Odessa House v. Goss

• Decision Date: 14 June 1984
• Docket Number: No. 83-548,83-548
• Citation: 453 So.2d 299
• Parties: ODESSA HOUSE, Plaintiff-Appellee, v. Kenya Sue GOSS, and State Farm Mutual Automobile Insurance Company, Defendants-Appellants.
• Court: Court of Appeal of Louisiana — District of US

Page 299

453 So.2d 299

ODESSA HOUSE, Plaintiff-Appellee, v. Kenya Sue GOSS, and State Farm Mutual Automobile Insurance Company, Defendants-Appellants.

No. 83-548.

Court of Appeal of Louisiana, Third Circuit.

June 14, 1984.

Gist, Methvin, Hughes & Munsterman, DeWitt T. Methvin, Jr., for defendants-appellants.

Chris J. Roy, Alexandria, for plaintiff-appellee.

Before DOMENGEAUX, GUIDRY and DOUCET, JJ.

DOUCET, Judge.

Plaintiff, Odessa House, instituted the present suit on September 23, 1980, claiming personal injuries and medical expenses as a result of an automobile accident which occurred in Oakdale, Louisiana, on September 22, 1979. Defendants, Kenya Sue Goss and her liability insurer, State Farm Mutual Insurance Co., responded by filing a peremptory exception of prescription of one year. The trial judge subsequently overruled the exception and thereafter rendered judgment in favor of plaintiff in the sum of $15,000.00. Defendant State Farm Mutual Insurance Company appeals the overruling of its exception of prescription. We affirm.

Plaintiff was a passenger in an automobile owned and operated by her husband, Billy House, when it collided on September 22, 1979, at an intersection with an automobile driven by Kenya Sue Goss who failed to stop at a stop sign. Both automobiles were insured for liability and medical coverage by State Farm Mutual Automobile Insurance Company. Negotiations between plaintiff and the insurer ensued and it is on this basis that appellee contends prescription was interrupted by acknowledgement.

Plaintiff introduced into evidence a letter from plaintiff's attorney to defendant's adjuster dated June 6, 1980 advising of representation by him, that State Farm insured the House automobile and inquiring which policy would take care of the House medical bills. Introduced as Exhibit "House-2" was a letter dated June 9, 1980 from defendant's adjuster to plaintiff's attorney which stated in pertinent part:

"Under Mrs. House's personal insurance policy with State Farm there is a medical pay coverage of $2,000.00 on which we do have subrogation rights. Therefore, her medical bills have not been paid under the medical portion of her policy, but rather under the liability portion of the Kenya Sue Goss policy who is evidently at fault in this accident.

"If you have any medical specials which I have not paid to date, please forward them directly to my attention and they will be promptly paid as a liability advance payment under the Goss policy.

"To date, on behalf of Odessa House, I have paid the following medical bills:

* * *

* * *

Total paid to date $524.39

"Please review this claim at your very earliest convenience and provide me with your evaluation of it and settlement demand."

Subsequently, the adjuster tendered an offer of $5,000.00 plus medicals in an attempt to settle the claim. The offer was never revoked.

On June 30, 1980, defendant's adjuster again wrote to plaintiff's attorney requesting a settlement demand.

Mrs. House never personally dealt with the defendant's insurer or any of the insurer's agents. Mr. House testified that after the accident, he initially contacted his agent, Wade Green, for State Farm in Oakdale. Nolan Craven, a claims adjuster for the insurance company, later got in touch with Mr. House and from then on handled the House case. Thereafter, Mr. Craven arranged the payment of $5,600.00 for the House's totaled automobile and arranged the payment of all medical bills arising from the accident. Subsequently, Mr. Craven and Mr. House had a series of conversations with respect to the plaintiff's claim for personal injuries. The adjuster admitted the defendant was "evidently at fault" and three to four weeks after the accident made an offer of $5,000.00 plus medicals in an attempt to settle the claim. Mr. House felt that his acceptance of the offer on behalf of his wife would be premature, in light of her continuing medical problems. At no time was the settlement offer subsequently withdrawn. Mr. Craven then told Mr. House to continue taking the plaintiff to doctors and to send him all medical bills. He told Mr. House to come back once his wife's medical condition was ascertainable and they would settle on an acceptable sum for her personal injuries. Thus the adjuster paid all of plaintiff's medical expenses under the Goss policy, paid for the loss of the House' vehicle, and sought to pay appellee's personal injury claim.

