STATE OF LOUISIANA COURT OF APPEAL, THIRD CIRCUIT
22-634
CHARLES GUILLORY AND TAMMY GUILLORY
VERSUS
LOUISIANA FARM BUREAU CASUALTY INSURANCE COMPANY
**********
APPEAL FROM THE FOURTEENTH JUDICIAL DISTRICT COURT PARISH OF CALCASIEU, NUMBER 2021-1254 HONORABLE CLAYTON A. DAVIS, DISTRICT JUDGE
SHARON DARVILLE WILSON JUDGE
Court composed of Shannon J. Gremillion, Van H. Kyzar, and Sharon Darville Wilson, Judges.
AFFIRMED. Michael K. Cox Somer G. Brown COX, COX, FILO, CAMEL, WILSON & BROWN, LLC 723 Broad Street Lake Charles, Louisiana 70601 (337) 436-6611 Counsel for Plaintiffs/Appellees: Charles Guillory and Tammy Guillory
Charles C. Garrison Staci Know Villemarette Lauren Camel Begnaud CAFFERY, OUBRE, CAMPBELL & GARRISON, LLP 100 East Vermillion Street, Suite, 201 Lafayette, Louisiana 70501 (337) 446-2442 Counsel for Defendant/Appellant: Louisiana Farm Bureau Casualty Insurance Company
Wayne J. Lee Heather S. Lonian STONE PIGMAN WALTHER WITTMANN, LLC 909 Poydras Street, Suite 3150 New Orleans, Louisiana 70112 (504) 581-3361 Counsel for Defendant/Appellant: Louisiana Farm Bureau Casualty Insurance Company WILSON, Judge.
Louisiana Farm Bureau Casualty Insurance Company (LFBC) appeals
several adverse rulings in this suit for breach of contract, penalties, and attorney
fees regarding LFBC’s handling of a claim for damages resulting from Hurricanes
Laura and Delta. For the reasons that follow, we affirm the trial court’s rulings,
the jury’s verdict and the judgment signed in accordance therewith, and the trial
court’s award of costs.
I.
ISSUES
This appeal presents the following issues:
1. Whether the trial court erred in denying LFBC’s motion to recuse Judge Davis and/or in declining to refer the motion to an ad hoc judge.
2. Whether the trial court correctly instructed the jury as to the legal standard for claims asserted under La.R.S. 22:1973 and/or 22:1892.
3. Whether the jury committed manifest error in finding that each and every payment by LFBC to Plaintiffs was not timely made within thirty days of receiving satisfactory proof of loss.
4. Whether the trial court erred in permitting Plaintiffs to introduce and argue that evidence concerning their withdrawn additional living expenses (ALE) claim as evidence of their alleged mental anguish, while simultaneously preventing LFBC from introducing countervailing evidence on this issue.
5. Whether the trial court erred in awarding costs that are allegedly not recoverable by law.
II.
FACTS AND PROCEDURAL HISTORY
LFBC issued a homeowner’s policy covering the residential property owned
by Charles and Tammy Guillory and located on Oak Park Boulevard in Lake
Charles, Louisiana. The policy had coverage limits of $169,000.00. The property was significantly damaged by Hurricane Laura on August 27, 2020, and by
Hurricane Delta on October 9, 2020.
On or about August 31, 2020, Plaintiffs initiated a claim under their
homeowners policy. LFBC sent its adjuster, Corey Daigle (Daigle), to inspect the
property on September 11, 2020. Plaintiffs contend that this is the date when
LFBC had sufficient proof of loss. Following the inspection, Daigle prepared an
estimate that calculated the replacement cost value of the residence at $51,721.61.
After Hurricane Delta made landfall on October 9, 2020, Plaintiffs contacted
LFBC and reported additional damage to their property. On October 19, 2020,
LFBC adjuster Kris Trahan (Trahan) inspected the property. Daigle and Trahan
consulted with each other regarding their inspections of the property, and Daigle
revised his earlier estimate.
