive. Because he was not contacted, he assumed he was negative. When testing by another physician showed he was positive, the patient/plaintiff filed suit to recover damages allegedly suffered through a delay in treatment and psychological shock, including a claim for “emotional distress.”

To recover, the patient was required to establish: 1) the standard of care; 2) breach of that standard of care; and 3) that the breach caused his emotional distress. At trial, the doctor testified that he required his patients to follow up in person to receive test results, and expected the patients to contact his office to schedule an appointment. The court found that expecting a patient to follow up in person to receive sensitive test results was not a breach of the standard of care. However, the evidence established that the patient was not instructed that he must schedule an in-person appointment to obtain his test results.

The Dufreche court agreed with the lower court in finding that a failure to notify the patient of the doctor’s policy was a breach of the standard of care. Further, the court found that the infectious disease specialist, who admitted to a duty to the public to protect them from HIV, had also breached his duty for failing to notify an HIV positive patient of his diagnosis for over fifteen months. The doctor’s failure to communicate the results caused the patient’s emotional distress – resulting in an award of $45,000 in damages.

Erratic Driving and the Duty of Law Enforcement

11.05.2019

The Louisiana First Circuit Court of Appeal recently ruled on the duty of law enforcement and the potential for tort liability should that duty be breached. In Aaron L. Van Cleave and Christy Van Cleave v. Arthur Wayne Temple, et. al., 2018 CA 1353 (La. App. 1 Cir. 5/31/19), the appellate court considered the duty of law enforcement to the general public after the police receive a report of erratic driving.

Arthur Wayne Temple was driving a 2006 Ford F-250 truck in St. Helena Parish when he crossed the center line of Louisiana Highway 16 and struck a truck driven by Allen Marchand. Aaron Van Cleave was a passenger injured in the accident.

About an hour before the collision, June Blades was driving behind Temple, observed erratic driving, and called the police. In response, a sheriff’s deputy was dispatched to the area but could not locate the truck. Van Cleave sued a number of potentially liable parties. Aware that the police knew of the erratic driving before the accident, he included the sheriff’s department as a defendant. He argued that the sheriff’s department possessed a duty to locate the erratic driver before they cause harm.

Louisiana jurisprudence recognizes that the police have an affirmative duty to ensure that motorists are not subjected to an unreasonable risk of harm. But, the scope of that duty is based on the particular facts of the case and the relationships of the parties; and must be reasonable. In this case, the court found that the sheriff’s department acted reasonably by immediately dispatching an officer to attempt to locate the truck, even if they were unable to ultimately stop the accident.

Virginia “Jenny” McLin has experience handling cases from the initial client consultation to preparing a writ of certiorari to the United States Supreme Court. Her experience allows her to work with clients to develop a cost-effective litigation plan for each case. Recently, Jenny was on the defense team that prevailed in a workers’ compensation case involving a discovery-related issue that was upheld on appeal to the Louisiana Supreme Court. This had a state-wide effect on the handling of discovery in workers’ compensation matters.

Workers’ Compensation: A Recent Louisiana Decision Revisits a Fundamental Issue

04.16.2018

Historians call it “The Grand Bargain.” At its heart, the workers’ compensation law is a bargain, an exchange between the employer and the employee. In this bargain, the employee without having to prove his employer’s negligence receives the benefit of continued income and medical treatment. In return, the employer, even if it is at fault, receives protection from tort suits. However, for this bargain to apply, the accident must have occurred within the “course and scope” of employment. But the question of when an accident is considered to have occurred in the “course and scope” is not always as simple to answer as it might otherwise appear.

The issue of course and scope has been litigated many times, in many forums. The recent decision in Jackie Holden v. Mike’s Catfish Inn, Inc. and Massachusetts Bay Insurance Company, 2017 CA 1056 (La. App. 1 Cir. 2/27/18) explores course and scope in the context of an employee who was on break.

In Holden, the plaintiff was “clocked in” and on the premises of her employer. When her daughter called and asked to meet her outside, the plaintiff took an employer-sanctioned work break, walked outside, and fell on the steps, causing injury to her left knee. She filed a tort suit against her employer alleging negligence for failing to remove a foreign substance which allegedly caused her to fall. The employer sought to dismiss the suit under the contention that the plaintiff’s exclusive remedy for the fall was workers’ compensation.

The trial court dismissed the suit as barred by the employer’s workers’ compensation protections and plaintiff appealed. The sole issue before the appellate court was whether the plaintiff was in the course and scope. Plaintiff argued that she was on break and had left her designated work duties to speak with her daughter such that her activities at the time of the fall were not work-related. The employer countered that plaintiff remained on the clock during her break and was on the employer’s premises when she fell.

In assessing course and scope, courts consider the time of the accident, the place where the accident occurred, and the employee’s activities at the time of the accident. “An accident occurs in the course and scope of employment when the employee sustains an injury while actively engaged in the performance of her duties during work hours, either on the employer’s premises or at other places where employment activities take the employee.” Holden at p. 6, citing, McLin v. Industrial Specialty Contractors, Inc., 02-1539 (La. 7/2/03), 851 So. 2d 1135.

In ruling against the plaintiff, the Holden court colorfully concluded:

“An employee who is getting paid, is on her employer’s premises, and is on an approved work break is in the course and scope of her employment whether she is visiting her daughter, getting a breath of fresh air, smoking a cigarette, or walking outside to drink a diet coke.”

While workers’ compensation is a bargain, Holden reminds that it is a bargain workers will continue to try to escape.

