author: GAIDRY, J.

text:
    ASP ENTERPRISES, INC. v. Kevin J. GUILLORY, Terry Guillory, Eunice M. Langhauser, and Parish National Bank.
    No. 2008-CA-2235.
    Court of Appeal of Louisiana, First Circuit.
    Sept. 11, 2009.
    Rehearing Denied Oct. 16, 2009.

      Claude F. Reynaud, Jr., Stephen F. Chiccarelli, Jeanne C. Comeaux, Eric B. Landry, Baton Rouge, Louisiana, for Plaintiff/Appellant, ASP Enterprises, Inc.
    Roy E. Blossman, Robert S. Stassi, Lucas T. Regnier, New Orleans, Louisiana, for Defendant/Appellee, Parish National Bank.
    David J. Boneno, Baton Rouge, Louisiana, for Amicus Curiae Louisiana Bankers Association.
    Before KUHN, GUIDRY, and GAIDRY, JJ.
   GAIDRY, J.

|PA close corporation that was the victim of alleged forgery and theft by a former employee appeals a summary judgment dismissing its claims against the bank at which it maintained its checking account. For the following reasons, we affirm.

FACTUAL AND PROCEDURAL BACKGROUND

ASP Enterprises, Inc. (ASP), doing business as Action Screen Printers, is a corporation primarily engaged in the business of silk screen printing in Covington, Louisiana. At the times relevant to this matter, its president and sole stockholder was Sidney Guillot, and its secretary-treasurer was his wife, Blanch Guillot. ASP’s business premises were situated on the same property on which the Guillots’ family residence was located.

ASP maintained a checking account at Parish National Bank (the Bank) in Cov-ington. Mr. and Mrs. Guillot were the authorized signatories for the checking account.

Around 1989, ASP hired Terry Guillory as a commission salesman. Sometime around 1993 or 1994, Mr. Guillot began to experience multiple health problems that by 1996 prevented him from working in his business on a daily basis. Terry Guillory gradually assumed various managerial duties due to the frequent absences of Mr. and Mrs. Guillot, eventually assuming full control of the business’s financial affairs and daily operations. At some point around that time, apparently due to cash flow problems and overdrafts of its checking account, the business adopted the policy of issuing money orders to pay its creditors rather than issuing checks drawn on its demand deposit accounts.

[ ^According to ASP, Terry Guillory began to embezzle money from ASP through a number of methods, including forging Mrs. Guillot’s name on checks drawn on ASP’s checking account (the forged ASP checks) for cash or to purchase money orders, and indorsing and cashing third-party customer checks payable to ASP (the third-party checks). According to ASP, Terry Guillory also created fictitious payee invoices, including some for a fictitious entity named “Goodbee Screen Printers,” billing ASP customers for jobs actually performed by ASP, cashing checks payable to the fictitious payees, and retaining the proceeds. Many, if not all, of the ASP and third-party checks were cashed or processed at the Goodbee Quick Stop (Goodbee), a convenience store co-owned by Kevin Guillory, Terry Guillory’s brother, and Eunice Langhauser, the Guillorys’ mother. Goodbee also maintained a checking account at the Bank, from which Goodbee obtained large sums of cash for use in its check-cashing business operations. Terry Guillory had no account at the Bank.

In the summer of 2003, Terry Guillory left his employment with ASP after a verbal altercation with the Guillots’ son, Ryan Guillot, who had begun working at ASP a year or more prior to that time. According to an affidavit of Sidney Guillot, in July 2003 he discovered that a supposedly unpaid invoice to a customer had in fact been paid by check, but that the check had been cashed at Goodbee and then deposited in Goodbee’s account at the Bank. Mr. Guillot made further inquiries and determined that other third-party checks had been similarly handled, and that Mrs. Guillot’s signature had been forged on many ASP checks.

On December 15, 2003, ASP filed a petition for damages, naming as defendants Terry Guillory, Kevin J. Guillory, Eunice M. Langhauser, and the Bank. ASP alleged that after Mr. Guillot became ill and Mrs. Guillot 14attempted to conduct the business, Terry Guillory “seized the opportunity to expand his apparent control of the business operations.” (Emphasis added.) ASP also alleged that in doing so, Terry Guillory “eventually took it upon himself to purchase materials, contract with customers, create and invoice customers for work performed, accept payments for work performed, and sundry other functions.” (Emphasis added.) ASP alleged that Kevin Guillory, as Terry Guillory’s brother and as Goodbee’s manager, was aware that Terry Guillory was converting ASP’s assets for his personal use. ASP further alleged that both Good-bee and the Bank knew or should have known of Terry Guillory’s alleged embezzlement.

The Bank answered ASP’s petition, denying its liability and asserting a cross-claim against the other defendants for indemnity. Terry Guillory answered the petition and cross-claim, denying his liability, and in turn asserted a reconventional demand against ASP and a third-party demand against Sidney Guillot, claiming unpaid wages and breach of a contract to convey an ownership interest in ASP.

On July 24, 2006, ASP filed a supplemental and amended petition, reiterating the allegations of its original petition, but adding allegations and asserting causes of action against all defendants under the federal Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. § 1961, et seq. and for conversion under Louisiana law, against Terry Guillory for breach of fiduciary duty, and against the Bank for negligence under Louisiana law.

On January 7, 2008, the Bank filed two motions for partial summary judgment. One motion addressed ASP’s claims against the Bank governed by the Louisiana Uniform Commercial Code (UCC), La. R.S. 10:1-101, et seq. (the UCC motion). The other addressed ASP’s claims against the Bank under RICO (the RICO motion).

lijTVte Trial Court’s Action

The Bank’s motions for partial summary judgment were heard by the trial court on February 25, 2008. On March 11, 2008, the trial court issued its combined “Reasons for Judgment and Judgment,” granting both the UCC motion and the RICO motion. However, the judgment did not contain decretal language dismissing the UCC and RICO claims against the Bank, dismissing the Bank as a defendant, or designating either partial summary judgment as final and appealable under La. C.C.P. art. 1915(B). In its reasons for judgment, the trial court noted with regard to the checks drawn on ASP’s account that the Bank was “under no duty to furnish copies of the checks with the bank statements,” and that Mr. Guillot offered no evidence in his affidavit of the date he requested copies of the checks that he claimed the Bank supposedly delayed in producing to him. As to the third-party checks payable to ASP, the trial court found that “[n]o affidavits or other evidence was presented by [ASP] which questioned the [Blank’s operating procedures and there was no evidence that the Bank had notice that Terry Guillory was forging or wrongly [sic ] endorsing company checks.”

On April 28, 2008, the Bank filed a “Motion for Clarification and Motion to Designate Judgment as Final,” seeking clarification óf the decretal effect and finality of the judgment of March 11, 2008, granting the Bank’s UCC motion and RICO motion. On May 30, 2008, the trial court signed a judgment denying the former motions. Thereafter, the Bank filed a new motion for summary judgment, expressly seeking the dismissal of all of LASP’s claims against the Bank. The Bank’s new motion for summary judgment was heard on June 30, 2008, and was granted by judgment signed on July 11, 2008, dismissing with prejudice all claims of ASP against the Bank.

ASP now appeals. An amicus curiae brief has also been submitted by the Louisiana Bankers Association.

ASSIGNMENTS OF ERROR AND ISSUES ON APPEAL

ASP contends that the trial court committed error in the following described respects:

1. The trial court erred in assuming or finding that [the Bank], as depository bank, was a holder, under La. R.S. 10:1-201(21), or a holder-in-due-course under La. R.S. 10:3-302(1) and (2), of the checks at issue;
2. The trial court erred in granting [the Bank], as a mere transferee, any rights against ASP greater than its transferor had under La. R.S. 10:3-201(b);
3. If [the Bank] only succeeds to the rights of a criminal co-conspirator, the trial court erred in allowing [the Bank] to benefit from the safe harbor protections of negotiable instrument laws such as ... comparative negligence, prescription, burden-shifting and statutory presumptions.
4. The trial court committed reversible error when it found that no evidence existed that [the Bank] had any notice that Terry Guillory, an employee of ASP [,] was forging or wrongfully endorsing company checks.
5. The trial court committed reversible error when it found that [the Bank] observed reasonable commercial standards as the depositary and drawer bank.
6. The trial court committed reversible error when it concluded that no evidence existed to support ASP’s claim that [the Bank] failed to maintain or apply its bank account |7oversight and maintenance procedures in a commercially reasonable manner.
7. The trial court committed reversible error when it failed to distinguish and analyze the different factual methods employed by Terry Guillory to embezzle from ASP.
8. The trial court committed reversible error when it failed to apply the applicable [UCC] provisions to each of the distinct methods of embezzlement ... and how each method, under La. R.S. 10:3-101, et seq., invoked different statutory liability and, in turn, different statutory presumptions and defenses.
9. The trial court committed reversible error when it concluded that because ASP failed to supervise its financial affairs by entrusting the majority of day-to-day management ... to its employee, Terry Guillory, the risk of loss caused by his fraudulent endorsements should be exclusively borne by ASP.
10. The trial court erred in granting ... summary judgment as to the issue of prescription.
11. The trial court erred in declining to apply the doctrine of contra non va-lentem.
12. The trial court erred in granting [the Bank’s] [m]otion for [s]ummary Q]udgment and exception of prescription, as to the [UCC] claims.
[13.] The trial court erred in granting [the Bank’s] [m]otion for [s]ummary [¡Judgment as to all remaining claims.

In addition to the issues inherent in the foregoing assignments of error, ASP raises the following legal issues for our review:

[1.] Should this Court reexamine its ruling in Peak Performance Physical Therapy & Fitness, LLC v. Hibernia Corp., [07-2206 (La.App. 1st Cir.6/6/08), 992 So.2d 527, writ denied, 08-1478 (La.10/3/08), 992 So.2d 1018], that in applying the prescriptive period of La. R.S. 10:3-420(f) (conversion of funds) the principle of contra non valentem should only apply if there is “fraudulent concealment” by the depository or drawer bank?
[2.] Did the trial court err in concluding that the causes of action under the [UCC] supplant all additional claims and causes of action which ASP may have against [the Bank]?

The Bank frames the issues before us in terms of the defenses it raised to the claims for the third-party checks under La. R.S. 10:3-405(b) and La.|«R.S. 10:3-420(1). As to the forged ASP checks, the Bank frames the issues in terms of its defenses under La. R.S. 10:4-406(d)(2), 4-406(f), and 4-111.

