SLS 20RS-497 ORIGINAL
2020 Regular Session
SENATE BILL NO. 377
BY SENATOR LAMBERT (On Recommendation of the Louisiana State Law Institute)
PRESCRIPTION. Provides relative to prescription. (8/1/20)
1 AN ACT
2 To amend and reenact Civil Code Articles 2041, 2534, and 3463, and to repeal Civil Code
3 Article 3502, relative to prescription; to provide for prescription of the revocatory
4 action; to provide for prescription of actions for redhibition and breach of the
5 warranty of fitness for use; to provide for the interruption of prescription; to provide
6 with respect to prescription of actions for recognition of inheritance rights; and to
7 provide for related matters.
8 Be it enacted by the Legislature of Louisiana:
9 Section 1. Civil Code Articles 2041, 2534, and 3463 are hereby amended and
10 reenacted to read as follows:
11 Art. 2041. Action must be brought within one year
12 The action of the obligee must be brought within one year from the time he
13 learned or should have learned of the act, or the result of the failure to act, of the
14 obligor that the obligee seeks to annul, but never after three years from the date of
15 that act or result.
16 The three year period provided in this Article shall not apply in cases of
17 fraud.
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SLS 20RS-497 ORIGINAL
1 Revision Comments - 2020
2 This revision changes the law by deleting the second paragraph of prior
3 Article 2041, which was added in 2013 and which created an exception to the
4 three-year period in the first paragraph in cases of fraud. The 2013 amendment had
5 the potential to create instability in title to immovables, as any instance in which a
6 transfer of property occurred "fraudulently" and in violation of the law on revocatory
7 actions potentially allowed the original transferor to recover the property within "one
8 year from the time he learned or should have learned of the act, or the result of the
9 failure to act." The three-year period provided in this Article creates an important
10 protection for third parties and an obvious effort "to protect the security of
11 transactions." In addition, the 2013 amendment risked re-injecting the concept of
12 fraud into the revocatory action - a concept that was eliminated in the general
13 revision to the law of obligations in 1984 because of the confusion and uncertainty
14 that the concept of fraud caused. Accordingly, the 1984 revision eliminated the
15 concept of fraud from the revocatory action and in its place substituted the concept
16 of insolvency. This revision restores Article 2041 to its original text as revised in
17 1984.
18 * * *
19 Art. 2534. Prescription
20 A.(1) The action for redhibition against a seller who did not know of the
21 existence of a defect in the thing sold prescribes and the action asserting that a
22 thing is not fit for its ordinary or intended use prescribes in four years two years
23 from the day of delivery of the such thing was made to the buyer or one year from
24 the day the defect or unfitness was discovered by the buyer, whichever occurs first.
25 (2) However, when the defect is of residential or commercial immovable
26 property, an action for redhibition against a seller who did not know of the existence
27 of the defect prescribes in one year from the day delivery of the property was made
28 to the buyer.
29 B. The action for redhibition against a seller who knew, or is presumed to
30 have known, of the existence of a defect in the thing sold prescribes in one year from
31 the day the defect was discovered by the buyer or ten years from the perfection of
32 the contract of sale, whichever occurs first.
33 C. In any case prescription on an action for redhibition is interrupted when
34 the seller accepts the thing for repairs and commences anew from the day he tenders
35 it back to the buyer or notifies the buyer of his refusal or inability to make the
36 required repairs.
37 Revision Comments - 2020
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SLS 20RS-497 ORIGINAL
1 (a) This revision changes the law to create uniform prescriptive periods for
2 movables and immovables. It maintains the distinction between sellers who knew
3 or should have known of the defect in the thing sold as opposed to those sellers who
4 did not. Prior law created separate prescriptive periods for the sale of movables and
5 for the sale of "residential or commercial immovable[s]," and in many instances it
6 provided a longer prescriptive period for the sale of movables than for immovables.
7 Moreover, the creation of a special prescriptive period for redhibitory defects in
8 "residential or commercial immovable property" created uncertainty as to
9 prescriptive period for other immovable property. See, e.g., MGD Partners, LLC v.
10 5-Z Investments, Inc., 145 So. 3d 1053 (La. App. 1 Cir. 2014) (holding that a claim
11 for redhibitory defects in undeveloped immovable property is subject to "the
12 four-year prescriptive period and/or discovery rule of La. Civ. Code art. 2534(A)(1)
13 … and not the one-year prescriptive period found in La. Civ. Code art. 2534(A)(2),
14 which, by its terms, pertains to residential or commercial immovable property.")
15 This revision makes all good faith sellers subject to a uniform prescriptive period of
16 two years from the day of delivery of the thing to the buyer or one year from the day
17 the defect was discovered by the buyer, whichever occurs first.
18
19 (b) This revision also unifies the relevant prescriptive periods for actions in
20 redhibition and those for breach of the warranty of fitness for use. Prior law
21 provided no specific prescriptive period for breach of the warranty of fitness for use.
