Defraites v. State Farm Mutual Automobile Insurance Co.

44 So. 3d 762, 10 La.App. 5 Cir. 78, 2010 La. App. LEXIS 969, 2010 WL 2595183
CourtLouisiana Court of Appeal
DecidedJune 29, 2010
DocketNo. 10-CA-78
StatusPublished
Cited by1 cases

This text of 44 So. 3d 762 (Defraites v. State Farm Mutual Automobile Insurance Co.) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Defraites v. State Farm Mutual Automobile Insurance Co., 44 So. 3d 762, 10 La.App. 5 Cir. 78, 2010 La. App. LEXIS 969, 2010 WL 2595183 (La. Ct. App. 2010).

Opinions

SUSAN M. CHEHARDY, Judge.

[ 2This is a class action lawsuit that comes before us on appeal of the trial court’s denial of the plaintiffs motion to alter the class definition. We affirm and remand for further proceedings.

FACTS AND PROCEDURAL HISTORY

On July 1, 2002, Robert Defraites’ vehicle was damaged in an accident with a vehicle owned by Oasis Horticultural Services, Inc., operated by an Oasis employee. The Oasis vehicle was insured by State Farm Mutual Automobile Insurance Company. Defraites filed suit on August 2, 2002, alleging that his vehicle sustained damage not only in cost of repairs, but also in diminished value attributable to the vehicle’s involvement in the accident, and that State Farm paid for the costs to repair his vehicle, but failed to pay for the vehicle’s diminished value.

Defraites alleged he made a claim for diminution in value of the vehicle, but State Farm failed to initiate loss adjustment for this item of damages within fourteen days of the notification of loss. De-[764]*764fraites asserted that State Farm violated the provisions of La. R.S. 22:658(A)(3) and (4) (now La. R.S. 22:1892), and was therefore liable for the amount of diminution in value sustained by | .¡plaintiff as well as damages in the form of penalties pursuant to La. R.S. 22:1220(0 (now La. R.S. 22:1973).1

Defraites requested that the suit be certified as a class action on behalf of all similarly situated persons who have made or will henceforth make third-party automobile property damage claims against State Farm and its insureds for damages sustained, in which State Farm failed to pay losses for diminution in value. He named as defendants Oasis, State Farm, and the class of persons insured through State Farm and situated similarly to Oasis, but yet to be identified. His proposed defendant class was to be comprised of the past and future State Farm insureds who are targets of the vehicular property damage claims asserted by members of the putative plaintiffs’ class.

The district court initially certified the matter as a class action. On a prior appeal, however, this Court reversed the certification and remanded the matter for further proceedings. Defraites v. State Farm Mut. Auto. Ins. Co., 03-1081 (La.App. 5 Cir. 1/27/04), 864 So.2d 254, writ denied, 2004-0460 (La.3/12/04), 869 So.2d 832 (hereafter “Defraites I”). In Defraites I we determined that Defraites could not use the class action procedure to seek injunctive and declaratory relief and statutory penalties because the nature of this action does not meet the requirements of La. C.C.P. art. 591(B)(2).

Thereafter Defraites amended his petition, seeking to certify a class to seek injunctive and declaratory relief without a claim for statutory penalties.

State Farm filed a motion to dismiss and also filed an exception of res judicata, citing law-of-the-case doctrine. The trial court denied both the motion to |4dismiss and the exception of res judicata. State Farm sought supervisory review, but this Court denied the writ application, as did the supreme court. Defraites v. State Farm Mut. Auto. Ins. Co., 04-1479 (La.App. 5 Cir. 1/13/05) (unpublished writ disposition), writ denied, 2005-0381 (La.4/29/05), 901 So.2d 1065 and 901 So.2d 1066 (hereafter “Defraites II ”).

The trial court thereafter denied re-certification of the class on the amended petition. Defraites sought review, but the writ application was denied. Defraites v. State Farm Mut. Auto. Ins. Co., 07-261 (La.App. 5 Cir. 5/7/07) (unpublished writ disposition), writ denied, 2007-1196 (La.10/5/07), 964 So.2d 939 (hereafter “Defraites III ”).

Defraites subsequently filed a Motion to Alter the Constituency of the Plaintiff Class and Issues to Be Decided on a Class Wide Basis (hereafter referred to as “Motion to Alter”). Defraites’ Motion to Alter seeks to re-certify one plaintiff class for declaratory and injunctive relief under La. C.C.P. art. 591(B)(2), based on violation of La. R.S. 22:1892(A)(4) caused by State Farm’s alleged methodical failure to make written offers to settle third-party diminished value property damage claims within [765]*76530 days after receipt of satisfactory proofs of loss.2

According to Defraites, “[t]he Motion to Alter raises substantive issues as to whether State Farm’s practices regarding diminished value claims violates La. R.S. ]s22:1892 A(4), only. Class wide relief is restricted to written offers to settle. Class claims for La. R.S. 22:1892 A(3) initiation of loss adjustment of diminished value and for La. R.S. 22:1973 C statutory penalties as well as compensatory damages are removed.” Defraites asserts these limitations are sufficient to make the altered constituency an appropriate class.

Defraites seeks a declaration that State Farm has a legal duty to adjust for the diminished value of a vehicle once State Farm has been provided notice of a loss claim, i.e., a cost-of-repair estimate for each putative class member. Defraites relies on Louisiana law providing that diminution in value of a vehicle involved in an accident is an element of recoverable damages if sufficiently established.

The trial court rendered judgment denying the Motion to Alter as follows:

The Court finds that the essence of the proposed class definition remains unchanged. This Court’s holding follows the Fifth Circuit’s earlier decision in this case when it stated that, “Louisiana law does not presume that there is inherent diminution in value involved in every automobile accident.”3

That ruling is the subject of this appeal.4

ASSIGNMENTS OF ERROR

Defraites assigns the following as errors: (1) the trial court abused its discretion in denying class certification because it resulted from a misapplication of La. R.S. 22:1892(A) and was an unwarranted departure from the guidance offered in [766]*766Defraites I and Defraites II; (2) the trial court abused its discretion because all prerequisites identified in La. C.C.P. art. 591(A) are satisfied and State Farm’s systematic violation of La. R.S. 22:1892(A)’s statutory protections |fiqualifíes as a refusal to act on grounds applicable to the entire class, making declaratory and/or injunctive relief appropriate to the class as a whole, as contemplated by La. C.C.P. art. 591(B)(2).

Defraites argues the Motion to Alter raises substantive issues as to whether State Farm’s practices regarding diminished value claims violates La. R.S. 22:1892(A)(4) only. He asserts that class-wide relief is restricted to written offers by State Farm to settle, while class claims for initiation of loss adjustment of diminished value and for statutory penalties as well as compensatory damages are removed.

In opposition State Farm asserts the judgment must be affirmed because there is no abuse of discretion. State Farm contends that Defraites’ substantive claims, underlying premise of the class, and demands for relief remain unchanged and that Defraites I is controlling. Further, State Farm argues, not only the two district court judges who have made rulings, but also this Court, have found De-fraites’ claims improper for class certification, because the putative plaintiffs’ class does not meet the requirements of La. C.C.P. arts. 591(A) and 591(B)(2).

LAW AND ANALYSIS

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Bluebook (online)
44 So. 3d 762, 10 La.App. 5 Cir. 78, 2010 La. App. LEXIS 969, 2010 WL 2595183, Counsel Stack Legal Research, https://law.counselstack.com/opinion/defraites-v-state-farm-mutual-automobile-insurance-co-lactapp-2010.