text:
    Collette DWYER v. WEST FELICIANA FIRE PROTECTION DISTRICT #1 CIVIL SERVICE BOARD.
    No. 2011 CW 1096.
    Court of Appeal of Louisiana, First Circuit.
    Dec. 21, 2011.

      Henry D.H. Olinde, Jr., Scott E. Mercer, Baton Rouge, LA, Samuel C. D’Aquil-la, St. Francisville, LA, for Defendant-Appellee, West Feliciana Fire Protection District # 1.
    Charles L. Dirks, III, Baton Rouge, LA, for Plaintiff-Appellant, Collette Dwyer.
    Before CARTER, C.J., PARRO, and HIGGINBOTHAM, JJ.
   HIGGINBOTHAM, J.

|2Plaintiff, Collette Dwyer, appeals a district court judgment that upheld the abol-ishment of her classified position of firefighter/operator by defendant, the West Feliciana Fire Protection District No. 1 (“the FPD”). After reviewing the facts and applicable law, we convert the appeal to an application for supervisory - writs, grant the request for supervisory review of the merits, and affirm the district court’s judgment.

BACKGROUND

The FPD hired Collette Dwyer as a full-time employee in September 1999, to perform administrative duties in an entry-level classified position of secretary to the fire chief. In May 2000, Dwyer changed to another entry-level classified position with the FPD, when she became a firefighter/operator. She remained in that position, performing both administrative duties (but not data-entry duties, which were performed by a non-classified employee) and firefighter/operator duties until January 11, 2010. Dwyer was the only classified firefighter/operator employed by the FPD on January 11, 2010.

At a regularly-scheduled meeting on that same date, the Board of Commissioners of the FPD (“the FPD Board”) unanimously voted to allow the meeting agenda to be amended in order to consider the recommendation of the personnel committee of the FPD Board. The FPD Board then voted to follow the recommendation to reorganize the FPD’s structure for economic reasons and in consideration of volunteer manpower shortages. The reorganization of the FPD resulted in the elimination of the classified firefighter/operator position, as well as | oseveral unclassified volunteer and contract positions. On January 12, 2010, Dwyer was notified in writing that she was being laid off as a result of the abolishment of the classified firefighter/operator position and that the only remaining classified positions at the FPD were fire chief and data processor. Consequently, Dwyer was placed on a reemployment list for four years in accordance with La. R.S. §3:2551.

Dwyer timely filed an appeal of the FPD Board’s action with the three-member Civil Service Board for the FPD (“the CS Board”). Because Dwyer was a member of the CS Board, it was necessary that she be recused from participating as a board member in her appeal to the CS Board. In her appeal, Dwyer alleged that because of her seniority with the FPD and her previous performance of administrative duties while she was a firefighter/operator, she was entitled to be reassigned to the next lowest classified position as a data processor at the FPD.

The CS Board held a public hearing on February 11, 2010, with the two remaining members. The attorneys for Dwyer and the FPD submitted the case for decision by the CS Board based on stipulations that were read into the record. In a decision rendered on March 19, 2010, one CS Board member voted to reinstate Dwyer to her firefighter/operator position in light of Dwyer’s mistaken reliance on the FPD Board’s invalid characterization of the data processor position as classified and the fact that the posted agenda for the FPD Board’s regularly-scheduled meeting did not reference the abolishment of the firefighter/operator position. The other CS Board member voted to deny Dwyer’s appeal, concluding that the only issue before the CS Board was whether Dwyer was legally entitled to the unclassified data processor position, and further determining that Dwyer was only entitled to placement on the re-employment list, since there was no other classified position in the respective class of firefighter/operator that she could be legally transferred into that shared the same essential duties and responsibilities as |4the firefighter/operator position. Because there was no concurrence between the two voting CS Board members, the action of the FPD Board in abolishing Dwyer’s classified position was deemed affirmed by the CS Board in accordance with La. R.S. 33:2561(D).

After the CS Board rendered its decision, effectively affirming the FPD Board’s action, Dwyer gave notice that she intended to appeal the CS Board’s decision to the district court. She timely filed a petition for judicial review, arguing that the FPD Board failed to comply with the provisions of the Open Meetings Law and civil service laws when her classified position was abolished and she was laid off from her position. After reviewing the record and hearing the arguments of counsel, the district court affirmed the decision of the CS Board on February 25, 2011. In oral reasons for judgment, the district court concluded that the CS Bd. acted in good faith and for cause when, for purely economic reasons, the classified position of firefighter/operator was abolished according to the personnel committee’s restructuring proposal. The district court further found that |ñDwyer was laid off from work at the FPD, since there was no other classified position in her class to which she could be transferred. Dwyer timely appealed to this court, raising one assignment of error, contending that the district court legally erred in failing to conclude that Dwyer should be placed in the next lower classified position of data entry processor with the FPD.

ANALYSIS

As a classified civil service employee who felt her discharge was not for just cause, Dwyer had the right to demand a hearing and investigation by the CS Board to determine the reasonableness of the FPD Board’s action in abolishing her classified position and not placing her in the next lower classified position of data entry processor with the FPD. See La. R.S. 33:2561(A). After the split decision of the CS Board that resulted in an affirmation of the action of the FPD Board, Dwyer appealed to the district court for a determination of whether the CS Board’s decision was made in “good faith for cause” under the provisions of La. R.S. 33:2531-2569. The sole issue before the district court was whether the CS Board acted in good faith and for cause. See La. R.S. 33:2561(E). Good faith does not exist if the appointing authority (the FPD Board in this case) acted arbitrarily or |6capriciously, or as the result of prejudice or political expediency. See Moore v. Ware, 2001-3341 (La.2/25/03), 839 So.2d 940, 945-946. Arbitrary or capricious means the lack of a rational basis for the action taken. Id., 839 So.2d at 946; Landry v. Baton Rouge Police Dept., 2008-2289 (La.App. 1st Cir.5/8/09), 17 So.3d 991, 995.

The district court’s review of the CS Board’s quasi-judicial administrative determination is an exercise of appellate jurisdiction. Baton Rouge Police Dept. v. O’Malley, 2010-1386 (La.App. 1st Cir.3/25/11), 64 So.3d 773, 776. The district court may not substitute its opinion for that of the CS Board, but should accord deference to the CS Board’s factual conclusions, and must not overturn them unless they are manifestly erroneous. Id., 64 So.3d at 776-777. The district court has a limited review of the CS Board’s findings of fact. Those findings are entitled to the same weight as findings of fact made by a trial court and are not to be overturned in the absence of manifest error. Id.

The district court in this case reviewed the record and considered the arguments of counsel before rendering judgment affirming the CS Board’s action. The district court gave the following oral reasons:

[Dwyer] was the only employee in the [firefighter/operator] classification. When her position was abolished, the applicable statutes required that she be transferred to another position in that class. As noted, there is no other position in that class to which [Dwyer] could be transferred and there is, or was[,] no lower class. The action of the [FPD Board] was made for purely economic reasons in good faith and for cause. The action of the [CS Board] is hereby affirmed. (Emphasis added.)

This court has carefully reviewed the record of the proceedings before the CS Board, and we find no evidence that the CS Board acted in bad faith in upholding the FPD Board’s action of abolishing Dwyer’s classified firefighter/operator position. The split decision of the CS Board, resulting in an affirmation of the FPD Board’s action, is clearly supported in the record and by the statutory law. A rational basis exists for the factual findings, and we find no |7manifest error or abuse of discretion in the district court’s decision to uphold the effective ruling of the CS Board. Moreover, because the CS Board made no finding of bad faith on the part of the FPD Board, it was without authority to modify the FPD Board’s actions. See La. R.S. 33:2561.

The record shows that Dwyer’s classified firefighter/operator position was abolished in good faith and for economic reasons. Additionally, the record reveals that there was no other classified position within Dwyer’s class to which she could be demoted or transferred. The data processor position that Dwyer desires to be placed in is not a classified civil service position at this time. Thus, the law required that Dwyer be laid off and placed on a re-employment list in accordance with La. R.S. 33:2548, La. R.S. 33:2558, and La. R.S. 33:2559. See also La. R.S. 33:2550(0; La. R.S. 33:2551(2) and (3). Therefore, we find the district court used the correct standard of review, and we find no clear basis for modifying the district court’s judgment. See Meiners v. St. Tammany Fire Protection District #4 Bd. of Com’rs, 2009-0435 (La.App. 1st Cir.9/10/10), 47 So.3d 1031, 1033, writ denied, 2010-2290 (La.12/10/10), 51 So.3d 728.

CONCLUSION

For the above reasons, we convert Col-lette Dwyer’s appeal to an application for supervisory writs, grant the request for supervisory review of the merits, and affirm the district court’s judgment, thereby upholding the abolishment of the classified firefighter/operator position with the West Feliciana Fire Protection District No. 1. All costs of this supervisory writ application are assessed against plaintiff/appellant, Collette Dwyer.

APPEAL CONVERTED TO APPLICATION FOR SUPERVISORY WRIT; WRIT GRANTED; AND DISTRICT COURT JUDGMENT AFFIRMED.

      . In Miazza v. City of Mandeville, 2010-0304 (La.5/21/10), 34 So.3d 849 (per curiam), the supreme court stated that when the legislature has vested appellate jurisdiction in the district court, as in this case, pursuant to La. R.S. 33:2561(E), the court of appeal lacks appellate jurisdiction. However, a court of appeal may exercise supervisory jurisdiction over all matters arising within its jurisdiction. La. Const, art. V, § 10(A).

