Taylor v. Babin

• Decision Date: 08 May 2009
• Docket Number: No. 2008 CA 2063.,2008 CA 2063.
• Citation: 13 So.3d 633
• Parties: Eva TAYLOR and Kevin Ledet v. Camille E. Saltz BABIN, Camille E. Saltz, a Professional Law Corp., Joan Malbrough, Joan Malbrough & Associates, a Professional Law Corporation, Jerri G. Smitko, and The Law Office of Jerri G. Smitko, a Professional Law Corporation.
• Court: Court of Appeal of Louisiana — District of US

13 So.3d 633

Eva TAYLOR and Kevin Ledet v. Camille E. Saltz BABIN, Camille E. Saltz, a Professional Law Corp., Joan Malbrough, Joan Malbrough & Associates, a Professional Law Corporation, Jerri G. Smitko, and The Law Office of Jerri G. Smitko, a Professional Law Corporation.

No. 2008 CA 2063.

Court of Appeal of Louisiana, First Circuit.

May 8, 2009.

Stephen S. Stipelcovich, Michael J. Samanie, Houma, LA, for Plaintiffs-Appellants, Eva Taylor, Kevin Ledet, and Jesse Foret.

Jack E. Truitt, Nancy N. Butcher, Madisonville, LA, for Defendants-Appellees, Joan Malbrough and Joan Malbrough & Associates, APLC.

E. Phelps Gay, Kevin R. Tully, New Orleans, LA, for Defendants-Appellees, Jerri G. Smitko and Jerri G. Smitko, APLC.

Before PARRO, McCLENDON, and WELCH, JJ.

WELCH, J.

This is an appeal by the plaintiffs, Eva Taylor, Kevin Ledet, and Jesse Foret,¹ from a judgment granted in favor of defendants, Camille E. Saltz Babin; Camille E. Saltz, A Professional Law Corporation; Joan Malbrough; Joan Malbrough & Associates, A Professional Law Corporation; Jerri G. Smitko; and The Law Office of Jerri G. Smitko, A Professional Law Corporation. The judgment sustained the defendants' peremptory exceptions raising the objections of no right of action or interest to institute suit and/or no cause of action, and dismissed the plaintiffs' claims with prejudice. The defendants' peremptory exceptions raising the objections of prescription and no cause of action were likewise granted, dismissing with prejudice the claims of Taylor and Ledet, and also those of Jesse and Michelle Foret asserted in the first amended petition for damages. For the following reasons, we affirm.

I. FACTUAL AND PROCEDURAL HISTORY

This is a legal malpractice action. The alleged legal malpractice arose in connection with litigation stemming from a motorboat accident that occurred on July 5, 2003.² On that date, Eva Taylor and Kevin Ledet were passengers in a motorboat operated by Jesse Foret. Foret drove the watercraft into a rock levee while traversing the waterway connecting Bayou Decade to Lake Jug in Terrebonne Parish. Upon impact, all three occupants were thrown overboard and sustained serious injuries.

Following the accident, Foret was arrested and charged with vehicular negligent injuring. He later pled guilty to charges of vehicular negligent injuring and first degree vehicular negligent injuring and was sentenced to a combination of home and weekend incarceration that allowed him to go to work during the week. He was also ordered, as part of his sentence, to pay Taylor and Ledet $10,000 each in restitution. Foret had retained Jerri G. Smitko and the Law Offices of Jerri G. Smitko, APLC ("Smitko") to represent him in connection with the criminal charges. Subsequently, Taylor and Ledet filed two separate civil suits, which were later consolidated, against Foret in the 32nd Judicial District Court. Smitko also represented Foret in those two consolidated cases.

Foret did not have liability insurance that would have compensated Taylor and Ledet for the injuries they sustained as a result of the motorboat accident. As such, Foret retained additional counsel, Camille Saltz Babin ("Babin"), who at the time was employed by Joan Malbrough & Associates, APLC ("Malbrough"), to file a voluntary petition in bankruptcy court in the Eastern District of Louisiana under Chapter 7, 11 U.S.C. § 101.³

Taylor and Ledet filed a separate adversary complaint in bankruptcy court to determine the dischargeability of their claims against Foret. Taylor and Ledet asserted that their claims against Foret were non-dischargeable in bankruptcy pursuant to Section 523 of Title 11 of the United States Code.⁴ On October 7, 2004, the bankruptcy court signed and entered a consent order based upon "joint consent submitted by all parties represented herein," declaring Foret's alleged debt to Taylor and Ledet non-dischargeable under 11 U.S.C.A. § 523(a)(9) and lifting the automatic stay of Taylor and Ledet's state court lawsuits against Foret.

