Judgment rendered January 13, 2021. Application for rehearing may be filed within the delay allowed by Art. 2166, La. C.C.P.
No. 53,663-CA
COURT OF APPEAL SECOND CIRCUIT STATE OF LOUISIANA
*****
SCOTT HARLAN ALEXANDER Plaintiffs-Appellees AND ADELIA ANGELETTE ALEXANDER
versus
RODGERS HOMES AND Defendants CONSTRUCTION, INC., ET AL.
Appealed from the Twenty-Sixth Judicial District Court for the Parish of Bossier, Louisiana Trial Court No. 161,151
Honorable E. Charles Jacobs, Judge
LUNN IRION LAW FIRM, LLC Counsel for Appellant, By: James A. Mijalis Houston Specialty Alexander J. Mijalis Insurance Company William H. Priestly, Jr.
PETTIETTE, ARMAND, DUNKELMAN, WOODLEY, BYRD & CROMWELL, LLP By: Donald Armand, Jr.
COOK, YANCEY, KING & GALLOWAY, Counsel for Appellees, APLC Scott Harlan Alexander By: Robert Kennedy, Jr. and Adelia Angelette Alexander MARK ODOM, JR. Counsel for Appellee, Rodgers Homes and Construction, Inc.
Before PITMAN, THOMPSON, and BLEICH (Pro Tempore), JJ. PITMAN, J.
Defendant Houston Specialty Insurance Company, alleged insurer of
Rodgers Homes and Construction Inc. (“Rodgers”), appeals a default
judgment granted in favor of Plaintiffs Scott and Adelia Alexander in the
amount of $248,426.19 plus attorney fees and costs. For the following
reasons, we reverse the judgment of the trial court and remand for further
proceedings.
FACTS
Plaintiffs entered into a contract with Rodgers to build their dream
home in Bossier Parish. The total price of construction of the home was
over $900,000. Some work still needed to be completed after Plaintiffs
began occupying the home in December 2018, including cleaning of its
numerous windows. Rodgers sent a subcontractor, Shelia Millican,1 d/b/s
Scrubs Cleaning Service (“Scrubs Cleaning”), to clean the windows. After
she finished, Plaintiffs noticed that the windows had been damaged by the
cleaning product Millican used. They demanded that Rodgers fix the
damage, and three efforts were made to replace the windows and glass doors
in the house.
The first replacement windows were too small. The second and third
sets of windows contained “crop circles” that showed between the panes of
glass which were left by the manufacturing process. Plaintiffs also noticed
that the windows leaked when it rained.
Plaintiffs filed suit against Rodgers, Scrubs Cleaning and Defendant,
which was alleged to be Rodgers’s commercial general liability insurer.
1 The petition states that this person’s name is Shelia, but in other parts of the record, she is called Sheila. They alleged defects under the New Home Warranty Act and breach of
contract.
Rodgers answered the petition and pled affirmative defenses.
Defendant was served, but failed to file responsive pleadings. Plaintiffs
were granted a preliminary default, and a hearing was held on a final default
judgment. At the hearing, Christopher Randel from The Cottage, a business
that inspects and evaluates existing windows and doors prior to replacement,
testified that he had examined Plaintiffs’ house and that an amount of
$216,022.77 would be sufficient to repair the glass in the home and all the
window frames. The attorney requested $5,000 in fees as per the contract in
the event there was defective workmanship in the building of the home. The
trial court made the decision to add an extra 15 percent to the total so that
Plaintiffs would have enough money to cover any unexpected expenses in
the repair.
The trial court confirmed the default, and a final default judgment was
entered against Defendant on January 30, 2020, in the amount of
$248,426.19 plus $5,000 in attorney fees. When served with notice of the
default judgment, Defendant filed a suspensive appeal.
DISCUSSION
Defendant argues that the trial court erred in admitting Exhibit B, a
copy of the alleged insurance policy issued by Defendant to Rodgers,
because Plaintiffs failed to authenticate the policy with reliable evidence
under La. C.E. arts. 901, et seq. It contends that without the proof of
authentication of the policy, Plaintiffs failed to make a prima facie case as
required by La. C.C.P. art. 1702(A). It asserts that the unauthenticated
insurance policy issued by it to Rodgers could have been authenticated by 2 offering Rodgers’s testimony identifying the policy, proclaiming that
premiums were paid for the policy and that it was in full force and effect or
by filing a request for admission as to the identity of the policy and its
effectiveness. However, none of these options were pursued by the
Plaintiffs.
