author: THIBODEAUX, Chief Judge.

text:
    Albert John ABSHIRE, et al. v. Clinton P. DESMOREAUX, et al.
    No. 07-626.
    Court of Appeal of Louisiana, Third Circuit.
    Nov. 7, 2007.
    Rehearing Denied Dec. 28, 2007.

      Robert Lawrence Beck, Jr., Rivers, Beck, Dalrymple & Ledet, Alexandria, LA, for Plaintiffs/Appellees — Albert John Ab-shire and Holly G. Struble.
    Keith Michael Borne, Borne, Wilkes, L.L.P., Lafayette, LA, for Defendant/Appellant — Safeway Insurance Company of Louisiana.
    Bonita K. Preuett-Armour, Armour Law Firm, L.L.C., Alexandria, LA, for Secondary Defendant/Appellant — State Farm Mutual Automobile Insurance Co.
    Court composed of ULYSSES GENE THIBODEAUX, Chief Judge, SYLVIA R. COOKS, and BILLY HOWARD EZELL, Judges.
   THIBODEAUX, Chief Judge.

| defendant-appellant, Safeway Insurance Company (Safeway), appeals the judgment ordering it to pay compensatory and exemplary damages arising out of a car accident caused by its insured’s permissive driver, Clinton Desormeaux (Mr. Desormeaux). Safeway contends that its liability coverage does not apply because its policy with the named insured, Frances Blood Desormeaux (Ms. Blood), is void ab initio due to material misrepresentations she made on her application for automobile insurance. Alternatively, Safeway argues that because exemplary damages are expressly excluded from coverage by its policy, the trial court erred in holding it liable for the payment of exemplary damages.

The uninsured/underinsured motorist (UM) carrier, State Farm Mutual Automobile Insurance Company (State Farm), has answered the appeal, alleging that the trial court’s judgment should be reversed because the allocation of damages erroneously resulted in it being held liable for the payment of damages that should have been paid by the primary liability insurer, Safeway. State Farm also contends that the trial court’s assessment to it of the payment of exemplary damages was improper because such damages are expressly excluded from UM coverage by the terms of its policy.

For the following reasons, the judgment of the trial court is affirmed in part, reversed in part, and rendered.

I.

ISSUES

1. Can the material misrepresentation defense be raised by an insurer to achieve the rescission of an insurance contract after an accident triggering the coverage has occurred?

2. Did Safeway satisfy its burden of establishing that its insured made material misrepresentations on her application of automobile insurance?

3. Did the trial court erroneously assess exemplary damages to the primary liability and UM insurance carriers?

4. Did the trial court misallocate damages, resulting in a forced exhaustion of the limits of the primary liability insurance carrier’s policy and a premature allocation of damages to the UM carrier?

II.

FACTUAL BACKGROUND

On the night of September 17, 2004, Mr. Desormeaux struck the rear of a pickup truck occupied by Holly Struble (Ms. Stru-ble), the truck’s owner, and her Mend, Albert Abshire (Mr. Abshire). Mr. Desor-meaux was also driving a pickup truck. The truck was titled to his girlfriend, Ms. Blood, and insured in her name only. Mr. Desormeaux fled the scene because he had been drinking; however, he was followed by the couple and apprehended by the Alexandria City Police a short time later. Mr. Desormeaux did not have a driver’s license at the time of the accident as a result of a prior traffic offense and license suspension. He was arrested and ultimately pled guilty to multiple charges, including Driving While Intoxicated (DWI).

Mr. Abshire and Ms. Struble subsequently filed a suit for damages against Mr. Desormeaux and Safeway, the liability insurer of the vehicle that he was driving at the time of the accident. The plaintiffs also sued State Farm, the UM carrier for Ms. Struble’s truck. In response to the lawsuit, Safeway alleged that its policy was void ab initio and did not provide liability coverage for the accident ^because of material misrepresentations made by Ms. Blood when she applied for coverage for the truck in January of 2004. Safeway alleged that in response to questions posed on its application for automobile insurance, Ms. Blood intentionally failed to disclose that Mr. Desormeaux, who she had been cohabitating with for six years at that time, was a resident of her household and that he would be an operator of the pickup truck. Safeway asserted that Ms. Blood intentionally omitted this information because she knew that his past driving offenses and lack of a driver’s license would negatively affect the ability to get coverage for the vehicle. Safeway argued that if Ms. Blood had disclosed that Mr. Desor-meaux was a member of her household and that he would be an operator of the truck that she sought to have insured, it would not have issued the automobile policy, Therefore, Safeway sought to have the policy declared void ab initio pursuant to La. R.S. 22:619.

Ji?he plaintiffs, in turn, argued that La. R.S. 22:655(D) and La.R.S. 32:900(F)(1) prevented Safeway from asserting the misrepresentation defense after the accident s occurrence. They argued that allowing an insurer to seek the rescission of a policy using this defense after a loss has occurred results in the evisceration of Louisiana’s compulsory liability insurance laws, leaving injured third parties vulnerable.

The trial court found that Mr. Desor-meaux was solely at fault for the accident based upon evidence introduced at trial that he was driving while intoxicated when he struck the plaintiffs’ vehicle. This finding is not challenged on appeal. The trial court also rejected Safeway’s material misrepresentation defense as a basis for rescinding the policy. The court agreed with the plaintiffs’ arguments and held that although misrepresentations may have been made by Mg_ Blood> any efforts to void pohCy were only available to Safeway prior £be accident. The trial court stated | Bthat this conclusion was “consistent with the public policy of [La.R.S.] 32;900 and [La.R.S.] 22:655.”

The trial court awarded the following compensatory damages for the injuries alleged to have been suffered by the plaintiffs as a result of the accident: general damages to Mr. Abshire — $1,500; general damages to Ms. Struble — $14,000; and medical expenses to Mrs. Struble— $1,176.50. The trial court also awarded exemplary damages, pursuant to La.Civ. Code art. 2315.4, in the amounts of $1,500 to Mr. Abshire and $5,000 to Ms. Struble. In summary, Mr. Abshire was awarded damages totaling, $3,000.00, and Ms. Stru-ble was awarded damages, totaling $20,176.50.

The trial court recognized that Safeway’s and State Farm’s coverages each had payment limits of $10,000 per person and $20,000 per accident and that State Farm had already tendered a $2,000 payment to Ms. Struble prior to trial. The trial court, consequently, rendered a judgment stating that Safeway and Mr. Desor-meaux were jointly and solidarily liable for the payment of the $3,000.00 award to Mr. Abshire. The trial court then held Safeway and Mr. Desormeaux jointly and soli-darily hable to Ms. Struble for $10,000.00, as this was the maximum amount of coverage available to Ms. Struble under Safeway’s policy. State Farm was held jointly and solidarily liable with Mr. Desormeaux for the payment of $8,000.00 to Ms. Stru-ble, which absorbed the remaining coverage available to her under the UM policy. The court then held Mr. Desormeaux solely liable for the payment of the remaining $2,176.50 of Ms. Struble’s damages. The court did not distinguish ^between compensatory and exemplary damages when apportioning liability for the payment of the damages awarded.

Safeway has appealed and now asserts that the trial court erred in ruling that the defense of material misrepresentation cannot be asserted after a loss has occurred. Safeway also contends that it carried its burden of proof and established that Ms. Blood intentionally made misrepresentations that were material to its decision to grant coverage. Alternatively, Safeway argues that the trial court erred in holding it jointly and solidarily liable with Mr. Desormeaux for the payment of any exemplary damages because its policy expressly excludes exemplary damages from coverage.

State Farm has answered the appeal. It also challenges the trial court’s allocation of damages. Specifically, State Farm contends that the trial court failed to exhaust the limits of Safeway’s liability policy prior to assessing damages to it. It asserts that the trial court should have exhausted Safeway’s policy limits that were available to each plaintiff for the payment of compensatory damages and, then, should have ordered payment of any remaining compensatory damages by State Farm. State Farm, contends that the trial court’s failure to do this resulted in it — the UM carrier — being ordered to pay compensatory damages that the primary liability policy was able to cover. State Farm also seeks to have the assessment of exemplary damages to it reversed, arguing that exemplary damages are expressly excluded by its policy.

_kin.

LAW AND DISCUSSION

Material Misrepresentations

1. Can the material misrepresentation defense of La.R.S. 22:619 be asserted to rescind an automobile liability policy after a loss has occurred?

