text:
    OMSI v. Alvin Joe ELLIOTT.
    No. 03-1178.
    Court of Appeal of Louisiana, Third Circuit.
    March 3, 2004.
    Rehearing Denied April 21, 2004.
    Jeffrey C. Napolitano, Keith E. Pittman, Juge, Napolitano, Guilbeau, Ruli & Frie-man, Metairie, LA, for Plaintiff/Appellant, OMSI.
    Patricia McKay Clotiaux, Waller & Associates, Metairie, LA, for Defendant/Ap-pellee, Repcon, Inc.
    Robert L. Beck, Jr., Rivers, Beck, Dal-rymple & Ledet, Alexandria, LA, for Claimant/Appellee, Alvin Joe Elliott, et al.
    Jeffrey Martin Cole, Plauche, Smith & Nieset, Lake Charles, LA, for Defendant/Appellee, Wyatt Field Service.
    Court composed of ULYSSES GENE THIBODEAUX, Chief Judge, JOHN D. SAUNDERS, and ARTHUR J. PLANCHARD , Judges.

       Judge Arthur J. Planchard, Retired, participated in this decision by appointment of the Louisiana Supreme Court as Judge Pro Tem-pore.

   BLANCHARD, Judge.

Plaintiff, OMSI, appeals a workers’ compensation judge’s (WCJ) decision dismissing Plaintiffs petition seeking indemnification and/or contribution from Defendants, Wyatt Field Service (Wyatt) and Repcon, Inc. (Repcon) as prescribed. We affirm the judgment of the WCJ.

FACTS

This case has a long history, dating back to Mr. Elliott’s original injury in 1987. The early history can be found in Elliott v. OMSI, 97-71, pp. 1-2 (La.App. 3 Cir. 4/30/97), 693 So.2d 847, 848, writ denied, 97-1841 (La.10/17/97), 701 So.2d 1327, where a panel of this court related the following:

Claimant filed his Form 1008 on May. 30, 1995, complaining that he had become disabled by injury on June 7, 1994. The basis of his complaint included allegedly disabling left arm and shoulder injuries and carpal tunnel syndrome, the latter of which was diagnosed by claimant’s treating physician without contradiction.
The matter was tried on the briefs and the record, which shows: the injuries relating to claimant’s shoulder constituted an aggravation of a pre-existing injury sustained on or about May 31, 1987, while claimant worked for Labor-tron, Inc., almost three years before claimant began working for the defendant in these proceedings; but that claimant’s carpal tunnel syndrome did not arise until after he became employed by OMSI and while working in the course and scope of his employment there.
After reviewing the record, the hearing officer concluded that claimant was entitled to wage and medical benefits due to the aggravation of his pre-exist-ing shoulder injury and for the new carpal tunnel syndrome.

Judgment was rendered by the WCJ on November 7, 1996. We affirmed the WCJ’s decision on April 30,1997.

| ¿The record establishes that Mr. Elliott left his employment with OMSI on March 27, 1994. After leaving his employment at OMSI, Mr. Elliott went to work as a boilermaker for Wyatt. He worked, off and on, for Wyatt from 1994 to sometime in 1997. He left his employment at Wyatt because of lack of work. There is no evidence that Mr. Elliott was in any accident or sustained any type of injury while employed by Wyatt. He filed no claim for benefits against Wyatt. After leaving Wyatt, Mr. Elliott was briefly employed by Repcon in OMahoma. Records from the workers’ compensation court of the state of Oklahoma show that Mr. Elliott, while employed by Repcon, sustained an injury to his right chest on October 31, 1997, and that his claim against Repcon, for that injury, was settled on May 28, 1998, for approximately $2,000.00. There is no evidence in the record that Mr. Elliott sustained a new injury or aggravated his prior injury to either his shoulder or carpal tunnel while employed by Wyatt or Repcon.

The record establishes that OMSI filed the instant PETITION FOR MODIFICATION OF JUDGMENT, INDEMNITY AND/OR CONTRIBUTION on March 16, 2001, against Repcon and Wyatt. Both named Defendants filed exceptions of prescription, no right of action and/or no cause of action. The exceptions were deferred to a hearing on the merits which was held on April 23, 2003. The WCJ, relying on Larkin v. Regis Hair Stylists, 02-127 (La.App. 3 Cir. 5/15/02), 817 So.2d 1266, sustained the exceptions of prescription as to both Defendants. OMSI appealed arguing that the Defendants are bound in solido with OMSI for the payment of benefits and that payment of benefits by OMSI interrupts prescription as to both Defendants.

LAW AND DISCUSSION

| .¡Louisiana Civil Code Article 1796 states: “Solidarity of obligation shall not be presumed. A solidary obligation arises from a clear expression of the parties’ intent or from the law.” OMSI argues that Wyatt and Repcon are bound with it in solido by law. We disagree.

At first blush, it would appear that OMSI’s argument is well founded.

The coextensive obligations for the “same thing” create the solidarity of the obligations. When it is not clear that the parties are all obliged to the same thing (as in the case of an agreement by several parties to repay a loan), then an obligation in solido is not presumed and must be expressly stipulated. La.C.C. Art.2093. However, when it is entirely clear that the parties are all obliged to the same thing (as when the law requires each of two or more parties to pay tort damages concurrently caused by each party), then there is an obligation in solido by definition, as a matter of law, and there is no need to presume solidarity. The presumption against solidarity is only .designed to be of assistance when it is necessary to determine whether an obligation is joint or soli-dary.
Thus, an employer and an employee are solidarily liable for damages caused by the employee’s negligence, although the employee’s liability is based on his act or omission (Article 2315) and the employer’s secondary and derivative liability is imposed by law on the basis of the relationship (Article 2320). While no statute or codal article stipulates soli-dary liability between the employer and the employee, the obligation is solidary as a matter of law. Both are obliged to the same thing (to repair the damage caused by the employee), neither is entitled to the benefit of division, and either may be compelled for the whole, so that payment by one exonerates the other toward the creditor. Foster v. Hampton, 381 So.2d 789 (La.1980); Sampay v. Morton Salt Co., 395 So.2d 326 (La.1981).

In the Hoefly case [Hoefly v. Government Employees Ins. Co., 418 So.2d 575 (La.1982)] ..., this court recently held that a timely suit against the tortfeasor interrupted prescription against the subsequently joined uninsured motorist carrier of the claimant, because the two defendants were solidary obligors. We held:

“An obligation is solidary among debtors when they are obliged to the same thing, so that each may be compelled for the whole, and when payment by one exonerates the other toward the creditor. When these characteristics result from provisions of law, as in the case of the obligation of the tortfeasor and uninsured motorist carrier, an obligation in solido exists without requiring an express declaration. LConsequently, the plaintiffs timely and properly filed suit against the tortfeasors interrupted prescription as to his uninsured motorist carrier.” 418 So.2d at 576.

Narcise v. Illinois Cent. Gulf R. Co., 427 So.2d 1192, 1194-95 (La.1983)(footnote omitted).

However, upon closer examination one finds that such is not the case. The judgment rendered by the WCJ in 1996 which forms the basis for OMSI’s obligation to pay benefits, was awarded for both a shoulder injury and for a carpal tunnel problem. Carpal tunnel syndrome is recognized as an occupational disease. La. R.S. 23:1031.1(B). After a lengthy discussion of solidarity among subsequent employers and the responsibility of subsequent employers to pay employees benefits for occupational diseases, the Louisiana Supreme Court reached the following conclusion:

In occupational disease cases under the workers’ compensation laws involving successive employers, an employer whose employment of a claimant has contributed causally to his disabling occupational disease is solidarily obliged to him for the whole obligation to pay workers’ compensation. As between successive employers contributing to an employee’s disabling occupational disease, the employer during whose employment the employee was last injuriously exposed to a cause of the occupational disease is fully responsible for all ivorkers’ compensation.

Gales v. Gold Bond Bldg. Products, 493 So.2d 611, 617 (La.1986)(emphasis ours). See also Ball v. Wendy’s Int’l., Inc., 36,922 (La.App. 2 Cir. 3/5/03), 839 So.2d 1208, writ denied, 03-978 (La.5/30/03), 845 So.2d 1056.

Inasmuch as there is no evidence in the record that Mr. Elliott had any carpal tunnel or shoulder problems in his subsequent employments and considering that a judgment of the Office of Workers’ Compensation, which has been affirmed by this court, found that Mr. Elliott’s carpal tunnel problems developed as a result of his | ¡^employment at OMSI, we find OMSI remains fully responsible for all workers’ compensation benefits and has no cause of action against either Wyatt or Repcon.

Inasmuch as we find OMSI has no cause of action against either Defendant, we need not address the issue of prescription.

Accordingly, for the reasons stated above, the judgment of the Office of Workers’ Compensation is affirmed. All costs of this appeal are assessed against Plaintiff/Appellant, OMSI.

AFFIRMED.

