Opinion ID: 1803523
Heading Depth: 1
Heading Rank: 6

Heading: Choice-of-law Provisions

Text: Unless otherwise expressly provided by the law of this state, cases having contacts with other states are governed by the law selected in accordance with the provisions of Book IV of the Civil Code. La. C.C. art. 14. The residual nature of the provisions of Book IV is established by the introductory phrase of La. C.C. art. 14 that reads unless otherwise expressly provided by the law of this state. La. C.C. art. 14 Revision Comment (b). This phrase means that the provisions of Book IV are not intended to supercede more specific choice-of-law rules contained in other Louisiana statutes, such as the Insurance Code ( See, La. R.S. 22:611 et seq. ). Id. When applicable, those rules, being more specific, will prevail over the provisions of Book IV of the Civil Code. See, Symeon C. Symeonides, Louisiana Conflicts Law: Two Surprises, 54 La. L.Rev. 497, 503. [6] La. C.C. arts. 3515 et seq. contain the new choice-of-law rules. La. C.C. art. 3515 provides: Except as otherwise provided in this Book, an issue in a case having contacts with other states is governed by the law of the state whose policies would be most seriously impaired if its law were not applied to that issue. That state is determined by evaluating the strength and pertinence of the relevant policies of all involved states in the light of: (1) the relationship of each state to the parties and the dispute; and (2) the policies and needs of the interstate and international systems, including the policies of upholding the justified expectations of parties and of minimizing the adverse consequences that might follow from subjecting a party to the law of more than one state. La. C.C. art. 3537 provides as follows: Except as otherwise provided in this Title, an issue of conventional obligations is governed by the law of the state whose policies would be most seriously impaired if its laws were not applied to that issue. That state is determined by evaluating the strength and pertinence of the relevant policies of the involved states in the light of: (1) the pertinent contacts of each state to the parties and the transaction, including the place of negotiation and, formation, and performance of the contract, the location of the object of the contract, and the place of domicile, habitual residence, or business of the parties; (2) the nature, type, and purpose of the contract; and (3) the policies referred to in Article 3515, as well as the policies of facilitating the orderly planning of transactions, of promoting multistate commercial intercourse, and of protecting one party from undue imposition by the other. Recent Jurisprudence Regarding La. R.S. 22:1406 In a series of holdings, the fourth and fifth circuit courts of appeal held that La. R.S. 22:1406(D)(1)(a)(iii) is a specific rule that prevails over the provisions of Book IV of the Civil Code and should, therefore, be automatically applied to the interpretation of foreign UM policies without engaging in a choice-of-law analysis. First, the fourth circuit court of appeal decided Dekeyser v. Automotive Casualty Insurance Company, 97-1251 (La.App. 4th Cir.2/4/98), 706 So.2d 676, which involved a three-car accident that occurred in New Orleans, Louisiana. Residents of Louisiana, Arizona, and California were involved in the collision. The plaintiff, an Arizona resident, was a guest passenger in a vehicle driven and owned by another Arizona resident. The plaintiff filed suit in Louisiana for personal injuries. State Farm Mutual Insurance Company (hereinafter State Farm), the driver's UM provider, was among the named defendants. Following a jury trial, the trial court rendered judgment in favor of the plaintiff. On appeal, State Farm argued that Arizona law should apply, while the plaintiff asserted that Louisiana law governed the case. The court of appeal held the following: LSA-R.S. 22:1406(D)(1)(a)(iii) provides a specific rule governing the question of underinsured motorists insurance coverage in [the plaintiff's] case. Therefore, the specific rule controls the conflict of laws issue, irrespective of whether the Court considers the general rules of Book IV or the general rules controlling conflict of laws