United States District Court,

M.D. Louisiana.

STEVEN MOORE, ET AL.

v.

HOME DEPOT U.S.A., INC., ET AL.

CIVIL ACTION NO.: 16-00810-BAJ-RLB

|

11/08/2017

 

 

RULING AND ORDER

BRIAN A. JACKSON, CHIEF JUDGE UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF LOUISIANA

*1 Before the Court are the Motions to Dismiss Entergy Louisiana LLC’s (“Entergy”) Third Party Complaint (Docs. 53, 54, 72) filed by S&H Trucking. Inc., Commercial Coolants, Inc. d/b/a Design Air Systems (“Design Air”), and Fleet Personnel Corporation. Also before the Court is the Motion for Summary Judgment (Doc. 66) filed by Countrywide Payroll & HR Solutions, Inc., the Motion to Dismiss (Doc. 71) filed by Design Air, and the Motion to Dismiss (Doc. 84) filed by Home Depot U.S.A., Inc. The parties filed oppositions (Docs. 62, 78, 81, 86, 92) and replies (Docs. 63 and 93), where applicable. For the following reasons, the Motions to Dismiss (Docs. 53, 54, 71, 72, 84) are DENIED and the Motion for Summary Judgment (Doc. 66) is GRANTED.

 

 

1. BACKGROUND

Plaintiffs Steven Moore and Renee Moore claim that Steven Moore was seriously injured while delivering equipment to a Home Depot in Baton Rouge, Louisiana. (Doc. 1-2). Plaintiffs allege that on November 2, 2015, Mr. Moore arrived at the Home Depot before normal store hours to deliver some equipment for what the Court presumes was some kind of construction project, and that the Home Depot was not ready to unload his cargo. Id. at ¶ 2. Plaintiffs allege that Home Depot employees then directed Mr. Moore to a parking area on Home Depot property where they should have known that there was a high voltage power line. Id. at ¶ 3-4. Plaintiffs further allege that while preparing to unload his delivery, Mr. Moore came into contact with low-hanging power lines and he sustained significant injuries, including the loss of his leg. Id. at ¶¶ 7, 9. Plaintiffs allege that he was employed by S&H Trucking while making the delivery. Id. at ¶ 2. Mr. Moore seeks damages as a result of his alleged injury and his wife, Mrs. Moore, seeks damages for loss of consortium. Id. at ¶¶ 9, 12)

 

Plaintiffs sued Home Depot, Entergy, RLM Consulting, LLC, Richard Morris, The Travelers Indemnity Company of Connecticut, Design Air Systems, and Depositors Insurance Company. (Docs. 1-2 and 50). Plaintiffs claim that Home Depot failed to maintain the power line in a safe condition, failed to warn Mr. Moore of an unsafe condition, and failed to ensure that the power line was a safe distance above the ground. (Doc. 1-2 at ¶ 10). Plaintiffs allege that Entergy failed to maintain the power line and to ensure that it was at a safe height, and that it failed to warn Mr. Moore of other dangerous conditions. Id. at ¶ 11.

 

Plaintiffs also claim that Mr. Morris is the sole stock holder of RLM Consulting and that he was the project coordinator/manager of the construction project at the Home Depot. (Doc. 50 at ¶ 1(c)). Plaintiffs claim that Design Air was involved in the construction project as well. Id. at ¶ 2-3. Plaintiffs claim that RLM Consulting, Mr. Morris, and Design Air failed to provide Plaintiff a safe space to unload the HVAC system, failed to ensure that Mr. Moore had a safe area to park, failed to provide adequate supervision, and failed to contact Entergy to ensure that the power line met safe and proper height restrictions. Id. at ¶ 2-3, 5. Plaintiff alleges that Travelers was the liability insurer of RLM Consulting, Id. at ¶ 4, and that Depositors provided an insurance policy to Design Air. Id. at ¶ 5.

 

*2 Entergy then filed third party demands against S&H Trucking, (Doc. 9), Project RLM Consulting, LLC, Richard Morris, Design Air Systems, and Fleet Personnel Corporation. (Doc. 37).1 Entergy seeks indemnification from these third party defendants under the Louisiana Overhead Power Line Safety Act because they allegedly failed to contact or notify Entergy of any plans to perform work within ten feet of an Entergy power line, as required by the Overhead Power Act. Id. at ¶ 7.

 

Depositors Insurance Company then filed a crossclaim against Home Depot. (Doc. 68). Depositors alleges that Home Depot demanded that it defend and indemnify Home Depot. Id. at ¶ 10. Depositors alleges that about a month later, it declined to defend and indemnify Home Depot. Id. at ¶ 33. Depositors alleges that it issued a general liability policy and an umbrella policy to Design Air, in effect at the time of Mr. Moore’s accident. Id. at ¶ 27. It also claims that Home Depot was not a named insured on the Depositors insurance policies that were issued to Design Air. Id. at ¶ 27. Depositors also asserts that Home Depot is not covered by the blanket additional insured endorsements. Id. at ¶ 27. Based on these allegations. Depositors seeks a declaratory judgment that it does not owe a duty to indemnify or defend Home Depot. Id. at ¶ 35.

 

 

1. DISCUSSION
2. Motions to Dismiss

A motion to dismiss under Rule 12(b)(6) tests the sufficiency of the complaint against the legal standard set forth in Rule 8, which requires “a short and plain statement of the claim showing that the pleader is entitled to relief.” Rule 8(a)(2). “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ ” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “Determining whether a complaint states a plausible claim for relief [is] … a context-specific task that requires the reviewing court to draw on its judicial experience and common sense.” Ashcroft, 556 U.S. at 679.

 

“[F]acial plausibility” exists “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. at 678 (citing Twombly, 550 U.S. at 556). Hence, the complaint need not set out “detailed factual allegations,” but something “more than labels and conclusions, and a formulaic recitation of the elements of a cause of action” is required. Twombly, 550 U.S. at 555. When conducting its inquiry, the Court “accepts all well-pleaded facts as true and views those facts in the light most favourable to the plaintiff.” Bustos v. Martini Club Inc., 599 F.3d 458, 461 (5th Cir. 2010) (quotation marks omitted).

