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NOT DESIGNATED FOR PUBLICATION
ABC BUILDING                                                                *                    NO. 2011-CA-0747
CONTRACTORS, INC.
                                                                            *
VERSUS                                                                                           COURT OF APPEAL
*
WESTBANK PROFESSIONAL                                                       FOURTH CIRCUIT
BUILDING PARTNERSHIP,                                                       *
ET AL.                                                                      STATE OF LOUISIANA
*
APPEAL FROM
CIVIL DISTRICT COURT, ORLEANS PARISH
NO. 2006-4565, DIVISION “D-16”
Honorable Lloyd J. Medley, Judge
Judge Dennis R. Bagneris, Sr.
(Court composed of Judge Charles R. Jones, Judge Dennis R. Bagneris, Sr.,
Judge Roland L. Belsome)
BELSOME, J. DISSENTS WITH REASONS.
Richard B. Ehret
Shaundra M. Westerhoff
BOYKIN EHRET & UTLEY
400 Poydras Street
Suite 1540
New Orleans, LA 70130
COUNSEL FOR PLAINTIFF/APPELLANT, ABC BUILDING
CONTRACTORS, INC.
Mary Ann Bossetta
DORSEY AND BOSSETTA
305 Marina Boulevard
Mandeville, LA 70471
COUNSEL FOR WESTBANK PROFESSIONAL BUILDING
PARTNERSHIP AND LAKEWAY INVESTMENTS, LLC.
Phillip A. Wittmann
Samantha P. Griffin                                                         NOVEMBER 23, 2011
Agnieszka A. McPeak
STONE PIGMAN WALTHER WITTMANN L.L.C.
546 Carondelet Street
New Orleans, LA 70130--3588
COUNSEL FOR LINDSTROM CLEANING AND CONSTRUCTION,
INC.
AFFIRMED




Plaintiff/appellant, American Building Contractors, Inc., and third-party
defendant/appellant, Lindstrom Cleaning & Construction, Inc., appeal a judgment
of the trial court, which (1) granted defendants and plaintiffs in reconvention‟s
motions for involuntary dismissal and dismissed with prejudice all claims of ABC
Building Contractors and Lindstrom Cleaning and Construction, and (2) rendered
judgment in favor of third party plaintiff, plaintiff in reconvention and intervenor,
Lakeway Investments, LLC in the amount of $678,360.37.  For the following
reasons, we hereby affirm the judgment of the trial court.
FACTS
On May 25, 2006, American Building Contractors, Inc. (“ABC”) filed suit
against defendants Westbank Professional Building Partnership (“Westbank”), Dr.
Janos Voros, Dr. Jules Deutsch and Dr. Jerry Smith claiming that the defendants
are indebted to ABC for $1,019,799.73, plus interest, lien costs, courts costs and
attorneys‟ fees as a result of ABC supplying labor and services to Westbank.
Specifically, ABC alleges that on October 9, 2005, a representative of Westbank
signed a contract with it for services and goods involving demolition and
remediation of damage caused by Hurricane Katrina.  On August 31, 2006,
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Defendants filed an answer, a reconventional demand against ABC, and a third
party demand against Lindstrom Cleaning & Construction (“Lindstrom”), a
subcontractor of ABC.  Intervenor, Lakeway Investments (“Lakeway”) intervened
with defendants and also reconvened against ABC and made demand upon
Lindstrom.  In the answer, the defendants allege that ABC and Lindstrom violated
Louisiana law by not being licensed in the state of Louisiana to perform the scope
of work.  Further, defendants allege that ABC and Lindstrom were negligent in the
performance of their work.  On October 17, 2006, ABC and Lindstrom filed an
answer to plaintiffs in reconvention and defendant in intervention simply denying
the allegations and did not challenge the capacity of Lakeway, as the proper party,
to file the reconvention and third party demand.
After a five day trial, the trial court granted an involuntary dismissal, which
dismissed with prejudice all claims of ABC and Lindstrom‟s and found in favor of
Lakeway in the amount of $678,360.37.  ABC and Lindstrom now appeal this final
judgment.
