FROM CIVIL DISTRICT COURT, ORLEANS PARISH NO. 2012-03078,
DIVISION "L-6" Honorable Kern A. Reese, Judge
Lawrence G. Pugh, III William W. Sentell, III PUGH, ACCARDO,
HAAS, RADECKER & CAREY L.L.C. and Stanley J. Cohn
LUGENBUHL, WHEATON, PECK, RANKIN & HUBBARD COUNSEL FOR
Raymond A. Pelleteri, Jr. Alexander R. Saunders PELLETERI
& WIEDORN, L.L.C. and Charles L. Stern, Jr. Ryan M.
McCabe Elise M. Henry THE STEEG LAW FIRM, L.L.C. COUNSEL FOR
DEFENDANT/APPELLANT (NEW JAX CONDO ASSOCIATION, INC.)
B. Kaplan Jeffrey G. Lagarde BERNARD CASSISA ELLIOTT &
DAVIS, A PLC COUNSEL FOR DEFENDANT/APPELLANT (LAFAYETTE
composed of Judge Rosemary Ledet, Judge Sandra Cabrina
Jenkins, and Judge Regina Bartholomew-Woods
CABRINA JENKINS JUDGE.
a jury trial, the trial court rendered judgment in favor of
FIE, LLC ("FIE") and Iberia Tigers, LLC
(collectively, "plaintiffs"), and against New Jax
Condominium Association, Inc. ("New Jax") and
Lafayette Insurance Company (collectively,
"defendants"), in solido, in the amount of
$1, 185, 700.00 for the loss of use of plaintiffs'
condominium unit. In the first of these consolidated appeals,
defendants seek reversal of the trial court's judgment
and the dismissal of plaintiffs' claims for loss of use
damages. In an answer to defendants' first appeal,
plaintiffs seek reversal and remand on the trial court's
pre-trial judgment precluding plaintiffs from introducing
evidence at trial to support a claim for bad faith damages
the pendency of the first appeal, plaintiffs filed a motion
to tax costs of the trial against defendants, which the trial
court granted in part, assessing court costs and expert fees
in the amount of $49, 862.92 against defendants. Defendants
then filed an appeal of the trial court's judgment
assessing costs of the trial. This Court ordered that the two
appeals be consolidated.
on our review of the record and the applicable law, we affirm
the trial court's March 24, 2016 judgment finding
defendants jointly liable to plaintiffs for the loss of use
damages awarded by the jury. We also affirm the trial
court's March 2, 2016 pre-trial judgment challenged by
plaintiffs in their answer to the first appeal. Finally, we
affirm the trial court's January 6, 2017 judgment
assessing costs and expert fees.
Chris Jordan is the sole member and manager of FIE and Iberia
Tigers, LLC ("Iberia Tigers"), through which Mr.
Jordan acquires mostly commercial properties for investment
purposes. In May 2007, FIE purchased Unit 5-C in the New Jax
Brewery building, located at 640 Decatur Street, which is
managed and operated by New Jax. FIE later transferred
ownership of Unit 5-C ("the condo") to Iberia
Tigers. According to Mr. Jordan, the condo was purchased as
an investment property and for his personal use to entertain
family, friends, or clients during visits to New Orleans.
the first year of acquiring the condo, Mr. Jordan observed
water intrusion in areas of the condo directly below the roof
of the building. Mr. Jordan reported the water intrusion to
Earl Weber, Jr., the President of the Board of New Jax, and
requested that repairs be made to the roof to stop the water
April 2008, finding that New Jax had not yet made successful
attempts to repair the roof and stop the water leaks, Mr.
Jordan began withholding the monthly condo assessment fees
owed by FIE to New Jax.
2009, New Jax made attempts to discover the source of the
water leaks by cutting holes in the ceiling and walls of the
condo; during this process, New Jax tarped off the perimeter
of the condo with Visqueen plastic sheeting. At that point,
Mr. Jordan found the condo uninhabitable and unusable for its
intended purpose. Between July 2009 and October 2011, Mr.