Plaintiffs argue that the only true issue is whether Defendant has
satisfied its burden on appeal of establishing that the trial court abused its
discretion in concluding that there is sufficient evidence from which a
reasonable juror could find that the exhibit is a copy of the commercial
general liability insurance policy issued by it to Rodgers for the time period
at issue in this case. They contend that Exhibit 2 is self-authenticating in
that it contains many indications that it is the policy issued by Defendant to
Rodgers, with all declarations, forms, endorsements and exclusions. There
are references throughout the Exhibit that identify it as the policy issued to
Rodgers, and it bears the signatures of the president and secretary of
Defendant and its authorized representative.
For these reasons, Plaintiffs frame the issue as one not of admissibility
or authenticity of the evidence, but as one pertaining to whether the trial
court erred in concluding that the evidence was sufficient upon which to
base a final default judgment.
The appellate jurisdiction of courts of appeal extends to both law and
facts. La. Const. art. V, § 10(B). A court of appeal may not overturn a
judgment of a trial court absent an error of law or a factual finding that was
manifestly erroneous or clearly wrong. Stobart v. State Through Dep’t. of
Transp. and Dev., 617 So. 2d 880 (La.1993). When the court of appeal finds
that a reversible legal error or manifest error of material fact was made in the 3 trial court, it is required to redetermine the facts de novo from the entire
record and render a judgment on the merits. Rosell v. ESCO, 549 So. 2d 840
(La. 1989). In reviewing default judgments, the appellate court is restricted
to determining the sufficiency of the evidence offered in support of the
judgment. Arias v. Stolthaven New Orleans, L.L.C., 08-1111 (La. 5/5/09),
9 So. 3d 815. This determination is a factual one governed by the manifest
error standard of review. Id.
In Arias, supra, the Louisiana Supreme Court addressed a default
judgment rendered against an insurer and held that an insurer’s liability
could not be established for purposes of confirming a default judgment
without admission into evidence of the actual contract for insurance.
Confirmation of a default judgment is similar to a trial and requires, with
admissible evidence, proof of the demand sufficient to establish a prima
facie case.
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Judgment rendered January 13, 2021. Application for rehearing may be filed within the delay allowed by Art. 2166, La. C.C.P.
No. 53,663-CA
COURT OF APPEAL SECOND CIRCUIT STATE OF LOUISIANA
*****
SCOTT HARLAN ALEXANDER Plaintiffs-Appellees AND ADELIA ANGELETTE ALEXANDER
versus
RODGERS HOMES AND Defendants CONSTRUCTION, INC., ET AL.
Appealed from the Twenty-Sixth Judicial District Court for the Parish of Bossier, Louisiana Trial Court No. 161,151
Honorable E. Charles Jacobs, Judge
LUNN IRION LAW FIRM, LLC Counsel for Appellant, By: James A. Mijalis Houston Specialty Alexander J. Mijalis Insurance Company William H. Priestly, Jr.
PETTIETTE, ARMAND, DUNKELMAN, WOODLEY, BYRD & CROMWELL, LLP By: Donald Armand, Jr.
COOK, YANCEY, KING & GALLOWAY, Counsel for Appellees, APLC Scott Harlan Alexander By: Robert Kennedy, Jr. and Adelia Angelette Alexander MARK ODOM, JR. Counsel for Appellee, Rodgers Homes and Construction, Inc.
Before PITMAN, THOMPSON, and BLEICH (Pro Tempore), JJ. PITMAN, J.
Defendant Houston Specialty Insurance Company, alleged insurer of
Rodgers Homes and Construction Inc. (“Rodgers”), appeals a default
judgment granted in favor of Plaintiffs Scott and Adelia Alexander in the
amount of $248,426.19 plus attorney fees and costs. For the following
reasons, we reverse the judgment of the trial court and remand for further
proceedings.
FACTS
Plaintiffs entered into a contract with Rodgers to build their dream
home in Bossier Parish. The total price of construction of the home was
over $900,000. Some work still needed to be completed after Plaintiffs
began occupying the home in December 2018, including cleaning of its
numerous windows. Rodgers sent a subcontractor, Shelia Millican,1 d/b/s
Scrubs Cleaning Service (“Scrubs Cleaning”), to clean the windows. After
she finished, Plaintiffs noticed that the windows had been damaged by the
cleaning product Millican used. They demanded that Rodgers fix the
damage, and three efforts were made to replace the windows and glass doors
in the house.
