FOSTER-SOMERLED ENTERPRISES, LLC d/b/a ROOF OR CONSEQUENCES, LLC and SOMERLED CONSTRUCTION, LLC Plaintiffs-Appellants
ST. PAUL'S EPISCOPAL CHURCH, SHREVEPORT, LOUISIANA, GUIDEONE MUTUAL INSURANCE COMPANY and GUIDEONE TAYLOR BALL CONSTRUCTION SERVICES, LLC, d/b/a GC3 Defendants-Appellees
from the First Judicial District Court for the Parish of
Caddo, Louisiana Trial Court No. 587333-A Honorable Ramon
/REYNOLDS, LLC By: John O. Hayter, III Lauren H. Reynolds
Counsel for Appellants.
SMITH & ROBERTS, LLP By: Frank K. Carroll Counsel for
Appellee, St. Paul's Episcopal Church.
WALKER LLP By: Louis Simon, II Counsel for Appellee, GC3
d/b/a GuideOne Taylor Ball Const. Services, LLC
SCHUTTE, TERHOEVE, RICHARDSON, EVERSBERG, CRONIN, JUDICE
& BOUDREAUX By: Brad M. Boudreaux Sarah Eilts Assad Erin
O. Braud Counsel for Appellee, GuideOne Mutual Ins. Co.
BROWN, MOORE & PITMAN, JJ.
Foster-Somerled Enterprises, LLC, d/b/a Roof or Consequences,
LLC ("Foster"), and Somerled Construction, LLC
("Somerled"), appeal the judgment of the trial
court granting the exceptions of no cause of action and no
right of action in favor of Defendant-Appellee GuideOne
Mutual Insurance Company ("GuideOne"). For the
following reasons, we affirm in part, reverse in part and
remand for further proceedings.
September 4, 2015, Foster, a licensed home improvement
contractor providing services as a roofing contractor for
homes and small commercial projects, and Somerled, a licensed
commercial contractor, filed a petition for damages against
St. Paul's Episcopal Church, Shreveport, Louisiana
("St. Paul's"); GuideOne; and GuideOne Taylor
Ball Construction Services, LLC, d/b/a GC3 ("GC3").
In their petition, Plaintiffs alleged the following facts: In
February 2014, Foster's representative contacted St.
Paul's regarding possible hail damage to the church's
roof. St. Paul's representative stated that its roof had
been damaged and that its insurer, GuideOne, advised that the
roof needed repairs to the ridge caps and if not repaired,
the policy could be cancelled. Foster presented a contract to
St. Paul's to assist in making a claim on its insurance
policy and to perform the repairs to the roof with the
understanding that, if replacement was necessary, the
contract would be assigned to Somerled or another general
contractor and Foster would assume the role of a "not at
risk" construction manager. St. Paul's agreed and
signed a contract with Foster. Foster then conducted an
inspection of the entire roof system and determined that the
damages sustained were significantly greater than initially
presumed. It assigned the contract to Somerled as to the
scope of the damage was beyond Foster's licensing
threshold. On behalf of St. Paul's, Foster demonstrated
to GuideOne the level of damage to the church's roof and
convinced GuideOne that the entire roof system needed to be
replaced. The roof contained asbestos material, so Foster
contacted an asbestos contractor to perform its removal and
disposal. GuideOne was informed of the asbestos and the
additional expenses required for the abatement. Foster also
identified subcontractors and suppliers for certain aspects
of the project. It informed St. Paul's that the cost to
replace the roof system was approximately $3, 400, 000, which
would be paid by GuideOne under the insurance policy.
GuideOne then requested a separate meeting with St.
Paul's and GC3, excluding Foster and Somerled. During the
meeting, GuideOne and GC3 attempted to replace Foster and/or
Somerled as the contractor. In late April or early May, St.
Paul's asserted that there was no binding contract with
Somerled. St. Paul's, GuideOne and GC3 then adopted a
procedure to bid the project through GC3. They requested that
Somerled bid on the project, but Somerled refused because it
already had a contract with St. Paul's to perform the
work and because it could not engage in the bidding project
as it was not allowed by Louisiana licensing laws because GC3
is an unlicensed contractor in Louisiana. St. Paul's then
notified Somerled that its contract was being terminated for
convenience. Subsequent to termination, Somerled submitted
its invoice to St. Paul's for payment of the profit and
overhead in the contract in the amount of $575, 409.82.
Foster submitted an invoice to St. Paul's for its time
expended as a construction manager on the project in the
amount of $185, 580. Plaintiffs advised St. Paul's that
upon payment to Foster, this would be credited against the
amount owed to Somerled. At the date of the filing of the
petition, the roof of the church had not been replaced.
their petition, Plaintiffs argued that GuideOne and GC3
undertook a campaign to disparage the competency and defame
the reputation of Foster and Somerled and dishonor, interfere
with or otherwise cancel the binding contract of Foster
and/or Somerled with St. Paul's. Specifically, they
alleged that, in an attempt to coerce St. Paul's to
cancel the contract with Foster, GuideOne and GC3 disparaged
the reputation of Foster and Somerled, attempted to convince
St. Paul's that Foster and/or Somerled were not competent
to handle the project, threatened to cancel St. Paul's
insurance if it used Foster and/or Somerled for the project,
attempted to have St. Paul's cancel the contract held by
Somerled, misrepresented to St. Paul's that GC3 was a
Louisiana-licensed contractor that could perform the work,
advised St. Paul's not to pay profit and overhead charged
by Somerled under the contract and advised St. Paul's
that the project needed to be bid instead of honoring the
contract with Somerled. They further argued that the actions
of GuideOne, GC3 and St. Paul's constituted unfair trade
practices and that these actions resulted in the termination
of the contract. They contended that they are entitled to
damages in amounts to be proven at trial arising out of the
unfair trade practices and defamation perpetrated by St.
Paul's, GuideOne and GC3, together with interest,
attorney fees and all court costs.
September 24, 2015, GuideOne filed an exception of no cause
of action and no right of action. It argued that Plaintiffs
had not stated a cause of action for damages for unfair trade
practices because the applicable law, Louisiana's Unfair
Trade Practices and Consumer Protection Law
("LUTPA"), exempts actions regulated by the
Insurance Commissioner. It explained that Plaintiffs have no
right of action for unfair trade practices because the
Insurance Commissioner is the sole person who may assert a
cause of action under the Insurance Code for unfair trade
practices. It also argued that Plaintiffs failed to state a
cause of action for defamation.
January 28, 2016, Plaintiffs filed an opposition to the
exceptions of no cause of action and no right of action. They
argued that GuideOne failed to demonstrate that they do not
have a right of action and that the allegations fall under
the jurisdiction of the Insurance Commissioner. They further
argued that they stated a cause of action for defamation by
alleging that GuideOne made statements to St. Paul's that
Plaintiffs were not competent to handle the project.
hearing on the exceptions was held on February 8, 2016. The
trial court granted the exceptions and noted that defamation
is listed in La. R.S. 22:1964(3) as an unfair method of
competition and unfair or deceptive act or practice in the
business of insurance and is under the jurisdiction of the
Insurance Commissioner. On February 22, 2016, the trial court
filed a final judgment sustaining GuideOne's exceptions
of no cause of action and ...