Sewerage and Water Bd. of New Orleans v. Sanders, 4614

• Decision Date: 20 June 1972
• Docket Number: No. 4614,4614
• Citation: 264 So.2d 270
• Parties: SEWERAGE AND WATER BOARD OF NEW ORLEANS v. Jack SANDERS, d/b/a Laguna Construction Company, et al.
• Court: Court of Appeal of Louisiana — District of US

Page 270

264 So.2d 270

SEWERAGE AND WATER BOARD OF NEW ORLEANS v. Jack SANDERS, d/b/a Laguna Construction Company, et al.

No. 4614.

Court of Appeal of Louisiana, Fourth Circuit.

June 20, 1972.

Writ Refused Sept. 27, 1972.

Jones, Walker, Waechter, Poitevent, Carrere & Denegre, Ernest A. Carrere, Jr. and Robert M. Contois, Jr. and John A. Gordon, Special Counsel, New Orleans, for plaintiff-appellant.

Malcolm W. Monroe and Deutsch, Kerrigan & Stiles, New Orleans, Frederick B. Alexius, New Orleans, of counsel, for defendants-appellees.

Before SAMUEL, REDMANN and STOULIG, JJ.

STOULIG, Judge.

This is an appeal from a judgment maintaining an exception of prescription to the plaintiff's action sounding in maritime tort. Appellant urges that the trial court erred in applying the doctrine of prescription rather than the maritime doctrine of laches. Involved is the issue of whether Louisiana courts should apply the admiralty doctrine of laches or the law of prescription in determining whether a suit based upon a maritime tort has been timely instituted.

A brief resume of the facts pertinent to our discussion of the merits of this appeal reflects that on February 3, 1967, plaintiff-appellant, Sewerage and Water Board of New Orleans, entered into a written contract with the defendant, Jack Sanders, doing business as Laguna Construction Company, for the construction of sewerage facilities in New Orleans East. An appropriate performance bond was furnished and the contract duly recorded.

Various phases of the project were subcontracted and the defendant Great Lakes Dredge & Dock Company contracted with a subcontractor to dredge and backfill a pipeline trench across the Mississippi-Gulf Outlet.

Work under the contract commenced on March 14, 1967, but ceased on August 5, 1967, after a dispute between the plaintiff and the prime contractor. On October 25, 1967, by letter, a formal demand was made upon the prime contractor to repair a damaged sewer line and resume performance of the contract. Neither of these demands was met, which prompted plaintiff's letter of November 22, 1967, ordering the defendant to surrender possession of the project.

Several days later, on November 29, 1967, the plaintiff recorded the notice of default of the contract. Within 45 days of the inscription of the notice of default, Great Lakes filed its claim in the sum of $173,623.25.

Appellant filed a concursus proceeding pursuant to LSA-R.S. 38:2243 on February 28, 1969. Also forming part of the petition was the tort claim against the defendant Great Lakes alleging that it performed the work of backfilling the trench in an improper and unworkmanlike manner by failing to protect the sewer pipeline. It is this segment of the petition with which we are concerned on this appeal.

Various defenses were urged by Great Lakes by way of a rule, several exceptions, and a motion to strike. Its rule to dismiss the concursus proceedings, based on the fact it was instituted more than a year after recordation of the default, was denied by the trial court. Exception of no cause of action predicated upon plaintiff's failure to allege the specific facts or circumstances constituting improper or unworkmanlike performance was maintained, and the plaintiff's action seeking damages ex delicto was dismissed. Exceptions of no right of action and prescription, together with a motion to strike the tort claim as being outside of the scope of a concursus proceeding, were not passed upon.

The matter was then appealed to this court and that portion of the judgment dismissing the plaintiff's suit was reversed. The judgment maintaining the exception of no cause of action was amended so as to order the appellant to amend its petition to state with particularity in which factual respects the work was performed in an improper or unworkmanlike manner, and the matter was remanded to the trial court for this purpose (239 So.2d 414 (1970)). After writs were refused by the Supreme Court, 256 La. 912, 240 So.2d 374, the appellant on December 8, 1970, amended and supplemented its petition to set forth the defendant's specific acts of negligence.

Subsequently, on December 14, 1970, the trial court maintained the exception of prescription previously filed by the defendant on March 13, 1969, and which it had taken under advisement. It expressly reaffirmed the plaintiff's right to assert the prescribed obligation as a defense accorded by LSA-C.C.P. art. 424.

Plaintiff again appealed which the defendant moved to dismiss contending that the judgment of the trial court is interlocutory since the concursus proceeding is still pending coupled with the plaintiff's right to urge its prescribed claim as a defense. This motion has already been denied by this court (246 So.2d 734 (1971)).

No useful purpose would be served in particularizing the alleged negligence of Great Lakes. Suffice it to state that it was first urged in plaintiff's petition filed on February 28, 1969, and later pleaded with specificity in the supplemental petition of December 8, 1970. There is no serious dispute that the tort, as pleaded, is maritime in nature and that the Civil District Court has concurrent jurisdiction to entertain this action under the 'saving to suitors' clause of 28 U.S.C. § 1333.

The entire record consists of pleadings, responses, and preliminary proceedings. It reflects that the negligent conduct of the defendant Great Lakes set forth in the plaintiff's supplemental petition were overt acts. In view of the fact that all work ceased on the contract on August 5, 1967, of necessity, defendant's negligent actions must have occurred on, or prior to, this date. This action, including the tort claim against Great Lakes, was instituted some 18 months after the termination of all work and resulted in the filing of an exception pleading the prescription of one year, which was maintained by the trial court.

Posed for our consideration is whether the timeliness of plaintiff's suit is to be determined by the one-year prescription of LSA-C.C. art. 3536, applicable to offenses or quasi offenses, or by the admiralty doctrine of laches, which bars recovery when an inordinate delay in the filing of a suit under the circumstances of the case has prejudiced the defendant's ability to defend. In contrast to our doctrine of prescription, time alone is not the only element of laches, for also involved is the equitable consideration of consequential prejudice to the defendant occasioned by the delay.

Appellant maintains that this action being cognizable in admiralty the State is obliged to apply the maritime law of laches. In opposition thereto, appellee contends since the exception of prescription is procedural rather than substantive, that in accordance with the general principle of the conflict of laws, this procedural law of the forum governs. ¹ To properly adjudicate the merits of the respective contentions, it must first be determined if prescription and laches each is procedural or substantive in character.

Both state and federal courts have recognized that LSA-C.C. art. 3536, which provides that actions for offenses and quasi offenses prescribe in one year, is procedural rather than substantive. This conclusion is predicated on the fact that Article 3536 bars the remedy but does not extinguish the right. In other words, the one-year period is the delay during which the enforcement of a tort action must be filed and the failure to do so leaves the remedy vulnerable to an exception of prescription. The prescriptive period is not a statutory peremption which extinguishes the cause of action if not exercised within the time prescribed in the codal article. Fidelity & Casualty Company of New York v. C/B Mr. Kim, 345 F.2d 45 (5th Cir. 1965); Page v. Cameron Iron Works, Inc., 259 F.2d 420 (5th Cir. 1958); Succession of Pizzillo, 223 La. 328, 65 So.2d 783 (1953); Succession of Aurianne, 219 La. 701, 53 So.2d 901 (1951); Carpenter v. Cox, 186 So. 863 (La.App.2d Cir. 1939).

The federal courts have consistently treated the doctrine of laches as a substantive right and have insisted that its application by the state courts is essential to insure uniformity in the judicial administration of maritime law. They maintain in effect that to substitute in...