LFBC made the following payments:
$44,370.83 on September 16, 2020 (damages caused by Laura) $15,569.77 on October 19, 2020 (additional damages caused by Delta) $5,440.86 on December 1, 2020 (supplement to roof replacement cost) $25,955.98 on December 8, 2020 (remediation services) $14,000.00 on December 10, 2020 (repairs to air conditioner) $63,662.56 on August 19, 2021 (remaining unpaid dwelling limit) $51,721.61 on October 5, 2021 (contents claim)
Plaintiffs retained the services of a public adjuster, Kermit Sonnier (Sonnier).
Sonnier estimated the replacement value cost at $198,441.66. LFBC then assigned
a claims representative, Chris Fontenot. Fontenot requested copies of any
estimates that Sonnier prepared on behalf of Plaintiffs. In the course of trying to
obtain these estimates, Fontenot was informed that Plaintiffs were represented by
counsel.
On March 31, 2021, Plaintiffs filed a petition for breach of contract,
penalties and attorney’s fees pursuant to La.R.S. 22:1973 and 22:1892. They
alleged that LFBC failed to pay all amounts owed under the policy within sixty
2 days after LFBC received satisfactory proof of loss and underpaid their claims.
Plaintiffs alleged that this failure resulted in significant delays in their being able to
return to their home, thereby causing them severe anxiety, mental anguish, and
emotional distress. They further alleged that LFBC failed to compensate them for
their additional living expenses, but this claim was later dismissed.
On May 4, 2022, the 1442 deposition of LFBC was to take place. Plaintiffs
got a subpoena requiring LFBC to produce certain financial documents that were
not listed on the original notice of deposition. LFBC moved to quash the subpoena.
The trial court denied the motion, and LFBC applied for writs to this court. This
court denied the request for a stay and denied the writ application. Guillory v. La.
Farm Bureau Cas. Ins. Co., 22-286 (La.App. 3 Cir. 5/11/22) (unpublished writ
decision), writ denied, 22-758 (La. 5/11/22). The Louisiana Supreme Court also
denied the request for stay and denied writs.
On May 3, 2022, LFBC filed a motion to recuse Judge Davis based on
certain adverse rulings and based on the assertion that Plaintiffs’ attorneys had
contributed 72.73% of the total contributions to Judge Davis’ campaign to get
elected to the Third Circuit in November of 2022. Judge Davis denied the motion
to recuse as untimely. No writ applications were taken with regard to the denial of
the motion to recuse.
The matter proceeded to trial by jury on May 19, 2022. The jury found in
favor of Plaintiffs. The jury specifically found that the payments (except those on
September 16, 2020, and October 5, 2021) were not made within thirty days of
LFBC’s receipt of satisfactory proof of loss and that such failure was arbitrary and
capricious. The jury found those payments were also not paid within sixty days of
satisfactory proof of loss. The jury awarded $65,000.00 to each Plaintiff for
mental anguish and emotional distress and statutory penalties in the amount of
3 $260,000.00. Plaintiffs’ counsel was awarded attorney’s fees in the amount of
$152,978.60, and Farm Bureau was taxed with all costs. On July 5, 2022, the trial
court signed a judgment in accordance with the jury’s verdict. Farm Bureau now
appeals.
III.
LAW AND DISCUSSION
Motion to Recuse
We must first determine whether the trial court correctly denied LFBC’s
motion to recuse Judge Davis as untimely. Louisiana Code of Civil Procedure
Article 154(A) provides that the motion to recuse must be filed:
no later than thirty days after discovery of the facts constituting the ground upon which the motion is based, but in all cases prior to the scheduling of the matter for trial. In the event that the facts constituting the ground upon which the motion to recuse is based occur after the matter is scheduled for trial or the party moving for recusal could not, in the exercise of due diligence, have discovered such facts, the motion to recuse shall be filed immediately after such facts occur or are discovered.
If the motion to recuse is untimely, the trial court can deny the motion without the
appointment of an ad hoc judge or hearing, but in that case, the trial judge “shall
provide written reasons for the denial.” La.Code Civ.P. art. 154(C). Judge Davis
denied the motion as untimely and filed written reasons in accordance with Article
154.