 

 

1. Design Air System’s Motion to Dismiss

Plaintiffs allege that Design Air’s negligence caused Mr. Moore’s injuries. (Doc. 1-2). Design Air argues that Plaintiffs negligence claim should be dismissed because Design Air Systems did not owe a duty to Mr. Moore at the time of the accident. (Doc. 71-1 at p. 1). In a negligence action under Louisiana law, courts apply the “duty risk analysis” in which a plaintiff must establish, among other things, that the defendant owed the plaintiff a duty of care. Rando v. Anco Insulations Inc., 16 So. 3d 1065, 1086 (La. 2009). Determining whether a defendant owes a duty of care to a plaintiff is a question of law, which turns on “whether the plaintiff has any law (statutory, jurisprudential, or arising from general principles of fault) to support the claim that the defendant owed him a duty.” Id. In Louisiana, “[t]here is an almost universal duty on the part of the defendant in a negligence action to use reasonable care to avoid injury to another.” Id. But “[i]n some cases, the duty is refined more specifically that the defendant must conform his or her conduct to some specially defined standard of behavior.” Boykin v. Louisiana Transit Co., 707 So. 2d 1225, 1231 (La. 1998).

 

*3 Design Air argues that it did not owe a duty to Mr. Moore because Design Air did not exert any control over Mr. Moore while he was delivering equipment to Home Depot. (Doc. 71-1 at p. 6). In support of this contention, Design Air cites Groover v. Camp Dresser & McKee Inc., 420 F. App’x 358 (5th Cir. 2011). In Groover, the court held that a principal is not liable for the injuries resulting from the negligent acts of an independent contract, unless the principal controls the contractor’s work. Id. at 362. Here, however, Plaintiffs do not allege that Design Air was an independent contractor or a principal, rather Plaintiffs allege that Design Air “was involved in the installation of the HVAC equipment for the construction project at the Home Depot facility in Baton Rouge, Louisiana[.]” (Doc. 50 at ¶ 1(f)). Plaintiffs further allege that Design Air was negligent by failing to provide Mr. Moore a safe place to unload, failing to ensure the location to park was safe, and failing to provide adequate supervision of the unloading operation. (Doc. 50 at ¶ 5). In other words, Plaintiffs allege that Design Air was directly negligent to Mr. Moore, and the claims do not implicate agency theories of principal and independent contractor liability. The facts as alleged do not implicate Groover. Because Plaintiffs allege that Design Air was involved in the very construction project that resulted in Mr. Moore’s injuries, Plaintiffs have alleged sufficient facts to establish that Design Air owed Mr. Moore a duty of care at the time he was injured. Ashcroft, 556 U.S. at 679. Plaintiffs therefore adequately allege a claim of negligence against Design Air. Design Air’s Motion to Dismiss is denied.

 

 

2. S&H Trucking, Design Air, and Fleet Personnel’s Motions to Dismiss Entergy’s Third Party Complaint

Entergy filed a third party complaint, seeking indemnification from S&H Trucking, Design Air, and Fleet Personnel because it alleges that they failed to notify Entergy of their plans to perform work within ten feet of its overhead power lines, as required by the Overhead Power Act. (Docs. 9 at ¶ 27 and 37 at p. 2). S&H Trucking, Design Air, and Fleet Personnel seek to dismiss Entergy’s third party complaint. (Docs. 53, 54, 72). The Overhead Power Act provides that: (1) “[w]hen any person desires to temporarily carry on any function, activity, work, or operation” within ten feet of an overhead power line; (2) “the person or persons responsible for the work to be done shall promptly notify the owner or operator of the high voltage overhead line prior to the scheduled commencement of the work.”2 La. R.S. 45:143. If a person violates this provision, they are “liable to the owner or operator of the high voltage overhead line for all damages, costs, or expenses incurred by the owner or operator as a result of the contact” if the violation “results in physical or electrical contact with any high voltage overhead line[.]” La. R.S. 45:144.

 

 

1. Whether S&H Trucking and Fleet Personnel Desired to Work Within Ten Feet of the Power Line

S&H Trucking and Fleet Personnel argue that they did not intend for Mr. Moore to carry on work near an overhead power line, and therefore they are not liable to Entergy under the Overhead Power Act. (Docs. 53-1 at p. 6 and 72-1 at p. 5). The Overhead Power Act only applies to persons who “desire[ ] to temporarily carry on any function, activity, or operation” within ten feet of an overhead line. La. R.S. 45:143. No court has interpreted this particular provision of the Overhead Power Act. But by its plain terms, the provision means that the Overhead Power Act only applies to a person who intends to work near an overhead line, and it does not apply to a person who accidentally or inadvertently works within ten feet of a power line.

 

Fleet and S&H argue that they did not intend for Mr. Moore to work within ten feet of an overhead power line. (Doc. 72-1 at p. 6 and 53-1 at p. 6). They claim that they “did not instruct, or contemplate, Moore would be carrying on any function within close proximity of overhead power lines.” Id. This claim is found nowhere in Entergy’s Complaint, (Doc. 37), and it is well-established that a party cannot rely on facts outside the complaint on a motion to dismiss. Bustos, 599 F.3d at 461. Indeed, a court may only rely on the well-pleaded allegations contained in a complaint when deciding a motion to dismiss. Id.

 

*4 Turning to the Complaint, Entergy alleges that S&H Trucking and Fleet Personnel were “responsible for the construction project, including responsibility for the safe delivery of the component being delivered by Moore.” (Doc. 37 at ¶ 6). At the motion to dismiss stage, a court must draw all reasonable inferences in plaintiffs favor. Ashcroft, 556 U.S. at 679. Considering that Entergy alleges that S&H Trucking and Fleet Personnel were responsible for the construction project where Mr. Moore contacted Entergy’s overhead power line, Entergy has pleaded sufficient facts for the Court to infer that S&H Trucking and Fleet Personnel knew Mr. Moore would be working near the power lines and that they intended for Mr. Moore to work near the overhead power lines.

