American Plumbing Co., Inc. v. Hadwin

483 So. 2d 169
CourtLouisiana Court of Appeal
DecidedJanuary 22, 1986
Docket17475-CA
StatusPublished
Cited by6 cases

This text of 483 So. 2d 169 (American Plumbing Co., Inc. v. Hadwin) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
American Plumbing Co., Inc. v. Hadwin, 483 So. 2d 169 (La. Ct. App. 1986).

Opinion

483 So.2d 169 (1986)

AMERICAN PLUMBING COMPANY, INC., Plaintiff-Appellee,
v.
John HADWIN, Defendant-Appellee,
Alan B. Boyd, Defendant-Appellant,
v.
Layla Restaurants, Inc., Defendant-Appellant.

No. 17475-CA.

Court of Appeal of Louisiana, Second Circuit.

January 22, 1986.
Rehearing Denied February 20, 1986.

*170 C.P. Brocato, Shreveport, for American Plumbing Co., Inc.

Robert A. Jahnke, Shreveport, for John Hadwin.

Samuel V. Prunty, Jr., Shreveport, for Alan B. Boyd and Layla Restaurants, Inc.

Before JASPER E. JONES, FRED W. JONES, Jr. and NORRIS, JJ.

JASPER E. JONES, Judge.

This litigation was instituted by American Plumbing Co., Inc., a subcontractor, seeking to recover for plumbing services it performed under a construction remodeling contract. The subcontractor sued the general contractor, John Hadwin, and the alleged sublessees of the property which was the subject of the remodeling contract, Alan Boyd and Layla Restaurants, Inc. Boyd and the corporation third partied Hadwin seeking indemnification for any judgment plaintiff obtained against them and damages for plaintiff's defective work. Hadwin third partied Boyd and Layla Restaurants, Inc. seeking the balance due him as contractor on the remodeling contract, which included the amount sought by the plumbing subcontractor. Appellants, Boyd and Layla Restaurants, Inc., appeal the trial court judgment holding them and John Hadwin solidarity liable for the plumbing bill and holding them solidarily liable unto Hadwin for work he performed under the contract based upon cost plus 10%. The Hadwin judgment against Boyd and the corporation provides a credit for any sums paid by them in the future on the judgment in favor of the plaintiff plumbing company. Hadwin, the appellee, has answered the appeal seeking to recover an additional sum for carpenter labor he performed.

The assignments of error made by the parties present three issues for decision:[1]

(1) did the trial court err in finding the parties entered into a cost plus contract; appellants contend the contract was for an agreed price which has been overpaid to Hadwin who, alone, owes the plumbing bill.
(2) did the trial court err in holding Boyd and Layla Restaurants, Inc. liable in solido unto John Hadwin for the balance due under the construction contract; and
(3) did the trial court err in refusing to award John Hadwin an additional fee for carpenter labor he performed.

FACTS

In early 1981, Boyd contacted Hadwin regarding the renovation and conversion of an existing building into a restaurant. After inspecting three locations over a period of approximately one year, a site on West Gate in Bossier City was chosen. Mrs. Layla Boyd, wife of Boyd, and her brother, Maher Bishara, formed Layla Restaurants, Inc. and leased the building on West Gate. *171 Hadwin met with plaintiff plumbing subcontractor and an electrical subcontractor at the job site and subsequently informed the Boyds and Maher Bishara that it would cost approximately $7,700.00 to bring the structure "up to code." The Boyds and Bishara testified that the $7,700.00 figure was the cost of the entire job. Hadwin testified that the $7,700.00 figure was an estimate of what it would cost to bring the building "up to code." He stated he accepted the remodeling contract job on a cost plus 10% basis. He testified that about the time work actually commenced that it was agreed by him and Boyd that he was to receive an amount each day that was equivalent to two hours of carpenter labor as additional compensation for his supervision of the remodeling contract. He does not articulate this part of his contract in brief, though the record establishes that this claim is included in the amount he claimed in the trial court and on appeal for carpenter labor. He also contends that he was to be paid regular carpenter labor for all carpenter work personally performed by him.

Hadwin subcontracted the plumbing work to American Plumbing Co., Inc. Hadwin submitted bills and invoices to Boyd as the work progressed. The invoices, at the request of Boyd, were charged in the name of Layla Restaurants, Inc. and the bills were paid by checks drawn upon that corporation's bank account. The total cost of materials, labor, and Hadwin's 10% fee reflected on the bills submitted to the corporation amounted to $17,190.67. This total included Hadwin's claim for $1,302.00 for his personal carpenter labor and supervision fee. The corporation paid Hadwin the total sum of $8,556.37 on the invoices submitted and refused to pay any further sums contending that Hadwin had agreed to perform the entire job for the sum of $7,700.00.

The trial court rendered judgment in favor of American Plumbing Co., Inc. and against Hadwin, Layla Restaurants, Inc., and Boyd, in solido, for the plumbing bill. Judgment was rendered in favor of Hadwin on his third party demand against Layla Restaurants, Inc. and Boyd, in solido, for the balance due under the cost plus contract. The trial court refused to award Hadwin the additional sum claimed for his carpenter labor which included the daily supervision fee equivalent to two hours of carpenter labor.

ISSUE # 1—COST PLUS CONTRACT

Boyd and Layla Restaurants, Inc. contend the trial judge erred in holding that the remodeling agreement was a cost plus contract. Appellants argue that they understood the $7,700.00 figure quoted by Hadwin was a firm price for the entire job. Hadwin contends the trial court was correct in holding that the parties agreed on a cost plus contract. He contends the $7,700.00 figure was nothing more than an estimate of what it would cost to bring the structure up to code.

The trial judge, in his reasons for judgment, held the parties entered into a cost plus 10% contract. The trial court denied Hadwin's claim for his personal carpenter work and supervision fee which was the amount of $1,302.00. The court found Hadwin entitled to $15,758.47 under the contract. The $8,556.37 which had been paid was deducted and judgment was rendered for the sum of $7,202.10 in favor of Hadwin and against Boyd and Layla Restaurants, Inc., in solido.

APPLICABLE LAW

In a cost plus percentage of the cost contract, the owner reimburses the contractor for the cost of the material and labor and the contractor's profit is to be a certain percentage of the total cost of the project. Standard Oil Company of La. v. Fontenot, 4 So.2d 634 (La.1941); Joe Bonura, Inc. v. Hiern, 419 So.2d 25 (La.App. 4th Cir.1982); Planning Systems Corp v. Murrell, 374 So.2d 719 (La.App. 4th Cir.1979) writ denied, 376 So.2d 319 and 377 So.2d 843 (La.1979).

When a contractor asserts a claim on a cost plus contract and the owner denies being indebted to the contractor, the contractor *172 has the burden of proving each item of expense in connection with the job and he must itemize each expenditure made by him. Planning Systems Corp. v. Murrell, supra.

The trial court found that the initial cost of the work discussed by the parties was $7,700.00. This figure was based upon estimates obtained by Hadwin made for the plumbing, electrical and carpenter work totaling $7,000.00, plus 10% as Hadwin's profit. The estimates were based primarily upon doing only work required to bring the restaurant into compliance with the current Bossier City building code. The estimates were made before the plans were submitted to Hadwin.

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Bluebook (online)
483 So. 2d 169, Counsel Stack Legal Research, https://law.counselstack.com/opinion/american-plumbing-co-inc-v-hadwin-lactapp-1986.