Ruby McCall v. Louisiana Right of Way Services,inc.

STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT

WCA 20-351

RUBY MCCALL

VERSUS

LOUISIANA RIGHT OF WAY
SERVICES, INC.

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APPEAL FROM THE
OFFICE OF WORKERS’ COMPENSATION - # 4
PARISH OF ACADIA, NO. 19-04037
ANTHONY PAUL PALERMO, WORKERS’ COMPENSATION JUDGE

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BILLY HOWARD EZELL
JUDGE

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Court composed of Sylvia R. Cooks, Billy Howard Ezell, and Candyce G. Perret,
Judges.

AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.

Somer G. Brown
Cox Cox Filo Camel & Wilson
723 Broad Street
Lake Charles, LA 70601
(337) 436-6611
COUNSEL FOR PLAINTIFF/APPELLANT:
Ruby McCall

Forrest E. Guedry
Kean Miller LLP
PO Box 3513
Baton Rouge, LA 70821
(225) 387-0999
COUNSEL FOR DEFENDANT/APPELLEE:
Louisiana Right of Way Services, Inc.

EZELL, Judge.

Ruby McCall appeals a trial court judgment granting an exception of

prescription filed by Louisiana Right of Way Services, Inc. Ms. McCall claims that

her claim is not prescribed because the three-year prescriptive period provided by

La.Civ.Code art. 3494 applies to her claim for unpaid wages she filed pursuant to

La.R.S. 23:1163. For the following reasons, we agree that a three-year prescriptive

period applies.

FACTS

According to the record, Ms. McCall went to work for Louisiana Right of

Way Services, Inc., (LRWS) in 2012, as a project coordinator. Based on the

statements made at the hearing on the exception of prescription, LRWS is a business

that evaluates and appraises land for rights-of-way for use by telecommunications,

utility, or pipeline companies. LRWS claims that Ms. McCall was hired as an

independent contractor and that it had an agreement with her to deduct expenses for

her personal workers’ compensation coverage from the fees it owed her. This

practice was continued until April 2019, when Ms. McCall left employment with

LRWS.

On June 21, 2019, Ms. McCall filed a disputed claim for compensation

arguing that LRWS improperly deducted workers’ compensation premiums from her

wages. Suit was originally filed with the Office of Workers’ Compensation,

District 03 - Lake Charles, Louisiana. LRWS filed an exception of improper venue

because Ms. McCall’s residence and LRWS’s principal place of business are in

Acadia Parish, District 04 - Lafayette, Louisiana. The matter was transferred to

District 04 on July 25, 2019.

LRWS filed an exception of prescription on September 23, 2019, arguing that

the last alleged wrongful tortious conduct occurred in September 2017, when Ms.

McCall purchased her own workers’ compensation policy. The hearing was held on

December 6, 2019. A judgment was signed on January 23, 2020, granting the

exception of prescription. Pursuant to an agreement with all counsel, an amended

judgment was signed February 6, 2020, designating the judgment as a final judgment

and dismissing Ms. McCall’s claims against LRWS. Ms. McCall then filed the

present appeal.

PRESCRIPTION

The party pleading the exception of prescription bears the burden of proof

unless it is apparent from the face of the pleadings that the claim has prescribed; In

that case, the burden is on the plaintiff to prove that the claim has not prescribed.

Orsot v. Acadian Ambulance Serv., Inc., 19-863 (La.App. 3 Cir. 7/15/20), ___ So.3d

___. The standard of review applied by an appellate court in reviewing a grant of

an exception of prescription depends on whether evidence was presented at the

hearing on the exception. Id. A manifest error standard of review is applied if there

was evidence presented at the hearing. Id. If no evidence was offered at the hearing,

the appellate court must simply determine whether the trial court’s decision was

legally correct. Id. In that case, the appellate court reviews the issue de novo,

“giving no deference to the trial court’s legal determination.” Wells Fargo Fin. La.,

Inc., 17-413, p. 8 (La.App. 4 Cir. 11/15/17), 231 So.3d 793, 800.

