Negligence Claims

Vicarious Liability Explored in Jones Act Case

Published on: July 9, 2013 | By Berniard Law Firm

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.

Summary Judgment Granted in Uninsured Motorist Dispute

Published on: June 26, 2013 | By Berniard Law Firm

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.

“Other Insurance” Provisions and the Delays Associated with Conflicting Policies

Published on: June 17, 2013 | By Berniard Law Firm

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.

Disability Benefits Center of Car Accident-Based Appeal

Published on: May 24, 2013 | By Berniard Law Firm

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.

Finding the Correct Prescription Period Essential for Claims

Published on: May 20, 2013 | By Berniard Law Firm

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.

Summary Judgment Prevails Against Hurricane Ike Damages

Published on: May 14, 2013 | By Berniard Law Firm

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.

Accident in Parking Lot Leads to Appeal for Shared Responsibility

Published on: May 12, 2013 | By Berniard Law Firm

A recent case in the Parish of Lafayette, Louisiana, demonstrates conflictive viewpoints and the shifting burden of responsibility that can take place in an automobile accident, much less one taking place in a parking lot. The plaintiff, Ms. Duhon, was driving her 2009 Lincoln MKX in a parking lot on property in Lafayette when a 2006 Toyota Sequoia driven by Ms. Foley entered the parking lot from Ambassador Caffery Parkway and the vehicles collided. The defendant was insured by State Farm Mutual Automobile Insurance Company (State Farm).

Ms. Duhon filed suit against Ms. Foley and her insurer, State Farm, seeking recovery for (1) the out of pocket deductible she paid for repairs to her vehicle; (2) the out of pocket rental expenses she paid; and, (3) the diminution in value of her vehicle as a result of this accident. However, the trial court held a bench trial and ruled in favor of Ms. Foley, finding Ms. Duhon one hundred percent at fault for the incident, eventually leading to an appeal.

Ms. Duhon asserts the trial court erred in finding her at fault and denying her recovery of the damages she allegedly sustained in the accident. The Court of Appeal, for the Second Circuit of Louisiana, amended the trial court’s decision to a fifty-fifty fault allocation. The Court applies the manifest error standard of review in their findings. Under this standard, the Court of Appeal must meet the following two-part test: (1) find that a reasonable factual basis does not exist for the finding, and (2) further determine that the record establishes that the fact finder is clearly wrong or manifestly erroneous. After reviewing the record in its entirety, the Court of Appeal found that a reasonable factual basis does not exist for the trial court’s findings and that the trial court’s determination of negligence exclusively on the part of Ms. Duhon was manifest error. Not only did Ms. Foley’s testimony conflict with Ms. Duhon’s, it was also not corroborated by the physical evidence. Even the trial court intimated comparative fault of the drivers when it stated in its oral reasons for judgment that “neither party entered with enough caution to avoid the accident.” Thus, the trial court erred in assessing no fault to Ms. Foley for this accident.

Louisiana Supreme Court Finds Binding Arbitration Clause Fair and Reasonable to the Client

Published on: May 10, 2013 | By Berniard Law Firm

The Louisiana Supreme Court has recently undertaken a case deciding whether arbitration clauses in attorney-client retainer agreements are appropriate. In the past, Louisiana has favored the enforcement of arbitration clauses in written contracts. Arbitration avoids taking a case to trial and is a thrifty and efficient way to conduct the resolution of disputes outside of the courts. During arbitration, each party refers its dispute to an arbitrator, who then imposes a decision that is legally binding for both sides. However, Louisiana law also imposes a fiduciary duty requiring attorneys to act with the utmost fidelity and forthrightness in their dealings with clients and any contractual clause, which may limit the client’s rights against the attorney is subject to the upmost scrutiny.

According to the Louisiana Supreme Court in Hodges v. Reasonover, there is no per se rule against such binding arbitration clauses, provided that they are fair and reasonable to the client. In Hodges v. Reasonover, Jacqueline Hodges, the founder, sole shareholder, and CEO of Med-Data Management, Inc., hired Kirk Reasonover of the law firm of Reasonover & Olinde to sue a company known as MedAssets, Inc. in federal court in Atlanta, Georgia. In the retainer agreement between Hodges and Reasonover there was an arbitration clause, which essentially provided that any dispute shall be submitted to arbitration in New Orleans, Louisiana and that such arbitration shall be submitted to the American Arbitration Association (AAA).