The question of whether the trial court properly ruled that the material misrepresentation defense could not be raised after the occurrence of the car accident giving rise to the loss occurred is a legal question, requiring a de novo review by this court to determine whether the trial court’s conclusion was legally correct or incorrect. Foster v. ConAgra Poultry Co., 95-793 (La.App. 3 Cir. 2/14/96), 670 So.2d 471, writ denied, 96-0645 (La.4/26/96), 672 So.2d 674. We find that the trial court did commit legal error in ruling that the material misrepresentation defense cannot be asserted after an accident has occurred. Louisiana jurisprudence contains many examples in which the material misrepresentation defense has been raised as a defense to a liability claim after an accident has occurred. See Tabchouri v. Progressive Ins. Co., 00-134 (La.App. 3 Cir. 12/6/00), 775 So.2d 1127; Pryor v. State Farm Mut. Auto. Ins. Co., 663 So.2d 112 (La.App. 3 Cir. 8/30/95); Jamshidi v. Shelter Mut. Ins. Co., 471 So.2d 1141 (La.App. 3 Cir. 1985). In fact, this state’s supreme court and virtually all of this state’s circuits have customarily reviewed cases in which the application of the material misrepresentation defense set forth in La.R.S. 22:619 was raised by an insurer after the date of loss, and in many instances, the courts have affirmed or found that the facts justified the rescission of the purported coverage because of misrepresentations that were made at the time the insurance was procured. See Coleman v. Occidental Life Ins. Co. of N. Carolina, 418 So.2d 645 (La.1982); Cousin v. Page, 372 So.2d 1231 (La.1979); Gulf Wide Towing, Inc. v. Associated Ins. Managers, Inc., 563 So.2d 432 (La.App. 1 Cir.1990), writ denied, 567 So.2d 107 (La.1990); Benton v. Shelter Mut. Ins. Co., 550 So.2d 832 (La.App. 2 Cir.1989); Bieser v. American Deposit Ins. Co., 95-555 (La.App. 5 Cir. 12/13/95), 666 So.2d 1158.

In addition, we recognize that the particular question of whether this defense is barred after an accident has occurred has been addressed by the appellate courts before and agree that La.R.S. 32:900(F)(1) does not bar the assertion of this defense after a potentially covered loss has occurred. See Kennedy v. Audubon Ins. Co., 82 So.2d 91 (La.App. 1 Cir.1955); Grain Dealers Mut. Ins. Co. v. Miller, 142 So.2d 458 (La.App. 3 Cir.1962). The Kennedy and Grain cases held that La.R.S. 32:900(F)(1) does not prevent the rescission of an automobile liability policy which has not been certified as a “Motor Vehicle Liability Policy,” for the purpose of serving as proof of financial responsibility under the Motor Vehicle Safety Responsibility Law (La.R.S. 32:851, et seq.). This court has previously recognized this distinction and has also held that La.R.S. 32:900 does not necessarily apply to all automobile liability insurance policies. See Breaux v. Claudel, 93-1580 (La.App. 3 Cir. 6/1/94), 640 So.2d 744. This distinction was explained further in Hearty v. Harris, 574 So.2d 1234, 1239 (La.1991):

A. Applicability of La.R.S. 32:900
The plaintiffs fail to discern the distinction between a ‘motor vehicle liability policy’ and an ‘automobile liability policy.’ The term “motor vehicle liability policy” |9is defined by La.R.S. 32:900(A) as ‘an owner’s or an operator’s policy of liability insurance, certified as provided in R.S. 32:898 or 32:899 as proof of financia! responsibility, and issued ... by an insurance carrier duly authorized to transact business in this state.... ’ By purchasing a ‘motor vehicle liability policy’ an owner or operator satisfies the requirements of the LMVSRL. In contrast, an ‘automobile liability policy’ is a voluntary policy which has not been certified as proof of a motorist’s financial responsibility and does not therefore satisfy the requirements of the LMVSRL.

There is no proof in the record that Safeway’s policy was certified as a “Motor Vehicle Liability Policy” for purposes of La.R.S. 32:856, et seq.

Additionally, we interpret La.R.S. 32:900 as that which intends to prevent collusion between an insurer and insured. It is not intended, in every instance, to limit the assertion of the misrepresentation defense to the time period prior to an accident’s occurrence. Insurers must rely on the representations and warranties provided to them by insureds and typically do not become aware of prior misrepresentations until after a loss has occurred and a claim is pending; therefore, the application of La.R.S. 32:900(F)(1) as urged by the plaintiffs would severely restrict an insurer’s ability to protect itself from such unsavory practices. We do not believe this was the legislature’s intent.

Accordingly, we find that the trial court legally erred in ruling that Safeway was precluded from raising the material misrepresentation defense set forth in La.R.S. 22:619, simply because a potentially covered loss had occurred. Because we owe no deference to any subsequent factual findings made by the trial court because of this error, we must undertake a de novo review of the record as to whether Safeway carried its burden of proof on the issue of whether Ms. Blood made material misrepresentations sufficient to rescind the automobile policy. Roberts v. Hartford Fire Ins. Co., 05-1178 (La.App. 3 Cir. 4/5/06), 926 So.2d 121, writ denied, 06-1056 (La.6/23/06), 930 So.2d 984.

2. Did Safeway prove that material misrepresentations, justifying rescission of the policy, were made when the insurance was procured?

As stated by the supreme court in Coleman, 418 So.2d 645 (citations omitted), “[t]he statute [La.R.S. 22:619] requires that a false statement bars recovery only if it is made with the intent to deceive or it materially affects the risk. Louisiana jurisprudence requires both factors.” The insurer raising this defense bears the burden of proof. Id. (citing Cousin, 372 So.2d 1231).

The intent to deceive component is “determined from the surrounding circumstances, indicating the insured’s knowledge of the falsity of the representations made in the application and his recognition of the materiality of his misrepresentations, or from circumstances which create a reasonable assumption that the insured recognized the materiality.” Tabchouri, 775 So.2d at 1129 (citing Cousin, 372 So.2d 1231). A misstatement is “material” pursuant to La.R.S. 22:619, if the truth would have resulted in the insurer not issuing the policy of insurance or issuing the policy at a higher rate. Pryor, 663 So.2d 112; Irving v. U.S. Fidelity & Guar. Co., 606 So.2d 1365 (La.App. 2 Cir.1992). We do not find that Safeway carried its burden of proving that the misrepresentations were material or that Ms. Blood intended to deceive the insurance company in order to gain coverage for the vehicle.

Safeway submitted the affidavit of its litigation supervisor, Lisa Guidry, in efforts to establish the materiality of the misrepresentations made by Ms. Blood— that no other person of licensed age lived at her residence and that there were no other operators of the truck that she was seeking to insure. However, Ms. Guidry’s affidavit stated that “if Safeway Insurance Company of Louisiana had been |T1aware that Clinton P. Desormeaux (an unlicensed driver at the time of the application for insurance due to a license suspension) was the actual owner of the 1992 Chevrolet 1500 pickup truck, and was the principal operator of this vehicle, Safeway would not have written the policy.” We find that Ms. Guidry’s attestations do not address the materiality of the actual misrepresentations at issue, and that she has based her attestations on facts that were not established at the trial of this matter.

Specifically, the record establishes that on January 30, 2004, the then twenty-three year old Ms. Blood met with an insurance agent alone to procure automobile insurance for the 1992 Chevrolet pickup truck that was later involved in the September 17, 2004, accident at issue. Ms. Blood has an eighth grade education. The vehicle was titled in her name; however, she and Clinton had shared a household for approximately six years and had purchased multiple vehicles together that were used by them jointly. The pickup truck at issue in this case was no different. Ms. Blood and Mr. Desormeaux both testified at trial that the truck at issue was titled in her name only. No contradictory evidence was produced to negate this assertion. In addition, they testified that they both drove the pickup truck, equally sharing its use. No evidence is in the record to contradict this.

Moreover, Ms. Blood testified as to her perception that she was not being deceitful with the insurance company because she was seeking to insure the vehicle only in her name:

Q. Now you testified earlier that because Clinton didn’t have a driver’s license that you knew he couldn’t get insurance, right?
A. Yes m’am.
Q. But did you still think that because you had a driver’s license that you could get insurance for him?
|1?A. Yes m’am.
Q. So you didn’t think there was a problem with you going in to [sic] the agency and as long as you paid money that because you had this license that you could get insurance that covered you and him?
A. Yes m’am.
Q. You didn’t see anything wrong with that did you?
A. No m’am.
Q. Did you think that you were in any way deceiving or being deceitful with an insurance company?
A. No m’am.
Q. Cause you, did you think that because you were paying seven hundred and twenty two dollars for two vehicles to this agency that you and anybody who operated your vehicle that you gave permission to was gonna have coverage.
A. Yes m’am.

The supreme court in Cousin, 372 So.2d 1231, explained that intent to deceive is determined from the circumstances surrounding not only the insured’s knowledge of the falsity of his or her representations, but is also determined from the insured’s recognition of the materiality of those representations. We do not find that Safeway carried its burden of proving that Ms. Blood truly recognized the purported materiality of her misrepresentations. Therefore, we find that Safeway did not carry its burden of establishing material misrepresentations that would support the rescission of its automobile policy pursuant to La.R.S. 22:619.

Allocation of Damages

The issue of whether Mr. Desormeaux was covered by the policy, absent any challenges to the validity of the policy, was not raised at trial or on appeal. | ^Consequently, we need not address that issue, and move directly to consideration of the court’s allocation of damages among the defendants.

