Insurance Dispute

September 7, 2016

Opelousas Rear End Automobile Accident Leads To Million Dollar Uninsured Motorist Policy

car-accident-2-1449295-1-1024x681 A rear-end collision in Opelousas has led to a demonstration on how complex lawsuits concerning insurance companies can be. The Third Circuit Court of Appeal reversed a trial court’s decision regarding damages suffered in the accident, focusing on the amount owed to the plaintiffs by two different insurance companies.

The facts of the case are as follows: a vehicle operated by Ms. Rodgers, insured by Allstate Insurance, and owned by a Ms. Kennerson, rear-ended a vehicle operated by Ms. Bell, insured by Progressive Insurance, and owned by Compass LLC. The vehicle operated by Ms. Bell had an additional five passengers in the vehicle, while Ms. Rodgers was the sole occupant of the vehicle she was operating. Three of the passengers in Ms. Bell’s vehicle filed a Petition for Damages alleging entitlement to Uninsured Motorist Coverage (UM), naming Progressive as a defendant in its capacity as the UM insurer of the vehicle Bell was driing when the accident occurred. The other two passengers in Ms. Bell’s vehicle filed a Petition for Intervention, also naming Progressive as a defendant. Finally, Ms. Bell filed a Petition for Intervention, naming Rodgers, Allstate, and Progressive as defendants.

Compass LLC had purchased a combined single limit (CSL) auto insurance policy from Progressive which provided liability coverage in the amount of $1 million. In 2007, a Compass representative executed an Uninsured/Underinsured Motorist Bodily Injury (UMBI) Coverage Form issued by the Commissioner of Insurance in compliance with La. R.S. 22:680. The representative would testify he did not recall executing the form but identified his initials and signature on the form as his own. The form declared the representative selected UMBI Coverage to compensate for economic and non-economic losses with limits lower than any Bodily Injury Liability Coverage limits. Additionally, the term “$100,000” was inserted in a black preceding “each person”, with the word “person” scratched out and replaced by “CSL”.

August 21, 2016

Louisiana First Circuit Highlights Burdens of Proof in Bringing or Opposing a Motion for Summary Judgment In Ascension Parish Lawsuit

by Berniard Law Firm

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When seeking legal relief, plaintiffs will face procedural hurdles during litigation. Defendants can and will often use procedural mechanisms to avoid liability for claims brought against them. This is the nature of the game, and skilled attorneys are masters of the rules governing the conduct of civil trials. Procedural law differs from substantive law (i.e. torts, contracts, property) in that the former provides the rules for applying substantive law for live disputes. Procedural mechanisms set guidelines for what evidence the court may hear, how evidence should be interpreted, and burdens of proof. One such procedural mechanism commonly used by litigants is the “motion for summary judgment.” A recent decision of the Louisiana First Circuit Court of Appeal discusses the motion for summary judgment and the requisite burdens of proof for parties filing or opposing such motions.

On March 11, 2006, a tanker truck belonging to John Williams was delivering fuel to Mr. Preston Payton’s dredging operation near Independence, Louisiana when it picked up a cable securing the dredge in the gravel pit. The dredge sunk beneath the murky water. Mr. Payton filed a lawsuit against named defendants Mr. Williams; Republic Vanguard Insurance Company, Mr. Williams’ insurer; Texas General Agency, Republic Vanguards adjusting agency; and Randy Anny, who leased the gravel pit where the accident took place. Mr. Payton’s Petition claimed that the defendants entered into a settlement agreement with him and agreed to pay him $256,714.86 as replacement for his dredge. Mr. Payton’s Petition also claimed that instead of paying him directly, Republic Vanguard and Texas General made the settlement check payable to Mr. Anny, who was obligated to pay Mr. Payton. According to Mr. Payton’s petition, the check used by Mr. Anny to pay him was drawn from an account with insufficient funds.

The Trial Court granted Republic Vanguard’s and Texas General’s motion for summary judgment which alleged that Mr. Payton failed to produce sufficient evidence showing that Mr. Anny acted as their agent. Mr. Payton appealed.