22 Consequently, the ten-year prescription in Article 3499 prevailed. Because the law
23 on redhibition and fitness for use is largely overlapping, the dichotomy between the
24 prescriptive periods could create stark differences in outcome. See, e.g., Cunard
25 Line Ltd. Co. v. Datrex, Inc., 926 So. 2d 109 (La. App. 3 Cir. 2006). This revision
26 unifies the law on prescription for purposes of redhibition and fitness for use.
27 Because the law of sales does not distinguish between good faith and bad faith sellers
28 for purposes of the warranty of fitness for use, this revision does not purport to create
29 different prescriptive periods on that basis.
30
31 (c) This revision also provides clarity regarding the prescriptive period for
32 bad faith sellers. Comment (b) to the 1993 revision suggested that in all cases, "an
33 action in redhibition prescribes ten years from the time of perfection of the contract
34 regardless of whether the seller was in good or bad faith. See C.C. Art. 3499."
35 Article 3499, by its terms, however, applies only to personal actions in which a
36 prescriptive period is not "otherwise provided by legislation," whereas this Article
37 comprehensively provides for different prescriptive periods depending both upon the
38 characterization of the property and the good faith or bad faith of the seller.
39 Moreover, courts' rulings were not consistent in holding whether Article 3499 was
40 applicable in the context of redhibition. See, e.g. Tiger Bend, L.L.C. v.
41 Temple-Inland, Inc., 56 F. Supp. 2d 686 (M.D. La. 1999); Mouton v. Generac Power
42 Systems, Inc., 152 So. 3d 985 (La. App. 3d Cir. 2014); Grenier v. Medical
43 Engineering Corp., 243 F. 3d 200 (5th Cir. 2001). This revision adopts a legislative
44 solution to this issue and provides that liberative prescription for an action against
45 a bad faith seller accrues in one year from when the defect was discovered by the
46 buyer or ten years from the perfection of the contract of sale, whichever occurs first.
47 For the time of perfection for a contract of sale, see Article 2439.
48
49 * * *
50 Art. 3463. Duration of interruption; abandonment or discontinuance of suit
51 An interruption of prescription resulting from the filing of a suit in a
52 competent court and in the proper venue or from service of process within the
53 prescriptive period continues as long as the suit is pending.
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SLS 20RS-497 ORIGINAL
1 Interruption is considered never to have occurred if the plaintiff abandons the
2 suit, voluntarily dismisses the action suit at any time either before the defendant has
3 made any appearance of record or thereafter, or fails to prosecute the suit at the trial.
4 A settlement and subsequent The dismissal of a defendant suit pursuant to a
5 transaction or compromise shall not qualify as does not constitute a voluntary
6 dismissal pursuant to this Article.
7 Revision Comments - 2020
8 The 2020 revision makes semantic changes and is not intended to change the law.
9 Section 2. Civil Code Art. 3502 is hereby repealed.
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Margaret M. Corley.
DIGEST
SB 377 Original 2020 Regular Session Lambert
Present law (C.C. Art. 2041) provides that the revocatory action must be brought within one
year of discovery of the obligor's act or failure to act but never after three years from the act
or failure to act itself, except in cases of fraud.
Proposed law removes the exception to the three-year period provided by present law in
cases of fraud.
Present law (C.C. Art. 2534(A)(1)) provides that actions for redhibition against good faith
sellers of movables and immovables other than residential or commercial immovables
prescribe four years from delivery or one year from discovery, whichever occurs first.
Present law (C.C. Art. 2534(A)(2)) provides that actions for redhibition against good faith
sellers of commercial and residential immovables prescribe one year from delivery.
Proposed law (C.C. Art. 2534(A)) changes the prescriptive periods under present law by
providing that actions for redhibition against good faith sellers of movables and immovables
prescribe two years from delivery or one year from discovery, whichever occurs first.
Present law (C.C. Art. 3499) provides that unless otherwise provided by legislation, personal
actions prescribe in ten years.
Proposed law (C.C. Art. 2534(A)) creates an exception to present law by providing that
actions for breach of the warranty of fitness for use prescribe two years from delivery or one
year from discovery, whichever occurs first.
Present law (C.C. Art. 2534(B)) provides that actions for redhibition against bad faith sellers
of movables and immovables prescribe one year from discovery.
Proposed law retains present law but provides an outside time limitation of ten years from
the perfection of the contract of sale, whichever occurs first.
Present law (C.C. Art. 2534(C)) provides that prescription is interrupted when the seller
accepts the thing for repairs and begins running again when the thing is returned to the buyer
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SLS 20RS-497 ORIGINAL
or when the buyer is notified of the seller's inability or refusal to make repairs.
Proposed law retains present law but clarifies that this provision applies only to actions for
redhibition.
Present law (C.C. Art. 3463) provides that a settlement and subsequent dismissal of a
defendant pursuant to a transaction or compromise does not qualify as a voluntary dismissal
for purposes of determining whether prescription has been interrupted.
Proposed law retains present law but makes nonsubstantive changes to employ terminology
that is consistent with language used throughout the Civil Code.
Present law (C.C. Art. 3502) provides that an action for the recognition of a right of
inheritance is subject to a liberative prescription of thirty years.
Proposed law repeals present law.
Effective August 1, 2020.
(Amends C.C. Arts. 2041, 2534, and 3463; repeals C.C. Art. 3502)
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