Calcasieu Parish School Board v. Lewing Construction Co., Inc.

Opinion

STATE OF LOUISIANA COURT OF APPEAL, THIRD CIRCUIT

05-928

CALCASIEU PARISH SCHOOL BOARD

VERSUS

LEWING CONSTRUCTION CO., INC. ET AL

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ON REMAND FROM THE LOUISIANA SUPREME COURT

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APPEAL FROM THE FOURTEENTH JUDICIAL DISTRICT COURT, PARISH OF CALCASIEU, NO. 2002-4241 HONORABLE D. KENT SAVOIE, DISTRICT JUDGE

********** J. DAVID PAINTER JUDGE ********** Court composed of Ulysses Gene Thibodeaux, Chief Judge, Jimmie C. Peters, and J. David Painter, Judges.

REVERSED IN PART; AFFIRMED IN PART.

Joseph A. Delafield 3401 Ryan St., Ste. 307 Lake Charles, LA 70606 Attorney for Defendant-Appellant: Lewing Construction Co., Inc.

Michael G. Gaffney Nolan P. Lambert 631 St. Charles Ave. New Orleans, LA 70130 Attorney for Defendant-Appellant-Appellee: D & T Tile and Terrazzo, Inc.

Kraig T. Strenge P.O. Drawer 52292 Lafayette, LA 70502 Attorney for Third Party Defendant-Appellant-Appellee: Lafayette Insurance Co. PAINTER, Judge.

This matter1 is before us on remand from the Louisiana Supreme Court for

reconsideration in light of that court’s decision in Supreme Services and Specialty

Co., Inc. v. Sonny Greer, Inc., 06-1827 (La. 5/22/07), 958 So.2d 634. The only

determination made in the original opinion in this matter that is affected by the

Supreme Services decision is this court’s finding that the policy of insurance issued

by Lafayette Insurance Company (Lafayette) to D & T Tile and Terrazzo, Inc. (D &

T) did provide coverage for the failure of the floor installed by D & T at R. W.

Vincent Elementary School. Therefore, we will consider this determination in light

of the Supreme Services case.

In its appeal to this court, Lafayette assigned as error the trial court’s

determination that its policy provided D & T with coverage for the situation at issue.

Lafayette argued that its policy excluded coverage for claims rising out of the quality

of the insured’s work, cited a policy exclusion for improperly performed work, and

an exclusion for “‘property damage’ to ‘your product’ arising out of it or any part of

it,” and “‘property damage’ to ‘your work’ arising out of it.” However, after

reviewing the policy, we found that the failure of the floor was covered under the

“Products-Completed Operations” coverage. We noted that while the policy referred

to that coverage, there was no separate endorsement or rider which specifically

described that coverage. However, the declarations sheet of the policy showed that

the coverage existed. Further, the policy stated that:

14.a. “Products-completed operations hazard” includes all “bodily injury” and “property damage” occurring away from premises you own or rent and arising out of “your product” or “your work” except:

1 This court previously considered this case in Calcasieu Parish School Board v. Lewing Construction Co., Inc., 05-928, (La.App. 3 Cir 5/31/06, 931 So.2d. 492. (1) Products that are still in your physical possession; or

(2) Work that has not yet been completed or abandoned.

....

17. “Your product” means:

a. Any goods or products, other than real property, manufactured, sold, handled, distributed or disposed of by:

(1) You;

....

19. “Your work” means:

a. Work or operations performed by you or on your behalf; and b. Material, parts or equipment furnished in connection with such work or operations.

In our previous consideration of this case, we found that the policy purported

to “both provide coverage for ‘products-completed operations hazard’ and apparently

to exclude coverage of the same,’” under a “work-product” exclusion for improperly

performed work. As a result, we interpreted the policy to provide coverage for the

claims made against D & T.

While this court feels that its reasoning in the original opinion herein is correct,

we are required to apply the finding of the supreme court in Supreme Services, 958

So.2d 634. In that case, the supreme court found that:

[U]nder the “work product” exclusion, the insured or its subcontractor becomes liable for damages to its work or its product caused by its faulty workmanship. Under the [products-completed operations hazard] provision, damages, other than the faulty product or work itself, arising out of the faulty workmanship are covered by the policy.

Id. at 645.

The Plaintiff claimed damages against D & T for: (i) removal of the epoxy terrazzo floor, (ii) reimbursement of sums expended for expert investigation of the cause of the ooze and emission of the oily substance, (iii) reimbursement for sums expended for remediation, removal and cleaning of the oily substance, and (iv) reimbursement for sums expended for safeguarding and efforts to prevent damage and injury to students, faculty, staff and visitors to the R. W. Vincent Elementary School.

Because the claims against D & T are for the faulty product/work, we must apply the

supreme court’s ruling in Supreme Services and rule that they fall under the work

product exclusion.

Therefore, that portion of the trial court judgment finding that the Lafayette

policy provided coverage for the claims made against D & T is reversed. Judgment

is rendered finding that the Lafayette policy excludes coverage for the claims made

against D & T. The assessment of attorney’s fees against Lafayette is overturned.

Our assessment of trial costs to Lafayette is also reversed. Costs t the trial level are

to be paid equally by D & T and Key Resin. Costs on appeal are to be divided

between Key Resin and D & T. Our previous judgment in this case will not be

disturbed in any other respect.

REVERSED IN PART; AFFIRMED IN PART.