Articles Posted in Negligence Claims

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In a suit by a commercial tenant and their insurance company against the landlord, Mr. Ducet, the landlord defended by arguing that the terms of the lease prevented the tenant from recovering damages. If the tenant was unable to recover damages the insurance company would also be unable to recover under the legal concept of subrogation.

The lease clause in question was called a mutual waiver. In it the parties agreed not to bring claims against each other for damages as a result of a fire if the damages were or could have been insured against under a typical fire insurance policy. The lease also stated that the landlord and the renter would each get a waiver of subrogation from their respective insurance underwriters. Subrogation is when an insurance company pays their policy holder the cost to repair or replace the damaged property but then sues the person who caused the damage or is otherwise legally responsible for it to get the money back from them. The Court found that the waiver in the lease prevented the tenant’s insurance company from suing the landlord for the amount the company had paid the tenant for damaged personal property and equipment. The Court stated that the insurance company, as subrogee, had no greater rights than the tenant. Under the mutual waiver provision in the lease agreement the tenant had no right to sue the landlord for the cost of personal property or equipment lost in a fire, therefore the insurance company could have no right to sue either.

Another issue in the case was how the mutual waiver affected other responsibilities under the contract. The tenant arranged to have the roof repaired after the fire even though under the terms of the lease the landlord was responsible for repairing any damage done to the building itself as a result of a fire. The Court found that the landlord had a duty under the contract to keep the building itself in good repair and that it was his responsibility to repair the roof after the fire. The fact that the tenant hired someone to fix the roof before the landlord had done it did not relieve the landlord of his obligation. The mutual waiver clause in the lease did not prevent the repair company from suing the landlord for the cost of the repairs which were the landlord’s responsibility.

This case shows how previous contracts, such as a lease, can affect later contracts, like fire insurance policies, even when they are made with third parties. It is important for every property owner and renter to understand how their contracts affect their rights and obligations in regard to their property. This is equally important for business owners as for people dealing with their own homes.

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Along with a much-needed economic boom, the recent shale frenzy in northwestern Louisiana has brought the typical controversy. Accidents and spills have raised environmental concerns and caused some to question whether the new jobs are safe. For one Caddo Parish couple, however, the shale boom has brought a very unique set of concerns—from whom should one accept legal advice?

Chesapeake Louisiana, L.P. held a mineral lease on the Stockmans’ property which was set to expire on July 14, 2008. The Stockmans desired to continue leasing the property, so in April they signed an extension of the lease. A month later, they were solicited by an agent of Petrohawk Properties, L.P., a competing mineral producer. The Stockmans informed the Petrohawk agent that they had already leased the property to Chesapeake. This, however, did not deter the Petrohawk agent.

The Petrohawk agent explained that “Louisiana is a race state” and “if Petrohawk recorded its lease first, the Chesapeake extension would be invalid.” It is true that in a “race” state, the first party to the courthouse to record the lease is said to have put the entire world on notice of the lease. That party’s lease then takes precedence over any subsequent lease on that property, even if the subsequent lease was signed first. While this may seem silly at first, the “race” concept reflects a basic preference the law makes for certainty. Recording provides a far more objective measure by which parties may determine priority and, indeed, this entire dispute could have been avoided if Chesapeake had simply recorded its extension immediately after signing.

On the other hand, while this statement may have been loosely true with respect to Petrohawk, it was highly misleading with respect to the Stockmans. Although the Petrohawk lease, if filed first, would trump the Chesapeake lease, it would nevertheless render the Stockmans liable for breach of the Chesapeake lease, in violation of the most fundamental principle of property law—that one may not sell what he does not own.

Unfortunately, tempted by the prospect of higher lease payments, the Stockmans took Petrohawk’s misguided advice without professional legal counsel. Instead Mr. Stockman only confirmed that Louisiana was indeed a “race” state and spoke with his neighbor, a geologist. His neighbor advised him to strike the warranty of title from the Petrohawk lease, an act which did nothing to relieve the Stockmans of their duties to Chesapeake. Upon learning of the Petrohawk lease, Chesapeake immediately slapped the Stockmans with a breach of contract suit.

