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Insight
Did You Just Create a Contract?
You tell a contractor you want him to repair a problem. Before leaving your house, the contractor says he will “look into it” and “get back to you.” Have you just made an oral contract for the repair? The answer to this question is no, according to Hodson v. Daron Cavaness Builder, Inc., 2017-1235 (La. App. 1 Cir. 2/27/18), a recent First Circuit Decision.
In Louisiana, an oral contract for over $500 must be proved by at least one witness and other corroborating circumstances. See La. C.C. art. 1846. The person trying to enforce the oral contract may serve as her own witness to meet this standard, but evidence of the corroborating circumstances must come from some other source. In Hodson, the plaintiff observed cracks in her floor and called a contractor to examine the problem. The plaintiff made it clear she wanted the contractor to repair the floor. While the contractor denied promising to fix the floor, he admitted that he promised to “look into it and get back with her in a week or two.” Despite his promise, he never called the homeowner back.
The plaintiff filed suit and claimed she was entitled to recover damages for the cost of repairing her floor. The Trial Court found the contractor’s admissions to be enough “corroborating evidence” to establish an oral contract for the repair. However, the First Circuit found the parties did not make an oral contract to repair the floor. Instead, the contractor only agreed to “look into it.” According to the Hodson Court, a “broken promise to look into a situation does not equate to an oral agreement to repair.”
The Hodson decision shows that while Louisiana law allows parties to create oral contracts, it can be difficult to prove that a contract was actually formed or to define the details of the agreement. If you put the agreement in writing, you won’t be left wondering whether you just created a contract.
Reynolds LeBlanc is a partner at Keogh Cox. His practice areas include commercial litigation, personal injury claims, appeals, and other matters. Reynolds is a former teacher, who in his free time plays music and perpetually talks himself into training for his next marathon.
Contracts
Insight
Distracted Driving: More, and More Severe, Accidents
**If you’re reading this article while driving, stop reading or driving - your choice**
Distracted driving is dangerous and can lead to an accident. Everyone knows this now. But one factor that appears to have gone unnoticed by the public at large is that distracted driving not only results in more automobile accidents, but often causes accidents which are more severe. The reasons why are becoming clear to insurance carriers who write automobile liability policies.
In a January 2017 "earnings call," Travelers Insurance observed that it was detecting a higher percentage of car crashes at higher speeds. Simple physics shows that higher speeds bring higher forces, and increase the risks involved. Research has shown that sending or reading a text takes your eyes off of the road an average of 5 seconds. If correct, at 55 mph, you will travel 403 feet while not looking at the road. Often times, a driver, even if they cannot avoid an accident, can do something to minimize the consequences, such as braking or taking a better angle to protect the driver or the passengers.
The fact that an insurance company is able to detect an increase in the severity of accidents, in an age where cars are safer than ever before, is something we should all consider.
Brian Butler is a partner with Keogh Cox. With over 30 years of experience, Brian has handled all types of defense matters. In recent years, his practice has been focused on cases involving complex cases with serious injuries and damages, which has led to extensive work with experts in complex cases, fire cases, and cases involving extensive forensic investigation. In his free time, Brian enjoys traveling with his wife.
Insurance
Insight
Leave Different: Gasquet Agreements and What Insurers Need to Know
As part of its travel pitch, Louisiana tourism once used the slogan: “Louisiana. Come as you are. Leave different.” If an out-of-state insurer writes in Louisiana and does not understand the ramifications of “Gasquet,” then they may leave different, very different.
The term “Gasquet” comes from the case of Gasquet v. Commercial Union Ins. Co., 391 So. 2d 466 (La. App. 4th Cir. 1980). The case considered how a settlement of the plaintiff's claims against the primary carrier and a partial settlement of claims against the tortfeasor/insured impacted the excess carrier.
In Gasquet, the plaintiff alleged serious personal injury. Prior to trial, he settled with the primary insurer, Commercial Union, for $200,000, even though it had a $300,000 policy limit. In the deal, the plaintiff fully released Commercial Union. He also released the tortfeasor/insured from all liability not insured by the excess carrier, Stonewall Insurance. The insured therefore remained in the lawsuit as a “nominal defendant” to allow the plaintiff to pursue the excess carrier.