Jordan corresponded with New Jax by email about ongoing water
leaks, damage to furniture, and the presence of black mold
growth in the condo; along with each complaint, he constantly
sought updates from New Jax on the status of the roof
repairs. During that same two year period, New Jax reported
several times to Mr. Jordan that attempts were being made to
find the source of the water leaks, that roofers were making
repairs to the roof, and that the condo was being monitored
for further water leaks. However, by 2012, the roof had not
been repaired successfully; and, on March 28, 2012,
plaintiffs instituted this suit for damages against
2012, plaintiffs hired Greg Fisher, a roofing contractor and
consultant, to perform a visual inspection of the roof above
the condo and prepare a report of his findings. During his
initial inspection, Mr. Fisher observed that limited remedial
repair work was being undertaken on the roof, and he
recommended that water tests be performed to assess the
effectiveness of that work. In October 2012, Mr. Fisher
returned for a second visual inspection and he observed that
a significant component of the roof-the standing seam metal
roofing-had been completely removed and no temporary
waterproofing material had been installed to protect the
building from the weather. He returned a week later and
observed that Visqueen had been installed to cover the
portion of the roof that had been removed; however, he did
not observe progress in the completion of the repairs. Mr.
Fisher discussed his observations with Mike Storms, New
Jax's maintenance manager overseeing the roof repairs,
and he recommended that New Jax hire a "competent
roofer" to perform all necessary roof repairs due to the
complex nature of the building's roofing system.
Subsequently, by letter dated November 21, 2012, plaintiffs
formally requested that New Jax hire a competent roofer to
repair the roof.
December 2012, New Jax hired Paul Couget to install a new
roof over the condo. In January 2013, Mr. Couget submitted an
invoice to New Jax for the completed installation of a
"standing seam snap lock roof system complete with all
necessary trim, flashing, and closures." Despite these
repairs, Mr. Jordan continued to find water leaks in the
condo, and he reported to New Jax that the condo had
sustained further water damage and mold growth during the
months that the roof was removed. In April 2013, plaintiffs
and New Jax came to an agreement that New Jax would gut the
affected areas of the condo but no interior repairs would
take place until the recurring leaks were repaired
April 2014, New Jax held an annual Board meeting at which all
new Board members were elected. In July 2014, the newly
elected Board of New Jax hired a new property management
company and a roofing consulting firm, BE-CI, to assess the
roof. On August 4, 2014, BE-CI issued a detailed report of
its findings and recommendations for necessary repairs. In
September 2014, New Jax hired Acadian Waterproofing to
complete the repairs outlined in BE-CI's report.
2015, a hard rain tested the roof repairs and provided
confirmation that the roof and water leaks had been repaired
successfully. Soon thereafter, repair work began on the
interior of the condo. All repairs were complete by September
15, 2015-seventy-five months after Mr. Jordan had first
reported that the condo was unusable.
filed this suit for damages against New Jax on March 28,
2012. In the original petition, plaintiffs alleged that,
since 2009, water leaking from the roof of the New Jax
property had caused extensive damage to their condo, making
it uninhabitable, as a direct result of New Jax's
negligence in failing to maintain and repair the
roof. Plaintiffs sought damages for the loss of
use of the condo, subsequent rental value, the cost of
reconstruction, and the loss of personal enjoyment.
March 11, 2013, plaintiffs filed their first supplemental and
amended petition alleging further damages as a result of New
Jax's "ineffective, negligent effort to repair the
exterior roof, " and naming New Jax's liability
insurer, Lafayette Insurance Company ("Lafayette"),
as a jointly liable defendant. Subsequently, in a third
supplemental and amended petition, filed on March 27, 2014,
plaintiffs asserted an additional claim against Lafayette for
bad faith pursuant to La. R.S. 22:1892, and, after being
granted leave to file a fourth supplemental and amended
petition on July 7, 2015, plaintiffs added a claim for the
recovery of attorney's fees pursuant to La. R.S.
answering the petition, New Jax filed a reconventional demand
against plaintiffs for failure to pay monthly condo
assessment fees as required by New Jax's Declaration and
By-Laws. New Jax asserted that plaintiffs had failed to pay
their monthly condo assessment fee of $1, 418.07 since April
2008. New Jax sought all amounts due, owing, and accruing
through the period of proceedings, as well as an acceleration
of fees for one year, pursuant to La. R.S. 9:1123.115(A)(1)
of the Louisiana Condominium Act. In total, New Jax sought
judgment against plaintiffs for $96, 424.74, together with
legal interest, attorney's fees, and costs.