Finally, both the Bank and the amicus curiae urge us to reaffirm the relevant holding in Peak Performance, supra, which strictly limited application of contra non valentem.

STANDARD OF REVIEW: SUMMARY JUDGMENT

This matter comes to us on appeal from a summary judgment, effectively dismissing a defendant from the action. It is therefore subject to de novo review as to whether summary judgment was appropriate. Motorola, Inc. v. Associated Indem. Corp., 02-0716, p. 5 (La.App. 1st Cir.6/25/04), 878 So.2d 824, 828, writs denied, 04-2314, 04-2323, 04-2326, 04-2327 (La.11/19/04), 888 So.2d 207, 211, 212. In undertaking our de novo review, we employ the same standards applicable to the trial court’s determination of the issues. Peak Performance Physical Therapy & Fitness, LLC v. Hibernia Corp., 07-2206, p. 5 (La.App. 1st Cir.6/6/08), 992 So.2d 527, 530, writ denied, 08-1478 (La.10/3/08), 992 So.2d 1018.

The summary judgment procedure is expressly favored in the law, and is designed to secure the just, speedy, and inexpensive determination of nondomestic civil actions. La. C.C.P. art. 966(A)(2). Summary judgment is appropriate if the pleadings, depositions, answers to interrogatories, admissions, and affidavits in the record show that there is no genuine issue as to material fact, and that the mover is entitled to judgment as a matter of law. La. C.C.P. art. 966(B). Louisiana Code of Civil Procedure article 967(A) provides that “[supporting and opposing affidavits shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated therein.”

RThe mover has the burden of proof that he is entitled to summary judgment. See La. C.C.P. art. 966(C)(2). If the mover will not bear the burden of proof at trial on the subject matter of the motion, he need only demonstrate the absence of factual support for one or more essential elements of his opponent’s claim, action, or defense. See La. C.C.P. art. 966(C)(2). If the moving party points out that there is an absence of factual support for one or more elements essential to the adverse party’s claim, action, or defense, then the nonmov-ing party must produce factual support sufficient to satisfy his evidentiary burden at trial. See La. C.C.P. art. 966(C)(2). If the mover has put forth supporting proof through affidavits or otherwise, the adverse party may not rest on the mere allegations or denials of his pleading, but his response, by affidavits or otherwise, must set forth specific facts showing that there is a genuine issue for trial. La. C.C.P. art. 967(B).

DISCUSSION

Holder in Due Course Status

ASP’s first three designated assignments of error present the question of the Bank’s alleged status as a mere “transferee” under La. R.S. 10:3-203, as opposed to status as a “holder in due course” under La. R.S. 10:3-301, et seq., and La. R.S. 10:4-205. As correctly emphasized by the Bank and the amicus curiae, the issues and arguments relating to “holder in due course” status were never raised or submitted to the trial court for determination. Our jurisprudence has a longstanding general rule that issues not submitted to the trial court for decision will not be considered for the first time on appeal. Judson v. Davis, 04-1699, p. 23 (La.App. 1st Cir.6/29/05), 916 So.2d 1106, 1121, writ denied, 05-1998 (La.2/10/06), 924 So.2d 167. See also Rule 1-3, Uniform Rules of Louisiana Courts of Appeal.

11 nIn its reply brief, ASP implicitly acknowledges that the issues relating to “holder in due course” status were not addressed at the trial court level. Nevertheless, it urges us to review these issues under Rule 1-3’s exception that authorizes review of issues not submitted to the trial court if “the interest of justice clearly requires” such review. After considering the nature of the issues and ASP’s related arguments, we conclude that such review is inappropriate and pretermit consideration of ASP’s first three assignments of error.

The Checks at Issue

The record of this matter contains photocopies of a large number of third-party checks payable to ASP, checks written on ASP’s checking account at the Bank, and money orders cashed at Goodbee. However, many of those documents were simply attached as in globo exhibits to various memoranda of the parties, without verification by affidavit, deposition, admissions, or answers to interrogatories.

A party may not utilize unsworn and unverified documents as summary judgment evidence. Sanders v. J. Ray McDermott, Inc., 03-0064 p. 4 (La.App. 1st Cir.11/7/03), 867 So.2d 771, 775. A document which is not an affidavit or sworn to in any way, or which is not certified or attached to an affidavit, is not of sufficient evidentiary quality to be given weight in determining whether there are remaining genuine issues of material fact. Id.; Robertson v. Northshore Reg’l Med. Center, 97-2068, pp. 5-6 (La.App. 1st Cir.9/25/98), 723 So.2d 460, 464. Likewise, an unsworn, uncertified document simply attached to a memorandum may not properly be considered by the court in determining a motion for summary judgment. State v. Exxon Corp., 95-2501, pp. 7-8 (La.App. 1st Cir.6/28/96), 676 So.2d 783, 787.

After careful review of the record, as well as the parties’ briefs, it appears undisputed that the checks at issue form part of a set of documents Bates-stamped A0001 through A0310, identified by ASP in its answers to interrogatories as the checks forming the basis of its claims. The third-party checks are contained in that portion of documents numbered A0001 through A0187 (although some ASP checks are also contained therein), and ASP’s checks that were allegedly forged (with the exception of those mentioned above) are contained in the remaining documents numbered A0188 through A310.

The Third-Party Checks

Louisiana Revised Statutes 10:3-420 provides, in pertinent part:

(a) An instrument is converted when
(iii) it is taken by transfer, other than a negotiation, from a person not entitled to enforce the instrument or a bank makes or obtains payment with respect to the instrument for a person not entitled to enforce the instrument or receive payment.
(f) Any action for conversion ... prescribes in one year.

Terry Guillory’s alleged actions relating to the third-party checks payable to ASP and the third-party checks payable to fictitious payees |12clearly constituted conversions under La. R.S. 10:3 — 420(a)(iii). If ASP’s allegations as to the Bank’s actions are accepted as true, then those actions in accepting the deposits of the misappropriated checks and thereby making payment to Goodbee would also constitute conversions within the meaning of the statute. See Peak Performance, 07-2206 at p. 7, 992 So.2d at 531, and Med Data Serv. Bureau, L.L.C. v. Bank of La. in New Orleans, 03-2754, pp. 9-10 (La.App. 1st Cir.12/20/04), 898 So.2d 482, 488-89.

The Bank established a prima facie case of prescription of all claims for conversion based upon the third-party checks deposited prior to December 15, 2002, a year prior to filing of suit. See Quality Gas Products, 03-1859 at pp. 5-6, 885 So.2d at 1182, and Metro Elec. & Maint, Inc. v. Bank One Corp., 05-1045, pp. 4-8 (La.App. 3rd Cir.3/1/06), 924 So.2d 446, 449-51. The Bank having established a prima facie case of prescription as to the checks cashed at Goodbee and deposited over a year prior to suit being filed, the burden of proof that those claims were not prescribed shifted to ASP. As the party asserting the benefit of contra non valentem, ASP bore the burden of proof of its requisite elements and applicability. See Black v. Whitney Nat’l Bank, 618 So.2d 509, 516 (La.App. 4th Cir.), writ denied, 623 So.2d 1308 (La.1993).

At this point, it is appropriate that we address ASP’s last assignment of error, as its determination bears upon the nature of ASP’s cause of action 11sfor conversion and the applicability of the general doctrine of contra non valentem relating to that cause of action. This assignment of error addresses the issue of whether ASP may properly assert causes of action against the Bank under Louisiana law, independent of the UCC, for conversion and negligence. In other words, ASP contends that the trial court erred in implicitly concluding that any such non-UCC causes of actions were supplanted or displaced by the UCC provisions addressing such theories of recovery. See La. R.S. 10:1 — 103(b). The resolution of this issue directly affects whether ASP may invoke the doctrine of contra non valentem to defeat the Bank’s defense of prescription relating to ASP’s reimbursement claim based upon the third-party checks.

In Peak Performance, although we did not expressly invoke the “displacement” concept embodied in La. R.S. 10:l-103(b), we implicitly rejected the plaintiffs theory of recovery that the defendant bank “passively allowed” the embezzlement by the plaintiffs employee of third-party checks payable to the plaintiff. Instead, we correctly recognized its cause of action as one for conversion under La. R.S. 10:3-420. Peak Performance, 07-2206 at p. 7, 992 So.2d at 531. We emphasized in that opinion that “Louisiana follows the model of the [UCC] in characterizing the nature of the conversion action....” Id., 07-2206 at p. 10, 992 So.2d at 532. Citing Pargas, Inc. v. Estate of Taylor, 416 So.2d 1358, 1364-65 (La.App. 3rd Cir.1982), we observed that “UCC provisions should be construed so that rights and liabilities of the parties, absent serious factual dispute, are ascertainable without resort to expensive and delaying litigation over each item that might |]4be paid on an unauthorized signature or endorsement, thereby facilitating commercial transactions.” Id., 07-2206 at p. 11, 992 So.2d at 533.

Nationwide, in cases involving check fraud, “a large number of courts refuse to allow any general common law claims, conversion claims, or negligence actions when not expressly authorized by the U.C.C.” A. Brooke Overby, Check Fraud in the Courts After the Revisions to U.C.C. Articles 3 and 4, 57 Ala. L.Rev. 351, 391-92 (2005). (Footnotes omitted.) Any uncertainty as to the viability of such non-UCC actions “significantly raises the cost of litigation, generates unpredictable results, and can reduce incentives for corporate officers to supervise and control their employees.” Id. at 397. Such uncertainty would be contrary to the UCC’s goals of simplicity, clarity, and uniformity. See La. R.S. 10:1-103(a).

Given the foregoing considerations, we conclude that ASP’s claims for conversion and negligence grounded in general Louisiana law outside the ambit of the UCC are displaced by the UCC. The trial court did not err in dismissing such claims in its final summary judgment based upon the pleadings and other documents properly before us in the record. However, we choose to limit our holding adopting the displacement concept of La. R.S. 10:1-103(b) to the facts of this case. In summary, any claim of ASP for conversion of third-party checks falls strictly within the purview of La. R.S. 10:3-420.

