Stevens Construction & Design, L.L.C. v. St. Tammany Fire Protection District No. 1 ( 2020 )

STATE OF LOUISIANA
COURT OF APPEAL
FIRST CIRCUIT
NO. 2019 CA 0955
STEVENS CONSTRUCTION & DESIGN, L.L.C.
VERSUS
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ST. TAMMANY FIRE PROTECTION DISTRICT NO. 1
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Judgment Rendered: ' JUL 0 8 2020
On Appeal from the
22nd Judicial District Court
In and for the Parish of St. Tammany
State of Louisiana
Trial Court No. 2018- 14143
Honorable Martin E. Coady, Judge Presiding
Charles K. Chauvin Attorney for Plaintiff A
- ppellant,
Jane Williams Chauvin Stevens Construction & Design, L.L.C.
Destrehan, LA
Troy G. Ingram Attorney for Defendant -Appellee,
Slidell, LA St. Tammany Fire Protection District No. 1
Albert Dale Clary Attorneys for Defendant/Intervenors- Appellees,
Adrian G. Nadeau Domain Architecture, APAC,
J. Weston Clark Greenleaf Lawson Architects, APAC, and
Baton Rouge, LA Domain Architecture + Greenleaf Baton Rouge,
Architects, A Joint Venture
BEFORE: HIGGINBOTHAM, PENZATO, AND LANIER, JJ.
L g J
HIGGINBOTHAM, J.
In this mandamus proceeding, the contractor in a public works contract
appeals the trial court judgment dismissing the contractor' s petition for a writ of
mandamus and exceptions of improper joinder, no cause of action, and no right of
action.
FACTS AND PROCEDURAL HISTORY
On May 11, 2017, Stevens Construction & Design, L.L.C. ( Stevens
Construction) entered into a public works contract with the St. Tammany Fire
Protection District No. 1 ( Fire District), wherein Stevens Construction would serve
as the general contractor for the construction of a new fire station and headquarters
building located at 522 Robert Boulevard and 530 Robert Boulevard in Slidell,
Louisiana (the construction contract). The total sum for the construction project was
2, 845, 678. 00. The architect for the project was a joint venture between two
architectural firms, Domain Architecture, APAC ( Domain) and Greenleaf Lawson
Architects, APAC ( collectively " the Architect"). The Architect entered into a
separate contract with the Fire District to provide design services and administer the
construction contract between the Fire District and Stevens Construction as the Fire
District' s representative ( the architecture contract). The Architect' s obligations
included reviewing Stevens Construction' s pay applications, evaluating if the work
was done in conformance with the construction contract, and certifying the
applications to the Fire District for payment.
The construction contract between the Fire District and Stevens Construction
provided for completion of the project in 365 calendar days. Construction work on
the project began on June 1, 2017, pursuant to a " Notice to Proceed" issued by the
Fire District. An additional 47 calendar days were added to the construction
contract' s completion date pursuant to approved change orders, making July 18,
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2018 the scheduled date of substantial completion. However, the project was not
complete by that date.
During construction, some of Stevens Construction' s pay applications on the
project were not certified by the Architect, either in whole or in part, and payments
were withheld from Stevens Construction. Specifically, on April 9, 2018, the
Architect issued a letter to Stevens Construction advising that " Pay Application No.
9 will show a deducted amount of $24, 600. 44 in reference to K Barber Enterprises'
claim of non-payment." On August 15, 2018, by letter, the Architect informed
Stevens Construction that it was deducting from Pay Application No. 13 in the
amount of $ 161, 228. 78 for the following reasons: incomplete work, claims of
nonpayment by third parties, and liquidated damages for being behind schedule. On
August 22, 2018, Fire Chief Chris Kaufmann sent a letter to Stevens Construction
and its surety by electronic and certified mail, summarizing his concerns with
Stevens Construction' s performance on the project and directing Stevens
Construction to stop work on the project by 4: 00 p.m. on August 23, 2018. After
Stevens Construction had been terminated, it submitted Pay Application No. 14. The
Architect responded stating that under Section 14. 2. 3, when the Fire District
terminated the construction contract, Stevens Construction shall not be entitled to
further payments until the work is finished. Thereafter, Stevens Construction also
submitted Pay Applications Nos. 15 and 16 and neither application was certified for
payment by the Architect.