Mr. Abshire suffered soreness and stiffness in the neck and upper back for approximately two weeks after the accident. A few days after the accident occurred, Ms. Struble, who was riding on the passenger side of the truck, sought medical treatment for pain and stiffness in her right arm that arose after she hit it on the armrest of the vehicle’s door during the accident. At the time of trial approximately two years later, Ms. Struble testified that she still suffered from recurrent pain and stiffness in her right arm. The quantum of the awards to the plaintiffs has not been challenged on appeal.

However, Safeway, alternatively, and State Farm, in its answer to Safeway’s appeal, both seek review of the trial court’s allocation of damages. Safeway contends that its policy expressly excludes exemplary damages and, therefore, argues that it should not have been held jointly and solidarity hable with Mr. Desormeaux for the payment of the exemplary award of $1,500.00 to Mr. Abshire. State Farm, who asserts that its policy also expressly excludes exemplary damages, argues that the trial court’s allocation was improper because it resulted in State Farm, as the UM carrier, being charged with satisfying the payment of compensatory damages that were compensable under Safeway’s policy. In other words, State Farm argues that the trial court’s allocation did not properly allow for the primary policy’s limits to be exhausted before applying UM coverage.

Specifically, State Farm asserts that the trial court should have applied the limits of Safeway’s $10,000 per person/$20,000 per accident liability coverage to pay the total of Mr. Abshire’s general damages, totaling $1,500.00. Next, it suggests that the trial court should have ordered Safeway to tender its policy limit ofj^lO,000.00 to Ms. Struble as compensation towards her $14,000.00 general damage award. State Farm asserts that its UM coverage should have then been responsible for covering the remaining $4,000.00 of Ms. Struble’s compensatory damages and her medical expenses of $1,176.50. Considering its credit for the pretrial payment of $2,000.00 to Ms. Struble, State Farm contends that the judgment against it should have totaled only $3,176.50 rather than $8,000.00. Both State Farm and Safeway argue that Mr. Desormeaux should have been held solely liable for the payment of all of the exemplary damages awarded.

We agree with these arguments. The trial court abused its discretion in the allocation of damages between the parties. In this case, the trial court’s allocation erroneously overlooked the express rejections of the payment of exemplary damages in both policies. Moreover, the trial court’s allocation of damages has yielded a |1BresuIt that is contrary to the intent of UM coverage in this State because it did not fully exhaust the limits of the primary carrier before accessing the UM carrier’s limits. See La.R.S. 22:680(l)(a)(i). In a similar factual scenario, the first circuit addressed this issue and explained:

The legislative aim of the uninsured motorist statute is to promote full recovery for damages suffered by innocent automobile accident victims by making uninsured motorist coverage available for their benefit as primary protection when the tortfeasor is without insurance and as additional or excess coverage when he is inadequately insured. Hoefly v. Government Employees Ins. Co., 418 So.2d 575, 578 (La.1982). Punitive damages do not provide compensation for bodily injury; rather, | ^compensatory damages compensate an injured party for the injury sustained by replacing the loss caused by the injury. Exemplary or punitive damages are awarded to the plaintiff over and above compensatory damages and are intended to punish the defendant or make an example of him in order to deter any such future conduct. See BLACK’S LAW DICTIONARY 352 (5TH ed.1979).
We believe it is contrary to the intent of the law to ignore the express exclusion for punitive damages in the State Farm policy and allow plaintiff to recover under that policy due to a forced exhaustion of the underlying limits by the punitive damage award. We feel that a compensatory damage award should be satisfied first, by exhausting the primary policy. Then punitive damages, which are awarded over and above compensatory damages, would be satisfied under the excess UM policy. In this case, that excess policy expressly excludes punitive damages. We do not believe that the purpose and intent of the UM statute is served by specifically allocating damages so as to achieve the exhaustion of the underlying policy limits by a punitive damage award. Moreover, requiring payment under a UM policy under this factual scenario neither punishes nor deters the tortfeasor and, thus, does not serve the purpose behind an award of punitive damages.

Malbreaugh v. CNA Reinsurance Co., 2003-2088, p. 4 (La.App. 1 Cir. 9/17/04), 887 So.2d 494, 496-97. (Footnote omitted).

We agree with this reasoning and apply it to the facts of this case. We, too, find that the trial court abused its discretion in allowing recovery of compensatory damages from the UM carrier State Farm, prior to exhausting Safeway’s policy limits for the payment of these damages. Moreover, we find that the polices of both Safeway and State Farm excluded exemplary damages. Accordingly, we reverse the trial court’s allocation of damages and reallocate damages as follows:

Safeway and Mr. Desormeaux are jointly and in solido liable for $1,500.00 in general damages to Mr. Abshire;

_JjjMr. Desormeaux is solely liable for $1,500.00 in exemplary damages to Mr. Abshire;

Safeway and Mr. Desormeaux are jointly and in solido liable for $10,000.00 in general damages to Ms. Struble;

State Farm and Mr. Desormeaux are jointly and in solido liable for $1,176.50 in medical expenses and $2,000.00 in general damages to Ms. Struble (recognizing the $2,000.00 credit to State Farm for its pretrial payment of that amount to Ms. Stru-ble); and

Mr. Desormeaux is solely liable for $5,000.00 in exemplary damages to Ms. Struble.

IV.

CONCLUSION

For the foregoing reasons, the judgment of the trial court is affirmed in part, reversed in part, and rendered. Defendants-appellants, Safeway Insurance Company of Louisiana and Clinton P. Desormeaux are liable, jointly and in solido, for general damages to plaintiff-appellee, Albert John Abshire, in the amount of $1,500.00, and $10,000.00 in general damages to plaintiff-appellee, Holly G. Struble. Defendant Appellant-Appellee, State Farm Mutual Automobile Insurance Company and Clinton P. Desormeaux are liable, jointly and in solido, for the payment of general damages in the amount of $2,000.00 to Holly G. Struble and $1,176.50 in medical expenses to Holly G. Struble. Clinton P. Desor-meaux is solely liable for the payment of exemplary damages in the amount of $1,500.00 to Albert John Abshire and $5,000.00 to Holly G. Struble.

^JjjCosts of this appeal are assessed one-half each to defendants-appellants, Safeway Insurance Company of Louisiana and Clinton P. Desormeaux, and secondary defendant-appellant, State Farm Mutual Automobile Insurance Company.

AFFIRMED IN PART, REVERSED IN PART, AND RENDERED.

      . Ms. Blood later married Mr. Desormeaux; however, they were not married at the time of the accident or at the time she procured insurance for the truck involved in the accident. For the sake of clarity, we will refer to her as Ms. Blood throughout this opinion.

      . § 619. Warranties and misrepresentations in negotiation; applications
      A. Except as provided in Subsection B of this Section and R.S. 22:692, and R.S. 22:692.1, no oral or written misrepresentation or warranty made in the negotiation of an insurance contract, by the insured or in his behalf, shall be deemed material or defeat or void the contract or prevent it attaching, unless the misrepresentation or warranty is made with the intent to deceive.
      B. In any application for life or health and accident insurance made in writing by the insured, all statements therein made by the insured shall, in the absence of fraud, be deemed representations and not warranties. The falsity of any such statement shall not bar the right to recovery under the contract unless such false statement was made with actual intent to deceive or unless it materially affected either the acceptance of the risk or the hazard assumed by the insurer.

      . § 655. Liability policy; insolvency or bankruptcy of insured and inability to effect service of citation or other process; direct action against insurer

      D. It is also the intent of this Section that all liability policies within their terms and limits are executed for the benefit of all injured persons and their survivors or heirs to whom the insured is liable; and, that it is the purpose of all liability policies to give protection and coverage to all insureds, whether they are named insured or additional insureds under the omnibus clause, for any legal liability said insured may have as or for a tort-feasor within the terms and limits of said policy.

      . § 900. "Motor Vehicle Liability Policy” defined

      F. Every motor vehicle liability policy shall be subject to the following provisions which need not be contained therein:
      (1) The liability of the insurance carrier with respect to the insurance required by this Chapter shall become absolute whenever injury or damage covered by said motor vehicle liability policy occurs; said policy may not be cancelled or annulled as to such liability by an agreement between the insurance carrier and the insured after the occurrence of the injury or damage; no statement made by the insured or on his behalf and no violation of said policy shall defeat or void said policy;

      . Art. 2315.4. Additional damages; intoxicated defendant
      In addition to general and special damages, exemplary damages may be awarded upon proof that the injuries on which the action is based were caused by a wanton or reckless disregard for the rights and safety of others by a defendant whose intoxication while operating a motor vehicle was a cause in fact of the resulting injuries.

      . § 900. "Motor Vehicle Liability Policy” defined
      A. A "Motor Vehicle Liability Policy” as said term is used in this Chapter, shall mean an owner's or an operator's policy of liability insurance, certified as provided in R.S. 32:898 or 32:899 as proof of financial responsibility, and issued except as otherwise provided in R.S. 32:899, by an insurance carrier duly authorized to transact business in this state, to or for the benefit of the person named therein as insured.