      . Judge Arthur J. Planchard, Retired, participated in this decision by appointment of the Louisiana Supreme Court as Judge Pro Tem-pore.


source: Caselaw Access Project

author: PLANCHARD, Judge.

license: Public Domain

text:
    OMSI v. Alvin Joe ELLIOTT.
    No. 03-1271.
    Court of Appeal of Louisiana, Third Circuit.
    March 3, 2004.
    Rehearing Denied April 21, 2004.
    Jeffrey C. Napolitano, Keith E. Pittman, Juge, Napolitano, Guilbeau, Ruli & Frie-man, Metairie, LA, for Plaintiff/Appellant, OMSI.
    Patricia McKay Clotiaux, Waller & Associates, Metairie, LA, for Defendant/Ap-pellee, Repcon, Inc.
    Robert L. Beck, Jr., Rivers, Beck, Dal-rymple & Ledet, Alexandria, LA, for Claimant/Appellee, Alvin Joe Elliott, et al.
    Jeffrey Martin Cole, Plauche, Smith & Nieset, Lake Charles, LA, for Defendant/Appellee, Wyatt Field Service.
    Court composed of ULYSSES GENE THIBODEAUX, Chief Judge, JOHN D. SAUNDERS, and ARTHUR J. PLANCHARD , Judges.

       Judge Arthur J. Planchard, Retired, participated in this decision by appointment of the Louisiana Supreme Court as Judge Pro Tem-pore.

   PLANCHARD, Judge.

For the reasons set forth in the companion case hereto, OMSI v. Alvin Joe Elliott, 03-1178 (La.App. 3 Cir. 03/03/04), 869 So.2d 300, 2004 WL 384895, the judgment of the trial court is affirmed. All costs of this appeal are assessed against Plaintiff/Appellant, OMSI.

AFFIRMED.

      . Judge Arthur J. Planchará, Retired, participated in this decision by appointment of the Louisiana Supreme Court as Judge Pro Tem-pore.


author: BAGNERIS, J.

text:
    LHO NEW ORLEANS LM, L.P. v. MHI LEASCO NEW ORLEANS, INC., Meridien Hotels, Inc., Nomura International PLC, Le Meridien Hotels & Resorts, Societe Des Hotels Meridien, Meridien S.A., and Juergen Bartels. MERIDIEN HOTELS, INC. and MHI LEASCO NEW ORLEANS, INC. v. LASALLE HOTEL OPERATING PARTNERSHIP, L.P.
    Nos. 2003-CA-1283, 2003-CA-1284.
    Court of Appeal of Louisiana, Fourth Circuit.
    March 3, 2004.

      William M. Bosch, Katten Muchin Zavis Rosenman, Washington, DC, A. Gregory Grimsal, Marcel Garsaud, Jr., Martin E. Landrieu, Deborah F. Malveaux, Gordon, Arata, McCollam, Duplantis & Eagan, LLP, New Orleans, Counsel for Plaintiff/Appellant.
    Michael S. Elkin, Thomas P. Lane, Gabriel M. Nugent, Thelen Reid & Priest, LLP, New York, NY, Bruce V. Schewe, Phelps Dunbar LLP, New Orleans, H. Alston Johnson, III, Phelps Dunbar, Baton Rouge, Counsel for Defendant/Appellee.
    (Court composed of Judge DENNIS R. BAGNERIS, Sr., Judge TERRI F. LOVE, and Judge MAX N. TOBIAS, Jr.).
   BAGNERIS, J.

Parties to this litigation are plaintiff/appellant, LHO New Orleans LM, L.P. (hereinafter referred to as “LaSalle”), the owner of the hotel Le Meridien New Orleans (hereafter referred to as “the hotel”), and MHI Leasco New Orleans, Inc. (hereinafter referred to as “MHI Leasco”), the tenant/operator/manager of the hotel. La-Salle seeks to reverse the trial court’s judgment confirming the arbitration panel’s decision and certifying the partial judgment as final.

In February 1998, LaSalle entered into a ten-year lease (hereinafter, “the lease”) for the hotel with MHI Leasco, a special-purpose entity wholly owned by Meridien Hotels, Inc. (hereinafter, “MHI”). Pursuant to the lease, MHI was able to continue its operation of the hotel pursuant to a management agreement with MHI Leasco.

For the following reasons, we affirm in part, reverse in part, and remand for further proceedings.

APPELLATE JURISDICTION

This appeal requires us to determine whether or not the trial court erred in certifying the partial judgment pursuant to LSAC.C.P. art. 1915(B). An appeal lies only from a final judgment of the trial court. LSA-C.C.P. arts. 1911 and 2083. A judgment that determines the merits in whole |4or in part is a final judgment. LSA-C.C.P. art. 1841. Whether a partial final judgment is appealable is determined by examining the requirements of LSA-C.C.P. art. 1915. This Court’s jurisdiction must be properly invoked by a final ap-pealable judgment. Thus, the issue is whether this is a final appealable judgment meeting the requisites of LSA-C.C.P. art. 1915.

In 1997, by Act No. 483, the Louisiana Legislature made significant changes with respect to the appealability of partial judgments. In re Succession of Grimmett, 31,975, p. 4 (La.App. 2 Cir. 3/5/99), 738 So.2d 27, 30. Prior to the 1997 amendments, article 1915 set forth exclusive classes of partial judgments, which were immediately appealable. Id. at pp. 2-4, 738 So.2d at 29-30. The 1997 amendments, patterned after Rule 54 of the Federal Rules of Civil Procedure, now require a certification procedure, which must be met before a partial adjudication can become immediately appealable. Id. A partial judgment rendered by a trial court shall not constitute a final judgment subject to an immediate appeal unless designated as a final judgment by the trial court after an express determination that there is no just reason for the delay, or unless specifically agreed to by the parties. LSA-C.C.P. art. 1915 B (1).

This case was filed after the 1997 amendment of LSA-C.C.P. art. 1915. Thus, the newer version is applicable to the instant case.

LSA-C.C.P. art. 1915 provides in pertinent part:

A. A final judgment may be rendered and signed by the court, even though it may not grant the successful party or parties all of the relief prayed for, or may not adjudicate all of the issues in the case[.]
* * *
B. (1) When the court renders a partial judgment or partial summary judgment or sustains an exception in part, as to one or more but less than all of the claims, demands, issues, or theories, whether | sin an original demand, recon-ventional demand, cross-claim, third party claim, or intervention, the judgment shall not constitute a final judgment unless it is designated as a final judgment by the court after an express determination that there is no just reason for delay. [Emphasis ours].

The first determination a trial court must make in certifying a partial judgment as immediately appealable under article 1915 is finality. Mark Tatum and William Norris, III, Summary Judgment and Partial Judgment in Louisiana: The State We’re In, 59 La. L.Rev. 131, 157-58 (1998). A trial court’s designation of a partial judgment as final, however, does not necessarily make that judgment immediately appealable. This Court’s appellate jurisdiction extends to “final judgments.” LSA-C.C.P. art. 2083. This Court is not bound by the trial judge’s certification of the partial adjudication as final for the purpose of an immediate appeal; we determine finality de novo. See Davis v. Specialty Diving, Inc., 98-0458, p. 5 (La.App. 1 Cir. 4/1/99), 740 So.2d 666, 669, writ denied, 99-1852 (La.10/08/99), 750 So.2d 972; Clark v. United States, 624 F.2d 3, 4 (2nd Cir.1980); Ryan v. Occidental Petroleum Corp., 577 F.2d 298, 302 (5th Cir.1978).

Although article 1915 dispenses with finality in the sense of completion of the litigation, the judgment rendered must be sufficiently final in that it disposes of the claim or dispute in regard to which the judgment is entered. See McMunn v. Hertz Equipment Rental Corporation, 791 F.2d 88, 90 (7th Cir.1986). Furthermore, in determining whether a partial judgment is a final one for the purpose of an immediate appeal, a court must always keep in mind the historic policies against piecemeal appeals. Banks v. State Farm Insurance Company, 30,868, p. 2 (La.App. 2 Cir. 3/5/98), 708 So.2d R523, 524; Doyle v. Mitsubishi Motor Sales of America, Inc., 99-0459 (La.App. 1 Cir. 3/31/00) 764 So.2d 1041.

The parties completed arbitration as ordered by this Court. MHI Leasco filed its motion to confirm the arbitration panel’s decision that was granted by the trial court. It then filed a motion to certify the judgment as final pursuant to LSA-C.C.P. art. 1915(B) (1). The trial court granted MHI Leasco’s motion and LaSalle appealed.

On appeal, LaSalle contends that the trial court erred in its certification of the partial judgment without hearing argument from counsel from LaSalle. LaSalle also argues the trial court failed to expressly state any reasons other than what it characterizes as a conclusory statement.

In its reasons for judgment, the trial court stated:

This Court notes the general statement of law in regards to partial judgments. Under Article 1915(B)(1) of the Louisiana Code of Civil Procedure, “When a court renders a partial judgment or a partial summary judgment or sustain an exception in part, as to one or more but less than all of the claims, demands, issues or theories, whether in an original demand, reconventional demand, cross-claim, third party claim, or intervention, the judgment shall not constitute a final judgment unless it is designated as a final judgment by the court after an express determination that there is no reasons for delay.”
In this case the partial judgment signed by the court was the judgment upholding the arbitration decision of the panel in the case at bar. Such judgment, in upholding the arbitration award, concisely fall under the realm of a partial judgment, which decides less than all of the issues in a case. Thus, this category of judgment may be deemed a final partial judgment under Article 1915(B)(1) of the Louisiana Code of Civil Procedure if the court makes the determination that delay is unnecessary. The court finds that no reason for such delay exists and thus enters the judgment as final.

