Quality Design and Construction, Inc. VS City of Gonzales

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aTA E ( r L,P) JTi A1 1, A C3U 7 JF A k. I S I Fl` 31: a S: QUALITY DESIGN r 9VL CONSTRI 4; TION INC. VERSUS CITY OF GONZALES MAR 2 1 201 udgment rendered Appealed from the 23'° Judicial District Court and for the Parish of Ascension, Louisiana Trial Court No. 81 94 Honorable Thomas Kliebert, Judge ATTORNEY FOR SCOTT E. FRAZIER PLAIfvTIFF- 2ND APPELLANT BATON ROUGE, LA QUALTII DESIGN & CONSTRUCTION, J V. ROBERT RYLAND PERCY, III A ORNEY FOR DEFENUANT- 1 GONZALES, LA APPELi1 NT C'i fY OF GONZALES BEFORE: GUIDRY, PETTIGREW, McDOIVALD, McCLENDON, AND DRAKE, ] 7. P('' Fl V S. 4 C McC PinCc- n 17 5 S Ea"Ts J J7fJJ 7Jqs n. a,. lyU d/ y J j(1^ Gi..- L -+ JCtc je l J/ u c C 3¢.- dLD M.O lI ' PEITIGRE1fU, 7. The defendant; the City cfi Qnzafe ( judgment granting a wrrit af nar r ar so f.ae Ciryj, appeals a J nuary 3, 2013 t Thz mandam!as compels the Coty to pay a contract balance of $51, 20q. 00 previously. adj dged by the trial court ( and affirmed by this court) to be due and owing to the plaintiff, Quality Design and Construction, Inc. QDC). QDC also appeals that judgment assigning error to the court's failure to include an order compelling the City additianally to pay + nterest on the amount owed and due. PROCEDURALBACKGROUND , Prior Litigation Prior to the mandamus underlying this appeal, this matter was litigated regarding QDC's right to collect a money judgment frqm th,e City for the unpaid balance on a public works constructiore project ( a municipal water pa k for cfiildren), for which QDC was the successful low bidder. The trial court rendered judgment on Nlarch 9, 2006, against the City, awarding QDC the amount retained, $ 54,OQO, OQ, subject to a deduction for the liquidated damages of a 14-day overrun af the project, in the amount of $2, 800. 00, for a total judgment of $51, 200. 00, togetherwith all c sks. The trial court denied QDCs claim for attorney's fees. In written reasons for that judgment, the triai court stated that any future work authorized by the City to remedy ar repaQr aefective praducts or workmanship would be considered warranty wark, vhich was e ot and woUld not be covered by tfnat March 9, 2006 judgmenf. The tr'sa0 e urt furth r fo ar d the City's claim to recover amounts it had yet to expend for vFarranty v k r:or stit ated a separar action, and the trial court expressly reserved the Cify's ri4ht t s pu su such warranty claims. In an opinion rendered on November 28, 20Q7, this court affirmed the portion of the trial co rt's judgment finc ing that QDC w s entitled to payment of the contract balance in the total amount of $ 51, 200. 00. This court reversed that part of the trial court's judgment that denied QDCs claim for attorney`s fees, remanding the matter to the trial court for a determination of the appropriate award for attorney's fees. Finally, this court also amended the trial court's judgment to include leyal interest on the award of 54, 000. 00 from July 30, 2004 ( the date f judicial 2 emand) to the date of substantial completion of Quality D sign and Construction, Inc. v. City of the contract. Gonzales, 2006- 2211 ( L:a. C' w: App. 11/ 28 07 977 So. 2d 7. Neither party sought review of that judgment; thus, ii became fnal. Current L,itigation 1. On Octc taer 26, 2012, P ci s s a ar AfEers ative Writ of Mandamus, all.eging that notwithstanding thE zr al L? t's j agr a ne, havin,g beei iargely affrmed y this court and rendered final, na amount wha Qever ha been paid, by the City to QDC. Relying on La. R. S. 38`,2191( D), QE3 balance by writ of mandamus sora hk af ¬ rc the payment of the ontrack compelling ., e paycner t or" the sums due, toget er wvith attorney's fees, legal interest, and costs, After a hearing, the trial court, finding as: a matker of law that mandamus lies to compel payment of the contract balance; rendered judgment on January 3, 2013, granting the writ of mandamus, making it perempkory, and ordering Barney Arceneaux, in his capacity as Mayor of the City of Gonzales, to pay QDC the sum of $51, 200. 