Walking Drivers: A “Sudden” Defense to Rear-end Liability

Imagine you are visiting family during the holidays. As a favor, you take a family member’s vehicle to the gas station for a fill-up. While in transit, you get into an accident where you are at fault. Does your insurance policy provide coverage for the accident?

According to La. R.S. 22:1296.1, a new statute that went into effect on August 1, 2022, the answer to this question is “yes,” your insurance may afford coverage under these facts.

La. R.S. 22:1296.1 now requires insurance policies issued in Louisiana to provide coverage when the driver insured under the policy operates a non-owned vehicle with the express or implied permission of the vehicle’s owner. The statue was enacted to declare a new public policy regarding this issue and was passed in response to the Louisiana Supreme Court’s decision in Landry v. Progressive Security Insurance Company, 2021-00621 (La. 1/28/22), reh'g denied, 2021-00621 (La. 3/25/22); 338 So.3d 1162.

The Landry case involved a motor vehicle accident that occurred as the defendant-driver, as a favor to the vehicle’s owner, drove the vehicle to a tire shop to repair a tire. The plaintiffs brought an action against the defendant-driver, the driver’s insurer, and the insurer of the vehicle that he drove at the time of the collision.

The Louisiana Supreme Court upheld a provision in the driver’s policy that stated coverage under such circumstances was only available when the driver’s own vehicle was out of service. Because the driver’s vehicle was not out of service, no coverage was found under the driver’s policy. In so holding, the Landry court found that public policy did not require automobile insurance liability coverage for a driver’s negligent operation of a non-owned vehicle.

The Louisiana legislature enacted La. R.S. 22:1296.1 in response to the Landry decision. The statute provides that an insurer writing automobile liability, uninsured, underinsured, or medical payments coverage shall not exclude the benefits of such coverage under its policy to an insured operating a non-owned vehicle if all of the following requirements are satisfied:

• The coverage is in full force and effect.
• The insured is operating a vehicle owned by another with the express or implied permission of the vehicle’s owner.
• The non-owned vehicle that is being operated by the insured is not provided, furnished, or available to the insured on a regular basis.

The statute also provides this coverage is secondary to the vehicle owner's insurance policy. Furthermore, if the coverage provided under the statute is included within the coverage provided pursuant to La. R.S. 22:1296, which addresses coverage for temporary, substitute, and rental vehicles, the provisions of La. R.S. 22:1296 determine which coverage is primary. (For additional information regarding La. R.S. 22:1296 click here.) [Sophia, please include link to blog from 5/25/22].

Let’s return to real life scenarios like those we addressed above. Perhaps you are blocked in at a party, so a friend tosses you the keys to move their car, or, like the situation in Landry, maybe you are trying to do a good deed by driving your parents’ car to a gas station for a fill-up when an accident occurs. While it remains to be seen how courts will interpret this statute in these circumstances, under the new legislation, these actions may now implicate coverage under your insurance policy.

Case Reference: Landry v. Progressive Security Insurance Company, 2021-00621 (La. 1/28/22), reh'g denied, 2021-00621 (La. 3/25/22); 338 So.3d 1162.

In Reynolds v. Bordelon, 2014-2362 (La. 6/30/15), — So.3d—, 2015 WL 3972370, the Louisiana Supreme Court definitively ruled that Louisiana law does not recognize a cause of action for negligent spoliation of evidence. This resolved a disputed issue of Louisiana law.

The Reynolds plaintiff was involved in a multi-car accident in which his airbag failed to deploy. His insurance company paid what was owed for the totaled vehicle under its policy and, in the normal course of business, disposed of the vehicle by auctioning it to a salvage yard. Plaintiff’s petition included a claim against the auto manufacturer for the airbag failure. It also included a claim against his insurance company and the salvage yard for failure to preserve the vehicle as evidence likely to be used in litigation.

The Supreme Court classified the insurer and salvage yard as "third parties" to the lawsuit and categorized the plaintiff's claims against them as a negligent spoliation theory. In rejecting these third-party claims, the Court declared a claim for negligent spoliation to be against Louisiana public policy.

First, the tort would not deter future conduct, but would instead penalize a party unaware of potential wrongdoing. Second, liability for such a tort would be based upon great speculation regarding the value of the evidence at issue. Lastly, it would create unnecessary litigation and place a substantial burden upon society as a whole because third parties not even aware of litigation would be required to adopt cumbersome retention policies to reduce exposure to liability.

To prevent spoliation of evidence by third parties, a plaintiff who anticipates litigation should instead enter into an agreement with the third party or obtain a court order to preserve the evidence. By doing so, the plaintiff preserves a potential breach of contract claim regarding the evidence or can seek remedies for violation of the court order in the event the evidence is lost or destroyed.

Under Reynolds, the plaintiff cannot assert a claim for negligent spoliation of evidence. However, the Court confirmed that discovery sanctions and criminal sanctions remain viable against “first parties” who intentionally destroy evidence, Further, third parties may still be liable if a plaintiff can demonstrate a breach of a contract to preserve the evidence.

During week seven of the 2025 Regular Session, Louisiana Governor Jeff Landry signed the following bills into law:

HB450 legislatively overrules Housley v. Cerise, 579 So. 2d 973 (La. 1991) (which provided a presumption of medical causation where plaintiff had no pre-existing history) and became effective upon signature by the governor. The Act has prospective application only and shall not apply to causes of action arising prior to the effective date.

HB434 modifies “No Pay/No Play” and bars uninsured motorists from recovering for the first $100,000.00 of bodily injury and the first $100,000.00 of property damage based on any cause or right of action arising out of an automobile accident. The Act allows for an uninsured motorist, who institutes an action to recover damages, regardless of fault, and is awarded an amount equal to or less than $100,000.00, to be held liable for all court costs incurred by all parties to the action. The Act’s effective date is August 1, 2025.

HB436 bars unauthorized aliens from recovering general damages and past and future wages for damages arising from an automobile accident. The Act does not apply to a claim made against an uninsured or underinsured motorist policy which names the unauthorized alien as an insured. The Act’s effective date is August 1, 2025.

HB431 provides for modified comparative fault and bars claimants, who are found greater than or equal to 51% at fault, from recovering for damages. If fault attributable to the claimant is less than 51%, the amount recoverable shall be reduced in proportion to the fault attributable to the claimant. The bill does not say whether this applies only to auto claims. We expect this will be clarified. The Act’s effective date is January 1, 2026.

HB549 requires a premium discount for policyholders of commercial motor vehicles with installed dashboard cameras and telematic systems and who meet the other requirements enumerated in the Act. The Act’s effective date is January 1, 2026.

HB148 requires insurance companies to display prior premium amounts in close proximity to the renewal premium. The Act also provides for rate filing standards and methods and changes the process by which the insurance commissioner can disapprove a rate if he determines it is excessive, inadequate or unfairly discriminatory. The Act’s effective date is August 1, 2025.