      . The record reflects that the total financial impact of the reorganization approximated $112,000.00 annual savings for the FPD.

      . Louisiana Revised Statute 33:2536(M) provides in pertinent part: "[t]wo members of a three-member board ... shall constitute a quorum, and the concurring votes of a simple majority of members shall be sufficient for the decision of all matters to be decided or transacted by it.”

      . In regard to abolition of positions in the classified service, La. R.S. 33:2558 provides as follows:
      Whenever the appointing authority abolishes a position in the classified service and there is no position vacant in the respective class to which the regular employee of the abolished position may be transferred, the employee shall be transferred to any position of the same class which may be held by a provisional employee. If there is no such position, he shall be transferred to another position in the respective class, and the holder of that position thereupon shall be demoted in the order provided by [La.] R.S. 33:2548. (Emphasis added.)
      Further, the term "class” as used in the pertinent civil service statutes does not mean the same as "position”; each class may contain one or more positions, and the appointing authority may abolish a position within a class without the formality of a civil service board hearing. See Odom v. City of Minden, 300 So.2d 462, 463 (La.1974). But if an entire class is abolished, action of the appropriate civil service board is required, as well as compliance with due process. See City of Shreveport v. Plaisance, 559 So.2d 944, 945 (La.App. 2d Cir.), writ denied, 564 So.2d 324 (La.1990). See also La. R.S. 33:2533(5) (definition of "class”); La. R.S. 33:2533(13) (definition of "position”); and La. R.S. 33:2548 (regarding “demotions”).

      .Louisiana Revised Statute 33:2561(D), as amended and reenacted by 1999 La. Acts, No. 457, § 1, provides, in pertinent part: "If such recusal by a member of the board results in the inability of the board to make a finding of fact or to reach a decision by the concurring votes as provided by [La.] R.S. 33:2536(M), the board shall be considered to have affirmed the action of the appointing authority.” (Emphasis added.) The appointing authority in this case is the FPD Board. We distinguish our prior decision, Talley v. St. Tammany Fire Protection District No. 1, 970569 (La.App. 1st Cir.5/15/98), 713 So.2d 709, 712, which was decided under the former version of La. R.S. 33:2561.

      . Dwyer argues in the alternative that the FPD Board failed to comply with the notice provisions of the Open Meetings Law found in former La. R.S. 42:4.1 through 42:9 (redesig-nated as La. R.S. 42:11 to 42:24 by 2010 La. Acts, No. 861, § 23), when the FPD Board effectively abolished the classified position of firefighter/operator without prior notice; therefore, the FPD Board's action should be voided and her position should be reinstated. Although Dwyer did not properly assert this issue in an assignment of error and the district court did not mention this issue in its oral reasons for judgment or in the actual written judgment, both parties discussed the issue in their memoranda filed in the district court and in their briefs filed in this court. Thus, we have considered the argument, but find that Dwyer's claim was barred by the sixty-day limitation period of the Open Meetings Law, since Dwyer did not timely assert that claim in her appeal to the CS Board or the district court. See Greemon v. City of Bossier City, 2010-2828 (La.7/1/11), 65 So.3d 1263, 1272.
      Further, even if we assume that the claim was asserted timely, the record reflects that the agenda of the regularly-scheduled January 11, 2010 meeting of the FPD Board was posted in accordance with the Louisiana Open Meetings Law. At the beginning of the meeting, the FPD Board unanimously voted to amend the agenda, in accordance with La. R.S. 42:17 and 42:19, to include the personnel committee's recommendations regarding restructuring of the FPD. The amendment did not involve a disciplinary or discharge discussion, in an executive session or otherwise, concerning Dwyer’s job, her performance, abilities, or character. The restructure proposal for the FPD was addressed by the FPD Board as a purely economic issue that would result in substantial annual savings to the FPD and would necessarily include the abolishment of the classified firefighter/operator position along with several unclassified volunteer and contract positions.


source: Caselaw Access Project

author: MICHAEL E. KIRBY, Judge.

license: Public Domain

text:
    BOARD OF SUPERVISORS OF LOUISIANA STATE UNIVERSITY AND AGRICULTURAL AND MECHANICAL COLLEGE v. 2330 PALMYRA STREET, L.L.C. and City of New Orleans. Board of Supervisors of Louisiana State University and Agricultural and Mechanical College v. PFD Two, L.L.C. (Formerly Known as Nora Two, L.L.C.), et al. Board of Supervisors of Louisiana State University and Agricultural and Mechanical College v. 2226 Canal Street, L.L.C., et al. Board of Supervisors of Louisiana State University and Agricultural and Mechanical College v. 2300 Canal Street, LLC, et al.
    Nos. 2011-CA-0443, 2011-CA-0499, 2011-CA-0565, 2011-CA-0566.
    Court of Appeal of Louisiana, Fourth Circuit.
    Dec. 27, 2011.

      J. Kenton Parsons, Luke F. Piontek, Thomas J. Capella, Christian Rhodes, Gayle Thomasson Kellner, Shelley Ann McGlathery, Roedel Barsons Koch Blache Balhoff & McCollister, New Orleans, LA, for Plaintiff/Appellee.
    Leopold Z. Sher, James M. Garner, Raymond C. Lewis, Mary Beth Akin, Sher Garner Cahill Richter Klein & Hilbert, L.L.C., New Orleans, LA, for Defendant/Appellant.
    (Court composed of Chief Judge JOAN BERNARD ARMSTRONG, Judge PATRICIA RIVET MURRAY, Judge MICHAEL E. KIRBY).
   MICHAEL E. KIRBY, Judge.

| ¶ This matter is a consolidation of four separate appeals by 2330 Palmyra Street, L.L.C. (“2330 Palmyra Street”); PFD Two, L.L.C. (Wa Nora Two, L.L.C.) (“PFD Two”); 2226 Canal Street, L.L.C. (“2226 Canal Street”); and 2300 Canal Street, L.L.C. (“2300 Canal Street”). The appellants are four property owners whose properties were expropriated by the Board of Supervisors of Louisiana State University and Agricultural and Mechanical College (“Board of Supervisors” or “Board”) for the site of the future LSU-affiliated Academic Medical Center/ United States Veterans Administration Hospital Complex (“LSUAMC/VA Hospital Complex”). In response to the Board of Supervisors’ petitions for expropriation, the property owners filed reconventional demands seeking additional compensation for damages allegedly sustained prior to the expropriation of their properties, as a result of a moratorium issued by the City of New Orleans in 2007, and renewed in 2008 and 2009, prohibiting the issuance of any building permits for construction, renovations, repairs or demolition of buildings in the area 1 ^encompassing the site of the future LSU/VA Hospital Complex. The Board of Supervisors responded to each reconventional demand by filing a declina-tory exception of lack of subject matter jurisdiction; dilatory exception of prematurity; and peremptory exceptions of prescription, nonjoinder of a party, and no cause of action. Following hearings in separate divisions in the district court, the trial court in Division G granted all the exceptions while the trial court in Division M granted only the exceptions of no cause of action. The property owners appealed. For the reasons that follow, we reverse the trial court judgments of December 29, 2010 and February 7, 2011, and reverse, in part, both judgments of January 25, 2010.

FACTUAL BACKGROUND

The Board of Supervisors filed their petitions for expropriation in July and August of 2010. Prior to the expropriations, the properties were part of The PFD Group’s real estate investment portfolio, which included a number of residential and commercial properties located in the area designated to be the site of the future LSUAMC/VA Hospital Complex. The PFD Group had planned to renovate and lease the properties to serve as commercial and residential rental properties for persons and businesses returning to the City after Hurricane Katrina.

In 2007, the State of Louisiana, through the Board of Supervisors, commenced its efforts in furtherance of the expropriation by entering into a Cooperative Endeavor Agreement (“CEA”) with the City to acquire the property, |3and two formal Mem-oranda of Understanding (“MOU”), one between the State and the City, and one between the State and the VA. According to the expropriation petition, the purpose of the CEA and MOU was to enable the State to expropriate the properties by working in conjunction with the City and the VA.

On November 15, 2007, in furtherance of the MOU and the Board of Supervisors’ efforts to expropriate the property, the New Orleans City Council adopted Ordinance No. 22900, imposing a general moratorium on new building permits in the proposed area of the future LSUAMC/VA Hospital Complex. The City renewed the moratorium with ordinances in 2008 and 2009.

In their reconventional demands, the property owners allege that the Board of Supervisors aided by the MOU, CEA, and resulting moratoria, created and sustained an atmosphere in which the properties within the proposed LSUAMC/VA Hospital Complex site became severely devalued. They contend that from 2007 to the expropriation in 2010, their property values plummeted and investment opportunities ceased, because they were prevented from developing and/or improving their properties. As a result, the property owners allege the State benefitted by paying a depreciated real estate price for the expropriated properties. Specifically, the property owners argue that the 2007 moratorium constituted a “taking” in violating of Article I, § 4 of the Louisiana Constitution, and that the amount offered by the State for their properties fails to compensate them for the “full extent” of their losses as mandated by the constitution.

