Jouve v. State Farm Fire & Cas. Co.

• Court: Court of Appeal of Louisiana (US)
• Citation: 74 So.3d 220
• Docket Number: No. 2010–CA–1522.,2010–CA–1522.
• Parties: Patrick JOUVE and Elizabeth Jouve v. STATE FARM FIRE AND CASUALTY COMPANY, Carl W. Mixon and Michail Whittle.
• Decision Date: 13 September 2011

74 So.3d 220

Patrick JOUVE and Elizabeth Jouve
v.
STATE FARM FIRE AND CASUALTY COMPANY, Carl W. Mixon and Michail Whittle.

No. 2010–CA–1522.

Court of Appeal of Louisiana, Fourth Circuit.

Aug. 17, 2011.Rehearing Denied Sept. 13, 2011.

[74 So.3d 222]

Joseph S. Piacun, Reid S. Uzee, Gennusa Piacun & Ruli, Metairie, LA, for Plaintiffs/Appellants.

Wm. Ryan Acomb, Michele L. Trowbridge, Porteous Hainkel & Johnson, LLP, New Orleans, LA, for Defendant/Appellee, State Farm Fire and Casualty Company.

(Court composed of Judge MICHAEL E. KIRBY, Judge EDWIN A. LOMBARD, Judge DANIEL L. DYSART).

MICHAEL E. KIRBY, Judge.

[4 Cir. 1] This matter involves a disputed claim under a homeowners insurance policy for property damage that occurred during Hurricane Katrina. Plaintiffs, Patrick and Elizabeth Jouve (“plaintiffs”), appeal the parts of the April 7, 2010 trial court judgment in favor of defendant, State Farm Fire and Casualty Company (“State Farm”), which granted a motion in limine to exclude the testimony and report of plaintiffs' expert, A. Vincent Caracci; summarily dismissed plaintiffs' bad faith claims against State Farm; and limited plaintiffs' recovery to the actual cash value at the time of the loss of the wind damaged part of their property. Plaintiffs also appeal from the June 30, 2010 trial court judgment that denied their motion for new trial. For the reasons that follow, we affirm.

In August 2005, plaintiffs owned a house located at 3822 Octavia Street in New Orleans, which was insured under two separate insurance policies: (1) a flood insurance policy issued under the National Flood Insurance Program (“NFIP”); and, (2) a homeowners policy issued by State Farm, which provided coverage in the amount of $151,400.00 for dwelling; $15,140.00 for dwelling [4 Cir. 2] extension; $113,550.00 for contents; and actual loss sustained for loss of use. On August 29, 2005, Hurricane Katrina hit Louisiana, causing levee breaches that resulted in flooding throughout the New Orleans area. As a result, plaintiffs' Octavia Street home sustained catastrophic damages.

Plaintiffs filed a flood claim with the NFIP, and were paid $145,000.00 for building loss under the flood policy.¹ They also filed a property damage claim with State Farm under their homeowners policy. After adjusting the claim, State Farm paid plaintiffs $41,346.89 for windrelated damages under the homeowners policy.

On August 26, 2006, plaintiffs filed a petition in the district court alleging that State Farm arbitrarily and capriciously failed to properly adjust their claim and pay the full amount due under their homeowners policy.² They allege that State

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Farm acted in bad faith and failed to timely satisfy the claim after receiving satisfactory proof of loss, entitling them to statutory penalties and attorney fees and costs pursuant to La. R.S. 22:658 ³ and La. R.S. 22:1220 ⁴. State Farm answered the petition, and discovery commenced.

[4 Cir. 3] On December 7, 2009, State Farm filed several pre-trial motions, including the three at issue in this appeal: (i) Motion in Limine to Exclude Plaintiffs' Expert Witness A. Vincent Caracci; (ii) Motion for Partial Summary Judgment as to Plaintiffs' Bad Faith Claims; and, (iii) Motion for Partial Summary Judgment as to Plaintiffs' Dwelling Claims.

Following a hearing, the trial court rendered a judgment on April 7, 2010, on the motions at issue as follows: (i) granted Stated Farm's Motion in Limine to Exclude the testimony and estimate of A. Vincent Caracci; (ii) granted State Farm's Motion for Partial Summary Judgment dismissing with prejudice plaintiffs' bad faith claims; and, (iii) granted, in part, State Farm's Motion for Partial Summary Judgment as to Plaintiffs' Dwelling Claims, limiting plaintiffs' claim to actual cash value minus depreciation ⁵, and dismissing with prejudice the dwelling claim for replacement cost with full value. The April 7, 2010 judgment specifically designated the partial summary judgments as final judgments and expressly determined there was no just reason for delay pursuant to La. C.C.P. art. 1915(B)(1).

On April 16, 2010, plaintiffs filed motion for new trial based on newly discovered evidence, citing La. C.C.P. art. 1972(2). Following a hearing, the trial court rendered a judgment on June 30, 2010, denying the motion. Plaintiffs timely appealed.⁶

[4 Cir. 4] Plaintiffs raised five assignments of error in this appeal.

