Hemmans v. State Farm Ins. Co.

653 So. 2d 69, 10 I.E.R. Cas. (BNA) 664
CourtLouisiana Court of Appeal
DecidedMarch 21, 1995
Docket94-CA-0496
StatusPublished
Cited by5 cases

This text of 653 So. 2d 69 (Hemmans v. State Farm Ins. 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
Hemmans v. State Farm Ins. Co., 653 So. 2d 69, 10 I.E.R. Cas. (BNA) 664 (La. Ct. App. 1995).

Opinion

653 So.2d 69 (1995)

Charles A. HEMMANS
v.
STATE FARM INSURANCE COMPANY, Robert West, Carl W. Mixon, G. Michael Cohen and Guy Barr.

No. 94-CA-0496.

Court of Appeal of Louisiana, Fourth Circuit.

March 21, 1995.
Rehearing Denied April 10, 1995.
Writ Denied June 23, 1995.

*70 Robert K. McCalla, Mark N. Mallery, McCalla, Thompson, Pyburn, Hymowitz & Shapiro, and Anthony M. Dileo, Wayne J. Lee, Steven W. Usdin, Michael D. Landry, Stone, Pigman, Walther, Wittmann & Hutchinson, L.L.P., New Orleans, for appellants.

Herbert B. Bowers, III, Dale C. Wilks, Bowers & Bowers, New Orleans, for appellee.

Dorinda C. Bordlee, Metairie, for amici curiae.

Before BYRNES, CIACCIO and LANDRIEU, JJ.

CIACCIO, Judge.

This is an appeal of a jury verdict rendered in favor of plaintiff, Charles A. Hemmans and against State Farm Mutual Insurance Company and certain individual defendants. The trial court rendered judgment adopting the jury verdict, and defendants' motion for judgment notwithstanding the verdict or new trial was denied. Defendants now appeal from this judgment on the basis of several assignments of error. For the reasons stated more fully herein, we vacate the jury verdict and render judgment in favor *71 of defendants, dismissing plaintiffs suit against them.

FACTS AND PROCEDURAL HISTORY

Charles Hemmans is a State Farm Mutual Insurance Company agent in New Orleans. He has been an agent pursuant to a "State Farm Agent's Agreement" since November 1, 1985, having for two years prior to this date been classified as a trainee. Under the terms of this agreement, the agent is limited to soliciting and writing policies solely and exclusively for State Farm. The contract styles Hemmans' status as an independent contractor with control of his own daily activities and the manner in which he solicits business. Based on his agreement with State Farm, Charles Hemmans leased an office at 4640 Carrollton Avenue in New Orleans from which he conducts his insurance business.

In September of 1990, Robert G. West, the Regional Vice-President of State Farm for the Mid-South Region, of which Hemmans was a member, adopted additional underwriting rules in response to severe automobile underwriting losses experienced by State Farm. Included in these rules was an "added cars only program" or "loss control program" which provides that State Farm would not accept new customer automobile policies from agents who were identified as high loss agents. To enact this program, the company adopted four criteria for determining which agents would be considered high loss agents and placed on the program. Included in the criteria was the amount of losses incurred by the agent's policyholders and the frequency of their accidents. When the program was adopted in 1990, seventy out of the 800 agents in the mid-south region met the criteria and were placed on the program for some length of time.

Charles Hemmans was one of the agents who met these criteria. He was placed on the program effective October 15, 1990 by letter dated November 9, 1990 from Michael Cohen, Agency Director of State Farm. Under the terms of this program, Hemmans was restricted to writing automobile insurance for cars of existing policyholders only, in addition to writing new policies for life, health and fire insurance. According to this program, Hemmans could not bind automobile insurance for individuals who did not currently hold some type of State Farm insurance. Hemmans complied with the restrictions and was removed from the program one year later, in October of 1991.

On April 30, 1991, Hemmans filed a Petition for Declaratory Judgment and Damages against State Farm Insurance Company and certain State Farm officers, Robert West, Carl Mixon, G. Michael Cohen and Guy Barr, seeking a declaration that the "added car only program" was in violation of the State Farm Agent's Agreement and the rights of plaintiff as an independent contractor under the agreement. Hemmans, who is African-American, also contended that implementation of the program was racially discriminatory in that business which Hemmans was unable to write was sent to white State Farm agents who were not on the program. In his petition, Hemmans alleged that State Farm was liable for breach of contract, bad faith conduct, and certain negligent and intentional torts, including negligent misrepresentation, defamation and intentional interference with a contract. Hemmans sought damages for loss of business opportunity, loss of income, damage to his reputation and for professional embarrassment.

On the same date the petition was filed, April 30, 1991, Hemmans filed an ex parte motion to transfer and consolidate his lawsuit with the action entitled Ben Guillory v. State Farm Insurance Company, et al., alleging that the Guillory suit which was previously pending involved identical issues as those presented in the suit filed by Hemmans. The trial court granted this motion on April 30, 1991 and transferred and consolidated the two lawsuits into one section of court.

State Farm subsequently answered Hemmans' petition, denying Hemmans' claims and further asserting several defenses. State Farm also filed an opposition to the order of consolidation of the Hemmans suit with the Ben Guillory suit and requested a contradictory hearing on this issue. The order of consolidation was subsequently recalled pending this hearing. Following the hearing, the two lawsuits were again consolidated and the matter proceeded to trial. *72 The Hemmans and Guillory suits were tried before a jury from August 23, 1993 through September 30, 1993.

Although the suits were consolidated for trial, different sets of interrogatories were given to the jury at the conclusion of trial for each plaintiff. In the Charles Hemmans case, the jury interrogatories and responses provided as follows:

INTERROGATORY NO. 1 1(a) Did Charles Hemmans prove by a preponderance of the evidence that State Farm Insurance Company by placing him on a loss control program intentionally discriminated against him because of his race? YES _______________ NO X INTERROGATORY NO. 2 2. Did Charles Hemmans prove by a preponderance of the evidence that his relationship with State Farm Insurance Company was that of an employee? YES X NO _______________ INTERROGATORY NO. 3 3(a). Did Charles Hemmans prove by a preponderance of the evidence that State Farm Insurance Company breached his agency contract by placing him on a loss control program? YES X NO _______________ 3(b). Did Charles Hemmans prove by a preponderance of the evidence that the breach of his agency contract by State Farm Insurance Company was in bad faith? YES _______________ NO X 3(c). Did Charles Hemmans prove by a preponderance of the evidence that Robert West or Guy Barr as corporate officers of State Farm Insurance Company intentionally interfered with his agency contract with State Farm Insurance Company? 1) Robert West YES X NO _______________ 2) Guy Barr YES X NO _______________ 3(d).

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Bluebook (online)
653 So. 2d 69, 10 I.E.R. Cas. (BNA) 664, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hemmans-v-state-farm-ins-co-lactapp-1995.