Billiot v. Multifamily Management ( 2022 )

Case: 20-30197 Document: 00516265649 Page: 1 Date Filed: 04/04/2022
United States Court of Appeals
for the Fifth Circuit United States Court of Appeals
Fifth Circuit
FILED
April 4, 2022
No. 20-30197 Lyle W. Cayce
Clerk
John Billiot; Jordy Lee; Taylor Roy,
Plaintiffs—Appellants,
versus
Multifamily Management, Incorporated; GMF-
Preservation of Affordability Corporation; XYZ
Insurance Company,
Defendants—Appellees.
Appeal from the United States District Court
for the Middle District of Louisiana
USDC No. 3:18-CV-715
Before Higginbotham, Smith, and Dennis, Circuit Judges.
Per Curiam: *
This contract and personal-injury-liability lawsuit arose after plaintiff
John Billiot’s Lawn Service agreed to provide lawncare at a property owned
by GMF Preservation of Affordability Corporation (“GMF”) through a
*
Pursuant to 5th Circuit Rule 47.5, the court has determined that this opin-
ion should not be published and is not precedent except under the limited circumstances
set forth in 5th Circuit Rule 47.5.4.
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No. 20-30197
contract with GMF and its agent, Multifamily Management, Inc. (“MMI”)
(collectively, “Defendants”). While on the property, Billiot and his employ-
ees, Jordy Lee and Taylor Roy (collectively, “Plaintiffs”), were injured dur-
ing a sequence of events allegedly resulting from an air conditioner’s falling
from a second-story window and hitting Billiot. While helping Billiot after he
was struck, Lee allegedly strained his back and Roy “crushed” his foot.
Plaintiffs initially filed suit in Louisiana state court, naming MMI and
GMF as defendants and asserting personal injury claims for damages related
to their injuries. Plaintiffs also asserted a breach of contract claim, alleging
that they were not paid for lawn care services provided. Defendants removed
the suit to federal court on the basis of diversity of citizenship under 28
U.S.C. § 1332. Concluding that Plaintiffs’ personal injury claims were pre-
scribed under La. Civ. Code Ann. art. 3492 and that Plaintiffs had failed
to state a plausible claim for breach of contract, the district court granted De-
fendants’ motions for summary judgment and to dismiss under Fed. R.
Civ. P. 12(b)(6). Plaintiffs appeal those rulings here.
I.
The standard of review for a district court’s grant of summary
judgment under Fed. R. Civ. P. 56 is de novo. Magee v. Reed, 912 F.3d 820,
822 (5th Cir. 2019). Summary judgment is appropriate “if the movant shows
that there is no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). A dispute
is genuine if the summary judgment evidence would enable a reasonable jury
to return a verdict for the non-movant. Hyatt v. Thomas, 843 F.3d 172, 177
(5th Cir. 2016).
The standard of review for a district court’s grant of a motion to
dismiss for failure to state a claim under Fed. R. Civ. P. 12(b)(6) is also de
novo. Gonzalez v. Kay, 577 F.3d 600, 603 (5th Cir. 2009). Although well-
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pleaded facts are accepted as true and viewed in the light most favorable to
the plaintiff, factual allegations must be sufficient to raise a right to relief
beyond the merely speculative level. Id. Thus, “[t]o survive a motion to
dismiss, a complaint must contain sufficient factual matter, accepted as true,
to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 570). To meet this
standard, a complaint must provide more than just conclusory statements;
“it must allege enough facts to move the claim ‘across the line from
conceivable to plausible.’” Turner v. Pleasant, 663 F.3d 770, 775 (5th Cir.
2011) (quoting Twombly, at 570).
II.
A. Personal Injury Claims
Plaintiffs challenge the district court’s determination that their per-
sonal injury claims are prescribed and the district court’s resulting grant of
summary judgment to Defendants. Under Louisiana’s Civil Code, delictual
actions, including personal injury claims, are subject to a liberative prescrip-
tive period of one year beginning from the day of the injury. La. Civ. Code
Ann. art. 3492. In this case, the alleged injuries occurred on August 23,
2017. Therefore, unless prescription was interrupted, the personal injury
claims prescribed on August 23, 2018. To interrupt prescription, a plaintiff
must file an action in a court of competent jurisdiction and venue, or properly
serve the defendant, within the prescriptive period. La. Civ. Code Ann.
art. 3462.
Here, Plaintiffs filed suit on June 21, 2018, which was within the pre-
scriptive period, but, as is undisputed, they did so in a court of incompetent
venue. Under Louisiana’s Civil Code, venue would have been proper in East
Baton Rouge Parish or Orleans Parishes, where, respectively, the Defend-
ants’ principal places of business are located, or in Calcasieu Parish, where
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the accident occurred, the contract was executed, and the work was per-
formed. 2 However, Plaintiffs filed in Point Coupée Parish.
