Louviere v. Shell Oil Co. - 440 So. 2d 93 (La. 1983)

Rule:

When an employer's compensation insurer files suit to recover compensation benefits paid to an injured employee and thereby interrupts prescription on the employee's claim arising from the same cause of action, prescription is continuously interrupted during the pendency of the insurer's suit.

Facts:

On May 6, 1970, a heater on an offshore drilling platform owned by Shell Oil Company exploded. Plaintiffs Raymond Louviere and Charles Martinez, employees of Teledyne Movible Offshore, were injured in the explosion. Argonaut Insurance Company, Teledyne's compensation insurer, paid federal compensation benefits to plaintiffs and other similarly injured Teledyne employees. During the year following the explosion, several persons filed personal injury actions to recover damages incurred in the explosion. On May 5, 1971, Argonaut filed a suit in federal court which asserted that plaintiffs and other Teledyne employees had been injured in the explosion, that Argonaut had paid compensation benefits to these injured employees, and that Shell and other defendants were liable for the accident and were therefore obligated to reimburse Argonaut for the benefits paid to the injured employees. In 1973 and 1976, while the Argonaut suit was still pending, plaintiffs Louviere and Martinez filed the instant actions, demanding damages for personal injuries incurred in the explosion, against several defendants, including those named in the Argonaut suit. The federal district court dismissed both suits. Although acknowledging that the Argonaut suit interrupted prescription on behalf of these plaintiffs whose cause of action arose out of the same facts, the court concluded that prescription had been interrupted only momentarily by the filing of the Argonaut suit and had immediately begun to run anew, so that plaintiffs' suits, filed more than one year after the filing of the Argonaut suit, were untimely. The United States Court of Appeals, Fifth Circuit, certified a question of state law for review.

Issue:

Did the insurer’s suit interrupt prescription on the employee’s claim only momentarily?  

Answer:

No.

Conclusion:

In considering the question, the court noted that the reason for interruption in the first place was that the insurer was asserting part of the workers' cause of action. La. Rev. Stat. Ann. § 9:5801 supported that premise. As stated in La. Civ. Code Ann. art. 3463 (1982), which did not change existing law, an interruption of prescription continued during the pendency of the suit. The court held that when an employer's compensation insurer filed suit to recover compensation benefits paid to an injured employee and thereby interrupted prescription on the employee's claim arising from the same cause of action, prescription was continuously interrupted during the pendency of the insurer's suit.