After careful review, we find that this is a properly certified final judgment. First, valid certification of a partial judgment as final requires that the trial court give reasons on the record as to why there is no just 17reason for delay; mere conclusory statements do not generally suffice. Nalty v. D.H. Holmes Co., Ltd., 99-2826, p. 3-4 (La.App. 4 Cir. 12/27/00), 775 So.2d 695, 697; Jackson v. America’s Favorite Chicken Co., 98-0605 (La.App. 4 Cir. 2/3/99), 729 So.2d 1060. However, we review the certification on a case by case basis taking into consideration the totality of what was intended and whether in context conclusory statements equate to adequate reasons.

In the instant case, the trial court failed to state why there was no reason for delay of the defendants’ right to appeal the judgment and no specific reasons as to why there is no just reason for delay appear in the record. Thus, in the absence of a designation of the judgment as final through an express determination — i.e. a meaningful and considered articulation by the trial court — of no just reason for delay, a jurisdictional defect apparently exists.

After a review of this extensive record and the lengthy transcript of the arbitration proceeding, we first find that the trial court properly certified the partial judgment as appealable, because the judgment terminates certain issues in the suit as to the parties even though the same parties will continue to litigate the remaining issues of the holdover proceedings. In view of reductions to the various awards due to MHI/MHI Leasco’s failure to vacate the hotel on January 28, 2002, it would be inequitable to permit it to collect the full amount of the judgment from LaSalle until all adjustments are known and made. Finally, and most importantly, because we find that the arbitrators exceeded then-powers in connection with the award itself as explained below, the trial court properly certified the partial judgment as final.

\ CONFIRMATION of arbitration PANEL’S DECISION

LaSalle contends that the trial court erroneously confirmed and enforced the arbitration’s panel decision. It argues that the trial court confirmed the arbitration panel decision before it resolved several predicate and directly related claims. LaSalle argues that fair market value (hereinafter, “FMV”) is not a damage award, but instead represents the consideration it is to pay for the purchase of MHI Leasco’s leasehold interest in the event of a change of control pursuant to Section 22.22 of the lease between them.

LaSalle further contends that MHI Leasco is not entitled to FMV, and not entitled to FMV as of January 28, 2002, without any adjustments to account for MHI Leasco’s holdover. Additionally, it argues that the arbitration panel’s determination of FMV as of January 28, 2002 did not and could not resolve the parties’ dispute in its entirety.

LaSalle also contends that the arbitrators imperfectly executed their powers and that a mutual, final, and definite award upon the subject matter submitted was not made by the panel. It cites Holmes v. New Orleans Parish School Board, 95-2451, p. 13 (La.App. 4 Cir. 7/9/97), 698 So.2d 429, 436, writ denied, 97-2102 (La.11/14/97, 703 So.2d 630), for the proposition that a final and definite award must both resolve all the issues submitted to arbitration, and determine each issue fully so that no further litigation is necessary to finalize the obligation of the parties under the award. LaSalle contends the arbitration panel’s award did not make the appropriate adjustments to the security deposit that it could make under Section 15.1 of the lease.

LaSalle contends that the arbitration panel exceeded its authority by directing it to pay the value of MHI Leasco’s security deposit, by valuing 1 n“Other assets” besides the FMV of the leasehold interest, by awarding prejudgment interest from the date of MHI Leasco’s holdover, and by awarding attorney’s fees incurred in connection with the underlying litigation. La-Salle argues that the panel’s sole authority was to determine FMV. It contends it never agreed that the issue of MHI Leas-co’s entitlement to FMV be submitted to arbitration. Finally, LaSalle contends that the arbitration panel’s decision is a manifest disregard of the law and should be vacated.

In North Cent. Utilities, Inc. v. East Columbia Water Dist., 480 So.2d 901, 904 (La.App. 2 Cir.1985), unit not considered, 481 So.2d 1329 (La.1986), the Court held:

Arbitration is a mode of settling differences through the investigation and determination by one or more individuals appointed for that purpose. The object of arbitration is the speedy disposition of differences through informal procedures without resort to court action; (Citation omitted).
It is well settled in both state and federal courts that award may be challenged only on the grounds specified in the applicable arbitration statute. The court cannot substitute its conclusion for that of the arbitrator. In the furtherance of the purpose and intention of arbitration, the scope of judicial review as to the findings and conclusions of an arbitrator is severely restricted and the courts have consistently respected this limitation. Accordingly, a court does not ordinarily sit in an appellate capacity to an arbitration panel, but confines its determination to whether there exists one or more of the specific grounds for impeachment as provided for under the applicable statute.

This lawsuit began after MHI’s entire hotel management business was sold in July 2001. Article 22.22 of the lease between LaSalle as “Landlord” and MHI Leasco as “Tenant” provides in pertinent part:

22.22 Change of Control of Tenant. If, during the Term, any Parent or Affiliate (each a “Transferor ” of Tenant has elected to transfer its |ininterest in Tenant to a third party which is not an Affiliate of Tenant, which for the purposes of this Agreement shall only be permitted in conjunction with the sale of all, or substantially all, of Transferor’s hotel management businesses (a “Permitted Transfer ”), then such Permitted

Transfer shall be made only upon the following terms and conditions:

(a) Transferor shall give written notice of the proposed Permitted Transfer to Landlord (the “Sale Notice ”); (b) Landlord shall have thirty (30) days from the date of receipt of the Sale Notice to provide Transferor with written notice (the “Purchase Notice ”) of Landlord’s intention to purchase, in Landlord’s name or in the name of Landlord’s designee, Transferor’s interest in Tenant at the then Fair Market Value[1] of such interest (the “Purchase ”);
* :|: ‡
(f) If the parties fail to agree on the Fair Market Value of the respective interests in Tenant, the matter shall be referred to arbitration as provided for in Article 23; ....
[Emphasis in original]

Article 23 of the lease provides as follows:

23.1Arbitration. In each case specified in this Agreement in which it shall become necessary Into resort to arbitration, such arbitration shall be determined at provided in this Section 23.1. The party desiring such arbitration shall give Notice to that effect to the other party and an arbitrator shall be selected by mutual agreement of the parties, or if they cannot agree within thirty (30) days of such notice, by appointment made by the American Arbitration Association (“AAA ”) from among the members of its panels who are qualified and who have experience in resolving matters of a nature similar to the matter to be resolved by arbitration.
23.2 23.2 Intentionally Omitted.
23.3 Arbitration Procedures. In any arbitration commenced pursuant to Article 23, a single arbitrator shall be designated and shall resolve the dispute. The arbitrator’s decision shall be binding on all parties and shall not be subject to further review or appeal except as otherwise allowed by applicable law. To the maximum extent practicable, the arbitrator and the parties, and the AAA, if applicable, shall take any action necessary to insure that the arbitration shall be concluded within ninety (90) days of the filing of such dispute. The fees and expenses of the arbitrator shall be shared equally by Landlord and Tenant.
[Emphasis in original]

The arbitration proceedings took place in New York City in October 2002 before three American Arbitration Association arbitrators. Pursuant to the written contract between the parties, initially, the arbitrators were charged with determining only the FMV of MHI’s interest in MHI Leasco, the date on which the FMV was determined, the value of the security deposit that MHI Leasco was required to post before entering into the lease, and attorney’s fees for the prevailing party. However, after the proceedings began, the parties also agreed to arbitrate the additional issue of the payment of personal property taxes.

haThe panel heard several days of testimony in October 2002. On December 19, 2002, the following award was issued by the panel:

1. Respondent (LaSalle) shall pay to Claimant (MHI/MHI Leasco) the sum of Three Million Six Hundred Thirty-Nine Thousand Dollars and Zero Cents ($3,639,000.00) plus interest at 9% per annum from January 28, 2002, to date of payment.
2. Claimant’s demand for payment based upon management fees is denied.
3. Respondent shall pay to Claimant Six Hundred Sixty Five Thousand Dollars and Zero Cents ($665,000.00) plus interest from January 28, 2002, at 9% per annum for other assets.
4. Respondent shall pay to Claimant Two Million Two Hundred Twelve Thousand Dollars and Zero Cents ($2,212,000.00) representing the return of the security deposit. Said sum shall be due 30 days after Claimant vacates the premises and after any adjustments have been made pursuant to Article 15 of the Lease.
5. Respondent shall pay to Claimant the sum of Seven Hundred Thousand Dollars and Zero Cents ($700,-000.00) for Claimant’s legal fees and expert fees.
6. The majority of Arbitrators conclude that the lease did contain a scrivener’s error regarding personal property taxes and Respondent was liable for the payment of these taxes.
7. Based upon the evidence submitted, the majority determined fair market value as of January 28, 2002. Any adjustment for any period after January 28, 2002, has not been included in the above determination, since it was the majority’s view that these would be dealt with by the Court adjudicating the holdover proceeding.
8. Stenographer fees shall be paid (30%) by Claimant and (70%) by Respondent.
1-isiThe administrative fees of the American Arbitration Association (“the Association”) totaling $12,500.00 shall be borne 70% Respondent; 30% by Claimant; and in accordance with Article 23.3 of the lease, the Arbitrators compensation totaling $99,460.00 shall be borne equally by the Parties. Therefore, Claimant shall pay to the Association the sum of $6,055.00. Respondent shall pay to the Association $15,305.00, representing amounts still due the Association. These amounts reflect all payments made to date.
This Award is in full settlement of all claims and counterclaims submitted to this arbitration. All claims not expressly granted herein are hereby, denied.