1. The trial court erred in considering the availability of a legal malpractice remedy as an alternative to a new trial, necessitating a de novo review of the trial court's decision.

2. The trial court abused its discretion by not granting plaintiffs a new trial and allowing Mr. Caracci to testify as an expert witness at trial.

3. The trial court abused its discretion by not granting plaintiffs a new trial and allowing the introduction of the expert report (estimate) prepared by Mr. Caracci.

4. The trial court erred in granting partial summary judgment on the

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issue of penalties and attorney fees and denying the motion for new trial on this issue.

5. The trial court erred in granting partial summary judgment limiting the plaintiffs' property damage recovery to actual cash value rather than replacement cost and denying the motion for new trial on this issue.

We will consider the assignments of error by addressing the trial court's rulings on the underlying motions and then its judgment denying the plaintiffs' motion for new trial.

Motion in Limine to Exclude Plaintiffs' Expert Witness A. Vincent Caracci

Following the Hurricane, the plaintiffs hired Mr. Caracci, owner of Gulf Coast Construction, to inspect their home for both wind and flood damage and to give them an estimate to repair the damages. Based on Mr. Caracci's estimate, the plaintiffs claimed State Farm underpaid their wind damages by $70,000.00. The plaintiffs listed Mr. Caracci as a witness on their pre-trial witness list. After deposing Mr. Caracci, State Farm sought to exclude him from testifying as an expert, arguing that his opinion failed to meet the standards set forth in [4 Cir. 5] Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579, 113 S.Ct. 2786, 125 L.Ed.2d 469 (1993).⁷ Specifically, State Farm argued that Mr. Caracci was not qualified to testify as an expert because he was not a licensed engineer, contractor or insurance adjuster. State Farm also emphasized that Mr. Caracci never prepared the actual wind and flood damage estimates on the Jouve property, but rather A. Vincent Caracci, IV ⁸, Mr. Caracci's grandson, prepared the estimates using “Xactimate,” a computer program, while assisting his grandfather at the inspection.

The Louisiana Code of Evidence allows a witness to qualify as an expert witness by knowledge, skill, experience, training or education. La. C.E. art. 702. The admissibility of expert testimony turns upon whether the trier of fact will be assisted in understanding the evidence or determining a fact in issue. Comment (a) to La. C.E. art. 702.

In Cheairs v. State ex rel. Dept. of Transp. And Dev., 2003–0680, pp. 1–2 (La.12/3/03), 861 So.2d 536, 538, the Louisiana Supreme Court recognized that Daubert addressed only the issue of the reliability of an expert's methodology and not whether an expert possessed the proper qualifications to testify. The Court, therefore, adopted three-part inquiry set forth in City of Tuscaloosa v. Harcros Chemicals, Inc., 158 F.3d 548 (11th Cir.1998), concluding it “provides more comprehensive guidance to district courts determining the admissibility of expert [4 Cir. 6] testimony.” Id., 2003–0680 at 10, 861 So.2d at 543. Thus, the admission of expert testimony is proper only if all three of the following

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guidelines are met: (1) the expert is qualified to testify competently regarding the matters he intends to address, (2) the methodology by which the expert reaches his conclusions is sufficiently reliable as determined by the sort of inquiry mandated in Daubert, and (3) the testimony assists the trier of fact through the application of scientific, technical or specialized expertise, to understand the evidence or to determine a fact in issue. Id., 2003–0680 at 9, 861 So.2d at 542, citing Harcros Chemicals, 158 F.3d at 562.

“A trial court is accorded broad discretion in determining whether expert testimony should be admissible and who should or should not be permitted to testify as an expert.” Everhardt v. Louisiana Department of Transportation and Development, 2007–0981, p. 15 (La.App. 4 Cir. 2/20/08), 978 So.2d 1036, 1048 (citations omitted). Whether an expert meets the qualifications of an expert witness and the competency of the expert witness to testify in a specialized area is within the sound discretion of the trial court. Id. A trial court's decision to qualify an expert will not be overturned absent an abuse of discretion. Id.

In support of its motion in limine, State Farm submitted the deposition testimony of Mr. Caracci, who testified that he was neither a licensed engineer nor licensed insurance adjuster. Although he referred to himself as a contractor, Mr. Caracci acknowledged that he had not held a valid contractor's license in fifteen years. Mr. Caracci testified that he had never taken any insurance adjusting classes [4 Cir. 7] to determine wind versus flood damage, but rather relied on his past experience evaluating property damage following Hurricane Betsy in 1965 to prepare his Hurricane Katrina related estimates.

Regarding the inspection of the Jouve property, Mr. Caracci recalled that his son (grandson) and Jose Terwought, a roofer, accompanied him on the inspection. According to Mr. Caracci, they walked throughout the house and his son (grandson) prepared the actual damage estimates using the Xactimate computer program. Mr. Caracci admitted that due to his poor health he was unable to complete the inspection. He acknowledged that he never inspected the attic or the roof. Mr. Caracci...