Opinion
24-C-110
05-31-2024
MARIE YUSUF AND ZEEHAN YUSUF v. LIGHTHOUSE PROPERTY INSURANCE COMPANY AND LOUISIANA INSURANCE GUARANTY ASSOCIATION
COUNSEL FOR PLAINTIFF/RELATOR, MARIE YUSUF AND ZEEHAN YUSUF SCOTT D. PEEBLES RAJAN PANDIT MATTHEW MIZE COUNSEL FOR DEFENDANT/RESPONDENT, LIGA DARREN A. PATIN NICOLE C. PALMISANO
ON APPLICATION FOR SUPERVISORY REVIEW FROM THE TWENTY-FOURTH JUDICIAL DISTRICT COURT PARISH OF JEFFERSON, STATE OF LOUISIANA NO. 831-873, DIVISION "J" HONORABLE STEPHEN C. GREFER, JUDGE PRESIDING
COUNSEL FOR PLAINTIFF/RELATOR, MARIE YUSUF AND ZEEHAN YUSUF SCOTT D. PEEBLES RAJAN PANDIT MATTHEW MIZE
COUNSEL FOR DEFENDANT/RESPONDENT, LIGA DARREN A. PATIN NICOLE C. PALMISANO
Panel composed of Judges Fredericka Homberg Wicker, Marc E. Johnson, and Stephen J. Windhorst
REVERSED IN PART;
AFFIRMED IN PART
SJW
FHW
MEJ
STEPHEN J. WINDHORST JUDGE
Plaintiffs/relators, Marie Yusuf and Zeehan Yusuf, seek review of the trial court's February 8, 2024 judgment, granting the motion to quash and/or motion for protective order to plaintiffs' notice of oral deposition pursuant to La. C.C.P. art. 1442 ("motion to quash") filed by defendant/respondent, Louisiana Insurance Guaranty Association ("LIGA"). For the following reasons, we reverse the trial court's ruling in part and deny the motion to quash in part.
PROCEDURAL BACKGROUND
In this insurance dispute, plaintiffs seek insurance payments under a policy issued by Lighthouse Property Insurance Company ("Lighthouse") for residential property damage caused by Hurricane Ida on August 29, 2021. Hurricane Ida destroyed parts of plaintiffs' home and valuables inside, and Lighthouse previously paid plaintiffs for a portion of these damages. Lighthouse, however, became insolvent on April 5, 2022 before satisfying plaintiffs' claim. As a result, LIGA became responsible for evaluating plaintiffs' claim and paying the remaining benefits due to plaintiffs, exclusive of statutory penalties or attorney's fees.
In evaluating plaintiffs' claim, LIGA hired an engineer and contractor to inspect plaintiffs' property. After these inspections, LIGA denied plaintiffs any additional benefits. During discovery, LIGA produced what purports to be Lighthouse's claim file, but plaintiffs claim the file is incomplete because it does not contain "claims notes" regarding the adjustment of plaintiffs' claim.
On November 30, 2023, plaintiffs noticed a La. C.C.P. art. 1442 deposition of a LIGA representative. In response, LIGA filed the motion to quash, asserting that the designated deposition topics were not relevant to the underlying dispute, would be more appropriately directed to an expert witness, and/or were related to penalties and attorneys' fees, which LIGA was not obligated to pay.
LIGA is not obligated to pay attorney's fees and penalties under La. R.S. 22:2055(6).
After a hearing, the trial court granted the motion to quash, stating as follows:
any information that could be gleaned from a deposition, a corporate deposition, if you will, of LIGA at this point, would really be directed towards their decision-making process, which goes to penalties or their -- whether they wanted to consider or not consider certain experts' opinions and not others. Again, I think all that goes towards penalties and those types of issues. I think any information regarding the actual facts of the case and their estimate of damages can be gleaned from the experts who have been deposed, or will be deposed, and any other witness who's going to testify to factual matters.
Plaintiffs filed this writ application, seeking reversal of the judgment granting the motion to quash.