Undoubtedly furious over having been lied to, the Stockmans filed a claim against Petrohawk for fraud. In Louisiana, a fraud claim has three elements: first, a “misrepresentation, suppression, or omission of true information”; second, the “intent to obtain an unjust advantage or cause damage or inconvenience to another”; and third, “that the error induced by the fraudulent act relates to a circumstance that substantially influenced the victim’s consent to the contract.”

The Stockmans claim rested on the notion that Petrohawk told them a half-truth. In stating that Petrohawk’s winning the race to the courthouse would “invalidate” the Chesapeake lease, Petrohawk assumed a duty to disclose to the Stockmans the rest of the truth. By only telling the Stockmans as much as they did, however, Petrohawk led them to believe they would not be in breach of their existing contract. This omission, the court held, amounted to fraud.

While the Stockmans eventually got out of their legal problems, they only did so at the expense of considerable time and resources. Real property law presents many complications and pitfalls for the ordinary layperson, the nuances of which should be explained by competent legal counsel. Avoid the hassle.

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As is often the case, an accident between two vehicles can subsequently involve further vehicles not initially involved in the initial rear-ending accident. The driver of the subsequent vehicle which becomes involved in an accident after the initial crash may be unsure whether they are for damages caused by their own involvement or are able to make a claim for their own damages suffered. The possibility of being responsible or owed for damages in a multiple vehicle accident almost always depends on the circumstances surrounding the driver of the following car involved in the collision after the initial accident.

It is generally presumed under the law the vehicle following other vehicles involved in an accident will be at fault for the resulting accident when it collides with the initial collided vehicles. However, a driver can avoid this presumption of liability if it is shown they were following at a safe distance under the circumstances, their vehicle was under control, and they were closely observing the vehicle ahead of them. There is an additional method of proving no fault for liability referred to as the sudden emergency doctrine. A following driver may be absolved of liability under the sudden emergency doctrine if it is demonstrated the lead driver negligently created a hazard which could not reasonably be avoided. A court is going to look at the circumstances from which the emergency arose and determine whether the person in the position of imminent peril had sufficient time to consider and weigh all circumstances or the best means to adopt to avoid the impending danger of the emergency.

A recent case before the Second Circuit Court of Appeal of Louisiana, King v. State Farm Insurance Co., succinctly demonstrates the applicability of the sudden emergency doctrine in absolving the following driver from complete liability while awarding the following driver damages for injuries incurred. In this case, Ms. King was following a vehicle which struck another vehicle from the rear. Ms. King then swerved onto the shoulder to avoid the accident. Unfortunately, at the same time Ms. King swerved, the vehicle in front of her bounced to the side of the collision directly into Ms. King’s path on the shoulder where she impacted it. The court looked favorably upon the facts that Ms. King had been traveling beneath the speed limit, was observing the car in front of her, and was at a relatively reasonable behind the lead car. The court found that in addition to this the lead driver had created the emergency situation through his own collision, and Mrs. King had taken reasonable precautions by braking, and steering away from the accident. Despite her precautions, the unexpected turning of the vehicle into her emergency path was something she could not have sufficiently avoided in time. Hence, the court found the lead driver had created a hazard resulting in a Ms. King facing a sudden emergency. The court found the lead driver 100% at fault for the damages and injuries Ms. King suffered as a result of the lead driver’s original collision.

In a case involving liability of parties, the court must assess the relative fault of each of the parties. A following driver will not be responsible for liability under the sudden emergency doctrine, unless their actions caused the emergency. In the example case above, the lead driver was found to have created the emergency, and thus Ms. King was at no fault in the subsequent collision. The Court of Appeal of Louisiana held that the trial court had correctly awarded Ms. King for the damages and injuries she had suffered as a result of the accident.