August 18, 2016

Louisiana’s No Pay, No Play Law Effects Not Only Car Owner but The Note Holder On As Well

by Berniard Law Firm

golden-coins-1426194-1024x768 In Louisiana the owners of motor vehicles are required by law to maintain a minimum amount of insurance in case of a collision. That’s the law and there is no getting around it. The rational behind it is simple, if you crash your car into someone else there needs to be at least a minimum amount that can be recovered by the other person. The consequences of not following that law is a bar from recovering the first $15,000 for your injuries and the first $25,000 of any property damage that you incur if you are in a wreck and it’s not your fault. Those penalties are harsh, but what happens if you fail to maintain insurance and you still have a note on your vehicle? Is the note holder left out in the cold for that first $25,000 to repair the car as well? The following case out of Baton Rouge Louisiana demonstrates what happens in those circumstances.

M&M Financial Services, Inc. held a security interest in Sheilda Hayes’ vehicle and was owed a balance of $11,446.80 on its promissory note. Unfortunately for Ms. Hayes while driving her that vehicle without insurance Jerry Richard collided with her. Richard was insured by National Automotive Insurance Company, so M&M filed a lawsuit in Baton Rouge seeking to recover the remaining balance on the Hayes’ destroyed vehicle, plus legal interest and attorney fees. Both parties filed motions for summary judgment. In those motions the litigants sought to narrow the issues before the trial court. The defendants, Richard and National, argued that M&M was not entitled to the remaining balance on its note because of Louisiana’s “No Pay, No Play” law which bars recovery for the first $25,000 in property damages sustained by an owner or operator of an uninsured vehicle involved in an accident. Louisiana Revised Statute 32:866. However, the trial court didn’t buy that argument and ruled in favor of M&M and granted them their balance of $11,446.80, plus legal interest and attorney fees.

The case was appealed before the 1st Circuit Court of Appeal in Baton Rouge. The appellate court reversed the judgment in favor of M&M and instead granted the defendants’ motion dismissing the case with prejudice. The appellate court ruled that no issues of material fact are present in this case because all of the parties agree that M&M held a security interest in Hayes’ vehicle and that the vehicle was uninsured at the time of the accident. Therefore, M&M’s financial right is a question of law turning on the interpretation of Louisiana statutes. The appeals court then went on to evaluate those statutes and discussed how they applied to this facts of this case.

August 9, 2016

Arbitration Agreements and Louisiana’s Direct Action Statute Collide in East Baton Rouge Medical Malpractice Lawsuit

by Berniard Law Firm

california-7-1557119-1-768x1024 Louisiana is a “Direct Action State” which means that an injured party has the option to sue an insurer for coverage under someone else’s policy. See La. Rev. Stat. 22:1269. Therefore it’s permissible in Louisiana to name the insurance company of the tortfeasor when filing a lawsuit. An example: John Doe believes he was injured by the fault of Jane Smith, he then files a lawsuit naming Jane Smith and her insurance company State Farm. (John Doe vs. Jane Smith and State Farm.) However, what if that insurer (State Farm) has an arbitration agreement with it’s insured (Jane Smith) that says all disputes must be arbitrated? Will that cause the injured person (John Doe) to be forced into arbitration for his claims as well? The following case arising out of East Baton Rouge parish shows how Louisiana Courts have dealt with just such a situation.

In November of 2011, Ronald and Angela Courville filed a medical malpractice claim against an East Baton Rouge Doctor and his clinic. Additionally, the Courvilles’ sued that doctor’s insurance company, Allied Professionals Insurance Company (APIC). APIC is an Arizona risk retention group created according to the Liability Risk Retention Act of 1986 (LRRA). Under a provision in the insurance contract between the doctor and APIC, it states any issues will be resolved through arbitration in California. APIC filed a motion to compel arbitration and stay the lawsuit. A “stay” in the lawsuit essentially means that the Courville’s lawsuit would not be able to proceed in anyway. The trial court granted the motion to stay the matter and ordered all parties to submit to binding arbitration in California. The Courville’s appealed that ruling to the Court of Appeal for the First Circuit of Louisiana.

