Louis and Stacey Pyle v. St. Joseph, LLC

NOT DESIGNATED FOR PUBLICATION
STATE OF LOUISIANA
COURT OF APPEAL
FIRST CIRCUIT
2021 CA 1003
LOUIS AND STACEY PYLE
VERSUS
ST. JOSEPH, LLC
JUN 1 ·4 2022'
Judgment Rendered:- - - - - -, 2022
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Appealed from the 22"d Judicial District Court
In and for the Parish of St. Tammany
State of Louisiana
Case No. 2019-13329
The Honorable August J. Hand, Judge Presiding
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Laurie M. Pennison Counsel for Plaintiffs/Appellees
Mandeville, Louisiana Louis and Stacey Pyle
Ralph S. Whalen, Jr. Counsel for Defendant/Appellant
New Orleans, Louisiana St. Joseph, LLC
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LANIER, J.
The defendant, St. Joseph, LLC (St. Joseph), appeals a partial summary
judgment of the Twenty-Second Judicial District Court granted in favor of the
plaintiffs, Louis and Stacey Pyle. For the following reasons, we reverse and
remand.
FACTS AND PROCEDURAL HISTORY
On May 30, 2018, the Pyles and St. Joseph entered into a contract for the
construction of a home in Abita Springs, Louisiana. In the contract, St. Joseph
agreed to build a private residence for the Pyles. Article 3, subpart 3.1 of the
contract provided that the Pyles would pay St. Joseph the sum of $313,310.82,
subject to additions and deductions provided for in the contract documents, 1 plus a
contractor fee of$34,244.00. The total contract price was $347,554.82.
Subpart 3.2 of the contract specified that the contract price was based on
allowances for materials. Subpart 7.1 stated that when the costs of items were
more than or less than the allowances, the contract sum would be adjusted
accordingly by a written change order prior to ordering and installing the items.
During construction, the Pyles requested a change order via email, and a price
quote was submitted by St. Joseph. Due to this change and other changes, the Pyles
contend that they paid $41, 106.62 in addition to the total contract sum.
Upon the house's completion but before a certificate of occupancy was
granted, St. Joseph invoiced the Pyles for $111,345.91, and filed a statement of
1
Subpart 6.1 of the contract lists the contract documents as:
this Agreement, Drawings, Specifications, Selection Sheets, Estimated Cost
Analysis, addenda issued prior to the execution of this Agreement, other
documents listed in this Agreement and only written modifications issued after
execution of this Agreement which have been signed or initialed by both the
[Pyles] and [St. Joseph.] There are no agreements between the parties other than
the Contract Documents and no oral agreements exist between the parties.
2
lien and privilege in the conveyance records of St. Tammany Parish on May 16,
2019. 2 A copy of the lien was forwarded to the Pyles on June 25, 2019. St. Joseph
explained that it had incurred additional labor costs during the construction, and
that the contract was a "cost-plus" contract, entitling St. Joseph to recover overages
attributable to the increases in the cost of construction. The Pyles, however,
claimed that the contract was a "lump sum" contract with a fixed amount, which
they paid. The Pyles claimed that the additional $41,106.62 they paid for
allowance changes was not included in the invoice submitted by St. Joseph.
The Pyles filed a petition for declaratory judgment and breach of
contract/breach of warranty pursuant to Louisiana's New Home Warranty Act
(NHWA), La. R.S. 9:3141 et seq., on July 3, 2019. St. Joseph filed an answer and
reconventional demand on October 14, 2019, in which it claimed: the contract was
a cost-plus contract made evident by the contract's language; the Pyles had
requested numerous revisions and additions, which significantly modified the cost
and scope of the entire project; the Pyles had breached the contract in bad faith by
refusing to pay the outstanding balance; that St. Joseph relied on the Pyles'
representations regarding the design documents to its detriment; and that the Pyles
were unjustly enriched by the work done by St. Joseph.
The Pyles filed a motion for partial summary judgment on April 13, 2020.
In their supporting memorandum, the Pyles asserted that the contract was a lump
sum contract; therefore, St. Joseph could not charge additional costs, and the lien
St. Joseph filed should be cancelled. The Pyles also requested all court costs and
attorney fees associated with removal of the lien be paid by St. Joseph.
In its review of the motion for partial summary judgment, the trial court
found the contract to be a lump sum contract. In a judgment signed November 17,
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The Pyles' petition and the statement oflien and privilege filed by St. Joseph show the total
invoiced amount as $122,756.11.
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2020, the trial court granted the Pyles' motion for partial summary judgment,
ordered the lien filed by St. Joseph to be cancelled, and awarded costs and attorney
fees to the Pyles. 3 St. Joseph timely appealed. 4
ASSIGNMENTS OF ERROR
St Joseph raises the following assignments of error:
1. The trial court erred in granting a partial summary judgment where there
were contested facts.