issues existing in Louisiana before the legislature's codification of the rules with Book IV. Next, the fourth circuit addressed the issue in Austin v. Western World Ins. Co., supra, 99-2541 (La.App. 4th Cir.5/17/00), 765 So.2d 390, writ denied, XXXX-XXXX (La.9/22/00), 768 So.2d 1288. In Austin , a taxicab and a flatbed truck collided on a highway in New Orleans, Louisiana. Plaintiffs were New York residents who were traveling in the taxicab. Both the taxicab driver and the driver of the flatbed truck were Louisiana residents. Plaintiffs filed suit in Louisiana against eight defendants including GEICO, plaintiff Richard Austin's UM provider and P.G. Insurance Company, which provided additional UM coverage to Austin through his parent's insurance policy. In response to the suit, GEICO filed a motion for summary judgment arguing that New York's UM law provided an offset that should be applied to its UM liability. In opposition, the plaintiffs asserted that since the accident occurred in Louisiana and involved a Louisiana resident then Louisiana law should apply to the interpretation of the GEICO policy. After the trial court denied GEICO's motion, the plaintiffs moved for summary judgment against the New York insurers, arguing that La. R.S. 22:1406(D)(1)(a)(iii) should apply to their respective UM policies. On appeal, the fourth circuit, relying upon its prior decision in Dekeyser, supra, declined to apply New York's offset provisions. Instead, the court concluded that it was the Legislature's intent that the specific rule, i.e., LSA-R.S. 22:1406(D)(1)(a)(iii), control the conflict of laws issue, rather than the general rules of Book IV concerning conflict of laws. Id. at 393. Lastly, the fourth circuit court of appeal addressed La. R.S. 22:1406(D)(1)(a)(iii) in Crutchfield v. Landry, XXXX-XXXX (La.App. 4th Cir.1/31/01), 778 So.2d 1249. The Crutchfield case arose from a fatal accident that occurred in Louisiana when defendant, Derek Landry, struck plaintiff, Samuel Crutchfield, while Crutchfield was standing on the shoulder of a highway. Landry was a Louisiana resident at the time of the accident, and Crutchfield was a California resident working for Trism, Inc., an interstate trucking company. Trism, Inc. was incorporated in Delaware but had its principal place of business in Georgia. Trism, Inc. had in effect an insurance policy with Lexington Insurance that was purchased and negotiated in Georgia. Crutchfield's survivors, all of whom were California residents, filed suit in Louisiana against several defendants including Lexington Insurance. Following a hearing, the trial court granted plaintiffs' partial summary judgment and ruled that Lexington's policy provided UM coverage for the accident. Id. at 1250. On appeal, Lexington asserted that its insurance policy contained a clear and valid UM exclusion that was applicable. However, the exclusion was valid under the law of Georgia but not Louisiana. The court, relying upon its prior holdings in Dekeyser, supra, and Austin, supra, held the following: Louisiana's interest in regulating awards to victims in this state's highways, in protecting persons traveling on its highways from damage caused by uninsured/underinsured motorist, and in equally assessing the burden of awards to all culpable parties outweighs those of Georgia. Furthermore, a contrary holding would undercut and weaken Louisiana's long standing policy of requiring uninsured/underinsured motorist coverage to protect victims who travel on this state's highways and are injured by Louisiana residents. Further, our Circuit in Dekeyser and Austin , has clearly interpreted LSA-C.C. art. 14, dealing with multistate cases, to mean that the general choice-of-law rules (i.e. La. C.C. arts. 3515 and 3537) are superceded by more specific choice-of-law provisions (i.e. La. R.S. 22:1406(D)(1)(a)(iii)). Id. at 1252. The fifth circuit court of appeal interpreted La. R.S. 22:1406(D)(1)(a)(iii) in the same fashion when it decided Drew v. Martello, 98-1141, 98-1142 (La.App. 5th Cir.2/23/99), 729 So.2d 90 and held that the Louisiana UM law specifically provides that it is applicable to `any accident which occurs in this state and involves residents of this state.' Id. at 93. In the present case, Mississippi Farm