      . The Safeway policy's exemplary damages exclusion states:
      PART 1 — LIABILITY
      A — Bodily Injury Liability; B — Property Damage Liability.

      Exclusions. This policy does not apply under Part T.

      (o) regardless of any other provision of this policy, this policy does not provide for the payment of punitive or exemplary damages.

        The State Farm policy excludes exemplary damages as follows:
      SECTION III — UNINSURED MOTOR VEHICLE-COVERAGE U, "ECONOMIC-ONLY” UNINSURED MOTOR VEHICLE-COVERAGE UEO AND UNINSURED MOTOR VEHICLE PROPERTY DAMAGES — COVERAGE U1
      UNINSURED MOTOR VEHICLE — COVERAGE U

      We will pay nonpunitive damages for bodily injury an insured is legally entitled to collect from the owner or driver of an uninsured motor vehicle.

      When Coverages U and UEO Do Not Apply THERE IS NO COVERAGE:

      3. FOR PUNITIVE OR EXEMPLARY DAMAGES.

      . § 680. Uninsured motorist coverage
      (l)(a)(i) No automobile liability insurance covering liability arising out of the ownership, maintenance, or use of any motor vehicle shall be delivered or issued for delivery in this state with respect to any motor vehicle designed for use on public highways and required to be registered in this state or as provided in this Section unless coverage is provided therein or supplemental thereto, in not less than the limits of bodily injury liability provided by the policy, under provisions filed with and approved by the commissioner of insurance, for the protection of persons insured thereunder who are legally entitled to recover nonpunitive damages from owners or operators of uninsured or underinsured motor vehicles because of bodily injury, sickness, or disease, including death resulting therefrom; however, the coverage required under this Section is not applicable when any insured named in the policy either rejects coverage, selects lower limits, or selects economic-only coverage, in the manner provided in Item (l)(a)(ii) of this Section. In no event shall the policy limits of an uninsured motorist policy be less than the minimum liability limits required under R.S. 32:900, unless economic-only coverage is selected as authorized herein. Such coverage need not be provided in or supplemental to a renewal, reinstatement, or substitute policy when the named insured has rejected the coverage or selected lower limits in connection with a policy previously issued to him by the same insurer or any of its affiliates. The coverage provided under this Section may exclude coverage for punitive or exemplary damages by the terms of the policy or contract. Insurers may also make available, at a reduced premium, the coverage provided under this Section with an exclusion for all noneconomic loss. This coverage shall be known as "economic-only” uninsured motorist coverage. Noneconomic loss means any loss other than economic loss and includes but is not limited to pain, suffering, inconvenience, mental anguish, and other noneconomic damages otherwise recoverable under the laws of this state.
      (Emphasis added).


source: Caselaw Access Project

author: COOKS, Judge.

license: Public Domain

text:
    Irene PREJEAN v. The ORIGINAL KEVIN GUIDRY PRODUCE MARKET, INC.
    No. 07-138.
    Court of Appeal of Louisiana, Third Circuit.
    Nov. 21, 2007.
    Hawkins & Villemarette, L.L.C., Scott M. Hawkins, Chris Villemarette, Mari-katherine Sonnier, Lafayette, Louisiana, for Plaintiff/Appellant, Irene Prejean.
    Allen & Gooch, (A Law Corporation), John H. Hughes, Lafayette, Louisiana, for Defendant/Appellee, The Original Kevin Guidry Produce Market, Inc.
    Court composed of SYLVIA R. COOKS, OSWALD A. DECUIR, and BILLY H. EZELL, Judges.
   COOKS, Judge.

| STATEMENT OF THE CASE

Bergie Prejean was killed in the parking lot of The Original Kevin Guidry Produce Market (Guidry’s) when an employee of Guidry’s, driving a company refrigerated truck, backed over him. His surviving spouse, Irene, filed an in forma pauperis petition for his wrongful death and a survival claim against Guidry’s. Later, Irene filed an amending petition under the Fair Labor Standards Act alleging, in the alternative, if Bergie was determined to be an employee of Guidry’s, Guidry’s is liable for damages equal to the amount of unpaid wages, overtime wages and appropriate minimum wages as well as penalties and attorney’s fees. Guidry’s filed a motion for summary judgment asserting Bergie was an employee of Guidry’s and not an independent contractor and Irene’s exclusive remedy lies under the workers’ compensation statute. The trial court granted the Defendant’s motion dismissing Plaintiffs claim in tort but reserving the claims under the Fair Labor Standards Act. We have reviewed the record presented on the motion for summary judgment and find, as matter of law, Guidry’s is not entitled to the tort immunity protection afforded under the workers’ compensation statute. Accordingly, we reverse the decision of the trial court granting summary judgment in favor of Guidry’s dismissing Irene’s petition in tort for the death of her husband.

LAW AND DISCUSSION

Guidry’s seeks the immunity from tort liability afforded under the workers’ compensation statute and is alleging there is no material fact in dispute that Bergie was an employee. The evidence submitted by Guidry’s to support its assertion that Bergie was an employee, namely the work schedule, payroll records, insurance records, and tax records, indicates Guidry’s set up an illegal employment relationship lawith Bergie. Guidry’s now seeks to benefit financially from its illegal activities by seeking the tort immunity protection of the workers’ compensation act.

Bergie was seventy-four years old at the time of the accident. He was unable to read or write. His wife, Irene, was disabled and was totally dependent on Bergie for financial and household support. The couple had been married for over fifty years. Prior to his work for Guidry’s, Bergie worked as a deckhand for Lake Charles Dredging and Towing for twenty-five years. He had no retirement and no savings. The record indicates Bergie had been working for the Guidry family for about twelve years. He arrived at work between 4:30 a.m. and 5:00 a.m. and left between 7:00 p.m. and 8:30 p.m. He worked seven days a week. For this Bernie was paid $250.00 in cash every week, less than the minimum wage. Bergie was not paid according to the hours he worked and he was not paid overtime. Bergie used his own vehicle to deliver produce. He paid for the fuel, maintenance and insurance on his own truck. Guidry’s was unable to produce any evidence that Ber-gie was reimbursed for any expenses incurred in connection with his vehicle. Bergie’s truck was titled to him and he had no placard or decal on his truck indicating he was a employee of Guidry’s. Moreover, Bergie was not listed as an authorized driver on any automobile insurance policy Guidry’s maintained on its vehicles. Significantly, on those occasions when Bergie was involved in vehicular accidents, all claims were made on Bergie’s insurance policy and not on Guidry’s insurance policy. The record indicates Guidry’s is never mentioned in the claim records of any of the accidents. Guidry’s clandestine financial scheme allowed it to shield itself from any liability to third parties who were injured while Bergie was engaged in employment activities on behalf of Guidry’s.

Kevin Guidry confirmed Bergie was not listed as an employee of Guidry’s on any financial statement nor did Guidry’s maintain a personnel file on Bergie. Bergie lawas treated as an independent contractor for liability and tax purposes. None of the money Guidry’s paid Bergie was recorded in Guidry’s business records nor was Ber-gie listed as an employee on the payroll records. Guidry’s deducted no taxes from his pay and paid no insurance on him. Guidry’s did not maintain a W-4 form, 941 form or any other document identifying Mr. Prejean as an employee. Guidry’s did not deduct FICA or Social Security taxes from Mr. Prejeans’s wages.

The following testimony occurred at the hearing between the counsel for Irene Pre-jean and Kevin Guidry:

Q: Do you know — oh, for the all the money he was paid, the $250 a week, was it — did he ever — was there a receipt or anything along with that money?
A: No.
Q: Okay. So there’s no record, as far as you can tell us, showing that that cash was paid to Bergie?
A: No. No. I gave it to him.
Q: Is Bergie listed as an employee anywhere in your books?
A: No. He — no. Not — well, he didn’t— you know, I paid him cash. There’s no — -I didn’t have him — there’s no reason to have him anywheres.

It is undisputed Bergie was treated differently from other Guidry’s employees. For example, Jeremy Willingham, the alleged tortfeasor, was paid by payroll check, wore a shirt with Guidry’s logo on it, and was listed as an employee for purposes of workers’ compensation and payroll taxes. Moreover, Guidry’s would deduct taxes from Mr. Willingham’s pay. Guidry’s paid for the gas and maintenance on the truck Willingham drove for Gui-dry’s. Willingham along with other employees, except Bergie, were required to punch a time clock which was then used to calculate the hours worked for payroll purposes.