On August 23, 2018, Stevens Construction filed a verified petition for
temporary restraining order, preliminary injunction, permanent injunction, and writ
of mandamus contending that the Fire District improperly withheld payment on Pay
Application No. 9. Stevens Construction named the Fire District as the defendant.
On August 24, 2018, the trial court signed a temporary restraining order, enjoining
the Fire District from taking any further action to enforce the subject stop work order
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or otherwise bar Stevens Construction from continuing to complete its work on the
project. On September 4, 2018, the Fire District issued a Notice of Termination to
Stevens Construction detailing the reasons the Fire District found sufficient cause
for terminating Stevens Construction. Attached to the Notice of Termination was
the Architect' s certification -of c- ause letter providing reasons why sufficient cause
existed for terminating Stevens Construction.
The trial court held a hearing on the preliminary injunction on September 4
and 6, 2018. Following the hearing, the trial court found that Stevens Construction' s
request for a preliminary injunction should be denied, and that its temporary
restraining order should likewise be dissolved. Stevens Construction appealed this
ruling, but the appeal was untimely and was dismissed. Stevens Construction &
Design, L.L.C. v. St. Tammany Fire Protection District No. 1, 2018- 1759 ( La.
App. 1 st Cir. 1/ 16/ 20), _ So. 3d , _. As a result, the only issue that remained from
the original petition was Stevens Construction' s request for a writ of mandamus
compelling payment by the Fire District under La. R.S. 38: 2191.
On September 5, 2018, Domain filed a petition for intervention stating that it
has an interest in the action in order to fulfill its contractual obligations, enforce its
contractual rights, and participate in the proceeding that seeks a judicial
determination as to the performance of its contractual obligations. Stevens
Construction answered Domain' s petition for intervention asserting a dilatory
exception of improper joinder and a peremptory exception of no cause action. In the
exceptions,
Stevens Construction argued that Domain was not a party to the
construction contract between Stevens Construction and the Fire District, and
therefore had no community of interest with the Fire District. Stevens Construction
also argued that Domain failed to state a justiciable cause between the parties that is
related or connected to the facts in the principal demand. Thereafter, Stevens
Construction filed two amended petitions contending that the Fire District also
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improperly withheld payment on Pay Application Nos. 13, 14, 15, and 16, and
seeking a writ of mandamus to compel payment under Pay Application Nos. 9, 13,
14, 15, and 16.
Stevens Construction' s petition for writ of mandamus seeking payment under
Pay Application Nos. 9, 13, 14, 15, and 16, and Stevens Construction' s exceptions
of improper joiner and no cause of action came before the court for a hearing on
January 3, 2019. Prior to addressing the mandamus action, the trial court orally ruled
permitting Domain to intervene in the suit.
After the hearing, the trial court allowed all parties to submit post -hearing
memoranda. Prior to the trial court rendering a judgment, Stevens Construction filed
a peremptory exception raising the objection of no right of action again contending
that Domain had no interest in the matter because Domain did not introduce evidence
of the joint venture or a separate contract with the Fire District. In response, Domain
requested leave to file an amended petition with the sole purpose of adding to the
petition for intervention, Greenleaf Lawson Architects, APAC and Domain
Architecture + Greenleaf Architects, A Joint Venture as petitioners/ intervenors. On
January 17, 2019, Stevens Construction requested permission to file an omnibus
amended and restated petition for the purpose of removing all references to the
Architect and limiting the focus of the suit to the Fire District.
After a hearing on January 29, 2019, the trial court denied Stevens
Construction' s exception of no right of action, allowed Domain' s leave to file its
amended petition for intervention to add petitioners, and denied Stevens
Construction' s leave to file its post -trial omnibus amended petition. On February
11, 2019, the trial court signed a judgment dismissing Stevens Construction' s
petition for writ of mandamus and no right of action, and on February 26, 2019, the
trial court signed a judgment denying Stevens Construction' s dilatory exception of
improper joinder and peremptory exception of no cause of action.
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It is from the February 11, 2019 judgment that Stevens Construction appeals.