Bureau disagrees with the conclusions of the fourth and fifth circuit courts of appeal and urges this court to adopt the adverse position articulated by the first circuit court of appeal in Zuviceh v. Nationwide Insurance Company, XXXX-XXXX (La.App. 1st Cir.5/11/01), 786 So.2d 340, writ denied, 2001-2141 (La.11/09/01), 801 So.2d 373. That case concerned a head-on collision that occurred in Slidell, Louisiana and involved Barbara Songy Zuviceh, a Mississippi resident, and Steven Wicks, a Louisiana resident. When the accident happened, Zuviceh had in force a UM insurance policy that was issued to her and her husband by Nationwide Insurance Company (hereinafter Nationwide). The UM policy was negotiated and issued in Mississippi and covered Zuviceh's vehicle which was registered in Mississippi. Zuviceh petitioned the court for a judgment declaring which state's law governed the interpretation of the UM policy, Mississippi or Louisiana. The trial court conducted a choice-of-law analysis and ruled that Mississippi law should apply. Id. at 342. In making its ruling, the trial court determined that Mississippi law applied to interpret the terms of the Nationwide policy because Mississippi has a more substantial interest in the uniform application of its laws than Louisiana has in providing an insurance remedy to an out-of-state resident who sustains an injury while temporarily within the state's borders. Id. at 342. On appeal, the first circuit court of appeal carried out a comprehensive examination of this court's and the lower court's analysis of Louisiana's UM law and its application to foreign insurance policies in multistate cases occurring in Louisiana and involving a Louisiana resident. After citing La. C.C. art. 14, the court concluded La. R.S. 22:1406(D)(1)(a)(iii) is not a provision otherwise expressly provided by the law of this state which requires application of Louisiana law without a conflict-of-law analysis. Id. at 344. In its analysis, the court emphasized the introductory paragraph of La. R.S. 22:1406(D)(1)(a)(iii) which states, D. The following provisions shall govern the issuance of uninsured motorist coverage in this state. Applying Louisiana's rules of statutory interpretation, the court concluded that the introductory paragraph of La. R.S. 22:1406(D)(1)(a)(iii) states unqualifiedly that the provisions enumerated thereafter apply to policies issued in Louisiana. Id. at 344. Further, the court stated: The Legislature did not change that qualification by amending the statute to include the language of LSA-R.S. 22:1406(D)(1)(a)(iii). As it is written, the amendment, which is one of the following provisions referred to in LSA-R.S. 22:1406(D), governs the issuance of UM coverage in Louisiana. Id. at 344-345. Therefore, the court affirmed the trial court's ruling that a choice-of-law analysis, as codified in Book IV of the Civil Code, specifically, La. C.C. arts. 3515 and 3537, is the appropriate starting point for determining which state's law should apply to the interpretation of the UM policy. Id. at 345. The first circuit court of appeal re-affirmed its Zuviceh decision in Dreisel v. Metropolitan Property and Casualty Ins. Co., 2001-2705 (La.App. 1st Cir.12/20/02), 836 So.2d 347, writ denied, XXXX-XXXX (La.3/28/03), 840 So.2d 575. Dreisel arose from a single-car accident in St. Tammany Parish, Louisiana involving Kathleen Dreisel, a Massachusetts resident, and guest passenger in a vehicle owned and operated by a Louisiana resident. On the date of the accident, Dreisel had in effect a UM policy issued to her and her husband by Metropolitan Property and Casualty Insurance Company (hereinafter Metropolitan). The policy was negotiated and issued in Massachusetts, and the vehicle was registered in Massachusetts. Dreisel sought to collect under the Metropolitan UM policy but was denied coverage based on a reduction clause contained in the policy. The policy, like Massachusetts law, provided for a dollar for dollar reduction in Metropolitan's liability based on monies the insured collected from the tortfeasor. Metropolitan argued that it had no liability under the UM policy since the tortfeasor's insurance company had already tendered to Dreisel the per person policy limit of $100,000, plus $5,000 