Guidry’s never paid a premium to his workers’ compensation carrier on the | ¿money he paid to Bergie. However, when Bergie was killed on the premises, Guidry’s informed his workers’ compensation carrier that Mr. Prejean was an employee and paid a small penalty for withholding payments into the system. Additionally, Guidry’s paid back taxes on Bergie. As an explanation for its unusual employment relationship with Bergie, during oral argument counsel for Gui-dry’s explained Bergie was not “just an employee” he was really “like family.” Kevin Guidry referred to Bergie as “Vieux Chien” or “Old Dog,” presumably a term of endearment. Of particular interest is the following exchange between counsel for Bergie and Kevin Guidry which confirms Guidry’s financial arrangement with Bergie is not an isolated incident. There are apparently two other “employees” who are not reported as employees on the financial books of Gui-dry’s:

A: We’re paying back taxes on Vieux Chein (Prejean) and the other two — that the old man and the other two. We have to pay taxes.
Q: Okay. How did that come about?
A: I don’t know. Well, when the accident happened. We had to show that they worked for us.
Q: So—
A: Bergie and the other two guys, we had to show that they worked for us. We had to pay back taxes.

After the fatal accident, Guidry’s now contends Bergie is “just an employee” and it is entitled to the tort immunity provisions of the workers’ compensation statute. Louisiana Revised Statutes 23:1032 is an immunity statute which provides the “rights and remedies herein granted to an employee ... under this Chapter, shall be exclusive of all other rights, remedies, and claims for damages ... including any claims that might arise against his employer.” La.R.S. 23:1032(A)(l)(a) and (b). However, in exchange for tort immunity the employee is guaranteed, in addition to other employee benefits, a no-fault remedy. In O’Regan v. Preferred Enterprises, Inc., 98-1602 (La.3/17/00), 758 So.2d 124, the Louisiana Supreme Court explained the quid pro quo scheme provided by the Act:

The Act was a compromise between labor and industry pursuant to which labors received guaranteed no-fault recovery and industry was relieved of the possibility of large damage awards in the tort system.... This quid pro quo between employers and employees is central to the Act. Thus, it is a fundamental principle that the employee must have the possibility of recovery under the Act for this compromise to hold and for the scope of immunity from tort liability granted by the exclusivity provisions to hold. Barring a tort action without providing a substitute remedy under the Act would abrogate the quid pro quo compromise between the employee and the employer.

Id. at 136.

This quid pro quo bargain is at the heart a “legal employer-employee relationship” which allows an employer tort immunity. Mott v. River Parish Maintenance, 432 So.2d 827 (La.1983), 481 So.2d 1021 (1986) (Dennis, J., dissenting)(emphasis added). In the present case, there is an absence of a legal employer-employee relationship. Guidry’s set up an illegal contractual relationship with Bergie avoiding any responsibility to or for Bergie’s service in connection with its business operations. This court in the past has not allowed an employer to benefit from an illegal contract of employment.

In Ewert v. Georgia Casualty & Surety Co., 548 So.2d 358 (La.App. 3 Cir.1989), writ denied, 551 So.2d 1339 (La.1989), a mother brought a tort action on behalf of her minor son who was injured while performing logging operations. The employer hired a minor in a logging business in violation of the child labor laws and was seeking tort immunity when the minor was injured on the job. This court held an employer may not benefit financially from an illegal contract of employment and allowed the minor a remedy in tort. The court stated:

A rule which allows the employer of an illegally employed minor to interpose the exclusive remedy defense to a tort suit is the very opposite of the principles announced in the above civil code articles. It | allows the employer to benefit from a contract that has been legislatively condemned. It allows the policy of the workers’ compensation immunity provisions to triumph totally over the policy of the Child Labor Laws.

Id. at 362.

While Ewert involved a violation of the child labor laws, Louisiana has numerous other public policy statutes which specifically prohibit the type of employment relationship Guidry’s had with Bergie. The Fair Labor Standards Act requires Gui-dry’s to pay a minimum wage to all full-time employees, a mandate Guidry’s failed to follow. Employers are required under federal law to withhold Social Security and FICA on all employees. Again, Guidry’s violated this provision. Louisiana unemployment and workers’ compensation statutes require employers to pay into the system. The record indicates Guidry’s never contributed a dime into either the unemployment or the workers’ compensation system on behalf of Bergie. Moreover, Guidry’s treatment of Bergie is not an isolated incident, but rather a pattern of deceptive behavior. There are two other employees working for Guidry’s who are not reported anywhere on Guidry’s financial records.

Guidry’s illegal employment relationship with Bergie, and two other employees, harms not only Bergie but third parties as well. The record indicates Bergie was |7involved in three vehicular accidents while in the course and scope of his “relationship” with Guidry’s, delivering produce when these accidents occurred. Yet the victims made no claim against Guidry’s because Bergie’s truck was titled to him and there was no logo or decal identifying him as a delivery driver for Guidry’s. Further, Bergie carried his own insurance and was not listed as a covered driver on Guidry’s automobile insurance carrier.

While Guidry’s admits it purchased the trucks for Bergie, it attempts to excuse its failure to list Bergie on its insurance by asserting Bergie used the truck for his own personal use. Guidry’s employment arrangement allowed it to shield its identity from third parties and thereby escape any financial responsibility for the torts committed while Bergie was engaged in the scope of his “relationship” delivering produce for Guidry’s. Guidry’s now wishes to pay a meager $250 fíne and de minimis “back taxes” for alleged wages, well below the minimum pay scale, in exchange for complete protection and immunity from its tort liability for the death of Bergie. Had this tragic event not occurred and Guidry’s liability insurance carrier was not facing full exposure for Bergie’s death, there is nothing in the record to suggest Guidry’s would voluntarily “come clean” and attempt to accept responsibility, willingly shared by other conscientious employers doing business in the state who “pay their fair share” for the bargain they received under the workers’ compensation statute. To allow Gui-dry’s to change Bergie’s status after his death to justify its interest, and none other, would circumvent the policy considerations behind the enactment of Louisiana’s public policy statutes including the workers’ compensation act. We cannot allow an employer to benefit from his illegal activity. Guidry’s violations in this case are not the result of oversight or ignorance, but rather, the record suggests, a deliberate pattern |sof behavior on the part of Guidry’s specifically designed to avoid its full responsibility toward it employees and the public at large. Our holding is limited to the egregious facts presented before us and is in keeping with Louisiana’s public policy laws. We find, as a matter of law, Guidry’s is not entitled to the tort immunity protection afforded under the workers’ compensation statute. Accordingly, we reverse the decision of the trial court granting Guidry’s motion for summary judgment dismissing Irene Prejean’s tort actions.

DECREE

Based on the foregoing review of the record, we reverse the decision of the trial court granting Guidry’s motion for summary judgment. All costs of this appeal are assessed to The Original Kevin Guidry Produce Market, Inc.

REVERSED.

      . The amounts due under the workers’ compensation system for the injury or death of an employee are fixed in advance and are not subject to negotiation. In this case, because Guidry’s operated totally outside of the workers’ compensation system, a correct calculation of Bergie's wages and benefits, and therefore the sum owed to his surviving spouse, is not provable by properly maintained records. It appears from the deposition testimony, Gui-dry’s was attempting to negotiate a settlement with Bergie's widow. The following exchange occurred between counsel for Gui-dry’s and Irene Prejean:
      Q: If the workers’ compensation insurance company said, “We will pay you $100.00 a week instead of $50.00”, would that be enough?
      A: I don’t know.
      Q: I think because a minute ago you told me that you thought $50.00 a week wasn’t—
      A: It wasn’t enough.
      Q: —sufficient.
      A: Yes
      Q: But you did admit—
      A: I would have to think about it. I mean, I don't know.
      Q: But you did admit that $50.00 was better than nothing, though, right?

      . Bergie had the minimum insurance coverage allowed by law on his truck.


author: GLENN B. GREMILLION, Judge.

text:
    Frances CARRON v. CITY OF OPELOUSAS.
    No. 07-506.
    Court of Appeal of Louisiana, Third Circuit.
    Nov. 21, 2007.
    Rehearing Denied Dec. 28, 2007.
    Daniel M. Landry, III, Lafayette, LA, for Plaintiff/Appellee, Frances Carrón.
    G. Douglas Dean, Dean Law Offices, Opelousas, LA, for Defendant/Appellee, Opelousas Municipal Civil Service Commission.
    Frank P. Trosclair, Jr., Taylor and Tros-clair, Pride Justin Doran, Williams & Do-ran, PLLC, Opelousas, LA, for Defendant/Appellant, City of Opelousas, LA.
    Court composed of JIMMIE C. PETERS, GLENN B. GREMILLION, and J. DAVID PAINTER, Judges.
   GLENN B. GREMILLION, Judge.

hln this case, the defendant, the City of Opelousas (City), appeals from the finding of the Opelousas Municipal Civil Service Board (Board) in favor of the plaintiff, Frances Carrón. For the following reasons, we reverse.

