Preview:

LANTECH CONSTRUCTION CO., L.L.C. NO. 08-CA-811
VERSUS FIFTH CIRCUIT
DAVID SPEED d/b/a DRIFTWOOD SPUR COURT OF APPEAL
STATE OF LOUISIANA
ON APPEAL FROM THE TWENTY-FOURTH JUDICIAL DISTRICT COURT
PARISH OF JEFFERSON, STATE OF LOUISIANA
NO. 558-987, DIVISION "K"
HONORABLE MARTHA E. SASSONE, JUDGE PRESIDING

COURTOFAPPEAL MAY 26, 2009 FIFTH CIRCUIT
MARION F. EDWARDS JUDGE
Panel composed of Judges Marion F. Edwards, Susan M. Chehardy, and Fredericka Homberg Wicker WICKER, J., CONCURS
PATRICIA S. LeBLANC LeBLANC BUTLER, LLC 3421 North Causeway Boulevard Suite 301 Metairie, Louisiana 70002 COUNSEL FOR PLAINTIFFS/APPELLANTS
LEONARD L. LEVENSON
CHRISTIAN W. HELMKE
COLLEEN B. GANNON
Attorneys at Law
427 Gravier Street
Third Floor
New Orleans, Louisiana 70130
COUNSEL FOR DEFENDANT/APPELLEE-SECOND APPELLANT
AFFIRMED IN PART; REVERSED IN PART; AMENDED AND RENDERED
Both plaintiff/appellant, Wilbur J. Babin Jr., as trustee ofLanTech Construction Company, LLC ("LanTech"), and defendant/cross-appellant, David
peed d/b/a Driftwood Spur ("Speed"), appeal from a judgment ofthe district court granting Speed liquidated damages in the amount of $31,400 and the cost of concrete repairs in the amount of $112,212.50.
In January 2000, Speed entered into a contract with LanTech for the renovation/conversion of a Texaco station in Kenner. The initial price ofthe project was $203,507. In its Petition for Breach of Contract and Damages, LanTech averred that change orders increased the price to $217,874 ofwhich $45,598 remained unpaid. Ultimately, Speed filed a Reconventional Demand for sums expended to complete and/or repair the project, including the cost of removal and replacement of concrete. Speed also asked for liquidated damages for failure of LanTech to timely complete the project.
Trial commenced on December 13, 2004, at which time only Speed's

testimony was taken. After more delays, the parties agreed in 2008 to submit
depositions as trial testimony. On May 22, 2008, the trial court rendered its judgment, finding:
1.
That the parties entered into "very sloppy business practices," and that LanTech failed to show evidence that Speed signed any change orders as mandated by the contract.

2.
That Speed benefited by the work done and that LanTech was entitled to the cost ofthe change orders, subject to setoff for damages due to Speed.

3.
That the concrete work in the project was defective because ofthe poor workmanship of LanTech, and Speed was entitled to $112,212.50 for the cost ofrepairs.

4.
That Speed was entitled to liquidated damages in the amount of $31,400 as per the contract for failure to timely complete the project.


On appeal, LanTech urges that the trial court erred in failing to enforce the express provisions ofthe contract; that the trial court's ruling was inherently inconsistent in awarding the cost for the change orders but not the time to perform them; and that Speed's testimony was contradictory and unreliable and should have been disregarded in toto. On cross-appeal, Speed counters that the court erred in permitting any recovery by LanTech pursuant to change orders improperly executed and that there was no evidence that the cost ofthe change orders was approved, or that it was reasonable and justified. Speed also argues that the trial court erred in failing to grant his Motion for Involuntary Dismissal. However, the record was designated by both Lantech and Speed and contains no motion for involuntary dismissal. Therefore, we decline to consider that assignment of error.
In trial testimony, Speed testified that the architect, Charles Ward ofRozas-Ward Architects ("Ward"), designed a renovation ofthe premises in question. He stated that he did not "think" he had signed a contract with LanTech. Ward orally informed Speed that he knew someone (LanTech) who could handle the
renovations. LanTech and Speed orally agreed on a contract price of "around

