When Filing A Lawsuit By Fax, FedEx Is Your Friend

In Madden v. Fairburn, the plaintiff amended her petition to assert a UM claim against an insurer based upon the alleged negligence of a new defendant not named in the original petition. The amended petition asserted a new theory of liability but sought the same recovery under the same UM policy.

The issue presented to the Louisiana Court of Appeal for the First Circuit was whether the original petition interrupted prescription for the claim brought against the UM insurer. Because the insurer did not receive notice in the original petition that it could be liable for damages based upon the new defendant’s fault, the court found prescription could not be interrupted.

Madden was a passenger in a vehicle driven by John Seibert that collided with Steven Ray Fairburn. Madden timely filed suit against Fairburn and Capitol Specialty Insurance Corporation (Capitol Specialty), claiming uninsured motorist (UM) coverage under its policy. The Trial Court later dismissed Madden’s claims against Fairburn. While the appeal of that ruling was pending, and over five years after the accident, Madden amended her petition to allege Seibert was at fault and sought the same UM coverage any damages he caused. Capitol Specialty argued the claim brought against it in the amended petition had prescribed.

At the time of the accident, claims for torts/delictual actions had a one-year prescriptive period that commenced from the date of the injury or damage sustained* Claims to recover damages under a UM policy are subject to a prescription period of two years.^ Madden argued her original claim against Capitol Specialty interrupted prescription because her amended claim arose from the same accident and sought to recover damages under the same UM policy.

La. C.C. art. 3462 states that prescription is interrupted when an obligee (Madden) commences an action against an obligor (Capitol Specialty) in a court of competent jurisdiction and venue. However, in Kling v. Hebert, the Louisiana Supreme Court has clarified that the “essence of interruption of prescription by suit is notice to the defendant of the legal proceedings based on the claim involved.” The Kling judges emphasized that prescription serves to protect defendants from unexpected liability years after an event, particularly when a new legal theory or a different alleged tortfeasor is introduced.

The court also considered Trahan v. Liberty Mutual Insurance Company, which held that a claim against an insurer based on one party’s negligence does not interrupt prescription for a later claim against the same insurer based on another party’s negligence. Because Madden’s original suit was based on Fairburn’s negligence, Capitol Specialty did not receive timely notice that she would later seek UM coverage based on Seibert’s alleged fault. Thus, the appellate court ruled in favor of the insurer, affirming the prescription of the plaintiff’s claims.

References:

Madden v. Fairburn, 2024-0513 (La. App. 1 Cir. 12/27/24), --- So.3d ---, 2024 WL 5232995.

Kling v. Hebert, 23- 00257, p. 4 (La. 1/ 26/24), 378 So. 3d 54.

Trahan v. Liberty Mutual Insurance Company, 314 So. 2d 350 (La. 1975).

*La. C.C. art. 3492. See As of July 1, 2024, delictual actions are subject to a two-year liberative prescriptive period, applying to delictual actions that arose or after the effective date.

^ La. R.S. 9:5629.

“Prescription” is the timeperiod in which a litigant must file suit, or the action is barred. Oneof the first lessons a Louisiana law student learns is the importance ofdetermining the prescriptive period of a cause of action. Filing a causeof action too late is fatal. A recent decision from the Louisiana FifthCircuit Court of Appeal reads like a law school exam and illustrates thatdetermining which prescriptive period applies is sometimes the key to the case.

In DeFelice v. FederatedNat'l Ins. Co., 18-374 (La. App. 5 Cir. 7/9/19), mold was discovered inplaintiff’s home on June 10, 2016. Plaintiffs notified their insurancecompany, who hired a mold remediation company to inspect the home. Whenthe home was inspected on June 22, 2016, the inspector verbally informedplaintiffs that the home was safe. On the same day, a separate moldinspector collected samples. The second mold inspector issued a report on June23, 2016 advising that mold remediation may be necessary. This reportspecifically stated that “certain mold and mold spores in buildings and housingcan result in mild to severe health effects in humans and can deteriorate thestructure of the dwelling resulting in content or structure damage.” Thesecond report was provided to the plaintiffs.

Plaintiffs continued to live inthe home. In August of 2016, plaintiffs’ infant son was born. Shortly thereafter, the infant began to experience breathing issues and wasdiagnosed with a lung condition by December of 2016. Plaintiffs vacatedthe premises in January of 2017.

More than one year after receiptof the second mold report, plaintiffs filed suit on July 24, 2017 against theirinsurer and the inspector who advised that the home had no mold problems. Plaintiffs raised claims for property damage, damage to the health of theparents, damage to the health of the minor child, and consortium claims onbehalf of the parents for the damage to the minor child.

The DeFelice court foundthat prescription began to run on June 23, 2016 with regard to the parents’individual and property damage claims. Because suit was not filed withina year of the second mold report advising of possible health and propertydamages, the parents’ individual health claims and the claims for propertydamage were prescribed under the one-year period set by Civil Code article3492.

The minor child was not bornwhen the report was issued on June 23, 2016. Plaintiffs argued that thoseclaims were brought within a year of the child’s birth, and were thereforetimely. The DeFelice court agreed and held that prescription could notbegan to run until the child was born. While Louisiana law provides that a childis a “person” upon conception, this “legal fiction” applies only to protect theinterests of the child. The court reasoned that a finding that prescriptioncommenced prior to birth would not “protect the interests” of the child. While the parent’s claims were prescribed, the claim filed on behalf of theinfant, and any claims that the parents had related to their infant’s healthcondition, were timely.

The court's analysis inDeFelice reminds that determining which prescriptive period applies to whichclaim is often the most important issue.

In a previous blog, we outlined developing law in the Louisiana appeals courts, and federal district courts in Louisiana on the issue of whether a claimant may maintain a separate cause of action against an employer for independent negligence when it is stipulated that the employee was in the course and scope of employment.¹ Most courts held a claimant could not maintain a separate action against the employer under these circumstances, reasoning that the employee’s fault would impute to the employer, and therefore, additional inquiry was not appropriate. However, the Louisiana Supreme Court recently addressed the issue and stated:

“(A) plaintiff may pursue both a negligence cause of action against an employee for which the employer is vicariously liable and a direct claim against the employer for its own negligence in hiring, supervision, training, and retention as well as a negligent entrustment claim, when the employer stipulates that the employee was in the course and scope of employment at the time of the injury.” (Emphasis added) See Martin v. Thomas et al., 21-1490 (La. 12/21/21), 328 So. 3d 1164.

This holding notably overturned the 1^st Circuit Court of Appeal ruling in Elee v. White, - - So.3d - - (La. App. 1 Cir 7/24/20), 2020 WL 4251974 and other Louisiana 5^th Circuit Court of Appeals decisions. The Supreme Court in Martin reasoned that “the initial assessment of fault required by the law is not bypassed due to the employer-employee relationship” and “shielding a potential tortfeasor from liability is not compatible with a comparative negligence regime.” The Court further stated that the possibility that both the employee and employer may be at fault is not “subsumed” by the employer’s admission on course and scope. In fact, if the fault of the employee is shown, then the issue of whether there is also fault on the part of the employer remains and must be decided by the evidence on a case-by-case basis.

The consequences of this decision remain to be seen, but it is expected that claimants may also pursue employers separately on theories such as negligent hiring, supervision, and entrustment. The scope of such discovery will remain within the sound discretion of the trial judge.

By: John P. Wolff, III and Richard W. Wolff

¹Louisiana Appeal Courts Prohibit Direct Negligence Claims Against Employer; US District Court Uses Rule to Limit Discovery - Keogh Cox