The notice of jury trial in this case is dated April 26, 2022. This motion to
recuse was not filed until a few days before trial in what the trial court and
Plaintiffs characterized as an attempt to get a continuance after their motion to
continue the trial date was denied during a conference call on March 31, 2022.1
1 The motion to continue did not include a rule to show cause and instead contained a decree rescheduling the trial date. That portion of the motion was lined through by the trial court with annotation that the motion was denied. In the written reasons for the denial of the motion to 4 LFBC alleges it was not aware of the contributions to Judge Davis’
campaign by Cox, Cox, Filo, Camel, Wilson & Brown, LLC, until shortly before
its motion was filed, but Plaintiffs assert that in the exercise of due diligence, as
required by La.Code Civ.P. art. 154(A), LFBC should have known about the
contributions because such information was publicly available. The comments to
Article 154 warn against “a late-filed motion to recuse as a manner of obtaining a
continuance of the trial.”
Here, LFBC relies on Riddle v. Premier Plaza of Monroe, LLC, 51,173
(La.App. 2 Cir. 2/15/17), 216 So.3d 170, to relieve them of their burden of due
diligence by asserting that Plaintiffs and the trial judge were in the best position to
recognize a potential conflict that would merit recusal and should have disclosed
this fact to LFBC. In that case, the trial judge was a member of the board of the
Monroe Symphony Orchestra, which was the organization for which the plaintiff
had been hired to direct a fund-raising event and against whom the plaintiff filed a
breach of contract action that was pending before the trial judge. The Riddle case
is distinguishable since it involved a petition to annul a judgment that Riddle
alleged was obtained by fraud or ill practices perpetrated by the trial judge who
dismissed her suit.
In Langlinais v. Union Oil Co. of Ca., 20-229 (La. 5/14/20), 296 So.3d 601,
the motion to recuse was filed on June 28, 2019, over a year after the suit was filed,
and nearly three years after the campaign advertisement, which mentioned the
plaintiffs’ counsel, was published. The plaintiffs’ counsel admitted that they were
aware of the advertisement in April of 2018 when they first filed suit. The
Supreme Court found that the motion to recuse was untimely.
recuse, the trial court noted that LFBC did not object to the informal handling of the motion in the conference call. 5 In this case, the Candidate’s Report filed by Judge Davis was attached to
LFBC’s motion to recuse. That report was filed on January 13, 2022, and the
report indicates that the contributions in question were made on November 9, 2021.
Thus, it is clear that the facts that form the basis for the motion to recuse were
discoverable on January 13, 2022. Louisiana Code of Civil Procedure Article
154(A) requires the exercise of due diligence. Thus, we agree with the trial court
that the exception provided in Article 154 is not applicable to extend the thirty-day
time period because the facts that LFBC allege as the grounds for recusal were
discoverable, with the exercise of due diligence, before this matter was set for trial.
“[T]he applicable standard of review of the recusal issue is one for abuse of
discretion.” Menard v. Menard, 19-580, 19-581, p. 19 (La.App. 3 Cir. 3/11/20),
297 So.3d 82, 95. We find no abuse of discretion in either the trial court’s failure
to refer the matter to an ad hoc judge for hearing or the trial court’s denial of the
motion to recuse as untimely. Therefore, we need not consider the merits of the
motion.
Jury Instructions
LFBC asserts that the trial court failed to properly instruct the jury as to the
definition of the term “arbitrary and capricious” as used in La.R.S. 22:1973 and
La.R.S. 22:1892. LFBC’s proposed jury instruction number two stated:
An “arbitrary” act is one “based on random choice or personal whim, rather than reason or system[.]”[] Capricious is “given to sudden and unaccountable changes in behavior.” The phrase “arbitrary, capricious, or without probably cause” is synonymous with “vexatious,” and a “vexatious refusal to pay” means “unjustified, without reasonable or probable cause or excuse[.]”[]
Proposed jury instruction number three stated: “Arbitrary and capricious describes
an insurer whose willful refusal of a claim is not based on a good faith defense.”