As reflected in the arbitration award, one of the arbitrators dissented on the issue of the payment of personal property taxes, finding that the majority disregarded well-established Louisiana law as well as the lease itself. In addition, the dissenting arbitrator objected to the award of attorney’s fees to MHI/MHI Leasco based on a “record of ‘redacted’ invoices where the only description of services is either LaSalle New Orleans Litigation or LaSalle New Orleans Arbitration.”

LaSalle argues that the arbitration award itself should be amended, as the arbitrators exceeded the scope of their authority in various instances and the award evidences a manifest disregard of the law with respect to the issue on the payment of personal property taxes.

Louisiana’s Arbitration Law, La. R.S. 9:4201, et seq., provides in pertinent part:

§ 4210. Motion to vacate award; grounds; rehearing
In any of the following cases the court in and for the parish wherein the award was made shall issue an order vacating the award upon the application of any party to the arbitration.
|14P. Where the arbitrators exceeded their powers or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made.
Where an award is vacated and the time within which the agreement required the award to be made has not expired, the court may, in its discretion, direct a rehearing by the arbitrators.

The arbitrators recognized at the beginning of the proceedings that their job was to determine fair market value as set forth in the lease. As stated by the chairperson of the panel:

The judge didn’t ask us to say what should actually be paid. The judge asked us to reach a determination on fair market value.

In addition to FMV, the parties sought a declaration of the value of the security deposit and attorney’s fees. Finally, the parties submitted to arbitration the issue of which entity was responsible for the payment of personal property taxes. In substance the arbitrators were not authorized to make an award, only to declare amounts of money and responsibility of a party for same; in essence, these arbitrators were only authorized to render what amounts to a form of declaratory judgment, not to decree that one party should have an award over and against another party. Thus, the arbitrators far exceeded their authority in rendering an “award.”

As can be readily seen, the award is not a determination of FMV, but instead orders LaSalle to pay sums certain to MHI/ MHI Leasco. In that regard, the panel exceeded its authority and imperfectly executed its powers under the arbitration agreement. The arbitration award was to have declared the parties’ respective rights so that the underlying proceeding could proceed. The arbitrators themselves noted during the proceedings that adjustments would be made to the determination of FMV and the value of the security deposit since MHI/MHI Leasco did not vacate the hotel on 11RJanuary 28, 2002. The award itself even recognizes the holdover proceeding then pending in the Louisiana district court.

Finally, LaSalle contends that the arbitrators manifestly disregarded well-established Louisiana law on the personal property tax issue. “Manifest disregard of the law” by arbitrators is a judicially created ground for vacating an arbitration award and refers to error which was obvious and capable of being readily and instantly perceived by an average person qualified to serve as an arbitrator. The doctrine implies that the arbitrator appreciates existence of clearly governing legal principle but decides to ignore or pay no attention to it. Colchoneria Jiron, S.A. v. Blumenthal Print Works, Inc., 629 So.2d 1288, 1290 (La.App. 4 Cir.1993), writ denied, 94-0145 (La.3/11/94), 634 So.2d 391. The doctrine has been previously accepted by Louisiana courts. Id. at 1290. However, errors of fact or law do not invalidate a fair and honest arbitration award. National Tea Co. v. Richmond, 548 So.2d 930 (La.1989) citing St Tammany Manor, Inc. v. Spartan Bldg. Corp., 509 So.2d 424 (La.1987). Thus, the doctrine of “manifest disregard of the law” clearly requires more than simply an error of law on the part of an arbitrator.

In the case at bar, the parties agreed to submit the issue of payment of the personal property taxes to arbitration on the first day of the proceedings. The arbitrators heard extensive testimony on the language of the lease and the extensive negotiations that took place prior to the final signing of the lease. The arbitrators also heard testimony regarding LaSalle’s payment of the taxes for several years and the federal securities filings that indicated LaSalle’s responsibility to pay those taxes. Obviously, the arbitrators found a mutual mistake in the drafting of the lease and reformed the lease to | ^conform to the intentions of the parties. In any event, we find no manifest disregard of the law and find this assignment of error to be without merit.

Based on the above, we affirm the trial court’s certification of the judgment as ap-pealable; in all other respects, we reverse the judgment; and we remand the matter for further proceedings consistent with this opinion. Each party is to bear its own costs.

AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.

      . La. C.C.P. art. 2083 A permits appeals from "an interlocutory judgment which may cause irreparable injury....”

      . Article 1.45 of the lease defines "Fair Market Value” as follows:

        "Fair Market Value ” shall mean, as to a specific valuable asset, the purchase price which a seller would be able to obtain for such asset in an arms-length transaction with a buyer which is not an Affiliate of the seller, and taking into consideration all factors which might reasonably affect the sales price of the asset in questions, including, without limitation, if and as appropriate, the existence of a control block or minority interest, the anticipated impact on current market prices of immediate sale, the lack of a market for such asset, and the impact on present value of factors such as length of time before any such sales may become possible and the cost and complexity of any such sales. [Emphasis in original]

      . Article 3.1.3(a) of the lease provides that the tenant shall pay all personal property taxes. However, since the inception of the lease, LaSalle had been paying the taxes, a mistake it discovered shortly after the dispute arose among the parties. When LaSalle asked that MHI Leasco reimburse it for taxes paid and assume responsibility for payment of future personal property taxes, MHI Leasco refused.


author: SULLIVAN, Judge.

text:
    Donna M. PHILLIPS v. DIOCESE OF LAFAYETTE.
    No. 03-1241.
    Court of Appeal of Louisiana, Third Circuit.
    March 24, 2004.

      Christopher R. Philipp, Lafayette, LA, for Plaintiff/Appellee: Donna M. Phillips.
    Eric J. Waltner, Allen & Gooch, Lafayette, LA, for Defendant/Appellant: Diocese of Lafayette.
    Court composed of JIMMIE C. PETERS, MICHAEL G. SULLIVAN, and GLENN B. GREMILLION, Judges.
   SULLIVAN, Judge.

In this workers’ compensation case, the Diocese of Lafayette (the Diocese) appeals a judgment in favor of Donna Phillips rejecting its claim for forfeiture of benefits under La.R.S. 23:1208 and awarding Ms. Phillips penalties and attorney fees for a one-year delay in approving psychotherapy and biofeedback sessions recommended by her treating psychiatrist. Ms. Phillips has answered the appeal, seeking an additional penalty, as well as additional attorney fees for defending this appeal. We affirm and amend as follows.

Factual and Procedural Background

Ms. Phillips was injured on October 11, 1997, as she lifted two food trays while working in a school cafeteria. She was initially treated by Dr. Stanley Foster, an orthopedic surgeon, for pain in her neck and between her shoulder blades that radiated to the left hand and lower back. A cervical MRI indicated degenerative changes at C4-5, C5-6, and C6-7 that Dr. Foster related to some of her pain, as well as a small herniation at C6-7 that caused some compression of the thecal sac, but did not require surgery at that time. In May of 1998, Dr. Foster referred Ms. Phillips to a physiatrist, Dr. Thomas Laborde, who treated her with medication and steroid injections through July of 2002 for chronic pain, diffuse tenderness, and intermittent spasm and trigger points. During the course of his treatment, Dr. Laborde referred Ms. Phillips to a psychologist, Dr. Jimmie Cole, and to a psychiatrist, Dr. Charles Bramlet.

Ms. Phillips had also been evaluated by Dr. John Cobb, an orthopedic surgeon. After reviewing the cervical MRI and a thoracic MRI that showed spondylosis from T6 through T9, Dr. Cobb recommended a cervical fusion and thoracic injections, with a possible thoracic fusion from T6 through T9, should her pain in that area become 12unacceptable. Dr. Thomas Montgomery, another orthopedic surgeon, did not recommend surgery, as he found no evidence of a compressive neuropathy. The Office of Workers’ Compensation (OWC) then ordered an examination by a third orthopedic surgeon, Dr. Angela Mayeux. Dr. Mayeux saw no need for thoracic surgery, and she believed that the cervical procedure recommended by Dr. Cobb would have only a 50% chance of improving Ms. Phillips’ symptoms.

The Diocese disputed certain aspects of Ms. Phillips’ claim, which resulted in a judgment of March 16, 2001, recognizing her entitlement to supplemental earnings benefits (SEB) at a zero-earnings rate and declaring the reasonableness and medical necessity of the surgical procedure recommended by Cobb. Ms. Phillips never underwent that procedure, but she continued treatment for pain management with Dr. Laborde and Dr. Bramlet.

Dr. Bramlet first saw Ms. Phillips in January of 2001, when she reported a high level of cervical and lower back pain, which significantly limited her physical abilities, and a significant amount of depression and anxiety symptoms, including the loss of interest in pleasurable activities, crying spells, and problems with memory and concentration. Although Dr. Bramlet noted that Ms. Phillips was “a little dramatic with her presentation and detail,” he con-eluded that she met the criteria for chronic cervical and lower back pain, with some radiculopathy and a myofascial component. He also concluded that she exhibited an “anxiety disorder ... chronic in nature from trying to learn to deal with changes that goes [sic] along with dealing with this type of injury.” To improve her chances of returning to gainful employment, Dr. Bramlet believed it was necessary to be “extremely aggressive with her treatment” and to |3“really manage her psychological factors.” He proposed several medication changes, as well as ten individual therapy sessions and five biofeedback training sessions.