While Stevens Construction raised several assignments of error, its appeal raises
primarily two main issues: ( 1) Whether the intervention of Domain, who was not a
party to the construction contract and was only one party to the joint venture, was
proper, and ( 2) Whether the trial court erred in dismissing Stevens Construction' s
writ of mandamus.'
LAW AND ANALYSIS
I. INTERVENTION
Stevens Construction contends that Domain' s intervention in the proceeding
was improper, and therefore any evidence presented by Domain at the mandamus
hearing should be stricken from the record. Stevens Construction contends that
because the Fire District did not call any witnesses or present any evidence, without
the evidence presented by Domain, a reversal of the judgment denying its writ of
mandamus is warranted.
Louisiana Code of Civil Procedure article 1091 provides:
A third person having an interest therein may intervene in a pending
action to enforce a right related to or connected with the object of the
pending action against one or more of the parties thereto by:
1) Joining with plaintiff in demanding the same or similar relief against
the defendant;
2) Uniting with defendant in resisting the plaintiff' s demand; or
3) Opposing both plaintiff and defendant.
Article 1091 and the jurisprudence construing it establish that the requirement for
intervention is two -fold: the intervenor must have a justiciable interest in, and a
1 On appeal, the Fire District filed a peremptory exception raising the objection of no cause of
action. In its exception, the Fire District contends that Stevens Construction' s petition fails to state
a cause of action for mandamus under La. R.S. 38: 2191. We find that accepting all well -pleaded
allegations as true in Stevens Construction' s petition, the petition sufficiently states a cause of
action pursuant to its contract with the Fire District and La. R. S. 38: 2191. In its petition and
amended petition, Stevens Construction alleged that it submitted pay requests to a public entity,
the Fire District, the Fire District withheld its payments that were due under the contract, and the
Fire District' s refusal to pay was in violation of public bid law.
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connexity to, the principal action. Clark v. State, Dept. of Revenue, 2002- 0703
La. App. 1st Cir. 5/ 9/ 03), 849 So. 2d 700, 705, writs denied, 2003- 1600, 2003- 1619
La. 10/ 3/ 03), 855 So. 2d 320, 321. A "justiciable interest" is defined as " the right
of a party to seek redress or a remedy against either [ the] plaintiff or defendant in
the original action or both, and where those parties have a real interest in opposing
it." Mike M. Marcello, Inc. v. Louisiana Gaming Control Board, 2004- 0488 ( La.
App. 1st Cir. 5/ 6/ 05), 903 So. 2d 545, 548 ( quoting In re Succession of Walker,
2002- 625 ( La. App. 5th Cir. 12/ 11/ 02), 836 So. 2d 274, 277.) The right, if it exists,
must be so related or connected to the facts or object of the principal action that a
judgment on the principal action will have a direct impact on the intervenor' s rights.
Id. An intervenor takes the proceedings as he finds them and cannot change the
issues between the parties or raise new ones. IberiaBank v. Live Oak Circle
Development, L.L.C., 2012- 1636 ( La. App. 1st Cir. 5/ 13/ 13), 118 So. 3d 27, 32.
Stevens Construction' s petition for a writ of mandamus repeatedly alleged
that the Architect failed to perform its obligations under the construction contract
and architecture contract. The petition stated: "[ t]he Architect failed to comply with
Section 9. 4. 1 of the [ construction] contract," " the Architect would not take action
until six more days after the deadline," " the Architect failed to comply with the seven
day deadline," and "[ Stevens Construction] has never received a notice of rejection
of work from the Architect."
Based on our review of this record, we find Domain clearly satisfied the two-
part test for intervening in the pending litigation. Domain has a justiciable interest
in the action as Stevens Construction was asking the trial court to make several
factual findings regarding Domain' s performance under its contract with the Fire
District, as well as under sections of the construction contract. Domain' s
intervention has sufficient connexity to the principal action as the defense of the
Architect and the Fire District arise out of identical facts, and any judgment rendered
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on the principal action would have a direct impact on Domain' s rights under its
contract with the Fire District. We find no error in the trial court' s decision to deny
Stevens Construction' s exceptions of improper joinder and no cause of action.
