Trial Court Errs by Granting an Exception of Prescription to Insurance Company

clocks_clock_time_watch-scaledPrescription. Some may relate this term to the medical field and taking pills. But in Louisiana, it has an entirely new meaning. Think of the common phrase “the statute of limitations” many other states use. It’s just like that. A limit is set that blocks claims from being brought after a certain amount of time has passed from the original incident. In this case, the Fifth Circuit Court of Appeal addresses whether an insurance company’s peremptory exception of prescription could be sustained. 

On July 21, 2012, Michael Jones rear-ended Carlos Russell (“plaintiff”) while both vehicles were parked, waiting to unload their dump trucks in Belle Chasse, Louisiana. At the time of the incident, Jones was within the scope of employment with Riley & Carroll Properties (“R & C”).  Determining the scope of employment is important because an employee can only collect worker’s compensation benefits for any injuries that arise within the scope of employment. After the accident, State National Insurance Company (“SNIC”) paid Carlos Russell $8,738.52 for property damage to his vehicle.

Exactly one year later, on July 21, 2013, Russell filed a personal injury claim against R & C, Jones, and SNIC. Later, Russell amended the lawsuit to include his own insurance company and Ernest Riley, the trucking company’s owner, as defendants. It was found later in 2017 that Scottsdale Insurance Company carried general liability insurance coverage for Jones, Riley, and R & C. That meant that Russell could also add Scottsdale as another defendant to the claim.

On June 2, 2017, Scottsdale filed a preemptory exception of prescription. An exception of prescription, in the state of Louisiana, refers to the amount of time within a certain period where a person may file a lawsuit. It’s very similar to a more well-known term we call statute of limitations. Scottsdale claimed that because the claim was filed over a year after the default judgment against them had been completed, the claim could not be brought. A default judgment is where there is a failure to fulfill a legal obligation. 

At the trial court level, the court found the exception of prescription was warranted because more than a year had passed between the default judgment and the filing of suit against Scottsdale in March of 2017 for an action that occurred in 2012 and, therefore, sided with Scottsdale. Russell appealed this and went to the Fifth Circuit Court of Appeal to address the claim that the trial court erred in concluding the exception of prescription was warranted.

The appellate court looked to see if Russell filed the suit against SNIC within the correct timeframe that interrupted prescription against Scottsdale. Per La. C.C. art. 3492, delictual actions are subject to a liberative prescriptive period of one year, which begins to run from the day injury or damage is sustained. Similarly, the court notes that if prescription is evident in the beginning of the pleadings, the burden shifts to the plaintiff to show the action has not prescribed. Campo v. Correa,

The court held that because the plaintiffs were not given sufficient discovery to bear the burden, the claim had not prescribed. This includes plaintiffs determining which insurance company was the defendants’ insurer when the incident occurred and whether the two insurers had a relationship. Ultimately, the appellate court sided with Russell and held that Scottsdale’s exception of prescription was premature.

It’s never easy to go through lawsuits. They can be timely, cumbersome, and just plain confusing. But don’t let that fear or worry keep you from filing a lawsuit if you think you’ve been unjustly treated. Immediately hire an experienced attorney who can file the lawsuit promptly and win your case without worrying about the time limits to bring your claim.


Written by Berniard Law Firm Writer Brianna Saroli

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