Certified Cleaning & Restoration, Inc. v. Lafayette Insurance Co.

96 So. 3d 1248, 10 La.App. 5 Cir. 948, 2012 WL 1957557, 2012 La. App. LEXIS 746
CourtLouisiana Court of Appeal
DecidedMay 31, 2012
DocketNo. 10-CA-948
StatusPublished
Cited by3 cases

This text of 96 So. 3d 1248 (Certified Cleaning & Restoration, Inc. v. Lafayette Insurance Co.) 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
Certified Cleaning & Restoration, Inc. v. Lafayette Insurance Co., 96 So. 3d 1248, 10 La.App. 5 Cir. 948, 2012 WL 1957557, 2012 La. App. LEXIS 746 (La. Ct. App. 2012).

Opinion

MARC E. JOHNSON, Judge.

| ¡>This matter was remanded to this Court by the Louisiana Supreme Court for the limited purpose of having us clarify our previous ruling regarding any contract claims raised by appellants, the Doucets and Lafayette Insurance Company.

In our initial opinion, we found the trial court erred in finding the Doucets and Lafayette Ins. Co. liable under the theories of vicarious liability and negligent hiring. As such, we reversed that portion of the trial court’s April 30, 2010 judgment finding the Doucets vicariously liable for the negligence of Gammon and independently liable for hiring Gammon. We concluded that this finding made it unnecessary to address the last issue raised by appellants relating to a mutual waiver provision in the lease contract. Certified Cleaning & Restoration, Inc. v. Lafayette Ins. Co., 10-948 (La.App. 5 Cir. 6/14/11), 67 So.3d 1277. The Supreme Court disagreed and remanded this matter for us to address the contract issue.

In their appellant brief, the Doucets and Lafayette Ins. Co. scantly argue, without one citation of legal authority, that there is a mutual waiver clause in the please contract between Mr. Doucet and the Turf Club that precludes liability for the damage caused by the fire and which applies to The Edge as a sub-lessee. Appellants contend that under the mutual waiver clause, Mr. Doucet and the Turf Club waived all claims against each other for any loss arising out of damage or destruction of the leased premises which was or could have been insured under a standard fire policy. Appellants further assert each party agreed to insure themselves for their own risks and to obtain a waiver of subrogation from their respective underwriters in favor of the other. Appellees, Certified Cleaning and Underwriters, respond that the contract is ambiguous and, thus, , should be construed against the Doucets for waiver of liability.

In its judgment, the trial court found Certified Cleaning was legally subrogated to The Edge’s contract rights against the [1250]*1250Doucets and their insurer, Lafayette Ins. Co., under La. C.C. art. 1826 for Certified Cleaning’s performance of the Doucets’ obligation under the lease to maintain the roof and to repair fire, smoke, and water damage. The trial court found the remediation services provided by Certified Cleaning were covered under the general commercial coverage and property coverage of Lafayette Ins. Co.’s policy issued to the Doucets. Thus, the trial court determined the Doucets and Lafayette Ins. Co. were liable to Certified Cleaning, in solido with The Edge and Gammon, in the amount of $45,992.59.

Additionally, the trial court found Underwriters, The Edge’s insurer, was subro-gated to the rights of The Edge for money Underwriters paid under the insurance policy it issued to The Edge for loss caused by the fire. The trial court concluded that the Doucets were contractually obligated under the lease to maintain the roof, promptly make any repairs due to fire, and to maintain fire insurance on the property, which they did through Lafayette Ins. Co. The trial court determined the policy issued by Lafayette Ins. Co. to the Doucets covered the | ^damages paid by Underwriters to The Edge. As such, the trial court found the Doucets and Lafayette Ins. Co. liable to Underwriters in the amount of $47,775.17.

The trial court also found the Doucets and Lafayette Ins. Co. liable to the Edge in the amount of $90,680.48 for property damage it suffered as a result of the fire and which was not paid by its insurer. The trial court did not indicate whether this amount was based on contractual liability under the lease or on the vicarious liability and independent negligence of the Doucets, which we reversed in our initial opinion.

Paragraph 10 of the lease contract between the Doucets and the Turf Club provides in pertinent part, “Any sub-lessee occupying any part of this space, shall buy [sic] the act of subletting formally or informally, assume all obligations of Lessee, whether or not Lessor knew of or approved or disapproved of such sub-letting.” Thus, the provisions of the lease apply to The Edge, as a sublessee.

Under the lease, the Doucets were responsible for maintaining the roof and were obligated to repair the premises in the event the premises were damaged by fire. The Doucets were also required to maintain fire insurance on improvements in and on the premises, except removable installations which the lessee would be permitted to remove at the expiration of the lease. As lessee, The Edge was required to maintain a general liability insurance policy covering property damage to the leased premises.

The lease also contained a subrogation clause, which stated:

28. SUBROGATION: Neither the Lessor nor the Lessee shall be liable to the other for the loss arising out of damage to or destruction of the leased premises, or the building or improvements of which the leased premises are a part thereof, when such lost [sic] is caused by any of the perils which are or could be included within or are insured against by a standard form of fire insurance with extended coverage, including sprinkler leakage insurance, if any. All such claims for any and all loss, however caused, hereby are waived. Said absence of liability shall exist whether or not the damage or destruction is caused |fiby the negligence of either lessor or I r [sic] by any of their respective agents, servants or employees. It is the intention and agreement of the Lessor and the Lessee that the rentals reserved by this lease have been fixed in contemplation that each party shall fully provide [1251]*1251his own insurance protection at his own expense, and that each party shall look to his respective insurance carriers for reimbursement of any such 1038 [sic], and further, that the insurance carriers involved shall not be entitled to subrogation under any circumstances against any party to this lease. Neither the Lessor nor the Lessee shall have any interest or claim in the other’s insurance policy or policies, or the profit thereof, unless specifically covered therein as a joint assured.

It is this paragraph upon which the Dou-cets rely to support their position that the parties mutually waived their right to sub-rogation and, thus, the trial court erred in finding them liable to Certified Cleaning and Underwriters.

Louisiana Civil Code article 1825 defines subrogation as “the substitution of one person to the rights of another.” A subrogee can have no greater rights than those possessed by its subrogor and is subject to all limitations applicable to the original claim of the subrogor. Gray Ins. Co. v. Old Tyme Builders, Inc., 03-1136 (La.App. 1 Cir. 4/2/04), 878 So.2d 603, 607; Orgeron v. Prescott, 93-926 (La.App. 5 Cir. 4/14/94), 636 So.2d 1033, 1042. Therefore, the rights of Certified Cleaning and Underwriters against the Doucets depend on the interpretation of the subrogation clause.

A lease is a contract between the parties. La. C.C. art. 2668. A contract must be interpreted in light of the common intent of the parties. La. C.C. art. 2045. If 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. Each provision of 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.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

JIB Line Group, LLC v. Legette
165 So. 3d 93 (Louisiana Court of Appeal, 2014)
Grady v. Choices of Louisiana, Inc.
138 So. 3d 42 (Louisiana Court of Appeal, 2014)

Cite This Page — Counsel Stack

Bluebook (online)
96 So. 3d 1248, 10 La.App. 5 Cir. 948, 2012 WL 1957557, 2012 La. App. LEXIS 746, Counsel Stack Legal Research, https://law.counselstack.com/opinion/certified-cleaning-restoration-inc-v-lafayette-insurance-co-lactapp-2012.