FACTUAL AND PROCEDURAL BACKGROUND

Carrón was appointed as the City Clerk and Tax Collector for the City of Opelou-sas in 1988. On January 9, 2007, after being advised that she would not be reappointed to her position, Carrón announced that she would be retiring at the end of the month. However, on January 11, 2007, Carrón sent a letter to the Mayor advising him that she had changed her mind about retiring and that she would not voluntarily terminate her position with the City. Carrón, thereafter, received a letter on January 25, 2007, which was dated January 24, 2007, from the Mayor reconfirming the fact that a new person had been appointed as City Clerk and Tax Collector, and that effective February 1, 2007, she would no longer be on the City’s payroll.

Carrón appealed the action of the City to the Board via a letter dated February 1, 2007. The City filed an exception to jurisdiction and a motion to dismiss her appeal. Following a March 12, 2007 hearing, the Board rendered a decision denying the exception to jurisdiction and motion to dismiss. The Board declared that Carron’s resignation was not made in accordance with civil service rules, thereby giving her standing to bring an appeal. The Board further found that Carrón was a Incivil service employee based on Opelousas Ordinance 11 of 1962. It further ordered the reinstatement of Carrón to the office of City Clerk and Tax Collector and removed from that position, the new appointee, Karen Frank. The City now appeals.

The City assigns as error, the Board’s decisions that:

1. Carrón held a classified position under the municipal civil service and was, therefore, entitled to the protections afforded by municipal civil service law.
2. Carrón had standing to appeal to the Board and that the Board had jurisdiction to decide the validity of the appointment of Frank and the removal of Car-ron.
3. The Mayor, with the confirmation of the Board of Aldermen, does not have the authority to appoint, nominate, and select Frank as City Clerk and Tax Collector for the City in the absence of cause or misconduct of Carrón, under municipal service laws and regulations.
4. The appointment and term of office of Carrón did not expire and terminate at the time of the first regular meeting of the Board of Aldermen succeeding each regular municipal election.
5. The Mayor, subject to confirmation by the Board of Aldermen, is not required by law to appoint a Clerk and Tax Collector at the first regular meeting of the Board of Aldermen succeeding each regular municipal election.
6. The appointment of Frank did not constitute and have the effect of removing and terminating Carrón from that office.
7. Alternatively, that Carrón did not quit or resign the office of City Clerk and Tax Collector.
8. Alternatively, that any appeal of Carrón to the Board was not barred by or prescribed by the lapse of more than fifteen days.
9. Carrón be reinstated to the office of City Clerk and Tax Collector with back pay.
10. The City rescind and void its appointment of Frank to the office of City Clerk and Tax Collector.

LAWRASON ACT

The City of Opelousas is a Lawrason Act municipality governed by the provisions of La.R.S. 33:321 et seq. The mayor is the chief executive officer of the |smunicipality. La.R.S. 33:362(B). Louisiana Revised Statute 33:381, titled “Municipal Officers,” states that “[t]he officers of every municipality shall be a mayor, aldermen, a chief of police, a tax collector, and a clerk.” La.R.S. 33:381(A). Louisiana Revised Statute 33:383 addresses municipal elections and terms of office. In accordance with that article, the City of Opelousas adopted, by ordinance, a plan that had municipal elections follow the time schedule of congressional elections such that elected officers take office on the first day of January following the election, with a term of office lasting four years. Louisiana Revised Statute 33:386 addresses the appointment of “municipal officials,” and states that:

A. At the first regular meeting of the board of aldermen succeeding each regular municipal election, the mayor, subject to confirmation by the board of aldermen, shall appoint a clerk, tax collector, except as provided for in R.S. 33:381(D), and all other necessary officers whose election is not provided for in R.S. 33:381.
D. The term of the clerk, tax collector ... shall end at the time of the first regular meeting of the board of aider-men succeeding each regular municipal election.

The duties of the clerk and tax collector are, thereafter, described by statute. See La.R.S. 33:421, 424.

CIVIL SERVICE EMPLOYEE

Following a special election held on August 12, 1961, Opelousas Ordinance Nos. 10 and 11 declared that the civil service system would be effective in the City of Opelousas on May 1, 1962. The specific polling language asked:

Shall the employees and officers of the City of Opelousas, Louisiana, with the exception of those coming under the provisions of Article 14, Section 15.1 of the Louisiana Constitution of 1921, as amended, who have acquired civil service status by legislative act, city charter or otherwise, be subject to and governed by a civil service system based on merit, as provided for in Article 14, Section 15 of the Louisiana Constitution of 1921 as amended?

Ordinance 11 of 1962, Section 9, states (emphasis added):

|4That Municipal Civil Service for the municipal employees included thereunder shall become effective as of May 1, 1962, including the heads of the various departments, inspectors, curators, or custodians of parks or museums, whose salaries or wages are paid solely by the City of Opelousas on a regular wage or salary basis, or out of funds collected or derived from inspections and permits by the various city inspectors. The classified service shall not include the position of City Attorney, City Engineer, City Auditor, the members of any municipal boards or commissions, any elected officials, or any other positions excluded from the classified service by Article 14, Section 15(G)-(a) of the Louisiana Constitution of 1921, which are not specifically included in the classified service by the provisions of this section.

Both the 1921 and 1974 Louisiana Constitutions addressed those employees who are considered classified. Article 10 of the 1974 Louisiana Constitution governs public employees and officials. Article 10, § 1, addresses state and city civil service, and states (emphasis added):

IsSection 1. (A) State Civil Service. The state civil service is established and includes all persons holding offices and positions of trust or employment in the employ of the state, or any instrumentality thereof, and any joint state and federal agency, joint state and parochial agency, or joint state and municipal agency, regardless of the source of the funds used to pay for such employment. It shall not include members of the state police service as provided in Part IV of this Article or persons holding offices and positions of any municipal board of health or local governmental subdivision. (B) City Civil Service. The city civil service is established and includes all persons holding offices and position of trust or employment in the employ of each city having over four hundred thousand population and in every instrumentality thereof. However, paid firemen and municipal policemen may be excluded if a majority of the electors in the affected city voting at an election held for that purpose approve their exclusion. The election shall be called by the municipal governing authority within one year after the effective date of this constitution.

Article 10, § 2 of the 1974 Constitution addresses classified and unclassified service, and states in part (emphasis added):

Section 2. (A) Classified Service. The state and city civil service is divided into the unclassified and classified service. Persons not included in the unclassified service are in the classified service.
(B) Unclassified Service. The unclassified service shall include the following officers and employees in the state and city civil service:
(1) elected officials and persons appointed to fill vacancies in elective offices;
(2) the heads of each principal executive department appointed by the governor, the mayor, or the governing authority of a city[J

Further, La.R.S. 33:2585 states (emphasis added):

A. The governing authority of any parish or municipality is hereby authorized to enact ordinances, by majority vote, permitting the inclusion, in any civil service system created by the governing authority of the parish or municipality, of any employees of any board, commission, or other local agency or special district created by or appointed by the governing authority of the parish or municipality, [^except those officials and employees who are prohibited from being included in the local civil service by the provisions of Article X, Section 15 of the Louisiana Constitution, and particularly the second paragraph thereof.

Louisiana Constitution Article 14, § 14 of the 1974 Constitution provides transitional provisions, but the transitional provisions shall not “be construed or applied in such a manner as to supersede or invalidate, or limit or change the meaning of any provision of the foregoing Articles of this constitution, but only to provide an orderly transition from the Constitution of 1921.” Louisiana Constitution Article 14, § 9 states:

Upon the effective date of this constitution, all officers and employees of the state and of the cities covered hereunder who have status in the classified service shall retain said status in the position, class, and rank that they have on such date and shall thereafter be subject to and governed by the provisions of this constitution and the rules and regulations adopted under the authority hereof.

Additionally, La. Const, art. 10, § 15 allows city civil service systems to include some persons normally considered unclassified in the classified system. However, it specifically goes on to state:

Nothing in this Part shall permit inclusion in the local civil service of officials and employees listed in Section 2 of this Article.
No law enacted after the effective date of this constitution establishing a civil service system applicable to one or more parishes or to one or more municipalities having a population less than four hundred thousand shall be effective in any parish or in any municipality until approved by ordinance adopted by the governing authority of the parish or municipality.

Article 14, § 16 provides a list of provisions in the 1921 constitution to be continued as statutes except if they conflict with the 1974 constitution; the former Article 14, § 15 is not included in that list.

The 1974 Constitution superceded and replaced the 1921 Constitution. La. Const, art. 14, § 18. The transitional clause in the 1974 Constitution provides that city civil service employees shall retain the classified status that they had and, | thereafter, be subject to the provisions of the 1974 Constitution. However, there are no provisions that retain civil services boards formed under the 1921 Constitution. Quite to the contrary, Article 14, § 16 does not retain the provisions of the old constitution relative to local city civil service boards. Additionally, Article 14 § 18(B)specifically states that “[flaws which are in conflict with this constitution shall cease upon its effective date.”