00. As noted earlier, both parties have appealed,., THE C1TY' S APPEAL. As appellant, the C ty asserks that _mandam as is nut ,an ap pcopriaie remedy pursuant to La. R.S. 38; 2191( D); sin e h s stan' i am majority of thE funds t ucgeted for the construction of the project have been exhas s d tt r ugh paym nts to QDC as we!! as payments to subsequent contracto and suppliers, hared "t cqrr2ct andlc r complet the scope of QDC's vvork. Tne City further-assents that ma+darr us is aisc not an appropriate remedy pursuant to that same statute ' because QDC failed to prove tfnat the City is withholding payment `°arbitrarily ar d witho t teas nable cause" as required by the statute. Thus, the City maintains re the triai cb STA erred in granting nnandamus. DARD OF REVIfW As revealed below, the Citar' s aRpeai req ir s us to interpret a Louisiana statute relative to the enfnrcement of a money judgment against a poli ical se bdavision of the state. BeCa se the proper interpretat a s ato te is necessarily a quest}on of !a, n 3 we apply City of a de of novci st, andard re Shreveport, 20a7'= 911, f. 1 lev man Marchiv Eewe ' 3( a. 4; 8' 0, ? Partnership, Inc. v. So. 2d 1262, 1265. APP I# BLE I.AVIf The paymenzs 38, Chapter 10. f r public contrac. s ar c a a e 9 by UUisiana R=vised Stata fes Title a. R.. 91E w9 ieh Q C' s ar uments rely, provides Specifically, 38 2 as follows A. All public entities shall promptly pay a91 obiigations arising under public contracts when the obligations become - due and payable under the contract. All progressive stage payments and final payments shall be paid when they respectively become due and payable under the contract. B. Any public entity failing to make any final payments after formal final acceptance and within forty-five days following r ceipt of a clear lien certificate by the public entity shafl 6e Iia6Pe for reasonable attorney fees. C. The provisions of this Section shall not be subject to waiver by contract. 0. Any pub/ic entity failing to make any progressive stage payments arbitra i/ or without reasonabl cause, or any fina/ payment when due as y provided in this Section, shall be subject to mandamus to compe/ the payment of the sums due under the coritract up to the amount of the appropriation made for the award and execution of the contracY: Emphasis added.) The issuance of mandamus generally is governed"by La. C. C. P. art. 3862, which provides A writ of mandamus may be issued in all cases where the law provides no relief by ordinary means or where the delay involved in obtaining ordinary relief may cause injustice; provided, h4wever, that no court shall issue or cause to be issued a writ of mandamus to compel tf e expenditure of state funds by any state department, board or agency, or any officer, administrator or head thereof,. or any o cer of the state of Louisiana, in any suit or action involveng ti e e cpenditure of public funds under any statute or law of this state, when khe direct r Af such department, board or agency, or the governor shali certify that the expenditure of such funds would have the ffect of creating a defi, it s n the funds of said agency or be in violation of the requirements pJac d upor the expenditure f such funds by the legislature; Because the City's arguments presen a questi ri o the proper ir terpretatian of La, R. S. 38: 2191( D), the follow ng principles of skatutory interpretatinn ar reievant and applicable herein. The function of statutory interpretation and the construct on to be given to legisiative acts rests with the judiciary. Livingston Parish Council on Aging v. Graves, 2012- 0232, p, 3 ( La. 12/ 4J12), 4 105 So. 3d 683, 685. The fundamental question in all cases of statutory interpr tation is Jegislative intent and the ascertainment of the reason or reasons that prompted the legisiature to enact the law. In re: Succession of Boyter, 99-0761, p. 9 ( La. 1/ 7/ 00), 756 So. 2d 1122, 1128. The rules of statutory constructi n are designed to ascertain and enforce the intent of the legislature. Id.; Stogner v, Stogner, 98- 3044, p. 5 ( La. 7/ 7/ 99), 739 So. 2d 762, 766. Legislation is the solemn express n uf legislative will, and therefore, interpretation of a law involves