Opinion
NUMBER 2017 CA 0335
03-12-2018
IRBY AND MARIE BURLEIGH v. WINFRED LEE, D.R. HORTON, INC. - GULF COAST, GINGER LEJEUNE, LEJEUNE PROPERTY MANAGEMENT AND REAL ESTATE SALES, LLC, ASI LLOYDS, XYZ INSURANCE COMPANY AND 123 INSURANCE COMPANY
Kris A. Perret Baton Rouge, LA Counsel for Plaintiffs/Appellants Irby and Marie Burleigh Edward J. Laperouse, II Kari A. Bergeron L. Adam Thames Kelley R. Dick, Jr. Baton Rouge, LA Counsel for Defendant/Appellee D.R. Horton, Inc. - Gulf Coast
NOT DESIGNATED FOR PUBLICATION
On appeal from the Twenty-First Judicial District Court In and for the Parish of Livingston State of Louisiana
Docket Number 141,371 Honorable Robert H. Morrison, III Judge Presiding Kris A. Perret
Baton Rouge, LA Counsel for
Plaintiffs/Appellants
Irby and Marie Burleigh Edward J. Laperouse, II
Kari A. Bergeron
L. Adam Thames
Kelley R. Dick, Jr.
Baton Rouge, LA Counsel for
Defendant/Appellee
D.R. Horton, Inc. - Gulf Coast BEFORE: GUIDRY, PETTIGREW, AND CRAIN, JJ. GUIDRY, J.
This is an appeal of a summary judgment dismissing claims against a general contractor that constructed a home in which an invitee was injured. For the following reasons, we reverse the summary judgment in part and remand this matter for further proceedings.
FACTS AND PROCEDURAL HISTORY
In May 2012, Irby and Marie Burleigh viewed a home in Denham Springs, Louisiana, to possibly lease. While viewing the home, Mr. Burleigh used a pull-down ladder to inspect the attic. As Mr. Burleigh was descending from the attic, the entire assembly of the pull-down ladder detached from the ceiling, causing Mr. Burleigh to fall and sustain injuries.
A year later, the Burleighs filed a petition for damages against D.R. Horton, Inc. - Gulf Coast ("Horton"), as the general contractor that constructed the home, in addition to several other defendants. In the petition, the Burleighs alleged that Horton's failure to properly install the pull-down ladder and failure to inspect the work of subcontractors hired during construction of the home was a proximate cause of Mr. Burleigh's accident. The Burleighs later amended their petition to add claims against several more defendants, including John Mincey Construction and/or John Mincey, Sr. ("Mincey"). In the amended petition, the Burleighs alleged that Horton employed Mincey to perform carpentry work, and specifically, to install the pull-down ladder on which Mr. Burleigh was injured. Horton denied that it or anyone for whom it was legally responsible caused or contributed to the accident wherein Mr. Burleigh was injured.
On March 11, 2015, Horton filed a motion for summary judgment pointing out that the attic access ladder was installed by an independent contractor and inspected by an independent consultant. Horton asserted that because the parties responsible for the quality of the construction of the attic access ladder were both independent contractors, it was not legally responsible for their negligence in performing their work. Horton therefore sought dismissal of the Burleighs' claims against it as the Burleighs would be unable to show that Horton was liable for any defect in the work performed.
A hearing on Horton's motion for summary judgment was held on August 8, 2016, following which the trial court rendered summary judgment in favor of Horton, dismissing the Burleighs' claims against the company. A written judgment in conformity with the trial court's ruling was signed on September 20, 2016, which judgment the Burleighs devolutively appeal herein.
ASSIGNMENTS OF ERROR
1. The trial court committed legal error in granting summary judgment in favor of Horton because Mincey could not be an independent contractor and the subcontractor agreement entered into between Horton and Mincey was an absolute nullity[.]
2. The trial court committed legal error in granting summary judgment in favor of Horton finding that Mincey was an independent contractor and failing to find that Horton [exercised] actual control over Mincey thereby rendering Mincey an [employee of] Horton[.]
3. The trial court committed legal error in granting summary judgment in favor of Horton where Horton failed to enforce material provisions of the alleged subcontractor agreement and should not be allowed to benefit from the terms of the contract[.]
4. The trial court committed legal error in granting summary judgment in favor of Horton and absolving Horton of liability for its independent acts of negligence as the home builder/general contractor of the home in question[.]