In the present case, no evidence was offered at the hearing on the exception

of prescription. Therefore, we will determine whether the workers’ compensation

judge’s (WCJ) decision to grant LRWS’s exception of prescription was legally

correct.

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Ms. McCall argues that the WCJ committed legal error in applying a one-year

prescriptive period to her claim for unpaid wages she filed pursuant to La.R.S.

23:1163. Louisiana Revised Statutes 23:1163 provides:

A. It shall be unlawful for any employer, or his agent or
representative, to collect from any of his employees directly or
indirectly either by way of deduction from the employee’s wages,
salary, compensation, or otherwise, any amount whatever, or to demand,
request, or accept any amount from any employee, either for the
purpose of paying the premium in whole or in part on any liability or
compensation insurance of any kind whatever on behalf of any
employee or to reimburse such employer in whole or in part for any
premium on any insurance against any liability whatever to any
employee or for the purpose of the employer carrying any such
insurance for the employer’s own account, or to demand or request of
any employee to make any payment or contribution for any such
purpose to any other person.

B. Nothing herein shall be construed to prevent any employer
from carrying his own insurance towards his own employees; nothing
herein shall apply to an employer qualified under the laws of this state
to engage in the liability insurance business. In addition, nothing herein
shall be construed to prevent an independent contractor who is a sole
proprietor and who has elected by written agreement not to be covered
by the provisions of this Chapter in accordance with R.S. 23:1035 from
entering into a contract with his principal pursuant to which the
independent contractor is responsible for securing insurance or self-
insurance for the benefits provided pursuant to this Chapter or to reduce
payments to the independent contractor for coverage of the independent
contractor or his employees pursuant to a contract, nor shall it be a
violation of this Section if a principal has agreed to provide workers’
compensation insurance to all contractors working under a contract
with the principal and for the cost of this coverage to be a consideration
in the contract between the principal and the contractors.

C. Whoever violates any provision of this Section shall be fined
not more than five hundred dollars, or imprisoned with or without hard
labor for not more than one year, or both.

D. In addition to the criminal penalties provided for in
Subsection C of this Section, any person violating the provisions of this
Section shall be assessed civil penalties by the workers’ compensation
judge of not less than five hundred dollars and not more than five
thousand dollars payable to the employee and reasonable attorney fees.
Restitution shall be ordered up to the amount collected from the
employee’s wages, salary or other compensation. The award of

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penalties, attorney fees, and restitution shall have the same force and
effect and may be satisfied as a judgment of a district court.

In 2004, La.R.S. 23:1163 was amended by Acts 2004, No. 416, § 1, which

added Subsection D to La.R.S. 23:1163 to provide that an employer who unlawfully

collects workers’ compensation premiums from employees is potentially liable for a

civil penalty in addition to the already-existing criminal penalty provision. At the

same time, the Legislature also added the provision providing that an independent

contractor could enter into a contract with the principal agreeing that the independent

contractor would be responsible for securing workers’ compensation insurance or

paying for the premiums personally. Nothing in the statute says anything about the

prescriptive period for asserting an action against an employer for violation of the

statute.

Ms. McCall claims she is seeking payment of compensation for services she

rendered that were improperly deducted from her paycheck. Therefore, she claims

the applicable prescriptive period is found in La.Civ.Code art. 3494(1), which

provides: “The following actions are subject to a liberative prescription of three

years: (1) An action for the recovery of compensation for services rendered,

including payment of salaries, wages, commissions, professional fees, fees and

emoluments of public officials, freight, passage, money, lodging, and board[.]”

