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Gibbs Construction, L.L.C. v. National Rice Mill, L.L.C.

Court of Appeals of Louisiana, Fourth Circuit

February 21, 2018

GIBBS CONSTRUCTION, L.L.C.
v.
NATIONAL RICE MILL, L.L.C.

         APPEAL FROM CIVIL DISTRICT COURT, ORLEANS PARISH NO. 2012-12018, DIVISION "M" Honorable Paulette R. Irons, Judge

          Randall A. Smith Stephen M. Gelé Reagan Reynolds SMITH & FAWER, L.L.C. and Emile A. Bagneris, III THE BAGNERIS FIRM, LLC COUNSEL FOR DEFENDANT/APPELLANT, NATIONAL RICE MILL, L.L.C.

          C. Michael Pfister, Jr. Linda A. Hewlett DUPLASS, ZWAIN, BOURGEOIS, PFISTER, WEINSTOCK & BOGART COUNSEL FOR THIRD PARTY DEFENDANT/APPELLEE, FIREMAN'S FUND INSURANCE COMPANY

          Richard G. Duplantier, Jr. David M. Moragas Scott M. Raney, Sr. GALLOWAY, JOHNSON, TOMPKINS, BURR & SMITH COUNSEL FOR THIRD PARTY DEFENDANT/APPELLEE, ZURICH AMERICAN INSURANCE COMPANY

          Court composed of Judge Roland L. Belsome, Judge Joy Cossich Lobrano, Judge Marion F. Edwards, Pro Tempore

          Joy Cossich Lobrano Judge.

         This is an insurance coverage dispute arising from a claim for breach of construction contract and damages. Defendant/Appellant, National Rice Mill, L.L.C. ("Rice Mill"), appeals the district court's October 10, 2016 and October 20, 2016 judgments granting two motions for partial summary judgment. The October 10, 2016 judgment ruled that the water intrusion events that took place on September 4, 2011 and August 28, 2012 constitute two occurrences within the meaning of the applicable Westchester Surplus Lines Insurance Company ("Westchester") policies. The October 20, 2016 judgment dismissed Rice Mill's claims for delay damages/liquidation damages, loss of income/business reputation, and rent concessions. For the reasons that follow, we reverse both judgments and remand this matter for further proceedings.

         The following facts are pertinent to this appeal. Gibbs Construction, L.L.C. ("Gibbs") was the general contractor for an extensive renovation of the Rice Mill's luxury apartment complex, the Rice Mill Lofts (the "apartments"). Gibbs selected Rush Masonry, Inc. ("Rush") as the masonry restoration subcontractor for the renovation of the apartments. Westchester issued a policy of commercial general liability ("CGL") insurance to Rush, which was the primary layer of insurance during the policy periods of February 1, 2011 to February 1, 2012 and February 1, 2012 to February 1, 2013. Third Party Defendant/Appellee, Fireman's Fund Insurance Company ("Fireman's Fund") provided a policy of excess liability insurance to Rush during each of the aforementioned Westchester policy periods. Third Party Defendant/Appellee, Zurich American Insurance Company ("Zurich"), issued a CGL insurance policy to Gibbs for the policy periods of January 1, 2011 to January 1, 2012 and January 1, 2012 to January 1, 2013.

         The apartments experienced multiple instances of water intrusion, including a thunderstorm in July 2011, on September 4, 2011 during Tropical Storm Lee, and on August 28, 2012 during Named Storm Isaac. Subsequently, Gibbs filed suit against Rice Mill for failure to make payments under the general construction contract. Rice Mill filed a reconventional demand against Gibbs and third party demands against Rush, Zurich, and other parties.

         Thereafter, Fireman's Fund filed a motion for partial summary judgment, arguing that two separate weather events on September 4, 2011 and August 28, 2012 resulted in two occurrences of property damage, each during a separate Westchester policy period.