 

 

1. Whether S&H Trucking, Fleet Personnel, and Design Air are Persons Responsible For the Work

S&H Trucking, Fleet Personnel, and Design Air also argue that they are not a “person or persons responsible for the work” and they therefore cannot be liable to Entergy. (Docs. 53-1 at p. 7, 72-1 at p. 7, 54-1 at p. 11). The Overhead Power Act provides that “the person or persons responsible for the work to be done shall promptly notify the owner or operator of the high voltage overhead line prior to the scheduled commencement of the work.” La. R.S. 45:143. A person “responsible for the work” includes a company that controls a work site where an overhead power line is located. See Clardy v. Bruce Foods Corp., No. 09-CV-1660, 2014 WL 3778337, at *4 (W.D. La. July 31, 2014).3 In Clardy, a company required truck drivers to wash their trucks in an area where there was an overhead power line. Id. at *1. The court held that the company was a person “responsible for the work” when a driver’s truck contacted an overhead power line in the area the company required drivers to wash their trucks. Id. at *3-4.

 

S&H, Fleet Personnel, and Design Air claim that they did not exercise control and had no authority over where the construction equipment was unloaded, and that a party other than S&H directed Mr. Moore where to park his truck and supervised the unloading location. (Doc. 53-1 at p. 7-8, 72-1 at p. 7-8, 54-1 at p. 14). Again, these facts do not appear in Entergy’s Third Party Complaint. (See Docs. 9 and 37). At this stage, the court must “accept[ ] all well-pleaded facts as true and views those facts in the light most favorable to the plaintiff.” Bustos, 599 F.3d at 461. Considering that Entergy alleges that S&H Trucking employed Mr. Moore and that S&H, Fleet Personnel, and Design Air were “responsible for the construction project” Entergy has pleaded sufficient facts to indicate that S&H, Fleet Personnel, and Design Air were “responsible for the work” that was being completed at the Home Depot where Mr. Moore contacted the power line. S&H, Fleet Personnel, and Design Air’s Motion to Dismiss are denied.

 

 

3. Home Depot’s Motion to Dismiss Depositors Insurance Company’s Cross-Claim

Depositors filed a crossclaim against Home Depot, seeking a declaratory judgment under 28 U.S.C. § 2201 that Depositors is not required to defend or indemnify Home Depot for the damages sought by Plaintiffs. (Doc. 68 at ¶ 35). Home Depot seeks to dismiss Depositors’ crossclaim. (Doc. 84). Before evaluating the merits of a declaratory judgment action, a court must determine whether it can even decide a declaratory judgment action. To do so, a court must engage in a three-step inquiry by examining: “(1) whether the declaratory action is justiciable; (2) whether the court has the authority to grant declaratory relief; and (3) whether to exercise its discretion to decide or dismiss the action.” Sherwin-Williams Co. v. Holmes Cty., 343 F.3d 383, 387 (5th Cir. 2003).

 

 

1. Whether the Declaratory Action is Justiciable

*5 A declaratory action is justiciable if there is an actual controversy between parties with adverse legal interests and it is ripe for review. Orix Credit All., Inc. v. Wolfe, 212 F.3d 891, 896 (5th Cir. 2000); Rowan Companies, Inc. v. Griffin, 876 F.2d 26, 28 (5th Cir. 1989). Home Depot argues that Depositors’ request for a declaratory judgment is not ripe because the duty to indemnify cannot be determined until fault is allocated. (Doc. 84-1 at p. 5).4 The duty to indemnify is governed by separate principles from a duty to defend. LCS Corr. Servs., Inc. v. Lexington Ins. Co., 800 F.3d 664, 668 (5th Cir. 2015). A duty to defend claim is ripe when the underlying suit is filed. See Columbia Cas. Co. v. Ga. & Fla. RailNet, Inc., 542 F.3d 106, 110 (5th Cir. 2008) (“An actual case or controversy exists before the resolution of an insured’s underlying suit concerning the insurer’s duty to defend.”); Morad v. Auiz, No. 12-2190, 2013 WL 1403298, at *2 (E.D. La. Apr. 5, 2013) (“Courts have routinely held that courts may determine an insurer’s duty to defend even before the underlying suit is decided.”).

 

By contrast, the duty to indemnify generally does not arise “until the indemnitee actually makes payment or sustains loss.” Appleman Quinlan v. Liberty Bank & Tr. Co., 575 So. 2d 336, 340 (La. 1990); see also First Nat. Bank of Louisville v. Lustig, 975 F.2d 1165, 1167 (5th Cir. 1992). But the “duty to indemnify is justiciable before the insured’s liability is determined in the liability lawsuit when the insurer has no duty to defend and the same reasons that negate the defense likewise negate any possibility the insurer will ever have a duty to indemnify.” Columbia Cas. Co., 542 F.3d at 111. For the reasons offered infra at II(A)(3)(d), Depositors alleges sufficient facts establishing that it need not indemnify Home Depot for the same reasons it need not defend Home Depot. It’s declaratory judgment action is therefore justiciable.

 

 

1. Whether the Court has the Authority to Grant Declaratory Relief

A court does not have the authority to consider a declaratory judgment action when: “(1) the declaratory defendant previously filed a cause of action in state court; (2) the state case involved the same issues as those in the federal court; and (3) the district court is prohibited from enjoining the state proceedings under section 2283.” Sherwin-Williams, 343 F.3d at 388 n.1 (internal citations omitted). The declaratory defendant, Home Depot, has not previously filed a cause of action in state court involving the same issues as those in this Court. Home Depot sued Design Air in Georgia state court for breach of contract because it allegedly refused to defend and indemnify Home Depot against the claims brought against it by Mr. Moore. See Complaint, Home Depot U.S.A., Inc., v. Commercial Coolants, Inc., 17-106794 (Ga. Sup. Ct. Sept. 5, 2017). The Georgia state action will not determine whether Depositors must defend and indemnify Home Depot because Depositors is not a party to the Georgia state case. Only Home Depot and Design Air are parties to that action. A declaratory judgment from this Court would also not effectively enjoin the Georgia proceedings because the cases present different issues. Therefore, the Court has the authority to grant declaratory relief.

 

 

1. Whether the Court Should Exercise its Discretion to Decide the Action

*6 To determine whether to exercise its discretion to decide a declaratory judgment action, courts must consider the seven Trejo factors. Sherwin-Williams Co. v. Holmes Cty., 343 F.3d 383, 388 (5th Cir. 2003). The first factor is whether there is a pending state action in which all the matters in controversy may be fully litigated. Id. Home Depot filed a Complaint in Georgia state court against Design Air on September 5, 2017. Complaint, Home Depot U.S.A., Inc., v. Commercial Coolants, Inc., 17-106794 (Ga. Sup. Ct. Sept. 5, 2017). Home Depot sued Design Air for breach of contract for refusing to defend and indemnify Home Depot against the claims brought against it by Mr. Moore. Id. at ¶ 27. Depositors is not a party to the lawsuit. Id. Therefore, the Georgia action will not decide whether Depositors has a duty to defend or indemnify Home Depot.

