RODERICK F. LEE
THOMAS D. SAPP, STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, BMW FINANCIAL SERVICES, N.A., L.L.C. AND FINANCIAL SERVICES VEHICLE TRUST, INC.
FROM CIVIL DISTRICT COURT, ORLEANS PARISH NO. 2010-07164,
DIVISION "G-11" Honorable Robin M. Giarrusso, Judge
Roderick F. Lee, Pro Se COUNSEL FOR PLAINTIFF/APPELLANT
Charles R. Rumbley LOBMAN, CARNAHAN, BATT, ANGELLE &
NADER COUNSEL FOR DEFENDANT/APPELLEE
composed of Judge Rosemary Ledet, Judge Paula A. Brown, Judge
Marion F. Edwards, Pro Tempore
ROSEMARY LEDET JUDGE.
is a personal injury case. The plaintiff, Roderick Lee,
appeals the trial court's March 6, 2017 judgment,
granting a partial peremptory exception (the
"Exception"). The Exception was filed by the
defendant, State Farm Mutual Automobile Insurance Company
("State Farm"), in its capacity as the liability
insurer of the alleged tortfeasor, Thomas Sapp. The judgment,
which sustained the Exception, dismissed a portion of the
insurance "bad faith" claims that Mr. Lee asserted
against State Farm. For the reasons that follow, we convert
the appeal to an application for supervisory writs, grant the
writ application, and deny relief.
AND PROCEDURAL BACKGROUND
August 2009, Mr. Lee was involved in an automobile accident
with Mr. Sapp. The accident occurred on Prytania Street in
New Orleans, Louisiana; the vehicle that Mr. Sapp was driving
collided with the vehicle that Mr. Lee was driving. In July
2010, Mr. Lee filed suit, naming as defendants, among others,
Mr. Sapp and his alleged automobile liability insurer, State
Farm. In his petition, Mr. Lee prayed for damages for his
personal injuries incurred in the accident as the result of
Mr. Sapp's alleged negligence; he asserted no property
damage claim. In its capacity as Mr. Sapp's alleged
insurer, State Farm answered the suit, averring that Mr.
Sapp's policy was not in effect on the date of the
accident and, therefore, denying coverage for the accident.
In March 2012, Mr. Lee filed a First Amended and Supplemental
Petition, asserting a negligent entrustment claim against the
lessor of the vehicle that Mr. Sapp was
prior appeal, this court held that coverage existed at the
time of the accident. Lee v. Sapp, 14-1047 (La.App.
4 Cir. 3/4/15), 163 So.3d 60 ("Sapp I
"). In July 2016, Mr. Lee filed a Second
Amended and Supplemental Petition, asserting insurance
"bad faith" claims against State Farm. For the
first time, Mr. Lee averred that State Farm was not only Mr.
Sapp's insurer, but also his insurer. He also averred
that State Farm was his uninsured or underinsured motorist
August 2016, Mr. Lee entered into a settlement agreement with
Mr. Sapp and State Farm (the "Release"). In the
Release, Mr. Lee settled all his claims against Mr. Sapp and
State Farm, in its capacity as Mr. Sapp's insurer,
arising out of the August 2009 accident with the exception of
certain "Reserved Claims." The Release defined the
term "Reserved Claims" to mean "all bad faith
claims asserted by Plaintiff against State Farm Mutual
Automobile Insurance Company in the Second Supplemental and
Amended Petition for Damages."
September 2016, State Farm filed the Exception, seeking
dismissal of all the Reserved Claims, except for Mr.
Lee's claims for misrepresentation under La. R.S.
22:1973(B)(1), which were expressly carved out of the
Exception. Following a hearing, the trial court
sustained the Exception. This appeal followed.
reaching the merits of this appeal, we must first address the
jurisdictional issue that State Farm raises regarding whether
the March 6, 2017 judgment is an appealable, final
judgment. State Farm contends that because the
judgment is only a partial final judgment and because the
trial court did not designate the judgment as appealable
under La. C.C.P. art. 1915 ("Article 1915"), the
judgment is non-appealable and, thus, the appeal should be
dismissed. Mr. Lee counters that "[t]he judgment was
designated a final judgment on that Peremptory Exception
alone" and, thus, the appeal should not be dismissed.
judgment that only partially determines the merits of the
action is a valid partial final judgment (and therefore
appealable) only if authorized by Article 1915."
