September 20th, 2020
Franklin v. Regions Bank
Opinion Date: September 18, 2020
Judge: Edith Brown Clement
Areas of Law: Contracts
After plaintiffs contracted with Regions Bank for it to manage, as their agent, their mineral interests in a large tract of land, Regions signed a lease extension with a third party, intending to extend the lease for only a small part of the property. However, the lease was unlimited and applied to the entire tract of land. Region's unintentional mistake cost plaintiffs tens of millions of dollars. The Fifth Circuit reversed the district court's dismissal of plaintiffs' action for breach of contract against Regions, holding that Louisiana's ten year statute of limitations period for contract claims applies to plaintiffs' suit. In this case, plaintiffs alleged that Regions breached their contracts by acting negligently. The court stated that, under Louisiana law, they had the choice to sue Regions for this alleged breach in tort or in contract. Because plaintiffs chose contract, their claim is subject to the ten year statute of limitations. Accordingly, the court remanded for further proceedings.
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