in medical payments, an amount which exceeded Dreisel's $50,000 per person UM limit. As a result, Dreisel filed suit against Metropolitan in Louisiana. Following suit, Dreisel filed a motion for summary judgment asserting that Louisiana law, not Massachusetts, governed the interpretation of the UM policy. In response, Metropolitan filed a cross-motion for summary judgment arguing the reverse. The trial court granted Dreisel's partial motion for summary judgment, stating: [T]he accident occurred in Louisiana, the car in which Dreisel was riding at the time of the accident was registered in Louisiana and driven by a Louisiana resident, and significant medical treatment was rendered to Dreisel in Louisiana. Metropolitan appealed the trial court's ruling maintaining that Massachusetts law should be applied to a Massachusetts insurance contract that expressly provided that the policy would be governed by Massachusetts law. After citing relevant statutes  La. R.S. 22:1406(D)(1)(a)(iii) and La. C.C. art. 14  and noting the split in the circuits on this issue, the first circuit held that (b)ecause the policy under consideration in this case was issued in Massachusetts, as opposed to Louisiana, subparagraph (D)(1)(a)(iii) has no application. Id. at 350. Further, the court concluded that the objective is to identify the state whose policies would be most seriously impaired if its laws were not applied to the issue at hand. LSA-C.C. arts. 3515 and 3537. Id. at 350. Similar determinations have been made by the second and third circuit courts of appeal. In Anderson v. Oliver, 97-1102 (La.App. 3rd Cir.1/7/98), 705 So.2d 301, writ denied, 98-0755 (La.5/8/98), 718 So.2d 434, plaintiff, John Anderson, a Texas resident at the time of the accident, was struck by Cynthia Oliver in Acadia Parish, Louisiana as he exited the tractor-trailer he was driving to check his load. Plaintiff filed suit in Louisiana for his personal injuries and named several defendants, including Assicurazioni Generali, S.P.A. (hereinafter Generali), who had issued the UM policy that covered the trailer. The UM policy was negotiated and issued entirely outside of Louisiana through an insurance agent with offices in both North Carolina and Georgia to Morgan Southern, who leased the tractor from Eddie Waldrup of Houston, Texas. The policy complied with Georgia law. After the suit was commenced, Anderson filed a partial motion for summary judgment asking the court to apply Louisiana law, and not Georgia's, to the interpretation of the UM policy. The trial court granted the motion relying on the third circuit court of appeal's decision in Trautman v. Poor, 96-627 (La.App. 3rd Cir.12/11/96), 685 So.2d 516. In Trautman , the court held that when an accident occurs in Louisiana and involves a Louisiana resident, La. R.S. 22:1406(D)(1)(a)(iii) supercedes the choice-of-law rules in Book IV of the Civil Code and should apply to all liability policies providing UM coverage, even if issued and delivered in a foreign state to a resident of that state. Trautman at 521. After the trial court's ruling in the present case, Generali appealed asserting that the trial court's reliance on Trautman was erroneous and that La. R.S. 22:1406(D)(1)(a)(iii) was unconstitutional. On appeal, the third circuit court of appeal reversed the trial court's ruling and rejected the methodology employed by the Trautman court. Id. at 305. Instead, the court adhered to the approach set forth in Willett v. National Fire and Marine Insurance Co., 594 So.2d 966 (La.App. 3rd Cir.1992), writ denied, 598 So.2d 355 (La.1992), and Holcomb v. Universal Insurance Co., 93-1424 (La.App. 3rd Cir.6/1/94), 640 So.2d 718, writ denied, 94-1740 (La.10/7/94), 644 So.2d 643. In addition to re-affirming it decisions in Willett and Holcomb and rejecting the Trautman decision, the Anderson court determined that the appropriate rules for determining which state's law applied were La. C.C. arts. 3515 and 3537. Id. at 305. Similarly, in Adams v. Thomason, 32,728 (La.App. 2nd Cir.3/1/00), 753 So.2d 416, writ denied, XXXX-XXXX (La.6/16/00), 764 So.2d 965, plaintiff Bobby Adams was struck by a cotton trailer in Richland Parish, Louisiana while he was leaning on a parked truck occupied and operated by Rodney Grubisic. At