Breaux v. Avondale Industries, Inc. (2004)

Our plain-English summary of Breaux v. Avondale Industries, Inc. (Louisiana Court of Appeals, July 14, 2004).

Joseph Breaux and his wife Diane sued Avondale Industries (now Northrop Grumman Ship Systems) and Peter Territo in Louisiana over Mr. Breaux's exposure to asbestos in the 1960s. The opinion does not name his disease. In 2001 the Breauxes had settled claims over the same injuries with other defendants in Texas litigation, and they did not reserve their rights against others who might be jointly liable. The defendants argued that Louisiana law as it stood in the 1960s applied to the release. Under that law, a release without a reservation of rights could end claims against the other obligors. The trial court agreed and granted partial summary judgment for the defendants. The Court of Appeal reversed. It held that the release is a contract and is governed by the law in effect when it was signed in 2001. By then Louisiana no longer required a reservation of rights. The court distinguished Cole v. Celotex as a tort case and noted the Louisiana Supreme Court's reluctance to read Cole broadly. The case was remanded. One judge concurred in the result only.

We wrote this summary from the court's opinion with the help of AI. It is not the court's wording, and it is not legal advice. The full opinion is below.

The decision

• Court: Louisiana Court of Appeals, 4th Circuit
• Decided: July 14, 2004
• Citation: 880 So.2d 36
• Docket: No. 2004-C-1138
• Stage: Appeal from summary judgment
• State: Louisiana

Outcome. The Louisiana Court of Appeal granted the Breaux plaintiffs' writ application, reversed the trial court's partial summary judgment for Avondale/Northrop Grumman and Peter Territo, and remanded for further proceedings.

What the court held. A release is a contract, so its effect is governed by the law in effect when it was executed, not by the law in effect at the time of the asbestos exposure. Cole v. Celotex is not read expansively to reach contract questions.

Issues decided: Settlements and Releases.

The people and their exposure

• Joseph Breaux

The defendants

• Avondale Industries, Inc.
• Peter Territo

Decisions this opinion cites

Earlier decisions in our library that the court cited:

• Landry v. Avondale Industries, Inc. (Louisiana Supreme Court, 2004). The Louisiana Supreme Court reversed the court of appeal, reinstated the trial court's summary judgment for Reilly-Benton and Liberty Mutual that comparative fault applies to the wrongful death claim, and remanded; the Landry plaintiffs lost.
• Cole v. Celotex Corp. (Louisiana Supreme Court, 1992). The Louisiana Supreme Court affirmed the court of appeal: pre-comparative-fault (virile share) law governed, the nine executive officers counted as nine separate shares, and the insurer INA's annual policies could be stacked, so INA owed each of the three plaintiff workers $135,000 plus interest.

The court's opinion

The text below is Google Scholar's copy of the court's opinion, a public record. Numbers in brackets, such as [*921], mark where each page of the printed reporter begins.

880 So.2d 36 (2004)

Diane BREAUX, Wife of and Joseph Breaux

v.

AVONDALE INDUSTRIES, INC.

No. 2004-C-1138.

July 14, 2004.

Writ Denied July 20, 2004.

Court of Appeal of Louisiana, Fourth Circuit.

Scott R. Bickford, Christopher H. Sherwood, Tiffany Gautier Chase, Spencer Doody, Jeffrey Gewirtz, Martzell & Bickford, New Orleans, LA, for Plaintiffs/Relators.

Gary A. Lee, Richard M. Perles, A. Ann Cates, Patricia C. Penton, Lee, Futrell & Perles, L.L.P., New Orleans, LA, for Respondents, Peter Territo and Northrop [*37] Grumman Ship Systems, Inc., f/k/a Avondale Industries, Inc. (Court composed of Chief Judge JOAN BERNARD ARMSTRONG, Judge PATRICIA RIVET MURRAY and Judge JAMES F.

McKAY III).

JOAN BERNARD ARMSTRONG, Chief Judge.

We grant the relators' writ application in order to review the judgment of the trial court granting the respondents' motion for partial summary judgment.

In 2001, the relators settled their claims against certain defendants in Texas litigation brought for the same injuries that are the subject of the instant Louisiana lawsuit. It is argued that those defendants are solidarily liable with respondents for the relators' damages. In the Texas settlement, the relators did not reserve their rights against other solidary obligors.[1] The respondents suggest that the Supreme Court's holding in Cole v. Celotex Corp., 599 So.2d 1058 (La.1992) requires application of the law in effect at the time of the tortious acts complained of, Mr. Breaux's exposure to asbestos in the 1960s, to the Texas judgment recognizing the release.

