156 So. 3d 99
La. Ct. App.2013Background
- Mandina’s sues Powell Insurance and John O’Brien for negligence related to Katrina-related BI/EE coverage.
- Policy history: NFIP flood policy excluded BI/EE; BI/EE added to fire/windstorm policy years before Katrina; flood exclusion remained.
- Five days before Katrina, O’Brien recommended increasing BI/EE from $400k to $500k; Mandina’s accepted; policies not delivered before the hurricane.
- Mandina’s learned after the loss that flood BI/EE was not covered and alleged the agents misrepresented coverage and duties.
- Trial court granted summary judgment for defendants, then granted Mandina’s new-trial motion, vacating judgment and denying defendants’ summary judgment; interlocutory judgments certified as final for appeal.
- Appellate court converts the appeal to a supervisory writ and ultimately reverses, granting defendants’ summary judgment; holds no liability for failure to advise beyond reasonable diligence.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Duty to advise on flood BI/EE coverage | Mandina’s contends agents owed broader duty to recommend scope of BI/EE, including flood. | Newman limits duty; no spontaneous duty to advise on flood coverage beyond reasonable diligence. | No duty to advise beyond reasonable diligence; summary judgment for defendants proper. |
| Justifiable reliance and material facts | Mandina’s relied on Powell’s representations that coverage included flood BI/EE. | Reliance not justifiable; insured bears reading policy contents; no factual dispute about policy terms. | No genuine issue of material fact; Mandina’s reliance insufficient to preclude summary judgment. |
| Appellate jurisdiction and relief device | N/A | N/A | Court has jurisdiction to review via supervisory writ; conversion of appeal warranted; writ granted and judgment reversed. |
Key Cases Cited
- Isidore Newman School v. J. Everett Eaves, Inc., 42 So.3d 352 (La. 2010) (agent duty limited to reasonable diligence; insured must request and read policy)
- City Blueprint & Supply Co., Inc. v. Boggio, 3 So.3d 62 (La. 4 Cir. 2008) (no duty to notify of flood options absent specific inquiry; insured presumed to know terms)
- Seruntine v. State Farm Fire and Cas. Co., 38 So.3d 438 (La.App. 4 Cir. 2010) (genuine issues preemption; reliance analysis in insured claims)
- Karam v. St. Paul Fire & Marine Insurance Co., 281 So.2d 728 (La.1973) (agent owes reasonable diligence to procure requested insurance)