the time of the accident, Grubisic had in force a UM policy that was negotiated and issued to him in Wisconsin by State Farm. Adams and his wife, Bonnie Adams, filed suit in Louisiana seeking damages for his injuries. State Farm, as Grubisic's insurer, was one of numerous named defendants. The trial court ruled that State Farm's UM policy provided coverage for the accident because according to the policy definitions, Adams was occupying the vehicle at the time of the accident. On State Farm's appeal, the court noted that since the enactment of La. R.S. 22:1406(D)(1)(a)(iii), the appellate courts have struggled with the question of whether the statute automatically requires application of Louisiana law or whether a conflict-of-laws analysis must be performed. Id. at 425. After a review of relevant decisions by the first and third circuit courts of appeal, the court concurred with the third circuit's decision in Anderson, supra, and concluded that it is more appropriate to conduct a full analysis of the conflict-of-laws principles involved than to merely rely upon La. R.S. 22:1406(D)(1)(a)(iii). Id. at 426. Thereafter, the court turned to La. C.C. arts. 3515 and 3537 to determine which state's law applied. For the reasons that follow, we agree with the conclusion reached by the first, second, and third circuit courts of appeal. We first observe that La. C.C. art. 14 and its comments were cited by the fourth and fifth circuit courts of appeal in support of their conclusions that La. R.S. 22:1406(D)(1)(a)(iii) automatically applies in multistate cases such as the present one. The comments emphasized by those courts state that the provisions of Book IV are not intended to supercede more specific choice-of-law rules contained in other Louisiana statutes, such as the Insurance Code.... Contrary to the holdings of those appellate courts, this language is inapplicable to La. R.S. 22:1406(D)(1)(a)(iii) because the statute is limited by the introductory language of La. R.S. 22:1406(D) which states that the statute  shall apply to the issuance of uninsured motorist coverage in this state. When interpreting a statute, all parts of a statute should be given effect, and an interpretation making any part superfluous or meaningless should be avoided. First National Bank of Boston v. Beckwith Machinery Company, 94-2065 (La.2/20/95), 650 So.2d 118. The lawmaker is presumed to have enacted each law with deliberation and with full knowledge of all existing laws on the same subject. Bunch v. Town of St. Francisville, 446 So.2d 1357 (La.App. 1st Cir.1984). The word shall in a statute represents mandatory language. La. R.S. 1:3. Additionally, when the wording of a statute is clear and free of ambiguity, the letter of the statute shall not be disregarded under the pretext of pursuing its spirit. La. R.S. 1:4. We find that the decisions by the fourth and fifth circuits discussed above violate this essential aspect of statutory interpretation because they fail to give effect to all parts of the statute. In fact, the introductory language of La. R.S. 22:1406(D), that the statute is applicable to UM coverage issued in this state, is omitted entirely from their discussions. The introductory language is clear and unambiguous and does not lead to absurd consequences. To hold otherwise would be to conclude that any accident occurring in Louisiana and involving a Louisiana resident is automatically governed by Louisiana law, irrespective of the foreign state's relevant public policies, pertinent contacts with this state, and the nature, type, and purpose of the contract involved. On the contrary, we conclude that the appropriate starting point in a multistate case such as the present one is to first determine that there is a difference between Louisiana's UM law and the UM law of the foreign state, and then to conduct a choice-of-law analysis, as codified in Book IV of the Civil Code, to determine which state's law applies to the interpretation of the UM policy. Thus, we affirm the choice-of-law methodology codified in La. C.C. arts. 3515 and 3537 and embraced by the first, second, and third circuit courts of appeal. We reject the automatic application of Louisiana's UM law adopted by the fourth and fifth circuit courts of appeal.