 

The second factor is whether the plaintiff filed suit in anticipation of a lawsuit filed by the defendant. Sherwin-Williams, 343 F.3d 383 at 388. It appears that Depositors filed its crossclaim in this Court because it was already a party to this lawsuit. It does not appear that it anticipatorily filed suit in this Court. The third factor is whether the plaintiff engaged in forum shopping in bringing the suit. Sherwin-Williams, 343 F.3d 383 at 388. Depositors did not engage in forum shopping because it sued Home Depot in the forum in which this action was already pending. Plaintiffs initially sued Depositors in this Court, and Depositors brought a counterclaim against Home Depot. The fourth factor is whether possible inequities exist in allowing the declaratory plaintiff to gain precedence in time or to change forums exist. Sherwin-Williams, 343 F.3d 383 at 388.5 Depositors will not gain precedence in time or change forums because the pending state court action does not present the same issues as this suit. The fifth factor is whether the federal court is a convenient forum for the parties and witnesses. Sherwin-Williams, 343 F.3d 383 at 388. The accident at issue occurred in Louisiana, and Home Depot has not argued that this is an inconvenient forum. (Doc. 84-1 at p. 6).

 

The sixth factor is whether retaining the lawsuit in this Court would serve the purposes of judicial economy. Sherwin-Williams, 343 F.3d 383 at 388. Depositors and Home Depot were already parties to this lawsuit and will continue to be parties regardless of the declaratory action; therefore, it is in the interest of judicial economy to retain the declaratory action. The seventh factor is whether the federal court is being called on to construe a state judicial decree involving the same parties and entered by the court before whom the parallel state suit between the same parties is pending. Sherwin-Williams, 343 F.3d 383 at 388. Depositors is not a party to the Georgia state court proceeding, and therefore this factor weighs in favor of the court exercising jurisdiction over this matter. Because the seven Trejo factors weigh in favor of deciding this case, the Court will exercise its discretion to determine whether Depositors owes a duty to indemnify and defend Home Depot.

 

 

1. Whether Depositors States a Claim for Relief under Rule 12(b)(6)

Because the court may decide Depositors’ declaratory judgment action, the court must now evaluate the merits of Depositors’ claim. Depositors alleges that it need not defend or indemnify Home Depot because although it issued insurance policies to Design Air, it did not issue a policy to Home Depot. (Doc. 68 at ¶ 27-28). More specifically, Depositors alleges that Home Depot was not a named insured or additional insured on the policies it issued to Design Air that were in effect on the date of the accident. Id. at ¶ 28. Depositors also alleges that a 2010 master services agreement, which Home Depot based its indemnity and defense demands on, is not a contract but merely an agreement to abide by certain terms in the event the parties agreed to do something in the future. Id. at ¶ 12. Taking these allegations as true, there is no contract whatsoever that obligates Depositors to indemnify or defend Home Depot.6 Depositors alleges that it did not issue a policy to Home Depot, and that the maintenance services agreement does not bind it to do anything. See Page v. Gulf Oil Corp., 775 F.2d 1311, 1315 (5th Cir. 1985) (holding that a master services agreement “merely sets out the rules of the game in the event that the parties decide to play ball[.]”). Depositors therefore alleges sufficient facts to establish that it is not required to defend or indemnify Home Depot. Home Depot’s Motion to Dismiss is denied.

 

 

1. Countrywide Payroll’s Motion for Summary Judgment

*7 Entergy seeks indemnification from Countrywide because it alleges that Countrywide failed to notify Entergy of plans to perform work within ten feet of its overhead power lines, as required by the Overhead Power Act. (Docs. 9 at ¶ 27 and 37 at p. 2). Countrywide, a staffing company, moves for summary judgment in its favor. (Doc. 66). Entergy does not oppose Countrywide’s motion for summary judgment. (Doc. 75). When a party does not file an opposition to a motion for summary judgment, the court is permitted to consider the facts alleged in support of the motion as undisputed and grant summary judgment if they show that the movant is entitled to judgment as a matter of law. See Eversley v. MBank Dallas, 843 F.2d 172, 174 (5th Cir. 1988).

 

The undisputed facts establish that Countrywide contracted with Fleet Personnel, who contracted with S&H Trucking, who directed Mr. Moore to deliver air conditioning equipment to Home Depot. (Doc. 66-2 at p. 1-2). Under its contract with Fleet, Countrywide shifted all responsibility for control, supervision, safety, and “any hazardous conditions to which [Moore] may be exposed at the work site[.]” to Fleet. Id. at ¶ 4. As previously discussed, only a “person or persons responsible for the work” is liable to Entergy under the Overhead Power Act. See La R.S. 45:143. Because the undisputed facts show that Countrywide was not responsible for Mr. Moore’s work, Countrywide is not liable to Energy under the Overhead Power Act. The Court grants Countrywide’s Motion for Summary Judgment.

 

 

III. CONCLUSION

Accordingly,

 

IT IS ORDERED that the Motion to Dismiss (Doc. 53) filed by S&H Trucking is DENIED.

 

IT IS FURTHER ORDERED that the Motion to Dismiss (Doc. 54) filed by Commercial Coolants, Inc. d/b/a Design Air Systems is DENIED.

 

IT IS FURTHER ORDERED that the Motion for Summary Judgment (Doc. 66) filed by Countrywide Payroll & HR Solutions is GRANTED. Entergy Louisiana, LLC’s claims against Countrywide Payroll & HR Solutions are DISMISSED WITH PREJUDICE.

 

IT IS FURTHER ORDERED that the Motion to Dismiss (Doc. 71) filed by Design Air Systems is DENIED.

 

IT IS FURTHER ORDERED that the Motion to Dismiss (Doc. 72) filed by Fleet Personnel Corp. is DENIED.

 

IT IS FURTHER ORDERED that the Motion to Dismiss (Doc. 84) filed by Home Depot is DENIED.

 

Baton Rouge, Louisiana, this 7th day of November, 2017.