Louisiana Const. Article I, § 4 states, in pertinent part:

Section 4. (A) Every person has the right to acquire, own, control, use, enjoy, protect, and dispose of private property. |4This right is subject to reasonable statutory restrictions and the reasonable exercise of the police power.
(B)(1) Property shall not be taken or damaged by the state or its political subdivisions except for public purposes and with just compensation paid to the owner or into court for his benefit....
(5) In every expropriation or action to take property pursuant to the provisions of this Section, a party has the right to trial by jury to determine whether the compensation is just, and the owner shall be compensated to the full extent of his loss. Except as otherwise provided in this Constitution, the full extent of loss shall include, but not be limited to, the appraised value of the property and all costs of relocation, inconvenience, and any other damages actually incurred by the owner because of the expropriation. [Emphasis added.]

In Coleman v. Chevron Pipe Line Co., 94-1773, p. 8 (La.App. 4 Cir. 4/24/96), 673 So.2d 291, 297, this Court noted that in every expropriation the property owner must be “compensated to full extent of his loss,” quoting La. Const.1974, Art. I, § 4, and stating: “[generally this means, that the owner should be ‘put in as good a position pecuniarily as he would have been had his property not been taken,’ ” quoting State Dept. of Highways v. Bitterwolf, 415 So.2d 196, 199 (La.1982).

The Board of Supervisors refers to the property owners’ reconventional demand as an inverse condemnation claim. This Court has commented on inverse condemnation in City of New Orleans v. Badine Land Ltd., 2007-1066, pp. 4-5 (La.App. 4 Cir. 5/21/08), 985 So.2d 832, 835-836, as follows:

The Louisiana Constitution, Article I, Section 4 provides for compensation to a landowner whose property rights are taken or damaged. When a landowner suffers a taking or damage in the absence of an expropriation proceeding he may seek compensation through an inverse condemnation action. Constance v. State Through Dept. of Transp. and Development, Office of Hwys., 626 So.2d 1151, 1156 (La.1993); and Reymond v. State Through Dept. of Highways, 255 La. 425, 447, 231 So.2d 375, 383 (La.1970). The Louisiana Supreme Court in State, Through Dept. of Transp. and Development v. Chambers Inv. Co., Inc., 595 So.2d 598 (La.1992), acknowledged that under the Constitution compensation is required even though the State has not initiated an expropriation proceeding and physically taken property from the owner. Id. at 602; also see Reymond, supra. The Chambers court went on to set forth a three-prong test to assist in establishing whether a constitutional taking has occurred. The factors for the court to decide are as follows: 1) whether a person’s legal right with respect to a thing or an object has been affected; 2) whether the property, either a right or a thing, has been taken or damaged, in a constitutional sense; and 3) whether the taking or damaging was for a public purpose. Id., 595 So.2d at 603.

Exception of No Cause of Action

All four property owners have appealed the trial courts’ granting of the Board of Supervisors’ exception of no cause of action.

The function of the peremptory exception of no cause of action is to question whether the law extends a remedy to anyone under the factual allegations of the petition. Fink v. Bryant, 2001-0987, p. 3 (La.11/29/01), 801 So.2d 346, 348-349. The burden of proof is on the exceptor. Raspanti v. Litchfield, 2005-1512, p. 6 (La.App. 4 Cir. 11/21/06), 946 So.2d 234, 238. The exception is tried on the face of the pleadings, and the court accepts the facts alleged in the petition as true, determining whether the law would afford relief to the plaintiff if those facts are proved at trial. Cleco Corp. v. Johnson, 2001-0175, p. 3 (La.9/18/01), 795 So.2d 302, 304. The question is whether, viewing the petition in the light most favorable to plaintiffs, and with every doubt resolved in their favor, the petition states any valid cause of action for relief. Rutledge v. Hibernia, 2000-0674, p. 2 (La.App. 4 Cir. 1/16/02), 808 So.2d 765, 766.

[(No evidence may be introduced to support or controvert the objection that the petition fails to state a cause of action. La. C.C.P. art. 931. In reviewing a trial court’s ruling on the exception, the appellate court should conduct a de novo review. Brookewood Investments Co., L.L.C. v. Sixty-Three Twenty-Four Chef Menteur Highway, L.L.C., 2007-0050, p. 2 (La.App. 4 Cir. 5/16/07), 958 So.2d 1200, 1201. A petition should not be dismissed for failure to state a cause of action unless it appears beyond doubt that the plaintiff (here, the plaintiffs in reconvention) can prove no set of facts in support of any claim which would entitle him (them) to relief. Fink, 2001-0987, p. 4, 801 So.2d at 349.

In asserting the exception of no cause of action, the Board of Supervisors argued that the claims that are the subject of the exception are separate and distinct from the property owners’ other claims because the date of the taking is the date of the expropriation petition was filed, and not as of the date of the moratorium, the “announcement” or the dates of the MOU and/or CEA, i.e., 2007.

In response, the property owners argue that the Board of Supervisors is effectively seeking a prohibited partial exception of no cause of action because the owners have not set forth two separate causes of action arising out of the operative facts of separate and distinct transactions or occurrences.

In Everything on Wheels Subaru, Inc. v. Subaru South, Inc., 616 So.2d 1234 (La.1993), the Louisiana Supreme Court recognized that there had been uncertainty in the area of partial judgments on exceptions of no cause of action, stating that it was taking the “opportunity to discuss partial judgments and to distinguish those cases involving separate and distinct causes of action properly cumulated in a single suit from those cases involving a single cause of action while 17asserting several types of relief or demanding several elements of damages.” 616 So.2d at 1237. The court elaborated and set forth the following rules:

If there are two or more items of damages or theories of recovery which arise out of the operative facts of a single transaction or occurrence, a partial judgment on an exception of no cause of action should not be rendered to dismiss one item of damages or theory of recovery. In such a case, there is truly only one cause of action, and a judgment partially maintaining the exception is generally inappropriate.
However, if two or more actions are cumulated which could have been brought separately because they were based on the operative facts of separate and distinct transactions or occurrences, a partial judgment may be rendered to dismiss one action on an exception of no cause of action, while leaving the other actions to be tried on the merits. In such a case, there are truly several causes of action, and a judgment partially maintaining the exception as to one separate and distinct cause of action is generally appropriate....

616 So.2d at 1239.

The property owners do not expressly assert separate causes of action in their reconventional demands. They set forth facts of the expropriation process, virtually from the inception of the idea for the project through expropriation. In them prayer for damages, they seek damages for the actual value of the property taken as of the proper valuation date — including the added value attributable to each property as part of the total real estate package owned by The PFD Group. They also seek inconvenience and delay damages; foregone business profits; and “future net income on properties whose redevelopment was halted due to the announced expropriation and/or the expropriation process.”

Delay damages are routinely sought by landowners in expropriation suits filed by the State and its agencies. See West Jefferson Levee Dist. v. Coast Quality Const. Corp., 93-1718 (La.5/23/94), 640 So.2d 1258 (award for delay damages reversed by Louisiana Supreme Court on the ground that the levee district | defendant’s four-year delay in taking action from the time it obtained a U.S. Corps of Engineers permit for construction of a levee until the time it actually filed the expropriation suits did not cause the landowners any damage, as during that time the landowners already were prohibited from developing their land by, inter alia, the existence of a cease and desist order issued by the Corps prohibiting such development); State, Dept. of Transp. and Dev. v. August Christina & Bros., Inc., 97-244 (La.App. 5 Cir. 2/11/98), 716 So.2d 372 (defendant landowner filed answer and reconventional demand seeking an increase in compensation, severance damages, and delay damages, although failure to award delay damages affirmed on appeal on the facts of the case); State, Dept. of Transp. and Dev. v. McMillion Dozer Service, Inc., 93-590 (La.App. 5 Cir. 5/31/94), 639 So.2d 766 (defendant landowner filed answer seeking additional compensation, including delay damages); State, Dept. of Transp. and Dev. v. Brookhollow of Alexandria, Inc., 578 So.2d 558 (La.App. 3 Cir.1991) (defendant landowner filed answer seeking additional compensation, including delay damages).

In the instant case, while the property owners seek separate delay damages, they also seek damages for the halting of the development of their property due to the announced expropriation and/or the expropriation process. However, those damages are very similar in nature to delay damages. Given that a demand for delay damages must be asserted by a landowner in any claim it makes for additional compensation in an expropriation action filed by the State or its agencies, the damages for the halting of the property owners’ redevelopment of their properties due to the “announced” expropriation and/or expropriation process would likewise have to be asserted at that time, or be subject to a plea of res \ judicata if raised in a later, sepai'ate action. See La. C.C.P. art. 425 and La. R.S. 13:4231.

In conclusion, there are not two separate causes of action arising out of the operative facts of separate and distinct transactions or occurrences in the instant cases. Rather, the instant cases involve two or more items of damage or theories of recovery which arise out of the operative facts of a single transaction or occurrence. Accordingly, the Board of Supervisors cannot seek a partial exception of no cause of action on these particular claims by the property owners.

Moreover, even assuming for the sake of argument that the exception of no cause of action as to the property owners’ pre-ex-propriation damage claims — to the extent they can be separated from their claims for inconvenience and delay damages— would be permissible under Everything on Wheels, supra, the property owners have adequately set forth factual allegations as to those claims. Viewing the reconven-tional demand petition in the light most favorable to the property owners, and with every doubt resolved in their favor, the petition states a valid cause of action for relief. Thus, we find the trial courts (Judge Giarrusso and Judge Irons) erred in concluding otherwise.

Exception of Lack of Subject Matter Jurisdiction

The property owners, 2330 Palmyra Street and PFD Two, argue that the trial court (Judge Giarrusso) erred in granting the Board of Supervisors’ declina-tory exception of lack of subject matter jurisdiction.

