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United States Court of Appeals,
Fifth Circuit.
No. 913391.
TRIZEC PROPERTIES, INC., PlaintiffAppellant,
v.
UNITED STATES MINERAL PRODUCTS COMPANY, DefendantAppellee.
Oct. 8, 1992.
Appeal from the United States District Court for the Eastern District of Louisiana.
Before POLITZ, Chief Judge, SMITH, Circuit Judge, and FITZWATER,** District Judge.
POLITZ, Chief Judge:
roperties, Inc. appeals a summary judgment in favor of United States Mineral Products Company in an
action to reco ver asbestos abatement costs. Concluding that Trizec's claim is prescribed, i.e.,
time-barred, we affirm.
Background
In 1965 United States Mineral Products Company (USMPC), a New Jersey corporation with
its principal place of business in that state, sold asbestos-laden fireproofing material to a
subcontractor for use in the construct ion of a building in Atlanta, Georgia. Trizec, a Delaware
corporation with its principal place of business in Michigan, purchased the building in 1975, became
aware in the early 1980s that the building contained asbestos but did not begin asbestos abatement
until 1985. In January 1988 Trizec learned that USMPC manufactured the asbestos. Trizec filed the
instant complaint against USMPC in the federal district court for the Eastern District of Louisiana
in September 1989. Trizec candidly admits to having filed this action in Louisiana because of a 1985
Louisiana statute which purportedly provides a prescriptive period1 of five years from the date of
*District Judge of the Northern District of Texas, sitting by designation.
1In the civil law a prescriptive period is the analogue to a common law statute of limitations.
Any differences between the two legal concepts are not germane to this appeal.

discovery of the identity of the manufacturer.
USMPC answered Trizec's complaint asserting, inter alia, a limitations defense. USMPC
urged in a summary judgment motion that Louisiana's borrowing statute2 required that the district
court apply the general Georgia limitations statute.3 The district court granted summary judgment
on the basis of the Georgia limitations statute and dismissed Trizec's complaint as time-barred. Trizec
timely appealed.
Analysis
The standard of review for a summary judgment is well settled: we review the record de novo
to ascertain whether any genuine issue exists as to any material fact and, finding none, ascertain
whether the moving party is entitled to a judgment as a matter of law.4 Without weighing the
evidence, assessing its probative value, or resolving any factual disputes, we search the summary
judgment record for resolution-determinative factual disputes.5 Finding none, we may determine
whether the successful party is entitled to judgment as a matter of law. Because the parties do not
dispute the district court's findings of fact we accept same for purposes of this appeal. Our review
need only resolve whether USMPC is entitled to judgment as a matter of law.
Subject Matter Jurisdiction
Federal courts are courts of limited jurisdiction, having only the authority endowed by the
Constitution and that conferred by Co ngress. Because we may not proceed without requisite
jurisdiction, it is incumbent upon federal courts, trial and appellate, to examine constantly the basis
2La.Civ.Code art. 15 (1870) was amended and reenacted by 1991 La.Acts No. 923, § 1. The
1870 article is applicable to all actions filed prior to Jan. 1, 1992. 1991 La.Acts No. 923, § 4.
3Ga.Code Ann. § 9330. Neither party urged that the law of New Jersey, Michigan,
Delaware, or Louisiana might apply to the substantive issues.
4Fed.R.Civ.P. 56(c); Miles v. Amer. Tel. & Tel., 703 F.2d 193 (5th Cir.1983).
5KennettMurray Corp. v. Bone, 622 F.2d 887 (5th Cir.1980).