In Chevalier v. L.H. Bossier, Inc., 95-2075, p. 5 (La. 7/2/96), 676 So.2d 1072,

1076, the supreme court stated that “La.R.S. 23:1163 . . . has effect whether or not

an injury has occurred to an employee[.]” Clearly, La.R.S. 23:1163 has nothing to

do with a suit seeking workers’ compensation indemnity or medical benefits, which

are subject to a one-year prescriptive period as set forth in La.R.S. 23:1209.

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The proper characterization of the nature of the cause of action determines the

applicable prescriptive period. DePhillips v. Hosp. Serv. Dist. No. 1 of Tangipahoa

Par., 19-1496 (La. 7/9/20), ___ So.3d ___. Ms. McCall filed suit seeking payment

for amounts she claims were wrongfully deducted from her paycheck. Mrs. McCall

is not making a claim for any type of workers’ compensation benefits. We find that

La.Civ.Code art. 3494(1), regarding payment for services rendered, is the proper

statute to be applied and therefore, Ms. McCall had three years to file suit.

LRWS argues that even if La.Civ.Code art. 3494 is applicable, the exception

of prescription was properly granted as to Ms. McCall’s claim for unpaid wages. It

argues that the alleged deductions in the three years prior to it being served were

prescribed. LRWS further claims that Ms. McCall’s claim is prescribed as suit was

not timely filed. In support of this position, LRWS cites La.Civ.Code art. 3462

which provides that if suit is filed in a court of improper venue, prescription is only

interrupted by service of process within the prescriptive period.

Regarding the prescriptive period in La.Civ.Code art. 3494, La.Civ.Code art.

3495 provides that, “This prescription commences to run from the day payment is

exigible. It accrues as to past due payments even if there is a continuation of labor,

supplies, or other services.” As explained by Comment (b) to La.Civ.Code art. 3495,

“On principle, liberative prescription commences to run from the day a cause of

action arises and its judicial enforcement is possible.” A claim for payment of

wages is “exigible” when the “demand for payment can be made.” Monroe v.

Physicians Behavioral Hosp., LLC, 49,248, p. 12 (La.App. 2 Cir. 8/13/14), 147

So.3d 787, 794; Ledoux v. City of Baton Rouge, 99-2061 (La. 2/29/00), 755 So.2d

877; Orsot, ___ So.3d ___. “In cases dealing with salaries and wages, the demand

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for payment can be made as soon as the wages are earned and payable.” Monroe,

147 So.3d 794.

In Fishbein v. State of Louisiana Ex rel. LSUHSC, 04-2482 (La. 4/12/05), 898

So.2d 1260, the supreme court held that any claims for compensation that the

plaintiff had that were over three years old before suit was filed had prescribed.

However, suit by the plaintiff was timely as to any claims for recovery of

compensation that occurred within the three years prior to the filing of suit.

As previously stated, suit was filed in a court of improper venue but

transferred to a court of proper venue. The return receipt for the service of process

of the filing of suit indicates that it was served on June 28, 2016. Therefore, any

claim Ms. McCall has for improper deductions for workers’ compensation premiums

arising prior to June 28, 2016, three years prior to the date that LRWS was served,

are prescribed. Ms. McCall’s claim for improper deductions are timely as to any

claim arising as of June 28, 2016. Accordingly, we sustain the exception of

prescription asserted by LRWS as to any alleged claims for improper deductions

prior to June 28, 2019.

CONCLUSION

For the reasons set forth in this opinion, we find that the three-year

prescriptive period of La.Civ.Code art. 3494 is applicable to Ms. McCall’s claim for

the recovery of compensation for services rendered. The trial court was correct in

granting Louisiana Right of Way Services, Inc’s exception of prescription as to any

claims arising prior to June 28, 2016. Otherwise, the exception of prescription is

denied as to any claims arising as of June 28, 2016. We remand this case to the

Office of Workers’ Compensation for further proceedings consistent with this

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opinion. Costs of this appeal are assessed equally to Ruby McCall and Louisiana

Right of Way Services, Inc.

AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.

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