Smith v. H.J. Landreneau Bldg. Contractor, Inc.

• Decision Date: 03 February 1983
• Docket Number: No. 82-373,82-373
• Citation: 426 So.2d 1360
• Parties: Jimmy Allen SMITH, et al., Plaintiffs-Appellants, v. H.J. LANDRENEAU BUILDING CONTRACTOR, INC., Defendant-Appellee.
• Court: Court of Appeal of Louisiana — District of US

Page 1360

426 So.2d 1360

Jimmy Allen SMITH, et al., Plaintiffs-Appellants, v. H.J. LANDRENEAU BUILDING CONTRACTOR, INC., Defendant-Appellee.

No. 82-373.

Court of Appeal of Louisiana Third Circuit.

Feb. 3, 1983.

Pucheu, Pucheu & Pucheu, Jacque B. Pucheu, Eunice, for plaintiffs-appellants.

George Privat, Lafayette, for defendant-appellee.

Before GUIDRY, CUTRER and LABORDE, JJ.

GUIDRY, Judge.

In this action, the purchasers of certain real property seek reduction of the purchase price, damages and attorney's fees from the vendor-builder for an alleged redhibitory defect, i.e., susceptibility of the premises to flooding. The vendor-builder filed a peremptory exception of prescription. After trial on the merits, the trial judge rendered judgment sustaining defendant's exception of prescription and dismissed plaintiffs' suit. Plaintiffs appeal.

The primary issue is whether the trial judge erred in sustaining the defendant's exception of prescription. If this question is resolved in the affirmative, we must then determine whether the plaintiffs have proved their case and the extent of the award, if any.

The defendant, H.J. Landreneau Building Contractor, Inc. (hereafter Landreneau) is a land developer and contractor, who buys property, constructs homes thereon, and then resells the improved property. On October 29, 1976, Landreneau bought a lot of ground located in the Suzanne Guillory Addition "B" to the City of Eunice, Louisiana. Landreneau completed construction of a house on this property sometime prior to March or April of 1977. This is the house and lot ultimately sold to plaintiffs. In May of 1977, this property and an adjacent lot, also owned by Landreneau, flooded. Water entered the house on the adjacent lot which is situated about 170 feet from the bank of a coulee but not the house on the lot in question which is situated about 225 feet from the coulee. Landreneau had the property listed with a realtor for six months but was unable to find a purchaser.

Judy Arnaud Smith, one of the plaintiffs, her mother and her sister worked at the Pelican Restaurant where Howard Landreneau, the defendant's president, went twice a day to drink coffee. They had known each other for many years. In late October, 1977, Mrs. Smith advised Howard Landreneau that she and her husband, Jimmy Smith, were interested in purchasing the property. Subsequently, Mrs. Smith was informed by her stepfather that he had seen some carpeting drying in the yard of the adjacent lot after the property had flooded in March or April of 1977. Mrs. Smith, her mother and her sister discussed this matter and the property in general on several occasions with Mr. Landreneau at the Pelican Restaurant. The substance of Mr. Landreneau's response to Mrs. Smith's inquiries about flooding was that the house (as opposed to the lot) had not flooded in the past and would not flood in the future because the coulee had been cleaned out. On November 7, 1977, Landreneau sold the property to the Smiths for the sum of $48,500.00. On May 30, 1979, the property flooded. Sixteen inches of water entered the home causing extensive damage. This suit was filed on May 9, 1980. The property flooded again in April of 1980.

Defendant pled the prescription of one year to the redhibitory action. Articles of our Civil Code pertinent to the issue presented provide as follows:

"Art. 2534. Prescription of redhibitory action; exception and suspension. The redhibitory action must be instituted within a year, at the farthest, commencing from the date of the sale.

This limitation does not apply where the seller had knowledge of the vice and neglected to declare it to the purchaser.

Nor where the seller, not being domiciliated in the State, shall have absented himself before the expiration of the year following the sale; in which case the prescription remains suspended during his absence.

C.C. arts. 1832, 2498, 2520, 2535 et seq., 2545, 2546.