primarily a search for the legislature' s intent. La. R. S, 1: 4; La. C. C. art. 2; Lockett v. State, Dept. of Transp. and Development, 2003- 869 So. 2d 87, 90 ( oveitumed, on other g ounds, due to 1767, p. 3 ( La. 2/ 25/ 04), Legis/ative Action, La. R.S, i3:510. Moreover, the legislature is presumed to act with fuli knowledge of well- settled principles of statutory construction. School Bd. v. Louisiana 124 So. 3d 1065, 1073. Catahoula Parish Machinery Rentals, LLC, 2012- 2504, p. 13 ( La. 10/ 15/ 13), When a law is clear and unambiguous and its application does not lead to absurd consequences, the law shall be applied as written and no further interpretation may be made in search of the inteat of the legislature. La. C. C. art. 9; Lockett, 2003- 1767 at 3, 869 So. 2d at 90- 91; Conerly v. State, 97- 0871, pp. 3- 4 ( La. 7/ 8/ 98), 714 So. 2d 709, 710- 1i. DISCUSSION/ ANALYSIS Briefly, the undisputed facts regarding the underlying public works contract at issue herein are as foilows: In late 20Q3, the Coty budgeted and appropriated a sum of money for the construction of a p blic works project -- a chiidren' s " Sprayground" and other improvements to the publie recreational facility, 7ambalaya Park, in Gonzales. The City advertised for bids, and QDC, the lowest bidder, entered into e contract with the City for the initial price of $ 90,633.00, which was increa'sed by written change orders approved by the City to the sum of $407, 487. 24. The City and its project engineer executed and recorded a certificate of substantial completion verifying that the project was substantiaily complete as of July 30, 2004. Notwithstanding, the City refused to tender full payment to QDC, based on alleged outstanding warranty and defect claims. This litigation ensued. 5 The City, first, maintains that to La. R. S. 38: 2191( D), tt l. c tr construction af tihe SRraygro and haa tzee a tQ . paymerfis ub c- erent cc rt s scope ofQDC` wa` k. amount of the 382191( D). 1' Ihe e rrecd in c ranting mandamus pursuant xh s?e tt rc ugh payrn n s kc QDC and 1: rf s hi tc cor eer r n le r e mp,' te the e l o Ez s n: da u ta eamp l p yment " up to the stat te appropriation made u su'bs an ial najority of the faands budgeted for the hat urgir? g e f r the awa d iq Thus, the reai issue befqrA u is whett e x c tion f the confract." La. R.S, he. City's payments to these other contractors and suppliers can have the lawful effeCt of diminishing that amount upon application of the statute's mandate. The City argues that execution of the contract, as used in the statute, refers to the satisfactory completion of the Sprayground and not to its ic dividual contract with QDC. The City further maintains that mandamus is not proper pursuant to the statute because it requires the City's withholding of final payment to be " arbitrary and without reasonable cause.° The City asserks that its withh lding of the payment was " due to [ its] pending warranty/ defect claims" against QDC re dering its action reasonable and, therefore, outside the scope af the stat te' s r ar dak: given the high likel'shood of set off;" those clasm Mareover, the Gity argues that, rr ust be dee ded before th City can be compelled by mandamus, purSua t tQ La R.S. 3 J: 141( G, to pay the judgnnent. The City adds that the origirral judgrr ent " v ras predicatecf a preservatlon of the Ciry' s right to pursue its warranty/ defect claims;` preve tir g said judgment from becoming due and payable until those claims are resolved. The City also cla[ ms mandamus is impra er because QDC has failed to carry its alleged burden under the statute to sub it evid nce proving the existence of appropriated funds remaining within the Cifry`s vudg t fram whi h the recovery can be had. ( Admittedly, only $ 42389. 