On February 5, 2001, the Diocese’s managed care company denied Dr. Bramlet’s request for continued psychotherapy as not “reasonable or necessary for this claimant’s soft tissue injury.” This denial was affirmed on February 28, 2001 and again on July 19, 2001, with the notation that “it is not reasonable to assume that a soft tissue injury could have precipitated a major psychiatric illness.” In the meantime, Dr. Bramlet, who continued to see Ms. Phillips for medication management, believed that she had decompensated since her initial visit, leading him to recommend a more intensive nine-week, half-day program to deal with the worsening of her condition caused by the delay in treatment.

On September 26, 2001, Dr. James Anderson, also a psychiatrist, examined Ms. Phillips at the Diocese’s request. Ms. Phillips reported that she experiences tightness in her neck that makes it hard to turn her head, aching under the shoulder blades, and pain around the mid-back and chest that “paralyzes” her. She stated that she is in pain almost every day and that if she did not take her pain medication she would be hurting all the time. Dr. Anderson noted that her MMPI-2 clinical profile, indicating neurotic tendencies, was valid. He further stated that standardized testing supported his clinical impression that a major component of Ms. Phillips’ pain is related to psychological issues and functional in origin. He believed that she could benefit from continued psychiatric treatment, including biofeedback, but he considered her a poor candidate for surgical intervention to relieve her pain.

When the Diocese did not provide the requested medical treatment after receiving Dr. Anderson’s report, Ms. Phillips filed this disputed claim for medical | benefits, penalties, and attorney fees on January 25, 2002. A mediation conference was held on March 19, 2002, after which the Diocese agreed to approve the requested treatment, but still contested the issues of penalties and attorney fees. On May 9, 2002, the Diocese asserted a claim for forfeiture of benefits based upon video surveillance that allegedly “chronicles her ability to move in normal fashion and free of pain.”

After a trial, the workers’ compensation judge (WCJ) rejected the Diocese’s forfeiture defense.' Although the WCJ noted that the surveillance was “somewhat at odds with Ms. Phillips’ dramatic complaints,” the WCJ found that this disparity did not warrant a finding of fraud, given corroboration at trial from Ms. Phillips’ neighbors and Ms. Phillips’ credible explanations for her conduct. The WCJ also concluded that the severity of Ms. Phillips’ complaints to her physicians was based upon unintentional exaggeration or neurotic tendencies as identified by Dr. Anderson in the MMPI-2 profile, rather than wilful misrepresentation. In awarding penalties of $2,000 and attorney fees of $5,000, the WCJ concluded that the Diocese could not rely on surveillance obtained in July of 2001 to reasonably controvert a claim for medical benefits that it initially denied in February of 2001.

Forfeiture of Benefits

In its first assignment of error, the Diocese argues that the WCJ erred in finding that it did not meet its burden of proving that Ms. Phillips violated La.R.S. 23:1208. That statute, in part, provides:

A. It shall be unlawful for any person, for the purpose of obtaining or defeating any benefit or payment under the provisions of this Chapter, either for himself or for any other person, to willfully make a false statement or representation.
RE. Any employee violating this Section shall, upon determination by workers’ compensation judge, forfeit any right to compensation benefits under this Chapter.

(Emphasis added.)

In Flintroy v. Scott Cummins Salvage, 36,857, p. 12 (La.App. 2 Cir. 3/10/03), 839 So.2d 1231, 1238, writ denied, 03-1068 (La.6/6/03), 845 So.2d 1093 (citations omitted), the court explained the application of La.R.S. 23:1208 as follows:

LalR.S. 23:1208 authorizes forfeiture of benefits upon proof that (1) there is a false statement or representation; (2) it is willfully made; and (3) it is made for the purpose of obtaining or defeating any benefit or payment. The statute applies to any false statement or misrepresentation made willfully by a claimant for the purpose of obtaining benefits. All of these requirements must be present before a claimant can be penalized. Because this statute is penal in nature, it must be strictly construed, both in its substantive ambit and in its penalty provisions.

Concerning the standard of appellate review of a forfeiture claim, the court in Rowan Cos., Inc. v. Powell, 02-1894, 02-1895, p. 6 (La.App. 1 Cir. 7/2/03), 858 So.2d 676, 680, unit denied, 03-2177 (La.11/14/03), 858 So.2d 425 (citations omitted), stated:

The determination of whether there is a false statement or representation willfully made for the purpose of obtaining any benefit or payment involves inherently factual determinations and, thus, this court’s review of those findings by the WCJ is governed by the manifest error standard. Under that standard of review, this court may only reverse the WCJ’s decision if we find (1) there is no reasonable factual basis for the finding in the record and (2) the finding is clearly wrong or manifestly erroneous.

The Diocese contends that video surveillance of Ms. Phillips contradicts statements that she made in her deposition and to her doctors concerning her gardening activities and the severity of her complaints. In her deposition, taken in April of 2002, Ms. Phillips admitted that she “piddles” with her flowers, including “pull[ing] weeds and stuff,” but she denied that she moves her window flower boxes | fiaround because, even though she can, she is “going to be hurting” or is “going to pay for it.” On the surveillance tapes obtained in July of 2001, however, Ms. Phillips is shown stepping through a large window several times onto her porch, where she moved two window boxes. At trial, Ms. Phillips testified that she had forgotten about that incident, explaining that she was moving the window boxes so that a neighbor could water her flowers while she was out of town.

In her deposition, Ms. Phillips described pain in her neck that restricts her ability to turn her head while driving; numbness in her hands, fingers, and feet; pain in both arms, worse on the left; and a heaviness in her legs that prevents her from walking at times. In July of 2001, about the time of the first surveillance taken, Ms. Phillips reported to Dr. Cobb that she was not improving and that the pain at times was so unbearable that she had to go to bed. During her individual therapy sessions in March of 2002, she reported to Dr. Bramlet’s nurse that she was overwhelmed by her chronic pain, which interferes with doing what she wants to do. In those sessions, she was tearful at times, reporting numerous symptoms of depression, including a low energy level, lack of sleep, low self-esteem, and social isolation. The Diocese argues that these complaints are inconsistent with the activities shown on the July 2001 surveillance tape, as well as surveillance obtained in January and February of 2002. In the later videos, Ms. Phillips is seen bending forward while rolling down a vehicle’s windows and while picking up something from the ground, walking up and down stairs, entering and exiting the passenger side of a vehicle, and covering the plants on her porch with a plastic bag.

The WCJ considered Ms. Phillips statement in her deposition that she had not moved her window boxes to be a “clear ‘misrepresentation’ ” in light of the |7surveillance taken in July of 2001, but she found that it did not amount to fraud. “After establishing that a claimant has made a false statement or misrepresentation ... the [WCJ] must make a factual determination as to whether, based on the record, the statement was willfully made specifically to obtain benefits, and thus defraud the workers’ compensation system.” Harris v. Christus St. Patrick Hosp., 02-1502, p. 6 (La.App. 3 Cir. 10/22/03), 857 So.2d 1278, 1283, writ denied, 03-3193 (La.2/13/04), 867 So.2d 697 (quoting Marler v. New Orleans Area Council, Boy Scouts of Am., 01-1167, pp. 7-8 (La.App. 5 Cir. 3/13/02), 815 So.2d 131, 135) (second alteration in original). In the present case, the WCJ apparently accepted Ms. Phillips’ explanation that she had forgotten about that occasion in July, in which she moved the window boxes so that a neighbor could water the flowers while she was out of town. We find no error in this credibility determination, given the corroboration of Ms. Phillips’ explanation at trial. In the video, Ms. Phillips is seen moving the window boxes from an area that is only accessible from inside her apartment toward a common porch area, which is consistent with her explanation that she moved them so that a neighbor could water them while she was away. Jackie Cormier, who lives in the same complex as Ms. Phillips, testified that she has seen Ms. Phillips tend to her flowers through her window only once, just before Ms. Phillips left town at the beginning of August 2001. Ms. Cormier also testified that she and other neighbors have moved Ms. Phillips’ large plants for her.

The WCJ next considered what she termed an “ambiguous ‘misrepresentation,’ ” in that Ms. Phillips activities on the tapes were “somewhat at odds” with her dramatic complaints to her doctors. However, the WCJ again found that Ms. Phillips’ did not commit fraud, considering that Dr. Anderson reported that | sher MMPI-2 profile includes “neurotic” tendencies and that Ms. Phillips exhibited some movements on the tapes that were “consistent with pain, age or deconditioning[.]” Again, we find no error. First, we note that the surveillance tapes do not appear to show Ms. Phillips performing activities that are inconsistent with the sedentary to light duty restrictions placed on her by her doctors. We next point out that some of Ms. Phillips’ complaints were corroborated by lay testimony at trial. Lisa Istre, who lived next door to Ms. Phillips from July of 1997 through October of 2000, testified that she has helped Ms. Phillips with her heavy housecleaning, including moving the large plants, cleaning the carpets, and mopping. Ms. Istre testified that she has seen Ms. Phillips grab her neck in pain and complain about picking up a bag of sugar. According to Ms. Istre, Ms. Phillips seems more mobile at some times, but worse at others. Ms. Cormier testified that Ms. Phillips calls her whenever she needs help. She has rearranged Ms. Phillips’ furniture and has moved her large plants. In her observation, Ms. Phillips has become worse since their first meeting in March of 2001. Although Ms. Cormier testified that she has seen Ms. Phillips tend to her flowers, she also stated that Ms. Phillips can only do so for about an hour and that pain is evident on her face when she is done.