The First Circuit reasoned, when a court decides the issue of arbitration the court must first decide whether the parties agreed to any kind of arbitration. Additionally, if the court finds the parties did consent to arbitration, the court looks to see if there are any federal standards which make an issue unable to be resolved using arbitration. Furthermore, in Louisiana, the court looks to two basic facts before ordering people to attend arbitration. First, whether there is a dispute as to the making of the agreement for arbitration, and second, whether a party has failed to comply with the arbitration agreement.

July 25, 2016

Louisiana First Circuit Court of Appeal Tackles Questions of Amended Pleadings and Federal Jurisdiction

by Berniard Law Firm

house-fire-3-1519596-1024x771 In bringing or defending against a lawsuit, an important question is which court should hear the merits of the dispute, a state court or a federal court. Any court hearing the lawsuit must have “jurisdiction”; the power to hear a particular dispute. Under 28 U.S.C. § 1332, titled “diversity jurisdiction”, federal courts have original jurisdiction over all civil actions between citizens of different states and the amount in controversy (damages sought) exceed $75,000, exclusive of interest and costs. 28 U.S.C. § 1441 allows the defendants to remove civil actions from state courts to federal courts when a case becomes “removable,” i.e. when federal courts would have proper jurisdiction over the case. Skilled lawyers know that jurisdictional issues can have significant effect on the outcome of the case and understand the nuances of procedural posturing. A 2015 case from the Louisiana First Circuit Court of Appeal discusses how amendments or supplements to pleadings such as a Petition can raise important jurisdictional questions.

On April 3, 2011, Jerry and Elnora Harris’s home in Springfield, Louisiana burned to ashes. A year later, the Harrises filed a lawsuit against Union National Fire Insurance Company for the payment of their policy limits, penalties, and attorney fees. In their petition against Union National, the Harrises asserted that the total amount of damages did not exceed $75,000.00 including attorney fees, penalties, and interest. On April 9, 2012, the Harrises amended their petition, adding as defendants Bank of New York Melon, successor-in-interest to J.P. Morgan Chase Bank. The Harrises’ Amended Petition alleged that the Defendants engaged in predatory lending and fraudulent practices and sought additional damages for mental anguish, damage to their credit, and attorney fees. The Amended Petition stated that the total amount of damages sought by the plaintiffs against all named defendants would not exceed $75,000.00 including attorney fees, penalties, and interest.

On November 15, 2013, after the Defendants filed exceptions and answered the Petition and Amended Petition, the Harrises filed a Second Amended Petition, asserting that the total amount of damages against all defendants would exceed $75,000.00. The Defendants countered by filing a motion to strike the Second Amended Petition from the record, or alternatively, set for a hearing. The Trial Court granted the Defendants’ motion and ordered that the Second Amended Petition be struck from the record. The Harrises then filed a motion to vacate that order and requested that the Trail Court reinstate their Second Amended petition. After a hearing, the Trial Court vacated the order dismissing the Harrises’ Second Amended Petition and imposed sanctions of the Defendants for filing a frivolous motion to strike.

July 7, 2016

What Are the Requirements to Prove an Insurance Policy was Cancelled in Louisiana?

by Berniard Law Firm

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If you are injured in a car wreck you typically look to the person who caused the accident and their insurance company to cover your damages. But what happens if the reckless driver’s insurance company claims they cancelled the insurance policy before the accident occurred? How can you determine whether or not that insurance company followed the proper procedures under Louisiana to cancel coverage? The best car wreck attorneys know the law and whether or not the insurance company followed it. The following case out of New Orleans Louisiana demonstrates the steps an insurance company must follow when they cancel coverage and how they can evade liability by proper notification.

Mario Diaz learned the hard way that if you are are struck by an uninsured driver, you may not be able to recover when that driver is at fault in an accident that caused your injuries. Mr. Diaz was a passenger in a car driven by Eudolio Lopez in New Orleans, Louisiana when Mr. Lopez crashed into a vehicle driven by Darrell Butler. Mr. Diaz filed a lawsuit against Mr. Lopez, Mr. Butler and his insurer, Allstate. Allstate, the insurer of Mr. Butler, responded to the lawsuit by filing a motion for summary judgment, contending that Mr. Butler was no longer covered under his Allstate policy because he had failed to keep up with his payments and had received adequate notice of the cancellation of his policy.

