You’ve Been Served – Now What? Understanding “Louisiana’s Pre-trial Procedure”

Louisiana is a river delta state filled with fertile land and the refusal of its local fauna to stay within boundaries is a problem. Trees create hazards. They also bring nuisance in all its forms––pine sap drizzled over a new car, an oak branch casting a sun-blocking shadow over the perfect tanning spot, and on and on. If you own the tree, the problem is easy enough to address; but what if the tree belongs to your neighbor? Can you cut your neighbor’s tree?

While the Louisiana Civil Code provides guidance, it does not answer every question. Under the Civil Code, “a landowner has the right to demand that the branches or roots of a neighbor’s trees, bushes, or plants, that extend over or into his property be trimmed at the expense of the neighbor.” La. Civil Code Art. 688. Nevertheless, the right to "demand" that the problem be addressed is not a “license to cut;” and does not permit a landowner to cut without permission. Kahl v. Luster, 110 So.3d 1101 (La. App. 1 Cir. 12/28/12).In the event a neighbor is less than neighborly and refuses to trim back a trespassing branch, a landowner may bring an "injunction" against his neighbor. Such an action was involved in Scott v. Ramos, 399 So.2d 1266 (La. App. 4 Cir. 1981) where the defendant/neighbor's large oak tree extended over the plaintiff's property and deposited leaves and branches onto his roof and into his yard. In defense of the action, the defendant presented evidence that cutting the tree back to the property line would essentially kill the tree. Over these objections, the Louisiana Fourth Circuit Court of Appeal granted plaintiff a permanent injunction which required the defendant neighbor to “keep the tree, its limbs and branches cut” back to the property line. Further, the court ordered that defendant reimburse the plaintiff for the cost of removing leaves and fallen debris once a year.So, should your neighbor’s tree ever present a hazard or impede on the enjoyment of your property, there are means of relief. However, gassing up your chainsaw, without your neighbor’s permission, is not one of them.

Many insurance policies contain a Concealment or Fraud provision that provides no coverage where the insured concealed or misrepresented any material fact or circumstance, engaged in fraudulent conduct, or made false statements related to the insurance.

But will a court enforce the Concealment or Fraud provision to deny an insured recovery on an otherwise covered peril? According to a recent decision out of the Eastern District of Louisiana, the answer is YES.

In Fahimipour v. United Property & Casualty Insurance Company, the plaintiffs sought contractual and extra-contractual damages from their insurance carrier for damages to their residential property allegedly sustained during Hurricane Zeta. After a bench trial, Judge Morgan concluded Plaintiffs’ application for insurance included a false statement made with knowledge of its falsity and voided the insurance policy from inception, in its entirety.

Citing Talbert v. State Farm Fire & Cas. Ins. Co., the Fahimipour court noted that “Under Louisiana law, an insurance policy is voided entirely and from its inception when the insured makes a material misrepresentation in the application for insurance with the intent to deceive the insurer.” The insurer must prove by a preponderance of the evidence the following elements in order to succeed on such a claim:

(1) the insured made a false statement;

(2) the false statement was material; and

(3) the false statement was made with intent to deceive.

With regard to the first factor, the Court found the insureds obtained and read an inspection report in connection with their purchase of the property. They “were concerned enough about the findings of the inspectors to contact their real estate agent” about the issues. The insureds represented in their insurance application that the property was well maintained, and free of damage, debris, and liability hazards, despite the extensive contradictory findings in the inspection report.

Regarding the second element, the carrier’s in-house expert testified that the insurer would not have bound coverage if the application contained the information from the inspection report. Therefore, the court found the insured’s false statements were material.

The third element – intent to deceive – “must be determined from the surrounding circumstances indicating the insured’s knowledge of the falsity of the representations made in the application and his recognition of the materiality of his representations, or from circumstances which create a reasonable assumption that the insured recognized the materiality.”

In finding the insurer established the third element, the Court noted the insureds were “sophisticated users of insurance.” Evidence showed the insureds previously purchased houses for renovation and resale, owned multiple properties, submitted insurance applications before, and also submitted claims for coverage on at least three prior occasions.

Ultimately, the Court denied plaintiffs any recovery for alleged hurricane damages because of the misrepresentations they made in their application for insurance coverage.

Prior to Fahimipour,Courts had found that post-loss misrepresentations may also void a policy. In Roach v. Allstate Indem. Co., 476 Fed. App’x 778, 779 (5^th Cir. 2012), the plaintiff’s house was damaged in a fire. The Fifth Circuit upheld a summary judgment that voided the plaintiff’s policy after he submitted a falsified claim that included contents not located on inspection following a fire at the residence.