After settlement, the excess carrier denied the claim and asserted that payment by the primary carrier of less than policy limits did not trigger its policy, which required that the primary policy be "exhausted." Without exhaustion, the excess carrier argued that it could not be called upon to respond under its policy language. The court rejected this argument and held that the plaintiff was entitled to a direct action against the excess carrier who would, in turn, receive a credit for the full limits of the primary policy. The “Gasquet release” has since become a staple of Louisiana litigation.
In Louisiana, unlike many states, a primary insurer owes no general duty to the excess carrier under Great Southwest Fire Ins. Co. v. CNA Insurance Companies, 557 So. 2d 966 (La. 1990). This creates a dynamic not present in states where the primary carrier is duty bound to consider the interests of the excess carrier. This lack of duty magnifies the vulnerability of the excess carrier’s position in Gasquet-friendly Louisiana.
An excess carrier in Louisiana should measure its reliance upon a primary carrier who can independently settle out with the plaintiff, sometimes on the eve of trial. If the excess carrier relied upon the primary carrier to defend the case, the excess carrier could be placed in the unenviable position of scrambling to defend a case where the insured (protected by Gasquet) may be suddenly disinterested in the outcome. Excess carriers with real potential exposure need to stay involved in the litigation and be prepared.
Following Gasquet, permutations have developed such as a “reverse-Gasquet,” where the excess carrier settles with the plaintiff and then pursues the primary insurer to recoup its payment. So, come to Louisiana, but know that we are sometimes different.
Collin LeBlanc is a Keogh Cox partner and experienced litigator who concentrates in injury, commercial, and legal malpractice disputes. He lives in nearby Zachary, Louisiana with his wife Melissa and three all-too-active children. He is an outdoorsman, a tennis player, a cook, and a hobbyist writer.
Insurance
Louisiana
Insight
Who’s Left Holding the Bag? Indemnity in Construction Contracts
The period of time before the contract is signed in one of optimism. After all, few sign a contract expecting problems. But if you do not consider the many "what ifs," you may be left holding the bag. And this "bag" may include indemnity provisions which could force you respond for the actions of other parties.
Many contracts include "indemnity" or "hold harmless" provisions. Black's Law Dictionary defines indemnity as "a duty to make good any loss, damage, or liability incurred by another." Like many states, Louisiana allows one party to agree to pay for the damages caused by the fault of the other, if this intention is sufficiently expressed. However, there are broad statutory exceptions that can nullify the indemnity requirement.
Parties to construction contracts should be careful not to blindly rely upon indemnity provisions because the Louisiana legislature in La. R.S. 9:2780.1 declared invalid any indemnity provision where a party seeks indemnity from another for its own fault.
Despite the broad nullification of certain types of indemnity provisions in construction contracts, current Louisiana law allows a party to be indemnified for its own fault when the other party obtains insurance to cover the risk, and recovered the cost of insurance in the contract price. For example, a general contractor can require a subcontractor to indemnify the general contractor for the general contractor’s fault, as long as the subcontractor obtains insurance for this obligation, and was paid that amount under the contract.
Indemnity obligations are not always as they seem. Even in the pre-contract period of optimism, you may want to contact an attorney so you won't be left holding the bag.
Chelsea Payne is an associate at Keogh Cox and has been practicing for three years. Her practice mainly relates to construction law and complex litigation. Chelsea enjoys playing tennis and spending time with her family.
Construction
Louisiana
Indemnity
Insight
Is Your Neighbor a Nuisance?
The poet Robert Frost famously wrote that: “Good fences make good neighbors.” But what if there is a problem even fences won’t solve? Louisiana law offers some answers.
Under Louisiana law, a landowner cannot use their property in a manner that interferes with their neighbor’s enjoyable use. While a neighbor may have to put up with some inconveniences, excessive inconveniences that cause damage may be actionable. If a landowner’s activity is considered a nuisance, he may be liable for damages, and the court may require the landowner to stop the activity.
To determine whether a particular activity is considered a nuisance, courts look to the following factors: (1) the character of the neighborhood; (2) the degree of the intrusion; and, (3) its effect on the use and enjoyment of neighboring properties. For example, a person living in a heavy industrial area may have to put up with more noise than someone living in the suburbs. Whether activity is considered a nuisance is determined on a case-by-case basis.