Based on the explicit provisions of the 1974 Constitution, we are compelled to find that Carrón was not a classified civil service employee. We note that it is clear from the record that Carron’s position was, in fact, considered classified by the municipal civil service commission. She took a civil service exam and was appointed to her position via a letter from the Opelousas Municipal Civil Service Commission on April 13, 1988. That letter notes a six-month probationary period in which she could be discharged without the right of an appeal, but goes on to state:

Upon completion of your working test, your appointing authority shall so advise the board and furnish a signed statement to you of your acceptance as a permanent employee in this position.

There was further documentation relating to Carron’s position, such as pay raises and revised job descriptions, all of which was authored by the municipal civil service commission. Further, in the Opelousas Municipal Civil Service Rules and Regulations, effective in 1962, the City Clerk and Tax Collector, is specifically listed under a section called “class titles” which assigns ranges in order to determine pay rate.

However, it is also clear that her position was considered to be a “municipal officer.” In a 1999 resolution, the Board of Aldermen resolved to appoint municipal officer, Carrón, to a term of four years. Various other resolutions reappointing Carrón refer to her position as one of being a municipal officer.

| ^Nevertheless, the provisions of the 1974 Constitution clearly exclude Carron’s position from civil service classification, as she is the head of a principal executive department appointed by the mayor of the city. See La. Const. Art. 10 § 2(B)(2) and Article 15. The 1974 Constitution super-cedes the 1921 Constitution, and the City cannot elect to continue to be governed by the latter merely because it has been customary for it to do so. Accordingly, we find that the Civil Service erred in finding that she was a protected municipal civil service employee.

Next, we will address the case of Eubanks v. City of Opelousas, 590 So.2d 740 (La.App. 3 Cir.1991), which Carrón and the Board rely heavily upon in buttressing their argument that she is a protected employee under the civil service system. In Eubanks, a city employee, the street commissioner, was terminated from employment when the position of street commissioner was abolished. An exception of prescription was filed by the City because the employee did not timely appeal his termination to the City Civil Service Commission. In their discussion of the prescriptive issue, a panel of this court wrote:

Plaintiff does not contest the fact that he is a classified City employee. Under Section 10 of Ordinance No. 11 of 1962 of the City of Opelousas, “(classified employees) shall be governed by the provisions of Article 14, Section 15 of the Louisiana Constitution, and rules and regulations adopted under such authority.” La. Const.1921, Article 14, Section 15(0)(1), which was in effect when City Ordinance 11 of 1962 was enacted, stated, “There is vested in the State Civil Sendee Commissioner and in the appropriate Civil Service Commissions for the several cities respectively the exclusive right to hear and decide all appeals and the legality of all removal and disciplinary cases ... ”.
Under the authority of La. Const. 1921, Article 14, Section 15, which was then in effect, the City Civil Service Commission enacted Rule 11, Section 4.4 which states, “Appeals to the Board shall be filed within fifteen (15) days of the action or actions taken against the employee by the appointing authority.” La. Const.1974, Article 10, Section 12, which was in effect when the action plaintiff contests occurred in 1987, also provides that, “Each commission shall have the exclusive power and authority to hear and decide all removal and disciplinary cases, ... ”.

Uld. at 743-44.

We find that the reliance by our court on the 1921 Constitution was incorrect, however, we agree with the result reached in that opinion. A classified employee is required to timely appeal her termination to the civil service board and failure to do so could be successfully met with an exception of prescription.

We further find that, pursuant to Lawrason Act provisions, Carron’s appointments were for four year terms. As is customary in the political climate of this state’s cities and towns, the new mayor could and did appoint a new city clerk and tax collector, namely Karen Frank. Accordingly, we find the commission erred in reinstating Carron’s position.

CONCLUSION

The judgment of the trial court finding that Carrón was a classified employee is, hereby, reversed and her reinstatement to her position as City Clerk and Tax Collector is revoked.

Thus, appeal to the District Court and/or this Court was proper in these instances. All costs of this appeal are assessed against the plaintiff, Frances Car-ron.

REVERSED.

      . This case is consolidated with City of Opelousas v. Opelousas Municipal Civil Service Commission, 07-684 (La.App. 3 Cr. 11/21/07), 970 So.2d 1211, 2007 WL 4122900. Both cases center around the same issue of whether certain city employees, i.e., "executive department heads,” are classified employees under the Opelousas municipal civil service system. In this case, the trial court denied the defendant Commission's exception of res judicata, granted various parties’ exceptions of lack of subject matter jurisdiction and no cause of action, and dismissed the City’s petition for issuance of a temporary restraining order, preliminary and permanent injunction, and for declaratory judgment. The trial court did not address the underlying issue, but found that the Commission had exclusive jurisdiction to decide the issue. The City's appeal followed.

      . It is clear that under the 1921 Constitution, Carrón would not have been a classified employee, but for the City enacting a provision specifically including all regular employees and "the heads of various departments.” Article XIV, § 15(G)(a)(2) of the 1921 Constitution stated that the unclassified city service shall include the “heads of principal departments appointed by the ... Mayor or other governing body of any city.”

      . We note that the record does not reflect whether the civil service commission was validly created following the adoption of the 1974 constitution, which requires that a majority of electors adopt the civil service provisions found in Louisiana Constitution Article 10, § 14, which apply to those cities having fewer than 400,000 in population. However, this issue was not raised on appeal and we will not address it.
      Louisiana Constitution Article 10, § 14 addresses those cities having fewer than 400,000 in population, and states (emphasis added):
      Section 2. (A) Local Option. Each city having a population exceeding ten thousand but not exceeding four hundred thousand, each parish, and each parish governed jointly with one or more cities under a plan of government, having a population exceeding ten thousand, according to the latest official decennial federal census, may elect to be governed by this Part by a majority vote of its electors voting at an election held for that purpose. The election shall be ordered and held by the city, the parish, or the city-parish, as the case may be, upon (a) the adoption of an ordinance by the governing authority calling the election; or (b) the presentation to the governing authority of a petition calling for such an election signed by the electors equal in number to five percent of the registered voters of the city, the parish, or the city-parish, as the case may be.

      (B) Acceptance. If a majority of the electors vote to adopt this Part, its provisions shall apply permanently to the city, the parish or the city-parish as the case may be, and shall govern it as if this Part had originally applied to it. In such case, all officers and employees of the city, the parish, or the city-parish, as the case may be, who have acquired civil service status under a civil service system established by legislative act, city charter, or otherwise, shall retain that status and thereafter shall be subject to and be governed by this Part and the rules and regulations adopted under it.
      (C) Rejection. If a majority of the electors vote against the adoption of this Part, the question of its adoption shall not be resubmitted to the voters of the political subdivision within one year thereafter.

      . Assignments of error numbers 2, 7, and 8 rendered moot by our previous findings and are not addressed here.


text:
    CITY OF OPELOUSAS v. OPELOUSAS MUNICIPAL CIVIL SERVICE COMMISSION, et al.
    No. 07-684.
    Court of Appeal of Louisiana, Third Circuit.
    Nov. 21, 2007.
    Rehearing Denied Dec. 28, 2007.

      Pride J. Doran, Williams & Doran, PLLC, Lafayette, LA, for Plaintiff/Appellant, City of Opelousas.
    Philip E. Roberts, Roy, Bivins, Judice, Roberts & Wartelle, APLC, Lafayette, LA, for Defendant/Appellee, Ron Turner, Margaret Doucet, Ken Vidrine.
    G. Douglas Dean, Dean Law Offices, Opelousas, LA, for Defendant/Appellee, Opelousas Municipal Civil Service Commission.
    Daniel M. Landry, III, Lafayette, LA, for Defendant/Appellee, Frances Carrón.
    Barbara W. Thomas, Civil Service Director, Opelousas, LA.
    Court composed of JIMMIE C. PETERS, GLENN B. GREMILLION, and J. DAVID PAINTER, Judges.
   GLENN B. GREMILLION, Judge.

12This appeal is consolidated with Carron v. City of Opelousas, 07-506 (La.App. 3 Cir. 11/21/07), 970 So.2d 1205, 2007 WL 4119180. In the instant case, City of Opelousas v. Opelousas Municipal Civil Service Commission, Frances Carron, Ron Turner, Margaret Doucet, Ken Vidrine, and Barbara Thomas, the City of Opelou-sas filed a Petition for issuance of temporary restraining order, preliminary and permanent injunction, and for declaratory judgment. The City requested that a TRO be ordered to halt the scheduled hearing of the Opelousas Civil Service Commission regarding Carron’s appeal. The trial court denied the TRO and the Commission convened and reinstated Car-ron’s employment. Carrón and other city employees filed exceptions of lack of subject matter jurisdiction, no cause of action, and res judicata urging that the District Court did not have jurisdiction to proceed regarding the declaratory judgment, and preliminary and permanent injunctions. The trial granted the defendants’ exceptions because it found that it did not have jurisdiction over the matter. The City now appeals.

This day we have rendered a decision in the Carrón case. Based on that decision, for the reasons set forth therein, we reverse the trial court and remand for proceedings consistent with that decision.

REVERSED AND REMANDED.