         Fireman's Fund and Zurich also each filed a motion for partial summary judgment, arguing that Rice Mill's claims for management fees, damage to "your work, " delay damages or reduction in contract price by liquidated damages, rent concessions, loss of business reputation, and mold remediation are not "property damage" as required for coverage under the respective Fireman's Fund and Zurich policies.[1]

         On June 16, 2016, the district court held a hearing, at which the court ruled from the bench on the respective motions for partial summary judgment. The district court granted partial summary judgment in favor of Fireman's Fund, finding that the water intrusion events on September 4, 2011 and August 28, 2012 constitute two occurrences. As to the motions for partial summary judgment filed by Fireman's Fund and Zurich, the district court granted the motions in part and dismissed Rice Mill's claims for "delay damages or liquidation damages, " "loss of income/business reputation, " and "rent concessions."

         On September 9, 2016, Rice Mill filed a motion to have the district court's judgments designated as final. On October 10, 2016, the district court signed and rendered judgment as to Fireman's Fund's and Zurich's motions for partial summary judgment on the dismissed categories of damages. On October 20, 2016, the district court signed and rendered judgment as to Fireman's Fund's motion for partial summary judgment on number of occurrences.

         This appeal followed. Rice Mill sets forth two assignments of error on appeal, arguing that the district court erred in (1) granting partial summary judgment dismissing claims for particular categories of damages, and (2) granting partial summary judgment finding that the water intrusion constituted two occurrences.

         Before discussing the merits of this appeal, we first address whether this Court has appellate jurisdiction to review the October 20, 2016 judgment rendered by the district court. On October 13, 2016, Rice Mill filed a motion for appeal relative to two judgments, both purportedly rendered on October 10, 2016, in particular:

a) That certain judgment dated October 10, 2016 granting a Motion for Partial Summary Judgment on the number of occurrences and coverage triggers filed by Fireman's Fund; and
b) That certain judgment dated October 10, 2016 granting in part Motions for Partial Summary Judgment filed by Fireman's Fund and Zurich.

         The district court signed the order of appeal on October 17, 2016. The record before us, however, contains only one judgment dated October 10, 2016, which was the judgment granting Fireman's Fund's motion for partial summary judgment relative to the number of occurrences. The record lacks a second judgment dated October 10, 2016. Rather, the record reflects that the judgment granting in part the motions for partial summary judgment filed by Fireman's Fund and Zurich, dismissing claims for certain categories of damages, was not signed until October 20, 2016.

         This Court ordered the parties to submit briefs addressing whether Rice Mill's appeal of the October 20, 2016 judgment should be dismissed as premature and/or as the order of appeal does not reference the October 20, 2016 judgment. Responding to this Court's order, Rice Mill argues that its appeal should not be dismissed and urges this Court to follow its holding in Law Office of Paul C. Miniclier, PLC v. Louisiana State Bar Ass'n, 2014-1162, p. 4 (La.App. 4 Cir. 5/27/15), 171 So.3d 1013, 1015. In Miniclier, the district court signed an order of appeal referencing a judgment not in the record, and only after the order of appeal was signed did the district court sign and render the judgment that Miniclier had intended to appeal. Id., 2014-1162 at p. 3, 171 So.3d at 1014. This Court, following the Supreme Court's ruling in Overmier v. Traylor, 475 So.2d 1094 (La. 1985), held that "[e]ven though the appeal order was initially premature because it was filed and signed after the trial court rendered oral judgment, but before the judgment was reduced to writing and signed, once the judgment was signed the defect was cured." Id., 2014-1162 at p. 4, 171 So.3d at 1015.

         We agree with Rice Mill's argument that Miniclier applies. We find that both the October 10, 2016 and October 20, 2016 judgments are properly before this Court on appeal, and we next address the merits of the appeal.

         Appellate courts review a grant of a motion for summary judgment de novo using the same criteria district courts consider when determining if summary judgment is proper. Kennedy v. Sheriff of E. Baton Rouge, ...


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