Prior to January 1, 1985, Louisiana law required settling parties who wished to pursue non-settling solidary obligors to include in their releases language reserving their rights against such obligors. See, Former LSA-C.C. art. 2203. Acts 1984, No. 331, § 1 vacated that article and enacted LSA-C.C. art. 1803. Official Revision Comment (e) to LSA-C.C. 1803 notes the abrogation of the rule of LSA-C.C. 2203 (1970), according to which an obligee who remits a debt in favor of one solidary obligor without expressly having reserved his right against the others releases the solidary obligation. At the time the relators confected the release in Texas, Louisiana law no longer required that this reservation of rights be included in the release to protect a settling plaintiff's right to pursue his or her claims against non-settling solidary obligors. The critical distinction between the instant case and Cole is that Cole involved interpretation of tort laws. The issue before us involves contract law. Because the release at issue in this case is a contract, it is governed, absent an express provision in it to the contrary, by the law in effect at the time the release was executed. Laws existing at the time a contract is entered into are incorporated into and form a part of the contract as though expressly written. Green v. New Orleans Saints, 2000-0795 p. 6 (La.11/15/2000), 781 So.2d 1199, 1203, citing Board of Commissioners of Orleans Levee District v. Department of Natural Resources, 496 So.2d 281, 294 (La.1986). Since the release contains no such provision, the law in effect in 2001 controls the effect of the 2001 contract.[2]

While the trial court's partial summary judgment is a reasonable extension of the Cole holding, an expansive reading of Cole approved on similar facts by the Court of Appeal, First Circuit in Hebert v. Anco, 2000-1929 (La.App. 1 Cir. 7/31/02), 835 So.2d 483, we are guided to a different result by two relevant decisions of the Louisiana Supreme Court. [*38] In Walls v. American Optical Corp., 1998-0455 (La.9/8/99), 740 So.2d 1262, the court rejected an extension of Cole to wrongful death actions. The court noted that Cole should not be read so expansively as to require all long-latency

occupational lung diseases to be governed by all laws in effect on the date the victim was exposed to the disease causing agent. Walls at page 10, 740 So.2d at 1270. The facts of each individual case will dictate the law to be applied. Because Walls was a wrongful death claim, rather than a direct tort claim like Cole, the court held that since the wrongful death claim arose only after decedent's death, the controlling event was not exposure to asbestos, but rather the decedent's death, applying the law in effect at the time of death. Thus, the court held that a 1976 amendment to LSA-R.S. 23:1032 establishing executive officer immunity should be applied prospectively to the surviving plaintiffs' wrongful death action that arose when the decedent died, after the amendment's effective date. Significantly, the court held that the decision in Cole turned on unique language in the LCFL not present in the amendment to LSA-R.S.23:1032.

Similarly, in Landry v. Avondale Industries, 03-3432, 03-3434 and 03-3435 (La.7/2/04), 877 So.2d 970, a wrongful death action commenced after decedent's demise in 2002 from mesothelioma allegedly contracted as a result of asbestos exposure from 1959 to 1974, the Supreme Court declined to accept an expansive reading of Cole in the context of the Louisiana Comparative Fault Law (LCFL). The court applied the LCFL, enacted by Act 431 of 1979 and effective August 1, 1980, to the claim, since the cause of action arose in 2002 upon decedent's demise.

In the instant case, like both Walls and Landry, the relevant statute did not contain the unique language of the LCFL. Just as it was clear in Walls and Landry that the event most relevant to the wrongful death action was the decedent's death and not his initial exposure to asbestos, so also it is clear that the event most relevant to the release was the execution of the release itself. Because the release is a contract, separate and apart from the underlying damages that formed the consideration for the contract, we are guided by the nature of the release as a contract, deriving its validity and consequences from the law in effect at the time of its confection, and by the Supreme Court's expressed reluctance to read its Cole decision in an expansive manner in reaching our decision.

For the foregoing reasons, we grant the relators' writ application and reverse the trial court's judgment of July 2, 2004 granting the relators' motion for partial summary judgment, and remand to the trial court for further proceedings consistent with this writ disposition.

WRIT GRANTED; PARTIAL SUMMARY JUDGMENT REVERSED; REMANDED TO TRIAL COURT.

MURRAY, J., concurs and assigns reasons.

MURRAY, J. Concurs and Assigns Reasons.

I agree with the result reached by the majority on the basis that the release is a contract and, as such, is governed by the law in effect at the time of its execution. However, I do not accept the majority's suggestion that Walls v. American Optical Corp., supra, and Landry v. Avondale Industries, supra, provide additional authority for reaching the same result. Accordingly, I respectfully concur in the granting of the writ application and the reversal of the partial summary judgment. [1] Such a reservation of rights is not required by Texas law.

[2] A similar view is expressed in the dissent in Hebert v. Anco Insulation, Inc., infra. That "no reservation of rights was required in the settlement documents."

Sources

• The opinion on Google Scholar
• Louisiana asbestos laws
• Louisiana asbestos exposure sites