EZELL, Judge.
Towing and Recovery Professionals of Louisiana Trust appeals a judgment of the trial court finding that it was estopped from raising the defense of no right or no cause of action. It argues that it is a public liability trust and not an insurer, and therefore there is no right to bring a direct action against it under La.R.S. 22:1269. It also claims that the trial court erred in awarding Plaintiff interest from the date of judicial demand.
Raymond Charles was severely injured when a tow truck owned by J.C.'s Wrecker Service, Inc. rear-ended his vehicle on September 14, 2006. Mr. Charles filed suit on September 7, 2007, against J.C.'s, the driver of the tow truck, and Towing and Recovery Professionals of Louisiana (TRPL) Trust incorrectly named as `Towing and Recovery Professionals of Louisiana, Inc.'. In the petition, Mr. Charles alleged that TRPL Trust was an insurer doing business in Louisiana and had in full force and effect a policy of general liability insurance insuring the tow truck.
TRPL Trust answered the appeal asserting that its correct name was Towing and Recovery Professionals of Louisiana Trust. However, it also admitted that it was an insurer and that it issued an insurance policy to J.C.'s.
On May 24, 2010, TRPL Trust filed a notice in the record that it had filed a petition for Chapter 11 bankruptcy in federal court on May 17. On November 15, 2010, TRPL Trust filed a notice of removal to federal court. In response, Mr. Charles filed a motion to remand, which was granted by the federal court on February 17, 2011. Mr. Charles then filed a motion for summary judgment on liability and insurance coverage on June 22, 2011. On June 29, 2011, TRPL Trust filed an exception of no right or no cause of action alleging that it is not an insurance company and is not subject to the Louisiana Direct Action Statute.
A hearing was held on August 22, 2011. Mr. Charles's motion for summary judgment on the issue of liability was granted but was denied as to insurance coverage.
A hearing was held on February 6, 2012, on TRPL Trust's exception of no right or no cause of action. The trial court agreed that TRPL Trust was a trust and not an insurer. However, the trial court ruled that TRPL Trust was estopped from claiming an exemption from direct action and denied its peremptory exception of no right or no cause of action. Judgment denying the exception was signed on February 12, 2012.
At the same hearing, the court received evidence concerning Mr. Charles's injuries. After considering the evidence presented by Mr. Charles, the trial court awarded him $400,000 plus costs and interest from the date of judicial demand until paid. Judgment against J.C.'s, the tow truck driver, and TRPL Trust was signed on March 8, 2012. TRPL Trust then filed the present appeal.
TRPL Trust argues that the trial court erred in denying its exception of no right of action and rendering judgment directly against it. TRPL Trust asserts that it is a public liability trust, not a licensed insurer, and that the Louisiana Direct Action Statute is not applicable to Mr. Charles's claims.
The Louisiana Direct Action Statute refers to a right of direct action, and a defendant challenging a plaintiff's right to proceed under the Louisiana Direct Action Statute should do so by means
The supreme court explained the appellate review of a ruling on an exception of no right of action in Eagle Pipe & Supply, Inc. v. Amerada Hess Corp., 10-2267, 10-2272, 10-2275, 10-2279, 20-2289, pp. 6-7 (La. 10/25/11), 79 So.3d 246, 255-56:
Whether a person has a right to bring an action raises a question of law. Id. "A question of law requires a de novo review." Id. at 256.
At the time of the accident in 2006, La.R.S. 22:46(9)(d)
The Louisiana Direct Action Statute, La. R.S. 22:1269, is found in Part IV of Chapter 4, not one of the sections that a professional, trade and occupational, or public liability trust fund was subject to at the time of the accident.
TRPL Trust was established as a public liability trust on February 25, 2004. The agreement to act as a public liability trust was filed with the Commissioner of Insurance. As such, it was not subject to the Louisiana Direct Action Statute.
Recognizing that TRPL Trust is a public liability trust not subject to direct action, Mr. Charles argues that TRPL Trust is estopped from any argument that it is a public liability trust not subject to direct action because of its prior representations, judicial admissions, and litigation tactics. Specifically, Mr. Charles claims that TRPL Trust repeatedly admitted that it was an insurer. He also claims that it utilized its status as a direct action insurance company defendant to file a stay in the trial court due to bankruptcy proceedings and to remove the present action to federal court.
Equitable estoppel is a jurisprudential doctrine in which the voluntary
While it is true that TRPL Trust admitted it was an insurer, it also stated that its correct name is "Towing and Recovery Professional of Louisiana Trust" in its initial answer to the petition for damages. In his petition, Mr. Charles had referred to it as "Towing and Recovery Professionals of Louisiana, Inc." This should have put Mr. Charles on notice of the trust status. While TRPL incorrectly admitted that it was an insurance company, there is no indication that TRPL Trust purposefully misled Mr. Charles. On October 12, 2007, Plaintiff was provided a copy of the coverage agreement which evidenced that TRPL Trust was not covered by LIGA in the event of insolvency and also described how legal action could be taken against TRPL Trust.
If Mr. Charles had never filed suit against TRPL Trust, it still would have been in bankruptcy proceedings by May 2010, prior to the trial of matter. On November 16, 2009, Mr. Charles filed an unopposed motion to re-fix the trial scheduled for January 11, 2010. The trial was then re-fixed to July 6, 2010. By the time of the new trial date, TRPL Trust was already in bankruptcy proceedings. It was Plaintiff himself that rescheduled the original trial date.
On March 25, 2010, J.C.'s and the driver of the tow truck filed an unopposed motion to continue and re-fix for trial because Mr. Charles had undergone additional back evaluations and additional testing had been recommended. Anticipating additional discovery after the testing, both parties requested a trial date in 2011 due to conflicts by both parties with the dates available in 2010. Trial was then set for January 10, 2011.