In Peak Performance, we were “squarely confronted with the threshold issue of whether the doctrine [of contra non valen-tem] has application to the issue of prescription under La. R.S. 10:3 — 420(f).” Id., 07-2206 at p. 8, 992 So.2d at 532. We thoroughly examined the statutory background, the prior Louisiana jurisprudence, and relevant jurisprudence of other jurisdictions. We ultimately held that “the equitable doctrine of contra \1Ron valentem cannot be applied to suspend prescription of a cause of action for the conversion of a negotiable instrument under La. R.S. 10:3-420(f), except in the event of fraudulent concealment by the defendant asserting prescription, a limited application of the third category of contra non valentem.” Id., 07-2206 at p. 11, 992 So.2d at 533. The customer in Peak Performance neither alleged nor presented evidence tending to establish any fraudulent concealment on the bank’s part. It therefore failed to meet its burden of proof of suspension of prescription under the narrow contra non valentem exception.

ASP urges us to reconsider our holding in Peak Performance. We decline. The policy considerations of certainty and uniformity upon which we based our holding in Peak Performance have not changed, nor has ASP convincingly put forth any opposing considerations warranting change or modification of the holding.

In its petition and its brief on appeal, ASP does not identify the third-party checks at issue with any particularity as to date. However, as previously noted, it appears undisputed that the third-party checks at issue were identified by ASP in its answers to interrogatories as forming part of the group Bates-numbered for identification as “A0001” through “A0187.” We have reviewed those documents, and it is apparent that only a portion of them actually constitute third-party checks payable to ASP. The majority of those were deposited or posted prior to December 15, 2002. As such, any causes of action relating to those checks are prescribed on their face.

Given the foregoing, the narrow issue before us with regard to the third-party checks deposited prior to December 15, 2002 is whether there is genuine issue of material fact relating to any fraudulent concealment by the |1fiBank relating to those cheeks, entitling ASP to invoke the narrow contra non valentem exception of Peak Performance to defeat summary judgment.

In his affidavit, Mr. Guillot claimed that he first discovered in July 2003 that Terry Guillory had converted a third-party check for $2,500.00 payable to ASP by cashing it at Goodbee, which in turn stamped its endorsement and deposited the check into its account at the Bank. According to Mr. Guillot, within two days he discovered that approximately $16,000.00 in third-party checks payable to ASP had been cashed at Goodbee and deposited into Goodbee’s account. After that discovery, Mr. Guillot “began pressing [the] Bank for information concerning not only checks drawn to [ASP] that had been deposited by [Goodbee] but [ASP’s] own checks as well.” At that point, according to Mr. Guillot, “the [B]ank kept stalling [his] inquiries.” He attested that he had previously been told that copies of ASP’s own cancelled checks were not included on its bank statements. He claimed in his affidavit that “the reason the [B]ank did not give [ASP its] checks” was “apparently to conceal the scheme.”

Considering the affidavit of Mr. Guillot, the only suggestion of “fraudulent concealment” on the Bank’s part relates to its alleged failure to provide copies of ASP’s cancelled checks and its alleged “stalling” in producing them during some indeterminate period after July 2003. Mr. Guillot’s conclusory statements in that regard are insufficient to give rise to any inference of fraud or fraudulent concealment. As previously noted, allegations of time are material in factual allegations, and evidence of the time period of any fraudulent concealment by the Bank is a crucial element of ASP’s burden of proof that the limited contra non valentem exception may be applicable. We agree with the Bank that ASP did not offer competent proof of any such “fraudulent concealment” by the Bank prior to |17the time that suit was filed. The trial court did not err in refusing to apply the limited doctrine of contra non valentem as articulated in Peak Performance. Accordingly, all claims of ASP relating to conversion of third-party checks prior to December 15, 2002 are prescribed under La. R.S. 10:3 — 420(f). This result applies even with regard to those checks cashed by Terry Guillory and deposited by Goodbee without any endorsements. See, e.g., Metro Elec. & Maint., Inc. v. Bank One Corp., 05-1045, pp. 6-7 (La.App. 3rd Cir.3/1/06), 924 So.2d 446, 450-51.

As to the small remainder of the identified third-party checks deposited on or after December 15, 2002, we conclude, as did the trial court, that ASP’s claims related to such checks are precluded by virtue of La. R.S. 10:3-405(b), which provides:

For the purpose of determining the rights and liabilities of a person who, in good faith, pays an instrument or takes it for value or for collection, if an employer entrusted an employee ivith responsibility loith respect to the instrument and the employee or a person acting in concert with the employee makes a fraudulent indorsement of the instrument, the indorsement is effective as the indorsement of the person to whom the instrument is payable if it is made in the name of that person. If the person paying the instrument or taking it for value or for collection fails to exercise ordinary care in paying or taking the instrument and that failure substantially contributes to loss resulting from the fraud, the person bearing the loss may recover from the person failing to exercise ordinary care to the extent the failure to exercise ordinary care contributed to the loss.

(Emphasis added.)

Louisiana Revised Statutes 10:3-405(a)(3) provides:

“Responsibility ” with respect to instruments means authority (i) to sign or indorse instruments on behalf of the employer, (ii) to process instruments received by the employer for bookkeeping purposes, for deposit to an account, or for other disposition, (iii) to prepare or process instruments for issue in the name of the employer, (iv) to supply information determining the names or addresses of payees of instruments to be issued in the name of the employer, (v) to control the disposition of instruments to be issued in the name of the 11Semployer, or (vi) to act otherwise with respect to instruments in a responsible capacity. “Responsibility” does not include authority that merely allows an employee to have access to instruments or blank or incomplete instrument forms that are being stored or transported or are part of incoming or outgoing mail, or similar access.

(Emphasis added.)

Despite the Guillots’ insistence that Terry Guillory was not an authorized signatory for ASP’s checks, the uncontradicted evidence shows that he had the apparent or implied authority to handle virtually all aspects of ASP’s financial affairs while he was “running the business” in the Guillots’ absence, and that while doing so he also had the “apparent control” or authority to manage and negotiate its financial instruments. In his deposition, Terry Guillory testified that he occasionally had to sign ASP checks under Mrs. Guillot’s name, due to the Guillots’ absence, that the Guil-lots were made aware of such actions, and that they ratified them after being so advised. In fact, the Guillots’ own affidavits strongly suggest that Terry Guillory must have had either the actual or implied authority to endorse checks and to issue ASP checks for the purchase of money orders in order to be able to “run the business” and to “fully [control] all of the financial affairs of the business.” Even if genuine issue might exist as to the extent of Terry Guil-lory’s express or formal authority to sign or endorse checks for ASP, it is undisputed that ASP and the Guillots delegated broad and almost unlimited managerial and financial responsibility to him, plainly extending beyond mere access to business checks or business mail, and falling within the statutory definition of “responsibility.”

| U|In his affidavit filed in the record, Mr. Guillot described Terry Guillory as “like a son to [him],” and stated that he “deeply trusted” him prior to the discovery of his alleged misappropriation of ASP’s funds. He confirmed that after his illnesses essentially disabled him, “Terry [Guillory] started trying to take control of the business and ran the day-to-day operations.” Mr. Guillot explained that Terry Guillory “may have been the only one at [ASP they] thought near capable of doing so.” He explained that although Mrs. Guillot “made an attempt to run the business” after he became disabled from doing so, she had previously performed “only minor tasks and errands for the business from time to time,” and “had no idea how to manage a business or any of its affairs.”

In her affidavit, Mrs. Guillot stated that she was employed by ASP, but confirmed that “[w]hile he was running [ASP], [Terry Guillory] fully controlled all of the financial affairs of the business.” She confirmed her trust in Terry Guillory during her husband’s illnesses, and further verified that Terry Guillory “basically took it upon himself to start running the business” and that she “had no reason to doubt his efforts to do so [and] anything to keep [her] husband’s business afloat.” Mrs. Guillot explained that Terry Guillory “handled all the mail of the business, including the monthly bank statements from [the Bank] and checks received from customers.” She claimed, however, that she “never authorized him to sign [her] name on anything and his name was not on the signature cards at the [B]ank for [ASP.]” Although Mrs. Guillot held the position of secretary-treasurer for the business, she admitted in her affidavit that she “had no clue as to how to run any business or to handle any of the financial matters related to it.”

|2ftAfter careful review of the record, we further note that ASP has never disputed or controverted the fact that the “money order policy” was an authorized business practice of ASP. Although it is unclear who with ASP instituted that practice, it is undisputed that Terry Guillory had the full authority, while acting as ASP’s de facto manager, to handle the financial transactions necessary to keep the business operating. Based upon the allegations of ASP’s petition, as amended, and the evidence, it is undisputed that the “money order policy” was known to and accepted by the Guillots during the time period it was in place.

ASP contends on appeal that “it is questionable as to whether the [B]ank followed its own procedures in honoring the checks and whether those procedures comply with reasonable banking standards.” However, ASP does not point to specific factual circumstances upon which a conclusion that genuine issue of material fact exists on those points. The record shows that ASP did not offer any competent proof relating to the Bank’s alleged failure to comply with its internal procedures, nor any proof of failure to comply with reasonable banking standards under the circumstances. See Cable Cast Magazine v. Premier Bank, Nat’l Ass’n, 98-0676, pp. 6-7 (La.App. 1st Cir.4/1/99), 729 So.2d 1165, 1168-69.

The mere fact that a forgery of a signature on a check is not detected does not prove that a bank’s signature verification procedures are not in accordance with reasonable commercial standards of the banking industry. See Gulf States Section, PGA, Inc. v. Whitney Nat’l Bank of New Orleans, 96-0844, p. 9 (La.App. 4th Cir.2/12/97), 689 So.2d 638, 648. Here, ASP 121failed to offer competent proof that the Bank’s practices failed to comport with ordinary care, or the “observance of reasonable commercial standards, prevailing in the area in which the person is located, with respect to the business in which the person is engaged.” See La. R.S. 10:3-103(a)(7). The statutory definition of “ordinary care” suggests that “adherence to local business standards and practices can be equated with the exercise of ordinary care, even if those practices are not necessarily in the customer’s interest.” Overby, supra at 379. The excerpts from the deposition testimony of the Bank employees offered by ASP simply do not demonstrate a deviation from either the Bank’s own procedures or local banking standards and practices.