In Bergeron v. Cajun Kwik Mart, Inc., 03-675, pp. 3-4 (La.App. 3 Cir. 11/5/03), 858 So.2d 748, 750, this court refused to disturb the WCJ’s rejection of a forfeiture defense, stating: “While there is some discrepancy between [the plaintiffs] testimony and what is depicted on the surveillance video, we, as did the [WCJ], find that these discrepancies do not equate to fraud, but rather reflect on the extent of her disability.” Similarly, in Palmer v. Schooner Petroleum Services, 02-397 (La.App. 3 Cir. 12/27/02), 834 So.2d 642, writ denied, 03-367 (La.4/21/03), 841 So.2d 802, |awe found that variances between the plaintiffs testimony and video surveillance of his activities did not support a finding of fraud, where the plaintiff testified that he has good days and bad days and that he suffers great pain when he exceeds his physical limitations, and where the video showed him walking slowly and tentatively, supporting his claim that he could not walk, stoop, or bend for extended periods of time. In the present case, we find no error in the determination that Ms. Phillips did not commit fraud, given the WCJ’s credibility determinations; the corroboration, both lay and medical, of her complaints; and the videotapes themselves, which do not depict Ms. Phillips performing activities beyond her physical restrictions.

Penalties and Attorney Fees

In its second assignment of error, the Diocese argues that the WCJ erred in imposing penalties and attorney fees, given its reliance on the utilization review process in denying the claim and the video surveillance that supported its forfeiture defense. The WCJ imposed these sanctions after determining that the Diocese could not rely on the subsequently-obtained surveillance to justify its failure to approve psychotherapy and biofeedback within sixty days of their request and that the utilization review process was insufficient to reasonably controvert the claim. We find no error.

In Harrington v. Coastal Construction & Engineering, 96-681, p. 3 (La.App. 3 Cir. 12/11/96), 685 So.2d 457, 459, writ denied, 97-109 (La.3/7/97), 689 So.2d 1375, we stated that “the employer must rely on competent medical advice when the decision to deny the medical treatment is made.” Accordingly, we held that the WCJ had erred in refusing to award penalties and attorney fees based upon the employer’s decision to schedule an independent medical examination after it had already denied |intreatment. As we explained: “The determination is erroneous because it looks to actions taken after the denial of treatment to support the denial of treatment.... [T]he [WCJ] was erroneous in utilizing post-denial actions to support a finding that Coastal was not arbitrary and capricious.” Id. at 459-60.

In Harrington, 685 So.2d at 460, we also addressed the reliance on utilization review to controvert a claim as follows:

In a letter dated November 10, 1995, and signed by a registered nurse, Harrington was informed that his request for physical therapy was denied based upon his “current medical status” and “the information obtained.” In Dozier [v. Garan’s, Inc., 94 — 1363 (La.App. 3 Cir. 4/5/95), 653 So.2d 137], this court held that simply producing a different opinion from a nurse and a doctor who had not examined the claimant did not, at that stage, reasonably controvert the claimant’s entitlement to the disputed medical expenses. Dozier, 653 So.2d 137. Furthermore, this court found, in Ramsey v. Cash and Carry Foods, Inc., 95-544 (La.App. 3 Cir. 11/2/95), 664 So.2d 511, that a lone report of questionable basis does not constitute “competent medical advice.” In the present case, Harrington’s request for physical therapy was denied by a nurse who had not examined him, based upon information which is, at best, questionable. The denial letter does not state what the employer thought Harrington’s “current medical status” to be, nor does it state what “information obtained” supported this decision. Based upon the jurisprudence established in Dozier and Ramsey, such evidence does not constitute “competent medical advice” sufficient to avoid the imposition of penalties and attorney fees.

In the present case, the request for psychotherapy and biofeedback was initially denied on February 5, 2001, after a managed care company determined that it was not “reasonably or necessary for this claimant’s soft tissue injury.” This decision was affirmed on February 28, 2001 and again on July 19, 2001, based upon a determination that “it is not reasonable to assume that a soft tissue injury could have precipitated a major psychiatric illness.” On July 25, 2001, Dr. Bramlet disputed this basis for denial, stating: “I am not suggesting that she has a major psychiatric illness. I am reporting that she has an adjustment disorder with both symptoms of depression Inand anxiety related to a chronic illness, such as a chronic pain disorder, which is clearly indicated from the history gathered from Mrs. Phillips that occurred in October of 1997.” (We also note that Ms. Phillips’ medical records, including two MRIs showing degeneration in three cervical discs and spondylosis at T6 through T9, indicate that she has more than a soft tissue injury.) The Diocese did not schedule an independent medical examination until September of 2001, six months after its initial denial of the claim, and that physician found that Ms. Phillips could benefit from the requested treatment. Additionally, the surveillance of Ms. Phillips did not take place until July of 2001. Based upon the above, we agree with the WCJ that the Diocese did not rely on competent medical advice or otherwise reasonably controvert the claim when it was denied in February of 2001. Accordingly, the imposition of penalties and attorney fees was not in error.

In her answer to the appeal, Ms. Phillips asks that we impose an additional penalty for the Diocese’s refusal to approve the requested treatment after it received Dr. Anderson’s report in October of 2001, indicating that psychotherapy and biofeedback would be beneficial to her. Although the supreme court concluded in Fontenot v. Reddell Vidrine Water District, 02-439, 02-442, 02-478 (La.1/14/03), 836 So.2d 14, that multiple penalties are recoverable under La.R.S. 23:1201, we find that a second penalty is not appropriate in this case. As the WCJ noted in her reasons for judgment, “[t]he videotaped surveillance would have constituted a reasonable controversion of Ms. Phillips’ request for Dr. Bramlet’s recommended treatment had those tapes been ‘in hand’ six months or so previous to when they were obtained.” However, the Diocese did have that surveillance by the time it received Dr. Anderson’s report. We agree with the WCJ that the surveillance sufficiently [ ^controverted the claim, notwithstanding Dr. Anderson’s report. We, therefore, decline to award a second penalty for the denial of Dr. Bramlet’s recommended treatment.

In her answer, Ms. Phillips also requests additional attorney fees for work performed on appeal. In Stacks v. Mayflower Transit, Inc., 95-693 (La.App. 3 Cir. 11/2/95), 664 So.2d 566, we held that an appellee who successfully defends a trial court judgment should not be denied additional attorney fees on appeal, even when the relief sought in his answer is denied. In the present case, Ms. Phillips successfully defended the judgment of the OWC in her favor. We, therefore, award her $2,000 in additional attorney fees.

Decree

For the above reasons the judgment of the Office of Workers’ Compensation is amended to award Plaintiff, Donna Phillips, additional attorney fees of $2,000. In all other respects, the judgment is affirmed. Costs of this appeal are assessed to Defendant, the Diocese of Lafayette.

AFFIRMED AS AMENDED.

      . Dr. Mayeux's report and deposition are not in the record before us, but a summary of their contents is contained in Dr. Anderson’s records.


author: SAUNDERS, J.

text:
    John T. BENNETT v. STATE FARM INSURANCE COMPANY.
    No. 03-1195.
    Court of Appeal of Louisiana, Third Circuit.
    March 24, 2004.

      DeWitt T. Methvin, Jr., Alexandria, LA, for Defendant/Appellant State Farm Insurance Company.
    Anthony Francis Salario, Marksville, LA, for Plaintiff/Appellee John T. Bennett.
    Court composed of ULYSSES GENE THIBODEAUX, Chief Judge, JOHN D. SAUNDERS, and ARTHUR J. PLANCHARD, Judges.

       Judge Arthur J. Planchard, Jr., Retired, participated in this decision by appointment of the Louisiana Supreme Court as Judge Pro Tem-pore.

   SAUNDERS, J.

The issues presented in this appeal arise from a dispute over the coverage provided by a homeowners insurance policy.

FACTS

The Plaintiff, John Bennett, hereinafter “Mr. Bennett”, had the property located at 153 Acton Road, Marksville, Louisiana, insured under a homeowners policy issued by the Defendant, State Farm Insurance Company, hereinafter “State Farm”.

On February 26, 2001, a storm damaged portions of Mr. Bennett’s home. Mr. Bennett duly reported the loss and on March 13, 2001, State Farm adjuster Gary Smith inspected the home and found damage to the home’s siding, soffit, fascia and the awning leading from the carport to the house. On March 15, 2001, State Farm tendered to Mr. Bennett a check in the amount of $878.88 which represented the amount of the Mr. Smith’s appraisal of the damages to Mr. Bennett’s house less Mr. Bennett’s policy’s deductible of $1,000.00. In his testimony, Mr. Bennett admitted that he had no repair work done on his home as a result of the storm damage of October 26, 2001.

On January 21, 2002, Marksville was again hit by a storm. Mr. Bennett duly reported another loss to State Farm. On February, 21, 2002, State Farm adjuster David Bates inspected Mr. Bennett’s home. Mr. Bates notified Mr. Bennett that the damage he was claiming was only the previous damage, for which he had already been paid, that had not been repaired. Therefore, State Farm made no payment in connection with Mr. Bennett’s claim of January 21, 2002.

