David v. La. Citizens Prop. Ins. Corp.

• Decision Date: 25 January 2013
• Docket Number: No. 2012–CC–0152.,2012–CC–0152.
• Citation: 118 So.3d 1011
• Parties: David and Demetria QUINN v. LOUISIANA CITIZENS PROPERTY INSURANCE CORPORATION.
• Court: Louisiana Supreme Court

118 So.3d 1011

David and Demetria QUINN

v.LOUISIANA CITIZENS PROPERTY INSURANCE CORPORATION.

No. 2012–CC–0152.

Supreme Court of Louisiana.

Nov. 2, 2012.

Rehearing Denied Jan. 25, 2013.

Christovich & Kearney, Oscar McDuffie Gwin, IV, Hailey, McNamara, Hall, Larmann & Papale, LLP, Darren Albert Patin, Christopher Marx G'sell, for applicant.

Harry Cantrell Law Firm, Harry E. Cantrell, Jr., Thomas Keasler Foutz, Bruno & Bruno, LLP, Joseph Michael Bruno, Melissa A. DeBarbieris, for respondent.

WEIMER, Justice.

[2012-0152 (La. 1]We granted certiorari in this case to consider two separate, but related issues: (1) whether the suspension of prescription provided for in La. C.C.P. art. 596 extends to a putative class member who files an individual claim after a ruling on the class certification issue and, if so, (2) whether La. C.C.P. art. 596 suspends prescription when the putative class action is filed in another jurisdiction. After reviewing the relevant statutory provisions, we find that the filing of an individual lawsuit after a ruling on class certification does not operate as an “opt out” of a class action proceeding and a forfeiture of the benefits of suspension provided in La. C.C.P. art. 596, but that the provisions of La. C.C.P. art. 596 do not extend to suspend prescription on claims asserted in a putative class action filed in a federal court. As a result, we reverse the district court's judgment denying the defendant's exception of prescription,sustain the exception, and remand this matter to the district court to allow plaintiffs the opportunity to amend the petition, if they can, to allege facts to show their claims are not prescribed.

[2012-0152 (La. 2]FACTS AND PROCEDURAL HISTORY

On October 28, 2009, plaintiffs David and Demetria Quinn (“the Quinns”) filed suit against Louisiana Citizens Property Insurance Corporation (“Citizens”) in the Twenty-fourth Judicial District Court for the Parish of Jefferson. ¹ In its preamble, the Quinns' petition asserts that Citizens was a defendant in a “Class Action Claim” in the United States District Court for the Eastern District of Louisiana that was “recently dismissed” and, as a result, the Quinns seek to assert “their individual claims.”

According to the petition, the Quinns' claims arise out of property they owned in Harvey, Louisiana. The petition alleges that on August 29, 2005, the property was insured under a homeowner's policy issued by Citizens. During Hurricanes Katrina and Rita, the property sustained wind and rain damage (prior to any flooding) which rendered it uninhabitable. More than thirty days elapsed after satisfactory proof of loss was submitted to Citizens, but compensation for the loss, according to the terms of the policy, was not received. Damages were requested for the underpayment of amounts due under the terms and conditions of the Citizens policy and for all other general and equitable relief as may be appropriate.

Citizens responded to the petition by filing a peremptory exception of prescription. In that exception, Citizens argued the Quinns were putative members of two class actions filed on behalf of similarly-situated Citizens insureds, Buxton v. Louisiana Citizens Property Ins. Corp., No. 2006–8341 on the docket of the Civil District Court for the Parish of Orleans, and Chalona v. Louisiana Citizens Property Ins. Corp., 08–0257 (La.App. 4 Cir. 6/11/08), 3 So.3d 494, but their claims [2012-0152 (La. 3]were no longer represented in those proceedings. Citing Taranto v. Louisiana Citizens Property Ins. Corp., 10–0105 (La.3/15/11), 62 So.3d 721, Citizens argued that based on the April 24, 2008 notice of class restriction issued in Chalona, the latest date on which the Quinns could timely assert their claims was May 31, 2009, and the petition filed on October 28, 2009, was, therefore, prescribed. Alternatively, citing Lester v. Exxon Mobil Corp., 09–1105 (La.App. 5 Cir. 6/29/10), 42 So.3d 1071,writ denied,10–2244 (La.12/17/10), 51 So.3d 14, Citizens argued that by filing an individual lawsuit, the Quinns “opted out” of all class actions and, in doing so, forfeited the benefit of the suspension of prescription afforded under La. C.C.P. art. 596, rendering their lawsuit untimely because it was filed long after the legislatively imposed deadline for filing claims for damages caused by Hurricanes Katrina and Rita.²