LAW and ANALYSIS
Plaintiffs, herein, assert the trial court erred in granting LIGA's motion to quash. For the following reasons, we agree, grant this writ application, and reverse the trial court's judgment granting the motion to quash in part and deny the motion in part. We find the scope of the deposition of the LIGA representative should be limited as discussed below.
An essential premise of our justice system is that both sides to a dispute stand on equal footing in gathering evidence and preparing for trial. Hicks v. USAA Gen. Indem. Co., 21-840 (La. 3/25/22), 339 So.3d 1106, 1112. The scope of discovery is set forth in La. C.C.P. art. 1422:
Parties may obtain discovery regarding any matter, not privileged, which is relevant to the subject matter involved in the pending action, whether it relates to the claim or defense of the party seeking discovery or to the claim or defense of any other party, including the existence, description, nature, custody, condition, and location of any books, documents, or other tangible things and the identity and location of persons having knowledge of any discoverable matter. It is not ground for objection that the information sought will be inadmissible at the trial if the information sought appears reasonably calculated to lead to the discovery of admissible evidence.
The Louisiana discovery process is designed to (1) afford all parties a fair opportunity to obtain facts pertinent to their case, (2) discover the true facts and compel disclosure of these facts wherever they may be found, (3) assist the parties in preparing their cases for trial, (4) narrow and clarify the basic issues between the parties, and (5) facilitate and expedite the legal process by encouraging settlement or abandonment of less than meritorious claims. Hodges v. S. Farm Bureau Cas. Ins. Co., 433 So.2d 125, 129 (La. 1983); Nicholson v. Holloway Planting Co., 284 So.2d 898, 903 (La. 1973).
A party generally may obtain discovery of any information, not privileged, which is relevant to the subject matter involved in the pending action. Molaison v. Cust-O-Fab Specialty Servs., LLC, 21-585 (La.App. 5 Cir. 6/1/22), 343 So.3d 866, 872. The test of discoverability is not the admissibility of the particular information sought, but whether the information appears reasonably calculated to lead to the discovery of admissible evidence. Id. Discovery should be allowed where such discovery "relates to the claim or defense of the party seeking discovery or to the claim or defense of any other party, including the existence, description, nature, custody, condition, and location of any books, documents, or other tangible things and the identity and location of persons having knowledge of any discoverable matter." Id.
La. C.C.P. art. 1442 provides:
A party may in his notice name as the deponent a public or private corporation or a partnership or association or governmental agency and designate with reasonable particularity the matters on which examination is requested. The organization so named shall designate one or more officers, directors, or managing agents, or other persons who consent to testify on its behalf, and may set forth, for each person designated, the matters on which he will testify. The persons so designated shall testify as to matters known or reasonably available to the organization. This Article does not preclude taking a deposition by any other procedure authorized in this Chapter.In plaintiffs' notice of deposition to LIGA, they identified the following specific deposition topics:
1. Confirmation by a Custodian that each of the documents/records listed in Exhibit C:
a. is authentic: i.e., is a true, correct, and complete copy of the document/record;
b. was made at or near the time by, or from information transmitted by, a person with knowledge of the documented acts, events, conditions, opinions, or diagnoses, and was made and kept in the course of a regularly conducted business activity, and, it was the regular practice of that business activity to make and to keep the document/record, using trustworthy sources of information and methods and circumstances of preparation, with the recorded information furnished to the business by a person who was routinely acting for the business in reporting the information.
2. The scope and extent of damage to the Property caused by the Loss Event.
3. Repairs to the Property that are necessary to return the Property to the condition it was in immediately before the Loss Event.
4. Your receipt of satisfactory proof of loss caused by the Loss Event. 5. Your inspection(s) of the Property.
6. Your estimates, or estimates prepared by your agents, employees or contractors, of the cost of damage repairs made necessary by the Loss Event.
7. Your claims handling policies, procedures, and methodology for determining the amount of policy benefits You pay for claims that result from property damaged by hurricane storms in Louisiana in effect for the two years preceding the Loss Event through the day of this deposition.