On appeal, ABC assigns the following assignments of error: (1) the trial
court erred in finding that Lakeway owned the Westbank building; (2) the trial
court erred in finding that Lakeway has standing in this case; (3) the trial court
erred in not admitting into evidence the ABC contract; (4) the trial court erred in
not finding Westbank breached the ABC contract and owes ABC $1,075,000.00
minus the interim payments made; (5) the trial court erred in finding that ABC and
Lindstrom were not properly licensed to do the work at the Westbank thereby
voiding any contract for that work; (6) the trial court erred in finding that the
Louisiana emergency reciprocity statutes do not apply; (7) the trial court erred in
finding there was no proof of Minnesota licenses for ABC and Lindstrom; (8) the
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trial court erred in finding that the work performed by ABC and Lindstrom
required a mold remediation license; (9) the trial court erred in finding that ABC
and Lindstrom were not entitled to recover job costs; (10) the trial court erred in
finding that the job costs incurred by ABC and Lindstrom were not proven; (11)
the trial court erred in not considering Mike Dewey's proffered testimony or a
negative presumption for failure to call him as an expert witness; (12) the trial
court erred in refusing any rebuttal evidence from ABC and Lindstrom after
Lakeway rested its case on the Reconventional Demand; (13) the trial court erred
in finding that Lakeway had a third party and reconventional demand seeking
reimbursement in full of $678,360.37; (14) the trial court erred in awarding
$678,360.37 to Lakeway on its claim for negligence; (15) the trial court erred in
allowing Daniel Plunkett to testify as an expert; and (16) the trial court erred in
finding Daniel Plunkett's testimony satisfied Lakeway‟s burden of proof.
Appellant Lindstrom assigns the following assignments of error:   (1) the trial
court erred in refusing to allow it, a third-party defendant, to present any evidence
in defense of the third-party claims asserted by Westbank and Lakeway; (2) the
trial court erred in awarding Lakeway a judgment against Lindstrom in the amount
$678,370.37 for the return of moneys paid by Westbank and Jo Ellen Investments,
LLC; (3) the trial court erred in refusing to admit the contract between ABC and
Westbank into evidence based on purported authenticity issues where Westbank
asserted a breach of contract claim based on the same contract and made numerous
judicial confessions as to the authenticity of that contract; (4) the trial court erred
in failing to find that ABC, a Minnesota licensed contractor, was entitled to
contract for work in Louisiana and in refusing to enforce the terms of the contract
despite the undisputed evidence that ABC and Lindstrom were licensed Minnesota
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contractors; (5) the trial court erred in not finding a contract existed among the
parties even in the absence of a written agreement; and (6) the trial court erred in
not awarding ABC the costs it incurred for labor and material in remediating and
removing water-logged material from the defendants' property.
STANDARD OR REVIEW
In Louisiana, appellate courts review both law and facts.  La. Const. Art. V,
Sec. 10(B).  The standard of review for a factual finding is the manifestly
erroneous or clearly wrong standard.  To reverse a fact finder‟s determination
under this standard of review, an appellate court must undertake a two-part inquiry:
(1) the court must find from the record that a reasonable factual basis does not exist
for the finding of the trier of fact; and (2) the court must further determine the
record establishes the finding is clearly wrong.  Stobart v. State, through Dept. of
Transp. and Development, 617 So.2d 880, 882 (La.1993).  The issue to be resolved
by the reviewing court is not whether the trier of fact was right or wrong, but
whether the fact finder‟s conclusion was a reasonable one.  Stobart, 617 So.2d at
882.  If the factual findings are reasonable in light of the record reviewed in its
entirety, a reviewing court may not reverse, even though convinced that had it been
sitting as the trier of fact, it would have weighed the evidence differently.  Stobart,
617 So.2d at 882-883.  Accordingly, where there are two permissible views of the
evidence, the fact finder‟s choice between them cannot be manifestly erroneous.