The Quinns opposed the exception of prescription, alleging they were putative class members in the following class action proceedings: Orrill v. AIG, Inc., 09–0888 (La.App. 4 Cir. 4/21/10), 38 So.3d 457,writ denied,10–0945 (La.9/17/10), 45 So.3d 1035;³Oubre v. Louisiana Citizens Fair Plan, 09–620 (La.App. 5 Cir. 11/9/10), 53 So.3d 492,writ granted,11–0097 (La.4/8/11), 61 So.3d 673;reversed,11–0097 (La.12/16/11), 79 So.3d 987;In Re: Katrina Canal Breaches Consolidated Litigation, No. 05–4182 on the docket of the United States District Court for the Eastern District of Louisiana; State v. AAA Ins. Co., No. 07–5524 on the docket of the United States District Court for the Eastern District of Louisiana (the “ Road Home” litigation); and Buxton. The Quinns argued that because Oubre, [2012-0152 (La. 4]Orrill, and the Road Home actions were then still pending, and because Buxton and In Re: Katrina Canal Breaches Consolidated Litigation were dismissed without notice to the Quinns, prescription on their individual claims remains suspended pursuant to La. C.C.P. art. 596. In addition, they argued that the filing of their individual claim was neither an “opt out” of any of the class actions, nor a forfeiture of the suspension of prescription provided under La. C.C.P. art. 596.

A hearing on the prescription exception was conducted on August 26, 2011. At that hearing, the district court entertained the arguments of counsel, but no evidence was offered or received. Instead, at the conclusion of argument, the district court ruled from the bench:

I'm going to deny the exception. The Taranto Court did not hold that all Plaintiffs who had claims against Citizen[s] had until May 31, 2009 to file. Whether a claim is prescribed for a putative member of a class depends on if the Plaintiff opts out of the class, and notice is given that the member has been excluded from the class or notice is given that the Court has denied certification of the class. In this case the Plaintiff has not received notice of any dismissals or restrictions on class action cases, which is a requirement to start the running of time of prescription. An[d] one or more of the cases is still pending, and so forth. This exception has to be denied.

Citizens applied for a supervisory writ from the adverse judgment. The Court of Appeal, Fifth Circuit, denied the writ. In written reasons accompanying the writ denial, the court of appeal reasoned:

In analyzing whether the plaintiffs in this case timely filed their claims, we must consider all class actions, which were timely filed, and whether the plaintiffs are putative members of any class. One class action, upon which the plaintiffs rely, Oubre v. Louisiana Citizens Fair Plan, 09–620, p. 28 (La.App. 5 Cir. 11/9/10), 53 So.3d 492, 508,writ granted,11–0097 (La.4/8/11), 61 So.3d 673,writ denied,11–0173 (La.4/8/11), 61 So.3d 687, defined the class as including insureds of Citizens who provided notification of loss but did not receive adjustment of the claims within 30 days, an allegation made here.

Oubre is pending on appeal. At this time, the current plaintiffs have received no notice that the Oubre court has denied certification of the [2012-0152 (La. 5]class or excluded any member from the class. Thus, prescription has not yet run. La. C.C.P. art. 596.

Quinn v. Louisiana Citizens Property Ins. Corp., 11–C–937, p. 2 (La.App. 5 Cir. 9/23/11) (unpublished).

The court of appeal made short shrift of Citizens' argument that the Quinns opted out of all respective classes by filing their individual lawsuits after the resolution of the class certification issue in each, distinguishing Lester on the grounds that “plaintiffs in this case, unlike the Lester case, filed suit after class certification,” as opposed to before. Id.

On Citizens' application, we granted certiorari to review the correctness of the lower courts' rulings. Quinn v. Louisiana Citizens Property Ins. Corp., 12–CC–0152 (La.3/30/12), 85 So.3d 100.

LAW AND ANALYSIS

Our grants of certiorari in this case and in the case of Duckworth v. Louisiana Farm Bureau Mutual Ins. Co., 11–2835 (La.3/30/12), 85 So.3d 99, were directed to addressing the issue of whether a plaintiff who is a putative class member, but who elects to file an individual suit, effectively opts out of the class and loses the benefit of any suspension of prescription resulting from the filing of the class action. In Duckworth, the plaintiffs filed an individual lawsuit prior to the resolution of the class certification issue in the class action in which they were putative members. In the instant case, the individual lawsuit was filed after a determination on class certification. In both cases, the defendants argue that the filing of an individual lawsuit operates as an “opt out” of any class action proceeding in which a plaintiff is a putative class member and a forfeiture of the benefits of the suspension of prescription afforded by La. C.C.P. art. 596.

[2012-0152 (La. 6]For the reasons assigned in the Duckworth opinion (released simultaneously with the opinion here), we hold that the filing of an individual lawsuit, regardless of its timing, is not an avenue for “opting out of” or requesting exclusion from a class and, thus, not a trigger for recommencing the running of liberative prescription under La. C.C.P. art. 596 or for forfeiting the benefits of suspension provided thereunder. Duckworth, 11–2835 at 14–20, 85 So.3d at 100. Our conclusion in this regard is both constrained and defined by the express words of La. C.C.P. art. 596, which extends the benefits of suspension to the claims of all...