Allstate Enterprises, Inc. v. Brown

• Decision Date: 29 June 2005
• Docket Number: No. 39,467-CA.,39,467-CA.
• Citation: 907 So.2d 904
• Parties: ALLSTATE ENTERPRISES, INC., Plaintiff-Appellant v. Greg BROWN and Denise Brown, Defendants-Appellants.
• Court: Louisiana Supreme Court

907 So.2d 904

ALLSTATE ENTERPRISES, INC., Plaintiff-Appellant v. Greg BROWN and Denise Brown, Defendants-Appellants.

No. 39,467-CA.

Court of Appeal of Louisiana, Second Circuit.

June 29, 2005.

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Kenneth L. Harper, for Allstate Enterprises, Inc.

C. Bryan Racer, Monroe, for Greg Brown and Denise Brown.

Before CARAWAY, BROWN and STEWART, JJ.

CARAWAY, J.

This is a dispute between homeowners, who directed the construction of their home based on plans obtained from the internet, and the framing contractor which they hired. The contractor filed a lien for the balance owed on the parties' contract and the homeowners reconvened for damages related to the contractor's alleged substandard work. The trial court ruled in favor of the homeowners regarding the defective work, awarded damages in excess of the total contract price, and denied the contractor's claim of offset for the unpaid balance. Finding that the trial court erred in its failure to apply the doctrine of substantial performance of the contract, we reverse the ruling to allow the offset and to adjust the excessive award for damages to the homeowners.

Facts

Greg and Denise Brown obtained the services of Allstate Enterprises, Inc. ("Allstate") to furnish labor for a portion of the construction of a new home. Allstate first sued the Browns for $10,552.00, the unpaid balance on the contract, and the Browns reconvened for alleged damages resulting from Allstate's substandard workmanship.

After obtaining architectural plans for the home off the internet, Mr. Brown contacted Bill Thompson at Allstate to frame the foundation, pour the slab and frame up the house. The framing work included the roof, outside doors, windows, all walls and stairs. Brown testified that he "subcontracted" with other contractors, including electricians, plumbers, and a sheet rock subcontractor. Brown did some of the finishing work like interior painting.

The Browns' house design, Chatham Plan No. 4254-A-1, called for construction of an elaborate two-story, five-bedroom and three-bath stucco house with 4249 square feet of living area, 802 square feet of porches and an 816 square foot detached garage. The plans called for ten-foot ceilings on the first floor and nine foot ceilings on the second floor, along with an upstairs balcony traversing the family and dining room areas. The first floor architectural details included numerous archways and columns.

With regard to care and accuracy of these architectural designs, the plans expressed the following limitations:

Great care and effort have gone into the creation of the design of these plans. However, because of the impossibility of providing any personal and/or "on-the-site" consultation and supervision over the actual construction, and because of the great variance in local building code requirements, and other local building and weather conditions, designer assumes no responsibility for any damages, including structural failures, due to any deficiencies, omissions or errors in the design, blueprints, or specifications.

Thompson studied the plans and prepared the following proposal which was accepted by the Browns:

We hereby submit specifications and estimates for: House approximately 4691 sq. ft. on slab. Second story contains 1236 sq. ft. Total of 5927 sq. ft. Form, set, & dig footings install rods, wire, Visqueen Framing to include Studwalls, ceiling joists, rafters, decking, felt, cornice (soffit), set outside doors and windows. Cornice not to include crown mold per owners instructions and front doors square fit. Outside of Home to be vinyl siding instead of stucco. Slab normal one foot above ground.

Bid Exclusions: No materials, electrical, plumbing, A/C & Htg

Raised Slab of 30 inches above ground will be cost plus 8% Approximately $2,605.83 for the slab. Total approx. $39,742.24

We propose hereby to furnish labor only — complete in accordance with the above specifications for the sum of $37,136.41 with payments to be made as follows: 4 payments: 1^st¼ 2^nd¼ 3^rd¼ 4^th¼

Greg Brown arranged to furnish all construction lumber and materials using a list based on the plans prepared by Tom Sanders, a lumber supplier. Although Sanders compiled the list, Brown shopped it with others and ultimately contracted for building materials with Russell Moore. Moore delivered the construction materials to the site as needed, based on Sanders' list.

