Case Name: Henry and Clara COLLINS v. CAPITAL VALVE AND FITTING COMPANY, et al.
Court: Louisiana Supreme Court
Jurisdiction: Louisiana
Decision Date: 1982-01-25
Citations: 409 So. 2d 579
Docket Number: No. 81-C-1976
Parties: Henry and Clara COLLINS v. CAPITAL VALVE AND FITTING COMPANY, et al.
Judges: LEMMON, J., dissents.
Reporter: Southern Reporter, Second Series
Volume: 409
Pages: 579–581

Head Matter:
Henry and Clara COLLINS v. CAPITAL VALVE AND FITTING COMPANY, et al.
No. 81-C-1976.
Supreme Court of Louisiana.
Jan. 25, 1982.
Rehearing Denied Feb. 19, 1982.
Joseph A. Gladney, of Joseph A. Gladney & Associates, Baton Rouge, for plaintiff-applicant.
James B. Doyle, of Doyle & Simmons, Baton Rouge, for defendant-respondent.

Opinion:
BLANCHE, Justice.
This is a tort suit to recover damages resulting from an automobile accident and the sole issue presented concerns the interruption of prescription.
Clara Collins was injured in an automobile accident on October 3,1979. In December 1979, the defendant's insurer issued a draft in the names of both Henry and Clara Collins in payment of the property damage to the automobile. On October 23, 1980 the plaintiffs filed suit for medical expenses, lost wages and personal injuries, and this suit was met with a plea of prescription. The trial court sustained the plea but then overruled it on rehearing, citing Flowers v. U. S. F. & G., 381 So.2d 378 (La.1980) and Richardson v. Louisiana Farm Bureau Mutual Ins. Co., et al., 393 So.2d 200 (1st Cir.1981). The court of appeal found that the trial court erred in interpreting Flowers and Richardson too broadly, and held that payment to Mr. and Mrs. Collins only acknowledged the community's claim for property damage and did not affect prescription on other elements of damage. We affirm the holding of the court of appeal.
In Flowers, Mrs. Flowers was injured when defendant's insured struck the family vehicle. We held that tacit acknowledgment of the community claim for medical expenses by partial payment to Mr. Flowers did not interrupt prescription on Mrs. Flowers' separate action for her personal injuries. Therefore, when Mrs. Flowers filed suit to recover damages for her personal injuries more than' one year after the accident, defendant's plea of prescription was sustained.
It is not necessary to address the arguments made by plaintiffs concerning the effect of Flowers because we find that is not controlling in this case. Flowers dealt with the effect of acknowledgment of the prescriptive period and, here, it is apparent that there was not an acknowledgment but, rather, a settlement which acted as a transaction and compromise of the property damages.
A transaction or compromise is an agreement between two or more persons who, for preventing or putting an end to a lawsuit, adjust their differences by mutual consent, in the manner upon which they agree and which every one of them prefers to the hope of gaining, balanced by the danger of losing. See C.C. art. 3071. Mr. and Mrs. Collins originally sought $1,600 and retention of the salvage of their automobile; however, they ultimately accepted $1,356.34 and retention of the salvage. Therefore, the Collins' gave up the right to claim a higher sum for property damage and the insurance company gave up the right to dispute liability.
The scope of a transaction is delineated in C.C. art. 3073 which states:
"Transactions regulate only the differences which appear clearly to be comprehended in them by the intention of the parties, whether it be explained in a general or particular manner, unless it be the necessary consequence of what is expressed; and they do not extend to differences which the parties never intended to include in them."
In this case the intent of both parties concerning the scope of the transaction is readily apparent because both the check issued by the insurer and the release executed by the Collins clearly indicated that the payment was intended to be in settlement of the property damage. Further, it is obvious that counsel for the plaintiffs realized that prescription was running on other elements of damage as shown in a letter to the insurance adjuster dated August 8, 1980. In that letter, plaintiffs' counsel advised that he was enclosing a copy of a petition which he intended to file in this case. He also made reference to the fact that the claim prescribed in October and stated that for that reason, he had filed suit in the plaintiffs' behalf. No suit was filed but the important fact revealed by the letter was knowledge by plaintiffs' counsel that the claim for other elements of damage would prescribe if suit was not filed by the October prescriptive date.
We find that the court of appeal reached the correct result, but was in error in basing its opinion on Flowers. Accordingly, we affirm the holding that payment of the property damage did not affect the pre scriptive period on the other elements of damage for the reasons set forth above.
LEMMON, J., dissents.