Holzenthal v. Sewerage & Water Bd. of N.O.
| Citation | 950 So.2d 55 |
| Decision Date | 10 January 2007 |
| Docket Number | No. 2006-CA-0797.,No. 2006-CA-0798.,No. 2006-CA-0796.,2006-CA-0796.,2006-CA-0797.,2006-CA-0798. |
| Parties | Rita H. Holzenthal Wife of/and Henry HOLZENTHAL, III, Gretel Holzenthal, Cecelia M. Holzenthal Wife of/and Henry W. Holzenthal, Patricia A. Stanley Wife of/and George E. Thomas, and Monica S. Espinel Wife of/and Luis F. Espinel v. SEWERAGE & WATER BOARD OF NEW ORLEANS. Carlo R. Galan, M.D., Gwendolyn D. Redus, Billye B. Ber and Maxine Miller v. Sewerage & Water Board of New Orleans. Jean Feran Wife of/and Fred Feran, Mary Susan Hunt, Mary Sharett Wife of/and Freddie Sharett, Penelope Sheffield, Elise A. Boyer and Cheryl L. Squire v. Sewerage & Water Board of New Orleans. |
| Court | Court of Appeal of Louisiana (US) |
Stephen B. Murray, Jr., Murray Law Firm, New Orleans, LA, Linda S. Harang, Law Offices of Linda S. Harang, L.L.C., Jefferson, LA, for Plaintiffs/Appellees.
James B. Irwin, David W. O'Quinn, Irwin Fritchie Urquhart & Moore LLC, New Orleans, LA, for Sewerage and Water Board of New Orleans.
Harry J. "Skip" Phillips, Jr., Margaret L. Tooke, Taylor, Porter, Brooks & Phillips, L.L.P., Baton Rouge, LA, for Fidelity & Guaranty Insurance Company.
Betty F. Mullin, Herman C. Hoffmann, Jr., Simon Peragine Smith & Redfearn L.L.P., New Orleans, LA, for James Construction Group, L.L.C.
Terrence L. Brennan, Keith J. Bergeron, Deutsch, Kerrigan & Stiles, L.L.P., New Orleans, LA, for Schrenk & Peterson Consulting Engineers, Inc. and Security Insurance Company of Hartford.
Joseph G. Gallagher, Jr., Hulse & Wanek, New Orleans, LA, David J. Bourgeois, Duplass Zwain Bourgeois Morton Pfister & Weinstock, Metairie, LA, for Brown, Cunningham & Gannuch, Inc.
Court composed of Chief Judge JOAN BERNARD ARMSTRONG, Judge MICHAEL E. KIRBY and Judge MAX N. TOBIAS JR.
This case involves three groups of homeowners who claim that their homes were damaged during the course of construction of the Southeast Louisiana Urban Drainage Project ("Project"). The purpose of the Project was to increase substantially drainage capacity in portions of New Orleans. The Project included, among other works, the construction of a box culvert underground drainage canal located in the median of Napoleon Avenue in New Orleans. It is uncontested that the project was controlled by the United States Army Corps of Engineers (ACOE), which funded 75% of its cost. The New Orleans Sewerage and Water Board (SWB) was the local sponsor of the Project and funded the remaining 25% of its cost.
The plaintiff homeowners sued SWB, and SWB filed third party actions against Schrenk & Peterson Consulting Engineers, Inc. (S & P), its insurer, Security Insurance Company of Hartford (Security), Fidelity & Guaranty Insurance Company (Fidelity), insurer of SWB's engineering consultant, Brown, Cunningham and Ganuch, Inc. (Brown) and James Construction Group, L.L.C. (James). SWB claimed that S & P was contractually required to defend, indemnify and hold harmless SWB from claims arising from the Project to the extent that such claims were caused by S & P's negligent acts, errors or omissions in the performance of professional services pursuant to SWB's contract with S & P. SWB claimed that James' tortious conduct or violation of provisions of its contract with ACOE caused the homeowners' damages. SWB claimed that Fidelity, as insurer of its consulting engineer, owed it a duty to defend the homeowners' suits and owed it coverage as an additional insured under Fidelity's policy with the engineering firm. The plaintiffs sued only SWB, and made no claims against the contractors or their insurers. SWB's claims against its own insurers were severed, and the remaining claims proceeded to a bench trial.
At the conclusion of the presentation of SWB's case, the trial court granted motions for involuntary dismissal made by S & P and its insurer, Security; by Fidelity and by James.
On March 10, 2005, the trial court granted judgment denying SWB's Motion for New Trial of the trial court's ruling granting a motion to dismiss at the close of SWB's evidence in favor of Brown and Continental Casualty Company.
On March 10, 2006, the trial court granted judgment denying SWB's Motion for New Trial of the trial court's ruling granting a motion to dismiss at the close of SWB's evidence in favor of S & P and Security.