00 remaens, s the esf of the apprUpriated fa nds have been exhaust d by payments to subsequeRt' contra tor f ired to eeme y QDCs aileged inadequate complet or of the project. Finafly, the City mainta ns rr anda na s s i nproper ir light af QDC`s faoiur to p ove any ir ustice caus d by a deiay in obtai eng ordinary releef, as r quie d by La. C. C.P. 6 3862, The CiiY efai r s ord r ary reloe eara be had y r solving it , pe d ¢,ng litigation for warranty/ efect c aims and d t r-nar' sng t e rr u t of set off, 9f any,, prior to being compe led to pay the judgmer t We fir d t e argc m nt -- # iky' project," which would includ k the s;?; ute aP 9i s ta fund ap irc;psia'ted Yo the a6" fun ls paid tQ ali ather contractors subsequently hired, rather than to the'" contract" and tne contractc r t whorn thE projec was awarded -- wholly iacks merit. The statute specifically and ; nambiguously refers to appro,priation for' the made award and execuGon of fhe contract° { Emphasis added.} Had the legisiature meant a nou nts appropriated for the whc le project, it would fhave used that languag, and ieft to one entity. t the word °'award;" because the " awarding" of the contract is Qn1y Inde d;. by referring t the, a propiria i ¬ n made for the award and execution of the contract, the stat te prc mcates the legisl kive intentt to pr vide f r the promat payment ta eontractors awarded puplie v rks. contracts. Paragrapn C of ±he statute prohibits waiver of the statutory pro isions by contract, further supporting the lack of leyislative intent tQ leave payme t e f kl ese cantracts t tne discretion of the City in any way. Additionally, the City cites no auti ority for its unter able proposition that avai{ability of the mandamus relief in La. R.S. 38: 2. 91tQj is conditioned on appropriate. funds rernaining availaolei ° fhe statute does no't refer t appropriate tunds remair a g available; rather, i. cl arly states app opriatvon "' f r tf e award a d ea ecuti9n of the contract." The fact that the City has s ent tf os appr ¢opriated f nds on othe : ontracts in violation of the stafute' s m rdate, aiari s[appor s a hndi aj that its raonpayr ent of `Che contracE baiance warcan s mandarr us resief, Further, we find no merot to xhe City`s a- y ra ent that its withho ding p ment of the judgmerlt is reasonable in ight of its pending sulE ayainst QDC for warranty work and defective produets. As specifically ordered by the krial caurt those cBaims er compass an entirely difFerent and separate lawsuit. The execution of the fina judgment renaered in this matter, fnding the City liable for the remaining unpaid balance of the contract, does not hinge on the outcome oP that separate lawsuit. Ar de pursuant to ithe mandaxe of La. 7 R. S. 38: 2191( D), mandams s ps th appropri te and r per remedy y which QDC can e cecute that judgment. Therefore, we affi m compelling ¢h Citd u; he G t y? j t crsr; r c- a C" Q QDC appeafs that portien r t Qf xh ¢ adgin? f i baf+ aai : d iP'P t rney' s fees, but that on app a! of Oai. 00. a ., 1, in addition to the sum ordered tc e a'id y. he r a ar tir g mandarnus, and enc tr; i ' sls ra include an award of in: e e ; ud the earlier latigation over the balance r - tdamus grd at. lt oints out that in v d, he rs l court failed to award iC t rest tha Jud st ti is court arraendeci the trial ra nd aurt`s judgment, finding it erred in failing to award er ker, st ar d a torney's fees, and awarded e such. date Specifically, this court awaraed i teresf du ubstantiat completion of of or the sum of $51, 200.00 from the July 30; . 2004. ( As earlier noted, the the coratract record reveals that the City and its project enginee zxecuted a certificate of substantial completian verifying that the proj ct was substartea4ly cornplete as of ] uly 30, 2004, and the. rnartg that 5aid certificate was recorded p iid not QD, appeal that judgm nt; a nnainta ns that 38: 2i91( D) because it as triai court rred thc ac ii 9t bec m fsr a, no arish.) The City ayr esa s w ere nnade ta khe matte- bef re as. resulting QQC f Ascens c n reeords a ae part af Yh " in r ai incf di y The gran¢ Qf i ard av r sums du ., r i uf ie x j diciai ince es os c veera n uitreira the mardato r scQpe af a R,S, steres + ed t ae onY act,°` arod herEfs re, t ie o t 2 rriandar eus as der. r d y i. i,.P. ar. 1921, which states C. that "[ t] he court shafl award interest en the j dgrnent s prayed fior or as prQVided by law.'" ( Emphasis added.)' Since khe word " sh l9" i Le. . C. P. art 1921 is mandatory, the court lacks discreteon to deny interest if