author: PETERS, J.

text:
    Anthony “Ricky” DEVILLIER, et al. v. ALPINE EXPLORATION COMPANIES, INC., et al.
    No. 06-0770.
    Court of Appeal of Louisiana, Third Circuit.
    Dec. 29, 2006.

      Dennis J. Vidrine, Attorney at Law, Lafayette, LA, for Defendants/Appellants, Petroleum Engineers, Inc. and Ray Hodge.
    Robert M. Kallam, Jennifer A. Wells, Preis <&- Roy, Lafayette, LA, for Third-Party Defendant/Appellee, Evanston Insurance Company.
    Court composed of OSWALD A. DECUIR, JIMMIE C. PETERS, and MICHAEL G. SULLIVAN, Judges.
   PETERS, J.

11 This appeal is from a judgment interpreting insurance coverage. The issue is whether a Self-Insured Retention (SIR) of $100,000.00 provided in an endorsement to a liability policy issued by Evanston Insurance Company (Evanston) applies once to each individual claim of every claimant arising from an occurrence or only once to the occurrence regardless of the number of individual claims or claimants. Interpreting the policy language, the trial court rendered a partial summary judgment ruling that the SIR was applicable to each individual claim and every claimant. The third-party petitioners affected by the ruling, Petroleum Engineers, Inc., Petroleum Engineers International, Inc., and Ray Hodge (collectively “Petroleum”), appealed. Of crucial importance in the determination of the issue is the policy’s definition of the word “claim.” We find that, as applied to the SIR in this case, the definition raises an ambiguity which by settled rules of interpretation must be resolved against the insurer. Accordingly, we reverse and remand for further proceedings.

DISCUSSION OF THE RECORD

An oil well experienced a hydrocarbon blowout in Jefferson Parish on February 28, 2004. As a result, a number of lawsuits for personal injuries and property damages were filed. The plaintiffs in the present action, Anthony Devillier and his wife, filed one of those suits naming Petroleum and other parties as defendants. In that suit, Mr. Devillier sued for his personal injuries and his wife filed a claim for loss of consortium.

Petroleum filed a third-party demand in the Devillier suit against its insurer, Ev-anston, which issued Commercial General Liability Policy # 03PKG00694 insuring 1 ¡¡Petroleum from 6/25/2003 to 6/30/2004. The policy contains five coverage parts, only three of which are involved in any way in this case. Part A covers Commercial General Liability, Part D covers Contractors Pollution Liability, and a “claims-made” part covers Professional Liability. The parties agree that Part D, the Contractors Pollution Liability Coverage, is specifically applicable to this case. The policy also contains an SIR Endorsement affecting all three of the above parts, and that endorsement is the focus of the present controversy.

Petroleum sought a partial summary judgment and declaratory order regarding the SIR coverage. Petroleum contended that only one SIR of $100,000.00 was applicable to the blowout, or pollution condition, and that the SIR was not applicable to each separate claim asserted by the multiple plaintiffs. Its contention was that, once it met its obligation of investigation, defense, and payment of any claim in the amount of $100,000.00, the insurer was obligated for the balance of the loss no matter the number of claims or claimants. Evanston filed a cross-motion putting at issue the same coverage dispute. Evans-ton contended that the SIR of $100,000.00 applied “per claim,” meaning to each claimant as a separate claim, and that until the SIR was exhausted as to each it had no obligation to defend.

The trial court denied Petroleum’s motion and granted Evanston’s. The court found that the policy was clear and rendered judgment holding that “this $100,000 ‘per claim’ self-insured retention must be satisfied per each individual claimant (i.e., not per occurrence and not per lawsuit).”

The judgment dismissed Petroleum’s third-party petition “without prejudice to [the third-party-plaintiffs] rights to reassert the Third-Party Demand once the [<¡$100,000 per claimant self-insured retention is exhausted for each individual claimant.”

On this appeal, Petroleum assigns error to the holding that the policy was free of ambiguity as well as the holding that the SIR applied to each individual claim and claimant, and not to the “occurrence” or “pollution condition.”

OPINION

Appellate courts review grants of summary judgment de novo, using the same criteria that govern the trial court’s consideration of whether summary judgment is appropriate, that is, whether there is a genuine issue of material fact and whether the mover is entitled to judgment as a matter of law. Ocean Energy, Inc. v. Plaquemines Parish Gov’t, 04-66 (La.7/6/04), 880 So.2d 1. Both sides agree that the coverage issue is a matter of interpretation of the policy. Both sides agree that, if there is ambiguity in the policy regarding the issue before us, the insured wins. Whether or not a-policy is ambiguous is a question of law. La. Ins. Guar. Ass’n v. Interstate Fire & Cas. Co., 93-911 (La.1/14/94), 630 So.2d 759.