If you believe you have a claim arising from a multiple vehicle accident, contact the Berniard Law Firm. Providing the best experts in liability and assessing accident claims, our law firm is fully capable of meeting your litigation needs.

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In this auto-related blog post, plaintiff Fartima Hawkins seeks to recover damages resulting from a February 5, 2008, automobile accident in Baton Rouge Louisiana. The accident occurred when Ms. Hawkins’ vehicle was broadsided by a government vehicle being driven by Sergeant Sean Fowler, a recruiter for the United States Army. Ms. Hawkins filed suit naming, among others, Sergeant Fowler and his personal liability insurer, Allstate, as defendants

After Hawkins filed suit against them, Allstate filed a motion for summary judgment, alleging that the policy issued to Fowler excluded coverage for the accident. Allstate claimed Fowler lacked permission to use the government vehicle for commuting purposes or, alternatively, because Fowler used the vehicle for his regular use insofar as he drove it back and forth from his home in Baton Rouge to his office in Covington each day. Allstate further asserted that its policy did not afford coverage under either circumstance and summary judgment was therefore appropriate.

The trial granted Allstate summary judgment reasoning that whether Mr. Fowler had implied permission or not, it either falls within the regular use exclusion because back and forth to work every day is regular use or alternatively falls within the lack of permission exclusion. Plaintiff subsequently filed a Motion for New Trial and/or Reconsideration which was denied by the trial court.

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What is vicarious liability? Vicarious liability, simply put, is the common law principle that an employer may be liable for its employee’s negligence if that employee’s negligence occurred within the course or scope of his or her employment.

In the Beech v. Hercules Drilling Company, L.L.C., case coming out of the Eastern District of Louisiana, vicarious liability principles came into play. In this case, certain bizarre events led the United States Court of Appeals for the Fifth Circuit to make a ruling as to whether Hercules Drilling Company should be held vicariously liable for the actions of Michael Cosenza, its employee, who accidentally shot and killed his co-worker, Keith Beech, while both were aboard a Hercules owned vessel.

The facts of the case were not in dispute. Beech was a crane operator aboard a jack-up drilling rig that Hercules owned, while Cosenza was a driller aboard the vessel. On December 13, 2009, the fateful events that led to the aforementioned case, took place. Cosenza happened to own a firearm, which he accidentally took aboard the vessel; Hercules policy prohibited any firearms from being aboard their vessels. Not only did Cosenza bring a firearm aboard the vessel, violating the policy, but when he realized that he had inadvertently brought it aboard (he found it among his laundry) he did not inform anyone about it and placed it in his locker, further violating Hercules policy. Cosenza was aware of the policies regarding firearms.

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Vehicle collisions are difficult in of themselves but when they involve an insurance dispute, they can be considerably daunting. One recent case involving an accident in dispute helps illustrate this further. In this case, Broussard and Brandy Oppenheimer live together with a child, but are unmarried. Broussard was driving Oppenheimer’s vehicle when he was rear-ended by an uninsured driver. While the pair maintained unisured motorist coverage through their insurance policies, which is suppose to cover them in these types of situations. However, the insurance company saw otherwise.

Farm Bureau denied Broussard’s request, stating that “the policy did not cover the accident in that Broussard was operating a vehicle that was not listed in the policy.” The insurer filed a motion of summary judgment on the issue of coverage, while Broussard filed a cross motion summary judgment to recover under his policy. The Appellate court cited Schroeder v. Board of Supervisors of Louisiana State University to define summary judgment, which states that a motion for summary judgment should be granted “if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to material fact, and that mover is entitled to judgment as a matter of law.”

The trial court reasoned that by allowing Farm Bureau “to exclude coverage would allow…a policy in derogation of La.R.S. 22:1295.” The statute explains that the policy should provide coverage to “an injured party while occupying and automobile not owned by said injured party.” Farm Bureau appealed the trial court’s decision to grant Michael Broussard’s motion for summary judgment. The granted motion for summary judgment declared Broussard was entitled to coverage under his uninsured motorist clause in his insurance policy.