La. C.C.P. art. 2 defines jurisdiction over the subject matter as, “the legal power and authority of a court to hear and determine a particular class of actions or 1 ^proceedings, based upon the object of the demand, the amount in dispute, or the value of the right asserted.”

In its exception, the Board of Supervisors argued that the trial court had no jurisdiction over the property owners’ re-conventional demands regarding the City Council-imposed moratorium that was in effect before the expropriation occurred, asserting that their claims are “only appropriately addressed by the administrative agency with exclusive subject matter jurisdiction over the moratorium, the Council of the City of New Orleans.”

Specifically, the Board of Supervisors emphasized that under the City of New Orleans Home Rule Charter legislative powers are vested in the City Council; that in furtherance of its police powers the City Council may, under the Home Rule Charter, impose a moratorium ordinance such as the ones at issue; and that § 3-126(3) of the Home Rule Charter provides that any moratorium ordinance or other temporary prohibition shall provide for a right of appeal to the City Council for waivers or exceptions thereto. Thus, the Board of Supervisors argued, the property owners had to first exhaust their administrative remedies before seeking judicial relief.

City Council Ordinance No. 22900 and the subsequent ordinances expressly provided that any party aggrieved by the ordinances could appeal to the City Council for a waiver of the provisions of the ordinances. However, the ordinances’ appeal provisions expressly stated that, ultimately, the City Council “may ... waive the provisions ... of this ordinance ... folloioing a determination by the Council that the issuance of the requested permit would not either thwart the purpose of this tempora'ry measure, which is to enable the development of the Veterans Administration Hospital and LSU Medical District, .... ” (Emphasis ours).

In U.S. v. Orr Water Ditch Co., 914 F.2d 1302, 1310 (9 Cir.1990), the federal appeals court noted that, although under the applicable Nevada law a party generally had to first exhaust its administrative remedies before seeking judicial relief, “one need not ‘initiate and participate in proceedings ... which are vain and futile.’ ” (Citation omitted).

In granting the exception of lack of subject matter jurisdiction, Judge Giarrusso found that 2330 Palmyra Street and PFD Two chose not to seek any permits or waivers despite the language in the ordinance that would have allowed them to do so.

Nonetheless, we find that considering the appeal provisions of Ordinance No. 22900 and the later ordinances, had the property owners sought a waiver and permit through the administrative process, either: (1) they would have been denied a permit on the ground that the issuance thereof would have thwarted the development of the LSUAMC/VA Hospital Complex; or (2) that, considering the well-publicized push for the project by the City and the Board of Supervisors, it would have been reasonable for the property owners to believe, at least as early as the 2007 enactment of the first moratorium, that any investment in their properties would have been for naught, given that the expropriation was inevitable.

The proposed LSUAMC/VA Hospital Complex, according to Ordinance No. 22900, was to be the anchor for a Regional Bioscience Development; was expected to create nine thousand jobs “vital to the recovery and diversification of the city of New Orleans economy;” and serve “the public purpose of providing healthcare to the citizens of New Orleans.” Under these circumstances, we find the property owners were not required to exhaust them administrative remedies by seeking a waiver of the moratorium, when the expropriation was inevitable and any such Inaction would have been vain and futile. Therefore, we find the trial court has jurisdiction over the subject matter of the property owners’ claims for any damages they allegedly sustained from 2007 to the expropriation in 2010, and the trial court erred in concluding otherwise.

Exception of Prescription

2330 Palmyra Street and PFD Two next argue that the trial court erred in granting the peremptory exception of prescription. The Board of Supervisors based its exception of prescription on prescriptive periods for the property owners’ taking of appeals from any administrative denial of a waiver relative to the City Council’s moratorium. However, that issue is moot in view of the above discussion on the exception of lack of subject matter jurisdiction.

Further, under La. R.S. 13:5111(A), “[ajctions for compensation for property taken by the state, a parish, municipality, or other political subdivision or any one of their respective agencies shall prescribe three years from the date of such taking.” La. R.S. 13:5111(A) covers actions for inverse condemnation. See SDS, Inc. v. State, Dept. of Transportation and Development, 2007-0406 (La.App. 4 Cir. 2/13/08), 978 So.2d 1013 (La. R.S. 13:5111(A) cited as basis for award of expert witness fees in an inverse condemnation action).

Assuming, for the sake of argument, that the property owners sustained damages beginning in November 2007, when the Council passed Ordinance No. 22900, the property owners would have had until November 2010 under La. R.S. 13:5111(A) within which to bring an inverse condemnation action against the Board of Supervisors.

| isThe property owners’ reconventional demands, to the extent they were based on claims of inverse condemnation, were filed in July, August and September 2010, less than three years after the Council passed the moratorium. Notably, the property owners do not limit their pre-expropriation damages to the effect of the City Council’s moratorium.

Also, the petition for expropriation states that it was being brought pursuant to La. R.S. 19:141, et seq. Under La. R.S. 19:150, an owner of property expropriated pursuant to La. R.S. 19:141, et seq., has thirty days from the service of the petition for expropriation in which to assert a claim for “additional compensation.” The record indicates that each property owner filed their reconventional demand less than thirty days after service of the Board’s petition for expropriation.

Thus, we find the trial court (Judge Giarrusso) erred in granting the Board of Supervisors’ peremptory exception of prescription.

Exception of Prematurity

In asserting the exception of prematurity, the Board of Supervisors argued that the property owners’ claims were premature, given that they had not exhausted their administrative remedies. As noted above, in light of these specific facts and circumstances, we find that the property owners were not required to exhaust their administrative remedies seeking a waiver of the City Council’s moratorium when the expropriation of their properties was clearly inevitable and any such action would have been vain and futile. Thus, we find the trial court (Judge Giarrusso) erred in granting the exception of prematurity.

1 uException of Nonjoinder of a Party under La. C.C.P. art. 641

2330 Palmyra Street and PFD Two next argue that the trial court erred in granting the Board of Supervisors’ peremptory exception of nonjoinder of a party under La. C.C.P. art. 641, for their failure to join the City as a defendant to their reconventional demands.

The Board of Supervisors, in asserting the peremptory exception of nonjoinder of a party, argued that without the joinder of the City as a defendant in 2330 Palmyra Street’s and PFD Two’s reconventional demands complete relief cannot be afforded the parties.

2330 Palmyra Street and PFD Two counter that their claims are not simply based on the City Council’s moratorium, but on the State’s “expropriation process, virtually from the inception of the idea of the project through the expropriation.” As property owners whose properties were “taken,” they seek recovery of the compensation guaranteed by the Louisiana Constitution from the State, not the City.

Under La. C.C. art. 2323, in any action for damages where a party suffers loss, the degree or percentage of fault of all persons causing or contributing to the loss shall be determined, regardless of whether the person is a party to the action or a nonparty, and regardless of that person’s immunity by statute.

| ^Considering the above principles of comparative fault, we find that complete relief can be accorded the parties to the instant actions — with the Board of Supervisors not being held liable for any fault attributable to any nonparty.

Thus, we find the trial court (Judge Giarrusso) erred in granting the exception of nonjoinder of a party under La. C.C.P. art. 641.

In summary, we conclude the trial court (Judge Giarrusso) erred rendering judgment against 2330 Palmyra Street and PFD Two and granting the Board of Supervisors’ declinatory exception of lack of subject matter jurisdiction; dilatory exception of prematurity; and peremptory exceptions of prescription, nonjoinder of a party, and no cause of action. We further conclude that the trial court (Judge Irons) erred in rendering judgment against 2226 Canal Street and 2300 Canal Street, insofar as the court granted the Board of Supervisors’ peremptory exception of no cause of action.

DECREE

Accordingly, for the reasons herein:

The December 29, 2010 judgment in the Board of Supervisors of Louisiana State University and Agricultural and Mechanical College v. 2330 Palmyra Street, L.L.C., et al., Civil District Court for the Parish of Orleans, No. 2010-7983, Division G-11, is reversed and the Board of Supervisors’ exceptions are all denied;

The February 7, 2011 judgment in the Board of Supervisors of Louisiana State University and Agricultural and Mechanical College v. PFD TWO, L.L.C. (f/k/a NORA TWO, L.L.C.), et al., Civil District Court for the Parish of Orleans, No. 2010-7985, Division G-11, is reversed and the Board of Supervisors’ exceptions are all denied;

The January 25, 2011 judgment in the Board of Supervisors of Louisiana State University and Agricultural and Mechanical College v. 2226 Canal Street, L.L.C., et al., Civil District Court for the Parish of Orleans, No. 2010-7575, Division M-13, is reversed, in part, and the Board of Supervisors’ exception of no cause of action is denied;

The January 25, 2011 judgment in the Board of Supervisors of Louisiana State University and Agricultural and Mechanical College v. 2300 Canal Street, L.L.C., et al., Civil District Court for the Parish of Orleans, No. 2010-7577, Division M-13, is reversed, in part, and the Board of Supervisors’ exception of no cause of action is denied; and,

Each of the above cases is remanded to the district court for further proceedings.

2011-CA-0443 REVERSED AND REMANDED.

2011-CA-0499 REVERSED AND REMANDED.

2011-CA-0565 REVERSED IN PART AND REMANDED.

2011-CA-0566 REVERSED IN PART AND REMANDED.

      . According to the motion to consolidate the appeals, the appellants are all entities owned by the same parent company, The PFD Group, L.L.C. ("The PFD Group”), a New Orleans based real estate leasing and development company.