In the trial court, plaintiff contended that the parties' communication constituted sufficient acknowledgement of plaintiff's "right" to interrupt the running of the one year prescription against plaintiff's claim. The trial court agreed and overruled defendant's exception of prescription without assigning reasons.

At the time of this accident Civil Code Article 3520 provided:

"Prescription ceases likewise to run whenever the debtor or possessor, makes acknowledgement of the right of the person whose title they prescribed."

The article was changed effective January 1, 1983, and now bears Civil Code Article 3464 and states:

"Prescription is interrupted when one acknowledges the right of the person against whom he had commenced to prescribe."

An acknowledgement interrupting liberative prescription may be oral or written, formal or informal, express or tacit. Lake Providence Equipment Co. v. Tallulah Production Credit Assoc., 257 La. 104, 241 So.2d 506 (1970). However, the interruption of prescription has no effect beyond the specific right of the person of which the debtor makes acknowledgement. Flowers v. United States Fidelity & Guaranty Co., on rehearing, 381 So.2d 378 (La.1980).

Appellant contends that as there was medical expense coverage under the House policy which applied to Mrs. House's injuries, the payment of medical expenses, even under the Goss policy, did not constitute an acknowledgement of Mrs. House's personal injury claim. Appellant also contends that the requests for a settlement demand in an attempt to negotiate a settlement did not constitute an acknowledgement of plaintiff's bodily injury claim sufficient to interrupt prescription citing Emery v. Cabral, 400 So.2d 340 (La.App. 4th Cir.1981) writ denied, 405 So.2d 533 (La.1981), wherein the court stated:

"The general rule regarding the burden of proof is that when the plaintiff's petition shows on its face that the prescriptive period has run, and the plaintiff is contending there was a suspension or interruption of prescription, the burden is on the plaintiff to prove the suspension or interruption. Cordova v. Hartford Accident and Indemnity Company, 378 So.2d 1088 (La.App. 3rd Cir.1979) ^*; Yarbrough v. Louisiana Cement Company, Inc., 370 So.2d 602 (La.App. 4th Cir.1970) writ denied, 373 So.2d 531 (La.1979).

Furthermore, the recognition of the mere existence of a disputed claim is not such an acknowledgement within the contemplation of Article 3520 as will effect an interruption of the running of prescription. The acknowledgement must be accompanied by or coupled with a clear declaration of intent to interrupt the prescription then running. Marathon Insurance Company v. Warner, 244 So.2d 353 (La.App. 2nd Cir.1971)."

Prescription statutes are strictly construed against prescription and in favor of the obligation sought to be extinguished by it. State ex rel. Guste v. Simoni, Heck and Associates, 331 So.2d 478 (La.1976); Gulf Oil Corp. v. State Mineral Board, on rehearing, 317 So.2d 576 (La.1975); Foster v. Breaux, 263 La. 1112, 270 So.2d 526 (1972). Prescription statutes find their justification in the desire to avoid unfair prejudice to the defendant by requiring him to defend a stale claim and to be put to a defense after memories have faded, witnesses are gone, and evidence has been lost; and to avoid prejudice to a defendant who was in ignorance of the asserted obligation. Here, the defendant was fully aware of the asserted obligation as evidenced by representations to plaintiff and suit was filed only one day after the prescriptive period.

As the Supreme Court stated in Flowers v. U.S. Fidelity & Guaranty Company, supra:

"... acknowledgement sufficient to interrupt prescription may be made verbally, in writing, by partial payment, by payment of interest or by pledge or in other ways; ... it may be implicit or it may be inferred from the facts and circumstances."

The policy considerations regarding the weight of evidence to support a plea of interruption of prescription were set forth in Trainer v. Aycock Welding Co., 421 So.2d 416 (La.App. 1st Cir.1982) as follows:

"It has long been the public policy of this state that the compromise of disputes are highly favored and...