To counter, Farm Bureau cited policy language claiming the insuring policy does not apply:

This insuring policy does not apply: (1) to any automobile owned by or furnished for the regular use to either the named insured or a member of the same household.

And;

This policy does not apply: (g) Under division 1 of coverage to bodily injury to the insured, his spouse or members of household sustained while in or entering into or alighting from an automobile owned by the insured, his spouse, or members of the household except the one described in the declarations.

The trial court and the Appellate court both agreed and affirmed that “policy language cannot change the requirements of the statute.” The law would allow the exclusion of coverage if involving a spouse or relative’s policies, but is not the situation here as Broussard and Oppenheimer are not married or related. Farm Bureau’s attempt to push the limits of its restrictions were unsuccessful, however, resulting in the judgment in favor of Broussard.

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In a recent case, a federal appeals court ruled on a longshoreman’s right to recover for injuries sustained when a pile-driving hammer unexpectedly released from a crane and fell on him. His employer had leased the crane from another company in order to perform restoration work on the docks and bulkheads at the Turtle Cove Research Center near Manchac. Luckily, both companies carried insurance. Unfortunately, both insurers quickly pointed the finger at each other.

Such situations occur frequently when contracting parties in large projects require multiple insurance policies to cover the myriad situations which could give rise to liability. The most important question from the victim’s perspective, however, is simply how and when he or she will be compensated.

When such finger-pointing occurs, the task devolves upon the courts to “rank” the policies. The longshoreman’s case, Deville v. Conmaco/Rector L.P., involved competing claims of three insurance companies. The crane owner carried general liability insurance and the employer carried an “excess” insurance policy — a policy which kicks in only after coverage limits have been reached on other applicable policies. In addition to these policies, however, the crane lease itself required the employer to obtain a third policy to cover its use of the crane.

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After a man was seriously injured in a one-car accident in Lafayette Parish, Louisiana, and rendered disabled to the point that he was no longer able to complete his job, he began to receive short term disability benefits from his employer. After those benefits expired, the man filed a claim for long term disability benefits. However, this claim was denied by the provider. The company’s policy with regard to long term disability benefits expressly prohibits the coverage of losses that are due to illegal acts. In this case, the man involved in the accident was reported to have had a blood alcohol level of 0.15, almost twice the legal limit in Louisiana, at the time of the accident.

Once his claim was denied, the man requested an appeal, claiming that the insurance company could not deny him coverage under the clause regarding illegal acts. The man provided several reasons why his act of driving under the influence should not be included in this clause: the policy did not include a specific “intoxication” provision; driving under the influence did not constitute an illegal act; even if it was an illegal act, the company could not prove that the accident happened because of his intoxication. At the time of the accident, two cars were racing towards him, and he had to swerve to miss them. The man claims that this was the real reason for the accident and that it had nothing to do with his intoxication.

In response to the man’s claims, the policy provider underwent an intensive investigation to determine whether or not it should grant the injured man’s long term disability claims. As part of the investigation, they found that the man’s blood alcohol level would have impaired his reflexes and reaction time at the time of the accident. Furthermore, by this time the man was indicted and given a DUI. Because of the DUI, medical records, and an export report that stated that the intoxication and resulting impairment contributed to the accident, the policy provider once again denied the man’s claims for coverage.

At this time, the man brought his claim against the policy provider to court. The trial court actually sided with the injured man, granting his motion for summary judgment with regard to coverage because it agreed that applying the “illegal acts” clause to the man’s case was unjust. Naturally, the policy provider appealed the case, claiming that the trial court had erred in reaching its decision. Specifically, the policy provider claimed that the trial court had abused its discretion in reaching its decision.

