Louisiana’s First Circuit Court of Appeal recently addressed whether Louisiana’s peremption statute applies to malpractice actions against attorneys not licensed to practice in Louisiana.

In Trans Pacific Interactive, Inc. v. U.S. Telemetry Corp., 16-0119 (La. App. 1 Cir. 9/16/16), 2016 WL 4942515, Trans Pacific Interactive, Inc. (“TPI”) sued its attorneys for providing legal counsel while the attorneys had an alleged conflict of interest.  The defendant-attorneys argued that TPI’s claims against them had prescribed.

Those attorneys were not licensed to practice law in Louisiana. Therefore, the Court first had to determine whether Louisiana’s peremption statute, La. R.S. 9:5605(A), applied to TPI’s claims.  That statute reads in pertinent part as follows (emphasis added):

No action for damages against any attorney at law duly admitted to practice in this state, . . . shall be brought unless filed . . . within one year from the date that the alleged act, omission, or neglect is discovered or should have been discovered . . . .

The Court held that the “clear express language in the statute” prohibited its application against the non-Louisiana attorneys. In other words, the peremptive period found in La. R.S. 9:5605 did not apply to TPI’s claims.  Rather, TPI’s claims were governed by Louisiana’s general one-year prescriptive period for tort actions. See La. Civ. Code art. 3492.  That prescriptive period begins to run from the date injury or damage is sustained. Id. Because the claims were subject to a prescriptive period rather than a peremptive period, prescription on those claims could have been interrupted or suspended.

The Court ultimately held that the lawsuit was prescribed since it was filed “more than a year after the date TPI had constructive knowledge of facts sufficient to incite its attention to the potential that a conflict of interest existed” for its attorneys.

We will continue to follow this case to determine whether writs will be taken to the Louisiana Supreme Court as it has the potential to have more far reaching effects if this decision stands. For example, under La. R.S. 9:5605, if a Louisiana attorney is involved, continuing representation does not affect the tolling period.  We anticipate that an argument will be made at some point (it was not made in this case at the First Circuit) that the application of La. R.S. 9:5605 to only Louisiana attorneys is unconstitutional as it creates a right in favor of Louisiana attorneys that is not enjoyed by out-of-state attorneys.

Allen & Gooch is providing this legal update for informational purposes only. This article should not be construed as legal advice or a legal opinion as to any specific facts or circumstances. You should consult your own attorney concerning your particular situation and any specific legal questions you may have.