As noted, Defendants then removed the suit to the United States Dis-
trict Court for the Middle District of Louisiana on July 26th, 2018, prior to
the date of prescription. Before the district court, Plaintiffs argued that they
properly served Defendants or, alternately, that removal to federal court re-
lieved them of their duty under Louisiana law to interrupt prescription.
GMF’s agent for service of process in Tennessee was indeed served
on July 11th, 2018, and MMI’s agent for service of process in Alabama was
served on or about July 17th, 2018. Service was ostensibly attempted under
Louisiana’s long-arm statute. However, the district court found that service
improper as a matter of law, as Louisiana’s Civil Code allows only foreign
corporations to be served via the state’s long-arm statute. 3 Both defendant
corporations had a designated agent for service of process in Louisiana; thus,
2
See La. Code Civ. Proc. Ann. art. 42 (“The general rules of venue are that
an action against: . . . (4) A foreign corporation or foreign limited liability company licensed
to do business in this state shall be brought in the parish where its principal business estab-
lishment is located as designated in its application to do business in the state . . . .); id. art.
76.1 (“An action on a contract may be brought in the parish where the contract was exe-
cuted or the parish where any work or service was performed or was to be performed under
the terms of the contract.”); id. art. 74 (“An action for the recovery of damages for an
offense or quasi offense may be brought in the parish where the wrongful conduct occurred,
or in the parish where the damages were sustained.”); id. art. 45 (“If . . . there is a conflict
between two or more of Articles 42 and 71 through 77, the plaintiff may bring the action in
any venue provided by any applicable article.”).
3
LA. CIV. CODE ANN. art. 1261(B) (Service may be effected via long-arm only
“[i]f the corporation has failed to designate an agent for service of process, if there is no
registered agent by reason of death, resignation, or removal, or if the person attempting to
make service certifies that he is unable, after due diligence, to serve the designated agent .
. .”).
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the district court reasoned, they could not have been properly served pursu-
ant to the long-arm statute.
On appeal, Plaintiffs do not challenge the district court’s
determination that Defendants were not properly served under Louisiana law
before the prescriptive period expired. Rather, they argue that upon removal
to federal court the Federal Rules of Civil Procedure supplanted the
otherwise applicable Louisiana law on prescription, and that service was
timely and proper under FED. R. CIV. P. 81(c).
We disagree that removal to the district court relieves a plaintiff of the
obligation under state law to interrupt prescription. The district court
properly relied on this court’s precedent in Mullen v. Sears, Roebuck, & Co. in
concluding that Defendants could assert prescription due to improper venue
and insufficient service as a defense to this suit, and that they had not waived
this defense by removing it to what would have been a proper federal venue.
887 F.2d 615 (5th Cir. 1989). In Mullen, we held that removal to federal court
did not interrupt prescription under Article 3492.
Plaintiffs argue that Mullen is distinguishable because there the case
had been removed from an improper state court venue to a proper federal
court venue after the end of the prescriptive period, whereas here removal to
a federal court with proper venue occurred before prescription ran. How-
ever, Plaintiffs misquote Mullen in claiming that the case stated that “re-
moval did not deprive a defendant of a limitations defense available under
state law at the time of removal.” 4 Relying on this erroneous quotation, they
argue that, because the removal here occurred before the end of the prescrip-
tive period, the defense of prescription was not available in state court at the
4
The language that Plaintiffs’ purport to quote from Mullen does not in fact appear
in the opinion.
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time of removal, and thus the defense was not available after removal to federal
court. 5
A close reading of Mullen belies this argument. Mullen did not limit
its ruling to defenses available in state court at the time of removal; in fact, it
stated that finding removal to waive the defense of prescription under La.
Civ. Code art. 3492 “would have the anomalous effect of rendering Article
3462’s service requirement inapplicable in every removed action even though
the statute is fully applicable in Louisiana suits and in diversity suits filed origi-
nally in federal court. Such differing measures of the cause of action would
step on Erie R. Co. v. Tompkins.” 6 Mullen, 887 F.2d at 617 (emphasis added);
see also Guar. Tr. Co. of N.Y. v. York, 326 U.S. 99 (1945) (stating that Erie
requires the application of state statutes of limitations in federal court when
jurisdiction rests on diversity of citizenship). Other cases cited by the court
in Mullen also refute Plaintiffs’ argument that Mullen is distinguishable on
the grounds of post-prescription versus pre-prescription removal. In Ragan
v. Merchants Transfer & Warehouse Co., for example, the Supreme Court
stated:
[t]he force of th[e] reasoning [that the instant case is barred in
federal court, as the parties concede it would have been by the
statute of limitations if brought in the state court] is sought to
be avoided by the argument that the Federal Rules of Civil Pro-
cedure determine the manner in which an action is commenced
in the federal courts—a matter of procedure which the princi-
ple of Erie R. Co. v. Tompkins does not control. It is accordingly
5
See 5 Charles Alan Wright & Arthur R. Miller, Federal Prac-
tice and Procedure, § 1395 (1st ed. 1969) (“A party who removes an action from a
state to a federal court does not thereby waive any of his or her Federal Rule 12(b) defenses
or objections. . . . [T]he defendant may take advantage of any legitimate defense that would
have been available to him or her in the state court.”) (footnotes omitted).