of jurisdiction, doing so on our own motion if necessary.6
In Trust Co. Bank v. United States Gypsum Co.,7 a case factually indistinguishable from the
case at bar, United States Gypsum challenged federal subject matter jurisdiction by invoking the local
action doctrine.8 Relying on circuit precedent we determined that the issue of subject matter
jurisdiction turned on whether the law of the forum state characterized the action as local or
transitory.9 The Trust Co. Bank court noted that in Holmes v. Barclay,10 the Louisiana Supreme
Court rejected the local action doctrine in a case of trespass to property in Illinois. Because the
disposition in Trust Co. Bank turned on Mississippi law, however, the reference to the Holmes
holding was mere dictum. In the case at bar, Louisiana law controls the issue; thus, Holmes
precludes a challenge to federal court subject matter jurisdiction on the grounds of the local action
doctrine.
Choice of Law
A federal district court applies the choice of law rules of the forum state.11 The Supreme
Court recently reaffirmed the principle that a state may apply its own statutes of limitations to foreign
6Save the Bay, Inc. v. The United States Army, 639 F.2d 1100 (5th Cir.1981).
7950 F.2d 1144 (5th Cir.1992).
8Livingston v. Jefferson, 15 F.Cas. 660 (C.C.D.Va.1811) (No. 8411) as modified by
Huntington v. Attrill, 146 U.S. 657, 13 S.Ct. 224, 36 L.Ed. 1123 (1892) and followed in this
circuit in Chateau Lafayette Apartments, Inc. v. Meadow Brook National Bank, 416 F.2d 301
(5th Cir.1969), and Hayes v. Gulf Oil Corp., 821 F.2d 285 (5th Cir.1987).
9The application of the law of the forum state to the determination of the issue of federal court
subject matter jurisdiction is contrary to the holding in Livingston. This anomaly has not gone
unnoticed in our cases. See Trust Co. Bank, 950 F.2d at 11491150. Nonetheless, we are bound
to prior panel opinions absent en banc reconsideration or a superseding contrary Supreme Court
case, neither of which has occurred on this issue. Trust Co. Bank, 950 F.2d at 1150.
104 La.Ann. 63 (1849).
11Erie R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938); Klaxon Co. v.
Stentor Electric Mfg. Co., 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941); Kozan v.
Comstock, 270 F.2d 839 (5th Cir.1959); Ardoyno v. Kyzar, 426 F.Supp. 78 (E.D.La.1976).

causes of action brought in its courts.12 Louisiana courts, and this court under Erie acting as a
Louisiana court, have not hesitated to exercise this power.13
Unlike most other American jurisdictions, Louisiana has always had codified choice of law
rules.14 Civil Code Article 15 (1870), paragraphs 6 and 7, provide the choice of law rule for statutes
of limitations.15 Trizec contends that paragraph 6 provides the correct choice of law rule and that the
rule mandates the application of the Louisiana prescriptive period. Article 15, ¶ 6 provides that:
The prescription provided by the laws of this state applies to an obligation arising under the
laws of another jurisdiction which is sought to be enforced in this state.
USMPC, on the other hand, contends that the district court correctly determined that the correct
choice of law rule is paragraph 7 which mandates that the Georgia statute of limitations be applied.
Article 15, ¶ 7 provides that:
When a contract or obligation has been entered into between persons who reside out of this
state, which is to be paid or performed out of this state, and such contract or obligation is
barred by prescription, or the statute of limitations, of the place where it is to be paid or
performed, it shall be considered and held to be barred by prescription in this state, upon the
debtor who is thus discharged coming into this state.
As in Kozan, we must first "determin[e] ... the proper Louisiana conflict of laws rule."16
12Sun Oil Co. v. Wortman, 486 U.S. 717, 108 S.Ct. 2117, 100 L.Ed.2d 743 (1988).
13Kozan; Wright v. Fireman's Fund Ins. Co., 522 F.2d 1376 (5th Cir.1975); Gierling v.
Garner, 284 So.2d 664 (La.App.1973).
14In 1991 Louisiana enacted a new and more comprehensive set of choice of law rules.
La.Civ.Code arts. 35153549 (1991). The new rules are applicable to actions filed after January
1, 1992. See 1991 La.Acts, No. 923, § 4.
15Kozan acknowledged an exception to the Louisiana choice of law rules of Article 15 in that
"[i]f a foreign statute of limitations not only bars the remedy but extinguishes the substantive right
as well, then the forum will apply the limitations period of the foreign jurisdiction." Kozan, 270
F.2d at 839. USMPC makes no claim that section 9330 extinguishes the substantive right; the
exception is inapplicable.
16Kozan, 270 F.2d at 839.

We agree with the district court's initial conclusion that Trizec's various negligence claims
represent obligations within the meaning of the Civil Code.17 Therefore either paragraph 6 or 7 might
be applicable. The district court then assumed sub silentio that Trizec and USMPC "entered into"
an obligation and shifted its analysis to paragraph 7 without explaining why paragraph 6 was no
longer under consideration. This was an analytical misstep.
A conventional obligation is "an agreement by two or more parties whereby obligations are
created, modified, or extinguished."18 Contracts are nominate or innominate.19 The nominate
contracts, found in Book III, Titles VIXX of the Civil Code, are: Matrimonial Regimes, Sale,
Exchange, Lease, Rents and Annuities, Partnership, Loan, Deposit and Sequestration, Aleatory
Contracts, Mandate, Suretyship, Transaction and Compromise, Respite, Arbitration, and Pledge. The
sine qua non of all conventional obligations, i.e. contracts, is the consensual nature of the
engagement.20
QuasiContracts, Offenses, and QuasiOffenses, acts which give rise to other than
conventional obligations, are found in Book III, Title V, La.Civ.Code art. 1914, comment (c). These
are non-consensual obligations which are implied by law or which arise by operation of law as a result
of an intentional or negligent act.21 Furthermore, the general rules governing contracts, including the
17La.Civ.Code arts. 1756 and 1757 (1984).
The parties and the district court implicitly assumed that the 1984 revision to the
Obligations articles of the Civil Code applies to acts that, in part, occurred prior to the
Jan. 1, 1985 effective date of the revision. With respect to the district court's reliance on
La.Civ.Code arts. 1956 and 1957 (1984), we agree with the Louisiana Second Circuit
which held that where the comments to a revised Code article indicate that the article
represents no change in the law, it may be applied retroactively. State v. Joint Com'n on
Accreditation of Hospitals, Inc., 470 So.2d 169 (La.App.1985).
18La.Civ.Code art. 1906.
19La.Civ.Code art. 1914.
20La.Civ.Code art. 1927.
21La.Civ.Code art. 2292.

