The Louisiana Supreme Court recently decertified as a class a lawsuit stemming from Hurricane Katrina that a lower court had previously found met the requirements for class action status.
The plaintiffs in the suit are residents of St. Bernard Parish whose homes were insured under policies written by Lafayette Insurance Co.
The lawsuit, Charles Dupree v. Lafayette Insurance Co., was filed Nov. 25, 2005. In it, Dupree and other plaintiffs maintained that their properties were damaged by wind during Hurricane Katrina and that they filed claims with Lafayette in a timely manner for coverage for those damages.
The petition alleges that “Lafayette denied or expressed an intent to deny coverage for the wind damage, by contending incorrectly that the roof damage, structural damage, and other damage to their properties were flood related and not caused by a covered peril, namely wind,” the Court explained in the opinion written by Justice J. Guidry.
The petition made other unfavorable assertions against Lafayette, including that the insurer “sought to force and coerce the plaintiffs into accepting settlements on their claims that Lafayette knew were unfair, unrealistically low, and inaccurately reflected the damage caused by the wind or the cost of repairing the wind damage,” according to the Court.
The petition also asserts that hundreds of properties in St. Bernard Parish were “were damaged and continue to be damaged as a result of Lafayette’s conduct ‘in denying and/or misdajusting and/or coercing [the plaintiffs] into accepting inadequate settlements,'” the Court wrote.
A motion for class certification was filed on March 31, 2006. The petition for class action sought to include “All persons whose property, located in Louisiana and covered by an insurance policy issued by defendant, sustained wind damage in connection with Hurricane Katrina on or about 29 August 2005 and whose claim for wind related damage to their property has been denied, in toto or partially, or misadjusted by Lafayette Insurance Company and/or its adjusters and/or other representatives.”
A trial court subsequently granted an amended motion for class action and on appeal the determination was affirmed. The appeals court returned the matter to the trial court with instructions for the lower court to correct some of the language in the petition’s definition of the class.
Upon review, however, the state Supreme Court found that the trial court “erred in finding common factual or legal issues exist” in the case as required by applicable sections of Louisiana’s civil code.
“The trial court also erred in finding, under La. Code Civ. Proc. art. 591(B)(3), that common substantive issues of law or fact predominate over individual questions and that the class action procedure is superior to other available methods for fairly and efficiently adjudicating the claims asserted. Accordingly, we conclude the trial court abused its discretion in certifying the class,” Justice Guidry wrote.
The Court reversed the rulings of the trial and appeal courts regarding class certification and remanded the case for further consideration.