Stobart, 617 So.2d at 883.  Further, when a fact finder‟s determination is based on
its decision to credit the testimony of one of two or more witnesses, that finding
can virtually never be manifestly erroneous or clearly wrong.  Rosell v. ESCO, 549
So.2d 840, 844-845 (La.1989).  The credibility determinations of the trier of fact
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are subject to the strictest deference under the manifest error-clearly wrong
standard.  Theriot v. Lasseigne, 93-2661, p.9 (La.7/5/94), 640 So.2d 1305, 1313.
DISCUSSION
The first issue to address is whether the trial court erred in its finding that
Lakeway owned Westbank.  According to the public records, the Westbank
building sits on two lots, 20B1 and 20B2.  At the time the Westbank building was
built, Tenet Healthsystem Hospitals, Inc. (“Tenet”) leased the two lots to
Westbank; however, unless the leases were renewed by September 2002, the leases
would terminate on September 30, 2004, causing the landowner (Tenet) to become
the owner of the improvements.  The leases were not renewed in 2002, divesting
Westbank of its ownership interest in the building.  Thereafter, on March 17, 2003,
an Act of Sale occurred between Lakeway and Tenet whereby Tenet sold the two
lots, along with the building to Lakeway.  Although Lakeway sold certain parcels it
had acquired to independent third parties, i.e. Jo Ellen Investments, LLC, it
excluded the buildings and improvements, which would include the Westbank
building.  In 2006, in order to place the building and land together for potential sale
of the site, Jo Ellen Investments, LLC via Quitclaim, conveyed all of its right, title
and interest in the parcels back to Lakeway on February 17, 2006.  Further, in
order to further clarify the public record, Westbank executed a Quitclaim of any
interests it may have had in the West Bank Building to Lakeway on April 20, 2006.
From reviewing the public records admitted into evidence, especially the 2003 Act
of Sale between Lakeway and Tenet, we agree with the trial court‟s finding that
Lakeway was the owner of the Westbank building and is the proper party to
intervene and to file a third party demand and reconvention against Plaintiffs.
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We now consider whether the trial court erred in its finding that (1) a
contract did not exist between Westbank and ABC, (2) Plaintiffs did not have the
capacity to enter into a contract because they were unlicensed in Louisiana, (3)
Plaintiffs are not entitled to recover in quantum meruit, and (4) Lakeway should be
reimbursed the $678,360.37 for the work that was done at the Westbank building.
After reviewing the record and finding no clear error of fact or law, we adopt the
trial judge‟s well written reasons for judgment on these issues, which follow, as
our own:
Plaintiffs were Minnesota contractors who after Katrina
were hired to dry out/remediate the Westbank
Building that was heavily damaged in Katrina.
Westbank and Lakeway argued that Plaintiffs and
their subcontractors had no capacity to have entered into
a contract due to them having no licenses in place as
required by R.S. 37:2160, which makes it „unlawful for
any person to engage or continue in this state in the
business of contracting, or to act as a contractor unless he
holds an active license as a contractor under the
provisions of the Louisiana State Licensing Laws.‟  To
support this position, undisputed testimony was heard
from the Louisiana State Licensing Board for Contractors
(LSLBC) Compliance Director, Mr. Brent Templet, and
the then Executive Director of the LSLBC during
Katrina, Mr. Charles Marceaux, who clearly testified that
the requirements of the Louisiana Licensing laws
remained valid statutory requirements and were not
suspended. Only the aggressive enforcement of the laws
was suspended from September 1, 2005 through
December 1, 2005 as there was no executive order signed
by the Governor suspending Louisiana's contractor
licensing laws. This same threshold issue was decided in
three separate cases requiring licensure involving the
same contractor referred to as the Tradewinds cases.
In Tradewinds Environmental Restoration, Inc. vs.
Frank Stewart Jr., et al, No. 06-3299 2008 U.S. Dist.
LEXIS 6104 (E.D. La. Jan. 24, 2008), Judge Ivan
Lemelle granted summary judgment on the breach of
contract claim by the unlicensed contractor, finding the
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contracts null and void for lack of licensure. Judge
Lemelle found the licensing laws remained valid
statutory requirements despite suspension by the LSLBC
of enforcement. Therefore, the Court limited plaintiff's
claim to the actual costs of materials, services and labor,
and there could be no recovery for profit and overhead.