2. The trial court erred in holding the contract in question was a lump sum
contract.
ST AND ARD OF REVIEW
The standard of review for the granting of a partial summary judgment is de
novo. Spanish Lake Wildlife Refuge & Botanical Gardens, Inc. v. Parish of
Ascension ex rel. Martinez, 2011-1882 (La. App. 1 Cir. 5/4/12), 2012WL1580760,
*3 (unpublished), writ denied, 2012-1677 (La. 11/2/12), 99 So.3d 671. Summary
judgments are favored by the courts as a procedure to secure a "just, speedy, and
inexpensive determination." La. C.C.P. art. 966(A)(2). Summary judgment shall
be granted "if the motion, memorandum, and supporting documents show that
there is no genuine issue as to material fact and that the mover is entitled to
judgment as a matter of law." La. C.C.P. art. 966(A)(3).
"[I]f the mover will not bear the burden of proof at trial on the issue that is
before the court ... , the mover's burden on the motion does not require him to
3
On December 16, 2020, St. Joseph liled an ex parte consent motion for designation of the
judgment as final pursuant to La. C.C.P. art. 1915(B)(l). On December 18, 2020, the trial court
signed an order designating the judgment as final pursuant to La. C.C.P. art. 1915(B)(l) and
made the express determination that there was no just reason for delay.
4
A Show Cause Order was issued by this court in reference to the November 17, 2020 judgment
on appeal because, although the judgment ordered the "Statement of Lien" filed by St. Joseph to
be cancelled, the lien itself was not attached to the judgment, and because the attorney fee award
was uncertain. On February 10, 2022, the record was supplemented with an amended judgment
signed by the trial court on January 12, 2022, which attached the referenced lien and awarded a
definite amount of attorney fees. Thus, on March 4, 2022, we maintained the appeal.
4
negate all essential elements of the adverse party's claim, action, or defense[.]" Id.Rather, the movant must "point out to the court the absence of factual support for
one or more elements essential to the adverse party's claim, action, or defense."
Id. Thereafter, if the adverse party fails to produce factual support sufficient to
establish that he wi II be able to satisfy his evidentiary burden of proof at trial, there
is no genuine issue of material fact. See Id.DISCUSSION
Contracts have the effect of law for the parties and the interpretation of a
contract is the determination of the common intent of the parties. See La. C.C.
arts. 1983 and 2045; Clovelly Oil Co., LLC v. Midstates Petroleum Co., LLC,
2012-2055 (La. 3/19/13), 112 So.3d 187, 192. The reasonable intention of the
parties to a contract is to be sought by examining the words of the contract itself,
and not assumed. When the words of a contract are clear and explicit and lead to
no absurd consequences, no further interpretation may be made in search of the
parties' intent. La. C.C. art. 2046; Clovelly Oil, at 192. Common intent is
determined, therefore, in accordance with the general, ordinary, plain and popular
meaning of the words used in the contract. La. C.C. art. 2047; Clovelly Oil, at 192.
Accordingly, when a clause in a contract is clear and unambiguous, the letter of
that clause should not be disregarded under the pretext of pursuing its spirit, as it is
not the duty of the courts to bend the meaning of the words of a contract into
harmony with a supposed reasonable intention of the parties. La. C.C. art. 2046;
Clovelly Oil, at 192.
However, even when the language of the contract is clear, courts should
refrain from construing the contract in such a manner as to lead to absurd
consequences. La. C.C. art. 2046; Clovelly Oil, at 192. Most importantly, a
contract must be interpreted in a common-sense fashion, giving the words of the
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contract their common and usual significance. La. C.C. art. 2047; Clovelly Oil, at
192. Moreover, a contract provision that is susceptible to different meanings must
be interpreted with a meaning that renders the provision effective, and not with one
that renders it ineffective. La. C.C. art. 2049; Clovelly Oil, at 192. Each provision
in a contract must be interpreted in light of the other provisions so that each is
given the meaning suggested by the contract as a whole. La. C.C. art. 2050;
Clovelly Oil, at 192.
The Pyles submitted the contract m support of their motion for partial
summary judgment. The contract is titled "New Residential Construction
Agreement Contract between Owner and Contractor." It states m Article 1,
subpart 1.2 that the contract is predicated on the Pyles receiving a loan from
Hancock Bank in the amount of $350,000.00. Article 3, titled "Contract Sum,"
states in subpart 3.1 "[The Pyles] shall pay [St. Joseph] ... the estimated sum of
THREE HUNDRED THIRTEEN THOUSAND THREE HUNDRED TEN And
Eighty Two Cents ($313,310.82) subject to additions and deductions as provided in
the Contract Documents. PLUS CONTRACTOR FEE OF THIRTY FOUR
THOUSAND TWO HUNDRED FORTY FOUR ($34,244.00)."