 

All Citations

Slip Copy, 2017 WL 5180431

 

 

Footnotes

1

Entergy initially filed a Third Party Complaint against S&H Trucking and Worldwide Staffing. (Doc. 9.). In its Amended Third Party Demand, Entergy substituted Countrywide Payroll for Worldwide Staffing, and named Project RLM Consulting, LLC, Richard Morris, Design Air Systems and fleet Personnel Corporation as defendants. (Doc. 37).

2

The statute also provides that “[s]uch notice shall be reasonable, considering the work to be done-however, the notice shall not be less than forty-eight hours prior to the scheduled commencement of the work, exclusive emergencies, in which case the notice shall be made as soon as possible.” La. R.S. 45:143

3

Clardy v. Bruce Foods Corp is the only case where a court has interpreted the phrase “persons responsible for the work.”

4

Home Depot also argues that because the master services agreement at issue contains a forum selection clause that requires all disputes to be brought in Georgia and that it also requires that Georgia law apply in interpreting the contract, the request for a declaratory judgment should be dismissed. (Doc. 84-1 at p. 4-5). At this stage, the Court is limited to examining the face of the Complaint. The Complaint is silent as to a Georgia choice of law provision, and neither party attached the MSA to its filings. Ashcroft, 556 U.S. at 678. Therefore, the Court will not consider Depositors claims about a Georgia choice of law or forum selection clause at this stage of the proceeding.

5

Relevant here is the burden that will be imposed and expenses that will be incurred by the declaratory defendant if the action is allowed to proceed. USAA Cas. Ins. Co. v. Dydek, No. 5-CV-333, 2006 WL 3068890, at *3 (W.D. Tex. Sept. 27, 2006).

6

[Text Missing]

Court of Appeal of Louisiana,

First Circuit.

BIG 4 TRUCKING, INC. and Nationwide Agribusiness Insurance Company

v.

NEW HAMPSHIRE INSURANCE COMPANY

NUMBER 2017 CA 0420

|

Judgment Rendered: NOVEMBER 01, 2017

Appealed from the The Office of Workers’ Compensation, In and for the Parish of St. Tammany, Louisiana, Number 16–05319, District 06, Honorable Gwendolyn F. Thompson, Judge

Attorneys and Law Firms

Frank R. Whiteley, Robert J. May, Megan M. Richardson, New Orleans, Louisiana, Attorneys for Appellants, Plaintiffs—Big 4 Trucking, Inc. and Nationwide Agribusiness Insurance Company

Elizabeth A. Liuzza, Metairie, Louisiana, Attorney for Appellee, Defendant—New Hampshire Insurance Company

BEFORE: McCLENDON, WELCH, AND THERIOT, JJ.

Opinion

WELCH, J.

 

*1 **2 In this workers’ compensation matter, the plaintiffs, Big 4 Trucking, Inc. and Nationwide Agribusiness Insurance Company, appeal a judgment by the Office of Workers’ Compensation (“OWC”) sustaining a peremptory exception raising the objection of prescription and dismissing certain claims against the defendant, New Hampshire Insurance Company. For the reasons that follow, we reverse the judgment and remand this matter back to the OWC for further proceedings consistent with this ruling herein.

 

 

FACTUAL AND PROCEDURAL BACKGROUND

Successive Claims & Settlement

On March 27, 2014, Darrell Shanks sustained injuries as the result of an accident while in the course and scope of his employment with Big 4 Trucking, Inc. (“Big 4 Trucking”). At the time of Mr. Shanks’ 2014 accident, New Hampshire Insurance Company (“New Hampshire”) had in effect a policy providing workers’ compensation coverage to Big 4 Trucking. As per the policy, New Hampshire paid indemnity benefits and medical benefits in connection with Mr. Shank’s injuries. Relevant to the issues under consideration herein, New Hampshire made the last indemnity benefit payment to Mr. Shanks on April 25, 2014, and the last medical benefit was paid on behalf of Mr. Shanks by New Hampshire on August 12, 2014.1

 

On July 2, 2015, Mr. Shanks was involved in a second accident while still in the course and scope of his employment for Big 4 Trucking. At the time of the 2015 accident, Nationwide Agribusiness Insurance Company (“Nationwide”) **3 provided workers’ compensation insurance coverage to Big 4 Trucking. Nationwide paid approximately $22,500.00 in indemnity benefits and $52,991.55 in medical benefits on behalf of Mr. Shanks following the 2015 accident. Nationwide and Big 4 Trucking eventually entered into a settlement agreement with Mr. Shanks. As required by La. R.S. 23:1274, the settlement was approved by the workers’ compensation judge (“WCJ”) on June 17, 2016. Under the terms of the settlement agreement, Mr. Shanks expressly released Nationwide and Big 4 Trucking from any obligation to pay past or future indemnity benefits or medical benefits claims in exchange for a lump sum payment of $245,000.00.

 

 

Claim for Contribution—Exception of Prescription

On August 9, 2016, Big 4 Trucking filed a disputed claim for compensation urging the claim for contribution at issue in the instant appeal.2 On November 28, 2016, Nationwide was added as a named plaintiff via a second amended disputed claim for compensation. The attached petition for compensation alleged that Mr. Shanks sustained injuries in both the 2014 and 2015 accidents while in the course and scope of his employment with Big 4 Trucking. The complaint alleged solidary liability between all of the named parties on the basis that Mr. Shanks’ claims arising out of the 2015 accident resulted from an aggravation of the injuries he sustained in the 2014 accident. The contribution claim asserted was for one half of all workers’ compensation benefits and medical expenses paid by Big 4 Trucking and Nationwide in connection with Mr. Shanks’ job related accidents. New Hampshire answered and urged peremptory exceptions raising the objections of prescription and no right of action.

