At the time of the 2013 accident, he lived in the household of his mother, Deborah Forvendel, who also was insured by State Farm.

Mr. Forvendel sought to recover under his mother's State Farm UM policy, which carried significantly higher policy limits than his policy. State Farm refused to allow him to recover under his mother's policy, citing the anti-stacking provisions of La. R.S. 22:1295(1)(c).

As a result, Mr. Forvendel sued State Farm. He alleged that the facts of his case were strikingly similar to an earlier 2007 accident in which State Farm allowed him to recover UM benefits under both his own UM policy and his mother's UM policy.

At trial, Mr. Forvendel offered evidence regarding the 2007 accident. In particular, he relied on a June 9, 2008 letter from a State Farm manager to Mr. Forvendel's attorney. This letter referenced the 2007 accident and Mr. Forvendel's claim under his mother's policy, stating, “your client does qualify as an insured for Uninsured Motorist coverage.” Thereafter, State Farm allowed Mr. Forvendel to recover under both policies for the 2007 accident.

Ms. Forvendel testified that State Farm had not notified her of any error in permitting Mr. Forvendel's recovery under her policy in 2007.

State Farm's representative, Aaron Angel, testified that the 2007 payment had been made in error. Paul Robichaux, a State Farm Auto team manager in 2008, testified that the 2007 claim had been referred to him to consider whether Mr. Forvendel, as a resident relative, could select UM coverage under Ms. Forvendel's policy, but he had not considered the anti-stacking statute. Mr. Robichaux stated that he had been unaware that Mr. Forvendel had collected UM benefits under his own policy at the time, and he had not made any determination regarding stacking.

At the conclusion of the trial, the trial court entered judgment for Mr. Forvendel in the amount of $50,000 in damages, plus interest and costs. The trial court explained that State Farm had “previously interpreted the agreement between the parties to cover [Mr. Forvendel] under his mother's UM policy, and this fact can be considered by the Court in interpreting the agreement between the parties in effect at the time of the 2013 accident.”

State Farm appealed. In a split decision, the court of appeal affirmed, concluding that the trial court had not erred in finding that State Farm had waived defense to the 2013 claim by paying the 2007 claim in error.

The case reached the Louisiana Supreme Court.

Louisiana Law

La. R.S. 22:1295(1)(c) provides:

(c) If the insured has any limits of uninsured motorist coverage in a policy of automobile liability insurance, in accordance with the terms of Subparagraph (1)(a) of this Section, then such limits of liability shall not be increased because of multiple motor vehicles covered under such policy of insurance, and such limits of uninsured motorist coverage shall not be increased when the insured has insurance available to him under more than one uninsured motorist coverage provision or policy; however, with respect to other insurance available, the policy of insurance or endorsement shall provide the following with respect to bodily injury to an injured party while occupying an automobile not owned by said injured party, resident spouse, or resident relative, and the following priorities of recovery under uninsured motorist coverage shall apply:

(i) The uninsured motorist coverage on the vehicle in which the injured party was an occupant is primary.

(ii) Should that primary uninsured motorist coverage be exhausted due to the extent of damages, then the injured occupant may recover as excess from other uninsured motorist coverage available to him. In no instance shall more than one coverage from more than one uninsured motorist policy be available as excess over and above the primary coverage available to the injured occupant.

The Louisiana Supreme Court's Decision

The court reversed.

In its decision, the court explained that Mr. Forvendel did not dispute that the Louisiana anti-stacking statute applied to his claim but that he argued that State Farm had waived its right to assert this defense based on its actions in connection with his earlier 2007 accident.

The court acknowledged that, in Steptore v. Masco Constr. Co., 643 So.2d 1213 (La. 1994), it held that an insurer waived its right to assert a coverage defense by assuming and continuing the defense of its insured in the face of facts indicating that it had a right to deny coverage for the accident. It then found Steptore “factually distinguishable” from Mr. Forvendel's case.

The court explained that Steptore involved a waiver based on the actions of the insurer during the course of a single proceeding. In “sharp contrast to those facts,” the court said, Mr. Forvendel was seeking to rely on the insurer's actions that occurred in connection with “a prior 2007 claim” to find that a waiver occurred in the context of his 2013 claim.

The court then ruled that any purported waiver by State Farm of its defenses with regard to Mr. Forvendel's 2007 claim could not constitute a waiver with respect to his 2013 claim. Accepting Mr. Forvendel's argument, the court concluded, “would result in the absurd conclusion that State Farm is forever precluded from raising the anti-stacking defense in any future claim filed by [Mr. Forvendel].”

The case is Forvendel v. State Farm Mutual Automobile Ins. Co., No. 2017-C-2074 (La. June 27, 2018).