6
Erie R. Co. v. Tompkins, 304 U.S. 64 (1938).
6
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argued that since the suit was properly commenced in the fed-
eral court before the Kansas statute of limitations ran, it tolled
the statute. . . . But in the present case we look to local law
to find the cause of action on which suit is brought. Since
that cause of action is created by local law, the measure of
it is to be found only in local law. It carries the same burden
and is subject to the same defenses in the federal court as in the
state court. It accrues and comes to an end when local law so
declares. Where local law qualifies or abridges it, the fed-
eral court must follow suit. Otherwise there is a different
measure of the cause of action in one court than in the
other, and the principle of Erie R. Co. v. Tompkins is trans-
gressed. We can draw no distinction in this case because
local law brought the cause of action to an end after, rather
than before, suit was started in the federal court. In both
cases local law created the right which the federal court was
asked to enforce. In both cases local law undertook to deter-
mine the life of the cause of action. We cannot give it longer
life in the federal court than it would have had in the state court
without adding something to the cause of action. We may not
do that consistently with Erie R. Co. v. Tompkins.
337 U.S. 530, 532–34 (1949), (internal citations and footnotes omitted) (em-
phasis added); see also Walker v. Armco Steel Corp., 446 U.S. 740 (1980) (hold-
ing that Fed. R. Civ. P. 3, which states that a civil action is “commenced”
upon filing a complaint with the court, did not toll or displace service require-
ments integral to state statutes of limitations.); Mullen, 887 F.2d at 617(“There is little doubt but that the service requirement in Article 3462 re-
flects a determination by the Louisiana legislature that absent proper venue,
only service provides adequate notice. . . . We are persuaded that the require-
ment is integral to the Louisiana prescriptive statutes[.]”)
This language directly contradicts Plaintiffs’ argument that Mullen is
distinguishable merely because it involves post-prescription removal. Plain-
tiffs provide no other argument that Mullen is inapplicable and we find no
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reason that it ought not apply here. Accordingly, we hold that, as in Mullen,
Plaintiffs’ personal injury claims are prescribed under La. Civ. Code art.
3492. 7
B. Breach of Contract Claims
Plaintiffs also argue that the district court erred in dismissing their
contract claims against MMI for failure to state a claim upon which relief can
be granted. 8 Plaintiffs aver that MMI breached the contract between the par-
ties by failing to pay them for lawn care services Plaintiffs provided. How-
ever, the plain language of the contract identifies MMI as GMF’s
7
Plaintiffs argue that Defendants waived their right to assert the prescription de-
fense on the grounds that: (1) either Defendants implicitly agreed that they had been
properly served via their notice of removal or due process imposed a ‘duty’ on Defendants
to waive service upon removing the case, or (2) Defendants relinquished the defense when
they requested an extension of time to answer in federal court. These arguments are easily
dismissed. Plaintiffs misconstrue the removal statute, 28 U.S.C. § 1446, as establishing
that Defendants could not remove this action to federal court without alleging that all par-
ties had been properly served and consented to the removal. But the removal statute con-
tains no such requirement. Additionally, Plaintiffs provide no support for their contention
that Defendants’ request for an extension of time constituted a waiver of the state prescrip-
tion defense, and they do not provide any evidence that Defendants undertook any action
for the purpose of keeping them in ignorance of the possibility of prescription. Nor do
Plaintiffs provide support for their claim that Defendants had a statutory or due process
duty to warn them of the pending prescription deadline before seeking a motion to extend
time to file their response. See Fed. R. App. P. 28(a)(8)(A) (stating that an appellant’s
brief must contain, inter alia, citations to the authorities on which the appellant relies). Fi-
nally, having concluded that Plaintiffs’ personal injury claims are prescribed, we decline to
address their alternate arguments, including that the indemnity clause contained in the con-
tract between the parties, which the district court found to waive Plaintiffs’ right to bring
these personal injury claims, is void as against Louisiana’s public policy, or that the district
court construed the indemnity clause too broadly.
8
Plaintiffs also argue that the district court erred in dismissing their breach of con-
tract claims against GMF. However, a careful review of the record leads us to agree with
the district court and Defendants that Plaintiffs have never in fact pleaded a claim for
breach of contract against GMF, but only against MMI. Thus, we decline to address this
argument.
8
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management agent alone and stipulates that it is not responsible for payment
under the contract. Therefore, we find no error in the district court’s
12(b)(6) dismissal of Plaintiffs’ contract claims.
III.
For the foregoing reasons, the judgment of the district court is
AFFIRMED.
9