 

*2 **4 On December 5, 2016, a hearing was held on New Hampshire’s exceptions of prescription and no right of action. New Hampshire’s exception of no right of action was denied by the WCJ, and a judgment was signed on December 16, 2016. Regarding prescription, citing La. R.S. 23:1209 and Larkin v. Regis Hair Stylists, 2002–127 (La. App. 3rd Cir. 5/15/02), 817 So.2d 1266, New Hampshire argued a one year prescriptive period applied to all claims for contribution brought under the Workers’ Compensation Act. New Hampshire argued that the action for contribution was prescribed because the action was filed more than one year after New Hampshire had made its last payment of benefits to Mr. Shanks. The WCJ took the matter under advisement and issued a judgment signed December 20, 2016, and for the reasons argued by New Hampshire, sustained the exception of prescription and dismissed the claims against Nationwide with prejudice. We observe that the judgment signed December 20, 2016, addressed and ruled on only those claims asserted by Nationwide; thus, the claims asserted by Big 4 Trucking remain pending before the WCJ.3

 

Nationwide and Big 4 Trucking filed this devolutive appeal of the WCJ’s December 20, 2016 judgment, and assert that the WCJ erred as a matter of law in its finding that the claim for contribution “for supplemental earnings benefits and medical benefits paid to [Mr. Shanks] prescribed.” As noted herein, there is no final judgment against Big 4 Trucking; thus, we limit our opinion to Nationwide’s claims against New Hampshire on appeal.

 

 

**5 DISCUSSION

Exception of Prescription—Standard of Review and Burden of Proof

Generally, when evidence is introduced at the hearing on an exception of prescription, the WCJ’s findings of fact on the issue of prescription are reviewed under the manifest error-clearly wrong standard of review. See Carter v. Haygood, 2004-0646 (La. 1/19/05), 892 So.2d 1261, 1267. However, in a case involving no dispute regarding material facts, but only the determination of a legal issue, the reviewing court must apply the de novo standard of review. State by and Through Caldwell v. Fournier Industrie et Sante and Laboratories Fournier, S.A., 2015-1353 (La. App. 1st Cir. 12/22/16), 208 So.3d 1081, 1084; Cawley v. National Fire & Marine Ins. Co., 2010-2095 (La. App. 1st Cir. 5/6/11), 65 So.3d 235, 237; see also TCC Contractors, Inc. v. Hospital Service Dist. No. 3 of Parish of Lafourche, 2010-0685 (La. App. 1st Cir. 12/8/10), 52 So.3d 1103, 1108. Evidence in the form of a stipulation between the parties and a copy of the receipt and release agreement entered into between Mr. Shanks, Nationwide and Big 4 Trucking was entered into evidence at the hearing on the exception. However, the material facts of this case are not in dispute and the only issue is the legal issue regarding the proper prescriptive period applicable to contribution claims asserted between workers’ compensation insurers under La. R.S. 23:1209; therefore, we conduct a de novo review herein. Under the de novo standard of review the WCJ’s legal conclusions are not entitled to deference. See Kevin Associates, L.L.C. v. Crawford, 2003-0211 (La. 1/30/04), 865 So.2d 34, 43.

 

With regard to the burden of proof, if the facts alleged in a petition do not show that a claim has prescribed, the burden is on the party raising the objection of prescription to prove it. Conversely, if a claim is prescribed on the face of the pleadings, the burden is on the plaintiff to show that prescription has not tolled **6 because of an interruption or suspension of prescription. Gay v. Georgia–Pacific, 2012-1892 (La. App. 1st Cir. 10/10/13), 184 So.3d 39, 43; Brister v. GEICO Ins., 2001-0179 (La. App. 1st Cir. 3/28/02), 813 So.2d 614, 616. At the trial of a peremptory exception, evidence may be introduced to support or controvert any of the objections pleaded, when the grounds thereof do not appear from the petition. La. C.C.P. art. 931. Prescription statutes, including La. R.S. 23:1209, are construed to maintain rather than to bar actions. Albert v. Air Products and Chemicals, 2015-0525 (La. App. 1st Cir. 1/21/16), 186 So.3d 743, 748, writ denied, 2016-0630 (La. 5/20/16), 191 So.3d 1071.

 

*3 The facts alleged in the disputed and amended disputed claims for compensation do not show on their face that the claim for contribution has prescribed. Instead, the facts alleged in the disputed and amended disputed claims for compensation reference the dates of the 2014 and 2015 job related accidents, but there is no reference to the dates that disability benefit and medical expense payments were last made on behalf of Mr. Shanks by New Hampshire. As set forth in detail below, under La. R.S. 23:1209, the last date that indemnity and medical benefit payments were made serves as the definitive trigger for the running of prescription; therefore, without an allegation as to the date when prescription was triggered, the burden of proof remains with the mover, New Hampshire, to show that the claim against it is prescribed.

 

 

Louisiana Revised Statutes 23:1209

Louisiana Revised Statutes 23:1209 provides, in pertinent part, as follows:

1. (1) In case of personal injury, including death resulting therefrom, all claims for payments shall be forever barred unless within one year after the accident or death the parties have agreed upon the payments to be made under this Chapter, or unless within one year after the accident a formal claim has been filed as provided in Subsection B of this Section and in this Chapter.

(2) Where such payments have been made in any case, the limitation shall not take effect until the expiration of one year from the **7 time of making the last payment, except that in cases of benefits payable pursuant to R.S. 23:1221(3) this limitation shall not take effect until three years from the time of making the last payment of benefits pursuant to R.S. 23:1221(1), (2), (3), or (4).

(3) When the injury does not result at the time of or develop immediately after the accident, the limitation shall not take effect until expiration of one year from the time the injury develops, but in all such cases the claim for payment shall be forever barred unless the proceedings have been begun within three years from the date of the accident.

(4) However, in all cases described in Paragraph (3) of this Subsection, where the proceedings have begun after two years from the date of the work accident but within three years from the date of the work accident, the employee may be entitled to temporary total disability benefits for a period not to exceed six months and the payment of such temporary total disability benefits in accordance with this Paragraph only shall not operate to toll or interrupt prescription as to any other benefit as provided in R.S. 23:1221.

***

1. All claims for medical benefits payable pursuant to R.S. 23:1203 shall be forever barred unless within one year after the accident or death the parties have agreed upon the payments to be made under this Chapter, or unless within one year after the accident a formal claim has been filed with the office as provided in this Chapter. Where such payments have been made in any case, this limitation shall not take effect until the expiration of three years from the time of making the last payment of medical benefits.