The Forged ASP Checks

A person is not liable on a negotiable instrument unless that person or his agent or representative signed it. La. R.S. 10:3-401; Prestridge v. Bank of Jena, 05-545, p. 3 (La.App. 3rd Cir.3/8/06), 924 So.2d 1266, 1270, writ denied, 06-0836 (La.6/2/06), 929 So.2d 1261. Thus, the general rule is that when a bank pays on a forged check, it is liable for the amount of the check, plus legal interest from the date of judicial demand. See Marx v. Whitney Nat’l Bank, 97-3213, p. 4 (La.7/8/98), 713 So.2d 1142, 1145; Peak Performance, 07-2206 at p. 12, 992 So.2d at 533. However, there are several statutory exceptions to the general rule, and the Bank has raised them as defenses to ASP’s claims relating to the ASP forged checks.

Louisiana Revised Statutes 10:4-406 provides:

(a) A bank that sends or makes available to a customer a statement of account showing payment of items for the account shall either return or make available to the customer the items paid or provide information in the statement of account sufficient to allow the customer reasonably to identify the items paid. The statement of account provides sufficient information if the item is described by item number, amount, and date of payment.
122(b) If the items are not returned to the customer, the person retaining the items shall either retain the items or, if the items are destroyed, maintain the capacity to furnish legible copies of the items until the expiration of seven years after receipt of the items. A customer may request an item from the bank that paid the item, and that bank must provide in a reasonable time either the item or, if the item has been destroyed or is not otherwise obtainable, a legible copy of the item.
(c) If a bank sends or makes available a statement of account or items pursuant to Subsection (a), the customer must exercise reasonable promptness in examining the statement or the items to determine whether any payment was not authorized because of an alteration of an item or because a purported signature by or on behalf of the customer was not authorized. If, based on the statement or items provided, the customer should reasonably have discovered the unauthorized payment, the customer must promptly notify the bank of the relevant facts.
(d) If the bank proves that the customer failed, with respect to an item, to comply with the duties imposed on the customer by Subsection (c), the customer is precluded from asserting against the bank:
(1) the customer’s unauthorized signature or any alteration on the item, if the bank also proves that it suffered a loss by reason of the failure; and
(2) the customer’s unauthorized signature or alteration by the same wrongdoer on any other item paid in good faith by the bank if the payment was made before the bank received notice from the customer of the unauthorized signature or alteration and after the customer had been afforded a reasonable period of time, not exceeding thirty days, in which to examine the item or statement of account and notify the bank.
(e)If Subsection (d) applies and the customer proves that the bank failed to exercise ordinary care in paying the item and that the failure substantially contributed to loss, the loss is allocated between the customer precluded and the bank asserting the preclusion according to the extent to which the failure of the customer to comply with Subsection (c) and the failure of the bank to exercise ordinary care contributed to the loss. If the customer proves that the bank did not pay the item in good faith, the preclusion under Subsection (d) does not apply.
(fi Without regard to care or lack of care of either the customer or the bank, a customer who does not within one year after the statement or items are made available to the customer (Subsection (a)) discover and report the customer’s^unauthorized signature on or any alteration on the item is precluded from asserting against the bank the unauthorized signature or alteration. If there is a preclusion under this Subsection, the payor bank may not recover for breach of warranty under R.S. 10:4-208 with respect to the unauthorized signature or alteration to which the preclusion applies.

(Emphasis added.)

In its written reasons for judgment, the trial court observed that under the foregoing provision, “[t]he [B]ank is under no duty to furnish copies of the checks with the bank statements.” This is a correct statement of the law. See La. R.S. 10:4-406, Revised Uniform Commercial Code Comment, (1). As noted by one commentator:

A bank is not required to send the original checks back with the statement, a practice known as truncation.... Rather, the statutory requirement is that a bank “shall either return or make available to the customer the items paid or provide information in the statement of account sufficient to allow the customer reasonably to identify the items paid.” [Citation omitted.] Describing an item by item number, amount, and date of payment is sufficient to meet this test.

Overby, supra at 372 n. 136.

In her deposition, Mrs. Guillot testified that with regard to ASP’s monthly bank statements, it was the practice from 1996 through 2003 to simply place each statement into an envelope corresponding to its month and to mail or deliver the statements to the bookkeepers maintaining the business accounting records. She admitted that after Mr. Guillot became ill, she received the bank statements, but she “never looked at them,” nor did Mr. Guillot ever review them.

The affidavit of Michael Nunmaker was also filed in the record on behalf of ASP. Mr. Nunmaker attested that he “tried to assist [Mr. Guillot] as best [he] could in the Summer of 2003 when he discovered that Terry Guillory had been stealing from the business[.]” He recalled asking the Guillots for copies of ASP’s bank statements, and reviewed them, noting 124that the statements did not include copies of the cancelled checks. According to Mr. Nunmaker, the envelope for the most recent statement available had not yet been opened, and upon opening it he observed that it did not include copies of cancelled checks. He added that Mrs. Guillot “told me that [the] Bank had not given [ASP] its cancelled checks for quite some time despite their repeated requests for the checks.” As our review is de novo, we must disregard the hearsay statement of Mrs. Guillot as not within the personal knowledge of Mr. Nunmaker, the affiant.

Louisiana Revised Statutes 10:4— 406(d)(2) embodies the defense known generally as the “same wrongdoer” rule. This rule “imposes on the customer the risk of loss on all subsequent forgeries by the same wrongdoer after the customer had a reasonable time to detect an initial forgery if the bank has honored subsequent forgeries prior to notice.” Marx, 97-3213 at p. 6, 713 So.2d at 1146. In Marx, the supreme court found that because the plaintiff did not review and notify the defendant bank of the initial forgeries appearing in a bank statement within thirty days of receipt of that statement, he was “precluded from asserting against the bank all subsequent forgeries by the same unauthorized signatory.” Id., 97-3213 at p. 7, 713 So.2d at 1147.

It is undisputed that ASP did not notify the Bank within thirty days of the first ASP forged check appearing on its bank statement in 1997. It is likewise undisputed that the claimed forgeries were all made by the same alleged wrongdoer, Terry Guillory. Once the Bank established the foregoing facts, it was incumbent upon ASP to come forward with competent evidence that the Bank failed to exercise ordinary care in honoring the checks. As previously observed, the evidence in the record relating to the Bank’s practices falls short in that regard. Accordingly, we conclude that all of 12BASP’s claims relating to the forged ASP checks are barred by application of the “same wrongdoer” rule. See Peak v. Tuscaloosa Commerce Bank, 96-1258, pp. 9-10 (La.App. 1st Cir.12/29/97), 707 So.2d 59, 64-5, and Prestridge, 05-545 at pp. 13-19, 924 So.2d at 1275-79.

In addition to the “same wrongdoer” rule, the Bank has asserted that La. R.S. 10:4-406(f) precludes ASP’s claims relating to the forged ASP checks. That provision provides that after a year from the date a statement is provided to the customer, all claims relating to unauthorized signatures or alterations on items in the statement are barred, regardless of the absence of exercise of ordinary care on the part of either the customer or the bank.

The deposition testimony of Mrs. Guillot and Terry Guillory in the record confirms that ASP retained a number of successive bookkeepers over the period of time at issue, to whom the monthly bank statements were delivered for review and balancing, yet ASP inexplicably failed to notify the Bank of any discrepancies relating to the items reported on its bank statements until 2003 at the earliest, when suit was filed and ASP made general allegations of those discrepancies. Even then, there is no evidence in the record that ASP ever identified the items in question with any particularity until its answers to interrogatories were served in 2007. General notice to the bank that a theft or forgery has, or might have, occurred is not sufficient notice for purposes of La. R.S. 10:4 — 406(f). Rather, specific notice of the particular items at issue is required. Overby, supra at 401. See also First Place Computers, Inc. v. Sec. Nat’l Bank of Omaha, 251 Neb. 485, 558 N.W.2d 57, 59-61 (1997). By 2007, ASP’s claims against 12fithe Bank for the forged ASP checks were long stale under both La. R.S. 10:4-406(d)(2) and La. R.S. 10:4-406(f).

As noted by one authority:

In the most extreme cases of customer negligence, it is proper as a matter of policy that the law requires customers to bear the loss.... [T]he most significant defense that impacts customers’ ability to raise claims is section 4-406, the bank statement defense. Timely review of one’s bank statements is becoming a threshold for asserting bank liability under the [UCC], a threshold that is difficult for a substantial number of customers to meet. Unless a customer reviews their bank statement within thirty days of the bank’s sending it, significant losses in a continuing fraud ultimately may be borne by the customer through the “same wrongdoer” rule. Should a customer fail to review a statement within a one-year period — a seemingly not uncommon event given the recent cases that involve exactly such a failure — that failure will lead to the customer bearing the complete loss. Given the relatively low cost of performing such a review, the current judicial trend toward imposing those losses on these most negligent customers, where the basic requirements of the bank statement defense have not been met, is appropriate. In these cases, the customer is clearly in the best position to protect against many losses through the timely and adequate review of their statements.
Consider companies which delegate both the payment and review functions to one party. This creates an environment facilitating a successful long term fraud, and in fact, in some instances, it is almost a requirement for a successful corporate theft.... While requiring statement review involves some costs to businesses, particularly small businesses, this basic requirement is a significant measure which advances the effort to reduce the overall incidence of fraud. [Footnotes omitted.]

Overby, supra at 388-89. The unfortunate circumstances of the present action fit squarely within the case scenario described above.

In summary, we conclude that none of ASP’s assignments of error have merit. Summary judgment was appropriately rendered.

|27DECREE

The summary judgment of the trial court dismissing with prejudice the causes of action and claims of the plaintiff-appellant, ASP Enterprises, Inc., against the defendant-appellee, Parish National Bank, is affirmed. All costs of this appeal are assessed to the plaintiff-appellant.

AFFIRMED.

      . Parenthetically, we note that it is technically improper to incorporate written reasons for judgment in the judgment itself. See La. C.C.P. art. 1918. Such action does not, however, serve to invalidate the judgment. Country Club of La. Prop. Owners Ass’n n. Dornier, 96-0898, p. 13 (La.App. 1st Cir.2/14/97), 691 So.2d 142, 149.

      . The filing of this motion for summary judgment was suggested by the trial court at the hearing of the prior motion for clarification on May 29, 2008. According to the transcript of the hearing, the trial court suggested that the filing of the new motion for summary judgment was necessary to address ASP’s contentions that it had viable claims for conversion and negligence under non-UCC Louisiana law.

      .ASP has not appealed that portion of the judgment of the June 11, 2008 judgment that reaffirmed the prior granting of the RICO motion and the final dismissal of the RICO claims against the Bank. Thus, the RICO claims are not before us.

