City of Shreveport v. SGB Architects, L.L.P.

47 So. 3d 1105, 2010 La. App. LEXIS 1245, 2010 WL 3663274
CourtLouisiana Court of Appeal
DecidedSeptember 22, 2010
Docket45,458-CA
StatusPublished

This text of 47 So. 3d 1105 (City of Shreveport v. SGB Architects, L.L.P.) 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
City of Shreveport v. SGB Architects, L.L.P., 47 So. 3d 1105, 2010 La. App. LEXIS 1245, 2010 WL 3663274 (La. Ct. App. 2010).

Opinion

WILLIAMS, J.

1 jThe defendant, SGB Architects, L.L.P., appeals a partial summary judgment in favor of third-party defendant, Tetra Tech, Inc. (“Tetra”). The district court found that Tetra’s liability, if any, to defendant for damages could not exceed the amount of $2,860, pursuant to the limitation of liability provision in the parties’ contract. For the following reasons, we affirm.

FACTS

In April 1997, the City of Shreveport (“the City”) retained SGB Architects, L.L.P. (“SGB”) to design a new community center at David Raines Park (herein referred to as the Center or Project). In September 1998, SGB signed a contract with Tetra (known at the time as Maxim Technologies, Inc.). Under the contract, Tetra agreed to perform tests of subsurface soil samples and prepare a report with recommendations for the foundation design of the Center, in return for compensation of $2,860. The two-sided contract, naming SGB as “Client,” was signed on the front side by Clarence Babineaux, a partner of SGB, and Lloyd Hoover, a manager of Tetra. Printed below the signature lines was a statement, “By signing this Agreement, Client assents to the terms and conditions set forth above and on the reverse side hereof.” Among the provisions contained on the reverse side of thé contract, Paragraph 10 states:

*1107 Limitation of Liability. Client hereby agrees, to the fullest extent permitted by law, that Consultant’s total liability to Client for any and all injuries, claims, losses, expenses or damages whatsoever arising out of or in any way related to the Project or this Agreement, from any cause or causes, including but not limited to, Consultant’s negligence, errors, omissions, strict liability, breach of contract, or otherwise, will not exceed (i) the total compensation received by Consultant under the Agreement, or (ii) $50,000, whichever is the lesser amount.

|2On October 16, 1998, Tetra issued its subsurface exploration report, which was part of the information used by SGB in preparing the plans and specifications for construction of the Center. In January 2001, the Center was substantially completed, but later that year problems with vertical movement of the floor slab were discovered when the front entry doors began to stick and the lobby floor became uneven.

In November 2005, the City filed a petition for damages against the defendants, SGB, its insurer, Lafayette Insurance Company, and Melvin Butler, Inc., the general contractor for the Project. SGB then filed a third party demand alleging that Tetra was negligent in performing the soil tests and in recommending a foundation design. In March 2007, Tetra filed a motion for summary judgment seeking dismissal of SGB’s claims and SGB filed an opposition. Subsequently, the district court denied Tetra’s motion.

In June 2009, Tetra filed a motion for partial summary judgment on the grounds that the parties’ contract limited Tetra’s liability to SGB for any damages arising out of the Project to an amount not exceeding $2,860. SGB filed an opposition to partial summary judgment, alleging that it had never agreed to the liability limitation provision in the contract.

After a hearing, the district court granted partial summary judgment in favor of Tetra, finding that the contractual provision limiting liability was not ambiguous. The court rendered judgment ordering that Tetra’s liability, if any, for damages arising out of the contract with SGB shall not exceed the amount of $2,860. The district court designated the judgment as a final, appealable judgment under LSA-C.C.P. art. 1915(B). SGB appeals the | judgment.

DISCUSSION

SGB contends the district court erred in granting Tetra’s motion for partial summary judgment. SGB argues that a material issue of fact exists as to whether SGB agreed to be bound by the provisions contained on the reverse side of the contract because SGB did not initial that side of the document.

Summary judgment shall be granted if the pleadings, depositions, admissions and any affidavits show that there is no genuine issue of material fact and the mover is entitled to judgment as a matter of law. LSA-C.C.P. art. 966(B). Appellate courts review summary judgments de novo under the same criteria that govern the district court’s consideration of the appropriateness of summary judgment. King v. Parish National Bank, 04-0387 (La.10/19/04), 885 So.2d 540. The mover has the initial burden of proving that no genuine issue of material fact exists. If the mover makes a prima facie showing in support of the motion, then the burden shifts to the nonmov-ing party to present evidence demonstrating that a material fact issue remains. Jones v. Estate of Santiago, 03-1424 (La.4/14/04), 870 So.2d 1002.

*1108 A contract is an agreement by-two or more parties whereby obligations are created, modified, or extinguished. LSA-C.C. art. 1906. Under Louisiana law, the formation of a valid and enforceable contract requires capacity, consent, a certain object and lawful cause. Worley v. Chandler, 44,047 (La.App.2d Cir.3/4/09), 7 So.3d 38. Ordinarily, the |4meaning and intent of the parties to a written instrument should be determined within the four corners of the document and its terms cannot be explained or contradicted by extrinsic evidence. Scott v. Red River Waterway Commission, 41,009 (La.App.2d Cir.4/12/06), 926 So.2d 830. A person who signs a written instrument is presumed to know its contents and cannot avoid its obligations by contending that he did not read it, or that it was not explained or that he did not understand its terms. First South Farm Credit, ACA v. Gailliard Farms, Inc., 38,731 (La.App.2d Cir.8/18/04), 880 So.2d 223.

In the present case, SGB argues that it is not bound by the liability limitation because it did not initial the reverse side of the contract. However, the contract does not require that SGB initial the reverse side of the document in order to be bound by the limitation of liability provision. Rather, the statement printed below the signature line advised SGB that by “signing” the agreement, SGB agreed to the terms set forth on both sides of the contract. The two cases cited in SGB’s brief to support its position involved the at-will employment relationship, which is not an issue in this case. The evidence submitted supports a determination that SGB signed the agreement and was bound by all of the terms contained in the contract.

SGB also contends the district court erred in finding that the contract language was unambiguous. SGB argues that the contract should be interpreted as not limiting Tetra’s liability because the language of paragraph 8 regarding the availability of Tetra’s professional liability insurance coverage is inconsistent'with the liability limitation provision.

IsThe interpretation of a contract is the determination of the common intent of the parties. LSA-C.C. art. 2045. When the words of a contract are clear and explicit and do not result in absurd consequences, no further interpretation may be made in search of the parties’ intent. LSA-C.C. art. 2046. The words of a contract must be given their generally prevailing meaning.

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Related

Scott v. Red River Waterway Commission
926 So. 2d 830 (Louisiana Court of Appeal, 2006)
Worley v. Chandler
7 So. 3d 38 (Louisiana Court of Appeal, 2009)
King v. Parish National Bank
885 So. 2d 540 (Supreme Court of Louisiana, 2004)
First South Farm Credit v. GAILLIARD FARMS
880 So. 2d 223 (Louisiana Court of Appeal, 2004)
Jones v. Estate of Santiago
870 So. 2d 1002 (Supreme Court of Louisiana, 2004)

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Bluebook (online)
47 So. 3d 1105, 2010 La. App. LEXIS 1245, 2010 WL 3663274, Counsel Stack Legal Research, https://law.counselstack.com/opinion/city-of-shreveport-v-sgb-architects-llp-lactapp-2010.