The first replacement windows were too small. The second and third
sets of windows contained “crop circles” that showed between the panes of
glass which were left by the manufacturing process. Plaintiffs also noticed
that the windows leaked when it rained.
Plaintiffs filed suit against Rodgers, Scrubs Cleaning and Defendant,
which was alleged to be Rodgers’s commercial general liability insurer.
1 The petition states that this person’s name is Shelia, but in other parts of the record, she is called Sheila. They alleged defects under the New Home Warranty Act and breach of
contract.
Rodgers answered the petition and pled affirmative defenses.
Defendant was served, but failed to file responsive pleadings. Plaintiffs
were granted a preliminary default, and a hearing was held on a final default
judgment. At the hearing, Christopher Randel from The Cottage, a business
that inspects and evaluates existing windows and doors prior to replacement,
testified that he had examined Plaintiffs’ house and that an amount of
$216,022.77 would be sufficient to repair the glass in the home and all the
window frames. The attorney requested $5,000 in fees as per the contract in
the event there was defective workmanship in the building of the home. The
trial court made the decision to add an extra 15 percent to the total so that
Plaintiffs would have enough money to cover any unexpected expenses in
the repair.
The trial court confirmed the default, and a final default judgment was
entered against Defendant on January 30, 2020, in the amount of
$248,426.19 plus $5,000 in attorney fees. When served with notice of the
default judgment, Defendant filed a suspensive appeal.
DISCUSSION
Defendant argues that the trial court erred in admitting Exhibit B, a
copy of the alleged insurance policy issued by Defendant to Rodgers,
because Plaintiffs failed to authenticate the policy with reliable evidence
under La. C.E. arts. 901, et seq. It contends that without the proof of
authentication of the policy, Plaintiffs failed to make a prima facie case as
required by La. C.C.P. art. 1702(A). It asserts that the unauthenticated
insurance policy issued by it to Rodgers could have been authenticated by 2 offering Rodgers’s testimony identifying the policy, proclaiming that
premiums were paid for the policy and that it was in full force and effect or
by filing a request for admission as to the identity of the policy and its
effectiveness. However, none of these options were pursued by the
Plaintiffs.
Plaintiffs argue that the only true issue is whether Defendant has
satisfied its burden on appeal of establishing that the trial court abused its
discretion in concluding that there is sufficient evidence from which a
reasonable juror could find that the exhibit is a copy of the commercial
general liability insurance policy issued by it to Rodgers for the time period
at issue in this case. They contend that Exhibit 2 is self-authenticating in
that it contains many indications that it is the policy issued by Defendant to
Rodgers, with all declarations, forms, endorsements and exclusions. There
are references throughout the Exhibit that identify it as the policy issued to
Rodgers, and it bears the signatures of the president and secretary of
Defendant and its authorized representative.
For these reasons, Plaintiffs frame the issue as one not of admissibility
or authenticity of the evidence, but as one pertaining to whether the trial
court erred in concluding that the evidence was sufficient upon which to
base a final default judgment.
The appellate jurisdiction of courts of appeal extends to both law and
facts. La. Const. art. V, § 10(B). A court of appeal may not overturn a
judgment of a trial court absent an error of law or a factual finding that was
manifestly erroneous or clearly wrong. Stobart v. State Through Dep’t. of
Transp. and Dev., 617 So. 2d 880 (La.1993). When the court of appeal finds
that a reversible legal error or manifest error of material fact was made in the 3 trial court, it is required to redetermine the facts de novo from the entire
record and render a judgment on the merits. Rosell v. ESCO, 549 So. 2d 840
(La. 1989). In reviewing default judgments, the appellate court is restricted
to determining the sufficiency of the evidence offered in support of the
judgment. Arias v. Stolthaven New Orleans, L.L.C., 08-1111 (La. 5/5/09),
9 So. 3d 815. This determination is a factual one governed by the manifest
error standard of review. Id.
In Arias, supra, the Louisiana Supreme Court addressed a default
judgment rendered against an insurer and held that an insurer’s liability
could not be established for purposes of confirming a default judgment
without admission into evidence of the actual contract for insurance.