APPLICABLE LAW
After adequate discovery, a motion for summary judgment is properly granted if the pleadings, depositions, answers to interrogatories, and admissions, together with affidavits, if any, admitted for purposes of the motion, show that there is no genuine issue as to material fact and that the mover is entitled to judgment as a matter of law. La. C.C.P. art. 966(B)(2) & (C)(1) (prior to amendment by 2015 Acts, No. 422, § 1, effective January 1, 2016).
The mover bears the burden of proving that he is entitled to summary judgment. However, if the mover will not bear the burden of proof at trial on the subject matter of the motion, he need only demonstrate the absence of factual support for one or more essential elements of his opponent's claim, action, or defense. La. C.C.P. art. 966(C)(2) (prior to amendment by 2015 Acts, No. 422, § 1, effective January 1, 2016). If the moving party points out that there is an absence of factual support for one or more elements essential to the adverse party's claim, action, or defense, then the nonmoving party must produce factual support sufficient to satisfy his evidentiary burden at trial. La. C.C.P. art. 966(C)(2) (prior to amendment by 2015 Acts, No. 422, § 1, effective January 1, 2016). If the nonmoving party fails to make this requisite showing, there is no genuine issue of material fact, and summary judgment should be granted. La. C.C.P. art. 966(C)(2) (prior to amendment by 2015 Acts, No. 422, § 1, effective January 1, 2016).
In ruling on a motion for summary judgment, the trial court's role is not to evaluate the weight of the evidence or to determine the truth of the matter, but instead to determine whether there is a genuine issue of triable fact. In determining whether summary judgment is appropriate, appellate courts review evidence de novo under the same criteria that govern the trial court's determination of whether summary judgment is appropriate. Because the applicable substantive law determines materiality, whether a particular fact in dispute is material can be seen only in light of the substantive law applicable to the case. Bice v. Home Depot U.S.A., Inc., 16-0447, p. 3 (La. App. 1st Cir. 12/22/16), 210 So. 3d 315, 318.
Louisiana law provides that "employers are answerable for the damage occasioned by their servants and overseers, in the exercise of the functions in which they are employed." La. C.C. art. 2320. However, an employer is not liable for the torts committed by an independent contractor in the course of performing his contractual duties. Fonseca v. City Air of Louisiana, LLC, 15-1848, p. 7 (La. App. 1st Cir. 6/3/16), 196 So. 3d 82, 87. In determining whether an independent contractor relationship exists, courts consider whether: (1) a valid contract exists between the parties; (2) the work is of an independent nature; (3) the contract allows for the work to be done according to the contractor's own methods, without being subject to control and direction except as to the result of the services to be rendered; (4) a specific price for the overall undertaking is agreed upon; and (5) the duration of the work is for a specific time and not subject to termination at the will of either party. Fonseca, 15-1848 at pp. 7-8, 196 So. 3d at 87.
DISCUSSION
Citing the Louisiana Contractor's Licensing Law, the Burleighs first assert that because Mincey did not possess a contractor's license from the Louisiana State Contractor's Licensing Board, a valid contract did not exist between Horton and Mincey. Hence, they argue that the trial court improperly found that Mincey was an independent contractor rather than an employee of Horton as the contract between them was an absolute nullity.
Louisiana Revised Statutes 37:2160(A) provides that "[i]t shall be unlawful for any person to engage or to continue in this state in the business of contracting, or to act as a contractor as defined in this Chapter , unless he holds an active license as a contractor under the provisions of this Chapter." (Emphasis added.) It is undisputed that Mincey is not a licensed contractor. So to the extent the evidence before us shows that Horton engaged Mincey to act as a contractor, as defined under the Louisiana Contractor's Licensing Law, the contract would be an absolute nullity as being in derogation of law enacted for the protection of the public interest. See La. C.C. art. 7; La. R.S. 37:2150; and Executone of Central Louisiana, Inc. v. Hospital Service District No. 1 of Tangipahoa Parish, 99-2819, p. 8 (La. App. 1st Cir. 5/11/01), 798 So. 2d 987, 993, writ denied, 01-1737 (La. 9/28/01), 798 So. 2d 116.
Section 2160 is found in Chapter 24 of Title 37, which is comprised of Sections 2150 through 2175.6, dealing with the profession of "Contractors."
When Horton took over the development of the South Haven Subdivision, it had Mincey sign an "Independent Contractor Agreement." In the agreement, Horton is referred to as "Owner," and Mincey is referred to as "Contractor." The specific work to be performed by Mincey is not expressly stated in the agreement. Instead, in section 1 of the agreement, titled "Scope of Work," the agreement recites that it is entered on a "blanket basis" and generally explains that the work to be performed under the agreement "shall include all work performed and materials supplied by Contractor to Owner, including, but not limited to, the labor, services and/or materials, equipment, transportation, or facilities necessary to complete the construction-related activities generally described in Exhibit A." There is no "Exhibit A" attached to the agreement in the record before us, but other evidence provided establishes that the work Mincey was engaged to perform was interior trim carpentry.