      . ASP argues that the Bank must prove its status as a "holder in due course” in order to be entitled to assert the benefit of any "safe harbor,” prescription, and other defenses to ASP's claims. Acknowledging that there are no Louisiana cases supporting that position, ASP has cited the case of First State Bank & Trust Co. of Edinburg v. George, 519 S.W.2d 198 (Tex.App.1974). The cited case, however, involved the different factual situation in which the plaintiff bank sought to enforce dishonored checks for which it had given credit against the checks' drawers. In order to defeat the drawers' personal defenses relating to the checks, it was necessary for the plaintiff bank seeking to enforce the checks to invoke the status of a "holder in due course.” The Bank in the present case is not seeking to enforce payment as a depository bank. Accordingly, the cited case does not support ASP's position. We agree with the Bank and amicus curiae that "holder in due course" status is irrelevant to the issues presented by ASP’s causes of action.

      . ASP contends that La. R.S. 10:3-404 governs its claims relating to third-party checks (rather than ASP checks) payable to “Good-bee Screen Printers” and other alleged fictitious payees created by Terry Guillory. The Bank emphasizes that it never raised any “fictitious payee” defense relating to any checks issued or drawn on ASP's account. Based upon our review of the language of La. R.S. 10:3-404, particularly paragraphs (b) and (d), and the related UCC Comment, we conclude that the statute's provisions have no application to the proceeds of any third-party checks to which ASP claims it was rightfully entitled. Rather, the statute would only have relevance if ASP claimed that Terry Guillory issued ASP checks to fictitious payees. While ASP might have a claim for conversion under general Louisiana law against Terry Guillory for diversion of sums actually owed to ASP by the third parties issuing the checks, any conversion claim against the Bank must fall strictly within La. R.S. 10:3-420.

      . This statute provides: “Unless displaced by the particular provisions of this Title, the other laws of Louisiana supplement its provisions.” (Emphasis added.) During the time period at issue in this matter, the present language of La. R.S. 10:1-103(b) constituted the entire text of former La. R.S. 10-1:103. The present version of La. R.S. 10:1-103 was enacted by Acts 2006, No. 533, § 1.

      . This language tracks that of the UCC in other states. "Responsibility with respect to instruments is very broadly defined to cover most acts in a responsible capacity regarding instruments....” A. Brooke Overby, Check Fraud in the Courts After the Revisions to

        U.C.C. Articles 3 and 4, 57 Ala. L.Rev. 351, 375 (2005).

      . In his deposition filed in the record, Terry Guillory testified that the "money order policy" was not formally instituted by anyone on behalf of ASP, but evolved through necessity, due to a problem with ASP's checks to vendors being dishonored (''bouncing”). This testimony was not refuted by the Guillots or any other witness for ASP.

      . Because we find that ASP's claims relating to the forged ASP checks are clearly barred under La. R.S. 10:4-406(d)(2) and 10:4-406(f), it is unnecessary for us to address the Bank’s additional defense of three-year prescription under La. R.S. 10:4 — 111.


source: Caselaw Access Project

author: PETTIGREW, J.

license: Public Domain

text:
    TIG INSURANCE COMPANY v. LOUISIANA WORKERS’ COMPENSATION CORPORATION.
    No. 2009 CA 0330.
    Court of Appeal of Louisiana, First Circuit.
    Sept. 11, 2009.

      John H. Hughes, Lafayette, LA for Plaintiff-Appellant TIG Insurance Company.
    Jeffrey J. Warrens, Baton Rouge, LA, for Defendant-Appellee Louisiana Workers’ Compensation Corporation. '
    Before CARTER, C.J, GUIDRY, and PETTIGREW, JJ.
   PETTIGREW, J.

|aThis matter is before us on appeal from a judgment of the Office of Workers’ Compensation (“OWC”), finding a contribution claim by TIG Insurance Company (“TIG”) against Louisiana Workers’ Compensation Corporation (“LWCC”) prescribed. For the following reasons, we affirm in part, reverse in part, and remand.

FACTS AND PROCEDURAL HISTORY

Carl Thomas, an employee of Louisiana Log Homes Company, Inc. (“Louisiana Log”), filed a disputed claim form with the OWC alleging he had suffered a work-related injury. TIG provided workers’ compensation insurance to Louisiana Log at the time of the accident and paid Thomas compensation benefits and medical expenses. TIG settled with Thomas and subsequently filed a claim with the OWC against LWCC alleging it also had a workers’ compensation policy in effect covering Louisiana Log on the date of the alleged accident. TIG asserted LWCC was a soli-dary obligor in relation to workers’ compensation benefits previously paid to Thomas by TIG, and as such, was liable to TIG for one-half of its expenditure associated with the handling and settlement of Thomas’ compensation claim, or $53,397.94, plus costs and judicial interest.

In response to TIG’s claim, LWCC filed an exception raising the objection of prescription, arguing that TIG failed to timely file its contribution claim. Noting that the last payment of workers’ compensation benefits to Thomas by TIG was on July 9, 2002, and that TIG’s claim against LWCC was not filed until April 25, 2006, LWCC alleged that pursuant to the prescriptive periods set forth within La. R.S. 23:1209, any claim TIG had against LWCC for contribution was prescribed. On April 20, 2007, after hearing argument from the parties, and considering the documentary evidence introduced into the record by TIG, the OWC judge agreed that TIG’s claim was prescribed pursuant to La. R.S. 23:1209. In a judgment rendered May 7, 2007, the OWC judge sustained LWCC’s prescription exception, dismissing, with prejudice, TIG’s contribution claim against LWCC. It is from this judgment that TIG has appealed.

PRESCRIPTION

If the facts alleged in a petition do not show that a claim has prescribed, the burden is on the party raising the objection of prescription to prove it. Conversely, if a claim is prescribed on the face of the pleadings, the burden is on the plaintiff to show that prescription has not tolled because of an interruption or a suspension of prescription. Bracken v. Payne and Keller Co., Inc., 2006-0865, p. 4 (La.App. 1 Cir. 9/5/07), 970 So.2d 582, 587. At the trial of a peremptory exception, evidence may be introduced to support or controvert any of the objections pleaded, when the grounds thereof do not appear from the petition. La.Code Civ. P. art. 931. Generally, in the absence of evidence, the objection of prescription must be decided on the facts alleged in the petition, and all allegations thereof are accepted as true. Boudreaux v. Angelo Iafrate Const., 2003-2260, p. 3 (La.App. 1 Cir. 2/4/05), 895 So.2d 596, 598.

If evidence is introduced at the hearing on the peremptory exception raising the objection of prescription, the district court’s findings of fact are reviewed under the manifest error or clearly wrong standard of review. Oil Ins. Ltd. v. Dow Chemical Co., 2007-0418, p. 7 (La.App. 1 Cir. 11/2/07), 977 So.2d 18, 22, writ denied, 2007-2319 (La.2/22/08), 976 So.2d 1284; see Stobart v. State through Dept. of Transp. and Development, 617 So.2d 880, 882-883 (La.1993). Essentially, if the findings are reasonable in light of the record reviewed in its entirety, an appellate court may not reverse even though convinced that had it been sitting as the trier of fact, it would have weighed the evidence differently. Oil Ins. Ltd., 2007-0418 at 7, 977 So.2d at 23.

DISCUSSION

Louisiana Revised Statutes 23:1209 addresses the prescriptive period for workers’ compensation claims, providing as follows:

A. In case of personal injury, including death resulting therefrom, all claims for payments shall be forever barred unless within one year after the accident or death the parties have agreed upon the payments to be made under this Chapter, or unless within one year after the accident a formal claim has been filed as provided in Subsection B of this Section and in this Chapter. Where such payments have been made in any case, the limitation shall not take effect until the expiration of one year from the |4time of making the last payment, except that in cases of benefits payable pursuant to R.S. 23:1221(3) this limitation shall not take effect until three years from the time of making the last payment of benefits pursuant to R.S. 23:1221(1), (2), (3), or (4). Also, when the injury does not result at the time of, or develop immediately after the accident, the limitation shall not take effect until expiration of one year from the time the injury develops, but in all such cases the claim for payment shall be forever barred unless the proceedings have been begun within two years from the date of the accident.
B. Any claim may be filed with the director, office of worker’s compensation, by delivery or by mail addressed to the office of worker’s compensation. The filing of such claims shall be deemed timely when the claim is mailed on or before the prescription date of the claim. If the claim is received by mail on the first legal day following the expiration of the due date, there shall be a rebuttable presumption that the claim was timely filed. In all cases where the presumption does not apply, the timeliness of the mailing shall be shown only by an official United States postmark or by official receipt or certificate from the United States Postal Service made at the time of mailing which indicates the date thereof.
C. All claims for medical benefits payable pursuant to R.S. 23:1203 shall be forever barred unless within one year after the accident or death the parties have agreed upon the payments to be made under this Chapter, or unless within one year after the accident a formal claim has been filed with the office as provided in this Chapter. Where such payments have been made in any case, this limitation shall not take effect until the expiration of three years from the time of making the last payment of medical benefits.
D. When a petition for compensation has been initiated as provided in Section 1310.3, unless the claimant shall in good faith request a hearing and final determination thereon within five years from the date the petition is initiated, same shall be barred as the basis of any claim for compensation under the Worker’s Compensation Act and shall be dismissed by the office for want of prosecution, which action shall operate as a final adjudication of the right to claim compensation thereunder.[]

Thus, under La. R.S. 23:1209(A), claims are barred unless filed within: (1) one year from the date of the accident; (2) one year from the last compensation payment for total disability or three years from the last payment for partial disability; or (3) one year from the time the injury develops if not immediately manifested, but, in any event, no more than two years after the accident. Additionally, La. R.S. 23:1209(0) provides that a claim for medical benefits prescribes one year from the date of the accident unless payments have been agreed upon, or unless a claim is filed within one year of the | r,accident. Where payments have been made, the claim prescribes three years from the date of the last payment of medical benefits. Hudson v. East Baton Rouge Parish School Bd., 2002-0987, p. 4 (La.App. 1 Cir. 3/28/03), 844 So.2d 282, 286.