On October 4, 2002, Marksville was struck by Hurricane Lily. Mr. Bennett duly reported another loss to State Farm. State Farm adjuster Paul McKennel inspected Mr. Bennett’s home. State Farm determined that the damage to Mr. | ¡¡Bennett's home resulting from the hurricane were less than Mr. Bennett’s deductible. Accordingly, State Farm made no payment in connection with Mr. Bennett’s claim of October 4, 2002.

On December 19, 2002, Mr. Bennett filed suit against State Farm alleging that State Farm failed to adhere to its responsibilities under its policy of insurance with Mr. Bennett by not paying him for the damage to his insured property. Additionally, Mr. Bennett claimed that State Farm misled Mr. Bennett concerning the applicable prescriptive period operable in his dispute with State Farm.

Trial of this matter occurred on June 5, 2003, before the Honorable Angelo Joseph Piazza, City Court Judge, Marksville, Louisiana. After hearing the testimony, reviewing the evidence and applicable law and hearing the arguments of counsel the court found in favor of Mr. Bennett and made the following awards. The court awarded $6,500.00 for removing and replacing damaged aluminum siding and wood; $600.00 for debris removal; $3,000.00 for replacement of the carport; $1,415.00 for one-half the cost of leveling the home; $2,585.00 for replacing damaged windows; $2,500.00 for damages pursuant to La.R.S. 22:1220; $2,500.00 in attorney fees pursuant to La.R.S. 22:658 and all costs of the proceedings.

On July 20, 2003, State Farm timely appealed.

ASSIGNMENTS OF ERROR

1. The trial court erred in awarding $600.00 for debris removal and $3,000.00 for replacement of the carport as a result of the February 21, 2001, storm.
2. The trial court erred in awarding $1,415.00 for one-half the cost of leveling the home.
3. The trial court erred in awarding $2,585.00 for replacing windows when the evidence showed that only screens had been blown off of the home.
4. The trial court erred in awarding $2,500.00 in damages pursuant to La.R.S. 1322:1220.
5. The trial court erred in awarding $2,500.00 in damages pursuant to La.R.S. 22:658.

LAW AND ANALYSIS

The standard of review for findings of the trial court has been clearly established in this circuit. A court of appeal may not set aside a judge’s factual finding unless that finding was manifestly erroneous or clearly wrong. Stobart v. State, through Dep’t. of Transp. & Dev., 617 So.2d 880 (La.1993). “Absent ‘manifest error’ or unless it is ‘clearly wrong,’ the jury or trial court’s findings of fact may not be disturbed on appeal.” Sistler v. Liberty Mut. Ins. Co., 558 So.2d 1106, 1111 (La.1990). “If the trial court or jury’s findings are reasonable in fight of the record reviewed in its entirety, the court of appeal may not reverse, even though convinced that had it been sitting as the trier of fact, it would have weighed the evidence differently.” Id. at 1112. However, when appellate courts find that a reversible error of law or manifest error of material fact was made in the lower court, appellate courts are required to redetermine the facts de novo from the entire record and render a judgment on the merits. McLean v. Hunter, 495 So.2d 1298 (La.1986); Otto v. State Farm Mut. Auto. Ins. Co., 455 So.2d 1175 (La.1984); Ragas v. Argonaut S.W. Ins. Co., 388 So.2d 707 (La.1980).

ASSIGNMENT OF ERROR NUMBER ONE

State Farms first assignment of error concerns the trial court’s awarding $600.00 for debris removal and $3,000.00 for replacement of Mr. Bennett’s carport as a result of the February 21, 2001, storm.

The purpose of homeowners insurance is to afford the insured protection from property damage losses. However, in order to hold State Farm liable for this aspect |4of Mr. Bennett’s claim, it must be clear that the replacement of the carport was necessitated by an event covered under Mr. Bennett’s policy of insurance with State Farm.

The first storm at issue in this ease took place February 26, 2001. State Farm adjuster Gary Smith’s report of March 13, 2001, indicates, among various other items of damage, that siding was blown off of the carport and that the covered canopy walkway between Mr. Bennett’s house and the carport was, for all intents and purposes, destroyed. State Farm tendered $878.88 is satisfaction of this claim. Mr. Smith’s report contains no evidence that the carport was so severely damaged as to necessitate replacement.

The second storm at issue in this case took place January 21, 2002. State Farm adjuster David Bates investigated Mr. Bennett’s claim at this time and found no additional damage caused to Mr. Bennett’s home as a result of this storm. In fact, Mr. Bennett admitted that he had made no repairs to his home between the occurrence of the storm of February 26, 2001, and the advent of the January 21, 2002, storm.

In letters dated February 20, 2002, and March 20, 2002, Mr. Bennett makes clear why no repairs were performed. The money tendered by State Farm, according to estimates obtained by Mr. Bennett, was inadequate to effectuate the repairs necessary. However, the letters to State Farm regarding the damages make no mention of a damaged carport. These letters only mention damaged siding and the destruction of the covered walkway between Mr. Bennett’s home and carport.

The third storm at issue in this case was Hurricane Lily which struck Marksville on October 4, 2002. The State Farm adjuster’s report finds only minimal damage to Mr. Bennett’s property as a result of the hurricane. No mention is made |sof the damaged carport. Additional damage to Mr. Bennett’s siding and windows was in evidence.

Ms. Laborde, the fiancé of Mr. Bennett, admitted that she had nothing to do with the adjustment process that occurred after the first two storms but was present for State Farm’s inspection after Hurricane Lily. In her testimony she noted that she took issue with the adjuster because, in her opinion, his estímate was too low considering that siding and screens were blown all over the yard. She did not mention the damaged carport to the adjuster. When shown a photograph of the carport after it was allegedly damaged, Ms. Laborde stated that the photograph, although not showing the damage she claimed was present, was merely taken at a disadvantageous angle. However, Ms. Laborde did testify that a wind storm had damaged the carport, that it was replaced, and that it cost $600.00 to have the debris removed. Specifically, Ms. Laborde stated that siding was blown off of the carport and that a rear section of the carport was bent down from where the aluminum had fallen or been lifted up by the storm. Mr. Bennett testified concerning the damage caused by Hurricane Lily and indicated that Ms. Laborde was in a better position to know what damage was caused by that storm. Additionally, an invoice from K & T Metal Works and a check were provided showing that $3,000.00 was paid for replacement of the carport.

When findings are based on determinations regarding the credibility of witnesses, the manifest error — clearly wrong standard demands great deference to the trier of fact’s findings. Rosell v. ESCO, 549 So.2d 840 (La.1989). The trial court was able to review the testimony of the parties; the documentary evidence showing that a carport was constructed and its cost; the evidence of State Farm which showed that | fithe carport, in their opinion, was not damaged such as to necessitate replacement; as well as photographs that reflect that a “roof carport” supported by thin metal legs was constructed. Accordingly, our review of the record supports the conclusion that the trial court did not commit manifest error in awarding $3,000.00 for replacement of the carport and $600.00 for the removal of debris.

ASSIGNMENT OF ERROR NUMBER TWO

State Farm’s second assignment of error concerns the trial court’s award of $1,415.00 to cover one-half the cost of leveling Mr. Bennett’s home. We affirm the decision of the trial court.

It is clear that Mr. Bennett’s home suffered damage as a result of the three storms. The majority of the damage centered on the destruction of the aluminum siding which was blown off of the house by the force of the various storm winds that struck Marksville in 2001 and 2002.

Accordingly, Mr. Bennett was entitled to have his insurer, State Farm, pay to have his siding and other covered losses repaired. The evidence showed that aluminum siding matching what was still located on the exterior walls of Mr. Bennett’s home was unavailable because aluminum siding of that type and specification was no longer in manufacture. Therefore, in order to properly repair Mr. Bennett’s home, the aluminum siding needed to be replaced with its modern equivalent, vinyl siding. The evidence also showed that in order for the new siding to properly fit the home must be level.

State Farm points to the exclusionary provision in its policy that indicates that repairs to the homes foundation is not covered. However, exclusionary provisions in insurance contracts are strictly construed against the insurer. Ledbetter v. Concord Gen. Corp., 95-0809 (La.1/6/96), 665 So.2d 1166, modified on other grounds, 95-0809 (La.4/18/96), 671 So.2d 915. The burden is on the insurer to prove that a loss comes within a policy exclusion. La. Maint. Serv., Inc. v. Certain Underwriters at Lloyd’s of London, 616 So.2d 1250 (La.1993).

Although the provision at issue arguably excludes coverage for leveling the house, the leveling of the home was incidental to the repair of Mr. Bennett’s damaged siding. In order to repair the siding correctly the home had to be leveled. If the home were not level the siding would not fit correctly and it would be unable to perform its intended purpose of protecting the home.

We note that our holding does harm to the effectiveness of the exclusionary provision under the circumstances of this case, however, we feel that where the duty to replace the siding conflicts with the exclusionary clause the specific and affirmative duty to repair is controlling. La.Civ.Code art. 2052; La.Civ.Code art. 2054.

