UM Waiver Completed by Insured’s Assistant Found Invalid

A recent decision from the Louisiana Third Circuit Court of Appeal re-affirms the merchant liability rules. In Carolyn R. Miller and Steven Rathjen v. Willis Communications, et. al., 19-787 (La. App. 3 Cir. 6/24/20), the plaintiff was an elderly patron of an AT&T store. Plaintiff and her daughter were assisted at the customer service desk, and plaintiff took a seat in a rolling chair. When she attempted to stand up, the rolling chair moved, and she fell to the floor breaking a hip.

Plaintiff filed suit under the merchant’s liability statute, La. R.S. 9:2800.6. Per the statute, if a negligence claim is brought against a merchant by a person lawfully on the merchant’s premises for injuries sustained because of a fall, then plaintiff must prove: 1) that the condition of the merchant’s premises presented an unreasonable risk of harm that was reasonably foreseeable; 2) that the merchant created the risk or had actual or constructive knowledge of the condition; and 3) that the merchant failed to exercise reasonable care to address the unreasonable risk of harm. Plaintiff argued that an unreasonable risk of harm was created when she was given a chair on rollers on flooring allegedly unsafe for use with a rolling chair.

The defendants filed a motion for summary judgment, which was denied by the trial court. The appellate court reversed and entered summary judgment. The appellate court found that the critical element of plaintiff’s burden of proof was missing – any defect in the rolling chair. Plaintiff admitted that the chair was not defective. Instead, she argued that she should not have been given a rolling chair to sit in because of her age, obvious mobility issues, and because the rolling chair was unsafe on the flooring of the store.

Evidence was presented that: 1) plaintiff’s daughter was able to maneuver the rolling chair without incident; 2) the daughter did not believe that plaintiff would have trouble navigating the rolling chair; and 3) no other customer had ever fallen out of one of the rolling chairs. Simply, what occurred at the AT&T store was an accident, for which AT&T and its employees were not responsible. Plaintiff, well aware of her own physical limitations, chose to sit in a rolling chair that she physically was unable to get out of on her own. Based upon this evidence, the court reasoned that plaintiff did not prove that: 1) the rolling chair posed an unreasonable risk of harm; or 2) the merchant possessed actual or constructive knowledge of any defect.

Following decisions which imposed harsh standards upon retailers, the Louisiana Legislature adopted the merchant’s liability statute to limit recovery to cases involving true negligence. The Carolyn R. Miller decision demonstrates that the statute is properly used in motion practice to resolve cases where the merchant lacks advance knowledge of the claimed unreasonable risk. Sometimes, an accident is just an accident.

Virginia “Jenny” McLin is a partner at Keogh Cox who practices in the fields of corporate litigation, insurance defense and workers compensation defense. When she is not practicing law, Jenny can be found volunteering with the Junior League of Baton Rouge; cheering for the LSU Tigers with her husband Ryan; or shuffling her two kids to and from dance practice.

As the old adage goes, it’s always safest to get an agreement in writing. In Louisiana, when an agreement is about the sale of real estate, the adage is law. A contract for sale must be in writing as provided in Louisiana Civil Code articles 1839 and 2440.

This long-standing rule was at issue in the recent case of Holmes v. Paul, 19-130 (La. App. 5 Cir. 10/2/19), 279 So. 3d 1068. In Holmes, the plaintiff/seller and defendants/purchasers entered into a purchase agreement for a Metairie home which required a closing by no later than April 29, 2016. The contract was a standard form Louisiana purchase agreement which required that any change in the closing deadline be written and signed by both parties. The parties later entered a written extension of the closing deadline to May 6, 2016.

Three days before the closing, the home appraised for $14,000 below the purchase price, leading the seller’s agent to encourage the purchasers’ agent to pursue an appraisal review. However, the parties did not sign a written extension of the May 6, 2016 closing deadline. Thereafter, the seller agreed to decrease the purchase price to the appraised value, but on the same day the purchasers sent a signed cancellation. The seller sued the purchasers for breach of contract, arguing that the parties verbally agreed to extend the closing deadline and intended to execute a written extension as soon as they determined a feasible closing date.

The purchasers moved for summary judgment on the ground that the purchase agreement had expired and was unenforceable. The Court agreed. The purchase agreement expressly required that extensions be made in writing signed by both parties. Upon the expiration of the May 6, 2016 closing deadline, the contract was unenforceable.

The seller also asserted a detrimental reliance claim, arguing she was lulled into not insisting on a written extension because the purchasers’ agent agreed to it orally. However, the seller conceded her awareness that an extension had to be in writing. As such, her reliance was not reasonable. The court further noted the absence of evidence that the purchasers themselves agreed to orally extend the contract or to waive the writing requirement.

Unfortunately, business deals in the modern world cannot be finalized by a handshake. Remember that when you buy and sell property in Louisiana -- get it in writing.

Marty Golden has been practicing law based in Baton Rouge, Louisiana for over thirty years, concentrating in civil litigation primarily involving injuries, property damage, insurance coverage, and contract disputes. Much of his practice is defending and advising real estate agents in suits by property buyers and sellers, but Marty also defends other professionals, insurance companies, manufacturers, and business owners. Marty has a special interest in all things procedural, because they are the rules of the road for litigators and knowing them better than his opponent gives him a leg up in court.

For decades, Louisiana law provided a claimant or injured person an uncommon opportunity (1) to directly name an insurer in a lawsuit, and (2) to make the jury aware of the presence of insurance. This was known nationally as the “Louisiana Direct Action Statute.” This statute, embodied in LSA—R.S. 22:1269, has long been a topic of debate.

The Louisiana Legislature recently amended the “direct action statute” in Act 275 and declared that the injured person “shall have no right of direct action against the insurer” unless at least one of the exceptions applies: the insured files for bankruptcy, the insured is insolvent, service cannot be made on the insured, a tort cause of action exists against a family member, uninsured motorist claims, the insured is deceased, or when the insurer issues a reservation of rights or coverage denial (but only for the purpose of establishing coverage). The Act further provides that the insurer shall not be included in the caption of the case. And, the existence of insurance is not to be disclosed unless the Louisiana Code of Evidence requires it. This new legislation is effective August 1, 2024.

But, the Act also provides for new provisions that allow for the joinder of an insurer after settlement or in connection with a final judgment. The Act further includes specific provisions enacted to provide notice to an insurer of an action and outlines the procedures and timelines for how insurers assert reservation of rights or a denial of coverage.

The revisions to LSA—R.S. 1269 represent a significant change in how lawsuits involving insurance companies will proceed.