Thereafter, a bench trial on liability alone was held in the 32nd Judicial District Court for the Parish of Terrebonne. Foret was found to have negligently caused the boating accident that injured Taylor and Ledet and to have been intoxicated at the time of the accident. However, the trial court did not find Foret's actions to be wanton or reckless.⁵ Judgment was entered accordingly on February 6, 2006, and Foret, still represented by Smitko, devolutively appealed. This court unanimously affirmed on June 8, 2007. See Taylor v. Foret, 2006-1945, 2006-1946 (La. App. 1st Cir.6/8/07), 958 So.2d 1217(unpublished), writ denied, 2007-1411 (La.10/5/07), 964 So.2d 943.

The argument that legal malpractice was committed is based on the assertion that at the time the consent order was signed in bankruptcy court, 11 U.S.C.A. § 523(a)(9) did not apply to the claims made by Taylor and Ledet. It was alleged that Saltz, Smitko, and Malbrough failed to adequately research whether 11 U.S.C.A. § 523(a)(9) applied to the claims made by Taylor and Ledet. In light of the trial court's ruling that Foret did not act in a wanton or reckless manner, it was alleged that the claims of Taylor and Ledet were dischargeable pursuant to Title 11 of the United States Code.

The petition in the instant suit alleges that on September 22, 2006, Foret discovered that the defendants had committed malpractice.⁶ The petition further alleges that Foret assigned his legal malpractice claims against defendants and their respective law corporations to Taylor and Ledet. Defendants filed various exceptions, but primarily objected to the petition on the basis that the plaintiffs had no right of action to bring this lawsuit, because legal malpractice claims are not assignable under Louisiana law. Thereafter, plaintiffs amended the petition to add Jesse and Michelle Foret as plaintiffs and to bring a new claim for mental anguish.⁷ Following this amended petition, the defendants filed exceptions raising the objections of no cause of action, prescription, and vagueness. By judgment signed on December 5, 2007, the trial court sustained the exceptions, and this appeal followed.

II. NO RIGHT OF ACTION

A. General Legal Precepts

The objection of no right of action tests whether the plaintiff, who seeks relief, is or is not the person in whose favor the law extends a remedy. Howard v. Administrators of Tulane Educational Fund, 2007-2224, p. 16 (La.7/1/08), 986 So.2d 47, 59. The focus in an exception of no right of action is on whether the particular plaintiff has a right to bring suit, but it assumes that the petition states a valid cause of action for some person and questions whether the plaintiff in the particular case is a member of the class that has a legal interest in the subject matter of the litigation. Reese v. State Department of Public Safety and Corrections, 2003-1615, pp. 2-3 (La.2/20/04), 866 So.2d 244, 246.

B. Assignability of Legal Malpractice Claims

In this case, the defendants contend, and the trial court agreed, that the plaintiffs had no right of action to bring this action, because legal malpractice claims are not assignable. Initially, we note that the issue of the assignability of legal malpractice claims is res nova in Louisiana. The plaintiffs argue that legal malpractice claims are assignable under La. C.C. art. 2642 and/or 2044.

First, the plaintiffs contend that rights are generally assignable under Louisiana law, citing La. C.C. art. 2642, which provides:

All rights may be assigned, with the exception of those pertaining to obligations that are strictly personal. The assignee is subrogated to the rights of the assignor against the debtor.

The plaintiffs also assert that the Louisiana Supreme Court has held that actions for the recovery of tort damages are not strictly personal. Since the action herein lies in tort, as it is a claim for loss of money occasioned by legal malpractice, the plaintiffs argue it is, therefore, assignable. In support of this argument, plaintiffs cite Nathan v. Touro Infirmary, 512 So.2d 352 (La.1987), and Guidry v. Theriot, 377 So.2d 319 (La.1979). However, both of these cases involved the inheritability—not the assignability—of medical malpractice actions by a designated beneficiary, after the commencement of an action by the plaintiff tort victim through the filing of a suit or pre-suit complaint. In both cases, the supreme court emphasized the fact that the patients had asserted their rights to recover by filing a claim prior to death, thus creating property rights that were inheritable. Nathan, 512 So.2d at 355.

We find these cases distinguishable from the instant matter in one crucial aspect— the tort victims had asserted their rights prior to death. As noted by the Guidry court, there is a significant difference between inheriting an instituted action and inheriting the right to institute an action. Guidry, 377 So.2d at 324. In this case, we are not confronted with the situation where Foret either instituted a legal malpractice action against his former attorneys and then died or filed suit against the defendants and later transferred his rights to the plaintiffs. Thus, the facts of this case differ from those in Nathan and Guidry and are not controlling precedent.

The plaintiffs also contend that they could have initiated this action on their own behalf, without the disputed assignment of rights, based on La. C.C. art.2044. Louisiana Civil Code article 2044 provides:

If an obligor causes or increases his insolvency by failing to exercise a right, the obligee may exercise it himself, unless the right is strictly personal to the obligor.

For that purpose, the obligee must join in the suit his obligor and the third person against whom that right is asserted.

The plaintiffs assert that, because Foret discovered the legal malpractice on September 22, 2006, yet did not exercise his rights for over eight months, they could have...