Additionally, we find no error in the trial court judgment denying Stevens
Construction' s exception of no right of action, or allowing Greenleaf Lawson
Architects, APAC and Domain Architecture + Greenleaf Architects, A Joint Venture
to be added as petitioners/ intervenors after the mandamus hearing.' The architecture
contract lists the Architect as Domain Architecture + Greenleaf Architects, A Joint
Venture, the joint venture' s letterhead is used throughout the record, and Stevens
Construction in its original petition acknowledged that "[ a] t all times the Architect
for the Project has been a joint venture between two architectural firms, Domain
Architecture ... and Greenleaf Lawson Architects." Stevens Construction was not
prejudiced by adding the additional intervenors after completion of the mandamus
hearing.'
II. MANDAMUS
We turn now to Stevens Construction' s contention that the trial court erred in
denying its mandamus action under La. R.S. 38: 2191. An appellate court reviews a
2 A joint venture results from the undertaking by two or more persons to combine their efforts,
knowledge, property or labor to engage in and carry out a single business venture for joint profit.
Riddle v. Simmons, 589 So. 2d 89, 92 ( La. App. 2d Cir. 1991), writ denied, 592 So. 2d 1316 ( La.
1992). A joint venture is analogous to a partnership and controlled largely by the rules applicable
to partnerships. There must be a sharing of the profits and losses with each party having some
right of control over the business. The existence or non- existence of a joint venture is a question
of fact and each case must be considered according to its circumstances. Id. No formal or specific
agreement is required. Generally, the relationship may be formed by an oral agreement and the
existence of a joint venture may be inferred from the conduct of the parties and other
circumstances. Id. We find no error in the trial court' s factual finding that Domain and Greenleaf
entered into a valid joint venture.
3 While Stevens Construction makes several creative arguments about the validity of Domain' s
intervention, we addressed the arguments only briefly because, regardless of whether Domain or
the Joint Venture had a right to intervene, the salient issue in this appeal is whether the trial court
correctly determined that the Fire District should not be subject to mandamus under La. R.S.
38: 2191. The evidence relied on by the trial court to conclude mandamus was not appropriate,
including the contracts, the pay applications, and the letters sent by the Architect regarding pay
application withholdings were introduced into the record by joint stipulation and not solely by
Domain. Without the evidence presented by joint stipulation, Stevens Construction certainly
would not have sufficient evidence to prove mandamus was appropriate in this case.
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trial court' s judgment denying a writ of mandamus under an abuse of discretion
standard. Chaisson v. State, Department of Health & Hospitals through
Registrar of Vital Records, 2017- 0642 (La. App. 4th Cir. 3/ 7/ 18), 239 So. 3d 1074,
1078, writ denied, 2018- 00540 ( La. 5/ 25/ 18), 243 So. 3d 567. "[ F] indings of fact in
a mandamus proceeding are subject to a manifest error standard of review." Id.However, in prior appeals involving the interpretation of La. R.S. 38: 2191 relative
to a money judgment a de novo standard of review is applicable because " the proper
interpretation of a statute is necessarily a question on law." See Quality Design and
Construction, Inc. v. City of Gonzales, 2013- 0752 (La. App. 1st Cir. 3/ 11/ 14), 146
So. 3d 567, 569- 570. 4
The general mandamus article of the Louisiana Code of Civil Procedure
defines mandamus as " a writ directing a public officer, a corporation or an officer
thereof, or a limited liability company or a member or manager thereof, to perform
any of the duties set forth in Articles 3863 and 3864." La. Code Civ. P. art. 3861.
A writ of mandamus may be directed to a public officer to compel the performance
of a ministerial duty required by law, or to a former officer or his heirs to compel the
delivery of the papers and effects of the office to his successor. La. Code Civ. P. art.
3863. A ministerial duty is " a simple, definite duty, arising under conditions
admitted or proved to exist, and imposed by law." Hoag v. State, 2004- 857 ( La.
4 Stevens Construction suggests that the trial court made legal error in its interpretation of La. R.S.
38. 2191 and La. R.S. 38: 2248. We reject Stevens Construction' s argument that under La. R.S.
38: 2191 a public entity is not permitted to exercise any discretion in withholding payment upon
receipt of a certified pay application and any contractual provision that allows for discretion is null
and void. The Statute provides for mandamus to compel payment of sums due under the contract
and does prohibit contractual provisions that allow the Architect to withhold a certificate for
payment in whole or in part for reasons set forth in the contract.