rules of consent, are inapplicable to obligations arising from quasi-contracts, offenses, or
quasi-offenses.22
Paragraph 7 of Article 15 by its express terms applies only to contracts or obligations "entered
into"; these are consensual obligations. Perforce we must conclude that paragraph 7 is not applicable
to a non-consensual obligation arising out of a quasi-contract, offense, or quasi-offense. This
conclusion is reinforced by the fact that the parties have not cited, nor has our research revealed, any
case in which paragraph 7 of Article 15 has been applied by any court to a pure tort case.
Furthermore, the conclusion is consistent with the location of Civil Code article 2315, the
fountainhead of Louisiana tort law, in Book III, Title V, Chapter 2, outside of the codical provisions
for contracts. Thus, as an Erie court we conclude that paragraph 6 of Article 15 provides the correct
choice of law rule and that a Louisiana court would apply the applicable Louisiana prescriptive
statutes to the case at bar.23
Selection of the Appropriate Prescriptive Period
Among the possible Louisiana prescriptive periods from which we must select are: (1) the
general one-year prescriptive period applicable to torts;24 (2) the one-year prescriptive period
applicable to damage to immovable property;25 or, as Trizec insists, (3) the five-year "prescriptive"
period of R.S. 9:5644.26
22La.Civ.Code arts. 1914 and 1915.
23American Waste & Pollution Control Co. v. BrowningFerris, Inc., 949 F.2d 1384 (5th
Cir.1991).
24La.Civ.Code art. 3492.
25La.Civ.Code art. 3493.
26As an aside we note that in March 1989 the Georgia Supreme Court struck down a statute
remarkably similar to La.R.S. 9:5644, as being violative of the equal protection clause of the 1983
Georgia Constitution. Celotex Corp. v. St. Joseph Hospital, 259 Ga. 108, 376 S.E.2d 880
(1989). O.C.G.A. § 9330.1, effective April 14, 1988, would have revived otherwise
time-barred asbestos abatement actions so as to permit filing of suit no later than July 1, 1990.

We first conclude that Trizec's contention that R.S. 9:5644(B) creates a prescriptive period
is not persuasive. We find this to be nothing more than a statutory suspension of prescription.27
Section B provides that:
Notwithstanding any other provision of law to the contrary, any time limitation or
prescriptive period which may be applicable to any action to recover for asbestos abatement
work shall not apply or expire until five years after the date on which the party seeking to
recover has completed the abatement work or discovered the identity of the manufacturer of
the materials which require abatement, whichever is later. [Emphasis ours.]
This section provides no express or implied prescriptive period. It merely suspends the running of
"any time limitation or prescriptive period which may be applicable" until five years after the
happening of the later of two events: (1) completion of the asbestos abatement work, or (2)
discovery of the identity of the manufacturer of the materials which require abatement. This section
contains no language of revival of an expired (i.e. prescribed) cause of action. As a suspensive
statute, R.S. 9:5644(B) cannot be applied retroactively to revive an action that prescribed prior to
its effective date.28
Prior to the effective date of R.S. 9:5644,29 Article 3492 or 3493 controlled the issue of
27La.Civ.Code arts. 3467 and 3472.
28Louisiana Courts of Appeal are divided over the question whether a suspensive statute may
be applied retroactively so as to revive a cause of action already prescribed. See White v. West
Carroll Hospital, Inc., 598 So.2d 1134 (La.App. 2d Cir.), writ granted, 600 So.2d 672 (La. July
1, 1992) (amendments to suspensive statutes La.R.S. 40:1299.41(G) and 40:1299.47 do not
retroactively revive prescribed action); but see Graham v. St. Charles General Hospital, 590
So.2d 818 (La.App. 4th Cir.1991) (La.R.S. 40:1299.41(G) and 40:1299.47 applied retroactively
to prescribed action). We observe that in the few instances in which the Louisiana Legislature has
intended this two-fold effect of retroactivity and revival, it has expressly stated its intention.
Accord La.R.S. 9:5811, 9:5630, and 9:5625. Compare R.S. 9:5627. There is no express
statement of retroactivity in R.S. 9:5644. We are persuaded the White court has the better
resolution and opt to follow it.
29La.R.S. 9:5644 became effective on Sept. 6, 1985. La. Const. Art. 3, § 19.

