Perez v. Continental Cas. Co.

367 So. 2d 1284
CourtLouisiana Court of Appeal
DecidedMarch 23, 1979
Docket6846
StatusPublished
Cited by15 cases

This text of 367 So. 2d 1284 (Perez v. Continental Cas. 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
Perez v. Continental Cas. Co., 367 So. 2d 1284 (La. Ct. App. 1979).

Opinion

367 So.2d 1284 (1979)

Robert PEREZ, Jr., Plaintiff-Appellant,
v.
CONTINENTAL CASUALTY COMPANY et al., Defendants-Appellees.

No. 6846.

Court of Appeal of Louisiana, Third Circuit.

February 5, 1979.
Writ Refused March 23, 1979.

*1285 Domengeaux & Wright, William P. Rutledge, Lafayette, for plaintiff-appellant.

Voorhies & Labbe, Richard D. Chappuis, Lafayette, for defendants-appellees.

Davidson, Meaux, Sonnier & Roy, L. Lane Roy, Lafayette, amicus curiae.

Before WATSON, CUTRER and DOUCET, JJ.

CUTRER, Judge.

This is a suit for damages by Robert Perez, Jr., as a result of injuries received while performing his duties as an employee of Morton Chemical Company. The defendants are certain executive officers and/or employees of Morton and their insurer, Continental Casualty Company. The defendants filed an exception of no right or cause of action on the ground that LSA-R.S. 23:1032, as amended by Act 147 of 1976, granted immunity to defendants as executive officers or co-employees from being sued in tort by a fellow employee.

The trial court sustained the exception filed by defendants, dismissing plaintiff's suit. Plaintiff appeals.

The single issue presented on appeal is whether LSA-R.S. 23:1032, as amended by Act 147 of 1976,[1] is constitutional.

Before we get into a discussion of the issue, we feel that a brief background discussion of the statute would be helpful. The initial Workmen's Compensation Act came into being by the adoption of Act 20 of 1914. The fundamental characteristics of the Act have remained intact to this date. The changes that have been made have usually affected the amount of compensation allowed, changes of disability provisions, *1286 or other amendments which were necessitated by experience.[2]

The purpose of the Act is set out in the case of Atchison v. May, 201 La. 1003, 10 So.2d 785 (1942), where our Supreme Court stated as follows:

". . . The act, which is social legislation, was passed for the joint benefit of labor and management in order to insure that employees who became disabled as a result of their labors in hazardous industries would have, during the period of their disability, a weekly income for the upkeep of themselves and their families. * * * In order that this end might be accomplished, the Legislature provided for sacrifices to be made by both the employer and the employee. The employee was required to waive the right granted him under the general law, Article 2315 of the Civil Code, in consideration of receiving a fixed percentage of his wages during the period of disability. The employer, on the other hand, was deprived of the defenses afforded to him by the general law and he was assured that, in case any of his employees were injured, they would be entitled to no more than the amount stipulated in the statute as compensation during the period of disability. * * *"

One of the fundamental features of the Act is that the employee's cause of action against the employer is exclusively for workmen's compensation (LSA-R.S. 23:1032). Even though the cause of action for compensation is exclusive between the employee and employer, the Act, however, authorizes the employee to proceed against third parties for damages even though he has been awarded compensation by his employer for the same injury (LSA-R.S. 23:1101).

The term "third parties" as used in this section was interpreted to include officers, directors, principals, and employees of the employer. Until 1959 the cases involving the tort liability of a fellow employee were concerned with claims against workers on approximately the same level of employment as the victim. The problem of the liability of persons in the upper echelons of management was raised in 1958 in the case of Adams v. Fidelity and Casualty Company of N. Y., 107 So.2d 496 (La.App. 1st Cir. 1958). Malone, Louisiana Workmen's Compensation Law and Practice, § 366, p. 193, 1964 Supp. Following Adams, the line of cases developed commonly referred to as "executive officer" suits. Canter v. Koehring Co., 283 So.2d 716 (1973).

With the advent and progression of the "executive officer" suits, the employer was faced with serious problems of practical importance. As pointed out by Malone, Louisiana Workmen's Compensation Law and Practice, § 366, p. 194 of 1964 Supp.:

". . . If officers in the upper echelons of management find themselves exposed to the often disastrous prospect of tort liability for the almost unlimited number of employee accidents that could be in some way attributed to their neglect, they will be impelled in practice to exact liability insurance from the corporate employer. The result may be a denial to the employer of much of the practical advantage of the exclusive remedy provision. This, however, is a matter for legislative consideration."

Thus, the legislature adopted Act 147 of 1976 (amending LSA-R.S. 23:1032) which extended tort immunity not only to employers but also to any principal, officer, director, stockholder, partner or employee of such employer.

We now approach the question of constitutionality of the amendment.

Shortly after the adoption of the Louisiana Workmen's Compensation Act in 1914, it was challenged as being unconstitutional on the ground that it was a denial of due process of law and was also a deprivation of the equal protection of the laws. Boyer v. Crescent Paper Box Factory, 143 La. 368, 78 So. 596 (1917). The court held the act constitutional, citing the U.S. Supreme Court *1287 case of New York Central R. R. Co. v. White, 243 U.S. 188, 37 S.Ct. 247, 61 L.Ed. 667 (1917). The court in the latter case found a New York workmen's compensation act constitutional on the ground that such legislation was within the police power of the State.

Subsequent Louisiana cases likewise reflect that the statute has withstood attacks of constitutionality. Day v. Louisiana Central Lumber Co., 144 La. 120, 81 So. 328 (1919); Colorado v. Johnson Iron Works, 146 La. 68, 83 So. 381 (1919); and Williams v. Blodgett Construction Co., 146 La. 841, 84 So. 115 (1920). In these cases the plaintiffs generally attacked the validity of the Act on the ground that the Act unconstitutionally deprived the plaintiffs of the right to proceed in tort against the employer.

Our Supreme Court in a more recent case, Ancor v. Belden Concrete Products, Inc., 260 La. 372, 256 So.2d 122 (1971), in discussing the validity of the Louisiana Workmen's Compensation Law, held as follows:

"The Louisiana Workmen's Compensation Act was adopted in 1914. [footnote omitted] It rests upon the sound economic principle that the cost of injuries and deaths incurred in the manufacture or distribution of a product should be diffused in the channels of commerce as part of the price to the consumer.

* * * * * *

"It provides a framework for compensation for disability or death from work-connected injuries without regard to fault. The benefits in the Act do not include the full range of elements in tort damages. The failure of the workmen's compensation statute to afford recovery for all losses recoverable in tort does not impair its validity. See New York Central Ry. Co. v. White, 243 U.S. 188, 37 S.Ct. 247, 61 L.Ed. 667, L.R.A.1917D, 1 (1917); Bergeron v.

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367 So. 2d 1284, Counsel Stack Legal Research, https://law.counselstack.com/opinion/perez-v-continental-cas-co-lactapp-1979.