      . The hospital is referred to as both the Veterans Affairs Hospital and Veterans Administration Hospital throughout the record.

      . In the suits against 2330 Palmyra Street and PFD TWO, Honorable Robin M. Giarrus-so, Judge, Orleans Parish Civil District Court, Division G, rendered the judgments of December 29, 2010, and February 7, 2011, respectively, granting all the exceptions. In the suits against 2226 Canal Street and 2300 Canal Street, Honorable Paulette Irons, Judge, Orleans Parish Civil District Court, Division M, rendered the judgments of January 25, 2010, granting the exceptions of no cause of action only.

      . La. C.C.P. art. 641 states:
      A person shall be joined as a party in the action when either:
      (1) In his absence complete relief cannot be accorded among those already parties.
      (2) He claims an interest relating to the subject matter of the action and is so situated that the adjudication of the action in his absence may either:
      (a) As a practical matter, impair or impede his ability to protect that interest.
      (b) Leave any of the persons already parties subject to a substantial risk of incurring multiple or inconsistent obligations.


author: GENOVESE, Judge.

text:
    Jon Andrew DELAHOUSSAYE v. The ROMAN CATHOLIC DIOCESE OF LAFAYETTE, Louisiana; the Most Reverend Charles E. Langlois; Catholic High School of New Iberia; and Timothy Uhl.
    No. 11-486.
    Court of Appeal of Louisiana, Third Circuit.
    Dec. 28, 2011.

      Allan L. Durand, Lafayette, LA, for PlaintiffAppellant, Jon Andrew Delahous-saye.
    Troy Allen Broussard, Allen & Gooch, A Law Corporation, Lafayette, LA, for Defendants/Appellees, The Roman Catholic Diocese of Lafayette, Louisiana, Reverend Charles E. Langlois, Catholic High School of New Iberia, and Timothy Uhl.
    Court composed of SYLVIA R. COOKS, JAMES T. GENOVESE, and PHYLLIS M. KEATY, Judges.
   GENOVESE, Judge.

11 Plaintiff, Jon Andrew Delahoussaye, appeals the grant of summary judgment in favor of Defendants, the Roman Catholic Diocese of Lafayette, Louisiana (the Diocese), Reverend Charles E. Langlois (Rev. Langlois), Catholic High School of New Iberia (Catholic High), and Timothy Uhl (Dr. Uhl), which dismissed his defamation suit. For the following reasons, we affirm.

FACTUAL AND PROCEDURAL BACKGROUND

In 2009, Mr. Delahoussaye was a member of the school board for Catholic High. By letter dated May 12, 2009, Mr. Dela-houssaye was dismissed from the school board by its chancellor, Rev. Langlois. On May 14, 2009, the principal of Catholic High, Dr. Uhl, read the letter from Rev. Langlois to Mr. Delahoussaye aloud during a school board meeting. The letter read:

Dear Mr. Delahoussaye,
It seemed apparent at the last meeting of the School Board of Catholic High School that you are determined to disrupt School Board business.
Your accusation that the principal, Dr. Uhl, has “taken away” $30,000.00 donated to the visitors bleachers is without foundation. Dr. Uhl denies your accusation.
Your effectiveness as a School Board member is greatly impaired. I don’t see how you will be able to work with the principal, the school board, and myself. Therefore, I am removing you from the School Board of Catholic High effective immediately. Please do not attend the May meeting of May 14, 2009, or any other meeting.
Sincerely,
Rev. Charles E. Langlois
Chancellor, Catholic High School

Mr. Delahoussaye filed suit for defamation and sought damages for intentional infliction of emotional distress. Defendants filed a motion for summary judgment, alleging that Mr. Delahoussaye lacked sufficient factual support for his 12claims. In support of his position, Mr. Delahoussaye, who works in the insurance industry, introduced an affidavit of his father, Errol J. Delahoussaye, who likewise works in the insurance industry, which corroborated his allegations that Defendants’ actions had damaged his reputation and had caused him emotional distress. Accordingly, Mr. Delahoussaye argued summary judgment was inappropriate because genuine issues of material fact existed.

After a hearing, the trial court stated that it deemed the affidavit presented by Mr. Delahoussaye to be “self-serving,” granted Defendants’ motion for summary judgment, and dismissed Mr. Delahous-saye’s claims with prejudice. Mr. Dela-houssaye has appealed.

LAW AND ANALYSIS

Assignments of Error

On appeal, Mr. Delahoussaye asserts that the trial court erred: (1) in making a credibility determination with regard to the affidavit he introduced; and (2) in granting Defendants’ motion for summary judgment dismissing his claim for defamation, in spite of the fact that he introduced an affidavit from a qualified third party which created genuine issues of fact with regard to all relevant elements of defamation.

Standard of Review

“Appellate courts review summary judgment de novo, using the same criteria that govern the trial court’s consideration of whether summary judgment is appropriate, and in the light most favorable to the non-movant.” Yokum v. 615 Bourbon Street, L.L.C., p. 25 (La.2/26/08), 977 So.2d 859, 876 (citing Suire v. Lafayette City-Parish Consol. Gov’t., 04-1459 (La.4/12/05), 907 So.2d 37). Louisiana Code of Civil Procedure Article 966(A)(2) states “[t]he summary judgment procedure is designed to secure the just, speedy, and inexpensive ^determination of every action,” and this “procedure is favored and shall be construed to accomplish these ends.” “[I]f the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue of material fact,” then judgment shall be granted as a matter of law in favor of the mover. La.Code Civ.P. art. 966(B) and (C). Defendants, as the movants herein, bear the initial burden of proof and must show that no genuine issue of material fact exists. See La.Code Civ.P. art. 966(C)(2). If Defendants successfully meet their burden, then the burden shifts to Mr. Dela-houssaye to present factual support adequate to establish that he will be able to satisfy his evidentiary burden at trial. Id. If Mr. Delahoussaye fails to produce the factual support necessary to establish that he will be able to satisfy his evidentiary burden of proof at trial, then there is no genuine issue of material fact. Id.

A fact is material if it potentially insures or precludes recovery, affects a litigant’s ultimate success, or determines the outcome of the legal dispute. Smith v. Our Lady of the Lake Hosp., Inc., 93-2512, p. 27 (La.7/5/94), 639 So.2d 730, 751. A genuine issue is one as to which reasonable persons could disagree; if reasonable persons could reach only one conclusion, there is no need for trial on that issue and summary judgment is appropriate. Id.

Hines v. Garrett, 04-306, p. 1 (La.6/25/04), 876 So.2d 764, 765-66.

Discussion

Mr. Delahoussaye, admittedly, has abandoned his intentional infliction of emotional distress cause of action. The sole cause of action presently before this court for consideration is Mr. Delahoussaye’s defamation claim.

In this case, Defendants, who are the movants in this motion for summary judgment, do not bear the burden of proof at trial on the issue of whether defamation occurred. Our supreme court, in Cyprien v. Board of Supervisors ex rel. University of Louisiana System, 08-1067, p. 6 (La.1/21/09), 5 So.3d 862, 866-67 (quoting Costello v. Hardy, 03-1146, p. 12 (La.1/21/04), 864 So.2d 129, 139), stated the following:

Defamation is a tort which involves the invasion of a person’s interest in his or her reputation and good name. Fitzgerald v. Tucker, 98-2313, p. 10 (La.6/29/99), 737 So.2d 706, 715; Trentecosta v. Beck, 96-2388, p. 10 (La.10/21/97), 703 So.2d 552, 559; Sassone v. Elder, 626 So.2d 345, 350 (La.1993). “Four elements are necessary to establish a defamation cause of action: (1) a false and defamatory statement concerning another; (2) an unprivileged publication to a third party; (3) fault (negligence or greater) on the part of the publisher; and (4) resulting injury.” Trentecosta, 96-2388 at 10, 703 So.2d at 559 (citing RESTATEMENT (SECOND) OF TORTS § 558 (1977)). The fault requirement is often set forth in the jurisprudence as malice, actual or implied. See, Cangelosi v. Schwegmann Bros. Giant Super Markets, 390 So.2d 196, 198 (La.1980) (which also considers falsity as a fifth and separate element); 12 WILLIAM E. CRAWFORD, LOUISIANA CIVIL LAW TREATISE: TORT LAW § 17.4 at 312 (2000). Thus, in order to prevail on a defamation claim, a plaintiff must prove “that the defendant, with actual malice or other fault, published a false statement with defamatory words which caused plaintiff damages.” Trentecosta, 96-2388 at 10, 703 So.2d at 559 (quoting Sassone, 626 So.2d at 350).
[....]
Finally, even when a plaintiff makes a prima facie showing of the essential elements of defamation, recovery may be precluded if the defendant shows either that the statement was true, or that it was protected by a privilege, absolute or qualified. Doe v. Grant, 01-0175, p. 9 (La.App. 4 Cir. 1/29/03), 839 So.2d 408, 416, [writ denied, 03-604] (La.5/2/03), 842 So.2d 1102; Arledge v. Hendricks, 30,588, p. 4 (La.App. 2 Cir. 6/26/98), 715 So.2d 135, 139.

Mr. Delahoussaye claims that Defendants defamed him when the May 12, 2009 letter announcing his removal from the school board was read aloud at the school board meeting on May 14, 2009. In opposition to Defendants’ motion for summary judgment, Mr. Delahoussaye, an independent insurance agent, introduced an affidavit of his father, Errol J. Delahoussaye, who also works in the insurance industry. The affidavit substantiated Mr. Delahous-saye’s assertions that his reputation was damaged by Defendants’ actions, but does not address any of the other elements of defamation, particularly the malice or other fault element.

| ^Defendants claim that the trial court was correct in granting their motion for summary judgment because Mr. Delahous-saye failed to produce factual support sufficient to establish that he will be able to satisfy his evidentiary burden of proof at trial on a defamation cause of action. We agree.

