STATE OF LOUISIANA, THROUGH ITS DEPARTMENT OF TRANSPORTATION AND DEVELOPMENT
TAIRA LYNN MARINE LIMITED NO 7, L.L.C., D & S MARINE SERVICE, L.L.C., AND JOHN DOE
APPEAL FROM THE TWENTY-THIRD JUDICIAL DISTRICT COURT PARISH
OF ST. JAMES, STATE OF LOUISIANA NO. 33, 114, DIVISION
"A" HONORABLE JASON VERDIGETS, JUDGE PRESIDING
COUNSEL FOR PLAINTIFF/APPELLEE, STATE OF LOUISIANA, THROUGH
ITS DEPARTMENT OF TRANSPORTATION AND DEVELOPMENT Jose' R.
Cot Robert K. Denny
COUNSEL FOR DEFENDANT/APPELLANT, TAIRA LYNN MARINE LIMITED NO
7, L.L.C., D & S MARINE SERVICE, L.L.C. Wayne G.
Zeringue, Jr. Jefferson R. Tillery Christopher K. Ulfers
composed of Judges Susan M. Chehardy, Hans J. Liljeberg, and
Marion F. Edwards, Judge Pro Tempore.
F. EDWARDS, JUDGE PRO TEMPORE JUDGE
issue presented for our review in this matter relates to the
proper method of calculating depreciation for purposes of
awarding compensatory damages in a case involving an
allision of a towboat and barges with a fender of
the Sunshine Bridge. For reasons that follow, we affirm.
parties stipulated to the facts, liability and cost of
repairs before trial. According to the joint stipulation, on
April 11, 2008, the M/V RICKY J. LEBOUEF, owned by Taira Lynn
Marine Limited No. 7, L.L.C. (Taira Lynn), and operated by
D&S Marine Services, L.L.C. (D&S), allided with the
Sunshine Bridge Pier No. 4 fender system. At the time of the
allision, the M/V RICKY J. LEBOUEF was towing two barges.
River currents caused the tow to allide with the downstream
fender of the Sunshine Bridge, causing extensive damage and
requiring an expenditure of $1, 569, 544.75 for repairs. Both
Taira Lynn and D&S stipulated to liability for the
allision, but reserved their right to litigate all aspects of
State of Louisiana, through its Department of Transportation
and Development (DOTD), filed suit against Taira Lynn and
D&S to recover the cost of repairs to the bridge. As a
result of the joint stipulation, the only remaining issues
before the trial court at the trial on the merits concerned:
1.) whether the claims of the DOTD are subject to a reduction
for depreciation, and if so, the appropriate rate of
2.) whether the value engineering proposal to replace the
timber Pier No. 4 fender system with a timber and steel
fender system was properly accepted, and if so whether Taira
Lynn is entitled to any credit for the savings realized
pursuant to the value engineering proposal;
3.) Whether Taira Lynn is entitled to a credit for the bid
bond forfeited by Johnson Bros. Construction when it withdrew
its successful bid for State Project No. H. 002926.6.
trial on the merits, the trial court rendered judgment
decreeing that the DOTD was entitled to a recovery of $720,
696.58 plus judicial interest pursuant to La. R.S.
13:4203. The trial court issued written reasons
for judgment in which it detailed the reasoning for the
reduced award. Specifically, the court made a determination
that a 50% depreciation rate was appropriate, and that
defendants were entitled to a bid bond credit in the amount
of $64, 075.80. Both defendants appealed that judgment,
arguing that the trial court erred in its determination that
depreciation should be "capped" at 50%.
sole issue presented to this Court relates to the
determination of depreciation applicable to the award of
damages. As previously stated, the trial court used a 50%
depreciation rate in its award of damages.
Taira Lynn and D&S, argue that the trial court erred as a
matter of law by applying a portion of the Truman-Hobbs
Bridge Act of 1940 (Truman-Hobbs) embodied in 33 C.F.R.
§ 277.8(g)(2), which suggests a 50% depreciation on the
expired service life of the structure in establishing
depreciation. Appellants assert that a straight-line
depreciation analysis using a ratio of the property's
actual life divided by the property's expected useful
life at acquisition is appropriate. Using that analysis,
appellants argue that, in this instance, the actual life is
45 years and the expected useful life at acquisition is 50
years, resulting in a depreciation of 90%. Appellants
conclude the trial court's ruling on this issue is an
error of law which invokes a de novo review in this
counters appellants' arguments by pointing out that
general maritime law does not impose a fixed rule for the
calculation of depreciation. DOTD asserts that other factors,
such as the type of materials originally used, the care and
use, and the state of repair maintained are all essential
elements to be considered in the determination of the
applicable rate of depreciation. DOTD also disputes
appellants' conclusion that the applicable standard of
review is de novo, and asserts that the award of
damages should be upheld because it is not clearly erroneous.
at trial established that the Sunshine Bridge is a steel
continuous truss bridge built in 1963. The top is the
superstructure, or the actual truss. From the truss down is
soft structure, incorporating wood timbers. There is a fender
system to protect the bridge in the event of an extreme
impact. Pier 4, part of the fender system, was damaged in
this incident. Repair was an "in kind" repair,
meaning that the same configuration and clearances as
originally constructed were used.
trial court heard testimony from two experts in bridge
engineering on the topic of depreciation analysis. DOTD
presented evidence from Zolan Prucz, Ph.D, P.E., whose firm
was hired to repair the bridge. Dr. Prucz recommended a 50%
depreciation based on the Truman-Hobbs guidelines as
evaluated, and on all other conditions of this specific
bridge as it relates to similar structures spanning the
Mississippi River nearby, namely the Huey P. Long Bridge and
the Crescent City Connection.
Prucz explained that the factors used to determine the
service life of a fender system include the type of
structure, the material used, the function and conditions to
which it is exposed, performance expectations, age, and
maintenance and repair history. Dr. Prucz testified that the
Truman-Hobbs Bridge Act provides guidance in this
determination in that it contains service life estimates
agreed upon in the industry.
Prucz clarified the difference between the expected service
life of a structure and the actual service life. He stated
that values presented relating to expected service life refer
to the expectation of a structure when new, i.e., the
probable life. These values do not take into account the
condition of the structure at any given time. They are based
on statistics of service life of similar structures in the
past. In short, the concept of expected useful life applies
to a future projected useful life of a new structure. Actual
service life, in comparison, relates more to structures that
have been in existence and have a history of performance,
and/or a quantifiable nature of deterioration over the years.
evaluating and rendering a professional opinion on the useful
life of a structure such as Pier 4, the actual useful life,
as opposed to the expected useful life, is a more accurate
and a better measure of the useful life of the structure for
purposes of depreciation in Dr. Prucz's professional
opinion. Dr. Prucz estimated a 50 year expected useful life
for the Sunshine Bridge. He stated that the fender was in
good condition when it was removed, with some newer timbers
showing ongoing maintenance.
Lynn and D&S offered the testimony of Donald Barnes, P.E.
who opined that the depreciation rate should be increased to
75% based on inadequate maintenance and condition of the
pier. Although Mr. Barnes did find some newer timbers, he
disagreed with Dr. ...