Section 1 of the agreement also states that "[t]he applicable quantities and pricing for the Work shall be reflected in the price sheet, proposal, bid, or purchase order issued by Owner, or in other documentation most recently accepted and approved in writing by Owner (the 'Pricing Schedule')." Under section 3, titled "Contract Price," the agreement states that "[t]he Pricing Schedule shall be applicable to all Work performed under this Agreement. The Pricing Schedule shall reflect the maximum total payment due to Contractor." In section 4, titled "Payment," the agreement provides that the Contractor shall submit an invoice to the Owner for work completed, and that "[a]ll Work described on a Purchase Order shall be considered separate and distinct from Work described on any other Purchase Order."
Louisiana Revised Statutes 37:2150.1(4)(a) defines a contractor, in pertinent part, as:
[A]ny person who undertakes to ... or offers to construct, ... direct, or in any manner assume charge of the construction, alteration, repair, improvement, movement, demolition, putting up, tearing down, or furnishing labor, or furnishing labor together with material or equipment, or installing the same for any building, ... project development, housing, or housing development, improvement, or any other construction undertaking for which the entire cost of same is fifty thousand dollars or more when such property is to be used for commercial purposes other than a single residential duplex, a single residential triplex, or a single residential fourplex. A construction project which consists of construction of more than two single residential homes, or more than one single residential duplex, triplex, or fourplex, shall be deemed to be a commercial undertaking. [Emphasis added.]Interpreting essentially this same language under a prior numbering of the statute, this court found that the clear wording of the statute mandates that when the costs of the undertaking exceed $50,000.00, any entity performing any of the listed acts on any structure (other than the exempted residential property identified in the statute) is a contractor that is subject to Louisiana Contractor's Licensing Law. State Licensing Board for Contractors v. Louisiana State Department of Agriculture and Forestry, 588 So. 2d 1268, 1271 (La. App. 1st Cir. 1991), writ denied, 590 So. 2d 598 (La. 1992)(statutorily overruled by La. R.S. 3:266(21) on another point of law).
Prior to amendment and re-enactment as La. R.S. 37:2150.1(4) by 1992 La. Acts, No. 681, § 1, La. R.S. 37:2157(A)(3)(a) defined a contractor as:
[A]ny person who undertakes to, attempts to, or submits a bid or offers to construct, supervise, superintend, oversee, direct, or in any manner assume charge of the construction, alteration, repair, improvement, movement, demolition, putting up, tearing down, or furnishing labor, material, or equipment, or installing the same for any building, highway, road, railroad, sewer, grading, excavation, pipeline, public utility structure, project development, housing, or housing development, improvement, or any other construction undertaking for which the entire cost of same is fifty thousand dollars or more when such property is to be used for commercial purposes other than a single residential duplex, a single residential triplex, or a single residential fourplex.
The business records offered by Horton regarding the work performed by Mincey on the home at issue reveal that the work was performed under purchase order number 06315 and that Mincey submitted invoice number 981 for payment for the work performed under that purchase order. The cost of the work performed under the identified purchase order and invoice was $1,457.33.
Considering the foregoing evidence, we find no merit in the Burleighs' assertion that the agreement between Horton and Mincey was an absolute nullity. The evidence does not establish that Mincey was engaged or acting as a contractor as provided under Louisiana Contractor's Licensing law. Instead, the evidence submitted by Horton reveals that Mincey was engaged to perform work on several different purchase orders, none of which appeared to even marginally reach the cost threshold recited in La. R.S. 37:2150.1(4)(a) for according Mincey contractor status. So while the work performed by Mincey may have been of a nature that a licensed contractor might perform, the evidence submitted by Horton clearly shows that the work performed by Mincey was not of the scope for which a license is required under the Louisiana Contractor's Licensing Law. As the evidence submitted by the Burleighs does not refute this showing, we reject their contention that the agreement between Horton and Mincey was invalid and an absolute nullity.
In their second assignment of error, the Burleighs contend that the trial court erred in finding Mincey to be an independent contractor and in failing to find that Horton exercised such operational control over Mincey as to render him an employee. Based on the procedural posture in which the determination of Mincey's independent contractor status comes before us, we find merit in this assignment of error.
