Edwards v. Daugherty

Last Friday, the Supreme Court released an interesting opinion in Edwards v. Daugherty, No. 03-C-2103 (La. Oct. 1, 2004). The opinion holds:

1. Louisiana law allows a liability insurer to deduct from policy limits the cost of defending the insured, if the policy so provides.

2. But the policy in question allowed the insurer to deduct only the cost of defending the insured, not the cost the insurer incurred in defending itself.

3. Louisiana law prohibits reduction in policy limits due to payment of legal interest. "Any policy provision which attempts to limit an insurer's liability for legal interest on the policy limits contravenes public policy." Slip op. at 24.

4. A plaintiff who recovers future damages in a tort case is entitled to an award of legal interest from the date of judicial demand on those future damages.

Posted by RPW at October 4, 2004 06:56 PM