      . The other employees include Ron Turner, Margaret Doucet, Ken Vidrine, and Barbara Thomas.


author: SYLVIA R. COOKS, Judge.

text:
    Rayeanne OWENS and Rene Owens v. ENTERGY CORPORATION, City of Broussard and Kathy Lowes.
    No. 07-616.
    Court of Appeal of Louisiana, Third Circuit.
    Nov. 21, 2007.
    Rehearing Denied Dec. 28, 2007.

      Louis R. Koerner, Jr., Koerner Law Firm, Houma, LA, Kenneth W. Jacques, Law Offices of Kenneth W. Jacques, New Orleans, LA, for Plaintiff/Appellant, Rene Owens.
    George J. Armbruster, III, The Pana-giotis Firm, Lafayette, LA, for Plaintiff/Appellant, Rayeanne Owens.
    Thomas R. Hightower, Jr., Wade Kee, A Professional Law Corporation, Lafayette, LA, for Defendants/Appellees, Shelter Mutual Insurance Company and Cathy Lyles, as owner of and as pertains to 110 Brown-lee Avenue.
    John W. Penny, Jr., Penny & Hardy, Lafayette, LA, for Defendants, Cathy Lyles and Allstate Insurance Company.
    Joseph R. Ballard, John A. Braymer, Baton Rouge, LA, for Defendant, Entergy Gulf States, Inc.
    Donald D. Landry, Perrin, Landry, de-Launay, Dartez & Ouellet, Lafayette, LA, for Defendant, City of Broussard.
    Paul F. Baker, Law Offices of Keith S. Giardina, Baton Rouge, LA, for Defendant, Robert Broussard.
    Court composed of Chief Judge Ulysses Gene Thibodeaux, Sylvia R. Cooks, and Billy H. Ezell, Judges.
   SYLVIA R. COOKS, Judge.

•I STATEMENT OF THE CASE

Rene and Rayeanne Owen appeal the judgment of the trial court granting Cathy Lyles’ and Shelter Mutual Insurance Company’s motion for summary judgment. For the reasons assigned below, we reverse the judgment of the trial court.

STATEMENT OF THE FACTS

Cathy Lyles is the owner of two rental houses on Brownlee Avenue, Broussard, Louisiana, which are adjacent to one another. The house at 110 Brownlee was leased to Robert Broussard and insured by Shelter Mutual Insurance Company. The written lease between Mr. Broussard and Ms. Lyles provided the lessee assumed liability for injury caused by any defect in the leased premises under La.R.S. 9:3221. The other residence at 108 Brownlee was leased to Rene and Rayeanne Owens and insured by Allstate Insurance Company. There was no written lease between Ms. Lyles and the Owens.

Sometime around June 4, 2003, Mr. Broussard discovered a large hole in the grassy area which forms the boundary between the two lots. The hole was apparently formed when a sewer pipe burst underneath an Entergy utility box. The leaking water caused erosion in the area, and the utility box was broken and leaning over. When Mr. Broussard looked into the hole he could see exposed wires on the utility pedestal. He described the hole as being twelve to fifteen inches in diameter and over two feet deep. He called and reported the problem to Entergy on two occasions, and he attempted to remove the grass, which had grown over the hole, to expose the hole to view and minimize the danger to others in the neighborhood. Eventually, the leaky pipe was replaced by the City of Broussard and Entergy repaired the broken utility box. However, prior to the repair, on June 23, 2003, while cutting his grass Rene 12Owens fell into the hole injuring his back, leg and knee.

Mr. Owens, and his wife, Rayeanne, sued Entergy, the City of Broussard, Cathy Lyles and her insurers, Allstate and Shelter for injuries. The Owens amended their petition to name Robert Broussard and his insurer, Liberty Mutual Insurance Company, as defendants, based upon Mr. Broussard’s responsibility to maintain the premises under the lease.

Shelter filed a motion for summary judgment alleging there is no dispute that Ms. Lyles was unaware of the existence of the hole on or near the 110 Brownlee property. Absent knowledge of the potential danger created by the hole, as owner of 110 Brownlee, Ms. Lyles owed no duty to warn Rene Owens of its existence and no liability for injuries sustained. Ms. Lyles relied on La.Civ.Code art. 2317.1. Additionally, Shelter asserted Ms. Lyles, as lessor of 110 Brownlee, was absolved of any responsibility for the condition of the property because the lease agreement on 110 Brownlee places the liability on Mr. Broussard. Ms. Lyles relied on La.R.S. 9:3221. The trial court agreed with Shelter and granted the motion for summary judgment dismissing Ms. Lyles as owner of 110 Brownlee and her insurer, Shelter. The trial court maintained the claim against Ms. Lyles, as owner/lessor of 108 Brownlee, and her insurer, Allstate.

The Owens appeal asserting the trial court erred because there are disputed issues of material fact as to the location of the hole, and under La.Civ.Code art. 2695, Ms. Lyles, as lessor, has a responsibility to remedy any unreasonably dangerous condition on the premises leased to and/or commonly used by the Owens. Further, the Owens assert the trial court erred in finding as a matter of law Ms. Lyles was absolved of all liability based on the terms of the lease with Mr. Brousssard. We agree and reverse the judgment of the trial court granting summary judgment in favor |sof Shelter and Ms. Lyles as owner of 110 Brownlee.

LAW AND DISCUSSION

Ms. Lyles, as lessor, is responsible under La.Civ.Code art. 2695 for any unreasonably dangerous condition on the leased premises. At the time of the accident, La.Civ.Code art. 2695 provided as follows:

The lessor guarantees the lessee against all the vices and defects of the thing, which may prevent its being used even in case it should appear he knew nothing of the existence of such vices and defects, at the time the lease was made, and even if they have arisen since, provided they do not arise from the fault of the lessee; and if any loss should result to the lessee from the vices and defects, the lessor shall be bound to indemnify him for the same.

Ms. Lyles and Shelter assert because the hole is not located on the premises leased to the Owens, but on property leased to Mr. Broussard, Ms. Lyles has no liability for injury to Mr. Owens under this provision. We find there is a serious factual dispute as to the location of the hole and the use of the property by each of the tenants. In fact, a survey and inspection of the area of the hole indicated that a portion of the hole was located on 110 Brownlee and a portion was on 108 Brown-lee. The testimony of both Mr. Broussard and the Owens confirm that the land area between 108 and 110 Brownlee was not clearly attributed by use to either lessee and both parties cut the grass and used the common area. Ms. Lyles testified her belief was that the box was “right in the center” of the common area between the two properties. We find the trial court erred in finding no dispute that the hole was located entirely on the premises of 110 Brownlee.

Shelter and Ms. Lyles assert, as a matter of law, if the hole is located on 110 Brownlee, Mr. Broussard, as lessee, not Ms. Lyles, is responsible for any defect in the property and is liable for injury to individuals using the common area. Shelter and Ms. Lyles relies on the following lease provision:

|4The provisions of La.R.S. 9:3221 shall apply to this lease. Accordingly, lessee assumes responsibility for this condition of the leased premises and Lessor shall not be liable for injury caused by any defect in the leased premises to the lessee or anyone on the premises who derives his right from the lessee, unless Lessor knew or should have known of the defect or had received notice thereof and failed to remedy it within a reasonable time.

However, in order to shift liability to the lessee for property defects, the parties must clearly agree to the transfer of liability. See McKnight v. McCastle, 04-2437 (La.App. 1 Cir. 12/22/05), 928 So.2d 45, writ denied, 06-205 (La.4/24/06), 926 So.2d 548. Although the statutory warranty against vices and defects may be dispensed with as a condition of a lease and are not against public policy, to be effective, such waiver must be written in clear and unambiguous terms, contained in a written contract and brought to the attention of the lessee or explained to him. Walnut Equipment Leasing Co., Inc. v. Moreno, 26,004 (La.App. 2 Cir. 9/21/94), 643 So.2d 327; Smith v. Kaye’s Food Market, 38,518 (La.App. 2 Cir. 5/19/04), 874 So.2d 395, writ denied, 04-1560, 04-1498 (La.10/1/04), 883 So.2d 992, 1008. In the present case, there was no evidence presented that Mr. Broussard was fully aware when he signed the residential lease that he was assuming all liability for injury to his neighbor caused by a condition in the common area. We find the trial court erred in finding, as a matter of law, Ms. Lyles and Shelter, is absolved of all potential responsibility to the Owens based on the terms of the lease with Mr. Broussard on 110 Brownlee. Accordingly, we reverse the decision of the trial court granting the summary judgment dismissing Ms. Lyles, as to 110 Brownlee, and her insurer, Shelter Mutual Insurance Company.

DECREE

Based on the foregoing review of the record, we reverse the judgment of the trial court granting summary judgment in favor of Cathy Lyles, as to 110 Brownlee, | Band her insurer, Shelter Mutual Insurance Company. All costs of this appeal are assessed to Shelter Mutual Insurance Company and Cathy Lyles.

REVERSED.