8. Your claims handling policies, procedures, and methodology for determining the amount of policy benefits You paid for the Claim.
9. The date and amount of each payment You made on the Claim and the coverage(s) under which the payment(s) was made.
10. All exclusions that You contend apply to, or are implicated by, the Claim. 11. All conditions in the Policy that You contend Plaintiff failed to fulfill. 12. All procedures, policies or guidelines applicable to Your adjustment of the Claim.
13. All procedures, policies or guidelines upon which You relied to withhold, deny and/or authorize payments for this claim.
14. Your communications with Your agents, employees or contractors regarding adjustment or payment of the Claim.
15. All amounts You paid to Your agents, employees or contractors in connection with the Claim. We find that some, but not all, of the deposition topics set forth in plaintiffs' notice of deposition are relevant to the resolution of plaintiffs' claim, intended toseek the true facts, and necessary to assist plaintiffs in preparing their case for trial. We disagree with the contention that all topics are irrelevant and/or related to the issue of penalties and attorneys' fees, for which LIGA has no liability.
Relevant Topics
Topic 1 pertains to plaintiffs seeking to question a LIGA representative regarding LIGA's document production, to authenticate those documents, to qualify them as business records, and to inquire regarding documents plaintiffs believe are missing. Plaintiffs' request to question a LIGA representative about the documents LIGA produced and/or did not produce falls within permissible scope of discovery for this case.
Topics 2-6 are specific to LIGA's inspection, evaluation, and handling of plaintiffs' property damage claim. Topics 9 and 14-15 involve payments already made to plaintiffs, which also affects the extent of LIGA's remaining obligation, if any, to plaintiffs. These topics are clearly relevant to the resolution of whether LIGA is obligated to pay any additional amounts for plaintiffs' property damage claim.
Topics 10-11 pertain to whether the property damages are actually covered under the policy. Because the issue in this case depends on whether any additional damages are covered under the policy, we further find these topics are clearly relevant to the determination of whether LIGA is obligated to pay any additional amounts for plaintiffs' property damage claim.
Taking into account the liberal precepts applied to discovery, we conclude that plaintiffs are entitled to elicit testimony from LIGA, the defendant in this case, to develop the true facts related to the payment of their claim and to prepare their case for trial. We conclude at the very least the answers to those topics numbered 1-6, 9-11, and 14-15 may lead to the discovery of admissible evidence. For that reason, we order LIGA to designate a representative under La. C.C.P. art. 1442 to answer questions responsive to these subject matters.
Irrelevant Topics
We, however, find topics 7-8 and 12-13 relate to LIGA's general policies, procedures, and methodologies for evaluating, handling, and estimating claims are more likely to develop facts related to the issue of penalties and attorneys' fees, which are not at issue here. Thus, these topics are not relevant to the resolution of plaintiffs' claim and are not discoverable. Accordingly, we find that the scope of the LIGA deposition should not include topics 7-8 and 12-13, which are as follows: (a) claims handling policies, procedures, and methodology for determining the amount of policy benefits LIGA pays for claims that result from property damaged by hurricane storms in Louisiana in effect for the two years preceding the loss event through the day of this deposition; (b) claims handling policies, procedures, and methodology for determining the amount of policy benefits LIGA paid for plaintiffs' claim; (c) all procedures, policies or guidelines applicable to LIGA's adjustment of plaintiffs' claim; and (d) all procedures, policies or guidelines upon which LIGA relied to withhold, deny and/or authorize payments for plaintiffs' claim.
CONCLUSION
Considering the foregoing, we find the motion to quash should have been granted in part and denied in part. We grant this writ in part, reversing the trial court's judgment granting the motion to quash. We order LIGA to designate a representative to appear and respond to questions regarding those topics numbered 1-6 and 9-11, and 14-15 in the notice of deposition. We deny this writ in part as to topics 7-8 and 12-13, which pertain to issue of penalties and attorneys' fees. The designated LIGA representative is therefore not obligated to respond to questions on topics 7-8 and 12-13.
REVERSED IN PART;
AFFIRMED IN PART