 

According to La. R.S. 23:1209(A) and (B), a claim for indemnity benefits must be filed in the following time periods: (1) one year after the accident or death; or (2) one year after the last payment of indemnity compensation, except in claims for supplemental earnings benefits (“SEBs”), when the period of three years from the last weekly payment of indemnity benefits applies (regardless of the type of benefit previously paid); or (3) one year from the time the “injury develops” if the injury “does not result at the time of, or develop immediately after the accident,” but in no event more than two years after the accident. See Pal v. Stranco, Inc., 2010-1507 (La. App. 1st Cir. 8/3/11), 76 So.3d 477, 485, writ denied, 2011-1834 (La. 11/4/11), 75 So.3d 925. Similarly, under La. R.S. 23:1209(C), a claim for **8 medical benefits must be filed within the following time periods: (1) one year after the accident; or (2) three years after the last payment of medical benefits.

 

*4 Although the language of La. R.S. 23:1209 only discusses claims by or on behalf of an employee for indemnity and medical benefits, both this Circuit and the Third Circuit have held that the prescriptive periods found in La. R.S. 23:1209 are applicable to cross-claims between employers or workers’ compensation insurers for contribution. In the only two reported cases on the application of La. R.S. 23:1209 to contribution claims between insurers, TIG Ins. Co. v. Louisiana Workers’ Compensation Corp., 2009-0330 (La. App. 1st Cir. 9/11/09), 22 So.3d 981, and Larkin v. Regis Hair Stylists, 2002–127 (La. App. 3rd Cir. 05/15/02), 817 So.2d 1266, the First and Third Circuits concluded that the 1997 legislative amendment to La. R.S. 23:1310.3(E) granting original, exclusive jurisdiction to the WCJ over “cross claims between employers or workers’ compensation insurers for indemnification or contribution” results in the application of La. R.S. 23:1209 to such claims, because La. R.S. 23:1209 governs prescription on all claims brought under the Workers’ Compensation Act. See TIG Ins. Co., 22 So.3d at 986–987; Larkin, 817 So.2d at 1268.4

 

Additionally, Larkin and TIG Ins. Co. addressed how the prescriptive period in La. R.S. 23:1209 applies to contribution claims. In Larkin, an employee was injured on October 21, 1999, while in the course and scope of her employment with Regis Hair Stylists. On March 23, 2000, the employee filed a disputed claim for compensation and sought TTD benefits from Regis. Regis, in turn, filed a third party demand on February 2, 2001, against the employee’s previous employer, Books–A–Million, and its insurer, asserting the 1999 injury was a continuation, or, alternatively, an aggravation of a previous job related injury suffered by the **9 employee in 1996, during her employment with Books–A–Million. Larkin, 817 So.2d at 1266–1267.

 

Books–A–Million and its insurer filed an exception of prescription arguing a one year prescriptive period applied to Regis’ contribution claim under La. R.S. 23:1209. The Third Circuit agreed and held as follows:

The amendment to R.S. 23:1310.3(E) clearly granted original and exclusive jurisdiction of claims between insurers for contribution to the Office of Workers’ Compensation. R.S. 23:1209 provides that “all claims for payments shall be forever barred” unless brought within one year. R.S. 23:1209 does not grant any exceptions or extensions for a contribution claim filed by an insurer against another beyond the one year period.

Larkin, 817 So.2d at 1268.

 

As noted above, the WCJ relied upon the Third Circuit’s holding in Larkin to find that Nationwide’s contribution claim was prescribed. In its written reasons for judgment, the WCJ found that the prescriptive period for Nationwide’s contribution claim ran one year from the date of the last workers’ compensation benefit payment by New Hampshire. The WCJ’s interpretation of La. R.S. 23:1209 did not appear to distinguish between claims for certain types of indemnity benefits and/or medical benefits. New Hampshire argues that Larkin is controlling here and mandates the application of a one year prescriptive period to all contribution claims regardless of whether the claims relate to the payment of indemnity or medical benefits. New Hampshire takes the position that only express claims for SEB benefits or medical benefits by or on behalf of an employee claimant would be subject to the three year prescriptive period set forth in La. R.S. 23:1209(A) and (C).

 

*5 Nationwide maintains that the instant matter is governed by this court’s holding in TIG Ins. Co. Nationwide avers that under the holding of TIG Ins. Co., any contribution claims for SEBs or medical benefits paid by Nationwide and Big 4 Trucking would be subject to a three year prescriptive period that runs from **10 the last date of the payment of the benefit in question by New Hampshire. Nationwide contends that its claim for contribution was timely filed less than three years after New Hampshire’s last benefit payments. Nationwide asserts that the WCJ erred in dismissing its contribution action as there was no determination by the WCJ whether SEBs or medical benefits had been paid by Nationwide or Big 4 Trucking prior to dismissing the entire claim on the grounds that it was prescribed.

 

In TIG Ins. Co., the employer had two overlapping policies in effect at the time of the employee’s injury, one through TIG, and the other through Louisiana Workers’ Compensation Corporation (“LWCC”). TIG paid the indemnity and medical benefits in connection with the employee’s claim, and eventually settled with the employee. TIG Ins. Co., 22 So.3d at 983. The last payment of benefits by TIG to the employee was on July 9, 2002. More than three years later, on April 25, 2006, TIG sued LWCC for contribution for one half of TIG’s expenditures associated with the settlement and handling of the claim. TIG alleged solidary liability on the basis of overlapping coverage. The WCJ sustained LWCC’s exception of prescription and found that TIG’s contribution claim was prescribed under La. R.S. 23:1209. Id.

 

Recognizing the issue as res nova, this Court first reviewed and adopted the reasoning set forth by the Third Circuit in Larkin holding that La. R.S. 23:1209 governs the time for filing cross claims for employers and insurers for contribution. Id. at 986. However, this Court did not find that Larkin established a blanket one year prescriptive period for all contribution claims. Instead, this court in TIG Ins. Co. found that application in Larkin of the one year prescriptive period found in La. R.S. 23:1209 was appropriate therein because the only claim at issue in Larkin was a contribution claim for TTD benefits. See Larkin, 817 So.2d at 1267. This court explained:

**11 As the claim in Larkin was a claim for temporary total disability benefits, the one-year prescriptive period of La. R.S. 23:1209 was clearly applicable. However, as previously noted, there are different prescriptive periods applicable for supplemental earnings benefits and medical benefits that were not at issue in Larkin.