ASSIGNMENT OF ERROR NUMBER THREE

State Farm’s third assignment of error concerns the trial court’s award of $2,585.00 to replace windows in Mr. Bennett’s home. As discussed is assignment of error number two, Mr. Bennett’s home suffered damages as a result of the three storms that required' the replacement of the home’s aluminum siding with vinyl siding. The evidence showed that in order to effectuate a proper repair it was necessary to replace Mr. Bennett’s windows in order to ensure that the new siding fit properly and was able to protect the home from the elements. Accordingly, we find that the window replacement was an incidental but necessary repair effectuated in order to ensure the replacement siding’s functionality.

I «ASSIGNMENTS OF ERROR NUMBERS FOUR AND FIVE

State Farm’s final assignments of error concerns the trial court’s award of $2,500.00 in penalties pursuant to La.R.S. 22:1220 and $2,500.00 in attorney fees pursuant to La.R.S. 22:658.

Mr. Bennett bases his claims for penalties and attorney fees on the fact that his policy of insurance was cancelled as a result of his numerous homeowners claims; that State Farm failed to fairly adjust his claims; and that State Farm misled him regarding the applicable prescriptive period operable in this dispute, thus entitling him to penalties and attorney fees pursuant to La.R.S. 22:1220 and La.R.S. 22:658.

Louisiana Revised Statute 22:1220 provides:

A. An insurer, including but not limited to a foreign line and surplus line insurer, owes to his insured a duty of good faith and fair dealing. The insurer has an affirmative duty to adjust claims fairly and promptly and to make a reasonable effort to settle claims with the insured or the claimant, or both. Any insurer who breaches these duties shall be liable for any damages sustained as a result of the breach.
B. Any one of the following acts, if knowingly committed or performed by an insurer, constitutes a breach of the insurer’s duties imposed in Subsection A:
(4) Misleading a claimant as to the applicable prescriptive period.
C. In addition to any general or special damages to which a claimant is entitled for breach of the imposed duty, the claimant may be awarded penalties assessed against the insurer in an amount not to exceed two times the damages sustained or five thousand dollars, whichever is greater. Such penalties, if awarded, shall not be used by the insurer in computing either past or prospective loss experience for the purpose of setting rates or making rate filings.
Louisiana Revised Statute 22:658 provides:
A. (1) All insurers issuing any type of contract, other than those |aspecified in R.S. 22:656, R.S. 22:657, and Chapter 10 of Title 23 of the Louisiana Revised Statutes of 1950, shall pay the amount of any claim due any insured within thirty days after receipt of satisfactory proofs of loss from the insured or any party in interest.
B. (1) Failure to make such payment within thirty days after receipt of such satisfactory written proofs and demand therefor, as provided in R.S. 22:658(A)(1), or within thirty days after written agreement or settlement as provided in R.S. 22:658(A)(2) when such failure is found to be arbitrary, capricious, or without probable cause, shall subject the insurer to a penalty, in addition to the amount of the loss, of ten percent damages on the amount found to be due from the insurer to the insured, or one thousand dollars, whichever is greater, payable to the insured, or to any of said employees, together with all reasonable attorney fees for the prosecution and collection of such loss, or in the event a partial payment or tender has been made, ten percent of the difference between the amount paid or tendered and the amount found to be due and all reasonable attorney fees for the prosecution and collection of such amount.

Neither statute provides for the imposition of penalties or attorney fees for the cancellation of a policy of insurance. Therefore, penalties and attorney fees are unavailable on those grounds.

Louisiana Revised Statute 22:1220 does not provide for the imposition of attorney fees. Louisiana Revised Statute 22:658 does provide for the imposition of attorney fees, but does not allow attorney fees to be assessed against an insurer for the failure to fairly adjust a claim or for misleading a claimant as to the applicable prescriptive period. Therefore, attorney fees are unavailable in this instance.

However, La.R.S. 22:1220(A) requires an insurer to fairly and promptly adjust its insured’s claims. Furthermore, La.R.S. 22:1220(B)(4) allows a court to impose penalties if an insurer misleads a claimant as to the applicable prescriptive period. Therefore, we will analyze whether the conduct of State Farm supports the trial |incourt’s award of penalties under La.R.S. 22:1220(A) and (B)(4).

As stated above, the insurer has an affirmative duty to adjust claims fairly and promptly and to make a reasonable effort to settle claims with the insured or the claimant, or both. La.R.S. 22:1220(A). A right of action is available to both insureds and third-party claimants under La.R.S. 22:1220. However, only the commission of one of the specific acts listed in La.R.S. 22:1220(B)(l)-(5) will support a private right of action under the statute. Theriot v. Midland Risk Ins. Co., 95-2895 (La.5/20/97), 694 So.2d 184; Smith v. Midland Risk Ins. Co., 29,793 (La.App. 2 Cir. 9/24/97), 699 So.2d 1192. Furthermore, La.R.S. 22:1220 is a penal statute and must be strictly construed, Harrington v. Cato Corp., 32,055 (La.App. 2 Cir. 6/16/99), 740 So.2d 732, and the insurer has the right to litigate claims without being subjected to damages and penalties. Darby v. Safeco Ins. Co., 545 So.2d 1022 (La.1989).

In order to determine whether the statements of State Farm’s adjuster were sufficient to mislead Mr. Bennett as to the applicable prescriptive period it is necessary to address what must be done to interrupt prescription other than filing suit within the prescriptive period.

Prescription is interrupted when one acknowledges the right of the person against whom he had commenced to prescribe. La.Civ.Code art. 3464. Interruption by acknowledgment may be oral, in writing, formal, informal, express or tacit. Gulf Coast Bank and Trust Co. v. Eckert, 95-156 (La.App. 5 Cir. 5/30/95), 656 So.2d 1081, writ denied, 95-1632 (La.10/6/95), 661 So.2d 474. The acknowledgment need not be of a certain amount of damages, only of the defendant’s responsibility and plaintiffs right against that defendant. Lima v. Schmidt, 595 So.2d 624 (La.1992).

In We note that the acknowledgment need not be in the form of a compromise agreement and, for that matter, it need not be in any particular form. Flowers v. U.S. Fid. & Guar. Co., 381 So.2d 378, 382 (La.1979). Additionally, a tacit waiver or interruption of prescription may be found if the insurer; (1) continues negotiations, thereby inducing the insured to believe the claim will be settled or not contested, (2) makes an unconditional offer of payment, or (3) performs acts of reparation or indemnity. Lima v. Schmidt, 595 So.2d 624, 634 (La.1992); Griffin v. Audubon Ins. Co., 94-0233 (La.App. 1 Cir. 12/22/94), 649 So.2d 72, 74, writ denied, 95-0229 (La.3/17/95), 651 So.2d 279. However, unless the insurer in some manner leads the insured to reasonably believe the time limitation has been waived while the claim is under consideration or in some other way acts so as to induce the insured to withhold suit, the suit must be filed within the prescribed period even if the claim is pending. Blum v. Cherokee Ins. Co., 336 So.2d 894, 898 (La.App. 4 Cir.1976).

The loss germane to this assignment of error was caused by the storm of February 26, 2001, suit was not filed until December 19, 2002. Since the petition shows on its face that the prescriptive period has run, the burden is on the plaintiff to prove interruption of prescription. Spott v. Otis Elevator Co., 601 So.2d 1355 (La.1992); Andrus v. Patton, 394 So.2d 714 (La.App. 3 Cir.1981); Emery v. Cabral, 400 So.2d 340, 342 (La.App. 4 Cir.), writ denied, 405 So.2d 533 (La.1981).

We find that the Plaintiff is unable to meet this burden considering the facts of this case. State Farm’s adjuster told Mr. Bennett that he had two years in which to effectuate any additional repairs to his home and that if State Farm subsequently found the repairs legitimate Mr. Bennett would be reimbursed for those costs. At no time did the claims adjuster of State Farm, even in the most general terms, discuss |iawith Mr. Bennett any prescriptive period. State Farm’s adjuster made no acknowledgment of State Farm’s intention to waive any prescriptive period nor did State Farm’s adjuster acknowledge any right or rights Mr. Bennett may have had concerning his claims vis-a-vis State Farm. State Farm in no way performed acts that would have tacitly acknowledged to Mr. Bennett that State Farm was waiving its rights under the prescriptive period. State Farm did not continue negotiations, make an unconditional offer of payment, or perform any acts of reparation or indemnity regarding the loss occasioned by the storm of February 26, 2001. State Farm’s adjuster’s statements simply could not lead the insured to reasonably believe the time limitation had been waived while the claim was under consideration nor did State Farm in some other way act so as to induce the insured to withhold suit in this instance.

Therefore, we find that the statements of State Farm’s claims adjuster were not such as to induce Mr. Bennett to believe that he had two years in which to file his claim as opposed to the one year period provided for in his policy of insurance with State Farm. Therefore, we reverse and hold that it was error for the trial court to award penalties and attorney fees in this case.

CONCLUSION

We affirm the trial court’s awarding $6500.00 for the repair of Mr. Bennett’s damaged siding, the $3,000.00 replacement cost of the carport, $600.00 cost to remove the debris of the destroyed covered walkway, the $1,415.00 for one-half of the cost required to level Mr. Bennett’s home and the $2,585.00 to replace the windows in Mr. Bennett’s home. We reverse the trial court’s $2,500.00 award of penalties pursuant to La.R.S. 22:1220 and the $2,500.00 award of attorney fees |13pursuant to La. R.S. 22:658. Therefore, we award Mr. Bennett $14,100.00, all costs of this appeal are to be assessed against State Farm.

AFFIRMED IN PART; REVERSED IN PART.