Though the affidavit of Errol J. Dela-houssaye corroborates the allegation that Mr. Delahoussaye’s reputation was damaged when the May 12, 2009 letter announcing his removal from the school board was read aloud at the school board meeting on May 14, 2009, the affidavit pertains only to the element of damages and does not present factual support for the element of malice, actual or implied, or any other fault. In order to show that there is a genuine issue of material fact that would preclude Defendants from successfully obtaining their motion for summary judgment, Mr. Delahoussaye must show evidence that he can carry the applicable burden of proving all four elements of defamation as set forth in Cyprien. Here, we find Mr. Delahoussaye did not offer proof of Defendants’ malice, actual or implied, or other fault. Thus, it is clear that Mr. Delahoussaye would not be able to carry his burden of proof as to all of the essential elements of the tort of defamation; therefore, there is no question of material fact, and Defendants are entitled to a judgment as a matter of law. Accordingly, we affirm the trial court’s grant of Defendants’ motion for summary judgment.

DECREE

For the foregoing reasons, the judgment of the trial court granting summary judgment in favor of Defendants, the Roman Catholic Diocese of Lafayette, Louisiana, Reverend Charles E. Langlois, Catholic High School of New Iberia, and Timothy Uhl, is affirmed. All costs of this appeal are assessed to Plaintiff/Appellant, Jon Andrew Delahoussaye.

AFFIRMED.


author: WALTER J. ROTHSCHILD, Judge.

text:
    Waylon LOPEZ v. MARQUES FOOD DISTRIBUTORS and LRASIF Claims Management.
    No. 11-CA-424.
    Court of Appeal of Louisiana, Fifth Circuit.
    Dec. 28, 2011.
    Rehearing Denied Feb. 7, 2012.

      Nanak S. Rai, Attorney at Law, New Orleans, LA, for PlaintiffiAppellee.
    Donald C. Douglas, Jr., Attorney at Law, Metairie, LA, for Defendant/Appellant.
    Panel composed of Judges MARION F. EDWARDS, CLARENCE E. McMANUS, and WALTER J. ROTHSCHILD.
   WALTER J. ROTHSCHILD, Judge.

|2On April 13, 2007, claimant, Waylon Lopez, was injured in a motor vehicle accident while in the course and cope of his employment as a truck driver for Marques Food Distributors (“Marques”). Mr. Lopez began receiving worker’s compensation indemnity benefits after the accident. In April 2008, Mr. Lopez had surgery on his right shoulder and, in August 2008, he had surgery on his left shoulder.

According to Marques, while paying indemnity benefits, it attempted to determine Mr. Lopez’s medical status, but Mr. Lopez would not cooperate. On April 9, 2009, Marques filed a disputed claim with the Office of Worker’s Compensation, asserting that there was a dispute as to Mr. Lopez’s disability status and non-compliance with the employer, including the need for a second medical examination and his refusal to provide medical reports to Marques. Marques also asserted that non-emergency treatment was obtained without prior request or approval, so it was only liable for the fees set forth in LSA-R.S. 23:1142.

On June 4, 2009, Mr. Lopez filed a disputed claim contending that Marques and its insurer refused to pay for surgeries that were requested and subsequently | aperformed, and asserting that he is entitled to a lumbar discogram and surgery that were recommended by his physician, and seeking penalties and attorney fees.

This case came for trial before the worker’s compensation judge on July 29, 2010. At trial, Marques voluntarily dismissed its disputed claim, indicating that the relief sought had been satisfied, and the matter proceeded on Mr. Lopez’s disputed claim. At the conclusion of trial, the case was left open for submission of post-trial briefs. On October 11, 2010, the worker’s compensation judge rendered a judgment. Thereafter, a Motion for New Trial was filed, and on November 22, 2010, an Amended Judgment was rendered by the worker’s compensation judge. In this judgment, the worker’s compensation judge found that:

1) Waylon Lopez was injured by accident during the course and scope of his employment with Marques Food Distributors on April 13, 2007;
2) Mr. Lopez is entitled to the payment of medical expenses, medication expenses, and transportation expenses, in accordance with law;
3) The two surgical procedures were reasonable and necessary and connected to the work-related injury of April 13, 2007;
4) Defendants have failed to authorize and reasonably controvert Mr. Lopez’s entitlement to the two surgical procedures, without good cause;
5) A penalty in the amount of $2,000.00 is assessed for failure to authorize the right shoulder surgery;
6) Another penalty in the amount of $2,000.00 is assessed for failure to authorize the left shoulder surgery;
7) Attorney fees are assessed in the amount of $4,000.00;
8) All costs and interest are to be paid by defendants, subject to a credit for any benefits paid by them, in accordance with law.

Marques has filed an appeal from the worker’s compensation judge’s Amended Judgment, and Mr. Lopez has filed an Answer to the Appeal.

LAW AND DISCUSSION

In its first assignment of error, Marques claims that the worker’s compensation judge erred in finding that Marques failed to authorize the right shoulder surgery without good cause, because the record does not contain any documentation from the treating physician or claimant requesting authorization for that surgery. In its second assignment of error, .Marques claims that the worker’s |,(Compensation judge erred in finding that Marques failed to authorize the left shoulder surgery without good cause, because the record does not contain any documentation from the treating physician or claimant requesting authorization for that surgery.

Marques claims that there is no documentation or other evidence that Dr. Fin-ney or Mr. Lopez requested authorization for either shoulder surgery and thus, he is limited to recovery of $750.00 for non-emergency treatment performed without the consent of the payor, pursuant to LSA-R.S. 23:1142(B)(1). Mr. Lopez responds that authorization for both surgeries was requested, but Marques failed to respond or authorize the surgeries. The parties stipulated that both shoulder surgeries were paid for by Mr. Lopez’s attorney.

The appellate court’s review of a workers’ compensation case is governed by the manifest error or clearly wrong standard. Bruno v. Harbert International, Inc., 593 So.2d 357, 361 (La.1992). This standard precludes setting aside a trial court’s finding of fact in the absence of manifest error or unless it is clearly wrong. Stobart v. State through Dept. of Transp. and Development, 617 So.2d 880, 882 (La.1993); Rosell v. ESCO, 549 So.2d 840, 844 (La.1989). In applying the manifest error standard, we need not determine whether the trier of fact was right or wrong, but whether the factfinder’s conclusion was a reasonable one. Stobart, 617 So.2d at 882; Seidl v. Zatarain’s, Inc., 05-780, p. 3, (La.App. 5 Cir. 3/28/06), 927 So.2d 557, 558-59. As the Louisiana Supreme Court has stated, “If the trial court or jury’s findings are reasonable in light 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.” Sistler v. Liberty Mutual Ins. Co., 558 So.2d 1106, 1112 (La.1990); Prevost v. Interior Gardens, Inc., 04-0274 at 3—4, (La.App. 4 Cir. 10/6/04), 887 So.2d 522, 524.

[,In the present case, Marques contends that neither Mr. Lopez nor his physician made a request for authorization for the right shoulder surgery performed in April 2008. It asserts that Mr. Lopez was seen by Dr. Finney in November 2007, and surgery to repair his right rotator cuff was scheduled for December 2007, though it was later cancelled. Mr. Lopez saw Dr. Finney again on March 21, 2008, and the right shoulder surgery was performed on April 3, 2008. Marques argues that no one sought authorization at any time prior to this surgery and that even Mr. Lopez admitted that he did not contact the worker’s compensation adjuster to seek authorization or inform her that the surgery had been scheduled. Marques asserts that there is no documentation or evidence in Dr. Finney’s records suggesting that authorization for this surgery was requested.

At trial, Waylon Lopez testified that although the right shoulder surgery was scheduled for December 27 or 28, 2007, it was cancelled because the physician did not receive payment for the surgery from the worker’s compensation provider. Mr. Lopez testified that his attorney requested authorization for the surgery in writing and attached medical records to the request. He admitted, however, that he did not see the written request for authorization for the right shoulder surgery. Mr. Lopez assumed that his attorney contacted the worker’s compensation adjuster to let her know that the surgery was re-scheduled for April 2008. Mr. Lopez also testified that a request for the left shoulder surgery was made, but it was not paid for by the worker’s compensation provider, so his attorney paid for this surgery as well.

A redacted copy of the worker’s compensation adjuster’s claims file was admitted into evidence without objection at the beginning of the trial. This file primarily contains copies of emails and notes pertaining to Mr. Lopez’s claim, and Rellene Graci was the adjuster primarily assigned to Mr. Lopez’s case. In Ms. Graci’s December 20, 2007 notes, she indicated that Mr. Lopez’s attorney was ^asking for authorization for surgery. On January 28, 2008, Rellene Graci noted that she held some medical documents “due to the request for surgery.” In a January 28, 2008 email to Cindy Gendron, who is the nurse case manager that was assigned to the case by the worker’s compensation adjuster, Ms. Graci wrote that Dr. Finney’s November 19, 2007 records indicate that he recommended surgery. She stated that she did not think the surgery had been done yet, because Mr. Lopez’s attorney “is now requesting we approve it.” She then asked Ms. Gendron to let her know if she saw any reason that the right shoulder surgery should not be approved. She also noted that Dr. Steiner said arthroscopy of the right shoulder would be appropriate, but there was still a question as to whether Dr. Steiner or Dr. Finney recommended left shoulder surgery.