Proposed jury instruction number five stated: “When there are substantial,
6 reasonable and legitimate questions as to the extent of an insurer’s liability or an
insured’s loss, the insurer’s failure to pay within the statutory time period is not
arbitrary, capricious or without probable cause.”
Louisiana Code of Civil Procedure Article 1793(C) provides, in pertinent
part, that: “A party may not assign as error the giving or failure to give an
instruction unless he objects thereto either before the jury retires to consider its
verdict or immediately after the jury retires, stating specifically the matter to which
he objects and the grounds of the objection.” “[O]ff-the-record objections are
insufficient.” Libersat v. J&K Trucking, Inc., 00-192, p. 5 (La.App. 3 Cir.
10/11/00), 772 So.2d 173, 176, writ denied, 01-458 (La. 4/12/01), 789 So.2d 598.
In this instance, the record reflects that defense counsel specifically objected
to the trial court’s failure to include LFBC’s proposed jury instruction number
eleven 2 and to the inclusion of Plaintiffs’ third supplemental and proposed jury
instruction.3 While the charge conference was not transcribed, the trial transcript
reflects that objections to the jury charges were made on the record. Defense
counsel’s objections make no mention of the requested jury instructions that are
the basis of this assignment of error.
In Libersat, this court exercised its discretion to review the defendant’s
objections to the jury instructions because the trial court made statements that
caused the defense to erroneously believe that their objections, which were made
during an off-the-record charge conference, were being preserved for review. That
is not the case here. The record reflects that defense counsel was given the
2 LFBC’s proposed jury instruction number eleven reads: “An insured who fails to provide his insurer with information required to process his claim cannot then claim the insurer acted arbitrary in delaying payment.” 3 Plaintiffs’ third supplemental and proposed jury instructions reads: “Statutory penalties, if awarded, shall not be used by the insurer in computing either past or prospective loss experience for the purpose of setting rates or making rate filings.” 7 opportunity to make his objections on the record and did so with respect to two
separate charges. No blanket objection to the charges was made, and defense
counsel made no objection to the trial court’s failure to include proposed jury
instructions numbers two, three, and five. Therefore, we find that this assignment
of error is not properly before this court as it was not preserved for review.
Timeliness of Payments
“The determination of whether [an insurer] acted in an arbitrary and
capricious manner or in bad faith in its refusal to fairly and quickly settle its
insured’s claim is a question of fact which will be reviewed on appeal under the
manifest error standard of review.” Urrate v. Argonaut Great Cent. Ins. Co., 04-
256, p. 7 (La.App. 5 Cir. 8/31/04), 881 So.2d 787, 791, writs denied, 04-2644, 04-
2685 (La. 01/07/05), 891 So.2d 686, 690. This court “may not set aside a trial
court’s or a jury’s finding of fact in the absence of ‘manifest error’ or unless it is
‘clearly wrong.’” Stobart v. State through Dept. of Transp. & Dev., 617 So.2d 880,
882 (La.1993). Thus, in order to reverse the jury’s verdict, this court must find: (1)
that record does not reflect a reasonable factual basis for the finding of fact; and (2)
that the record establishes that the finding of fact is clearly wrong. Id.
LFBC asserts that the jury’s conclusion that LFBC’s payments to Plaintiffs
were untimely is not supported by the evidence or testimony in this case. LFBC
argues that the “overwhelming evidence” shows that it promptly inspected the
property and issued payment upon receipt of satisfactory proof of loss well within
the time limits imposed by La.R.S. 22:1973 and 22:1892. Specifically, LFBC
points to the testimony of Daigle regarding the inspection of the property in
September 2020, in the presence of Plaintiffs. Daigle testified that he included all
visible damages that they observed in his estimate and that Plaintiffs did not
contact him to inform him of anything left out of the estimate. LFBC also alleges
8 that it presented uncontested testimony and documentary evidence that the post-
Delta October 19, 2020 payment was issued on or about the same day as Trahan’s
inspection. LFBC also argues that the December 1, 2020 supplemental payment
was issued the same day that it received the invoice for the full roof replacement;
that the December 8, 2020 payment was issued the same day that Plaintiffs
submitted the invoice for remediation services; that the December 10, 2020
payment was issued the same day that the invoice for air conditioner repairs was
submitted; and that the August 19, 2021 payment was made after it decided to
issue a payment for the remainder of the Coverage A policy limits to resolve the
claim. According to LFBC, the only significant delays in processing this claim
resulted from Sonnier’s arbitrary and capricious failure to submit his estimate
despite numerous requests.
