219 So. 3d 442
La. Ct. App.2017Background
- Liberty Mutual intervened in a tort suit by Mary Ortega asserting a workers’ compensation lien and later filed this separate suit alleging defendants settled Ortega’s claim without Liberty Mutual’s written approval in violation of La. R.S. 23:1102(C)(1).
- Ortega settled with Allmerica, Terry Weaver, Progressive, and Phillips on September 17, 2015; Liberty Mutual’s intervention in the underlying tort action was dismissed on October 27, 2015.
- Liberty Mutual sued (Mar. 28, 2016) seeking reimbursement of compensation and medical benefits allegedly owed because the third‑party defendants failed to obtain its written approval for the compromise.
- Defendants filed peremptory exceptions of res judicata; the trial court granted those exceptions and denied sanctions; Liberty Mutual appealed.
- The appellate court held that an earlier appellate decision rejecting Liberty Mutual’s contention that the tort defendant qualified as a “third person” under the workers’ compensation statutes precluded relitigation of that issue, and also concluded Liberty Mutual failed to plead facts showing the tortfeasor met the statutory “third person” criteria.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether res judicata (issue preclusion) bars Liberty Mutual’s suit | Liberty Mutual: settlement without its approval created a new cause of action under La. R.S. 23:1102(C)(1) entitling it to reimbursement | Defendants: prior judgment resolved the dispositive issue (whether the tortfeasor was a qualifying “third person”); issue preclusion applies | Court: Res judicata/issue preclusion applies; prior appellate decision decided the same issue against Liberty Mutual |
| Whether the tortfeasor qualified as a “third person” under La. R.S. 23:1101(C) | Liberty Mutual: settlement triggered §1102(C)(1) liability because it had intervened and the defendants did not obtain written approval | Defendants: the prior ruling found Ortega was not in course and scope and Liberty Mutual did not incur compensable additional expenses; thus §1101(C) does not apply | Court: The earlier decision rejected Liberty Mutual’s third‑person contention; Liberty Mutual cannot relitigate it |
| Whether Liberty Mutual stated a cause of action in the petition | Liberty Mutual: alleged settlement without approval and sought reimbursement of benefits paid | Defendants: the petition fails to allege facts showing the tortfeasor falls within statutory definition required for §1102 relief | Court: Court raised and sustained a sua sponte exception of no cause of action; petition dismissed with prejudice |
| Whether appealable judgments and parties were identical for preclusion | Liberty Mutual: its claim arose after prior final judgment (post‑judgment settlement) so it could not have been raised earlier | Defendants: prior final judgment between same parties decided essential issue; timing does not avoid issue preclusion | Court: Timing irrelevant for issue preclusion when issue was actually litigated and essential; res judicata applies |
Key Cases Cited
- Terrebonne Fuel & Lube, Inc. v. Placid Ref. Co., 666 So.2d 624 (La. 1996) (explains purpose and scope of res judicata and adoption of issue preclusion)
- Haynes v. United Parcel Serv., 933 So.2d 765 (La. 2006) (interpreting application of workers’ compensation third‑person statutes)
- Travelers Ins. Co. v. Joseph, 656 So.2d 1000 (La. 1995) (analysis of third‑person liability under workers’ compensation law)
- Hudson v. City of Bossier, 766 So.2d 738 (La. App. 2 Cir. 2000) (distinguishes claim preclusion and issue preclusion)
- Goodman v. Spillers, 686 So.2d 160 (La. App. 2 Cir. 1996) (issue preclusion requires the issue be dispositive and actually litigated)
- Moreno v. Entergy Corp., 64 So.3d 761 (La. 2011) (courts may raise certain peremptory exceptions sua sponte)