On appeal, however, TIG asserts that La. R.S. 23:1209 is not a general prescriptive period applicable to all claims brought in workers’ compensation courts. TIG argues that because TIG and LWCC were both contractually liable to Thomas for workers’ compensation benefits, and because TIG paid $106,795.89 in benefits and expenses incurred as a result of Thomas’ work-related accident, TIG was legally subrogated to its obligee’s (Thomas) rights to recover from LWCC one half of these total expenditures incurred by TIG based on La. Civ.Code arts. 1804 and 1829. Citing this court’s opinion in Employers’ Liability Assur. Corp. v. General Acc. Fire & Life Assur. Corp., 125 So.2d 689 (La.App. 1 Cir.1960), TIG maintains that a claim by one solidary obligor against another solidary obligor to recover workers’ compensation payments is a claim for restitution governed by a ten-year prescriptive period as set forth in La. Civ.Code art. 3499.

LWCC responds in brief that TIG did not introduce any evidence at the hearing on the prescription exception to establish that the alleged work-related accident did in fact occur, and if so, the nature and extent of any injuries and disability sustained by Thomas as a result of the accident. Moreover, LWCC maintains there has been no evidence submitted that would establish solidary liability. Thus, LWCC contends the only issue before this court is whether the contribution claim by TIG against LWCC has prescribed. Noting that TIG’s last payment of workers’ compensation benefits to Thomas was on July 9, 2002, and that TIG did not file the instant claim against LWCC until April 25, 2006, LWCC alleges that pursuant to the prescriptive periods set forth within La. R.S. 23:1209, any claim TIG had against LWCC for contribution was clearly prescribed.

We initially note that TIG’s reliance on Employers’, supra, in support of its ^assertion that the ten-year prescriptive period found in Article 3499 applies to its contribution claim against LWCC is misplaced. In Employers’, a dispute arose as to whether the insurer at the time of a work-related accident or the insurer at the time a disability developed was required to pay benefits, and the latter party paid in order to avoid possible penalties. Thereafter, in a suit for recovery of benefits paid by plaintiff insurer, defendant insurer sought to interject prescription of one year pursuant to La. R.S. 23:1209. By reference to cases involving La. Civ.Code art. 2302 (Girod v. Barbe, 153 So. 326 (La.App. 1 Cir.1934); Smith v. Phillips, 175 La. 198, 143 So. 47 (La.1932); Lagarde v. Dabon, 155 La. 25, 98 So. 744 (La.1923)), this court held that the relief sought by plaintiff insurer at the time of the employee’s disability was for restitution, and therefore, the applicable prescriptive period was ten years. Employers’, 125 So.2d at 693.

In the instant case, there has been no payment of the debt of another person and a subsequent claim for restitution as in Employers’. Rather, TIG has admitted workers’ compensation liability to Thomas, and is now relying on statutory articles governing solidary liability and legal sub-rogation in its contribution claim against LWCC. Thus, Employers’ is easily distinguishable from the case before us now.

The issue of which prescriptive period is applicable to cross-claims between employers or workers’ compensation insurers for contribution is res nova in this circuit. However, the issue has been squarely addressed by the third circuit in Larkin v. Regis Hair Stylists, 2002-127 (La.App. 3 Cir. 5/15/02), 817 So.2d 1266, and we find the third circuit’s analysis of same very helpful in our review of the appeal currently before us.

|7In Larkin, the plaintiff injured her back while moving boxes on October 21, 1999, during the course and scope of her employment with Regis Hair Stylists. She filed a workers’ compensation claim against Regis on March 23, 2000. Regis and its workers’ compensation insurer, Atlantic Mutual, filed a third party demand against plaintiffs previous employer, Books-A-Million, and its workers’ compensation insurer, Travelers Insurance Company, asserting that plaintiff had suffered a back injury while employed with Books-A-Million in 1996. Books-A-Million and Travelers filed an exception raising the objection of prescription, arguing that the one-year prescriptive period of La. R.S. 23:1209 had expired. The trial court granted the prescription exception. Larkin, 2002-127 at 1-2, 817 So.2d at 1266-1267.

In addressing the issue on appeal, the third circuit noted that in 1997, the legislature amended La. R.S. 23:1310.3(E) to provide as follows:

E. Except as otherwise provided by R.S. 23:1101(D) and 1378(E), the workers’ compensation judge shall be vested with original, exclusive jurisdiction over all claims or disputes arising out of this Chapter, including but not limited to workers’ compensation insurance coverage disputes, employer demands for recovery for overpayment of benefits, the determination and recognition of employer credits as provided for in this Chapter, and cross-claims between employers or workers’ compensation insurers for indemnification or contribution. [Emphasis added.]

The Larkin court continued, finding that the amendment to La. R.S. 23:1310.3(E) “clearly granted original and exclusive jurisdiction of claims between insurers for contribution to the Office of Workers’ Compensation.” Larkin, 2002-127 at 3, 817 So.2d at 1268. The court further noted, “[La.] R.S. 23:1209 provides that ‘all claims for payments shall be forever barred’ unless brought within one year. R.S. 23:1209 does not grant any exceptions or extensions for a contribution claim filed by an insurer against another beyond the one year period.” Larkin, 2002-127 at 3-4, 817 So.2d at 1268. The court ultimately concluded, “[g]iven the contribution claim Regis attempts to advance falls within the purview of the Workers’ Compensation Act, the one year prescriptive period |8of R.S. 23:1209, which pertains to all claims brought under the Workers’ Compensation Act, is applicable in this case.” Larkin, 2002-127 at 5, 817 So.2d at 1268. Accordingly, the third circuit affirmed the ruling of the trial court that the claim by Regis and Atlantic Mutual for contribution had prescribed.

In oral reasons for judgment, the OWC judge in the instant case acknowledged that this circuit had not “spoken to this precise issue since the amendment in '97 to [La. R.S.] 1310.3.” The OWC judge agreed with the Larkin court’s reasoning, noting as follows:

I feel that in '97 when the cross claims jurisdiction was added to the workers’ compensation court that had the legislature felt that a special prescriptive period for those claims should have been presented in the Act, they had the opportunity to do so. They did not change prescription under 1209 in any way to adopt or to change with the additional subject matter jurisdiction of cross claims. 1209 does say, “All claims.” 1209 has been here for a very long time, much earlier than the 1997 amendment and when it came into play, that was not here. The legislature certainly could have increased the time limit for insurance cross claims had they so desired and nobody, in my mind, is more in the know than the two insurance companies as to this overlapping of coverage. I don’t really know why TIG waited so long to ask for contribution. It’s been almost four years since they paid this claim. It’s always been my feeling that the reason you have such a long prescriptive period in the civil code of personal actions was to give people time to discover that they had a cause of action. You might get hurt and not realize it or you might not be able to find the person that hurt you or what have you, but I’m sure that the employer knew pretty early on that they had policies that overlapped. One expired after the date of the accident and the other began before the date of the accident. It just seems that this is a classic case that should sit under 1209 because all the knowledge is there to ask for the contribution and file the cross claim in the workers’ compensation court. This accident happened after the '97 incident, so it’s not like, we weren’t sure whether we should get in district court or what have you. The time line still — you would have had — I would say you have had at least three years because who could say that the money in the settlement was for SEB, medicals, or — you would have the optimal time of three years to file.
I think that the reasoning the third circuit uses with regard to the amendment and my own feeling that if the legislature wanted to add a better prescriptive period for cross claims, they had the opportunity when they added the jurisdiction, puts it squarely in 1209.

Having reviewed the record before us and the applicable statutory law and jurisprudence, we agree with the third circuit’s reasoning that until the Legislature expresses itself to the contrary, the prescriptive period applicable to cross claims between employers or workers’ compensation insurers for indemnification or | ¡icontribution is found in La. R.S. 23:1209. Accordingly, based on the evidence, TIG’s claim for contribution as it relates to disability benefits it paid to Thomas is clearly prescribed. However, our inquiry does not end here.

As noted by the OWC judge, not knowing what the “money in the settlement was for,” whether it was for medical benefits or supplemental earnings benefits, TIG would have had up to three years to file its contribution claim and failed to do so. See La. R.S. 23:1209(A), (C). Instead, TIG waited until almost four years had elapsed from the date of the last payment to Thomas to initiate its claim against LWCC. Pursuant to the prescriptive periods set forth in La. R.S. 23:1209, TIG’s claim for contribution is prescribed on its face. Therefore, the burden shifted to TIG to show that an interruption or suspension of prescription occurred.

Although not raised by the parties on appeal, we note a possible interruption of prescription by a prior suit filed by TIG against LWCC concerning TIG’s claim for contribution. Louisiana Civil Code article 3462 provides for interruption of prescription by filing of suit or by service of process as follows:

Prescription is interrupted when the owner commences action against the possessor, or when the obligee commences action against the obligor, in a court of competent jurisdiction and venue. If action is commenced in an incompetent court, or in an improper venue, prescription is interrupted only as to a defendant served by process within the prescriptive period. [Emphasis added.]

See Woods v. State, Dept. of Health and Hospitals, 2008-0257, p. 8 (La.App. 1 Cir. 6/6/08), 992 So.2d 1050, 1055, writ denied, 2008-2426 (La.12/19/08), 996 So.2d 1133. Moreover, La. Civ.Code art. 3466 provides, “If prescription is interrupted, the time that has run is not counted. Prescription commences to run anew from the last day of interruption.”

According to the record, TIG had previously filed a suit against LWCC in the 19th Judicial District Court seeking contribution from LWCC regarding benefits TIG paid to Thomas following the accident at issue. While there are no file stamped copies of the pleadings in the record before us, TIG did introduce copies of the pleadings into evidence at the hearing on the prescription exception. The copy of the petition | ^indicates it was prepared on August 23, 2004. The copy of LWCC’s answer and exception raising the objection of lack of subject matter jurisdiction appears to have been prepared on September 22, 2004. Pursuant to La.Code Evid. art. 202, we take judicial notice of LWCC’s writ application to this court from the trial court’s denial of LWCC’s exception raising the objection of subject matter jurisdiction. See TIG Ins. Co. v. Louisiana Workers’ Compensation Corp., 2004-2608, p. 6 (La.App. 1 Cir. 6/10/05), 917 So.2d 26, 29, writ denied, 2005-1821 (La.1/27/06), 922 So.2d 553, wherein this court held that La. R.S. 23:1310.3 clearly and explicitly places jurisdiction over a claim for subrogation between workers’ compensation insurers, pursuant to workers’ compensation coverage, within the scope of the OWC. Thus, although we do not know the exact filing dates of these pleadings or the date that LWCC was served, we presume that there was service of process sometime prior to September 22, 2004, which would have been within the original prescriptive period for medical benefits and/or supplemental earnings benefits. Accordingly, if TIG did in fact make any such payments to Thomas, prescription as to these claims may have been interrupted, and said prescription would not have commenced to run again, anew, until the judgment from the 19th Judicial District Court case was final. See La. Civ.Code art. 3466.