Confirmation of a default judgment is similar to a trial and requires, with
admissible evidence, proof of the demand sufficient to establish a prima
facie case. Id., citing La. C.C.P. art. 1702(A). The elements of a prima
facie case are established with competent evidence, as fully as though each
of the allegations in the petition were denied by the defendant. Id. In other
words, the plaintiff must present competent evidence that convinces the
court that it is probable that he would prevail at trial on the merits. Id. A
plaintiff seeking to confirm a default must prove both the existence and the
validity of his claim. A default judgment cannot be different in kind from
what is demanded in the petition and the amount of damages must be proven
to be properly due. Id., citing La. C.C.P. art. 1703.
At the hearing on the confirmation, the rules of evidence generally
apply. The plaintiff must follow the rules of evidence even though there is
no opponent. Id. The Arias court noted that “inadmissible evidence, except
4 as specifically provided by law, may not support a default judgment even
though it was not objected to because the defendant was not present.” Id.
The Arias court also stated that “when an obligation is based on a
writing, prima facie proof of the obligation requires introduction of the
writing into evidence.” Id. The court stated that the insurance policy was
the principal basis for the plaintiffs’ claims against the insurer in securing a
default judgment; and, thus, it was essential that the policy be included as
evidence to support a prima facie showing of liability coverage of the
insurance. Id.
La. C.C.P. art. 1702(B)(1) concerns default procedure and states:
When a demand is based upon a conventional obligation, affidavits and exhibits annexed thereto which contain facts sufficient to establish a prima facie case shall be admissible, self-authenticating, and sufficient proof of such demand. The court may, under the circumstances of the case, require additional evidence in the form of oral testimony before entering a final default judgment.
La. C.E. art. 1003 concerns admissibility of duplicates as evidence
and states that duplicates are admissible to the same extent as originals
unless under the circumstances it would be unfair to admit the duplicate in
lieu of the original.
The court in Arias noted that while the direct action statute gives
injured persons the right to bring a direct action against an insurer, the terms
and conditions of the insurance policy are part of the principal basis for the
claims and are critical to establish a prima facie case of the insurer’s liability
as well as the plaintiff’s right to pursue the insurer alone by default. The
court stated:
In a case such as this, where plaintiffs are seeking a default judgment against the insurer, although the insured has answered the petition and denied liability, the terms and conditions of the 5 insurance policy are part of the principal basis for the claims and critical to establishing a prima facie case of the insurer’s liability, as well as the plaintiffs’ right to pursue the insurer alone by default.
Arias v. Stolthaven New Orleans, L.L.C., supra.
In the case sub judice, Plaintiffs failed to authenticate the insurance
policy containing the terms and conditions that were part of the principal
basis for their claims and which were critical to establishing a prima facie
case of the insurer’s liability. Although La. C.C.P. art. 1702(B) states that
the policy may be self-authenticating, the article also states that the trial
court may, under the circumstances of the case, require additional evidence
in the form of oral testimony before entering a final default judgment.
Further, admission of the duplicate, instead of the original, was unfair under
the circumstances when Plaintiffs failed to authenticate the insurance policy
and, instead, relied on the fact that it had the company name and logo on it,
all of the endorsements and exclusions and signed by company executives.
Plaintiffs could have taken many different approaches to authenticate
the insurance policy through a request for admission to the insurer, a request
for admission to the builder/insured, live testimony from the builder as to the
existence and effectiveness of the insurance policy or deposition testimony
from someone with knowledge regarding the policy. Plaintiffs took none of
these actions to support the existence and good standing of the insurance
policy.
We find that the unauthenticated insurance policy is insufficient
evidence to support the judgment and award of the trial court, and a prima
facie showing has not been made that Plaintiffs are entitled to the judgment
rendered. The judgment of the trial court in favor of Plaintiffs and against
6 Defendant is hereby reversed. The matter is remanded for further
proceedings consistent with this opinion.
Defendant raised other assignments of error regarding exclusions in
the insurance policy which it deemed applicable to the case at bar; however,
based on this court’s decision to reverse the judgment of the trial court due
to the insufficiency of the evidence, those issues are pretermitted.
CONCLUSION
For the foregoing reasons, the default judgment of the trial court in
favor of Plaintiffs Scott and Adelia Alexander and against Defendant
Houston Specialty Insurance Company is hereby reversed and remanded for
further proceedings consistent with this opinion. Costs of appeal are
assessed to Plaintiffs.
REVERSED AND REMANDED.