The Louisiana Supreme Court rules that amount billed by healthcare providers beyond what has been paid by a Workers Compensation insurer is NOT a collateral source that is recoverable against tort defendants

A rear-end collision is a unique animal in the law. Plaintiff’s attorneys seek them out, and insurance companies fear them­­--sometimes for good reason. The "rear-end" accident is unique because proof of the mere fact that one vehicle strikes the rear of another creates a strong legal presumption of fault under La. R.S. 32:81. While this presumption is formidable, it may be overcome.

The rear-end presumption is premised upon the duty to not follow too closely and the law will assume that the following driver breached this duty when there is impact. However, the following driver can escape liability if he shows that his vehicle was under control, that he followed at a safe distance, and that the lead driver negligently created a hazard which could not have reasonably been avoided. For instance, if it is shown that the reckless or unpredictable driving of the lead motorist created a sudden emergency, the following driver will not be at fault. Brewer v. J.B. Hunt Transport, Inc., 35 So.3d 230 (La. 2010). Once established, the sudden emergency defense trumps the “rear-end presumption.”A "sudden emergency" is created when a driver is placed in a position of imminent peril that he or she did not create through their own conduct. Hickman v. Southern Pacific Transport Company, 262 So.2d 385 (La. 1972). When a driver can demonstrate the existence of a sudden emergency, they are not negligent for failing to do what a reasonable person might have done to avoid the accident had they been given enough time to assess and react to the situation.In Jewitt v. Alvarez, 179 So.3d 645 (La. App. 2 Cir. 9/30/15), a following driver who rear-ended the vehicle of the lead driver was free from fault as a result of the sudden emergency defense where the facts revealed that the accident was solely caused by the slow speed of the lead driver (who almost came to a complete stop on the interstate) and the presence of surrounding traffic prevented the following vehicle from taking evasive action.In Carias v. Loren, 2015 WL 1019481 (La.App. 1 Cir. 3/9/15), an eighteen-wheeler was traveling in the middle lane of the interstate when a "phantom driver" moved without warning from the left lane to the middle lane and slammed on its brakes in front of the eighteen-wheeler. In attempt to avoid the collision, the driver of the eighteen-wheeler swerved to his right and impacted a vehicle which then struck the plaintiff's vehicle. The driver of the eighteen-wheeler invoked the sudden emergency defense; the court agreed and found the defendant-driver free from fault.Rear-end collisions are hard to defend, but a defendant may want to gather a clear understanding of all of the facts before accepting liability. If these facts support the sudden emergency defense, the driver may "walk."

The Louisiana legislature recently enacted laws that set new prescription periods for most delictual/tort actions and claims for damage caused to immovable property. Civil Code articles 3492 and 3493 previously established a prescription period of one year for these types of claims. The legislature repealed these articles and enacted Louisiana Code Articles 3493.1 and 3493.2 in their place.

Louisiana Code Article 3493.1 now establishes a prescriptive period of two (2) years for delictual actions/tort claims that runs from the day injury occurred or damage is sustained. It contains language previously included in Louisiana Civil Code Article 3492, which states that prescriptive period does not run against minors or interdicts in actions involving permanent disability and brought pursuant to the Louisiana Products Liability Act or state law governing product liability actions in effect at the time of the injury or damage.

Louisiana Civil Code Article 3493.2 also establishes a prescriptive period of two (2) years when damage is caused to immovable property. This prescriptive period runs from the day the owner of the immovable acquired, or should have acquired, knowledge of the damage.

These changes went into effect of July 1, 2024. Louisiana Civil Code Articles 3493.1 and 3493.2 apply prospectively only and apply to delictual actions arising after July 1, 2024.

The Louisiana Supreme Court recently held that a claim for defense and indemnity may be asserted before a judicial finding of liability. The Court’s decision overruled prior decisions that held claims for defense and indemnity were premature until it was determined that damages were actually owed and the party claiming indemnity sustained a loss.

In Daniel Bennett v. Demco Energy Services, the plaintiff alleged he was injured when he drove over a downed power line that belonged to Cox Communications. Evidence showed Cox Communications contracted with Cable Man to provide services, maintenance, and repair for its telecommunication companies. The contract covered maintenance and repair of the subject phone line.

The contract included an indemnification provision that required Cable Man to indemnify and defend Cox Communications from any and all claims relating to Cable Man’s work, Pursuant to the contract, Cox Communications sent Cable Man a request to tender defense and indemnification under the contract. Cable Man refused the tender and Cox Communications filed a cross-claim against Cable Man asserting that it was owed defense and indemnification. In response, Cable Man filed an Exception of Prematurity and maintained that the claim for indemnity had not accrued because there had not been a judgment or a finding a Cable Man’s fault or liability.

The Louisiana First Circuit Court of Appeals granted the Exception of Prematurity and stated that “It is well-established that claims for indemnity, as well as claims for defense arising under an indemnity agreement, are premature prior to a determination that damages are actually owed and the indemnitee sustains a loss.” The court reasoned that the lawsuit was still pending against both parties and no liability determination had been made. Therefore, under the “well-established” law, Cable Man owed no obligation to Cox Communications for indemnity and costs at the time Cox asserted its cross-claim.

However, the Louisiana Supreme Court reversed the First Circuit’s decision and Cable Man’s claims of prematurity were denied. Acknowledging such claims for indemnification previously were considered premature, the Court held the law moving forward should allow for a claim for indemnity, whether in a third-party demand or a cross-claim, that is raised during the course of litigation and before a finding of liability. Further, the Court recognized potential inconsistencies with prior judicial determinations and stated, “in light of our ruling today, to the extent any prior jurisprudence can be interpreted otherwise, we now clarify that such a claim for indemnity is not prohibited before a liability adjudication.”

This ruling makes clear that “asserting a claim for indemnity, arising out of the same facts and circumstances, is not premature before a judicial finding of liability.” The right to collect on an indemnity agreement continues to be determined upon a finding of liability or loss, but a claim for indemnity can now be asserted in the same proceeding.

References:

Daniel Bennett v. Demco Energy Services, et al, 2023-CC-01358 (La. 5/10/24); 386 So.3d 270.