Burdette v. Drushell

• Decision Date: 20 December 2002
• Docket Number: No. 2001 CA 2494.,2001 CA 2494.
• Citation: 837 So.2d 54
• Parties: Stephen Ray BURDETTE v. Ron DRUSHELL.
• Court: Court of Appeal of Louisiana — District of US

837 So.2d 54

Stephen Ray BURDETTE v. Ron DRUSHELL.

No. 2001 CA 2494.

Court of Appeal of Louisiana, First Circuit.

December 20, 2002.

Rehearing Denied February 3, 2003.

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Michael L. Hyman, Baton Rouge, Counsel for Defendant/Appellant Ron Drushell.

James S. Holliday, Jr., Baton Rouge, Counsel for Plaintiff/Appellee Stephen Ray Burdette.

Before: KUHN, DOWNING and GAIDRY, JJ.

GAIDRY, J.

This civil action arises from an oral contract for the completion of construction and renovation of a residence. The defendant, Ron Drushel¹, has appealed a money judgment for the balance of labor and materials alleged to be owed by him to the plaintiff, Stephen Ray Burdette, together with awards for attorney's fees and damages. Defendant also appeals that portion of the judgment recognizing a privilege against his property under the Louisiana Private Works Act.² For the reasons set forth below, the trial court's judgment is reversed in part, amended in part, and, as amended, affirmed in part.

I. FACTUAL AND PROCEDURAL BACKGROUND

On March 13, 1994, Mr. Drushel made the decision to purchase property which included an unfinished "camp." Two days later, on March 15, Mr. Drushel arranged for Mr. Burdette, a friend and carpenter, to informally inspect the building and to share his thoughts on costs of completion. Mr. Burdette agreed with another estimate that the building could be completed for approximately $35,000.00. Several weeks later, Mr. Drushel contacted Mr. Burdette and proposed that he undertake the completion of the camp. The parties met on or about June 7, 1994, and entered into an oral agreement to that effect. It is undisputed that no fixed price for labor and materials was agreed upon, and that the terms of the agreement provided that plaintiff would perform the job on a "costs plus" basis. The contract was never reduced to writing, and the scope of work was never clearly defined.

After plaintiff commenced work on the renovation and refurbishing project, defendant requested numerous significant changes to work phases completed or in progress, and insisted upon the use of premium materials (such as red oak for the interior woodwork), requiring an added level of craftsmanship. During the course of construction, plaintiff submitted, and defendant paid without protest, two interim invoices totalling $62,519.00.

After the work had proceeded for about five months, defendant became dissatisfied with the progress towards completion of the camp, and terminated the contract in late November of 1994. Plaintiff did not file for record a written notice of contract prior to beginning the work.

This litigation commenced with the filing of plaintiffs petition, styled as a "Suit to Enforce Lien." Plaintiff alleged that he performed labor and furnished materials necessary for the work on the camp, that the amount of $48,864.21 due had not been paid, and that he had filed and served a "Labor and Materialmen's Lien [notice] and Statement of Claim" relating to the subject property. Plaintiff accordingly claimed a privilege against the property for the contractual amount due, as well as a money judgment for that amount, damages, legal interest from the date of judicial demand, costs, and a reasonable attorney's fee.

Defendant answered, generally denying liability. Later, in a supplemental and amended answer, he raised the defense that plaintiff did not properly perfect the privilege. Defendant also alleged that plaintiff overcharged him, and that he was entitled to reimbursement for all amounts paid in excess of reasonable charges for the work done, as well as additional incurred expenses required to complete the work on the camp.³

Following a protracted discovery dispute relating to a request to inspect the premises, this matter was set for bench trial on June 13-15, 2000.

Following the trial, the trial court took the case under advisement for decision. On November 14, 2000, the trial court issued its written reasons for judgment, finding that plaintiff was entitled to recovery of the full sum of 544,365.94 claimed as of the time of trial, recognition of the privilege claimed in that amount, attorney's fees of $2,500.00, and damages of $5,000.00. However, the trial court expressly denied the prior motion for contempt referred to the merits. On January 3, 2001, the trial court signed the judgment prepared by plaintiff's counsel at its direction. From that judgment, defendant appeals.

II. THE ISSUES ON APPEAL

Defendant contends the trial court erred (1) in finding that plaintiff met his burden of proof as to the sum awarded; (2) by admitting third-party invoices into evidence without testimony from the third parties; (3) by considering expert testimony from plaintiff's expert witness; (4) in awarding duplicative damages; and (5) in awarding attorney's fees.