The Pyles also submitted St. Joseph's written estimate/bid for the project. In
that bid, St. Joseph characterized the estimate as a "lump sum." While the term
"lump sum" is not used in the contract itself, it clearly states that the Pyles agreed
to pay a definite sum of money to St. Joseph, which was subject to certain
additions and deductions. A clear and definite contractor fee was also included.
Article 3, subpart 3.2 further specified that "[a]ny increase to [St. Joseph's] labor
cost due to the [Pyles'] decision to increase or otherwise modify any particular
allowances shall be borne by [the Pyles]. A change in material cost of the same
type will not cause an increase in labor costs."
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Article 7, titled "Allowances & Selections," states in subpart 7 .1 that
"[w]henever the costs are more than or less than allowances, the Contract Sum
shall be adjusted accordingly by Written Change Order prior to ordering or
installing said items." This language further evidences the parties' ability to vary
the contract sum upon completion. In Article 12, titled "Changes in the Work,"
subpart 12.1 states that "[t]he [Pyles] ... may order changes in the Work consisting
of additions, deletions or modifications, the Contract Sum . . . being adjusted
accordingly." Therefore, in more than one article in the contract it is established
that the Pyles agreed to pay an initial sum of money to St. Joseph in consideration
of St. Joseph constructing their new home, but that sum was subject to
modification at any time based on any written change order agreed upon between
the parties.
It is unclear from the record how the contract was modified by written
change orders. The Pyles claim in their petition that they paid St. Joseph
$41,106.62 for changes they requested to be made to the project. Attached to the
contract is a Cost Analysis Estimate dated May 30, 2018. Of the items included on
this estimate, any marked with an asterisk are "allowances, prices slightly subject
to change, or unsure of vendor." The marked items are "Sitework" priced at
$9,000.00, "Concrete" priced at $26,000.00, "Tile" priced at $3,200.00, "Roofer"
priced at $5,200.00, and "Culvert," which has no listed price, but contains the note
"Unsure how to price since city provides service. To be added once
paid/completed." The "Contractor Fee, Profit, Overhead, Transportation, Etc." is
also marked with an asterisk, and the indicated price is $34,244.00. Next to the
price is the note "Fee will not change unless significant change order is made."
Also attached is an exhibit that Mr. Pyle attested is a written change order for the
carport hangover, totaling $3,544.58. Also submitted is what the Pyles claim is an
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invoice totaling $8,790.00 for a change order related to air conditioning and
heating, but we note this does not appear to be the actual written change order.
The Pyles also introduced St. Joseph's invoice totaling $111,345.91. The
invoice itemizes the costs of all material and labor through each phase of
construction. There are several notes indicating overages due to extra
work/material that was needed due to requests by the Pyles. Several items are
marked by asterisks, which may indicate allowances or change orders. The final
project total is $463,410.73. The Pyles' payment of $337,554.81 is subtracted
from the total, along with $14,510.00, which is listed as "Owed from Hancock
Whitney." What St. Joseph indicates as "Owed From Louis & Stacey Pyle" is
$111,345.91. 5
The documents submitted by St. Joseph in opposition to the motion for
partial summary judgment indicate that the Pyles had made a large number of
requests during the course of the construction that can be considered change
orders, and St. Joseph had submitted invoices to verify the costs of those changes.
Although we are unable to verify from the Pyles' exhibits the $41,106.62 in
changes and allowances they claim to have paid to St. Joseph, and although St.
Joseph's claim of $111,345.91 is substantiated by its invoice to the Pyles,
credibility issues have no place in the summary judgment procedure. See Revere v.
Dolgencorp, Inc., 2004-1758 (La. App. 1Cir.9/23/05), 923 So.2d 101, 107.
St. Joseph has shown, via evidence of outstanding disputed amounts, that
there is a genuine issue of material fact as to whether the contract is a lump sum
contract. Therefore, the lien must remain in effect until the issue of the disputed
contract amount is resolved. See 225 Baronne Complex, LLC v. Roy Anderson
Corp., 2016-0492 (La. App. 4 Cir. 12/14/16), 2016WL7238975, *8 (unpublished),
5
The final calculation should be $111,345.92.
8
writ denied, 2017-0326 (La. 4/7/17), 218 So.3d 116 (trial court committed error in
cancelling lien, where a sum of money may be owed to the lienholder).
As we find that there are disputed issues of fact regarding the change orders
and their amounts, the partial summary judgment must be reversed and remanded
for further proceedings. Until those disputed amounts and the disposition of the
lien are resolved, the issue of whether the contract is a lump sum contract is
prematurely before us. Therefore, we pretermit discussion on the nature of the
contract.
DECREE
The January 12, 2022 partial summary judgment of the Twenty-Second
Judicial District Court in favor of the appellees, Louis and Stacey Pyle, is reversed.
We remand this matter for further proceedings consistent with this opinion. All
costs of this appeal are assessed to Louis and Stacey Pyle.
REVERSED AND REMANDED.
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