HAMP'S CONSTRUCTION, L.L.C.
1031 CANAL, L.L.C.
FROM CIVIL DISTRICT COURT, ORLEANS PARISH NO. 2015-08240,
DIVISION "B-1" Honorable Rachael Johnson
N. Shields Jessica R. Derenbecker Jeffrey K. Prattini SHIELDS
MOTT L.L.P. COUNSEL FOR PLAINTIFF/APPELLEE
Harris JAY J. HARRIS, LLC COUNSEL FOR DEFENDANT/APPELLANT
composed of Judge Rosemary Ledet, Judge Sandra Cabrina
Jenkins, Judge Dale N. Atkins
N. ATKINS JUDGE
Canal, L.L.C. ("1031 Canal"), appeals the trial
court's April 5, 2018 judgment granting summary judgment
in favor of Hamp's Construction, L.L.C.
("Hamp's"). Finding that a question of fact
exists regarding whether Hamp's defaulted under the
contract and whether such default, if it occurred, triggered
a setoff under the contract, we reverse the trial court's
judgment granting summary judgment and remand for further
Canal is the owner of immovable property located at 1031
Canal Street, New Orleans, Louisiana ("Project
Site") on which an abandoned building was located. 1031
Canal, as owner and general contractor, entered into a
subcontract with Hamp's obligating Hamp's to perform
demolition work at the Project Site. When demolition work was
being performed on May 28, 2015, a common wall between the
Project Site and a neighboring property, Rainbow Clothing
located at 1027 Canal Street ("Rainbow Building"),
partially collapsed, causing damage to the common wall and to
the Rainbow Building. The cause of the wall collapse is in
dispute. At the time that the collapse of the common wall
occurred, Hamp's had been paid all but $117, 040.00 of
the original contract price.On June 3, 2015, 1031 Canal sent a
"Notice of Breach of the Construction Contract and
Notice of Claim for Damages" to Hamp's.
1031 Canal refused to pay Hamp's the remaining balance
due under the contract, claiming that Hamp's was at fault
in the wall collapse, that 1031 Canal incurred damages as a
result and was thus entitled to setoff the damages by the
amount still owed under the contract. In light of 1031
Canal's failure to pay, Hamp's initiated this lawsuit
against 1031 Canal for the $117, 040.00 contract balance by
filing a Petition for Breach of Contract and Damages on
August 27, 2015. In response, on June 20, 2016, 1031 Canal
brought a reconventional demand against Hamp's and its
insurer, Gray Insurance, for 1031 Canal's alleged damages
associated with the wall collapse. 1031 Canal also filed
third-party demands against the project architect and the
project engineer that alleged each was also the cause of the
filed a motion for summary judgment on August 3, 2017,
requesting a judgment against 1031 Canal in the amount of
$117, 040.00, the balance due under the contract. In its
response, 1031 Canal pled the affirmative defense of
"setoff". The trial court granted the motion for
summary judgment and ordered judgment in favor of Hamp's
in the amount of $117, 040.00 plus judicial interest from the
date of demand but did not provide written reasons for its
appeal, 1031 Canal asserts that the trial court erred in
finding there was no genuine issue of material fact despite
the factual affidavit and exhibits submitted in opposition to
the motion for summary judgment and in failing to apply La.
C.C. art. 1901 to deny the motion for summary judgment in
light of 1031 Canal's reconventional demand based on
setoff and contractual default.
appellate court's review of a trial court's ruling on
summary judgment is de novo, using the same criteria
used by the trial court in deciding whether summary judgment
should be granted. Lewis v. Jazz Casino Co., L.L.C.,
2017-0935, p. 5 (La.App. 4 Cir. 4/26/18), 245 So.3d 68, 72,
writ denied, 2018-0757 (La. 9/21/18), 252 So.3d 877.
With limited exceptions not applicable in this case, the
summary judgment procedure is designed to secure the just,
speedy, and inexpensive determination of every action. La.
C.C.P. art. 966 A (2). "The procedure is favored and
shall be construed to accomplish these ends."
Id. A summary judgment shall be granted if the
pleadings, memoranda, depositions, answers to
interrogatories, and admissions on file, together with the
affidavits, if any, show that there is no genuine issue as to
material fact, and that the mover is entitled to judgment as
a matter of law. La. C.C.P. art. 966 A (3) and (4). Factual
inferences reasonably drawn from the evidence must be
construed in favor of the party opposing the motion, and all
doubts must be resolved in the opponent's favor.
Fiveash v. Pat O'Brien's Bar, Inc.,
2015-1230, p. 7 (La.App. 4 Cir. 9/14/16), 201 So.3d 912, 917.
In determining whether an issue is genuine, courts cannot
consider the merits, make credibility determinations,
evaluate testimony, or weigh evidence. Id.
burden of proof on a motion for summary judgment rests with
the mover. La. C.C. P. art. 966 D (1). However, if the mover
will not bear the burden of proof at trial on the matter that
is before the court on the motion for summary judgment, the
mover's burden on the motion requires him only to point
out to the court that there is an absence of factual support
for one or more elements essential to the adverse party's
claim, action, or defense. La. C.C.P. art. 966 D (1).
Thereafter, if the adverse party fails to produce factual
support sufficient to establish that he will be able to
satisfy his evidentiary burden of proof at trial, there is no
genuine issue of material fact.
Hamp's clearly set forth that it was owed a balance under
the subcontract, the burden shifts to 1031 Canal at trial and
in a summary judgment to prove the affirmative defense of
setoff. La. C.C.P. art. 966 D (1). An affirmative defense is
a defense that "raises a new matter, which assuming the
allegations in the petition are true, constitutes a defense
to the action." Bates v. City of New Orleans,
2013-1153, 2013-1587, p. 10 (La.App. 4 Cir. 3/26/14), 137
So.3d 774, 782. See also Buck's Run Enterprises, Inc.
v. Mapp Const., Inc., 1999-3054, p. 4 (La.App. 1 Cir.
2/16/01), 808 So.2d 428, 431 (holding that "[a] party
claiming setoff as an affirmative defense has the burden of
proving his claim."). Thus, 1031 Canal bears the burden
of proof to establish a genuine issue of material fact such
that Hamp's is not entitled to judgment as a matter of
based its entitlement to summary judgment on the fact that
1031 Canal could not establish it was due
liquidated damages as a matter of law pursuant to La.
C.C. art. 1893. Hamp's also claimed that the parties
expressly excluded setoff for any claims the ...