How the New Civil Code Will Impact Legal Practices Across Louisiana.
Effective July 1, 2024, Louisiana extended the prescriptive period for delictual actions and damage to immovable property to two years, as established by Act No. 423 (HB 315). This act enacts Louisiana Civil Code articles 3493.11 and 3493.12, repealing the one-year statute that had been in place for nearly 200 years. Under the new law, individuals will have two years to file a lawsuit for injuries or property damage occurring after the effective date.
This modification will not only alter the landscape of tort litigation in Louisiana, but also impact how attorneys approach their cases and manage client relationships. Below, we explore the implications of these changes, focusing on immediate impacts for all attorneys, future predictions, and the challenges and opportunities that smaller law firms may face in navigating this new legal environment.
The New Law
The text of the Civil Code Article 3493.11, Delictual Actions, reads as follows:
Delictual actions are subject to a liberative prescription of two years. This prescription commences to run from the day injury or damage is sustained. It does not run against minors or interdicts in actions involving permanent disability and brought pursuant to the Louisiana Products Liability Act or state law governing product liability actions in effect at the time of the injury or damage.
The text of the Civil Code Article 3493.12, Damage to Immovable Property; Commencement and Accrual of Prescription, reads as follows:
When damage is caused to immovable property, the two-year prescription commences to run from the day the owner of the immovable acquired, or should have acquired, knowledge of the damage.
Immediate Impacts on Tort Litigation
Any change in legal procedure can be expected to impact the way attorneys approach cases and succeed in practice. In the immediate aftermath of the new Civil Code, here are a few changes you can expect to see in the practice of tort law:
1. Reduced Time Pressure
An extended timeframe to file and prepare tort suits benefits both clients and attorneys. Clients may feel less rushed, allowing them to document more evidence, consult medical professionals, and fully understand their injuries before seeking legal advice. Attorneys may have more time to analyze a broader range of evidence, obtain key witness statements, and document the full extent of their clients’ damages, including long-term impacts on quality of life and earning capacity. Additionally, they may have longer to seek expert opinions to validate claims, strengthening their overall strategy to present a more persuasive position during litigation, which can lead to better outcomes and a higher quality of legal service.
2. Higher Settlement Opportunities
Extending the statute of limitations may increase leverage in negotiations, allowing attorneys to pursue larger settlements from a more-informed position. With an additional year to prepare, attorneys can build more compelling cases, encouraging defendants to consider early settlements to avoid the risks and costs of litigation. Additionally, changes in the defendants’ financial situations or public reputation over time can further positively influence the dynamics of negotiations.
3. Larger Caseloads
Attorneys may see an increase in cases as more victims come forward during the extended filing period. This influx can create significant business opportunities, as more clients seek legal counsel and refer future clients. Additionally, attorneys may take on a broader range of tort cases, allowing them to develop expertise and enhance their reputation in new areas. More cases can translate to increased legal fees, enabling attorneys to strengthen their practices.
Long-Term Ramifications
This change in tort law is likely to yield effects that will not be immediately evident. In fact, we anticipate that the legal landscape will continue to evolve over the years following the law’s effective date. Below, we explore several changes that are expected to emerge in the field over time.
1. Litigation Trends
Over time, attorneys and clients may adjust their strategies based on the new timeline. Clients may feel encouraged by the additional year and tend to postpone filing their claims until closer to the deadline, leading to a surge in filings near the end of the two-year period. This could overwhelm courts and create bottlenecks in the judicial process while straining case management systems. This could also lead to an influx of stale evidence and forgotten details by key witnesses. This evolution in litigation trends will likely change how cases are processed, negotiated, and resolved, emphasizing the need for adaptability in navigating the new legal landscape.
2. Client Expectations & Relationships
Clients may develop new expectations regarding the timeline for achieving results due to the extended statute of limitations. This shift may change how individuals and attorneys approach litigation, fostering greater patience but potentially leading to frustrations due to delayed resolutions. Furthermore, the additional time may encourage longer relationships between clients and their attorneys, enhancing client loyalty and generating more word-of-mouth referrals.
3. Evaluation of Legal Resources
In the coming years, law firms may reassess their resource allocation for handling tort claims. Smaller firms, in particular, might find strong reasons to form long-term partnerships with larger firms to manage the expected increase in caseloads and resource demands. Collaborating with larger firms allows smaller practices to access additional expertise, share resources, and streamline operations, ultimately improving their ability to deliver quality legal representation in a more complex legal landscape.
Considerations for Smaller Firms
The extension of the statute of limitations for tort actions presents a mix of opportunities and challenges, especially for smaller firms. These firms should be especially mindful of how their practices may be impacted while navigating the evolving legal landscape. Our top three considerations for smaller firms are listed below.
1. Higher Litigation Costs
With a longer timeline for case resolution, the financing of cases (including costs related to expert witnesses, discovery, and litigation expenses) could strain smaller firms that rely on immediate cash flow. Larger firms typically have more resources and capital to weather extended litigation timelines, so partnering with such firms may become more beneficial as the industry adjusts to this new landscape.
2. Backlogged Caseloads
The extension could result in a sudden influx of cases that hinder attorneys’ ability to manage their practices efficiently. Smaller firms, in particular, may struggle to cope with the increased caseload due to limited resources, leading to overburdened staff, burnout, and a potential decline in the quality of legal representation. This influx of new cases could also overlap with those already filed, complicating case prioritization and management for independent attorneys and mid-sized law firms.
3. Intensified Market Competition
With an increased number of claims, competition among tort attorneys could intensify. Additionally, the need to invest more in marketing efforts to attract new business may rise, particularly for smaller firms that compete to target the same client audiences. This may make it exceedingly challenging for smaller practices to stand out in the crowded marketplace without outside support, further heightening the competitive pressure they face.
Louisiana’s extension of the statute of limitation for torts and damage to immovable property presents both challenges and opportunities for attorneys. While the longer window for filing lawsuits allows for more thorough preparation, it also necessitates a more strategic approach to case management, client relations, and resource allocation.
At Talbot, Carmouche & Marcello, we understand the evolving landscape of tort litigation and are here to support independent attorneys and small law firms through this transition. We offer case referrals and provide essential financial and personnel resources that can help you succeed in competitive environments. With over $3 billion in verdicts and settlements won for our clients, we want to support you and your cases as a trusted ally.