anterest os prayed for or provided for by law. La. R. S. 1 3; Bickham So2d 7Q7, 710- 11, Louisiana Civ i! v. Bickham, 2QQ2- 13(37r p. 5 La. Ap. 1 Cir. 5/ 9/ 03;, 849 Under Lcuisiana l w; de ts k e. r 'snterest fr m the au ode artacle 2000 pr+ ides `"[ u] e r h date, abjeet of the p rf rmance is a sum of money, darnages for elay r pe fvrmanc ar measu ed y tlie irrterest on. that sum from the tirrne:it is due ...." ( Emphas s added. l In C. Ro Humphreys Gen ral Gontractor, Irrcm r, Tangipahoa Parish School System, 2007- 0993E unpublished apinio), pp. 16- 17 ( La. A? pa wrlt when it found the " f ngipahoa sr j 12 2.1%07), r 20 Dt- Q156 ` La. dene contractor for a public worics Y r c t appeal Paris 3r14/( 1$), 2007 VtiL 4480064, 9 97? So. 2ctl 934, the criai c4ur''s iailure tc award anterest chaol Syster owed it the dalance of a contract pursuant to La. R.S. 38: 2191. This court found the contractor was entitled to interest on the contract sum awarded from the date of its final pay request. This court cited Thomas B. Catchings and Associates v. City of Batqn Rouge, 621 So. 2d 767 ( La. 1993), where the supreme court found that plaintiffswere entitled to legal interest on the amount owed them undera public works contract from the date of default, which again, in this case, would support such an award from the date of the execution of the certificate of substantial completion, The only argument presented by the City to contradict QDC's assertion of entitleme t to an award of interest `s a re- urgin of its .argument in opposition to the mandamus grant, that the statute appfies oniy t appropriated fiunds stiiP unspent and availabie for distribution. For the reaSOns we fo and Yhis argument had no merit as it refates to the grant of mandamus, we lik wise find 6t lacks mer ts insofar as QDC`s entitlement to interest on the amount awarded uia mandamus, Accordingly, we grant QDCs appeal, and amend the ; udgment of the trial court granting the writ of mandamus to include an auvard f interest owed to QDC by the City of Gonzales on the amount of the judgment, $51, 20. 00, from July 30, 20D4, until paid. GONCLUSION For the foregoing reasons, the January 3, 20 3 jucigment vf the krial court gca ting the writ of mandamus is amended to include ar award of inter s t on the total amount due from the date of July 30, 2Q04, Jntil paid, an as amended, it is affirr ed Costs of this appeal in the amoun' of $2, 386. 5Q are assessed against the City of Gonzales. AMENDED, AND AS AMENDED, APFIRNIE0. 9 STATE OF LOUISIANA COURT OF APPEAL FIlZST CIRCUIT NiJMBER 2013 CA 0752 QUALITY DESIGN AND CONSTRUCTION, INC. VERSUS CITY OF GONZALES GUIDRY, J., dissents in part and assigns reasons. GiTIDRY, J., dissenting in part. While I agree with the majority's affirmance of the trial court judgment insofar as it grants the plaintiffs petition for mandamus to compel payment of the contract balance owed to the plaintiff, I disagree with the majarity's decision to amend the judgment to compel payment of the award of interest on the judgment by virtue of the writ of mandamus as well. The law is clear that mandamus is an extraordinary remedy, which must be used sparingly by the court and only to compel action that is clearly provided by law. Pelican Educational Foundation, Inc. v. Louisiana State Board of Elementarv and Secondarv Education, 11- 2067, pp. 56 ( La. App. lst Cir. 6/ 22/ 12); 97 So. 3d 440, 444. A writ of mandamus should be issued only in cases where the law provides no relief by ordinary means or where the delay involved in obtaining ordinary relief may cause injustice. La. C. C. P. art. 3862; Board of Trustees of Sheriffs Pension and Relief Fund v. City of New Orleans, 02- 0640, p. 2 ( La. 5/ 24/ 02), 819 So. 2d 290, 292. Whereas the plaintiff is clearly entitled to an award of interest on its judgment in accordance to La. C.C.P. art. 1921, neither that article nar La. R.S. 38: 2191( D) provide authority for compelling the payment of such interest by use of the writ of mandamus. For these reasons, I respectfully dissent from that portion of the majority opinion finding otherwise. 2

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