Further, we are not persuaded by Stevens Construction' s argument that the trial court failed
to comply with La. R.S. 38: 2248( A) by withholding more than the 5% allowed by law. Louisiana
Revised Statute 38: 2248 prohibits public works contracts from containing a provision withholding
more than five percent of the contract price until the expiration of forty-five days after the
recordation of the formal acceptance of such work, or notice of default by the contractor or
subcontractor. By the plain terms of the statute, it disallows a contract provision allowing for more
than 5% retainage. The contract herein contained no such provision allowing for more than 5%
retainage.
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12/ 1/ 04), 889 So. 2d 1019, 1024. The critical element necessary for the issuance of
mandamus is that " the public official to whom the writ is directed may exercise no
element of discretion when complying." Id. If a public officer is vested with any
element of discretion, mandamus will not lie. Id. Payments for public contracts are
governed by Louisiana Revised Statutes Title 38, Chapter 10. Specifically, La. R.S.
38: 2191 provides:
A. All public entities shall promptly pay all obligations 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. ( 1)Any public entity failing to make any progressive stage payment
within forty-five days following receipt of a certified request for
payment by the public entity without reasonable cause shall be liable
for reasonable attorney fees and interest charged at one- half percent
accumulated daily, not to exceed fifteen percent. Any public entity
failing to make any final payments after formal final acceptance and
within forty- five days following receipt of a clear lien certificate by the
public entity shall be liable for reasonable attorney fees and interest
charged at one- half percent accumulated daily, not to exceed fifteen
percent.
2) Any interest received by the contractor pursuant to Paragraph ( 1) of
this Subsection, shall be disbursed on a prorated basis among the
contractor and subcontractors, each receiving a prorated portion based
on the principal amount due within ten business days of receipt of the
interest.
C. The provisions of this Section shall not be subject to waiver by
contract.
D. Any public entity failing to make any progressive stage payments
arbitrarily or without reasonable cause, or any final payment when due
as provided in this Section, shall be subject to mandamus to compel the
payment of the sums due under the contract up to the amount of the
appropriation made for the award and execution of the contract,
including any authorized change orders.
Subsection D of La. R.S. 38: 2191 sets forth two circumstances where
mandamus relief is available against public entities: ( 1) when a public entity has
failed to make progressive stage payments arbitrarily or without reasonable cause
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under a contract; or ( 2) when a public entity had failed to tender a final payment
when due under the contract.
Thus, in order to be entitled to mandamus relief against the Fire District,
Stevens Construction must establish that the Fire District " arbitrarily or without
reasonable cause" failed to make progressive stage payments or failed to make final
payment "when due" under the contract. See State through Morrell v. City of New
Orleans through Landrieu, 2017- 0110 ( La. App. 4th Cir. 12/ 21/ 17), 234 So. 3d
1071, 1080, writ denied, 2018- 0116 ( La. 3/ 9/ 18), 237 So. 3d 1192, ( holding that
plaintiff as the party seeking the writ of mandamus, has to establish that they were
entitled to the relief provided by this extraordinary remedy). The public entity is not
subject to mandamus compelling payment when the terms of the contract give the
public entity discretion as to whether payment is due and payable. Mandamus relief
under La. R. S. 38: 2191 is available only when there is no discretion left to the public
entity as to whether payment is due and payable under the terms of the contract.
Wallace C. Drennan, Inc. v. St. Charles Parish, 2016- 177 ( La. App. 5th Cir.
9/ 22/ 16), 202 So. 3d 535, 544. "[ R] easonable cause" for nonpayment exists when
the terms of the contract do not mandate payment under certain circumstances of the
particular case. Id.The following are relevant provisions from the construction contract,
including the general conditions of the construction contract, that were relied on by
the trial court to provide when payment is due and when a certificate for payment
can be withheld:
Section 5.2. 1 " Final payment constituting the entire unpaid balance of the Contract
Sum, less retainage as set forth in Section 5. 1. 6, shall be made by the Owner to the
Contractor when . 1 the Contractor has fully performed the Contract...; and
2 a final Certificate for Payment has been issued by the Architect."