$200,000." Kevin Marino ("Marino") was the contractor who worked on the premises. Since Marino left, the roofhas been repaired and some of the pipes had recently cracked in the slab. However, Speed stated that recent photographs shown to him at trial depict the premises as they looked when the job was completed, and the station has continued to be in use since August of 2000.
Speed complained to Ward about the renovations several times because of mistakes that were being made. Marino did not come every day. The concrete laid by LanTech is chipping, cracking, and dissolving. The City ofKenner told Speed he needed a "grease trap" behind the building, as well as a dike with a drain. Speed agreed that these items were required. The city also required extra pilings. In addition, Speed told Marino to fence in the property around the dumpster, which had to be moved from one side ofthe building to the other. Speed also wanted fencing around the air conditioning compressors. The air conditioning units had to be changed because the wrong ones were installed. There was an increase of $5000 in cost regarding the air conditioners, but Speed agreed with Marino to "leave it alone" because he didn't want to pull the units out. Some changes had to be made because of drainage and lighting problems. The neighbors did not want the big lights that had been installed, and Speed asked Marino to change them. Speed requested an upgrade change in ceiling tiles, which resulted in a delay.
Speed testified that he would pay Marino when he was given a bill and when Marino had completed a certain amount of work. He had heard that LanTech was going to go bankrupt and held back on paying Marino because of the problems he saw with the concrete. According to Speed, LanTech did not finish everything when it left the job. When Speed got the final bill, he did not pay it nor did he contact Ward to complain about what had not been completed.
Speed's deposition, which continued his trial testimony, was taken in 2007.

In contrast to that testimony, Speed denied having approved any extensions oftime
or changes in price. The delays occurred because no one was on the job.
Copies ofthe Change Orders submitted separately as exhibits by the
plaintiff/appellant and the defendant/appellee have significant discrepancies in
both the signatures and dates on which they were signed. They can be summed up
as follows:
Change Order #1-revision of gas company footings-add five
days.
Change Order #2-remove storefront, add seven days; block
work in storefront, add seven days; addition of a grease trap,
add five days; additional fencing at the rear, add three days;
upgrade of air conditioner, add five days.
Change Order #3-change of ceiling tiles-add fifty-five days.
LanTech's exhibit shows 400 days, clearly an error according
to Architect Charles Ward. Date of substantial completion
changed to June 2.
Change Order #4--additional concrete footage, add ten days.
Speed's exhibit shows addition of forty days, with a substantial
completion date of July 12.
Change Order #5-canopy drainage, add forty days. The
completion date is July 27.
Change Order #6-adding gate, enclosure around air
compressor, fir down between cigarette rack and ceiling, add
ten days. Date of substantial completion is August 10. Speed
was given credit for overage on contract time, thirty days at
$200 per day or $6000.

Ward testified by deposition that Speed was concerned about the delays in
the work. Speed received a credit of $6000 on Change Order #6 for the number of
days that the contractor was late. The change order work was discussed primarily
between Speed and Marino. The Application Certification for Payment stated that
the work was completed by August 10, 2000, but, due to issues with Speed about
the delay ofthe job and the quality ofthe concrete finish, the document was not
signed until March 21, 2001. Ward, who had authority to reject work that did not
conform to the contract, felt that the concrete was within the industry standard.
Ward did not receive notice of any deficiencies within the one-year period

established by the contract. The contract calls for a starting date of January 5, 2000, with a completion date ofMarch 10. According to the contract, the owner or contractor who desired a change order typically contacted the architect, who would figure out the details of the proposed change, have everyone agree on the price and delays, and then get a formal change order. The architect and the owner have to approve any change that would become a formal change order, which had to be submitted by the contractor to the architect and owner. Change orders are typically prepared and signed before the change is made, unless a construction change directive was issued, which was not the case here. In this case, Ward's actual involvement with the contract was administrative and very limited, and he was not usually involved with the change orders. Change Order # 3, dated July 5 was signed by him August 2, 2000 and by Marino on July 19. Ward believed that the delay in time for his signature was a result of discussing and negotiating the changes with Speed, and, once he felt Speed agreed, Ward signed the order. Order #s 4 and 5 were dated and signed by Ward and Marino on the same day. As before, Ward testified that the dates probably coincided with his visit to the job and a meeting to discuss change orders, signed at the owner's request after several meetings. The only way he would have signed is ifhe felt Speed had agreed to the changes.
In his deposition, Marino testified the original contract between Speed and LanTech called for ninety days completion at a price of $238,440 and was for a Texaco station. When the job was changed from a Texaco to a Spur station, the time went down to sixty days and the price to $203,500. According to Marino, Change Order # 1 involved a change of canopy footings and came from Speed's canopy company's engineer. Five days were added to the project, and Speed agreed to the changes. Change Order #2 involving concrete block work was done at Speed's request and added seven days. The Board ofHealth required a grease trap resulting in Change Order #3. Change Order #4 involved additional fencing requested by Speed. Change Order #5 involved a change in the number and tonnage ofAC units. These changes resulted in an additional $9694 added to the contract price and twenty-seven days to the completion deadline. Speed wanted the ceiling tiles upgraded, and he agreed to the increased cost of $593. Twenty

Download A3A85733-ADDD-4F06-A9F0-C0E98689DBB4.pdf

Louisiana Law