(Emphasis ours)

Art. 2545. Liability of seller for concealment of vice. The seller, who knows the vice of the thing he sells and omits to declare it, besides the restitution of price and repayment of the expenses, including reasonable attorneys' fees, is answerable to the buyer in damages. (Amended by Acts 1968, No. 84, § 1.)

C.C. arts. 1763, 1832, 1847, 1934 et seq., 2506 et seq., 2521, 2531, 2534 et seq., 2544, 2546, 2547, 2551.

LSA-R.S. 51:1401 to 51:1418.

(Emphasis ours)

Art. 2546. Prescription of redhibitory action when seller in bad faith. In this case, the action for redhibition may be commenced at any time, provided a year has not elapsed since the discovery of the vice.

This discovery is not to be presumed; it must be proved by the seller.

C.C. arts. 2498, 2534, 2545."

Also pertinent is Civil Code Article 2522 which provides:

"Art. 2522. Latent defects made known to buyer. The buyer can not institute the redhibitory action, on account of the latent defects which the seller has declared to him before or at the time of the sale. Testimonial proof of this declaration may be received.

C.C. arts. 2276, 2277, 2503, 2521."

These provisions contemplate three distinct situations. Under Article 2534, if the seller has no knowledge of the latent defect, the buyer's action in redhibition prescribes in one year from the date of the sale. Under Articles 2545 and 2546 and stated as an exception to Article 2534, if the seller has knowledge of the latent defect but omits to declare it, the buyer's action in redhibition prescribes in one year from the discovery of the vice. Under Article 2522, if the seller has knowledge of the latent defect and declares it to the buyer, there is no prescriptive period because the buyer has no cause of action in redhibition.

The Smiths instituted this suit in redhibition more than one year after the sale of the dwelling. Therefore, proof of the seller's knowledge of the vice and his neglect in declaring it to the buyers is essential if this action is to be maintained. If the buyer succeeds in this proof, it is then up to the seller to show that more than one year had elapsed since their discovery of the vice. The trial judge sustained the one year prescription under Article 2534. In his written reasons for judgment, he recognized that under our jurisprudence the builder or the manufacturer is presumed to know of the vice in the article he constructs or manufactures. He, nonetheless, stated:

"The extended prescription arising from a seller's failure to disclose a defect suggests a penal element. Such a result should be based on actuality, that is, what the seller actually knew, not what he is presumed to have known."

This conclusion is contrary to the law and the jurisprudence of this state. The Supreme Court addressed this same issue in Tuminello v. Mawby, 220 La. 733, 57 So.2d 666 (1952) and stated 57 So.2d at page 667:

".... Since one year elapsed, for this action to be maintained proof of the knowledge of the vice on the part of the seller is essential. In both Article 2534 and Article 2545 significance is given to the fact of knowledge of the seller. Under Article 2534 the limitation is not applicable 'where the seller had knowledge of the vice and neglected to declare it to the purchaser', and under Article 2545 the seller is answerable in damages when he 'knows the vice of the thing he sells and omits to declare it'. The rules for proving this knowledge would be the same under both articles.

Under the French law as well as under the jurisprudence of this state the artisan, craftsman, builder, or manufacturer is presumed to know of the vice or defect in the article he constructs, manufactures, or builds.

(discussion of authorities omitted)

Under these authorities, we hold in the instant case that the vendors of the brick dwelling were presumed to have had knowledge of the vice of the dwelling or residence sold, since it was built and constructed by the defendant contractor, Mawby. Since, under this conclusion, the vendors had knowledge of the vice in the thing sold and since they failed to declare it to the purchasers, it was not necessary for the plaintiffs to institute the present action within one year from the date of the sale."

Because Landreneau is a builder-vendor of the dwelling, his knowledge is presumed and the prescriptive period of Article 2534 is not applicable.

The trial judge apparently found Article 2522 also inapplicable. In resolving the uncertainty and inexactness as to what the defendant told the plaintiffs regarding the flooding of the residence, he found as a fact that the extent of the seller's expressions to the buyers in the negotiations was to predict or opine that the house was not susceptible to flooding because of the cleaning out of the coulee. This is clearly not a declaration of the defect but rather a denial that the defect exists.

Because the trial judge found the prescriptive period of Article 2534 applicable, he did not reach the question of whether the action has prescribed under ...