If the policy provider had the authority to interpret the terms of the policy and determine the individual’s eligibility for benefits, then the abuse of discretion standard would be the proper standard to employ. Under the “abuse of discretion” standard, the trial court or any other court reviewing the choices made by the policy provider should uphold the company’s decisions unless the person bringing claim against the company can prove that the company’s decisions were arbitrary. While the man argues that this is not the appropriate standard to use, the appellate court agrees that the policy expressly gave the policy provider the right to make all determinations with regard to eligibility for benefits.

So, now the court must simply decide whether or not this determination to deny the man’s claims was capricious or not. According to relevant case law, under the abuse of discretion standard, as long as the policy provider’s decision was supported by substantial evidence and was neither arbitrary nor capricious, then deference should be given to that decision. After reviewing the evidence, the court agreed that the policy provider interpreted the policy reasonably and that there was substantial evidence for the policy provider to deny the man’s claim. Because of this finding, the appellate court ultimately reversed the trial court’s judgment regarding the policy provider’s denial of coverage and remanded the case back to the trial court for further proceedings.

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Each type of lawsuit has a prescription period that explains that a plaintiff must file suit before a certain amount of time. Often, the period depends on the seriousness of the crime or certain facts of the crime, such as whether the injury was intentional or just a grave mistake. The prescription period encourages plaintiffs to file suit right away while the evidence and memories are fresh. In addition, it also allows the party that could potentially be sued to not have to wait around in fear of being sued for wrongdoing.

A case appealed to the Fourth Circuit for the State of Louisiana from Orleans Parish explains the prescription period for a number of potential causes of action. In that case, an individual sought the help of a lawyer for tax and investment purposes. She allowed the lawyer to be in charge of her trust account; however, he made several “loans” to friends from her trust account and charged her fees that she was unaware would be charged. As a result, she initially settled with the lawyer when she found out about the fees, but that settlement did not address the “loans.”

The investor, plaintiff, claimed that she did not fully understand that the lawyer was making loans until the lawyer was indicted by the Grand Jury regarding investment fraud and various other claims. However, she did ask for an accounting statement in 2003, which listed all of the loans that the lawyer made from her account. Additionally, the lawyer worked for Bank One, which the plaintiff was also aware of in 2003. Therefore, plaintiff sued both Bank One, and the lawyer, among others.

Initially, the lower court barred the plaintiff’s claim because the prescription period had already run. However, the Fourth Circuit Court of Appeals for the State of Louisiana explained that the court should consider each prescription period for each individual claim. This is necessary because the prescription period often varies by the type of claim. Therefore, the Court walked through each of her eight claims to determine whether the claim would apply and what the prescription period should be.

First, plaintiff argued a violation under the Louisiana Racketeering Act under La. R.S. 15:1351-56. The Court determined that the Racketeering Act had a prescription period of one year. Then, plaintiff argued unjust enrichment, that is, the bank profited from the lawyer’s wrongdoing. However, the Court pointed it out that this claim can only apply if there are no other claims that the plaintiff can use, even if those other claims are barred by the prescription period. Therefore, the Court did not determine a prescription period for unjust enrichment because the plaintiff could not use it regardless of the prescription period. Third, plaintiff argued breach of fiduciary duty and breach of contract, which has a one-year prescription period.

Fourth, plaintiff argued that the lawyer committed fraud. There is a longer prescription period for deliberate fraud, ten years, and a shorter period for fraud that occurred by carelessness or mistake, which is only one year. The Court determined that this fraud was deliberate, so it should be subject to the ten-year limitation. Then, the plaintiff argued negligent misrepresentation, which has a one-year prescription period. Next, plaintiff argued that she detrimentally relied on the lawyer’s recommendations and misrepresentations in the contract. Under this claim, non-action on a contract has a ten-year limitation, and acting on the contract incorrectly has a tort prescription of only one year. The Court determined that since the lawyer acted on the contract, although incorrectly, then the one-year period should apply.