In so ruling, Judge Lemelle followed his colleague
from the Eastern District of Louisiana. In Tradewinds
Environmental Restoration, Inc. v. St. Tammany Park.
L.L.C., No. 06-593 2007 WL I191896 (E.D. La. April 20,
2007), Judge Carl Barbier granted the defendants' motion
for summary judgment on the basis that the unlicensed
plaintiff s contracts were void ab initio, rejecting the
plaintiff's policy argument (based on the Marceaux
affidavit) that because of the unprecedented devastation
from Katrina and the suspension of aggressive
enforcement by the LSLBC, the Court should ignore the
legislative requirements of licensure.
The matter was upheld on appeal in Tradewinds
Environmental Restoration, Inc, Plaintiff - Appellant v.
ST. Tammany Park, LLC, Defendant - Appellee, Colony
Insurance Company, Third Partv Defendant-Appellee,
No. 08-30729, United States Court of Appeals for the
Fifth Circuit, 578 F.3d 255; (2009 U.S. App).
Just as the plaintiffs in this case argued,
Tradewinds contended on appeal that the decision of the
LSLBC to loosen its enforcement of the licensing statutes
in the immediate aftermath of Hurricanes Katrina and
Rita protected its agreement from the general rule of
absolute nullity for failure of licensure. Tradewinds (as
did Plaintiffs in this case) relied upon an affidavit by
Charles E. Marceaux (and also live testimony), the
Executive Director of the Licensing Board, that states
that, for several months following the Hurricanes, the
LSLBC decided to „delay active and aggressive
enforcement of licensure laws pertaining to demolition
and debris removal and stay aggressive enforcement of
other licensure laws.‟ According to Tradewinds, the
district court's holding of absolute nullity imposes on
Tradewinds „the harshest enforcement possible‟ of
Louisiana licensing requirements, in contravention of the
Licensing Board's decision. Tradewinds, 578 F.3d at 262.
Tradewinds acknowledged that the Licensing
Board's discretion in conducting licensing enforcement
does not give it authority to suspend the licensing
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requirements.  Indeed, in times of emergency or disaster,
Louisiana law recognizes that only the
Governor has the power to suspend the provisions of any
regulatory statute prescribing the procedures for conduct
of state business, or the orders, rules, or regulations of
any state agency, if strict compliance with the provisions
of any statute, order, rule, or regulation would in any way
prevent, hinder, or delay necessary action in coping with
the emergency. LA. REV. STAT. § 29:724.
Both in this matter and Tradewinds, it is
undisputed that no executive order suspending Louisiana
licensing laws was executed in the aftermath of the
hurricanes.  Tradewinds, 578 F 3d at 263. Accordingly,
The Fifth Circuit upheld the district court ruling that the
Licensing Board's decision to loosen its enforcement of
licensing requirements in the aftermath of the hurricanes
did not suspend the requirement that contractors
performing contracting services in Louisiana be licensed.
Id.
The Court is of the opinion that these cases are the
controlling legal precedent in this matter. Therefore,
based on the trial evidence in the form of the
uncontroverted testimony from both Mr. Templet and
Mr. Marceuax [sic], as well as a lack of the production of
any alleged licenses of plaintiffs and their subcontractors,
it is an undisputed fact neither plaintiffs nor their
subcontractors were validly licensed in
Louisiana at the time they bid on the job at the Westbank
Building or when they attempted to enter into the alleged
contract.
The evidence was further clear that Lindstrom who
worked on this job remained unlicensed in Louisiana
until January 16, 2006, a month and a half past any grace
period they rely upon and well after the job was
completed. It is also undisputed that neither plaintiffs nor
any of their subcontractors had a mold remediation
license, a statutory requirement for the work they
performed in accordance with the independent testimony
of Mr. Templet, the LSLBC Compliance Director. It is
also quite clear that all of the other three sub-contractors
who performed work at the Westbank building were
completely unlicensed in the State of Louisiana.