Ms. Graci’s notes from August 26, 2008 indicate that she spoke with Mr. Lopez’s attorney, who indicated that Mr. Lopez had already had the right rotator cuff surgery and that he was scheduled for another surgery on August 28, 2008. She stated that she informed Mr. Lopez’s attorney that there were questions of causation and Dr. Finney would not meet with them, so that is the main reason that the surgery was not approved. It is unclear whether she was referring to the right or left shoulder surgery.

The nurse case manager, Cindy Gen-dron, testified that as of December 31, 2007, she was not aware that any request for surgery had been made by Mr. Lopez.

Based on her findings, the worker’s compensation judge apparently believed that requests for right and left shoulder surgeries had been made and were denied or ignored. Considering the evidence presented, we cannot say that the worker’s compensation judge was manifestly erroneous in these findings. Accordingly, we find that the first and second assignments of error are without merit.

17In its third assignment of error, Marques contends that the worker’s compensation judge erred in not limiting the amount to be paid for the shoulder surgeries to $750.00, as required by LSA-R.S. 23:1142(B), because they were for non-emergency treatment without prior authorization. Marques argues that the lack of a request for authorization for the shoulder surgeries triggers the provisions of LSA-R.S. 23:1142(B), and the employer can be held to pay no more than $750 for the surgeries. However, because we cannot say the worker’s compensation judge was manifestly erroneous in finding that Mr. Lopez did seek authorization for the shoulder surgeries, this argument is without merit. LSA-R.S. 23:1203 requires the employer to pay all necessary and reasonable medical expenses. Scuderi v. Crazy Johnnie Cafe, Inc., 02-243 (La.App. 5 Cir. 10/16/02), 831 So.2d 1037, 1045. The worker’s compensation judge found the two surgeries to be reasonable and necessary and connected to the work-related accident.

In its fourth assignment of error, Marques argues that the worker’s compensation judge erred in assessing penalties for the failure of the employer to authorize the two shoulder surgeries, because LSA-R.S. 23:1142(D) does not | ¡¡provide for the provision of penalties. However, LSA-R.S. 23:1201 allows for the imposition of penalties for failure to pay worker’s compensation benefits when the claim is not reasonably controverted. In the present case, the worker’s compensation judge did not indicate that penalties were imposed pursuant to LSA-R.S. 23:1142.

One purpose of the workers’ compensation statutes is to promptly provide compensation and medical benefits to an employee who suffers injury within the course and scope of employment. Authement v. Shappert Engineering, 02-1631, p. 8, (La.2/25/03), 840 So.2d 1181, 1187. The employer is obligated to “furnish all necessary drugs, supplies, hospital care and services, medical and surgical treatment, and any nonmedical treatment recognized by the laws of this state as legal.” Id.; LSA-R.S. 23:1203(A). A failure to authorize treatment can result in the imposition of penalties and attorney fees except when the claim is reasonably controverted. Depending on the circumstances, a failure to authorize treatment is effectively a failure to furnish treatment. Authement, 02-1631 at 8, 840 So.2d at 1187.

The failure to authorize a medical procedure for an employee otherwise eligible to receive workers’ compensation is deemed to be the failure to furnish compensation benefits, thereby subjecting the employer to an assessment of attorney fees and penalties, unless the claim is reasonably controverted or such nonpayment results from conditions over which the employer had no control. LSAR.S. 23:1201; Sims v. BFI Waste Services, L.L.C., 06-1319, p. 11 (La.App. 1 Cir. 5/16/07), 964 So.2d 998, 1005. To determine whether a claim has been reasonably controverted, thereby precluding imposition of penalties and attorney’s hfees, a court must ascertain whether the employer or insurer engaged in a nonfrivolous legal dispute or possessed factual or medical information to reasonably counter the factual and medical information presented by the claimant throughout the time the employer/insurer refused to pay all or part of the benefits allegedly owed. Brown v. Texas-LA Cartage, Inc., 98-1063 (La.12/1/98), 721 So.2d 885, 890; Sevin v. Chevrolet, 08-1362, p. 15 (La.App. 1 Cir. 4/30/09), 24 So.3d 879, 889.

The testimony and evidence in the record before us shows that Marques and its insurer apparently had a difficult time obtaining all of the medical records they sought. Nevertheless, Marques did not dispute that a work-related accident occurred and that his claim for worker’s compensation benefits was compensable. Further, the record shows that Marques and its insurer had medical records indicating that the shoulder surgeries were recommended. The record does not show that Marques or its insurer had factual or medical information to reasonably counter the medical information presented by the claimant when they refused to authorize the surgeries.

Accordingly, considering the record before us, we cannot say that the worker’s compensation judge erred in assessing penalties against defendants for failing to authorize the two surgeries.

Finally, in its fifth assignment of error, Marques contends that the worker’s compensation judge erred in applying the incorrect standard for assessing attorney fees under LSA-R.S. 23:1142. The worker’s compensation judge found that the employer failed to authorize the surgeries “without good cause,” but LSA-R.S. 23:1142(D) provides that the court may award attorney fees when it is determined Imthat “the withholding of such consent was arbitrary and capricious, or without probable cause.”

Although the worker’s compensation judge found that defendants failed to authorize the surgical procedures “without good cause,” she also stated that they failed to reasonably controvert the claim. As stated above, attorney fees and penalties are authorized when an employer fails to authorize a medical procedure and the claim is not reasonably controverted. Further, if the worker’s compensation judge found that defendants failed to authorize the surgeries “without good cause,” it stands to reason that she did not find there to be “probable cause” for failure to authorize the surgeries.

Accordingly, we find this argument by Marques to be unpersuasive and without merit.

On April 21, 2001, Mr. Lopez filed an Answer to Appeal, seeking an increase in the amount of penalties and attorney fees awarded, additional penalties and attorney fees for failure to pay for a discogram, and additional attorney fees and costs for this appeal. However, based on the record before us, we find that Mr. Lopez has not shown that he is entitled to the relief sought.

DECREE

For the foregoing reasons, we affirm the worker’s compensation judge’s November 22, 2010 Amended Judgment. We deny Mr. Lopez’s requests in his Answer to Appeal.

AFFIRMED.

      . LSA-R.S. 23:1142(B) provides:
      (1) Except as provided herein, each health care provider may not incur more than a total of seven hundred fifty dollars in nonemergen-cy diagnostic testing or treatment without the mutual consent of the payor and the employee as provided by regulation. Except as provided herein, that portion of the fees for non-emergency services of each health care provider in excess of seven hundred fifty dollars shall not be an enforceable obligation against the employee or the employer or the employer's workers’ compensation insurer unless the employee and the payor have agreed upon the diagnostic testing or treatment by the health care provider.
      (2)(a) When the payor has agreed to the diagnostic testing or treatment, the health care provider shall not issue any demand for payment to the employee or his family until the payor denies liability for the diagnostic testing or treatment. Notwithstanding the foregoing, the health care provider may reasonably communicate with the employee or his attorney or representative for the purpose of pursuing its claim against the payor.
      (b) A health care provider who knowingly and willfully violates this Paragraph may be ordered by the workers’ compensation judge to pay penalties not to exceed two hundred fifty dollars per violation plus reasonable attorney fees. The penalty shall not exceed one thousand dollars for any demand for payment to an employee or his family which is issued after the health care provider has been penalized for a previous demand for payment to that employee or his family.

      . LSA-R.S. 23:1142(D) provides:
      If the payor has not consented to the request to incur more than a total of seven hundred fifty dollars for any and all non-emergency diagnostic testing or treatment when such consent is required by this Section, and it is determined by a court having jurisdiction in an action brought either by the employee or the health care provider that the withholding of such consent was arbitrary and capricious, or without probable cause, the employer or the insurer shall be liable to the employee or health care provider bringing the action for reasonable attorney fees related to this dispute and to the employee for any medical expenses so incurred by him for an aggravation of the employee’s condition resulting from the withholding of such health care provider services.


author: CLARENCE E. McMANUS, Judge.

text:
    Terence CZOP v. Ervin WHITE, Jr. and Pathfinder Insurance Company. Ryder Truck Rental, Inc., Ryder Transportation Services v. Ervin White Jr., Avis Rent A Car System, LLC, Pathfinder Insurance Company.
    Nos. 11-CA-310, 11-CA-311.
    Court of Appeal of Louisiana, Fifth Circuit.
    Dec. 28, 2011.
    Rehearing Denied Jan. 24, 2012.

      Robert W. Drouant, Attorney at Law, New Orleans, LA, John J. Lee, Jr., Attorney at Law, Metairie, LA, for Plaintiff/Appellant.
    Thomas M. Young, Hebbler & Giordano, Attorney at Law, Metairie, LA, for Defendant/Appellees Avis Rent A Car System and Pathfinder Insurance Company.
    John W. Penny, Attorney at Law, Lafayette, LA, for PlaintiffAppellant Ryder Truck Rental, Inc. and Defendant/Appellee Old Republic Insurance Company.
    Panel composed of Judges SUSAN M. CHEHARDY, CLARENCE E. McMANUS, and WALTER J. ROTHSCHILD.
   CLARENCE E. McMANUS, Judge.

|3Plaintiffs, Terence Czop and Ryder Truck Rental, Inc., appeal the granting of summary judgment and dismissal of all claims against Pathfinder Insurance Company and Avis Rental Company. For the reasons which follow, we reverse the trial court’s judgment.