Further, the nature of the noise and its persistence and duration can be a factor in determining whether the activity is a nuisance. For example, in Parish of E. Feliciana ex rel. E. Feliciana Parish Police Jury v. Guidry 2004-1197 (La. App. 1 Cir. 8/10/05), 923 So. 2d 45, writ denied, 05-2288 (La. 3/10/06), 925 So. 2d 515, the court looked not only at the level of the noise, but also at the “nature” of the noise. The court held that noise from a motor cross track was a nuisance, likening the noise to a chainsaw, a buzzing bee, or a dentist drill.
Even when a landowner has a right to conduct a business on his property, he cannot create a nuisance in running the business. Louisiana courts have held that noxious smells, dust, debris, rats, flies, and noise may all constitute a nuisance, even if the business was otherwise lawful.
The duty owed to neighbors applies not only to the landowner, but may also apply to tenants or contractors performing “work” on the property. To prove a nuisance, the offended neighbor must show that the landowner/tenant/contractor either “knew or should have known” that the activity was a nuisance.
When mending fences is not possible, you may have other options.
Chelsea Payne is an associate at Keogh Cox and has been practicing for three years. Her practice mainly relates to construction law and complex litigation. Chelsea enjoys playing tennis and spending time with her family.
Louisiana
Insight
Privacy (Or Lack Thereof) in an Increasingly Digital Age
“Historically, privacy was almost implicit, because it was hard to find and gather information. But in the digital world, whether it's digital cameras or satellites or just what you click on, we need to have more explicit rules - not just for governments but for private companies.” -Bill Gates
Supreme Court oral arguments were heard earlier this week in Carpenter v. United States, a closely watched case which stands to impact what privacy means in our digital age. The case will decide whether law enforcement is permitted to gather cellphone data from third-party service providers like Verizon and AT&T without a warrant. Carpenter presents the latest installment in the eternal struggle between the need for safety and the desire to prevent a surveillance state.
In Carpenter, the FBI investigated a series of robberies at Radio Shack and T-Mobile stores in Detroit. Suspecting that Carpenter was operating as a “getaway driver,” the FBI sought and obtained without a warrant the location data for his cell phone. This data revealed that Carpenter (or at least his cell phone) was near the stores at the times of the robberies––damning evidence.
Carpenter argued that the government’s collection of his cell photo data was a “search” under the 4th Amendment, a "search" which would require a warrant supported by “probable cause.” The government maintained that privacy concerns were addressed when law enforcement complied with the Stored Communications Act which allows law enforcement access upon a showing that the information sought is "relevant and material" to an ongoing investigation. The government further argued that there is no reason to afford greater protection to cell phone data than given to other data such as bank records and dialed telephone numbers which can be obtained without a warrant.
The issues presented in Carpenter are not new, but are magnified by the awesome power of advancing technology to track our movement and assembly with others. The Louisiana court in State v. Bone, 12-34 (La. App. 5 Cir. 9/11/12), 107 So. 3d 49, held that an exclusive user of a cell phone did not have a reasonable expectation of privacy to the call detail record log associated with the phone. The court reasoned that access to the information in the detail record log was voluntarily surrendered by the defendant to the phone’s providers. However, in United States v. Jones, 132 S. Ct. 945 (2012), the United States Supreme Court found that the installation of a GPS device on a vehicle to monitor the vehicle’s movement was a “search” under the 4th Amendment. Carpenter addresses the intersection of these two cases.
By carrying a cell phone you know can track your movements, do you lose any reasonable expectation of privacy? Or, would allowing warrantless access to this information be akin to the prohibited GPS search in United States v. Jones? The Supreme Court will soon decide. How it chooses will impact criminal litigation and by extension how cell phone data is regarded in civil suits. More importantly, it may also impact the relationship between citizens and their government.
Collin LeBlanc is a Keogh Cox partner and experienced litigator who concentrates in injury, commercial, and legal malpractice disputes. He lives in nearby Zachary, Louisiana with his wife Melissa and three all-too-active children. He is an outdoorsman, a tennis player, a cook, and a hobbyist writer.