to trial, which was continued from its original setting of
September 15, 2014 to March 7, 2016, the parties engaged in
protracted motion practice, which narrowed the claims and
issues proceeding to trial. At the time of trial, the only
claims remaining for adjudication were plaintiffs' claim
for loss of use damages and defendants' reconventional
demand for unpaid condo assessment fees.
a five-day jury trial, the jury returned the following
findings and award on plaintiffs' main demand:
Do you find that New Jax breached its obligation owed to
plaintiffs under the contract between the parties? Answer:
Do you find the defendant New Jax was negligent in the repair
process through the common element roof above plaintiffs'
Unit 5-C? Answer: Yes.
Do you find that the negligence of New Jax was a legal cause
of damage to the plaintiffs? Answer: Yes.
Please state the sum of money that would reasonably
compensate plaintiffs for the following: LOSS OF USE. Answer:
$1, 185, 700.
Jax's reconventional demand, the jury found plaintiffs
owed New Jax condo assessment fees for the period of April 1,
2008 through September 15, 2015, in the amount of $63,
March 24, 2016, the trial court rendered a final judgment as
follows: on the main demand, judgment in favor of plaintiffs
and against defendants, in solido, in the amount of
$1, 185, 700, with interest from March 28, 2012; on the
reconventional demand, judgment in favor of defendants and
against plaintiffs in the amount of $63, 563.15, with
interest from October 31, 2012; and reserving the
parties' claims for attorneys' fees and costs to be
determined in later proceedings.
March 31, 2016, New Jax filed a motion for new trial or, in
the alternative, a motion for remittitur. After hearing
arguments on the motion, the trial court rendered judgment on
May 23, 2016, denying New Jax's motion for new trial and
motion for remittitur.
then filed a timely suspensive appeal from the trial
court's March 24, 2016 judgment in favor of plaintiffs
for loss of use damages and the trial court's May 23,
2016 judgment denying the motion for new trial. After the
lodging of the record of this appeal, plaintiffs filed a
timely answer to the appeal, seeking reversal of the trial
court's March 2, 2016 pre-trial judgment granting
Lafayette's motion in limine to preclude plaintiffs from
presenting evidence of a bad faith claim under La. R.S.
22:1892(A)(4) at trial.
the appeal of the trial court's March 24, 2016 judgment
was pending before this Court, plaintiffs filed a motion to
tax costs, seeking all of the costs of the trial to be
assessed against defendants. On January 6, 2017, the trial
court rendered judgment granting, in part, plaintiffs'
motion to tax costs and assessing court costs and specified
expert fees against defendants in the amount of $49, 862.92.
Defendants then timely appealed the trial court's January
6, 2017 judgment.
appeals were consolidated by this Court on its own motion.
Appeal of March 24, 2016 Judgment
raise joint assignments of error regarding plaintiffs'
claim for loss of use, whether plaintiffs' claim sounds
in tort or contract, and prescription. Each defendant also
raises separate assignments of error. New Jax assigns error
to the trial court's exclusion of trial testimony
regarding rental values and to the trial court's
pre-trial judgment finding no policy coverage for
attorney's fees awarded as damages under its insurance
policy with Lafayette. Finally, in its own defense of the
judgment, Lafayette asserts policy coverage defenses to its
liability for the loss of use damages. We begin our
discussion by addressing the joint assignments of error.
to Claim Loss of Use
their first assignment of error, defendants argue that the
trial court erred, as a matter of law, in allowing
plaintiffs, two limited liability companies, to recover
damages for loss of use. During pre-trial litigation, this
legal issue of plaintiffs' right to claim loss of use was
raised by both parties in cross-motions for partial summary
judgment. After an initial hearing on the issue, the
trial court denied both parties' motions. Subsequently, the
parties filed a joint motion for reconsideration of their
cross motions for partial summary judgment on this unresolved
issue. After a second hearing, the trial court granted
plaintiffs' motion for partial summary judgment on the
right to claim loss of use and to present evidence of the
ready market value of substitute property as the measure of
damages for loss of use.