Plaintiffs argue, on the other hand, that LFBC’s argument concerning the
timeliness of its payments fails based on what constitutes satisfactory proof of loss
under Louisiana law. The statutory obligation to inspect the property and provide
payment for the undisputed damages rests on the insurer, and Plaintiffs point out
that LFBC’s argument improperly shifts the burden to them or to the public
adjuster that they hired. However, “[t]he party claiming entitlement to penalties
and attorney fees for bad faith claims handling has the burden of proving: (1) the
insurer received satisfactory proof of loss; (2) the insurer failed to pay the claim
within the applicable statutory period; and (3) the insurer’s failure to pay was
arbitrary.” Aghighi v. La. Citizens Prop. Ins. Corp., 12-1096, p. 4 (La.App. 4 Cir.
6/19/13), 119 So.3d 930, 933, writ denied, 13-1737 (La. 10/30/13), 124 So.3d 1102.
“Satisfactory proof of loss . . . is that which is sufficient to fully apprise the insurer
of the claim and extent of the damage.” Id. at 934.
9 “A personal inspection of an insured’s property by an adjuster for the
insurance company also constitutes satisfactory proof of loss.” J.R.A., Inc. v. Essex
Ins. Co., 10-797, pp. 32-33 (La.App. 4 Cir. 5/27/11), 72 So.3d 862, 881.
The insurer’s duty under La.R.S. 22:1892 mandates more than merely sending an adjuster to the insured’s property to take pictures and calculate numbers on less than all the damage. It would defeat the purpose of the statute to allow an inadequate and unreasonably low adjustment, done within the requisite time delays, to satisfy the insurer’s obligation to the insured. Likewise, allowing a “readjustment” done approximately six months later to cure the original bad conduct without any penalty would be condoning the insurer’s actions.
Aghighi, 119 So.3d at 935.
In this case, the jury concluded that LFBC had satisfactory proof of loss at
the time of its original inspection, and we find no manifest error in the jury’s
finding. Although LFBC assigns as error that the jury abused its discretion by
awarding excessive damages and statutory penalties, it does not argue this point in
brief. We, therefore, consider this assignment of error to be abandoned. Uniform
Rules of Court—Courts of Appeal, Rule 2–12.4(B)(4).
Admissibility of Evidence of Additional Living Expenses
LFBC argues that the trial court abused its discretion by permitting Plaintiffs
to present evidence and argument concerning their voluntary decision to live in a
camper on their own property in support of their claim for bad faith while denying
LFBC the opportunity to fully cross examine plaintiffs and to present evidence to
contradict Plaintiffs’ testimony. Specifically, LFBC argues that Plaintiffs
withdrew their claims for additional living expenses because they were not entitled
to recover them under the terms of the policy such that any testimony in this regard
was irrelevant. LFBC also argues that it was not allowed to question Plaintiffs
regarding Mrs. Guillory’s claim for mental anguish damages in a separate lawsuit
seeking to recover for hurricane related damages to her beauty salon. But, as
10 pointed out by Plaintiffs, Mrs. Guillory did testify that the damage to her salon
caused her stress and anxiety.
Plaintiffs assert that the evidence that they were not able to live in their
home for nearly two years after the hurricanes because of LFBC’s failure to
reasonably and timely compensate them for repairs to their home was introduced to
show the anguish associated with seeing it in disrepair for such a long time.
