Court: Louisiana Court of Appeal; February 24, 1986; Louisiana; State Appellate Court
A motor vehicle collision on September 15, 1975, resulted in Sylvester Dartez being injured when the car he was in was rear-ended by an 18-wheel tractor-trailer. The tractor-trailer was owned by Adam Dixon, leased by Big Chief Truck Lines, Inc. (Big Chief-Louisiana), and driven by Sammie Sossaman. At the time, Big Chief-Louisiana was owned by Big Chief Truck Lines of Texas, Inc., which in turn was owned by Stewart C. Bushong. Dartez filed a suit for damages on September 15, 1976, with service completed in early 1980. Following the accident, Bushong sold his interest in Big Chief-Louisiana on September 21, 1977, while guaranteeing its obligations under the stock sales agreement.
Dartez amended his petition to include Big Chief-Louisiana and its insurer, Early American Insurance Company. Big Chief-Louisiana filed a third-party demand against Big Chief-Texas and Bushong, who then third-partied Sossaman. Dartez later included Bushong and Big Chief-Texas, as well as his insurer, Safeway Insurance Company, as defendants. The trial court ruled in favor of Dartez, awarding him a total of $337,905.98, with Early American Insurance Company's liability limited to its policy limits. The court dismissed claims against Dixon, Big Chief-Texas, and Bushong while ordering Big Chief-Louisiana to recover indemnity from Big Chief-Texas and Bushong. Both Bushong and Big Chief-Texas appealed, arguing errors regarding indemnity and employment status of Sossaman, while Dartez challenged the refusal to rule in his favor against Big Chief-Texas and Bushong, as well as the adequacy of his damages. Big Chief-Texas and Bushong claimed that they were not liable for indemnity, asserting that the lawsuit did not constitute a liability incurred before the stock sale agreement.
Big Chief-Texas and Bushong argue that the trial court incorrectly determined they owed indemnity to Big Chief-Louisiana. The court established that a tortfeasor's liability arises at the time of injury, not at the time of the lawsuit or judgment. The injuries in question occurred on September 15, 1975, before the stock sales agreement was executed. The stock sales agreement specifies that the Shareholder (Big Chief-Texas) is accountable for liabilities incurred by the Company prior to the agreement's date, and it obligates the Shareholder to defend any claims arising from such liabilities. Stewart C. Bushong guaranteed the obligations under this agreement. It is established that indemnification for sole negligence requires clear intent within the contractual language. The agreement explicitly states that Big Chief-Texas is responsible for liabilities incurred before September 21, 1977, while liabilities incurred afterward fall to the Purchasers (LeJeune and Vidrine). Since the relevant accident occurred before the agreement's execution, the court concludes that Big Chief-Texas and Bushong are liable for the associated payments.
Big Chief-Texas and Bushong argue that Sossaman was an employee of Dixon, not Big Chief-Louisiana, and therefore they should not be held liable for his actions. The court emphasizes that its findings have significant weight and will not be overturned unless there is clear abuse of discretion. Determining the existence of an employer-employee relationship hinges on the level of control exercised over the individual, including aspects such as hiring, wage payment, and the authority to dismiss. The court notes that an employee acting on behalf of their employer, with or without authority, can create or negate an employer-employee relationship. In this case, Big Chief-Louisiana leased equipment from Dixon and employed him as a dispatcher who directed Sossaman and other drivers. Based on the evidence, the court concludes that Sossaman was indeed an employee of Big Chief-Louisiana, which had the right to control him, affirming their liability to Dartez.
Dartez asserts that the trial judge erred by not granting him judgment against Big Chief-Texas and Bushong, claiming they assumed the liabilities of Big Chief-Louisiana under the stock sales agreement. He also contends that the agreement serves as a stipulation pour autrui in his favor. However, the court reiterates that its factual findings are crucial and can only be overturned in cases of clear error. Since Dartez was not a party to the stock sales agreement, he cannot claim any rights or benefits from it. Nonetheless, he attempts to assert his position as a third-party beneficiary under Louisiana law, which allows a third person to enforce a stipulation in a contract if they consent to the benefits.
The promisee must intend to provide a benefit to a third party through the promisor's contract fulfillment, as established in Wagner, Truax Co. v. Barnett Enterprises. A stipulation pour autrui requires written documentation that clearly indicates the intent to confer a benefit to a third party, as noted in Fontenot v. Marquette Casualty Co. The benefit cannot be merely incidental to the contract, supported by HMC Management v. New Orleans Basketball Club. In the current case, there is no evidence of intent to benefit Dartez from LeJeune, Vidrine, or Big Chief-Texas, rendering Dartez’s error assignment without merit.
Dartez argues that the trial court erred by awarding insufficient damages, specifically criticizing the consideration of after-tax income in the general damages assessment. The trier of fact has broad discretion in determining damages, which appellate courts will only overturn in cases of clear abuse of discretion, as outlined in LSA-C.C. art. 1934(3) and supported by Perniciaro v. Brinch and Reck v. Stevens. Once a third party indicates intent to benefit, the contract cannot be dissolved without their consent.
The award review is complicated due to it being an in globo award, preventing a breakdown of individual damage elements. Dartez claims the award regarding lost wages is inadequate. Expert Dr. Jan Duggar calculated Dartez's wage losses to be significantly higher than the overall award, with total lost wages to date at $146,601.00 and future lost wages estimated between $272,323.00 and $580,000.00. In contrast, defendant's expert, Dr. Kenneth Boudreaux, calculated past lost wages at $103,711.21, or after-tax at $79,298.37, based on similar parameters.
Dr. Boudreaux calculated Dartez’s future lost wages using a 12% discount rate and a 6.5% wage increase rate. If Dartez cannot work, his pre-tax future lost wages are estimated at $218,996.32, with after-tax losses at $189,151.65. If Dartez works at minimum wage, pre-tax losses are $134,113.74, and after-tax income is $112,826.38. Both parties' medical experts agree on the severity of Dartez's injuries, including a ruptured disc at the L4-5 level requiring multiple surgeries and hospitalizations. A recent examination indicated fragmented bone grafting, necessitating potential spinal refusion. Dartez suffers from severe, constant pain, limiting his ability to engage in previous recreational activities and perform heavy manual labor.
However, rehabilitation experts disagreed on Dartez's employment prospects. Ms. Chalfin, Dartez's specialist, deemed job opportunities unlikely, while Dr. Gorman, representing the defendants, believed retraining could enable Dartez to secure at least minimum wage employment despite his limitations. The trial court awarded Dartez $325,000.00 in damages, a decision affirmed by the reviewing court, indicating no abuse of discretion.
The appeal affirmed the trial court's ruling, with costs assessed equally against the appellants. The car Dartez was in was owned by him and driven by Joseph R. Clues. No appeal was made regarding the dismissal of Adam Dixon, making that decision final. Additionally, the court noted that no judgment was rendered on the third-party demand from Bushong and Big Chief-Texas. Dartez claimed Big Chief-Texas was responsible for the vehicle operation per the lease agreement with Dixon, but the agreement was actually between Dixon and Big Chief-Louisiana, which retained public responsibility under the lease. The legal context references Acts 1984, No. 331, which relates to third-party beneficiary rights in contracts.