STATEMENT OF THE CASE

On June 2, 2008, Terence Czop was involved in an automobile accident while driving a 2001 International tractor, owned by Ryder Truck Rental, Inc. and insured by Old Republic Insurance Company, on 1-10 westbound in Jefferson Parish. Czop was an employee of Moon’s Towing Service, Inc. and was dispatched to service the tractor. Moon’s Towing maintained insurance coverage with Praetorian Specialty Insurance Company. While driving the tractor to remove it from the shoulder of the interstate, Czop was hit by a vehicle being operated by Ervin White, Jr. Czop was in the far right lane of the interstate. White was in the far left lane and he then crossed all lanes of travel and struck the tractor driven by Czop. White was driving a 2008 Ford 150 truck, owned by Avis Rental Company. Avis maintained liability insurance coverage for its rental cars with Pathfinder Insurance Company. White was intoxicated at the time of the accident, and was thereafter charged with reckless operation of a motor vehicle and driving while intoxicated. He later pled guilty to these charges.

On May 19, 2009, Czop filed suit against White and Pathfinder seeking damages for the injuries he sustained in the accident. On June 1, 2009, Ryder Truck Rental, Inc. and Ryder Transportation Services also filed a petition for |4damages against White, Avis Rental Car System, and Pathfinder. On August 26, 2009, these two cases were consolidated in the trial court.

On May 7, 2010, Avis and Pathfinder filed a motion for summary judgment. They argued that White was operating the vehicle while intoxicated at the time of the accident and, therefore, he had violated the rental car agreement which automatically terminated the agreement and voided all liability protection. Defendants argued that Avis was the named insured and provided liability protection to authorized drivers who used the rental vehicles in accordance with the terms of the rental agreement. The policy defined an insured to include anyone, other than the named insured Avis, using a covered auto with permission. Defendants argued that White’s reckless operation of the vehicle under the influence of alcohol violated the rental agreement and voided any coverage under the Pathfinder policy.

Avis and Pathfinder further argued that Czop had uninsured/underinsured motorist (“UM”) coverage under Ryder’s Old Republic policy and under Moon’s Towing’s Praetorian policy. Each has a rejection form, rejecting uninsured/underinsured coverage, but Avis and Pathfinder argued these forms were invalid and, therefore, there was UM coverage. Since defendants argued that Czop had no coverage under Avis’ policy, they alleged he’s entitled to UM coverage under Ryder and Moon’s Towing’s policies.

On June 1, 2001, Czop filed a supplemental petition for damages adding Old Republic Insurance Company, Ryder’s insurer, Praetorian Specialty Insurance Company, Moon’s Towing’s insurer, and GEICO, Czop’s insurer, as defendants. On September 27, 2010, Old Republic filed a motion for summary judgment arguing the Old Republic policy affords no UM coverage to Ryder, so Old Republic asserted it was entitled to summary judgment. Old Republic contended |fithe rejection form it executed was valid in form, so rejection of coverage was chosen and initialed by the senior director of insurance operations for Ryder.

All motions for summary judgment were heard in the trial court on October 12, 2010. On October 27, 2010, the trial court issued a judgment granting the motions for summary judgment in favor of Pathfinder, Old Republic, Praetorian, and Avis. The trial court dismissed all claims of plaintiffs against these defendants. Thereafter, the trial court issued a judgment dismissing all claims of Czop against GEICO.

Czop and Ryder now appeal the October 27, 2010 judgment of the trial court granting the motion for summary judgment in favor of Avis and Pathfinder.

DISCUSSION

Czop and Ryder appeal the granting of summary judgment and the dismissal of their claims against Pathfinder and Avis. On appeal, Czop argues the trial court erred in denying that the Pathfinder liability policy provided liability coverage in this case. Czop argues that the trial court should have applied statutory and public policy law on omnibus clauses, to provide liability. Further, Czop contends that White never actually signed the rental agreement, therefore, the terms do not apply. Czop also argues that the terms and conditions in the rental agreement would bar coverage for even a simple traffic citation and, thus, the terms of the rental agreement are ambiguous, unconscionable, and unenforceable. Czop further argues that White did not give consent to an adhesion contract. And finally, Czop contends there are genuine issues of material fact. Ryder also appeals the trial court’s granting of summary judgment in favor of Pathfinder and Avis, and adopts the arguments of Czop.

Appellate courts review grants of summary judgment de novo, using the same criteria that govern trial court’s consideration of whether summary judgment 14s appropriate, i.e. whether there is a genuine issue of material fact and whether the mover is entitled to judgment as a matter of law. Champagne v. Ward, 2003-3211 (La.1/19/05), 893 So.2d 773. In this case, we find the trial court erred in granting summary judgment in favor of Pathfinder and Avis.

In their motion for summary judgment, Avis and Pathfinder argued that the rental agreement signed by White was automatically terminated when he violated the terms of the agreement by driving while intoxicated. Avis and Pathfinder argue that because the agreement was terminated due to a prohibited use of the vehicle, the liability protection for the vehicle was also terminated. The rental agreement provided that Avis was the named insured who provided liability protection to authorized drivers who used rental vehicles in accordance with the terms of the rental agreement. Avis and Pathfinder contend that White’s operation of the vehicle recklessly and under the influence of alcohol violated the rental agreement and voided any coverage under the Pathfinder policy.

Paragraph 5 of the rental agreement, in pertinent part, provided the following:

15. Prohibited Use of the Car. Certain uses of the car and other things you or a driver may do, or fail to do, will violate this agreement. A VIOLATION OF THIS PARAGRAPH, WHICH INCLUDES USE OF THE CAR BY AN UNAUTHORIZED DRIVER, WILL AUTOMATICALLY TERMINATE YOUR RENTAL, VOID ALL LIABILITY PROTECTION AND ANY OPTIONAL SERVICES THAT YOU HAVE ACCEPTED, INCLUDING ADDITIONAL LIABILITY INSURANCE, PERSONAL ACCIDENT INSURANCE, PERSONAL EFFECTS PROTECTION AND LOSS DAMAGE WAIVER OR PARTIAL DAMAGE WAIVER. IT ALSO MAKES YOU LIABLE TO U.S. FOR ALL THE PENALTIES, FINES, FORFEITURES, LIENS AND RECOVERY AND STORAGE COSTS, INCLUDING ALL RELATED LEGAL EXPENSES, FEES AND COSTS.
|7It is a violation of this paragraph if:
A. You use or permit the car to be used: 1) by anyone other than the authorized driver, as defined in paragraph 16; 2) to carry passengers or property for hire; 3) to tow or push anything; 4) to be operated in a test, race or contest or on unpaved roads; 5) while the driver is under the influence of alcohol or a controlled substance; 6) for conduct that could properly be charged as a felony or misdemeanor, including the transportation of a controlled substance or contraband; 7) recklessly or while overloaded; 8) if rented in the United States, outside of the United States, or with our permission, Canada; or 9) if rented in Canada, outside Canada, or with our permission, the United States; or ...

(Emphasis in original)

It is Avis and Pathfinder’s contention, and the trial court agreed, that White violated this paragraph of the rental agreement by driving while intoxicated and thus, the rental agreement was terminated and all liability protection was voided. We disagree.

LSA-R.S. 22:1296 governs insurance coverage for temporary, substitute, and rental vehicles. LSA-R.S. 22:1296(B) provides that a rental company shall maintain security on all rental vehicles meeting the requirements of the Motor Vehicle Safety Responsibility Law, R.S. 32:851, et. seq. The purpose of this statutory requirement is to protect the victim injured due to the fault of the driver of the rental vehicle. In accordance with LSA-R.S. 22:1296, Avis was required to provide insurance coverage on all rental vehicles, including the truck in question in this case. Paragraph 17 of the rental agreement addresses this requirement and provides, in part:

17. Liability Protection. Anyone driving the car that is permitted to drive it by this agreement will be protected against liability for causing bodily injury or death to others or damaging the property of someone other than the driver and/or the renter up to the minimum financial responsibility limits required by the law of the jurisdiction in which the accident occurs ...

1 sAvis did provide liability protection for the vehicle rented to White, as required by LSA-R.S. 22:1296 and stated in paragraph 17 of the rental agreement. However, Avis now attempts to terminate that liability protection due to a violation of the rental agreement. We agree with Czop and Ryder and find the terms of the rental agreement relied upon by Avis as a basis for termination of liability protection to be ambiguous and unconscionable. Czop and Ryder are correct in their assertion on appeal that a mere traffic violation could arguably be a violation of the rental agreement resulting in termination of the rental agreement and termination of liability coverage. Louisiana law clearly requires insurance coverage even on rental vehicles and we believe that to allow termination of coverage based on a violation of the rental agreement is against public policy. We find Avis and Pathfinder are not entitled to summary judgment in this matter.

We further note that Czop and Ryder are also correct in their assertion that the rental agreement, provided as an exhibit and attached to the memorandum in support of the motion for summary judgment, is not signed by White and provides no indication that he actually agreed to its terms. White’s name does not appear on the document and the document is not dated. Thus, we also find genuine issues of material fact regarding the actual rental agreement entered into by White.

For the reasons discussed above, we find summary judgment is not appropriate in this case. We reverse the trial court’s granting of summary judgment in favor of Pathfinder and Avis and remand this matter to the trial court for further proceedings.

REVERSED