Therefore, it is undisputed that during the entire time of
the job in question, there were no licensed Louisiana
contractors performing the work at the Westbank
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building nor was there any proof of the required licensure
provided by plaintiffs.
Further, Plaintiffs seek to enforce a contract and its
terms that are not in evidence. Plaintiffs admit they did
not sign the contract in question nor did they produce a
signed original that could be authenticated. They offered
no testimony or competent evidence to prove the one and
only signature on the contract. There is simply no
contract to enforce.
Plaintiffs have also argued that reciprocity applies
in this case. Mr. Brent Templet, the LSLBC Compliance
Director for the State of Louisiana, testified that
Louisiana does not have reciprocity with Minnesota, the
home state of plaintiff contractors, and that neither
plaintiff nor any of their subcontractors applied for a
waiver of reciprocity as would be required by Louisiana
law. The effect of reciprocity is that it waives the
necessity of the written exam only; however, all other
statutory requirements to obtain a license apply.
Plaintiffs also relied on the doctrine of emergency
reciprocity applied by Judge Magee in denying a
summary judgment to plaintiff seeking to void the
contract for failing to have a license in place at the time
of the contract. Happy Closing, LLC et
al. v. Chestnut Properties, et al. Case No. 2006-2549.
This is a district court decision that is not controlling
precedent.  It is also factually dissimilar to the case at
bar.
In Happv Closing, the defendants were properly
licensed in their home state for the same specialty
services they were providing to plaintiff's property in
Louisiana.  However in this case, plaintiffs, nor any of its
subcontractors, offered any proof of licensure in
Minnesota by providing license numbers, copies of
licenses, affidavits, certificates or some form of
competent evidence of licensure.  Also in this case, the
evidence and testimony from the LSLBC Compliance
Director was that a mold remediation license was needed
by the plaintiffs to perform the scope of work at the
Westbank Building.  Neither Plaintiffs nor any of its
subcontractors had the special class of a mold
remediation license in Louisiana or in Minnesota.
Further, emergency reciprocity is „subject to such
limitation and conditions as the requesting state may
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prescribe by executive order or otherwise.‟  LA. R.S.
29:751 (5).
The Fifth Circuit Court of Appeal stated in
Tradewinds that the applicability of the emergency
reciprocity of licensing provisions is for from a purely
legal issue, as it is premised on Tradewinds's proper
licensing in another state, which is a factual question.
Furthermore, Tradewinds' licenses and qualifications in
other states were not part of the record. Tradewinds, 573
at 266.
The record in this case is also devoid of any
alleged licenses of plaintiffs and its subcontractors.
Further, despite the Governor declaring a state of
emergency following Katrina, she did not sign an
executive order suspending the licensing laws. Lastly, all
the subcontractors were completely unlicensed and Mr.
Templet, LSLBC Compliance Director, was clear that all
contractors, sub or general, had to have their own
licenses in place and could not work under another
contractor's license. The Court is of the opinion that no
reciprocity exists in this case for these reasons.
Additionally, plaintiffs did not carry their burden
of proof of any potential claim in quantum meruit as
there was no contract entered into evidence. Further,
plaintiffs only provided a Xactimate estimate as their
proof of actual costs of labor, material and equipment.
Xactimate is an insurance tool used by insurance
companies to arrive at a national average so that
contractors are paid consistently throughout the nation.
This is simply not legally sufficient proof of actual costs
of labor, material and equipment as the law requires.
In Alonzo v. Chifici, 526 So.2d, 237 (La.App. 5 Cir
1989), a construction contract was found to be void for
failure to have proper licensure as required by law and
Mr. Alonzo's claim was limited in quantum meruit for
recovery of actual costs of material, services and labor
and he was not entitled to any profit or overhead.  The
Court disallowed cash expenditures and any charges
where invoices and cancelled checks did not match.
Alonzo, 526 at 244.  In yet another case involving Mr.
Alonzo and the Chificis, (Alonzo v. Chifici, 541 So.2d
303 (La.App.5 Cir.1989)), the Court disallowed a price
based on estimates where Mr. Alonzo testified that he
computed the estimated cost of construction without any
10




effort to itemize and, therefore, did not prove his claim
for compensation in quantum meruit. Alonzo, 541 at 306.
