Louisiana Court of Appeals Affirms Judgment in Favor of Defendant Companies in Property Damage Lawsuit

On February 27, 2012, a district court for the Parish of Lafayette ruled in favor of two defendants being sued by plaintiffs C.F. Kimball II and Linda R. Kimball for property damage. The first defendant, Luhr Bros. Inc. d/b/a Construction Aggregate, owns a shell yard across from the Kimballs’ property on the Vermilion River. The second defendant, Omni Marine Transportation, Inc., owns a vessel that made deliveries to the Luhr Bros. The Kimballs had asserted that both defendants had engaged in business activities that resulted in the destruction of a bulkhead belonging to and located on the Kimballs’ property. The defendants responded by saying that an exception to res judicata prevented the Kimballs from filing a lawsuit against both parties for such damages.

An exception to res judicata signifies that proceedings related to the same occurrence had already taken place and been concluded. Specifically, the defendants claimed that the parties had previously executed a Receipt, Release and Indemnity Agreement in 2002. The Kimballs acknowledged that such an agreement had been executed but claimed that the Release did not pertain to the bulkhead, which the Kimballs had only acquired in 2008. The Kimballs asserted that a Release could not be agreed to for property that was not even in existence at the time of the agreement.

The trial court ruled in favor of the defendants and dismissed the Kimballs’ lawsuit with prejudice, meaning that the Kimballs could not bring a new case on the same basis as the dismissed case. When a trial court rules in favor of the defendants on an exception of res judicata, any issue whose determination was essential to the judgment and already litigated is extinguished. Thus, the trial court found that the issue of destruction of property such as the bulkhead was essential to the proceedings that had already been litigated between the parties, that is, the proceedings that led to the production of the Receipt, Release and Indemnity Agreement.

The Kimballs appealed the trial court’s decision to the Louisiana Third Circuit Court of Appeal on the grounds of manifest error. The Kimballs claimed that res judicata did not apply under Louisiana state law because “the cause or causes of action asserted in the second suit did not exist at the time of the final judgment in the first litigation.” The Court of Appeal stated that whether the cause of action asserted in the present lawsuit had in fact existed at the time of the final judgment in the first lawsuit turned on the language of the Release of 2002.

The Release of 2002 provided that the plaintiffs would release the defendants from liability for property damage caused in exchange for a determined sum of money, $150,000. The defendants were released from any claims that the Kimballs asserted or could have asserted “for restoration of and/or protective measures for the Kimballs’ bank on the Vermilion River.” The Kimballs’ cause of action encompassed the installation of protective measures and stated that the Kimballs would now assume the obligation to implement any protective measures for the Kimballs’ bank on the Vermilion River.” The Court of Appeals noted that, since the Kimballs had accepted that they would be responsible for implementing any protective measures, the Kimballs were now barred from asserting a claim for damages of said protective measure, the bulkhead. The 3rd Circuit affirmed that the Release signed in 2002 preempted the Kimballs from now filing suit against the defendants on the grounds of res judicata.

With complicated procedural issues such as an exception of res judicata, a lawyer can help you determine whether or not to file a lawsuit.

If you need to speak to an attorney, contact the Bernaird Law Firm at 504-527-6225 for a free consultation.