Section 5. 2.2 provides in part: "[ t]he normal retainage shall not be due the contractor
until after Substantial Completion and expiration of the forty-five day lien period
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and submission to the Architect of a clear lien certificate, consent of surety and
invoice for retainage."
Section 9. 5. 1 " The Architect may withhold a Certificate for Payment in whole or in
part, to the extent reasonably necessary to protect the Owner, if in the Architect' s
opinion the representations to the Owner required by Section 9. 4.2 cannot be made."
Also, Section 9. 5. 1 allows for the Architect to protect the owner from loss resulting
from: ". 1 defective work not remedied; . 2 third party claims filed or reasonable
evidence indicating probable filing of such claims unless security acceptable to the
Owner is provided by the Contractor; . 3 failure of the Contractor to make payments
properly to Subcontractors or for labor, materials, or equipment; . 4 reasonable
evidence that the Work cannot be completed for the unpaid balance of the Contract
Sum; . 5 damage to the Owner or separate contractor; . 6 reasonable evidence that the
Work will not be completed within the Contract Time, and the unpaid balance would
not be adequate to cover actual or liquidated damages for the anticipated delay; or
7 repeated failure to carry out the work in accordance with the Contract
Documents."
Section 9. 4.2 provides that: "[ t]he issuance of a Certificate for Payment will
constitute a representation by the Architect to the Owner, based on the Architect' s
evaluation of the Work and the data comprising the Application for Payment that, to
the best of the Architect' s knowledge, information, and belief, the Work has
progressed to the point indicated and that the quality of the Work is in accordance
with the Contract Documents."
Section 14. 2. 3 provides: " when the Owner terminates the Contract for one of the
reasons stated in Section 14. 2. 1 , the Contractor shall not be entitled to receive further
payment until the Work is finished."
After hearing the testimony and considering many documents related to
Stevens Construction' s writ of mandamus, the trial court provided the following
detailed reasons for its decision to deny Stevens Construction' s writ of mandamus
under each pay application at issue.
Pay Application No. 9
In a letter, ... Justin Greenleaf, one of the architects on the
project, notified [ Stevens Construction] that $ 24,600.44
was being
withheld from certification on pay application 9 because of a claim of
nonpayment made by a third -party vendor... .
Stevens Construction] submitted a " Claim" as set forth in the
contract disputing the withholding from pay application 9. The
architect, in its contractual role as Initial Decision Maker (" IDM"),
responded to and rejected [ Stevens Construction' s] claim, citing section
9. 5. 1 of the General Conditions, which specifically authorizes the
architect to withhold certification " to the extent reasonably necessary
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to protect the Owner... because third party claims
of ... filed or
reasonable evidence indicating probable filing of such a claim."
Based on the evidence and contractual provisions, the Court
finds that the $ 24, 600. 44 which was withheld from certification in pay
application 9 was not " due and payable" under the terms of the contract,
and the Fire District' s action in withholding payment of $24, 600.44 was
not arbitrary or without reasonable cause under the circumstances.
Footnote omitted.)
Pay Application No. 135
Stevens Construction] submitted a request for payment in the
amount of $ 451, 257. 48 in payment application 13... The architect
withheld $125, 299. 08 from the total requested due to a finding of
incomplete work at the time of billing, claims of non-payment by a
third -party, and liquidated damages. [ Stevens Construction] submitted
a Claim objecting to the withholdings which was subsequently denied
by the architect in its role as IDM. In the IDM ruling, the architect
addressed each line item for which it withheld certification with reasons
explaining each withholding, attaching photos of its observations at the
project site. A total of $ 89, 203. 45 was deducted from the pay
application due to the architect' s finding of incomplete work at the time
of billing. ( Footnotes omitted.)
As to the withholding of $25, 625. 63 due to a claim of non-
payment by ABC Supply, as noted previously, the General Conditions
of the contract allow for withholdings due to " third party claims".
Accordingly, the Court finds that the amounts withheld from
certification in pay application 13 were not " due" under the terms of
the contract, and therefore the Fire District was not arbitrary or without
reasonable cause in not paying those amounts withheld from
certification.