In the meantime, TRPL Trust had the case removed to federal court. Mr. Charles's motion to remand was set for January 20, 2011, so the case was rescheduled. Following the remand, the case was set for trial on September 6, 2011. Following the filing of Mr. Charles' motion for summary judgment and TRPL Trust's exception of no right or cause of action, J.C.'s and the tow truck driver filed an unopposed motion to continue trial because Mr. Charles did not timely provide them with the written reports prepared by Mr. Charles's non-medical witnesses. Trial was then set for February 6, 2012, at which time the exception of no right or no cause of action was heard and ruled upon. Due to stipulation of counsel, Mr. Charles submitted his evidence on damages with the trial court taking the matter under advisement.
As can be seen, trial of this matter was delayed due to conflicts and further testing. If trial had proceeded on July 6, 2010, as re-fixed by Mr. Charles, TRPL
Our decision on the exception pretermits our consideration of the issue of the award of interest from the date of judicial demand.
For the foregoing reasons, judgment of the district court denying Towing and Recovery Professionals of Louisiana Trust's exception of no right of action and rendering judgment against it is reversed. Judgment is rendered in favor of Towing and Recovery Professionals of Louisiana Trust and against Raymond Charles, sustaining the peremptory exception of no right of action and dismissing Raymond Charles's claims against it. All costs of this appeal are assessed to Raymond Charles.
COOKS, J., dissents.
COOKS, J. Dissents.
Raymond Charles (Plaintiff) was awarded $400,000.00 in damages, plus costs, and interest from date of judicial demand, for injuries sustained in an accident with a tow truck owned by J.C.'s Wrecker Service, Inc. (J.C.'s). That judgment is not before us on appeal.
The majority recognizes the following individual facts. Towing and Recovery Professionals of Louisiana Trust (Towing and Recovery): (1) Admitted in judicial pleadings that it was an insurer; (2) represented in judicial pleadings it issued a general liability insurance policy which it judicially admitted covered J.C.'s tow truck; (3) used its feigned status as a direct action insurance company as the basis to attempt removal of the case to federal court; and (4) used its feigned status as a direct action insurance company to file a stay in the trial court when it filed federal bankruptcy proceedings. Nevertheless, the majority finds the trial court erred in finding Towing and Recovery is estopped from claiming exemption from the direct action statute because it is a trust not an insurer. I disagree.
The trial court properly denied Towing and Recovery's exceptions of no right of action and no cause of action. The trial court found that as matter of law Towing and Recovery is a trust, not an insurer.
The majority ignores a long line of state and federal jurisprudence which supports the propriety of the trial court's ruling as a matter of law. Relying on the decision in Gunderson v. F.A. Richard & Associates, 09-1498 (La.App. 3 Cir. 8/25/10), 44 So.3d 779, the majority finds that estoppel cannot be applied when "in conflict with positive law." Id. at 789. This is a complete misapplication of the principle enunciated in Gunderson, and cases cited therein, and in La. Civ.Code art. 4 which provides:
In Gunderson, the court faced a completely different scenario than in the present case. In that case, the defendants were statutorily required to give adequate prior notice to the plaintiff healthcare providers of their intent to reimburse them at a lower PPO rate than the higher workers' compensation rate for injured workers. This court held the plaintiffs were not estopped from suing the defendants for payments at the higher rate just because the plaintiffs' did not use their provider agreements to mitigate their damages. We found the defendants in Gunderson could not employ equitable estoppel as a defense to their positive statutory duty of notice and disclosure. That is quite different than the case before us. Here, the majority fails to employ estoppel to the very kind of circumstance the doctrine envisions. As Louisiana Civil Code article 4 expressly states, equitable estoppel requires that this court "resort to justice [and] reason" to determine if Towing and Recovery should be estopped from invoking its status as a trust when it repeatedly and deliberately masqueraded as an insurer in judicial pleadings throughout the litigation until it could gain an advantage over the Plaintiff by now asserting it is a trust, not an insurer, in bankruptcy proceedings. This is the very type of behavior judicial estoppel prohibits.
Ark-La-Tex Timber Co., Inc. v. General Electric Capital Corp., 482 F.3d 319, 332 (5th Cir.07) (emphasis added).
Humble Oil v. Boudoin, 154 So.2d 239, 250 (La.App. 3 Cir.1963), writ refused by 245 La. 54, 156 So.2d 601 (La.1963) (emphasis added).
As the Unites States Fifth Circuit plainly said it:
Kane v. Natl. Union Fire Ins. Co., 535 F.3d 380, 385 (5th Cir.2008) (emphasis added).
Towing and Recovery played "fast and loose" in these judicial proceedings and gained an advantage over the injured Plaintiff in the bankruptcy proceedings. As a result of Towing and Recovery's false representations used to its advantage when it suited its goals in the litigation, Plaintiff has been put in an unfavorable position as a judgment creditor in the bankruptcy proceedings which works to his detriment in his ability to recover all or perhaps any of his substantial judgment for his injuries. This is not countenanced in our law but is allowed by the majority through its misplaced reliance on the notion that positive law precludes application of equitable estoppel. The jurisprudence does not support the majority's conclusion. As the United States Fifth Circuit Court of Appeals points out in Kane, the courts recognize three factors in determining the applicability of equitable estoppel:
Kane, 535 F.3d at 385-86.
Towing and Recovery's masquerade as an insurer meets these requirements in this case: (1) Its original position in multiple judicial pleadings and procedures is "clearly inconsistent" with its later position that it is not an insurer; (2) the court in more than one instance accepted Towing and Recovery's misrepresentation that it was an insurer and had issued an insurance