Allstate provided proof that the policy was canceled on February 3, 2011 after a letter was mailed to Mr. Butler on January 24, 2011 demanding he pay his premiums or lose his coverage. Allstate provided an affidavit from Ms. Collard, who controlled all of Allstate’s policy records in the state of Louisiana, stating that she had reviewed Mr. Butler’s file and confirmed that a notice was sent to Mr. Butler and that he failed to pay on time. The First City Court of New Orleans agreed and granted the motion for summary judgment. Thus, the trial court found that there was adequate proof of a cancelled policy well before the accident occurred. See Louisiana Revised Statute 22:1266.

June 26, 2016

Do I Have Uninsured or Underinsured Motorist Coverage In Louisiana?

by Berniard Law Firm

Imagine you are in an accident with a negligent driver. You seek to recover from the negligent driver’s insurance company, only to discover that he or she does not carry any insurance. If you are in Louisiana, you are in luck. Louisiana’s uninsured motorist (“UM”) law protects drivers from the negligence of uninsured motorists. It allows automobile accident victims to recover damages even when the other driver is without insurance. It even provides additional or excess coverage when the other driver is inadequately insured. But how do you know if you have UM or not? UM coverage is implied in every automobile policy and will be read into the policy unless it is validly rejected. In a recent case, the Louisiana Third Circuit Court of Appeal examined exactly who has the authority to waive or reject UM coverage and the requirements of a valid waiver.

In 2007, Naddia Melder was injured in an automobile accident in Alexandria, Louisiana. Ms. Melder was driving her 2006 Nissan truck when she was struck by another vehicle driven by Connie Turlington. Ms. Turlington was uninsured. Ms. Melder’s vehicle was provided to her by her employer, Grimes Industrial Supply, L.L.C., although it was owned by another company, Grimes True Value Hardware, L.L.C. State Farm insured Ms. Melder’s vehicle and provided uninsured motorist coverage to her. Ms. Melder also held a separate policy with Louisiana State Farm Bureau Casualty Insurance Company which provided additional uninsured motorist coverage to her as an insured.

Ms. Melder and Randel Melder filed a lawsuit against State Farm and Farm Bureau for uninsured coverage. State Farm responded with a motion for summary judgment seeking dismissal of the Melders’ claims. It argued that the owner of Grimes Industrial Supply, Floyd Grimes, declined uninsured motorist coverage under the State Farm policy which provided coverage for the vehicle Ms. Melder drove during the collision. The Trial Court granted State Farm’s motion for summary judgment, dismissing it as a defendant. The Melders appealed, arguing that the Trial Court erroneously held that Floyd and Frank Grimes were the named insureds under the State Farm policy. More specifically, the Melders argued that Grimes True Value Hardware, L.L.C. was the named insured.

December 2, 2013

Court Throws Out Lafayette Parish Case As Plaintiff Fails To Deliver Service of Process Before Deadline

by Berniard Law Firm

It is vital to know proper court procedures at the outset of litigation or else an otherwise valid claim might be thrown out of court without ever being heard. One prime example is the need to send initial court documents to a defendant within a set deadline (sending such documents, such as a citation or summons, is known as service of process). Case in point, the Lafayette Parish Court of Appeal, in Boka v. Oller, recently upheld the dismissal of a claim without even considering the merits because service of process was delivered too late. Therefore, it is important to know the rules before bringing a lawsuit or a good claim might be lost due to a mere technicality, such as delivering papers too late. For a non-lawyer, an attorney can be instrumental in making sure proper procedures are followed so that the party has a chance to present their case in court.

In Lafayette Parish, Louisiana Code of Civil Procedure Article 1201 requires that service of the citation must be requested within a deadline of ninety days from commencement of the action. Article 1201 also notes that service of process on defendants is “essential” and “without them all proceedings are absolutely null.” The deadline for service is to ensure that defendants are aware of an action and have enough to prepare. Therefore, as a delay in service is deemed unfair to the defendant, a court may dismiss a claim if service of process is sent too late.