The policy at issue in Roach included a similar Concealment or Fraud provision that stated the policy would provide no coverage if the insured misrepresented any material fact before or after a loss. In granting summary judgment, the district court applied the same three factors used in the Fahimipour case to find the plaintiff made material misrepresentations in his personal property claim when he claimed items not located on inspection.

While the policy in Fahimipour was voided in part because the insureds were “sophisticated users of insurance,” it remains to be seen whether a Louisiana court will void coverage based on a similar provision brought by a less sophisticated insured under a different set of facts.

However, the Fahimipour and Roach decisions show that a court can void a policy, from its inception, because of an insured’s misrepresentations, whether they occur in connection with the application for the policy or after a loss. These rulings also suggest that Louisiana law recognizes an insured also has a reciprocal duty of good faith in its relationship with its insurer.

Case References: Behnaz Fahimipour, et al. v. United Property & Casualty Insurance Company, 2022 WL 16833693 (E.D. La. Nov. 9, 2022); Roach v. Allstate Indem. Co., 476 Fed. App’x 778, 779 (5^th Cir. 2012); Talbert v. State Farm Fire & Cas. Ins. Co., 971 So.2d 1206 (La. App. 4 Cir. 2007).

As part of the unique aura that surrounds Mardi Gras inSouth Louisiana, the expression “Laissez les bons temps rouler” is foreverlinked to the spirit of the season. The Cajun French phrase meaning “Let thegood times roll” captures the eccentric soul of Carnival. However, it might bedifficult to let the good times roll after being struck by a bag of beadshurled from the second deck of float. If the spectator suffers a severe injuryas a result, who is liable? Does the injured party have any recourse againstthe person who threw the beads? Against the Mardi Gras krewe organizers?

The Fourth Circuit Court of Appeal held that spectatorsassume the risk of injury when attending a parade. Citron v. Gentilly CarnivalClub, Inc., 14-1096 (La. App. 4 Cir. 4/15/15), 165 So.3d 304. The foundation ofthe decision was based on the Mardi Gras Immunity Statute, La. R.S. 9:2796,which has two parts: (1) creates broad immunity for krewes which sponsorparades; and (2) states that anyone who attends such a parade “assumes the riskof being struck by any missile whatsoever which has been traditionally thrown,tosses or hurled by members,” which include, but are not limited to: beads,cups, doubloons, and many other things.

To impose liability on a krewe, there must be evidence ofthe krewe’s—as opposed to its member’s—gross negligence. Palmer v. Zulu Soc.Aid & Pleasure Club, Inc., 09–0751 (La. App. 4 Cir. 3/1/10), 63 So.3d 131(emphasis added). Furthermore, a carnival krewe or organization may not bevicariously liable for its members' acts. To the contrary, Louisianajurisprudence has rejected the argument that a krewe is vicariously liable forits members' acts. Kibble v. B.P.O. Elks Lodge No. 30, 640 So.2d 267, 269 (La.App. 4th Cir. 1993).

The Mardi Gras Immunity Statute imposes an extremely high burden of proving the “loss or damage was caused by the deliberate and wanton act or gross negligence” of the krewe or organization. Gross negligence has been defined as the “entire absence of care” and an “extreme departure from ordinary care or the want of even scant care.” Ambrose v. New Orleans Police Department Ambulance Service, 93–3099 (La. 7/5/94), 639 So.2d 216. In calculating whether an act was grossly negligent in the context of Mardi Gras Immunity Statute, the Citron court considered several factors: (1) the weight of the object thrown, (2) the distance the object was throw, and (3) the manner in which the object was thrown. Citron, 165 So.3d at 317.

Ultimately, the statute absolves krewes from liability for injuries caused by objects thrown to parade spectators, except in extreme and unusual circumstances. Therefore, be alert during parades this Mardi Gras season and Laissez les bons temps rouler.

Cole Frazier joined Keogh Cox as an associate in 2019 after working at the firm as a law clerk during law school. He earned his J.D. and Diploma in Comparative Law from Louisiana State University, Paul M. Hebert Law Center. During his time at LSU Law, he also studied comparative law at Jean Moulin Lyon 3 University in Lyon, France. Cole received his Bachelor’s degree in Business Administration with a concentration in Pre-law from Nicholls State University in 2015. He was elected to the Southland Conference all-academic team twice as a member of the Nicholls State football program.