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State Farm Fire and Casualty Co. v. Hotel Management of New Orleans, L.L.C.

Court of Appeals of Louisiana, Fourth Circuit

May 3, 2017

STATE FARM FIRE AND CASUALTY COMPANY
v.
HOTEL MANAGEMENT OF NEW ORLEANS, L.L.C.

         APPEAL FROM CIVIL DISTRICT COURT, ORLEANS PARISH NO. 2014-01412, DIVISION "I-14" Honorable Piper D. Griffin, Judge.

          James E. Brouillette THE LAW OFFICE OF JAMES BROUILLETTE, COUNSEL FOR PLAINTIFF/APPELLEE, STATE FARM FIRE AND CASUALTY COMPANY.

          Isaac H. Ryan Kermit L. Roux, III DEUTSCH, KERRIGAN & STILES, L.L.P., COUNSEL FOR DEFENDANT/APPELLANT, HOTEL MANAGEMENT OF NEW ORLEANS, LLC.

          Court composed of Judge Terri F. Love, Judge Madeleine M. Landrieu, Judge Joy Cossich Lobrano.

          TERRI F. LOVE JUDGE.

         A French Quarter hotel's fire prevention sprinkler activated, which caused water to leak into the gift shop below and damage merchandise. The gift shop owner's insurer filed suit against the hotel seeking repayment of insurance proceeds paid to the gift shop owner for the damage. The trial court found in favor of the insurer and ordered payment of $41, 662.05, plus court costs and legal interest from the date of demand. The hotel's appeal followed.

         We find that the trial court committed manifest error by finding in favor of the insurer because the insurer failed to meet its burden of proof of the hotel's negligence. The trial court's judgment is reversed, and judgment is rendered in favor of the hotel.

         FACTUAL BACKGROUND AND PROCEDURAL HISTORY

         On February 12, 2013, Mardi Gras, a sprinkler head located in the French Market Inn ("Hotel"), owned and operated by Hotel Management of New Orleans, LLC ("HMNO"), was triggered, causing water to leak into and flood portions of the storefront two floors below, operated by Hajera, Inc. d/b/a Best of NOLA ("storeowner"). The storeowner reported that water leaked into the store for almost two hours. HMNO did not attempt to shut off the sprinkler head. Instead, HMNO waited for the fire department to turn the sprinkler off. The storeowner suffered damages as a result.

         State Farm Fire and Casualty Company ("State Farm") insured the storeowner, and paid $41, 662.05 in damages on the storeowner's policy. State Farm then filed a Petition for Damages against HMNO, as a partial subrogee of the storeowner, seeking repayment of the $41, 662.05. State Farm added HMNO's insurer, Companion Property and Casualty Insurance Company ("Companion") as an additional defendant. Following a bench trial, the trial court found for State Farm and ordered the repayment of the stipulated $41, 662.05 in damages, plus court costs and legal interest from the date of demand. HMNO and Companion (collectively "Defendants"), suspensively appealed.

         The Defendants contend that the trial court erred by: 1) finding that the sprinkler was defective and that HMNO knew or should have known of the defect, 2) finding that the HMNO employees were negligent, and 3) denying HMNO's Motion for Involuntary Dismissal.

         STANDARD OF REVIEW

         "In civil cases, the appropriate standard for appellate review of factual determinations is the manifest error-clearly wrong standard." Hall v. Folger Coffee Co., 03-1734, p. 9 (La. 4/14/04), 874 So.2d 90, 98. "Under the manifest error standard, a factual finding cannot be set aside unless the appellate court finds that the trier of fact's determination is manifestly erroneous or clearly wrong." Detraz v. Lee, 05-1263, p. 7 (La. 1/17/07), 950 So.2d 557, 561. To reverse the factfinder, "an appellate court must review the record in its entirety and (1) find that a reasonable factual basis does not exist for the finding, and (2) further determine that the record establishes that the fact finder is clearly wrong or manifestly erroneous." Id. "The appellate court must not re-weigh the evidence or substitute its own factual findings because it would have decided the case differently." Id. "Where there are two permissible views of the evidence, the fact finder's choice between them cannot be manifestly erroneous or clearly wrong, even if the reviewing court would have decided the case differently." Id.

         "The manifest error standard of review also applies to mixed questions of law and fact." A.S. v. D.S., 14-1098, p. 10 (La.App. 4 Cir. 4/8/15), 165 So.3d 247, 254. Conversely, purely legal issues "are reviewed with the de novo standard of review." Gordon v. Gordon, 16-0008, p. 3 (La.App. 4 Cir. 6/8/16), 195 So.3d 687, 689.

         A motion for involuntary dismissal is reviewed using the manifest error standard of review. Ridgeway v. Pierre, 06-0521, p. 4 ...


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