Court reviews a trial court's ruling on a motion for
summary judgment de novo. Sutherland v. Alma
Plantation, L.L.C., 15-1136, p. 4 (La.App. 4 Cir.
5/4/16), 193 So.3d 1178, 1181. "Appellate courts use the
'same criteria that govern the trial court's
consideration of whether summary judgment is
appropriate.'" Weintraub v. State Farm Fire
& Cas. Co., 08-0351, p. 2 (La.App. 4 Cir. 10/29/08),
996 So.2d 1195, 1196-97, quoting Supreme Servs. and
Specialty Co., Inc. v. Sonny Greer, Inc., 06-1827, p. 4
(La. 5/22/07), 958 So.2d 634, 638. Pursuant to La. C.C.P.
art. 966(B)(2), a motion for summary judgment shall be
granted if the motion, memorandum, and supporting documents
show that there is no genuine issue as to material fact and
that the mover is entitled to judgment as a matter of
The party moving for summary judgment bears the burden of
proof. La. C.C.P. art. 966(C)(2). The adverse party bears the
burden to produce factual support sufficient to establish the
existence of a genuine issue of material fact or that the
mover is not entitled to judgment as a matter of law.
addition, when the question before the appellate court is
whether the trial court erred in ruling on an issue of law,
we conduct a de novo review of the record, giving
deference to the trial court's factual findings which
will not be disturbed absent manifest error. Wirthman-TAG
Constr. Co., L.L.C. v. Hotard, 14-1394, 14-1395, p. 3
(La.App. 4 Cir. 8/19/15), 176 So.3d 429, 432, quoting
Wooley v. Lucksinger, 09-0571, 09-0584-86, p. 49
(La. 4/1/11), 61 So.3d 507, 554.
argue that the trial court erred in granting plaintiffs'
motion for partial summary judgment and allowing plaintiffs
to claim loss of use damages, because Louisiana law does not
permit corporate entities such as plaintiffs to recover
non-pecuniary, non-economic loss of use damages. Defendants
assert that corporate entities can suffer only economic
damages and, in this case, it is undisputed that plaintiffs
did not suffer any economic loss to the entities as a result
of the loss of use of the condo. Thus, defendants argue that
plaintiffs are not entitled to claim non-pecuniary damages
for loss of use as a matter of law.
support of their argument, defendants rely primarily on
federal jurisprudence. See AT&T Corp. v. Columbia
Gulf Transmission Co., (W.D. La. 2008), unpub.,
2008 WL 4585439 (holding that a corporate entity is not
entitled to recover damages for loss of use when there is no
evidence that the corporation suffered lost revenues or
profits); Kelly v. Porter, Inc., 687 F.Supp.2d 632,
638 (E.D. La. 2010) (holding that a juridical entity can
suffer only economic damage and cannot recover non-pecuniary
damages and dismissing plaintiff LLC's claim for loss of
use); Walle Corp. v. Rockwell Graphics Sys., Inc.,
(E.D. La. 1992), 1992 WL 245963, at *5 (holding that a
corporation cannot recover inconvenience damages or any
non-pecuniary damages). Defendants also cite one Louisiana
state case, Whitehead v. American Coachworks, Inc.,
02-0027 (La.App. 1 Cir. 12/20/02), 837 So.2d 678, in which
the First Circuit reversed a general damages award in favor
of the corporate plaintiff for loss of enjoyment and use of a
vehicle, mental anguish, and inconvenience. The First
Circuit reasoned that "State Farm, a corporation, is
incapable of experiencing loss of enjoyment, mental anguish,
and inconvenience." Whitehead, 02-0027, p. 6
(La.App. 1 Cir. 12/20/02), 837 So.2d at 682, citing City
of New Orleans, 241 So.2d at 10.
federal jurisprudence may be instructive in certain areas
where Louisiana law and jurisprudence is silent, we find, in
this case, that the trial court correctly interpreted and
applied the controlling precedent of Chriss v. Manchester
Ins. & Indem. Co., 308 So.2d 803 (La.App. 4th Cir.