prescription.30 Louisiana, unlike Georgia, applies the discovery rule to prescriptive statutes.31 Under
Jordan and its progeny, the prescriptive period on a cause of action begins to run when the person
in whose favor a cause of action exists knows or should have known of the existence of his cause of
action. Undisputed actual notice is generally sufficient to place a reasonable person on notice of the
existence of a cause of action against a specific person and to start the running of the prescriptive
period.
In order for the prescriptive period of Articles 3492 or 3493 to be tolled by R.S. 9:5644(B),
Trizec had to demonstrate that the one-year period provided by those articles did not accrue before
R.S. 9:5644 became effective on Sept. 6, 1985. The district court made a factual finding that Trizec
had actual knowledge of the existence of the asbestos in the early 1980s as a result of several studies
conducted to determine the presence and effect of asbestos in the building. Under Louisiana law,
when a claim is prescribed on its face the plaintiff bears the burden of proving interruption or
suspension of prescription.32 Trizec's summary judgment proof does not acquit this burden. Trizec
has failed to offer the requisite proof t hat it acquired the relevant knowledge on or after Sept. 6,
1984, within one year prior t o the effective date of La.R.S. 9:5644. Trizec, therefore, has not
established the basis for a suspension of prescription and its cause of action had already expired under
Article 3492 or 3493 when R.S. 9:5644 became law.
As a consequence, the viability of Trizec's cause of action hinges upon whether it falls within
the purview of the "revival" provision of R.S. 9:5644(C), which provides:
Any person who has a cause of action to recover for asbestos abatement work under
30The prescription articles were amended and reenacted in 1983 without any substantive
change in the law. See 1983 La.Acts, No. 173, § 1 and comments (a) to both Articles 3492 and
3493 (1983). See n. 8, supra.
31Jordan v. Employee Transfer Corp., 509 So.2d 420 (La.1987).
32Lima v. Schmidt, 595 So.2d 624 (La.1992).

the provisions of this Section but whose action is barred by the prescriptive period provided
in R.S. 9:5644 shall have one year from the effective date of this Act within which to bring
an action or be forever barred. [Emphasis ours.]
This subsection is far from a model of clarity. The language "barred by the prescriptive period
provided in R.S. 9:5644" presents no small difficulty of interpretation. If we conclude that the
"prescriptive period provided in R.S. 9:5644" is the five-year period of section B, then we necessarily
trip upon an absurdity--the five-year period could not start until Sept. 6, 1985, the effective date of
R.S. 9:5644; thus no action barred by that five-year period could be brought within one year of the
effective date of the statute. Such a literal interpretation reduces section C to meaningless surplusage.
We may not accept that course. "When a statute is susceptible of two interpretations, a court must
choose the one which affords a reasonable and practical effect to the entire act over one which
renders part of it meaningless or useless."33
We find the path to the solution to this apparent conundrum clearly blazed by the Civil Code
articles on interpretation of laws.34 Article 9 instructs that "[w]hen a law is clear and unambiguous
and its application does not lead to absurd consequences, the law shall be applied as written...."35
R.S. 9:5644 fails the test of Article 9. The absurd consequences of a literal interpretation may be
avoided by an in pari materia reading of laws on the same subject matter.36 Having determined that
the "prescriptive period provided in R.S. 9:5644" refers to Article 3492 or 3493, we achieve a
reasonable result which gives meaning to the suspension and revival aspects of R.S. 9:5644 and the
relevant prescriptive periods.
Concluding that Trizec's cause of action was prescribed by applicable Code articles at the time
of the effective date of La.R.S. 9:5644, Trizec had, at the very most, until Sept. 6, 1986 to exercise
33Reed v. Washington Parish Police Jury, 518 So.2d 1044 (La.1988) (citations omitted).
34La.Civ.Code arts. 913 (1987).
35Ramirez v. Fair Grounds Corp., 575 So.2d 811 (La.1991).
36La.Civ.Code art. 13.

the revival grant of R.S. 9:5644(C). Trizec filed suit more t han four years later. We therefore
conclude that Trizec's complaint was prescribed when filed and that the revival provision of La.R.S.
9:5644(C), assuming per arguendo its applicability, provides no surcease.37
The judgment of the district court is AFFIRMED.

37We note but do not reach the question of whether R.S. 9:5644(C) is peremptive.
La.Civ.Code art. 3458 (1982).