Lastly, plaintiff brought a claim for conspiracy. However, under the Louisiana Code, the claim of conspiracy is not a crime in itself because it must be connected to some other crime. That is, you must conspire to do something illegal, just not conspire generally. The prescription period, then, depends on what the individual is conspiring to do. In this case, the alleged crime is conspiracy to commit misrepresentation, and since misrepresentation has a one-year prescription period, then the conspiracy claim does as well.

The Court then determined when the period started. The plaintiff argued that the doctrine of contra non valentem agree nulla currit praescriptio should apply–allowing the prescription period to begin only when the plaintiff knew about the fraud or misrepresentation. The plaintiff explained that she did not fully understand the misrepresentation until 2011, but the Court disagreed, stating that she should have known about it when she received the accounting for her trust in 2003. When the plaintiff should have reasonably known, that is known as constructive knowledge. The Court determined that since she had constructive knowledge in 2003, then her fraud claim is the only active claim since it had a prescription period of ten years.

This case explains that the prescription periods can be very complicated, depending on the nature of your claim. It also emphasizes that you should act quickly if you have a potential claim. While the one-year period may seem like a long time, it takes a considerable amount of time to gather all the information and documents needed to bring a case to court.

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A recent United States Court of Appeals for the Fifth Circuit case set out an extensive definition and explanation of summary judgment. Summary judgment occurs when there are “no genuine dispute[s] as to any material fact.” That is, both parties agree with all of the facts that are used to determine the case. A “material fact” is one that could affect the overall outcome of the case based on the applicable law. When summary judgments are appealed, the appeals court uses a de novo standard–they look at all the facts and apply the same standards as the lower court would. They examine the facts “in the light most favorable to the nonmoving party.” However, the court will not just accept unsubstantiated allegations in favor of the nonmoving party; the claims have to have some support. The nonmoving party is the party that won summary judgment in the lower court, so the moving party is the party that is contesting the summary judgment.

When examining a summary judgment on appeal, the moving party has the burden of proving that summary judgment is inappropriate. In order to do that, the moving party must show that there is some dispute regarding a material fact. The burden is somewhat light if the moving party would not have the burden if the case went to trial. Instead, the moving party would only have to show, “that there is an absence of evidence to support the nonmoving party’s case” instead of proving that the evidence may weigh in the moving party’s favor. Once the moving party has proven their burden, then the nonmoving party will take the burden and must counter the moving party’s arguments.

In the Fifth Circuit case, a homeowner alleged that Hurricane Ike caused damage to his roof that his insurance company should cover. His roof was leaking and he pointed out that the wind likely damaged his roof, causing water leaks. State Farm, his insurance company, completed an evaluation of the roof and determined that he was missing four shingles, had four damaged ridge caps and had acquired one fresh interior water spot. State Farm concluded that most of the damage that the plaintiff complained of was actually damage that could have only occurred over several years due to deterioration or faulty workmanship when the roof was installed. The State Farm insurance policy did not cover these two latter instances, but provided reimbursement for the damaged shingles, ridge caps, and the new water spot in the ceiling. State Farm awarded roughly $450.00.

The plaintiff was very unhappy with this result and conducted damage evaluations of its own, each of which concluded that the damage was considerably higher than State Farm provided. However, these damage reports did not mention how the damage was caused; they just explained how much it would cost to fix the water damage as a whole. State Farm also conducted damage evaluations that separated any damage likely caused by Hurricane Ike and damage caused by leaking over time. Their evaluations were consistent with what they already awarded the plaintiff.

Based on the various evaluations, the lower court granted summary judgment for State Farm and the Fifth Circuit affirmed that decision. The Fifth Circuit found that the plaintiff, as the moving party, could not meet his burden to override the summary judgment determination. The Court found that the evaluations as to any damage that Hurricane Ike may have caused were extremely important in this case. Since the only wind damage would have been related to the missing shingles, damaged ridge caps, and small water spot, and State Farm already paid for that, the Court found no reason to override the summary judgment.

Once summary judgment has been awarded, it is somewhat difficult to overcome on appeal.

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