1975). In Chriss, this Court held that property
owners are entitled to be compensated for the loss of use of
their property and distinguished such damages from those
awarded for mental anguish. This Court reasoned as follows:
Louisiana courts have allowed recovery of damages for mental
anguish in cases involving other torts, such as trespass,
assault, and other acts involving the violation of recognized
individual rights. These compensatory damages have been
awarded whether or not the violation causes pecuniary damage,
since such violations self-evidently result in mental
In negligence cases involving injury to property this court
has limited recovery of damages for emotional stress
(unaccompanied by physical injury) to those cases where the
disturbance causes bodily harm or illness.
Damages are recoverable, however, for loss of normal use of
… Furthermore, damages for loss of use are recoverable
whether the property is used for business or personal
The normal measure of damages for loss of use is the rental
value of similar property and perhaps necessary incidental
expenses. It is not necessary, however, that a plaintiff
actually rent substitute property in order to recover damages
due for loss of use. Rental (which accomplishes the
substitution of the use of similar property for that of the
injured property) does not determine entitlement to damages,
but only provides a fair measure of damages in appropriate
The period of compensatory loss of use is the time required
to secure the repair of the property in the exercise of
Chriss, 308 So.2d at 805-06 (internal citations
reasoned by this Court in Chriss, there is a
distinction between a mental anguish claim allegedly related
to property damage and a claim for the loss of use of
property. A non-economic loss of use occurs when the
owner's normal use of the property is restricted by
defendant's acts and, consequently, the owner's
rights of ownership are disturbed.
ownership of property includes the rights to possess it, use
it, enjoy the use of it, and dispose of it. See Eagle
Pipe and Supply, Inc. v. Amerada Hess Corp., 10-2267,
10-2272, 10-2275, 10-2279, 10-2289, pp. 10-11 (La. 10/25/11),
79 So.3d 246, 258; Giroir v. Dumesnil, 248 La. 1037,
1050, 184 So.2d 1, 6 (1966). When any of these rights of
ownership are disturbed by an injury or damage to the
property through the acts of another, the owner of the
property obtains a personal right of action against the one
causing the damage. Eagle Pipe, 10-2267, pp. 42-43,
79 So.3d at 277; see also, La. C.C. art. 2315
("Every act whatever of man that causes damage to
another obliges him by whose fault it happened to repair
it."). In this case, plaintiffs are juridical persons
with full rights of ownership in the property at issue.
See La. C.C. 479; Ogea v. Merritt, 13-1085,
p. 6 (La. 12/10/13), 130 So.3d 888, 894; see also
La. R.S. 12:1301. As such, plaintiffs are entitled to bring a
claim against defendants for the damage to their property and
to their rights of ownership.
we find the damages claimed for the loss of use of property
are compensatory in nature. Compensatory damages are those
awarded on the basis of the loss suffered and are designed to
replace the loss caused by the wrong or injury. See
McGuire v. Kelly, unpub., 10-0562 (La.App. 1
Cir. 1/30/12), 2012 WL 602366, *16. "Compensatory
damages are further divided into the broad categories of
special damages and general damages. Special damages are
those which have a 'ready market value, ' such that
the amount of the damages theoretically may be determined
with relative certainty." McGee v. A C And S.
Inc., 05-1036, p. 3 (La. 7/10/06), 933 So.2d 770, 773.
By contrast, general damages include those things which are
inherently speculative in nature and cannot be measured
definitively in terms of money. Id., 05-1036, pp.
3-4, 933 So.2d at 774. Accordingly, loss of intellectual or
physical enjoyment, or other loss of lifestyle, fall into the
category of general damages because they are inherently
speculative and have no measurable monetary value; however,
loss of use of property falls within the category of special
damages because it can be measured fairly and to a degree of
relative certainty by the rental value of substitute
property. See McGee, 05-1036, p. 4, 933 So.2d at
774; Chriss, 308 So.2d at 805-06; see also,
Nunez v. St. Bernard Parish Fire Dep't, 519
So.2d 857, 862 (La.App. 4th Cir. 1988). In this case,
plaintiffs sought to be compensated for the loss of use of
their property, as a result of defendants' negligence,
which was measured to a degree of reasonable certainty by the
rental value of substitute property.
light of the applicable law and jurisprudence, we find no
error in the trial court's judgment granting
plaintiffs' motion for partial summary judgment and
allowing plaintiffs to recover loss of use damages as
measured by the rental value of substitute property. Thus, we
find no merit in defendants' first assignment of error.