Pay Application No. 14
Stevens Construction] submitted pay application 14 on August
31, 2018 which was never certified or paid. On August 24, 2018, the
Fire District gave [ Stevens Construction] seven days notice of its
termination of the contract for Cause under Section 14. 2.2 of the
General Conditions, and a Notice of Termination for cause letter was
issued to [ Stevens Construction] on September 4, 2018. In a letter dated
September 7, 2018 to [ Stevens Construction] the Architect asserts that
pay application 14 could not be certified because section 14. 2. 3 of the
5 In its reasons for finding that the amounts under Pay Application No. 13 were not due, the trial
court thoroughly considered Stevens Construction' s argument that under the Woodrow Wilson
decision, the Fire District cannot justify withholding payments based on a claim of liquidated
damages for delay. We agree with the trial court' s conclusion that the Woodrow Wilson case,
which considered liquidated damages when all express terms for final payment of a contract were
met, is distinguishable from the circumstances in this matter. See Woodrow Wilson
Construction LLC v. Orleans Parish School Board, 2017- 0936 (La. App. 4th Cir. 4/ 18/ 18), 245
So. 3d 1, writ denied, 2018- 0971 ( La. 10/ 8/ 18), 253 So. 3d 793.
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General Conditions of the contract provides that " when the owner
terminates the contract for one of the three reasons stated in
sectionl4. 2. 1, the contractor shall not be entitled to receive further
payment until the work is finished." At the time pay application 14 was
submitted, the work on the project was not finished, so pursuant to the
contract the architect could not certify the release of any funds to the
contractor.
Accordingly, the Court finds that the amounts withheld
from certification in pay application 14 were not " due" under the terms
of the contract, and therefore the withholding of payment by the Fire
District under the circumstances was not arbitrary or without
reasonable cause.
Pay Application No. 15
In pay application 15, [ Stevens Construction] requested final
payment of the remainder of the contract balance, less a five percent
retainage. The Architect asserts that to receive final payment under the
contract, the contractor must have fully performed the contract, and a
final Certificate for Payment must be issued by the Architect. Other
requirements include approval and acceptance of a substantial
completion certificate, formal final acceptance of the work, a receipt of
clear lien and privilege certificate from the contractor, and various other
requirements. There was no evidence presented to support that these
contractual requirements were met. ( Footnote omitted.)
The evidence clearly establishes that the requirements for final
payment were not met, therefore no ministerial duty arose. The Court
also notes that under the circumstances, the Fire District had reasonable
cause to withhold final payment.
Pay Application No. 16
In pay application 16, [ Stevens Construction] requested the
142, 587.46 retainage amount that had been withheld during the
contract. Pursuant to section 5. 2. 2 of the agreement, retainage " shall
not be due the contractor until after 1) substantial completion, 2)
expiration of the forty- five day lien period and submission to the
Architect of a clear lien certificate, 3)
consent of the surety, and 4)
invoice for retainage." The Court finds that none of the requirements
for payment of retainage under the contract have been met. Therefore,
there were no amounts due to be paid in pay application 16, and the Fire
District had reasonable cause to withhold payment for the retainage
payment in pay application 16. ( Footnote omitted.)
In seeking a writ of mandamus, Stevens Construction had the burden of
proving that the Fire District was arbitrary or without reasonable cause in not making
progressive stage payments under the contract; or failed to tender final payment
when due under the contract. As pointed out by the trial court, the valid provisions
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of the construction contract herein do not mandate payment under the circumstances
presented in this case and allow for discretion in payment when the provisions of the
contract are not met. The evidence submitted by joint stipulation included the
construction contract, pay applications submitted by Stevens Construction, and
letters from the Architect explaining the reasons for withholdings payment. In each
withholding the Architect listed what provision of the contract it was considering to
recommend that the payment not be made in whole or in part. After thorough review
of the record, as well as the trial court' s extensive written reasons, we find no
manifest error in the trial court' s finding that the Fire District was not arbitrary or
without reasonable cause in not making progressive stage payments under the
construction contract, or that the Fire District did not fail to tender final payment
when due under the construction contract. Accordingly, we find no abuse of
discretion by the trial court in denying Stevens Construction' s writ of mandamus.
CONCLUSION
For the foregoing reasons, the judgment of the trial court is affirmed. All costs
of the appeal are assessed to plaintiff-appellant, Stevens Construction & Design,
L.L. C.
AFFIRMED.
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