It is well settled that it is proper to award damages for mental anguish
resulting from an insurer’s breach of its duties. Orellana v. La. Citizens Prop. Ins.
Co., 07-1095 (La.App. 4 Cir. 12/5/07), 972 So.2d 1252, writ denied, 08-41 (La.
10/24/08), 25 So.3d 777. In Orellana, the court noted that the plaintiff “had to
watch his home sustain ongoing damage as a result of Louisiana Citizens’ decision
to not pay timely insurance payments[.]” Id. at 1256 (footnote omitted). For these
reasons, we find that Plaintiffs’ testimony was relevant to their claims for mental
anguish damages and that the trial court did not abuse its discretion in allowing it.
Costs
“The district court has great discretion in awarding costs, including expert
witness fess, deposition costs, exhibit costs, and related expenses.” Reynolds v. La.
Dept. of Transp., 15-1304, p. 4 (La.App. 1 Cir. 4/16/16), 194 So.3d 56, 59. The
trial court’s assessment of costs will not be disturbed on appeal absent an abuse of
discretion. Id.
The trial court taxed “all costs of the prosecution of the claims by [P]lantiffs”
to LFBC. In addition to those costs, the trial court taxed a total of $16,875.88,
which included expert fees and fees for depositions and exhibits used at trial, as
additional costs that LFBC was required to pay. The judgment specifically
identified those amounts.
11 LFBC argues that several of those items are not taxable under La.Code
Civ.P. art. 1920. Specifically, LFBC takes issue with certain costs it identifies as
unnecessary, including amounts for exhibits and depositions that were not used at
trial. LFBC also objects to the expenses associated with the mock jury and the jury
consultant. LFBC argues that these items are not recoverable under La.Code Civ.P.
art. 1920.
“Except as otherwise provided by law, the court may render judgment for
costs, or any part thereof, against any party, as it may consider equitable pursuant
to La.C.C.P. art. 1920, which has been liberally interpreted as granting broad
discretion to the trial court.” Carr & Assoc., Inc. v. Jones, 22-946, p. 8 (La. App. 1
Cir. 5/10/23), ___ So.3d ___. “[T]he only costs which can be taxed against a
litigant are those specifically provided for by statute.” Id. “The costs of the clerk,
sheriff, witness’ fees, costs of taking depositions and copies of acts used on the
trial, and all other costs allowed by the court, shall be taxed as costs.” La.R.S.
13:4533 (emphasis added). The jurisprudence recognizes that “the positive law in
this instance allows for discretion on the part of the trial court to set costs other
than those specifically enumerated, as equitable.” Barre-Williams v. Ware, 20-665,
p. 6 (La.App. 4 Cir. 4/28/21), 365 So.3d 760, 769. There is support in the
jurisprudence for the award of costs for depositions not introduced at trial. For
example, in Butler v. LAMMICO, 15-1191, p. 10 (La.App. 4 Cir. 5/25/16), 195
So.3d 570, 577, the court stated that: “costs necessary to bring a case to trial,
though not expressly introduced into evidence, are within the trial court’s
discretion to tax.” “[T]he trial court judge is in a better posture to determine what
costs were necessary to bring the case to trial.” Id. We find that the same
reasoning applies to the expenses incurred for the mock trial and jury consultant.
12 Louisiana Revised Statutes 22:1892(B)(1)(a) provides for a penalty, attorney
fees, and costs. Plaintiffs argue that this allows the recovery of all costs incurred
by a plaintiff, without restriction to the ordinary taxable costs, as a penalty and that
to interpret the use of the term “costs” in La.R.S. 22:1892 as limited to those
allowable in any suit would render its use meaningless and superfluous. We agree
and affirm the entirety of the trial court’s award of costs in this matter.
IV.
CONCLUSION
For the foregoing reasons, we affirm the denial of the motion to recuse, the
jury’s verdict and the trial court’s judgment signed in accordance therewith, and
the trial court’s award of costs. All costs of this appeal are assessed to the
Defendant/Appellant, Louisiana Farm Bureau Casualty Insurance Company.
AFFIRMED.