Supreme Court
Insight
Keogh Cox Partner Secures Defense Verdict in Fatal Shooting Case
Andrew Blanchfield, Managing Partner at Keogh Cox, represented the Louisiana Office of State Police and a State Trooper in a recent wrongful death jury trial in the 19th Judicial District Court in Baton Rouge. In the case, Andrew Arway was fatally shot during a traffic stop in Avoyelles Parish on May 24, 2004 by a Louisiana State Trooper.
The Trooper's dash cam video established that the traffic stop was initiated at 4:30 a.m. However, Arway did not initially stop his vehicle and instead drove forward slowly for several hundred feet. Once Arway's vehicle came to a stop, he exited, placed his hands in his pockets, and began to move to the front of his truck, ignoring the Trooper’s commands. Arway then made the motion of searching for a weapon. At one point, he formed his hands as if he held a gun and yelled “freeze.” In response, the Trooper loudly commanded Arway to place his hands where they could be seen. Arway again ignored the Trooper's commands and moved towards a ditch, outside of camera view.
The Trooper testified that Arway continued to make gestures as if he was looking for a weapon around his ankle. According to the Trooper, he fired two shots when he lost sight of Arway’s hands. No weapon was found on Arway and his blood alcohol level was twice the legal limit.
Arway’s wife and children brought a wrongful death action alleging excessive force. At trial, Blanchfield argued that the Trooper’s force was reasonable and that the Trooper justifiably feared for his life in view of Arway’s bizarre and threatening behavior. Evidence was also presented that Arway’s behavior was consistent with a “suicide by cop” theory.
The Baton Rouge jury deliberated for 90 minutes and concluded that the Trooper’s use of force was reasonable under the circumstances.
Andrew "Drew" Blanchfield is a litigator with over 30 years of courtroom experience. Litigating dozens of complex jury trials in state and federal courts, Drew has offered representation to various sectors to include industrial accidents, business litigation, oil and gas, healthcare, and professional liability defense. When he is not advising his corporate clients or in a court room (or on the tennis court), Drew spends time with his wife and four children.
State Courts
Insight
Jury Duty Part 2: Am I exempt from being a juror?
“There were eleven votes for 'guilty.' It's not easy for me to raise my hand and send a boy off to die without talking about it first.” - Reginald Rose, Twelve Angry MenJury service is a civil duty. Our system would collapse without the diligent individuals who respond and serve, but the law does provide exemptions and exceptions which may be utilized to be excused. Part 2 of this blog will explore those circumstances.General Exemptions
Louisiana provides two general exemptions from jury service.
1 - Age. Persons seventy years of age or older shall be exempt from jury service and may decline to serve as jurors. La. Const. Ann. art. V, § 33. However, they are free to serve if otherwise qualified.
2 - Prior Service. The second, all “persons who have served as grand or petit jurors in criminal cases or as trial jurors in civil cases or in a central jury pool during a period of two years immediately preceding their selection for jury service.” La. Sup. Ct. R. 25.
No exemption is automatic. A prospective juror qualifying for one of the above exemptions must assert the exemption by contacting the appropriate jury commission.
Recognized Excuses
In criminal cases, a juror may be excused when such service “would result in undue hardship or extreme inconvenience.” C.Cr.P. art. 783
In civil cases, a juror may be excused when service would result in “undue or extreme physical or financial hardship.” However, these circumstances are limited to circumstances in which an individual would:
1. Be required to abandon a person under his or her personal care or supervision due to the impossibility of obtaining an appropriate substitute care giver during the period of participation in the jury pool or on the jury; or
2. Incur costs that would have a substantial adverse impact on the payment of the individual's necessary daily living expenses or on those for whom he or she provides the principal means of support; or
3. Suffer physical hardship due to an existing illness or disease. La. Rev. Stat. Ann. § 13:3042
With respect to both criminal and civil service, a request for excusal can be mailed to the issuing court and should include an explanation of circumstances. In most cases, the letter must also include supporting documentation, such as, “state income tax returns, medical statements from licensed physicians, proof of dependency or guardianship, and similar documents, which the judge finds to clearly support the request to be excused.” “Failure to provide documentation shall result in a denial of the request for a waiver.” La. Rev. Stat. Ann. § 13:3042You should serve if you can but, if you need to be excused, questions regarding exemptions, excusals, and/or qualifications should be directed to the appropriate jury commissioner’s office.
