230 So. 3d 687
La. Ct. App.2017Background
- On July 19, 2013 Brandon Forvendel was injured while driving his own vehicle insured by State Farm; he had UM coverage and recovered his policy limits from State Farm.
- Forvendel lived with his mother, Deborah, who had a separate State Farm UM policy with higher limits; State Farm denied recovery under her policy for the 2013 accident.
- In 2007, under nearly identical circumstances, State Farm paid Forvendel under both his own and his mother’s UM policies and sent a letter confirming he “does qualify as an insured for Uninsured Motorist coverage.”
- State Farm employees later testified that the 2007 dual payment was incorrect under Louisiana’s anti-stacking statute, and that no notice was given to the Forvendels that the 2007 payment was an error.
- Forvendel sued; at bench trial the court found State Farm waived its right to deny coverage under Deborah’s policy (including the anti‑stacking defense) based on its 2007 conduct and entered judgment for $50,000.
- The Fifth Circuit affirmed, concluding the trial court’s factual findings were not manifestly erroneous and that State Farm’s conduct satisfied the elements of waiver.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether State Farm’s prior 2007 payment/representations waived its right to deny coverage under Deborah’s UM policy for the 2013 accident | Forvendel: State Farm’s 2007 written confirmation and conduct amounted to waiver of the insurer’s right to deny coverage | State Farm: Past conduct is irrelevant; it cannot be used to expand coverage or create stacking rights | Held: Waiver — State Farm’s 2007 conduct and letter constituted waiver of its coverage defenses; Forvendel was an insured under his mother’s policy |
| Whether Forvendel was an insured under Deborah’s policy despite not being listed or the vehicle not described in that policy | Forvendel: State Farm’s course of conduct and representations made him an insured under Deborah’s policy | State Farm: He was not an insured; policy terms and statute exclude coverage | Held: Forvendel was an insured because State Farm knowingly relinquished the right to deny coverage |
| Whether Louisiana’s anti‑stacking statute barred recovery under both policies for the 2013 accident | Forvendel: Waiver of insurer’s anti‑stacking defense (based on State Farm’s prior conduct) allows stacking here | State Farm: Anti‑stacking statute and policy language prohibit stacking; waiver cannot overcome statute | Held: Waiver applies — insurer’s conduct waived the anti‑stacking defense and allowed stacking in this case |
| Whether Forvendel could recover penalties under La. R.S. 22:1973 for insurer bad faith | Forvendel: Sought statutory penalties after appeal | State Farm: No liability; issue not pled/tried | Held: Denied — Forvendel never pled a 22:1973 claim and had stipulated damages ≤ $50,000; statutory penalties unavailable |
Key Cases Cited
- Lasyone v. Kan. City S. R.R., 786 So.2d 682 (La. 2001) (appellate standard: fact findings reversed only for manifest error)
- Stobart v. State of Louisiana, Through Dep’t of Transp. & Dev., 617 So.2d 880 (La. 1993) (reviewing court must determine whether factfinder’s conclusion is reasonable)
- Housley v. Cerise, 579 So.2d 973 (La. 1991) (standard cited on weighing evidence and manifest error)
- Hoefly v. Government Employees Ins. Co., 418 So.2d 575 (La. 1982) (UM statutes construed liberally to promote recovery)
- Boult v. State Farm Mut. Auto. Ins. Co., 752 So.2d 739 (La. 1999) (defines stacking and when stacking issues arise)
- Steptore v. Masco Constr. Co., 643 So.2d 1213 (La. 1994) (insurer may waive coverage defenses by conduct; duty to investigate when facts suggest possible defense)
- Monju v. Continental Cas. Co., 487 So.2d 729 (La. App. 5th Cir. 1986) (discusses equitable estoppel and limits on expanding coverage; considered inapplicable by majority)
- Livas v. State Farm Mut. Auto. Ins. Co., 797 So.2d 694 (La. App. 1st Cir. 2000) (insurer may provide coverage beyond statutory minimums through policy language)
- Nall v. State Farm Mut. Auto. Ins. Co., 406 So.2d 216 (La. 1981) (recognizes insurer’s right under anti‑stacking statute)