The Browns alleged that Allstate's work on the house deviated from the plans and constituted substandard workmanship in numerous areas. The house foundation was apparently overshot by 3". This led to the dormers, windows, doors and dining room chandelier being off center. Allstate's carpenter, Randy Dodson, admitted that he missed 1½" on each end of the form when he set it, which caused the front porch to be 3" short. To remedy this situation, Thompson suggested a 3" double-studded wall on the left hand side of the interior of the house. Denise Brown authorized construction of the double wall. Dodson testified that alternatively, a concrete saw could have been used to remove the excess 3" from the foundation.

The height of the upstairs exterior walls deviated from the plans. The highest exterior second floor wall measures 41" high, which makes use of the upstairs walk-in closets difficult. The plans called for the walls to be no less than 66" high. The deviation was apparently attributable to either a design defect in the plans, a discrepancy in the pitch of the roof, or simply the location of the walls in the upstairs rooms. Brown's construction expert, John Maroney, testified that the problem with the short upstairs walls occurred because Thompson did not draw framing plans prior to starting construction.

The house plans called for 2×8 rafters for the roof. Tom Sander's list called for 2×6 rafters, and Moore delivered 2×6 rafters for use in the house construction. In Thompson's opinion, 2×6's were adequate if they were supported properly and braced off. Dodson testified that "just about every house you build is going to have 2×6 rafters." Maroney testified that although the roof of the house sagged, and the 2×8 rafters would have been stronger, he could not specifically attribute the sagging problem to the difference between the size of the rafters.

Greg Brown testified that after they started hanging sheetrock, he noticed the center dormer was 9" off center to the left, and the dining room chandelier was also off center. The plumber told Brown that the foundation was poured 3" off. Brown stated that "it throwed the whole front of the house off." The dining room chandelier was moved over 9" from the center of the room to improve aesthetics.

The garage floor elevation was lower than the house foundation. Brown testified that rainwater runs through the garage and out the garage door. Although Brown hauled some fill dirt in, he said Thompson was supposed to have formed it, backfilled it and reshot the grade before pouring the concrete. Thompson testified that there was a separate contract between Allstate and Brown to fill the foundation in with dirt after it was framed. However, when Thompson started the job late, Brown told him to go ahead, that the pad was ready and the dirt work had been finished. Maroney testified that the garage elevation should have been about one foot higher. Also, the concrete in the breezeway between the garage and the house was cracked. Brown asserted that this problem was due to the lack of expansion joints, as called for in the plans.

The living room columns and archways were not finished properly according to Brown. Thompson testified that he worked on the columns himself and that they were straight.

The height of the living room staircase risers varied, and the garage staircase steps were too steep and too narrow. When Thompson and Dodson laid out the garage steps according to the plans, they advised Brown that the stairs were not wide enough to properly accommodate one's foot and recommended 1½" be added to each step. In order to obtain these wider steps, they advised Brown to add a turn of the staircase into the garage. After discussing the problem, Brown told them to make the steps straight according to the plans. Brown testified that he didn't notice the problems with the stairs until the finishing work began.

Maroney estimated, among other items, that it would cost $6,000 to repair the two staircases, $500 to repair the walls in the master bedroom, $1,000 to fix a closet which was out of square and $60,000 to remove and raise the roof to remedy the wall height problem in the second story. The balance owed Allstate under this contract was $10,552.41.

Following a bench trial reviewing all the above matters, the trial court issued written reasons for judgment, specifically ruling that "this house was built below the standard of reasonable workmanship in too many particulars to name within this ruling." This initial ruling went on to recognize an unspecified amount of damages "not to exceed the cost of making comprehensive repairs. . . ." Despite evidence of the Browns' damages presented at trial, the Browns were nevertheless invited "to file a Rule to establish and/or set the amount reasonably necessary to make the comprehensive repairs in question." After initial appeals of this partial and incomplete judgment by the trial court, this court remanded the case. Without any further evidentiary hearing, the trial court then rendered a money judgment in favor of the Browns. The court's written reasons concerning quantum were expressed as follows:

Pursuant to this Court's initial ruling and the directives of the 2nd Circuit, and considering this Court's Order dated 4 November 2004, and considering the offering made pursuant to same, damages are awarded to the prevailing party in the amount of $55,000.00 as reasonable cost of repair in order to address the many problems...