The Commercial General Liability Coverage definitions are specifically made applicable to the Contractors Pollution Liability Coverage Endorsement. The policy states that “words and phrases that appear in quotation marks have special meaning.” The definitions appear in quotation marks.

| ¿The definition of “ ‘occurrence’ ” is as follows:

“Occurrence” means an accident, including continuous or repeated exposure to substantially the same general harmful conditions.

The Contractors Pollution Liability Coverage Endorsement adds the definition of “‘Claim’ or ‘Claims,’” “‘Pollution Condition,’ ” and “ ‘Pollutants’ ” as follows:

“Claim” or “Claims” means a request or a demand received by you or the Company for money or services, including the institution of “suit” or arbitration proceedings against you, seeking damages.
“Pollution Condition” means the discharge, dispersal, seepage, migration, release or escape of “pollutants”.
“Pollutants” means any solid, liquid, gaseous, thermal, biological or radioactive substance, material, matter, irritant or contaminant, including smoke, vapors, soot, fumes, acids, alkalis, chemicals and waste.

The insuring agreement in the Commercial General Liability section provides that the amount the insurer will pay for damages is limited as described in LIMITS OF INSURANCE (SECTION III). Under that Section is the following:

1. The Limits of Insurance shown in the Declarations and the rules below fix the most we will pay, regardless of the number of:
b. Claims made or “suits” brought; or
c. Persons or organizations making claims or bringing “suits”.

The parties agree that this case presents the situation where there is a commercial general liability policy with separate coverage parts provided by an endorsement. There are two endorsements to the policy that are applicable to the present dispute. The first is the Contractors Pollution Liability Coverage Endorsement.

|sThe insuring agreement for the Contractors Pollution Liability Coverage Endorsement contains the following language:

b. This insurance applies to “bodily injury” and “property damage” only if:
(1) The “bodily injury” or “property damage” is caused by an “occurrence” that takes place in the “coverage territory” resulting in a “pollution condition”....

It also provides: “We may, at our discretion, investigate any ‘occurrence’ and settle any ‘claim’ or ‘suit’ that may result.” It includes the same limits of insurance provision as quoted above regarding the number of claims made or suits brought or persons or organizations making claims or bringing suits.

Paragraph 10 of the Limits of Insurance section of the Contractors Pollution Liability Coverage Endorsement provides:

10. The Deductible amount stated on the Declarations is applicable to each “claim” and each “pollution condition”, applies once to each “claim” and each “pollution condition” and can be applied either for defense expenses, settlement, compromise or indemnification.

This paragraph comprised of a single sentence is a key provision in the policy. The parallel structures in Paragraph 10 emphasize the equal importance of “claim” and “pollution condition” in the sentence. The deductible (SIR) is made applicable once to each. Literally, the sentence, standing alone and without reference to other provisions in the policy, is applicable to this insurance only in the limited circumstance when there is one pollution condition and but one claim arising from that pollution condition. If in Paragraph 10 “claim” is singular, i.e., if it refers only to a single cause of action asserted by a single claimant, an irreconcilable ambiguity ^exists when there are multiple claims arising from one pollution condition. However, all parts of the contract must be considered. “Each provision in 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.Civ.Code art. 2050. We will later relate Paragraph 10 to other parts of the policy, bearing in mind that the policy directs us to give “special meaning” to definitions of words and phrases in quotation marks.

The second endorsement applicable to the present dispute is the Self-Insured Retention Endorsement. The SIR Endorsement begins with this language:

This endorsement modifies insurance provided under the following:

COMMERCIAL GENERAL LIABILITY COVERAGE PART PRODUCTS/COMPLETED OPERATIONS LIABILITY COVERAGE PART OWNERS AND CONTRACTORS PROTECTIVE LIABILITY COVERAGE PART PROFESSIONAL LIABILITY COVERAGE PART

Following this list identifying the four coverage parts being modified, the endorsement then states that “[t]he total limit of liability of the Company as stated in the policy declarations shall apply excess of the retained limit (herein called the Self-Insured Retention) as stated in the endorsement, and the Named Insured agrees to assume this retained limit....” The printed form of the endorsement has spaces provided for insertion of specific information, and in those spaces are inserted abbreviated references to three coverages and the self-insured retention the named insured agreed to assume. For Commercial General Liability, it is “$25,000 per claim”; for Contractors Pollution Liability, the amount is “$100,000 per claim”; and, for Professional Liability, it is “$100,000 per claim.” Thus, the Contractors Pollution |^.Liability coverage is subject to a $100,000.00 “per claim” SIR Endorsement having no annual aggregate retention.