DECREE

For the above and foregoing reasons, we affirm the judgment of the OWC as it relates to disability benefits paid to Thomas. As it relates to any payments of medical benefits or supplemental earnings benefits, we reverse the judgment of the OWC and remand the matter for further proceedings consistent with this opinion. All costs associated with this appeal are assessed against TIG Insurance Company.

AFFIRMED IN PART, REVERSED IN PART, REMANDED.

CARTER, C.J., and GUIDRY, J., concur.

      . Although this is the version of La. R.S. 23:1209 in effect at all pertinent times hereto, we note that the statute was amended by Acts 2008, No. 220, § 8. Said amendment simply inserted paragraph designations in subsec. A; in par. (A)(3), substituted ''When” for "Also, when”; in the first sentence of subsec. B, substituted "workers’" for "worker's” twice; and in subsec. D, substituted "R.S. 23:1310.3” for "Section 1310.3” and "that claim” for “same”.

      . Louisiana Civil Code article 3499 provides that “[u]nless otherwise provided by legislation, a personal action is subject to a libera-tive prescription of ten years.”

      . Louisiana Civil Code article 2302 provides, in pertinent part, as follows, concerning the payment of the debt of another: "A person who paid the debt of another person in the erroneous belief that he was himself the obli-gor may reclaim the payment from the obli-gee. ... In such a case, the person who made the payment has a recourse against the true obligor.”

      . In Barrios v. Lambar, Inc., 2006-0324 (La.App. 1 Cir. 12/28/06), 951 So.2d 323, third party defendants in a workers' compensation contribution claim urged a prescription exception, arguing that based on the amendment to La. R.S. 23:1310.3(E), workers' compensation contribution claims are now subject to the one-year prescriptive period set forth in La. R.S. 23:1209. Finding that the third-party contribution claim was timely filed within one year from the date of the last payment of workers' compensation benefits (see La. R.S. 23:1209(A)(2)), this court preter-mitted consideration of which prescriptive period was, in fact, applicable to third-party claims for contribution. Barrios, 2006-0324 at 9 n. 4, 951 So.2d at 329 n. 4.

      . As the claim in Larkin was a claim for temporary total disability benefits, the one-year prescriptive period of La. R.S. 23:1209 was clearly applicable. However, as previously noted, there are different prescriptive periods applicable for supplemental earnings benefits and medical benefits that were not at issue in Larkin.


author: WELCH, J.

text:
    Dusty HUTCHISON v. SEARIVER MARITIME, INC.
    No. 2009 CA 0410.
    Court of Appeal of Louisiana, First Circuit.
    Sept. 11, 2009.

      Timothy J. Young, Robert J. Young, Jr., Jason C. MacFetters, Robin Richmond Klibert, New Orleans, LA, for Plaintiff-Appellant, Dusty Hutchison.
    Thomas J. Wagner, Thomas A. Rayer, Jr., New Orleans, LA, for Defendant-Ap-pellee, SeaRiver Maritime, Inc.
    Before WHIPPLE, HUGHES, and WELCH, JJ.
   WELCH, J.

|2In this action for damages arising under the Jones Act, the plaintiff, Dusty Hutchison, appeals a judgment of the trial court dismissing his action as abandoned. For the reasons that follow, we reverse the judgment and remand for further proceedings.

I. FACTUAL AND PROCEDURAL HISTORY

Mr. Hutchison filed a seaman’s petition for damages on February 16, 2001, alleging that he was injured on April 2, 2000, while he was employed as a Jones Act seaman aboard the M/V S.R. Chicago, a vessel in navigation that is owned, operated, and/or controlled by the defendant, SeaRiver Maritime, Inc. (“SeaRiver”). On April 3, 2001, SeaRiver filed an answer generally denying the allegations of Mr. Hutchison’s petition. Thereafter, in 2001 and 2002, the parties conducted discovery, including depositions. Additionally, various motions related to discovery were filed in the record of these proceedings.

On March 18, 2005, a scheduling order form was filed into the record. The scheduling order provided that the discovery cutoff date would be September 1, 2005, that the parties would exchange pretrial inserts by October 3, 2005, that the pretrial order would be due on October 10, 2005, and that the pretrial conference would be scheduled for October 14, 2005.

On August 29, 2005, Hurricane Katrina struck southeastern Louisiana and devastated the New Orleans area. Since counsel for both parties had their offices located in New Orleans and were displaced from their offices due to Hurricane Katrina, on October 12, 2005, the parties filed a joint motion to indefinitely extend the deadlines previously established in the March 18, 2005 scheduling order.

No other pleadings or filings appear in the record of this matter until October 16, 2008, when SeaRiver filed a motion to dismiss Mr. Hutchison’s action based on abandonment. Mr. Hutchison opposed the motion asserting that both parties |shad begun selecting dates to bring the matter to trial, that counsel for SeaRiver had offered to file a scheduling order with the court in September 2007, and that counsel for Mr. Hutchison provided SeaRiver with a signed proposed scheduling order in November 2007, but counsel for SeaRiver had failed to file the proposed scheduling order. Mr. Hutchison also asserted that his counsel had followed up on the scheduling order in March 2008, that additional written discovery was propounded on June 26, 2008, and that counsel for Mr. Hutchison again provided a proposed scheduling order to SeaRiver in July 2008.

After a hearing on December 8, 2008, the trial court ruled as follows:

[F]rom March 21, 2005, until June 28, 2008, a period in excess of three years, there were no steps in the prosecution of this matter, no other action took place. And the only thing that plaintiff relies upon are certain correspondences between counsel for plaintiff and counsel for defendant that are not formal discovery and, in my opinion, do not form the basis of sufficient action to interrupt the abandonment period under [La. C.C.P. art.] 561. So based upon my review of the record, the [c]ourt finds that as of March 21, 2008, the [three]-year abandonment!] period had passed with no action. Therefore, the [c]ourt is going to grant the motion to dismiss, dismissing plaintiffs suit, with prejudice, at plaintiffs costs.

The trial court signed a judgment in conformity with its ruling on December 16, 2008. From this judgment, Mr. Hutchison now appeals.

II. ASSIGNMENTS OF ERROR

On appeal, Mr. Hutchison asserts that the trial court erred in: (1) granting SeaR-iver’s motion for dismissal based upon abandonment because he continually sought to move his case forward, in the method preferred by the trial court, and with the agreement of SeaRiver; and (2) holding that the applicable time period governing abandonment of cases necessarily delayed by Hurricanes Katrina and Rita is three years, instead of the five years set forth in La. C.C.P. art. 561.

|4III. LAW AND DISCUSSION

A. Standard of Review

Whether or not a step in the prosecution of a case has been taken in the trial court for a period of three years is a question of fact subject to a manifest error analysis on appeal. Brown v. Kidney and Hypertension Associates, L.L.P., 2008-0919, p. 7 (La.App. 1st Cir.1/12/09), 5 So.3d 258, 264. On the other hand, whether a particular act, if proven, precludes abandonment is a question of law that we review by simply determining whether the trial court’s decision was legally correct. Id.; Compensation Specialties, L.L.C. v. New England Mutual Life Insurance Company, 2008-1549, p. 4 (La.App. 1st Cir.2/13/09), 6 So.3d 275, 278, writ denied, 2009-0575 (La.4/24/09), 7 So.3d 1200.

B. Abandonment

The controlling statutory provision in this case is La. C.C.P. art. 561, which provides in part:

A. (1) An action, except as provided in Subparagraph (2) of this Paragraph, is abandoned when the parties fail to take any step in its prosecution or defense in the trial court for a period of three years, unless it is a succession proceeding!.]
(2) If a party whose action is declared or claimed to be abandoned proves that the failure to take a step in the prosecution or defense in the trial court or the failure to take any step in the prosecution or disposition of an appeal was caused by or was a direct result of Hurricane Katrina or Rita, an action originally initiated by the filing of a pleading prior to August 26, 2005, which has not previously been abandoned in accordance with the provisions of Subpara-graph (1) of this Paragraph, is abandoned when the parties fail to take any step in its prosecution or defense in the trial court for a period of five years, unless it is a succession proceeding^]
(3) This provision shall be operative without formal order, but, on ex parte motion of any party or other interested person by affidavit which provides that no step has been timely taken in the prosecution or defense of the action, the trial court shall enter a formal order of dismissal as of the date of its abandonment. ...
_k- • • •
B. Any formal discovery as authorized by this Code and served on all parties whether or not filed of record, including the taking of a deposition with or without formal notice, shall be deemed to be a step in the prosecution or defense of an action.

Louisiana Code of Civil Procedure article 561 has been construed as imposing three requirements on plaintiffs. First, plaintiffs must take some “step” towards prosecution of their lawsuit. In this context, a “step” is defined as taking formal action before the court which is intended to hasten the suit toward judgment, or the taking of a deposition with or without formal notice. Clark v. State Farm Mutual Automobile Insurance Company, 2000-3010, pp. 5-6 (La.5/15/01), 785 So.2d 779, 784. Second, the step must be taken in the proceeding and, with the exception of formal discovery, must appear in the record of the suit. Third, the step must be taken within the legislatively prescribed time period of the last step taken by either party; sufficient action by either plaintiff or defendant will be deemed a step. Clark, 2000-3010 at p. 6, 785 So.2d at 784.

The jurisprudence has uniformly held that La. C.C.P. art. 561 is to be liberally construed in favor of maintaining a plaintiffs suit. Clark, 2000-3010 at p. 8, 785 So.2d at 785. The purpose of La. C.C.P. art. 561 is to dismiss actions which have been abandoned, and the article provides for dismissal of those cases in which a plaintiffs inaction during a legislatively ordained period has clearly demonstrated his abandonment of the case. The article was not intended, however, to dismiss those cases in which a plaintiff has clearly demonstrated before the court during the prescribed period that he does not intend to abandon the action. Clark, 2000-3010 at pp. 8-9, 785 So.2d at 785-786. Appellate courts have declined to allow form to prevail over substance in determining whether an action has been abandoned, and our supreme court has likewise declined to allow suits to be |fidismissed as abandoned based on technical formalities. Clark, 2000-3010 at p. 9, 785 So.2d at 786. Given that dismissal is the harshest of remedies, the general rule is that any reasonable doubt about abandonment should be resolved in favor of allowing the prosecution of the claim and against dismissal for abandonment. Clark, 2000-3010 at p. 10, 785 So.2d at 787.