The distinction between an employee and an independent contractor is a factual determination that must be decided on a case-by-case basis. Fonseca, 15- 1848 at p. 7, 196 So. 3d at 87. In making such a determination, courts are charged with considering the totality of the circumstances to decide whether an employer-employee relationship exists or whether the individual has independent contractor status. Fonseca, 15-1848 at p. 8, 196 So. 3d at 87. If reasonably supported by the evidence, a trial court's determination of a person's status as an independent contractor would be entitled to deference on review after a trial on the merits. See Tower Credit, Inc. v. Carpenter, 01-2875, p. 7 (La. 9/4/02), 825 So.2d 1125, 1129-30. But in the context of a summary judgment proceeding, because such consideration of independent contractor status would likely require evaluating the weight of the evidence, the determination would be improper. See Bice, 16-0447 at p. 3, 210 So. 3d at 318.
In the instant matter, which comes before us on appeal of a summary judgment finding Mincey to be an independent contractor, our review of the record reveals that one of the factors the trial court was called upon to consider in making that determination appears to contradict according Mincey such status. Specifically, the factor at issue is whether the work Mincey was engaged to perform was for a specific period of time or was terminable at the will of either party. In Hickman v. Southern Pacific Transportation Company, 262 La. 102, 117, 262 So. 2d 385, 390-91 (1972), the Court described the duration of work factor as requiring a showing that the contract is for a specific time and not subject to termination or discontinuance at the will of either side without a corresponding liability for its breach.
Horton asserts that the duration of work in this case was established by purchase orders issued pursuant to the Independent Contractor Agreement and that the purchase orders issued under the agreement were not terminable at the will of either party without any corresponding liability. There appears to be legal support for Horton's claim that the duration of work was established by the purchase orders issued. See Messina v. Koch Industries, Inc., 283 So. 2d 204, 207 (La. 1973) (wherein the court found that the parties in that matter could be said to have had a series of day-to-day contracts, or in effect, a contract for each day of work performed, as there was no binding obligation on the part of either party beyond completing the work that was ordered for the following day). However, we find no support for Horton's assertion that the purchase orders issued were not terminable at will without corresponding liability.
Under section 14, titled "Termination," the agreement states:
14.1 Termination by Owner for Cause of Convenience. This Agreement shall remain in full force and effect until terminated in writing by mailing notice to the other Party. Owner may terminate this Agreement at any time, whether or not Contractor is in default or breach of the Agreement.
14.2 Termination by Contractor. Contractor shall provide one hundred twenty (120) days' written notice before the effective date of termination, and shall perform fully under this Agreement during that notice period. If the Agreement is terminated by Owner, notwithstanding any other agreement to the contrary, the sole amount due to Contractor shall be that due for all authorized Work performed and materials supplied before termination, subject to deductions and charges authorized by this Agreement.
14.3 Survival. All obligations, duties and warranties for Work performed under this Agreement shall survive termination. [Emphasis added.]
And while there is language under section 12, titled "Remedies," that outlines various options granted to Horton in the event work performed by Mincey was found to be "incomplete," there are no corresponding remedies provided in the agreement in the event Horton failed to allow Mincey to complete work under a purchase order. Instead, under the "Scope of Work" provision, contained in section 1, the agreement provides that "Owner is not obligated to award any work on specific property to Contractor regardless of the Pricing Schedule, does not guarantee any quantity of work to Contractor, and may at its sole option retain others to perform the Work or similar work at any job location in addition to or in place of Contractor."
It has been held that being terminable at the will of either party, alone, is sufficient, when considering the other circumstances of the employment, to signify that the contract created a relationship of master and servant. Amvx v. Henry & Hall, 227 La. 364, 375, 79 So. 2d 483, 487 (1955). Moreover, it has been found that the right to terminate the relationship without cause, where no term of employment is prescribed, is characteristic of the master and servant or employer-employee relationship. The right is at the same time antagonistic to the independent contractor relationship. Hickman, 262 La. at 119, 262 So. 2d at 391; see also Hughes v. Goodreau, 01-2107, p. 11 (La. App. 1st Cir. 12/31/02), 836 So. 2d 649, 658-59, writ denied, 03-0232 (La. 4/21/03), 841 So. 2d 79 (wherein this court pointed out that the "most telling [fact]" defining the relationship of an employer and worker is the duration of work factor).