There are some limited exceptions to the rule, but, due to the risks involved in these exceptions, generally a party should attempt to serve process on time. For example, one exception permits late service if there is good cause for the delay. However, as the court is unlikely to accept run-of-the-mill excuses for delays, proving a good cause for failure to serve process on time can be difficult. As noted below, the court in Lafayette Parish found that there was no good cause for late service as the plaintiff knew the defendant’s address.

November 28, 2013

Appeals Court Upholds Jones Act Claim for Seaman Injured Off Gulf Coast

by Berniard Law Firm

The Jones Act is a law that provides seamen the chance to bring personal injury suits against the owners and operators of vessels they are working on in cases where the owner or operator was negligent or in some other way at fault for the injury. One of the types of damage allowable under the Jones Act is that of maintenance and cure. In maritime law, maintenance is the employee’s daily living expenses and cure is the employee’s medical bills. If an employer has to pay maintenance and cure, they will only have to pay such costs until the seaman is either fit for duty, or at a point where added medical treatment will not improve his condition. This case goes into further detail about what is necessary for a plaintiff to receive an award for maintenance and cure in a Jones Act case, and the relationship between maintenance and cure and worker’s compensation in Louisiana.

In this case, the plaintiff was performing sandblasting and plating work on an offshore rig. While performing this work, the plaintiff slept and ate aboard the M/V Howard McCall, stored equipment on the vessel, and used the vessel as a work platform on several occasions. After the initial work on the rig was done, the plaintiff was brought back to the vessel to perform sandblasting work on the vessel itself. During this period of work, the plaintiff sustained injuries while exiting the ship’s wheelhouse. The plaintiff soon began receiving payments from the Louisiana Worker’s Compensation Commission who was the employer’s insurer.

Subsequently the plaintiff filed suit against both of the owners and the operator of the vessel under the Jones Act. The plaintiff made three basic claims: 1) the owners and operator of the vessel were negligent in maintaining the safety of the vessel, 2) the vessel was unseaworthy, and 3) the owners and operators owed him costs for maintenance and cure. During the jury trial, the negligence and unseaworthiness claims were dismissed, and the remaining claim of maintenance and cure was the only claim left. The jury found in the plaintiff’s favor and awarded him awards of maintenance and cure. The defendants appealed the jury’s award.

November 4, 2013

The Limited Nature of Appeals Court Highlighted in New Orleans Case

by Berniard Law Firm

Appeals courts are unique in two major respects: evidentiary requirements and standards of review. When cases are appealed, the evidentiary requirements are different at the appeals level than they were at the trial court level. For example, often the appeals court’s factual inquiry is limited to “the record,” or the facts as explained by the trial court. The appeals court cannot look beyond what is in the record or what is argued in front of them, even if they would like additional facts. Occasionally, the appeals court can look to evidence that is introduced by the parties, but many times the standard of review requires that the appeals court cannot look at evidence at all.

In addition, the standard of review depends on the type of legal question presented. The two major standards of review in Louisiana are manifest error and de novo review. In manifest error review, the appeals court simply determines whether the lower court’s outcome is probable, or lacks manifest error. They consider the facts in the record and determine if the outcome was probable given the facts. The trial court has a great deal of deference because they access the credibility of the witnesses and deal with complex evidentiary rules. The second type of review, de novo review, does not rely on the lower court. Instead, the appeals court can consider the evidence in the record as if it were a new trial. There is no need to consider what the lower court did with the information because the appeals court makes its own independent decisions. Often, however, the appeals court is still limited to the evidence in their record.

A recent case arising from the First City Court of New Orleans to the Court of Appeals for the Fourth Circuit for the State of Louisiana outlines these concepts. In that case, an individual contracted with a building contractor to make improvements on his house. The individual argued that the contractor performed poorly, and therefore did not fulfill his half of the contract, even though the contractor had already been paid. The lower court granted an exception of prematurity, which, in this case, meant that the party brought the case too early because there was a stipulation in the contract that required mediation before the parties could bring the case to court. Under the exception of prematurity, the appeals court reviews the lower court under manifest error. However, when the parties argued their case at the court of appeals, neither party put the actual contract into evidence at the appeals hearing. Since appeals courts have strict evidentiary requirements, the court could not consider what the contract actually stated. Therefore, it struck down the exception of prematurity.