148 So. 3d 205
La. Ct. App.2014Background
- On Aug. 19, 2009 Vickie Lemoine and her son were injured in an accident caused by another motorist; liability carrier paid $495,000 (Vickie $440,000; Kenneth $45,000 loss of consortium; Payton $10,000). Plaintiffs also had Allstate UM/UIM coverage ($100,000 per person/$800,000 per accident).
- Vickie sustained cervical disc herniations, underwent two surgeries (2010 and 2011), reached MMI Jan. 8, 2013 with permanent work restrictions, and had vertigo that resolved in 2012. Medical expenses through trial stipulated at $139,938.08.
- Vickie owned and operated one‑boat tug company (H.P. Marine, LLC); testified she earned $5,625/month in 2009 and sold the boat in April 2010 because her injuries prevented performance; company tax returns showed reported losses (depreciation/repairs asserted as explanation).
- At trial plaintiffs sought UM recovery (including past lost earnings) and statutory penalties/attorney’s fees for alleged bad faith failure to tender; parties stipulated all claims against Allstate other than bad faith did not exceed $50,000 and any bad faith recovery would not exceed $50,000.
- Trial court awarded Vickie $662,682.08 (later reduced by stipulation to $50,000 recoverable from Allstate) — including $225,000 for past lost earnings (40 months × $5,625), $137,682.08 medicals, and $300,000 general damages — and Kenneth $50,000 for loss of consortium; denied bad faith penalties and fees.
- Both parties appealed: Allstate challenged lost‑earnings and consortium awards as erroneous/excessive; Lemoines appealed denial of bad faith penalties/fees. Appellate court affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Recovery for past lost earnings | Vickie: testified she earned $5,625/month pre‑accident; could not perform tugboat duties after accident; vocational and FCE reports support inability to return | Allstate: company tax returns show losses; plaintiff is self‑employed owner (LLC), sale of boat produced profit; disputed ability to return to work and claim not sufficiently documented | Award upheld: plaintiff testimony corroborated by personal tax return and medical/vocational reports; LLC is separate entity so company losses/profits do not defeat personal lost‑earnings claim; no manifest error |
| Mitigation defense to lost earnings | Vickie: hiring help was not feasible (home‑based operation, added costs) | Allstate: plaintiff failed to mitigate by not hiring part‑time help to perform loading tasks | Court affirmed refusal to reduce award; Allstate failed to prove mitigation defense |
| Loss of consortium (Kenneth) | Kenneth: testified to loss of companionship, reduced family activities, care burdens, diminished intimacy | Allstate: award excessive | $50,000 award affirmed; trial court did not clearly abuse discretion |
| Bad faith penalties and attorney fees under La. R.S. 22:1892 & 22:1973 | Lemoines: demand letters, tax returns, and discovery provided satisfactory proof of loss including lost earnings; Allstate unreasonably refused to tender | Allstate: plaintiffs did not provide satisfactory proof of extent of lost earnings; coverage exposure unclear given underlying liability recovery; reasonable dispute existed (vocational opinions conflicted) | Denial of penalties/fees affirmed: insurer had reasonable, legitimate doubts about extent/causation of lost earnings based on information available before tender; no manifest error in finding no arbitrary/capricious refusal |
Key Cases Cited
- Boyette v. United Services Automobile Assoc., 783 So.2d 1276 (La. 2001) (plaintiff must prove wage loss by showing she would have earned wages but for the accident)
- Driscoll v. Stucker, 893 So.2d 32 (La. 2005) (plaintiff's own testimony may suffice to establish lost earnings)
- McDill v. Utica Mut. Ins. Co., 475 So.2d 1085 (La. 1985) (definition and elements of satisfactory proof of loss)
- Reed v. State Farm Mut. Auto. Ins. Co., 857 So.2d 1012 (La. 2003) (statutory bad‑faith/penalty claims require insurer received satisfactory proof of loss and acted arbitrary or capriciously)
- Louisiana Bag Co., Inc. v. Audubon Indem. Co., 999 So.2d 1104 (La. 2008) (insurer’s conduct judged on facts known at time; satisfactory proof must fully apprise insurer of claim)
- Carter v. Baham, 683 So.2d 299 (La. App. 4th Cir. 1996) (loss of earnings claims resting on professional/business records require detailed documentation and expert analysis)