There is nothing in the language of section 14 of the agreement that mandates that work on a purchase order be completed or else the breaching party is subject to liability. Nor is there a provision in the agreement imposing liability on Horton for failing to allow work on a purchase order to be completed. Further, Horton did not submit any evidence that would establish such liability. Consequently, as the evidence presented on summary judgment indicates that the duration of work under the agreement was terminable at will, and as jurisprudence indicates that duration of work is a significant factor in determining independent contractor status, the trial court erred in finding that there is no genuine issue of material fact as to Mincey's status as an independent contractor. Accordingly, we will reverse the summary judgment to the extent it dismisses the Burleighs' claims of vicarious liability against Horton.
In their third assignment of error, the Burleighs allege numerous breaches of the Independent Contractor Agreement to which they were not a party and for which they would have no cause personally to assert an action for breach. See Greater Lafourche Port Commission v. James Construction Group, L.L.C., 11-1548, p. 11 (La. App. 1 Cir. 9/21/12), 104 So. 3d 84, 91 (finding that absent privity of contract, a cause of action cannot be asserted based on breach of contract). Moreover, we recognize that the fact that a contract may have been breached does not render inoperative remaining contractual provisions. Lifecare Hospitals of New Orleans, L.L.C. v. Lifemark Hospitals of Louisiana, Inc., 07-914, pp. 10-11 (La. App. 5th Cir. 4/15/08), 984 So. 2d 894, 899-900. Hence, we reject the Burleighs' arguments under this assignment contending that the agreement was of no effect due to alleged breaches of the agreement by Horton and Mincey.
In their final assignment of error, the Burleighs contend that the trial court erred in dismissing their claims of independent negligence against Horton. They allege Horton did nothing to assess or ensure that quality work was performed by Mincey, but the evidence shows otherwise.
Horton employed Michael Cascio as the site superintendent for the South Haven Subdivision development. In his deposition, Cascio testified that he was not involved in selecting the subcontractors who worked on homes in the South Haven Subdivision development, and he admitted that at the time, he did not know how those subcontractors were selected. After ten years of working for Horton, however, he said he knew the process by which Horton signs up a new subcontractor. He explained that Horton checks the subcontractor's references, makes sure the subcontractor has proper insurance, checks other work the subcontractor has done, and generally makes sure the subcontractor is qualified.
As for the steps taken by Horton to ensure that quality work is performed, Cascio stated that Horton relied on its subcontractors, who he stated were experts in each of their fields. He said Horton also relied on "parish inspections" and further used a third party to inspect all of the work performed to make sure that it met all industry standards and specifications. With regard to the South Haven Subdivision development, the third-party inspector hired by Horton was Hanson Home Consulting. Horton submitted a copy of the Hanson final inspection report for the home at issue, which showed that all the listed items of trim work completed by Mincey were complete and correct, including item 120, which is listed as "Attic-access stairs secured and operating properly."
The evidence submitted on the motion for summary judgment reveals that when Horton commenced construction in the South Haven Subdivision, Mincey was already working on homes in the subdivision for a prior developer. Cascio admitted that prior to working on the South Haven Subdivision development, he did not remember meeting Mincey, but he had a general knowledge of him. And despite the circumstances under which he was testifying, in his deposition, Mincey repeatedly commented that he did "good work" and that he had learned his trade "from the best." He stated that he obtained most of his work based on word of mouth because of the quality of his work. As for the South Haven Subdivision work, he opined that he was selected due to the known quality of his work. No evidence of Mincey's reputation or work history to the contrary was submitted by the Burleighs.
Instead, in opposition to the motion for summary judgment, the Burleighs submitted the affidavit and report of a professional civil engineer to show that the attic access ladder was improperly installed by Mincey. While this evidence may establish that Mincey negligently installed the attic access ladder, it does not demonstrate that Horton knew or in the exercise of reasonable care should have known that Mincey committed such negligence or that Horton otherwise failed to exercise reasonable care to ensure that quality work was performed in constructing the home. See La. C.C. art. 2317.1.
Thus, the Burleighs failed to show any genuine issue of material fact as to whether Horton should be found liable for any independent negligence. Accordingly, we find the trial court properly granted summary judgment, as a matter of law, dismissing the claims of independent negligence against Horton.
CONCLUSION
On de novo review of the record before us, we find that the trial court improperly granted summary judgment dismissing the claims against Horton for vicarious liability, but we find no error in the trial court's dismissal of the claims of independent negligence. We therefore affirm the summary judgment dismissing the claims of independent negligence, reverse the summary judgment to the extent it dismisses the Burleighs' claims of vicarious liability against Horton, and remand this matter for further proceedings consistent with this opinion. All costs of this appeal are cast one half to the appellants, Ira and Marie Burleigh, and one half to the appellee, D.R. Horton, Inc. - Gulf Coast.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.