Rhodes v. Lewis, 01-1989, p. 3 (La. 5/14/02), 817
So.2d 64, 66 (quoting Douglass v. Alton Ochsner Med.
Found, 96-2825 (La. 9/13/97), 695 So.2d 953). Article
1915 has two subparts-Subparts A and B. See Quality
Envtl. Processes, Inc. v. Energy Dev. Corp., 16-0171,
16-0172, p. 6 (La.App. 1 Cir. 4/12/17), 218 So.3d 1045, 1053.
The judgment granting State Farm's Exception- a partial
peremptory exception-falls under Subpart B,  which
"provides that when a court renders a partial judgment,
partial motion for summary judgment, or exception in part, it
may designate the judgment as final when there is no just
reason for delay." Id.; see also Favrot v.
Favrot, 10-0986, pp. 2-3 (La.App. 4 Cir. 2/9/11), 68
So.3d 1099, 1102.
B of Article 1915 has two subparts. The first subpart
provides that "the judgment shall not constitute a final
judgment unless it is designated as a final judgment by the
court after an express determination that there is no just
reason for delay." La. C.C.P. art. 1915(B)(1). The
second subpart provides that "[i]n the absence of such a
determination and designation, any such order or decision
shall not constitute a final judgment for the purpose of an
immediate appeal and may be revised at any time prior to
rendition of the judgment adjudicating all the claims and the
rights and liabilities of all the parties." La. C.C.P.
art. 1915(B)(2); see also La. C.C.P. art. 1911(B)
(providing, in part, that "[n]o appeal may be taken from
a partial final judgment under Article 1915(B) until the
judgment has been designated a final judgment under Article
record reflects that the trial court did not designate the
judgment as "final" and immediately appealable
pursuant to La. C.C.P. art. 1915(B). Because the trial court did
not designate the judgment as final and immediately
appealable, it is a non-appealable judgment. Nonetheless,
this court has exercised its discretion to convert an appeal
of a non-appealable judgment into an application for
supervisory writs when the following two conditions are met:
(i) The motion for appeal has been filed within the
thirty-day time period allowed for the filing of an
application for supervisory writs under Rule 4-3 of the
Uniform Rules, Courts of Appeal.
(ii) When the circumstances indicate that an immediate
decision of the issue sought to be appealed is necessary to
ensure fundamental fairness and judicial efficiency, such as
where reversal of the trial court's decision would
terminate the litigation.
Mandina, Inc. v. O'Brien, 13-0085, pp. 7-8
(La.App. 4 Cir. 7/31/13), 156 So.3d 99, 104 (quoting
Delahoussaye v. Tulane Univ. Hosp. and Clinic,
12-0906, 12-0907, pp. 4-5 (La.App. 4 Cir. 2/20/13), 155 So.3d
current case, both conditions are met. Mr. Lee's motion
for appeal was filed within thirty days of the date of the
notice of judgment and fundamental fairness and judicial
efficiency warrant the exercise of our discretion.
Accordingly, we convert the appeal to an application for
supervisory writs. See Stelluto v. Stelluto,
05-0074, p. 7 (La. 6/29/05), 914 So.2d 34, 39 (noting that
"the decision to convert an appeal to an application for
supervisory writs is within the discretion of the appellate
sole issue presented is whether the trial court erred in
granting the Exception, which State Farm entitled a
"Peremptory Exception of No Cause of Action and No Right
of Action." As one commentator has noted,
"[b]ecause the distinction between no cause of action
and no right of action is elusive, attorneys frequently plead
an 'exception of no cause or right of action.' There
is no such procedural device." 1 Frank L. Maraist, LA.
