Hemenway Co., Inc. v. Bartex, Inc. of Texas

373 So. 2d 1356, 1979 La. App. LEXIS 2785
CourtLouisiana Court of Appeal
DecidedJuly 16, 1979
Docket12701
StatusPublished
Cited by18 cases

This text of 373 So. 2d 1356 (Hemenway Co., Inc. v. Bartex, Inc. of Texas) 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
Hemenway Co., Inc. v. Bartex, Inc. of Texas, 373 So. 2d 1356, 1979 La. App. LEXIS 2785 (La. Ct. App. 1979).

Opinion

373 So.2d 1356 (1979)

HEMENWAY COMPANY, INC.
v.
BARTEX, INC. OF TEXAS, et al.

No. 12701.

Court of Appeal of Louisiana, First Circuit.

July 16, 1979.
Rehearing Denied August 28, 1979.

*1357 Eugene R. Preaus, New Orleans, of counsel, for plaintiff-appellee, Hemenway Co., Inc.

Joseph F. Keogh, Baton Rouge, of counsel, for defendant-appellant, Bartex, Inc., of Texas.

Before CHIASSON, EDWARDS and COLE, JJ.

EDWARDS, Judge.

This suit arises out of disputes between plaintiff, Hemenway Company, Inc., and defendants, Bartex, Inc. of Texas (a/k/a Bartex, Inc.) and its surety, Highlands Insurance Company, regarding the construction of Hemenway's furniture store in Baton Rouge. After trial on the merits, the trial court rendered judgment in favor of Hemenway in the amount of $70,724.93 as damages for the untimely completion of the project and for defects in the construction. Additionally, the judgment awarded Bartex the sum of $43,534.13 on its reconventional demand as the balance due on the contract plus the cost of certain change orders. Defendants appealed the award in favor of Hemenway.

On January 22, 1973, Hemenway, as owner, and Bartex, as contractor, entered into a written contract for the construction of a new retail furniture facility for Hemenway in Baton Rouge. The contract inter alia provided a completion date of June 15, 1973. To allow the lender to perfect its mortgage lien, this contract was cancelled by mutual agreement of the parties on February 20, 1973. Thereafter, on March 2, 1973, the parties entered into another written construction contract identical to the January 22, 1973, contract. Again, the contract called for a completion date of June 15, 1973.

Highlands issued a private works bond in the amount of $556,700 on March 2, 1973, for the performance of the work undertaken by Bartex. The bond was attached to and made a part of the construction contract of March 2, 1973.

The building was not completed by the date stated in the contract, June 15, 1973.

*1358 In fact, the building was not occupied until March 20, 1974. Thereafter, Hemenway filed an acceptance dated May 17, 1974, asserting that the building was substantially complete.

On appeal, defendants assign the following errors allegedly committed in the trial court:

1. "The Honorable Trial Judge erred in allowing Hemenway, Inc., to prove its actual damages sustained by the alleged delay of Bartex, since the written contract between Hemenway, Inc., and Bartex, Inc., contained its own specific provisions with regard to damages for delay."

2. "Assuming for the sake of argument that Hemenway should be allowed to claim actual damages for alleged delay, the Honorable Trial Judge erred in finding that Bartex was entitled to no extension of the contract deadline beyond October 7, 1973."

3. "The Honorable Trial Judge erred in awarding Hemenway both the rental on its old facility and the interim interest on its new facility as items of pure damage, since this results in an unjust enrichment of Hemenway at Bartex's expense."

4. "The Honorable Trial Judge erred in awarding Hemenway the sum of $2,062.64 as damages for `loss of use' of a stock picker as Hemenway was acquiring an ownership equity in such item and its economic life was not shortened by such delay."

5. "The Honorable Trial Judge erred in allowing Hemenway, Inc., damages for the alleged defects in the building since Hemenway had unconditionally accepted the premises."

6. "The Honorable Trial Judge erred in awarding Hemenway the sum of $16,000.00 for alleged defects in the parking lot."

1.

The construction contract provided in Article 2:

"Time of Completion—The completion date for this project is established as not later than June 15, 1973 and liquidated damages of subject to a further and separate agreement to be executed within 15 days ($ ) per day shall be assessed for every calendar day beyond that date. Extensions of time shall be made in accordance with Article 8 of the General Conditions."

No agreement was ever made concerning the amount of any liquidated damages for delay.

Defendants nonetheless contend that since the parties intended to have stipulated delay damages, although the amount was never agreed upon, that Hemenway is prevented from proving and recovering the actual damage occasioned by the delay.

We do not agree. The law is settled that where the parties have the capacity to, and do in fact, stipulate for liquidated delay damages, the stipulated amount will prevail over actual damages and the court will not inquire whether the actual damages equaled or exceeded the agreed amount. Lama v. Manale, 218 La. 511, 50 So.2d 15 (1950). However, that is not the situation in the instant case. While it appears that the parties contemplated liquidated damages in the contract of March 2, 1973, it is undisputed that no such damages were ever agreed upon.

Consequently, the trial court was correct in allowing Hemenway to prove and recover the damages occasioned by the delay in construction. See LSA-C.C. Art. 1934.

2.

The contract provided, as state above, a completion date of June 15, 1973. The trial court, for reasons not here pertinent, extended the contract's completion date to October 7, 1973. Defendants maintain that the trial court erred in refusing any further extensions of the completion date. They argue that they are entitled to a sixteen week extension because of rainy weather and union strikes.

*1359 Our careful review of the record reveals that defendants failed to prove with any degree of exactitude the number of days lost to rain, strikes or other delays. In this, defendants failed to meet their burden of proof.

We find that the trial court was correct in refusing any additional extension of the contract's completion date beyond October 7, 1973. Delay damages are recoverable for the period of October 7, 1973, through March 20, 1974.

3.

As damages for delay, the trial court inter alia awarded Hemenway the sums of $24,914.99 as rent paid on its old store during the delay, and $16,482.30 for additional interest paid on the interim financing. Defendants assert that this is erroneous; that it amounts to unjust enrichment of Hemenway at their expense; and that Hemenway can recover only the interest on the interim financing.

The measure of damages for the breach of an obligation is that amount which will put the plaintiff in the same position he would have been in had the obligation been fulfilled. Harelson v. Parish of East Baton Rouge, 272 So.2d 382 (La.App. 1st Cir. 1972). See also LSA-C.C. arts. 1930, 1934 and 2769.

Mr. William H. Shannon, Hemenway's president, testified regarding the rent paid on the old store, the interest on the interim financing and the terms of the permanent financing. He stated that the permanent financing would not attach until the building was completed; that the number and amount of the permanent financing payments were not affected by the delay in completion; and that Hemenway would pay the same amount in permanent financing whether the building was completed in October 1973, March 1974 or May 1974. However, he added that the delay in the completion of the building and, consequently, a commensurate delay in the commencement of the payments on the permanent financing, meant an additional interest expense on the interim financing as well as the payment of rent at the old store where the business was forced to continue its operation.

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Bluebook (online)
373 So. 2d 1356, 1979 La. App. LEXIS 2785, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hemenway-co-inc-v-bartex-inc-of-texas-lactapp-1979.