Barbara Mcnorton Hovell v. Origin Bank F/k/a Community Trust Bank

Supreme Court of Louisiana
March 02, 2021
Clerk of Court
For the Court
The Supreme Court of the State of Louisiana
BARBARA MCNORTON HOVELL
VS.
ORIGIN BANK F/K/A COMMUNITY TRUST
BANK
No.2020-C-01417
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I
N RE: Origin Bank F/K/A Community Trust Bank - Applicant Defendant;
Applying For Writ Of Certiorari, Parish of Ouachita, 4th Judicial District Court
Number(s) 2016-2046-3, Court of Appeal, Second Circuit, Number(s) 53,527-CA;
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March 02, 2021
Writ application granted. See per curiam.
Weimer, C.J., would grant and docket.
McCallum, J., recused.
SJC
JDH
JTG
WJC
PDG
03/02/2021 "See News Release 008 for any Concurrences and/or Dissents."

03/02/21
S
UPREME COURT OF LOUISIANA
No
. 2020-C-01417
B
ARBARA MCNORTON HOVELL
VS.
ORIGIN BANK F/K/A COMMUNITY TRUST BANK
ON
WRIT OF CERTIORARI TO THE COURT OF APPEAL,
SECOND CIRCUIT, PARISH OF OUACHITA
PER CURIAM
The Louisiana Credit Agreement Statute provides: “ A debtor shall not
maintain an action on a credit agreement unless the agreement is in writing ,
expresses consideration, sets forth the relevant terms and conditions, and is signed
by the creditor and the debtor. ” La. R.S. 6:1122 (emphasis added). This Court has,
on multiple occasions, considered the LCAS, finding that the statute “precludes all
actions for damages arising from oral credit agreements, regardless of the legal
theory of recovery asserted.” Jesco Constr. Corp. v. Nationsbank Corp. , 02-0057,
p.4 (La. 10/25/07), 830 So. 2d 989, 992; King v. Parish Nat’l Bank , 04-337 (La.
10/19/04), 885 So. 2d 540 (same).
1
In this case, outside of the written loan documentation, the plaintiff alleges
that the defendant bank “was supposed to obtain” additional collateral to secure a
loan. He further alleges the defendant “was negligent and breached its commitment
to acquire additional collateral” to secure the loan. Though the petition attaches
1 Even earlier, in Whitney Nat’l Bank v. Rockwell, 94-3049 (La. 10/16/95), 661 So. 2d 1325, the
Court stated: “[T]he primary legislative purpose in enacting credit agreement statutes was to
establish certainty as to the contractual liability of financial institutions. . . . [T]he general goal
behind these credit agreement statutes is to increase the certainty in contractual liability in order
to reduce lender liability litigation.” 94 -3049, p.8, 661 So. 2d at 1330 (emphasis in original)
(internal citations omitted ). At the time, however, the Court declined to “adopt a blanket rule”
prohibiting all actions arising from oral credit agreements, regardless of legal theory asserted, as
we later did in Jesco.

documents related to the sale and loan, the petition does not attach any writing
expressing the defendant’s supposed agreement to secure additional collateral as
described above, and neither party argues that any such written agreement exists.
The plaintiff’s allegations plainly constitute an action for damages based upon
an oral credit agreement, which is expressly prohibited by statute. La. R.S. 6:1122.
We therefore reverse the decision of the Court of Appeal and reinstate the judgment
of the trial court, which granted the defendant’s exception of no cause of action and
dismissed plaintiff’s claims with prejudice.
REVERSED.