III. STANDARD OF REVIEW

As an appellate court, we cannot set aside the trial court's factual findings unless we determine there is no reasonable factual basis for the findings and the findings are clearly wrong. Stobart v. State, through Department of Transportation and Development, 617 So.2d 880, 882 (La. 1993). Thus, if the findings are reasonable in light of the record reviewed in its entirety, this court may not reverse even though convinced that had it been sitting as the trier of fact, it would have weighed the evidence differently. Rosell v. ESCO, 549 So.2d 840, 844 (La.1989). However, where one or more trial court legal errors interdict the fact-finding process, the "manifest error" or "clearly wrong" standard is no longer applicable, and, if the record is otherwise complete, the appellate court should make its own independent de novo review of the record and determine a preponderance of the evidence. Ferrell v. Fireman's Fund Insurance Company, 94-1252, pp. 6-7 (La.2/20/95), 650 So.2d 742, 746-47.

IV. RECOVERY UNDER THE COSTS PLUS CONTRACT

A. DISCUSSION

The contract involved here was a "costs plus" contract. A "costs plus" (costs plus percentage of costs) contract, or a "percentage" contract, is a construction contract in which the owner agrees to reimburse the contractor for the costs of material and labor and to pay a percentage of those costs as his profit. Schiro-Del Bianco Enterprises, Inc. v. NSL, Inc., 99-1237, p. 4 (La.App. 4th Cir.5/24/00), 765 So.2d 1087, 1089-90, writ denied, 2000-2509 (La.11/13/00), 774 So.2d 146.

When a contractor asserts a claim on a "costs plus" contract and the owner denies being indebted to the contractor, the contractor has the burden of proving each item of expense in connection with the job and he must itemize each expenditure made by him. American Plumbing Company, Inc. v. Hadwin, 483 So.2d 169, 172-73 (La.App. 2nd Cir.1986).

In support of the balance claimed, plaintiff introduced his final statement for services previously submitted to defendant, in the original amount of $48,864.21, as well as copies of his labor time records, materials invoices, and, over defendant's objection, the labor and materials invoices of other contractors (referred to for convenience herein as subcontractors) supporting that amount. The final statement contains an item of $18,563.87, designated as "overhead and profit," representing 20% of the total claimed. Plaintiff called defendant as an adverse witness, and in connection with that examination introduced as his own exhibit a videotape taken by defendant on November 24, 1994, depicting the state of the premises then and defendant's narration regarding the work performed. Plaintiff also called as witnesses one of his own carpenters and two of the subcontractors he engaged for the project.

Defendant testified on his own behalf regarding the work done by plaintiff and various alleged deficiencies, and also called Brenda Bourgeois, his girlfriend, to corroborate his testimony in that regard. Additionally, defendant called plaintiff as an adverse witness under cross-examination.

In addition to their own testimony and that of supporting witnesses, the parties presented the testimony of their respective expert witnesses, both of whom testified in detail regarding their analysis of the nature of the work, the type of residence being constructed, the labor and materials documented, and the correlation between the labor and materials charged and the ultimate product.

With the exceptions described herein, we agree with the trial court's finding that plaintiff met his burden of properly itemizing the costs making up the price of his work through his testimony and that of his witnesses, together with the documentary evidence.

B. THE AMOUNT OF THE OBLIGATION

Plaintiff initially sought recovery of the principal amount of $48,864.21, representing the unpaid balance of labor and material charges for plaintiffs work, as well as that of the subcontractors whose services he procured. The evidence demonstrated, and plaintiff acknowledged at trial, that defendant paid the invoice of Appliance Distributors for kitchen appliances installed in the camp, and was entitled to a credit, plaintiff claiming a revised balance of $44,365.94. This is the principal amount ultimately awarded. At trial, through the testimony of his expert, Mr. Clary, plaintiff conceded that the balance should also have been reduced by the overhead and profit margin of 20% added to Appliance Distributors' invoice. The invoice in the record is in the amount of $4,172.04. Thus, the trial court erred in failing to credit that amount, and the judgment must accordingly be reduced by $834.41.

(1) ADMISSION OF THIRD-PARTY INVOICES

Defendant contends that the trial court erred in allowing the introduction of third-party invoices into evidence, since they constituted inadmissible hearsay. Plaintiff counters that the records constitute part of his own "business records" and therefore fall within the corresponding exception to the general rule against hearsay evidence.

La. C.E. art. 803(6) sets...