Hodges was ultimately unsuccessful on her suit against MedAssets, Inc., which led her to file suit for legal malpractice against Reasonover. According to the Louisiana Supreme Court, Courts must closely scrutinize attorney-client agreements for signs of unfairness or overreaching by the attorney. Further, Louisiana Rule of Professional Conduct 1.8(h)(1) prohibits a lawyer from “prospectively limiting the lawyer’s liability to a client for malpractice unless the client is independently represented in making the agreement.”

Louisiana Couple Injured in Car Accident Seeks Recovery from Insurance Companies

Published on: May 6, 2013 | By Berniard Law Firm

You have just been involved in a car accident. Someone else was driving, and you bring suit against them and several insurance companies that are involved. But who has the burden of proof to prove how much you should be able to recover from the insurance companies? In Louisiana, that burden is on the plaintiff. The plaintiff, when seeking a declaration of coverage under an insurance policy, has to prove that his or her claims are covered under the policy coverage and also has to establish all essential facts in order to recover.

How would this play out? Well, recently, this exact situation played out in Louisiana. A couple was riding in a car driven by another man. The man driving had rented the car from Houston, Texas, but the case was tried in Louisiana. At some point while driving the couple, the man lost control of the vehicle and ended up flipping the car twice. The couple suffered severe injuries from the accident and then filed suit.

Not only did the plaintiffs (the couple) file suit against the man driving, but they also filed suit against several insurance companies involved. Before actually bringing the case to trial, the couple tried to settle the case with a couple of the insurance companies, and the couple received checks in the full amount of the coverage under those insurance companies. However, it was not clear whether or not this was a full recovery. The plaintiffs also wanted to receive payment from the insurance company from the uninsured/underinsured motorist coverage (UM coverage). During the time the parties were trying to decide if this was a complete settlement or not, the plaintiffs’ attorney went ahead and gave his clients the check. The defendants then filed a motion for summary judgment, stating that UM insurance coverage was not available. After several motions and cross motions, the trial court decided that UM coverage was not available to the plaintiffs and granted the motion of summary judgment in favor of the defendants.

When this case was brought to the appellate court, the court analyzed the case de novo (or as if the trial court had not already tried the case) and decided to affirm the trial court’s ruling. Why did they affirm the trial court’s ruling? This is primarily because the plaintiff has the burden of proving what he or she is owed under the insurance policy, and the plaintiffs in this case could not prove that they should be able to recover under UM coverage.

The reason that the plaintiffs could not prove that they should be able to recover under UM coverage is because of the plain language of the insurance coverage policy. Normally, summary judgment should only be granted if there is no reasonable interpretation of the policy, supported by evidence and the facts of the case, that would support granting coverage. This seems like a pretty lenient standard for the plaintiffs, but it still requires that the plaintiffs prove that there is a reasonable interpretation of the policy that does allow them to recover in the manner that they are seeking. And in this case there was not.

In the language of the policy, several clear definitions were given, and as long as the policy wording is clear, then the agreement has to be enforced as it is written. In this case, the policy language stated that in order to recover under UM coverage, the vehicle cannot be available for regular use. However, in this case, the rented vehicle was clearly available for regular use during the rental period, and the vehicle, therefore, could not be classified as underinsured. So the plaintiffs were not entitled to recover any more than they already had.

If you have been involved in a car accident, you want to make sure that you claim and recover the proper amount that is available to you under the various insurance policies involved in the case.

The Carefully Worded Insurance Policy: Making Sure Your Coverage Matches Your Expectations

Published on: May 2, 2013 | By Berniard Law Firm

Do you drive an automobile insured through an employer? How well do you know the policy? It’s possible that you aren’t covered as well as you think.

The petitioners of Broussard v. Progressive Sec. Ins. Co. were merely seeking coverage compensation after a seemingly simple traffic accident in Maurice, Louisiana. They ended up in court and dealt with costly appeals over whether or not the driver of the other automobile, a dump truck, was insured by the business who hired him for this particular haul. The driver, who owned the dump truck, was a contractor, and thus not an employee. As a result, he was screened out of much of the hiring company’s insurance policies, thus potentially inhibiting the petitioners’ attempt to recover.

The major questions regarding the insurance coverage were over the definition of a “hired” auto and the definition of a “nonowned auto,” in light of the specific policy at hand. While it may seem at first glance that the dump truck had to qualify under one of these categories, the court found there was a genuine issue of material fact as to whether the company had “hired” the truck or “hired” the services of the driver. This distinction is important because specifically hiring the truck would result in coverage under this insurance policy, whereas hiring the full services of a driver would not result in coverage for the truck. The court considered invoice tickets engaging the driver’s company generally, and not a specific vehicle, to be a relevant factor in deciding this issue.