CIV. L. TREATISE, CIVIL PROCEDURE § 6:7 (2d ed. 2017).
No cause of action and no right of action are separate
peremptory exceptions; each of these exceptions serves a
different purpose, and each is governed by different
procedural rules. Badeaux v. Southwest Computer Bureau,
Inc., 05-0612, 05-719, p. 6 (La. 3/17/06), 929 So.2d
of the primary differences between the exception of no right
of action and no cause of action lies in the fact that the
focus in an exception of no right of action is on whether the
particular plaintiff has a right to bring the suit, while the
focus in an exception of no cause of action is on whether the
law provides a remedy against the particular defendant."
Badeaux, 05-0612, 05-719, at p. 6, 929 So.2d at
1216-17. An important procedural distinction between the two
exceptions is that evidence may be introduced on an exception
of no right of action; whereas, "[n]o evidence may be
introduced at any time to support or controvert the objection
that the petition fails to state a cause of action." La.
C.C.P. art. 931.
exceptions of no cause of action and no right of action
present legal questions; hence, appellate courts review trial
court judgments granting such exceptions under a de
novo standard. Zeigler v. Housing Auth. of New
Orleans, 12-1168, p. 6 (La.App. 4 Cir. 4/24/13), 118
So.3d 442, 449 (citing St. Pierre v. Northrop Grumman
Shipbuilding, Inc., 12-545, p. 7 (La.App. 4 Cir.
10/24/12), 102 So.3d 1003, 1009); B-G & G Investors
VI, L.L.C. v. Thibaut HG Corp., 08-0093, p. 2 (La.App. 4
Cir. 5/21/08), 985 So.2d 837, 840.
place the issue presented here in context, we begin by
briefly outlining the well-settled principles governing
insurance "bad faith" claims in Louisiana.
"Insurance 'bad faith' law is codified in La.
R.S. 22:1892 (formerly La. R.S. 22:658) and La. R.S. 22:1973
(formerly La. R.S. 22:1220)." Dean A. Sutherland,
Insurance "Bad Faith" Law, Revisited, 57
La. B.J. 374, 375 (2010) ("Sutherland").
The purpose of these penalty statutes is to "provide
remedies to insureds whose insurance claims are improperly
handled or to whom payment is unreasonably delayed. In a few
instances, remedies are also provided to third-party
claimants." 15 William Shelby McKenzie and H. Alston
Johnson, III, LA. CIV. L. TREATISE, INSURANCE LAW &
PRACTICE § 11:1 (4th ed. 2017) ("McKenzie &
Section 22:1973(A) is broadly worded, the Louisiana Supreme
Court has interpreted that statutory provision as not giving
a third-party claimant the right to sue an insurer based upon
a generalized breach of its duty of good faith and fair
dealing. Kelly v. State Farm Fire & Cas. Co.,
14-1921, p. 6 (La. 5/5/15), 169 So.3d 328, 332-33 (citing
Theriot v. Midland Risk Ins. Co., 95-2895 (La.
5/20/97), 694 So.2d 184). In the Theriot, case, the
Supreme Court recognized that "La. RS. 22:1220(B)(1)-(5)
and La. R.S. 22:658 [now La. R.S. 22:1973(B) and La. R.S.
22:1892] do create certain limited causes of action
in favor of third party claimants that derogate from
established rules of insurance law." 95-2895 at p. 15,
694 So.2d at 193. The Supreme Court, however,
cautioned that these statutes must be strictly construed in
favor of "a limited expansion of third-party
rights." Theriot, 95-2895 at p. 16, 694 So.2d
limited nature of the insurance "bad faith" claims
available to third-party claimants is attributable to the
nature of the relationship between an insurer and a
third-party claimant. "The relationship between the
insurer and the third party claimant is neither fiduciary nor
contractual; it is fundamentally adversarial. For that
reason, a cause of action directly in favor of a third party
claimant is generally not recognized absent statutory
creation." Langsford v. Flattman, 03-0189, p. 3
(La. 1/21/04), 864 So.2d 149, 151 (citing Theriot,
95-2895 at p. 15, 694 So.2d at 193).
current case, State Farm, in the Exception, sought dismissal
of all the Reserved Claims, except for Mr. Lee's claims
for misrepresentation under La. R.S. 22:1973(B)(1), which
State Farm identified as the only valid third-party claims
pled in the petition. In support, State Farm contended that it
was sued only in the ...