With these principles in mind, we first evaluate whether the plaintiffs claim is abandoned based on the record. Prior to the October 16, 2008 filing of SeaRiver’s motion to dismiss Mr. Hutchison’s suit as abandoned, the last action in the record was the October 12, 2005 joint motion to extend the discovery and pre-trial deadlines that were previously established in this case. The trial court found, and we agree, that this motion was essentially a motion to continue (and not a motion to extend) because the motion sought an indefinite extension of the deadlines, did not request that the court set any new deadlines, and indicated that, at some point in the future, the parties would request new deadlines. A joint motion to continue without date or indefinitely is not considered a step in the prosecution of a case, since by its very nature, an indefinite continuance is not intended to hasten the matter to judgment. See Oliver v. Oliver, 95-1026 (La.App. 3rd Cir.3/27/96), 671 So.2d 1081, 1090; c.f. Reed v. Finklestein, 2001-1015, p. 6 (La.App. 4th Cir.1/16/02), 807 So.2d 1032, 1035, writ denied, 2002-0550 (La.4/26/02), 814 So.2d 560 (opposing a motion to continue and/or filing a motion to continue to a date certain may be a step in the prosecution of a case because it evidences an intent of the parties to hasten the suit to judgment). Accordingly, in this case, we find that the joint motion to indefinitely extend or continue the deadlines previously established did not constitute a step in the prosecution of this case.

The last action in the record prior to the joint motion to extend deadlines is the March 18, 2005 scheduling order. Both counsel and the trial court signed the |7scheduling order. The scheduling order contained a discovery cutoff date, the final dates to exchange pretrial inserts, and dates for the preparation and filing of the pretrial order — all formal steps in the case meant to hasten the matter to judgment. See Tessier v. Pratt, 2008-1268, p. 7 (La.App. 1st Cir 2/13/09), 7 So.3d 768, 773. Accordingly, we find that the March 18, 2005 scheduling order was the last step in the prosecution of the case, appearing in the record before the October 16, 2008 motion to dismiss. And, since the motion to dismiss was filed more than three years from the March 18, 2005 scheduling order — the last step in the record of the prosecution of the case — this case appears to be abandoned.

However, we must next determine whether a cause outside the record prevented the accrual of the three-year abandonment period. Only two categories of causes outside the record to prevent abandonment are permitted; namely, those causes falling within the two jurisprudential exceptions to the abandonment rule. Clark, 2000-3010 at p. 7, 785 So.2d at 784. Those two exceptions are: (1) a plaintiff-oriented exception based on contra non valentem, that applies when the failure to prosecute is caused by circumstances beyond the plaintiffs control; and (2) a defense-oriented exception based on acknowledgement, that applies when the defendant waives his right to assert abandonment by taking actions inconsistent with the intent to treat the case as abandoned. Clark, 2000-3010 at p. 7, 785 So.2d at 784-785. With regard to the defense-oriented exception, the conduct or actions of the defendant which are inconsistent with the intent to treat a case as abandoned and which result in the waiver of the right to assert abandonment may occur either before or after the abandonment period has accrued and serves to recommence the abandonment period running anew. See Clark, 2000-3010 at pp. 11-16, 785 So.2d at 787-789. Furthermore, in determining the issue of abandonment, “the intent and substance of a party’s actions matter far more than technical compliance.” Thibaut Oil Co., Inc. v. Holly, 2006-0313, p. 5 (La.App. 1st Cir.2/14/07), 961 hSo.2d 1170, 1172-1173.

Mr. Hutchison contends that his case is not abandoned based on correspondence between counsel for Mr. Hutchison and counsel for SeaRiver concerning a new scheduling order and the selection of dates to bring the matter to trial, thereby evidencing the parties’ intent not to treat the case as abandoned. On appeal, SeaRiver contends that this correspondence is not part of the record but instead, was attached to Mr. Hutchison’s opposition, and therefore, it should not be considered by this court. Notably, the fact that the correspondence at issue was exchanged between counsel and the general substance of the correspondence are not disputed by SeaRiver.

At the hearing on this matter, SeaRiver objected to the correspondence being introduced into evidence solely on the basis that it was irrelevant because it was not a formal part of the trial court’s record as contemplated by La. C.C.P. art. 561 and the jurisprudence interpreting that article. Although the trial court did not specifically rule on SeaRiver’s objection, the objection was implicitly overruled when the trial court specifically stated on the record that it had considered all of the exhibits attached to both memoranda and found that the letters were relevant to its determination of whether there were any acts or causes outside of the record, such as discovery or a defendant’s/insurer’s unconditional tender of benefits, that had prevented the accrual of the abandonment period. Because SeaRiver did not appeal the trial coui’t’s evidentiary ruling in this regard, we find it appropriate to consider the correspondence at issue.

In a letter dated September 6, 2007, counsel for SeaRiver stated to counsel for Mr. Hutchison: “This follows our earlier telephone conversation regarding the captioned matter. Please forward your proposed dates so that we may file a [scheduling [ojrder with the [cjourt.”

By letter dated November 7, 2007, counsel for Mr. Hutchison responded to 19counsel for SeaRiver as follows: “Enclosed please find a form supplied by [the trial court], which they request we use to select our recommended deadlines. I have selected a pre-trial date in July, 2008, together with corresponding cut off dates. If this is acceptable, please sign where appropriate and return to my office.” Enclosed with the November 7, 2007 letter was a scheduling order form, signed by counsel for Mr. Hutchison, that provided a discovery cut off date of June 16, 2008, that all pleadings would be filed by July 1, 2008, that the parties would exchange pretrial inserts by July 16, 2008, and that the pretrial order would be filed by July 18, 2008.

On March 6, 2008, counsel for Mr. Hutchison sent a letter to counsel for SeaRiver, which provided: “I forwarded to your office on November 7, 2007 a copy of [the trial court’s] [proposed [scheduling [o]rder in the above captioned matter. I did not get a copy return [sic] to my office, and was curious to know whether or not you filed this with [the trial court] or if we still need to do so. If the form has not been forwarded to [the trial court], please let me know and I will send a signed copy to your office promptly.”

On June 26, 2008, Mr. Hutchison propounded a second set of written discovery requests to SeaRiver, and on July 15, 2008, counsel for Mr. Hutchison sent another letter to counsel for SeaRiver with another proposed scheduling order, requesting that counsel for SeaRiver sign the proposed order and forward it to the trial court.

After reviewing the correspondence between counsel, we find the defense-oriented jurisprudential exception to the abandonment rule applicable to this case. By virtue of the September 6, 2007 letter, counsel for SeaRiver specifically requested dates from counsel for Mr. Hutch-ison so that a scheduling order could be filed with the trial court. The ultimate purpose of a scheduling order is to hasten the matter to judgment by selecting deadlines for the parties to conclude all pretrial | ^matters. Therefore, requesting a scheduling order is an act inherently inconsistent with an intent to treat a case as abandoned. Thereafter, on November 7, 2007, counsel for Mr. Hutchison provided to counsel for SeaRiver a signed scheduling order on the form provided by the trial court, which set proposed discovery cutoff dates and pre-trial deadlines. Mr. Hutchi-son’s action in this regard clearly demonstrates his intent not to abandon his case. However, for reasons that are not disclosed in this record, the scheduling order was never filed with the trial court.

Generally, we recognize that extra-judicial efforts, such as informal discussions, settlement negotiations, correspondence, or contact between the parties have uniformly been considered insufficient to constitute a step for purposes of interrupting or waiving abandonment. See Clark, 2000-3010 at p. 16, 785 So.2d at 790; Brown, 2008-0919 at pp. 11-12, 5 So.3d at 267; Compensation Specialties, L.L.C., 2008-1549 at p. 9, 6 So.3d at 281. However, this case presents a very different situation. It does not involve an attempt to use informal correspondence between the parties to demonstrate that a step in the prosecution of the case has occurred that is sufficient to interrupt or waive abandonment. Rather, it involves a defendant specifically requesting that the plaintiff provide proposed dates for pre-trial scheduling deadlines and a plaintiff responding to this request by submitting to the defendant a signed scheduling order on the form required by the trial court. That the scheduling order was never technically filed with the trial court is not as is important as the intent and purpose behind the actions of both SeaRiver and Mr. Hutchi-son, ie., that a scheduling order be entered to hasten the matter to trial and judgment.

Bearing in mind the policy considerations enunciated by our supreme court in Clark, 2000-3010 at p. 8 and p. 10, 785 So.2d at 785 and 787, that La. C.C.P. art. 561 is to be liberally construed in favor of maintaining a plaintiffs suit and that any doubt as to abandonment is to be construed in favor of maintaining a Inplaintiffs actions, we find that SeaRi-ver’s actions in this case demonstrated an intent not to treat this case as abandoned, thereby waiving its right to assert abandonment. Therefore, we find that SeaRi-ver’s actions are within the jurisprudential acknowledgement exception to the abandonment rule. Since Mr. Hutchison has undisputedly taken steps in the action within three years of SeaRiver’s acknowl-edgement, we find that the trial court erred in dismissing this action as abandoned.

IV. CONCLUSION

For the above and foregoing reasons, the December 16, 2008 judgment of the trial court granting the defendant’s motion and dismissing the plaintiffs action as abandoned is hereby reversed and the matter is remanded for further proceedings.

All costs of this appeal are assessed to the defendant/appellee, SeaRiver Maritime, Inc.

REVERSED AND REMANDED.

      . We note that in its oral reasons for judgment, the trial court stated that as of March 21, 2008, that the five-year abandonment period had passed with no action. However, as the trial court previously found that the March 21, 2005 scheduling order was the last step in the prosecution of the matter, the trial court clearly intended to state, in its reasons, that the three-year abandonment period had passed with no action.

      . See La. C.C.P. art. 1446(D) and 1474(C)(4).

      . Because of our ruling herein, we pretermit discussion of whether, pursuant to La. C.C.P. art. 561(A)(2) the five-year abandonment period for delays resulting from Hurricane Katrina is applicable to this case.