On March 10, 2006, the trial court granted judgment denying SWB's Motion for New Trial of the trial court's ruling granting a motion to dismiss at the close of SWB's evidence in favor of James.
On March 10, 2006, the trial court granted judgment denying SWB's Motion for New Trial of the trial court's ruling granting a motion to dismiss at the close of SWB's evidence in favor of Fidelity. The trial court correctly noted in its reasons for judgment that the disposition of the foregoing third-party claims has no bearing on the grounds for liability asserted by the plaintiffs against SWB.
On July 20, 2005, the trial court rendered judgment in favor of the plaintiff homeowners as follows:
In favor of Rita and Henry Holzenthal, III and against SWB in the amounts of $379,805.06 for property damage; $15,825 for moving and storage costs, and $15,000 for emotional distress, plus court costs and interest from the date of judicial demand;
In favor of Carlo R. Galan, M.D. and against SWB in the amounts of $330,983.14 for property damage; $12,500 for moving and storage costs, $25,000 for emotional distress and $13,870 for personal property damage, plus court costs and interest from the date of judicial demand; and
In favor of Jean and Fred Feran and against SWB in the amounts of $246,936.10 for property damage, $18,650 for moving and storage expenses, $2,435 for out of pocket repair cost, $25,000 for emotional distress and $6,500 for damages to personal property, plus court costs and interest from the date of judicial demand.
SWB appeals from the foregoing judgments in favor of the plaintiffs and denying its motions for new trial of the trial court's directed verdicts on SWB's third party demands. For the reasons that follow, we affirm the aforementioned judgments.
The trial court adopted extensive findings of fact and reasons for judgment. In the mid- to late-1990s, SWB began to discuss plans for improving drainage in the Broadmoor neighborhood, where the plaintiffs' homes were located. The primary feature of this project would be installation of a large underground box culvert under the Napoleon Avenue median to be part of the larger ACOE/SWB Project to improve drainage in Southeast Louisiana.
On January 22, 1996, following a joint feasibility study by ACOE and SWB, those parties entered into a Project Cooperation Agreement for the construction of the box culvert. SWB then entered into various service agreements with contractors to assist SWB in fulfilling its responsibilities under the agreement with ACOE.
The Napoleon Avenue project consisted of two phases: (1) work primarily at the "Y" intersection of Fontainebleu Drive, South Broad Street and Napoleon Avenue, and a short distance along the Avenue median to a point just north of South Dorgenois Street, and (2) work from the south end of Phase 1 along Napoleon Avenue's median to a point just north of South Claiborne Avenue. The Feran plaintiffs and Dr. Galan own and reside in homes fronting on Napoleon Avenue, and the Holzenthal plaintiffs lived within one block of the "Y" intersection at the north end of Napoleon Avenue.
Dewatering in connection with Phase 1 began in May, 2000 and continued until March, 2001. Phase 1 driving of steel sheet piles and timber piles began several months prior to dewatering. Phase 2 pile driving began in Spring of 2001 and Phase 2 dewatering began in July, 2001.
The plaintiffs claim that their homes were damaged as a result of the Napoleon Avenue drainage construction project, having suffered significant settlement and/or vibration damage as a result of the effects of dewatering, steel sheet pile driving, timber pile driving and movement of heavy equipment including cranes, pile driving hammers, excavation equipment, trucks, tractors and other heavy machinery. The sheet pile driving was accomplished using ordinary pile driving cranes and vibratory hammers to drive the steel sheet piles to a depth of between 25 and 30 feet below the surface, and then later using the same equipment to remove the steel sheet piles. The timber pile driving work was accomplished using ordinary pile driving equipment to drive timber piles to a depth of more than 35 feet below the bottom of the excavated site in order to support the poured concrete box culvert.
The trial court concluded that SWB is liable to each of the plaintiffs for the full costs of repair to their homes caused by the Project, together with the full cost of repair or replacement of their damaged personal property and reasonable damages for the emotional distress each suffered as a result of the Project.
The gravamen of the liability case is that the damages sustained by the plaintiffs were the necessary consequence of the Project, and that the Project was undertaken for a valid public purpose. An additional ground for liability is found in the ultrahazardous pile-driving activity that causally contributed to the plaintiffs' damages. The plaintiffs do not allege that any of the contractors on the Project deviated from accepted practice or from the Project's plans and specifications.
The trial court noted that underlying all of SWB's arguments with respect to liability is its repeated assertion, made likewise on appeal, that the Project is not SWB's project because the construction was directly supervised by entities other than SWB. It asserts it was merely a "local sponsor" of the Project and that it contracted away to third parties any responsibility it otherwise would have had for damages caused by the Project. The trial court rejected this basic argument, finding that as a matter of law, SWB could not and did not...
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