Louisiana
State Courts
Jury
Insight
Jury Duty Part 1: Am I qualified to be a juror?
“Jury: A group of 12 people, who, having lied to the judge about their health, hearing, and business engagements, have failed to fool him.” - Henry Louis MenckenCongratulations, you have been selected for jury duty. As American as baseball, jury duty is a pillar of the American system of justice, and you can step right up and participate-if you are qualified. In this two-part series, we outline the qualifications and exemptions for potential jurors in Louisiana.In Louisiana, “all qualified citizens shall have the opportunity to be considered for jury service in the district courts of Louisiana and shall have an obligation to serve as jurors when summoned for that purpose, and that no citizen shall be excluded from jury service in the district courts of Louisiana on account of race, color, religion, sex, national origin or economic status.” La. Sup. Ct. R. 25To serve as a juror for a civil or criminal case, you must meet the following criteria:
- Be both a citizen of the United States and Louisiana who has resided within the parish in which he or she is to serve for at least one year immediately preceding his jury service.
- Be at least eighteen years of age.
- Be able to read, write, and speak the English language and be possessed of sufficient knowledge of the English language.
- Not be under interdiction or incapable of serving as a juror because of a mental or physical infirmity, provided that no person shall be deemed incompetent solely because of the loss of hearing in any degree.
- Not be under indictment for a felony nor have been convicted of a felony for which he has not been pardoned by the governor. C.Cr.P. art. 401, La. Rev. Stat. Ann. § 13:3041.
If you receive a jury duty notice and do not meet one of the above requirements, you are encouraged to contact the jury commissioner’s office. Who knows, you may be free in time for the first pitch.
Louisiana
State Courts
Jury
Insight
THE “ATTORNEY CLIENT” PRIVILEGE”: How, When (and Why) Communications between You and Your Attorney are Protected - Part 2
Part 1 of this two-part series explored the basic elements of the attorney-client privilege. Part 2 will discuss some of the restrictions to the privilege.
The privilege applies only to legal matters.
While legal advice is protected, advice that is considered “business advice” may not. Unfortunately, the line between legal and business advice is not always clear. Legal advice requires that the attorney interpret law and apply it to specific facts to do one (or both) of two things: tell the client what to do in the future or tell the client what was done right (or wrong) in the past. Business advice involves discussions about the operations of a client which are independent from legal considerations.
If the communication involves both legal advice and business advice, the general rule is that the legal advice must predominate over the business advice. See, Exxon Mobil Corp. v. Hill, 2013 WL 3293496 (E.D. La. June 28, 2013), vacated and remanded on other grounds by Exxon Mobil Corp. v. Hill (5th Cir. May 6, 2014).
The crime-fraud exception.
The privilege is also subject to the “crime fraud” exception. Communications between an attorney and client regarding either: 1) a plan or intent to commit a crime or fraud; or 2) while the crime or fraud is being committed, are not protected by the attorney-client privilege. Remember, you obtain the services of an attorney to obtain legal advice, not illegal advice. As explained by the court in State v. Menard, 02-1182 (La. App. 3 Cir. 5/7/03), 844 So. 2d 1117, the reasons for the privilege cease to operate when the legal advice refers to future wrongdoing.
Other exceptions.
The privilege also has other limitations, including the fact that it may be waived, intentionally or unintentionally, by the client. As discussed in Part 1 of this blog, the decision to include third-parties in conversations and communications (including emails) between the client and the attorney may waive the privilege. If a client sues an attorney after the relationship has terminated, the privilege is likewise waived, and the attorney can discuss privileged communications to defend himself against that suit. Similarly, if an attorney acted as a notary or witness to a document, the attorney may discuss whether a document is authentic or whether the signors were legally competent to sign. Interestingly, the privilege also does not apply to communications with a deceased client if the communications are relevant to an inheritance dispute.
The attorney client privilege offers broad protection; however, it is important to remember that this protection is not without its limits.