Virginia “Jenny” McLin is a partner at Keogh Cox who practices in the fields of corporate litigation, insurance defense, and workers’ compensation defense. When she is not practicing law, Jenny can be found volunteering with the Junior League of Baton Rouge; cheering for the LSU Tigers with her husband, Ryan; or shuffling her two kids to and from dance practice.

When a Settlement Is Not a Settlement

06.01.2017

Louisiana law favors the settlement of disputes. With a settlement, both sides agree to avoid costly litigation and obtain a certain, negotiated result. While neither side is completely happy with the result in a typical settlement, the case is at least closed and the financial and emotional drain of litigation is ended. But the recent decision in The Marietta Trust and The Warren Trust v. J.R. Logging, Inc., Fair Hills Farm, LLC, Jerry Avants, Jr., Thomas Keaty, Jr. and XYZ Insurance Company, 2016 CA 1136 (La. App. 1 Cir. 5/11/17) shows what can happen when one of the parties change their mind. This case is important because it calls into question whether an exchange of emails is sufficient to reach a final settlement.

The Marietta Trust case involved a dispute regarding the wrongful cutting of timber and the parties seemingly came to a resolution. Via email, the case was negotiated and the terms were agreed upon. Formal settlement documents were drawn up and money was exchanged. However, when the time came to execute the final documents, one set of defendants refused to sign the paperwork. This refusal to sign came after the attorney for these defendants directly stated in an email that his “clients have agreed to the settlement.” Id. at *4. In response to the refusal to sign, the other parties filed a Joint Motion to Enforce Settlement Agreement which was denied by the Trial Court.

Settlement agreements are governed by the Louisiana Civil Code art. 3071 which provides that litigation can be resolved via settlement or compromise. A settlement agreement can take two forms: 1) recitation in open court; or 2) a writing. “The purpose of the writing requirement is to serve as proof of the agreement and the acquiescence therein.” Marietta Trust, 2016 CA 11336, Id. at *3. The writing must be signed by the parties or their agents. “Until the parties sign a written document or documents evincing their consent to the terms of the proposed agreement, a party is free to change his or her mind.” Id. at *3. Prior courts have found that emails meet the “writing” requirements. See, Geer v. BP America Production Co., 2014-450 (La. App. 3 Cir. 11/5/14), 150 So. 3d 621; Dozier v. Rhodus, 2008-1813 (La. App. 1 Cir. 5/5/09), 17 So. 3d 402.

The appellate court in Marietta Trust refused to enforce the “settlement.” The court found that the exchange of emails was insufficient to meet the “writing” requirement of Civil Code article 3071 because neither the emails nor any other evidence showed that the attorney possessed “the express consent necessary to accept the terms of the settlement.” Id. at *3.

When is a settlement not a settlement? Maybe when it came to you through your inbox. So, if an email from the attorney is not sufficient to perfect a settlement, what can we do? The answer offered by the 1st Circuit is to either: 1. Recite in open court; or 2. Obtain a writing that includes the client’s express consent given to the attorney to settle the case (presumably for the amount in the writing).

An Exercise in Inaction

09.09.2013

“I never worry about action, only inaction.”

– Winston Churchill

The Louisiana Supreme Court’s decision not to take up a case is sometimes just as important as a decision to grant Writs and issue a ruling. Recently, much attention has been given to the Court’s decision not to grant a Writ filed by Louisiana State University.

To Err is Human, To Rescind-Declined

08.22.2013

The Louisiana Supreme Court recently addressed the impact of contractual “errors” in Cynthia Fry Perionnet and Elizabeth Fry Franklin v. Matador Resources Company, 2012-2292, 2012-2377, — So. 3d –.

The Perionnet case involved a dispute over the intent of a contract to extend a mineral lease. The property owners believed that the lease was extended as to only 168.95 acres of nonproducing land. The defendant/lessors argued that the contract contemplated that the lease would extend to the entire 1850.34 acres to include producing wells. Plaintiffs/property owners argued that their unilateral error regarding the terms of the contract was ground for rescission. The jury ruled in favor of the defendant/lessors. The Court of Appeal reversed. The Supreme Court granted writs.

Impact of Supreme Court’s Recent “Open and Obvious” Ruling not Obvious

04.22.2013

The Louisiana Supreme Court recently issued a ruling on the application of the “open and obvious” doctrine in slip and fall cases. The facts of Broussard v. State of Louisiana, 2012-1238 (La. 4/5/13), presented problems for both sides. A UPS driver tripped and fell over an offset between the floor and an elevator. The elevator in a State building had problems for years. One problem was that the elevator would not align properly between floors causing an offset between the floor and the elevator. However, the UPS driver delivered products to this particular State building daily and was well aware of the problem. At the time of the incident, he noticed that the elevator was not properly aligned but nevertheless attempted to pull a dolly with approximately 300 pounds of computer paper over the offset. The inertia created caused the plaintiff to lose control. Plaintiff sued the State, the owner of the building, for injury to his back.

Sudden Shifts – Burden Shifting under Louisiana Law

04.11.2012

Winning or losing in court often comes down to who possesses the burden of proof. Like a driver at a four-way stop, a litigant has to know when it is their turn.

Civil Procedure Article 966, the “Summary Judgment Article,” provides that the mover bears the burden of proof. The Louisiana Supreme Court recently addressed this burden in Dan Veuleman & Jody Veuleman v. Mustang Homes, LLC, 2013-C-190 (La. 4/5/13), – So. 3d – in the context of insurance coverage.