Having provided nothing more than estimated
costs from a computer estimate with no documentation
consisting of items such as written contracts with its
subcontractors describing their scope of work, invoices
from those subcontractors, proof of payment of invoices,
paid labor tickets, paid invoices for equipment rental and
material purchases and cancelled checks to prove
payment of other incurred costs such as travel, as well as
having no contract in evidence, plaintiffs are not entitled
to recover in quantum meruit.
Also admitted into evidence during the plaintiffs'
case was a notice of cancellation of the lien on the
Westbank Building.  After plaintiff rested, counsel for
Westbank and Lakeway moved that all claims of the
plaintiffs be involuntarily dismissed with prejudice. The
Court granted the motions due to the above stated
reasons.
The only surviving claim was Lakeway‟s third
party and reconventional demand seeking reimbursement
in full of the $678,360.37 paid to plaintiffs for work done
at the Westbank Building. In support Mr. Danny
Plunkett, an expert in construction engineering and
estimation, testified that ABC and Lindstrom charged for
a job that could not be done and that the building
remained wet and covered with mold even after ABC and
Lindstrom completed their work. He further testified that
the chance of success in remediating water damage to a
building significantly decreases after the first week and
there is no chance to remediate water damage after four
weeks requiring water soaked and damaged building
materials must be demolished at that point. He also
testified that all the work ABC/Lindstrom did had to be
demolished, as it should have been from the first, that
this was going to cost Lakeway another $492,800 and
that Lakeway received no value for the work plaintiffs
did, for which plaintiffs were paid $678,360.37.  Proof of
those payments is in evidence. Mr. Plunkett testified that
any reasonable, experienced and licensed contractor
knew or should have known that any attempt to dry
out/remediate a building after five weeks of building
materials being soaked from the Katrina's rain and full of
mold was futile and impossible to do.  Mr. Plunkett also
testified that none of the work done by plaintiff
contractors could be salvaged and all of the building's
11




materials, including the metal studs and sprinkler pipes,
had to be demolished. ABC/Lindstrom brought no
evidence to the contrary. The Court is of the opinion that
the uncontroverted testimony of Mr. Plunkett must be
accepted since plaintiffs produced no evidence to
controvert this testimony. Opinions and conclusions of
court-accepted experts are to be given great weight and
proper credit when their testimony is unimpeached,
uncontroverted and based on sound reasoning and on
established facts. Fuller v. Wal-Mari Stores, Inc., 519
So.2d 366 (La. App.2nd Cir.1988);.Louisiana Power and
LightCo. v. Roberis, 408 So.2d 54 (La.App. 3rd  Cir,
1982); Geismar v. General Gas Corp., 182 So.2d 769
(La. App. 1st Cir. 1966); Hebert v. Winn Dixie Stores of
Louisiana, et al, 426 So.2d 295 (La. App. 4th Cir. 1983).
Lakeway is therefore entitled to full recovery of the
monies paid to ABC/Lindstrom as it proved its claim by
a preponderance of evidence.
Appellants also argue on appeal that the trial court erred in refusing any
rebuttal evidence after Lakeway rested its case on the Reconventional Demand.
We find no merit in this assignment of error.  After the close of Lakeway‟s case,
counsel for Appellants asked the trial court for a negative inference based on the
fact that Lakeway listed an expert (Mr. Mike Dewey) but did not call him to
testify.  Lakeway responded that counsel for ABC/Lindstrom “filed a Motion In
Limine with a Daubert Exception …objecting to the qualifications of Mr. Dewey
saying that he was a Louisiana licensed contractor” and in order to cure the
problem, Lakeway chose to call “Mr. Plunkett who testified basically to the same
thing.”  ABC/Lindstrom could have called Mr. Dewey as a witness before resting
its case but chose not to do so.  Under these facts, we do not find that Lakeway
should be penalized by its failure to call more than one witness on the same
subject.
For these reasons, we hereby AFFIRM the judgment of the trial court.
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AFFIRMED
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