Attorney
Insight
THE “ATTORNEY-CLIENT” PRIVILEGE: How, When (and Why) the Communications between You and Your Attorney are Protected - Part 1
This blog is one of a two-part series regarding perhaps the most important aspect of the attorney-client relationship -- the attorney-client privilege. So, what is it and why is the privilege so important? In short, the attorney-client privilege is a legal doctrine that protects communications between a client and his or her attorney. Unlike most other relationships, the privilege stays in place even after the relationship is terminated. The purpose of the privilege is to allow clients to have open and honest communications with their attorney. LSA-L.C.E. art. 506. However, not all communications between a client and attorney are privileged and certain requirements must be met for the privilege to attach.
-Existence of Attorney-Client Relationship. An attorney-client relationship must be in place. Louisiana law does not require that the attorney be formally retained or payment made for the privilege to attach. The privilege may apply even when the client merely discusses a legal matter with an attorney when the client reasonably believes the attorney is acting as his or her attorney.
-Confidential Communications. While the communication can take many forms (oral, written, digital, etc.) it is protected only if it was intended to be confidential, which generally means that the communication was not intended to be disclosed to others not involved in the attorney-client relationship or the legal representation. For example, if a client meets with his attorney and brings a friend along, then the meeting may not be protected by the privilege. Because the privilege is for the protection of the client, the client may choose to intentionally waive the privilege, or may do so inadvertently through their actions.
-Legal Services. The communication must be related to obtaining or facilitating the legal services offered by the attorney. The privilege has been held to apply to the employees of the attorney and sometimes experts retained to assist in the case.
When applicable, the attorney-client privilege applies not only to what was said, but also to your attorney’s observations of your mental, emotional, and physical state at the time you communicate. The privilege does not generally apply to information gathered by the attorney from other sources; however, another doctrine, the “work product” doctrine, may nevertheless protect such information.It is important that clients understand that the privilege does not apply merely because the client chooses to involve the attorney in the communication. Generally, the privilege only applies when the communication was intended as confidential and to further the legal services offered by the attorney. In this way, the client may not be allowed to utilize the privilege where they include the attorney in a communication with a third-party that is not otherwise protected.While the attorney-client privilege safeguards the attorney-client relationship, ensures that clients can tell their attorney the things they need to know about a case, and assists the attorney to provide the best legal help possible, it is also subject to restrictions. These restrictions are explored in Part 2 of this series.
Attorney
Insight
SHOW ME YOUR TAX RECORDS: Why You Should Preserve Business and Tax Records
A case successfully handled by Keogh Cox on behalf of the Louisiana Department of Revenue serves a strong reminder of the importance of maintaining business tax records, and of the significant burden imposed on Taxpayers who do not.
In Barfield v. Diamond Construction, Inc., 51,291 (La. App. 2 Cir. 4/5/17), 217 So.3d 1211, writ denied, 2017-0751 (La. 9/15/17), 2017 WL 4105839, the Louisiana Second Circuit affirmed the Trial Court who granted summary judgment in favor of the Louisiana Department of Revenue in response to a Taxpayer’s failure to pay sales and use taxes over the span of several years.
Although the burden of proof on a motion for summary judgment is usually imposed on the party who filed the motion, a Louisiana statute (La. R.S. 13:5034) shifts the burden in suits filed by the Department of Revenue to collect unpaid taxes. Therefore, to defeat the Department’s motion in Barfield, the Taxpayer possessed the burden to demonstrate that taxes were not owed on the various transactions at issue. Because the law presumes that sales and rentals of tangible personal property are fully taxable, the Taxpayer possessed the additional burden to show that the sales and rentals involved exempted categories. In the face of this “double burden,” the Taxpayer was unable to provide business records to demonstrate the nature of each transaction as these records were not preserved by the Taxpayer.
During the Department’s audit, the Taxpayer was unable to present the necessary records to prove it did not owe taxes on certain transactions. As a result, the Department was allowed to complete the audit by making an estimate of the amount of taxes owed for the subject transactions. The resulting audit findings were then treated as prima facie correct and were ultimately accepted because the Taxpayer offered no contrary evidence.
Noting the Taxpayer’s poor record-keeping, the Court cited the failure to produce the necessary records in support of its conclusion that the Taxpayer did not create a “material issue of fact” in opposition to the Department’s motion. This warranted the entry of judgment in favor of the Department and should remind every business of the real-world need to keep your tax records.
Written by: Chris Jones
Louisiana