Id. at 987, n.5. To that end, this Court held that the contribution claim for TTD asserted by TIG were prescribed under the La. R.S. 23:1209. Id. at 988. However, this Court then observed that under La. R.S. 23:1209(A) and (C), TIG “would have had up to three years” from the last date of payment for any SEB and medical benefits to file a claim for contribution against LWCC. Id. The Court observed that the record was not clear as to what types of benefits had been paid by TIG in the settlement with the employee. This Court then found that TIG’s claim for contribution was prescribed on its face because it was filed more than three years after the payment was made; however, the Court observed that prescription may have been interrupted by the initial filing of suit in the district court. Id. The Court remanded the matter back to the OWC to determine whether prescription had been interrupted as to any claims related to SEB and the medical benefits. Id. at 989.

 

New Hampshire’s principal argument is that Larkin establishes a blanket one year prescriptive period for all contribution claims whether the claims be for indemnity benefits or medical benefits. We disagree. Instead, we find that this court in TIG Ins. Co. correctly observed that the holding of Larkin is limited to the one year prescriptive period applicable to contribution claims for TTD benefits. We also agree with the finding in TIG Ins. Co. that Larkin did not consider the application of La. R.S. 23:1209 to contribution claims related to SEBs or medical benefits. Based on our reading of this court’s holding in TIG Ins. Co. and La. R.S. 23:1209, we conclude that a party can file a contribution claim for SEBs and medical benefits up to three years from the last payment of indemnity or medical benefits by a party against whom indemnity is sought.

 

*6 **12 Here, Nationwide’s claim for contribution asserts that New Hampshire owes contribution for one half of the sums that were paid to Mr. Shanks. The receipt and release dated June 8, 2016, that was entered into evidence at the hearing on the exception of prescription provides that the $245,000.00 paid releases Nationwide and Big 4 Trucking from liability for all sums arising out of the July 2, 2015 accident, including compensation benefits and medical benefits. However, the terms of the receipt and release are fairly general and provide no indication as to whether the compensation benefits paid represent SEBs. Attached to New Hampshire’s exception of prescription is a copy of the petition for settlement filed jointly by Mr. Shanks and Nationwide seeking approval by the WCJ for the settlement as required by La. R.S. 23:1274. The petition for settlement asserts that $22,500.00 in “compensation benefits” and $52,991.55 in “medical benefits” had been paid by Nationwide and Big 4 Trucking to Mr. Shanks prior to reaching the settlement. With regard to the lump sum settlement of $245,000.00, the petition for settlement asserted that $195,000.00 of the total represented “future indemnity benefits” and “substitutes for a payment of $480.77 per month of periodic indemnity compensation benefits” for the duration of a period 405.6 months (a negotiated time period).5

 

From the information in the record, it is clear that Nationwide paid medical benefits to Mr. Shanks for which it now seeks contribution from New Hampshire. Based on the reasoning set forth in TIG, we find Nationwide timely filed its contribution claim for medical benefits within three years from the last payment by New Hampshire; therefore, the WCJ legally erred in holding that this claim was prescribed. Further, we find that the mover, New Hampshire, failed to carry its burden of proof that prescription had run as to any SEB benefit claims. The **13 record, including the petition for settlement and the receipt and release, suggests that Nationwide may have paid SEB payments to Mr. Shanks within the three year prescriptive period. Based on the above, we find that the WCJ erred in sustaining the exception of prescription and dismissing Nationwide’s entire claim for contribution with prejudice.

 

 

CONCLUSION

For the above and foregoing reasons, we reverse the judgment signed on December 20, 2016 sustaining the peremptory exception raising the objection of prescription filed by New Hampshire Insurance Company and dismissing the contribution claim filed by Nationwide Agribusiness Insurance Company. We remand the matter for further proceedings consistent with this opinion and note that any contribution claims not subject to the three year prescriptive period in La. R.S. 23:1209 are prescribed. All costs associated with this appeal are assessed against New Hampshire Insurance Company.

 

REVERSED, MATTER REMANDED.

 

All Citations

— So.3d —-, 2017 WL 4973110, 2017-0420 (La.App. 1 Cir. 11/1/17)

 

 

Footnotes

1

We note an inconsistency throughout the record regarding the last date that New Hampshire made benefit payments to Mr. Shanks. At various places in the record, New Hampshire asserts that the last indemnity payment was made to Mr. Shanks on April 22, 2014 and the last medical benefit was paid on May 9, 2014. However, at the December 5, 2016 hearing on New Hampshire’s exceptions, the parties stipulated that the last indemnity benefit was paid on April 25, 2014 and the last medical benefit on August 12, 2014. We adopt the later dates as those dates were stipulated to by the parties at the December 5, 2016 hearing.

2

In the initial disputed claim for compensation, Big 4 Trucking erroneously named “AIG Claims, Inc.” as the defendant in the matter. In its answer, New Hampshire appeared and noted Big 4 Trucking’s error in naming AIG Claims, Inc. in the disputed claim for compensation. The error was eventually corrected by an October 18, 2016 order granting Big 4 Trucking’s motion for partial dismissal seeking the dismissal of AIG Claims, Inc. On November 11, 2016, Big 4 Trucking sought and was granted leave to file a first amended disputed claim for compensation that formally named New Hampshire as the sole defendant.

3

While we find that the judgment signed December 20, 2016 is a final judgment as to Nationwide under La. C.C.P. art. 1915(A)(1), we find that there is no final judgment against Big 4 Trucking presented for this court’s consideration on appeal. Review of the transcript reveals that the plaintiffs, Big 4 Trucking and Nationwide, were represented by shared counsel at the December 5, 2016 hearing; however, the December 20, 2016 judgment makes no reference to Big 4 Trucking in the body of the judgment or render any type of judgment with regard to Big 4 Trucking. Since there is no final judgment in the record dismissing Big 4 Trucking’s claims against New Hampshire, we are constrained to find that the claims asserted by Big 4 Trucking remain pending.

4

In the absence of legislative action specifically addressing prescriptive periods for contribution claims between employers or workers’ compensation insurers, we are constrained to continue to apply La. R.S. 23:1209 to cross claims between employers or insurers for contribution or indemnity.

5

The Louisiana Revised Statutes do not recognize a “periodic indemnity compensation benefit,” and at oral argument before this Court, the parties categorized the payment of $480.77 identified in the motion to settle as an SEB. As noted herein, the nature of indemnity benefits paid for purpose of determining which claims are prescribed can be determined on remand.