. The issue in this case is the meaning of “per claim.” Evanston’s brief asserts that “per claim” is a term defined in the policy. It is not. Its brief also argues that “per claim” equates to “per person.” Nothing in the policy manifests that equation. The pleadings show that the well blowout resulted in a “pollution condition.” Applying Paragraph 10 of the Limits of Insurance section of the Contractors Pollution Liability Coverage Endorsement, it is quite clear that there can be but one SIR deductible or retention to one pollution condition. It is equally certain that the same interpretation applies to “claim” in Paragraph 10. We emphasize, however, that the element of uncertainty in this case is the precise definition of “claim.”

The word “claim” and the word “claims” are not separately defined in the policy. However, the phrase “ ‘claim’ or ‘claims’ ” is defined. The defined words are nouns. One is singular, and the other is plural. Evanston argues that each individual claimant’s demand constitutes a separate claim triggering separate retention amounts. However, by. definition in the policy the phrase “claim or claims” is used to denote ^either a singular “claim” or plural “claims.” Both words have the same definition, and no distinction is made between the application of the singular and the plural. The word “or” is a coordinating conjunction which joins words of equal grammatical rank. See Winifred Bryan Horner, et al., Harbrace College Handbook, 16 (12th ed., Harcourt Brace & Co.1994). “Claims,” like “claim,” as defined, means a request or a demand for money or services and includes the institution of suit. A suit making a request or a demand for money or services may be instituted by many claimants or by one. If “per claim” in the SIR Endorsement unambiguously refers to a single claim, as argued by Evanston, then the addition of “or ‘claims’ ” in the definitional phrase “ ‘claim’ or ‘claims’ ” is meaningless. We cannot ignore its own language written into the policy by the insurer. Evanston’s brief argues that “each individual person or entity and their assertion(s) of damages is considered a separate and distinct “claim” as that phrase is used in the contract.” However, that phrase as used in the contract equates “claims” with “claim.” By treating “claim” or “claims” as being the same with no distinction between the singular and the plural, the phrase “per claim” can just as well be rendered “per claims.”

Additionally, the SIR Endorsement modified the policy with this provision:

3. In the event of a claim or claims arising which appear likely to exceed the Self-Insured Retention, no costs, other than adjusting expenses, shall be incurred by the Insured without the written consent of the Company[.]

Once more — and this time tellingly in the context of the SIR Endorsement itself— the reference is to “claim or claims,” without distinction as to number. If the SIR applies once to each claim, the addition of “or claims” is superfluous. On the other hand, if the SIR applies once to each claim or claims, whether one or many, the application is consistent with the rest of the language' in Paragraph 10 of the Limits of Insurance, |9which states that the deductible is applicable to each “pollution condition” and applies once to each “pollution condition.”

Both parties in this case argue the same three cases dealing with SIR coverages: Trahan v. Savage Industries, Inc., 96-1239 (La.App. 3 Cir. 3/5/97), 692 So.2d 490, writs denied, 97-1636, 97-1652 (La.10/3/97), 701 So.2d 207, 209; Musmeci v. Schwegmann Giant Super Markets, Inc., 332 F.3d 339 (5th Cir.2003), cert. denied, 540 U.S. 1110, 124 S.Ct. 1078, 157 L.Ed.2d 898 (2004); and Maxim Manufacturing Corp. v. Alliance General Insurance Co., 911 F.Supp. 239 (S.D.Miss.1995).

In Trahan, 692 So.2d 490, the plaintiff sued for his personal injuries, and his wife and children made loss of consortium claims. The bankrupt defendant had an SIR policy. The trial court cumulated the loss of consortium claims with the injury claim under one SIR of $100,000.00. We reversed that ruling, finding that the clear policy language did not permit grouping the loss of consortium claims of Trahan’s wife and children under the same. SIR applied to his injury. We noted that the SIR section of the policy provided that “ ‘[t]he Retained Limit is the amount set forth under . Item 4 of the Policy Declarations and shall apply to each claim.’ ” Id. at 497. We then quoted the applicable policy provision:

where a series of an/or (sic) several claims are made which are attributable directly or indirectly to the same event, condition, cause, defect or hazard or alleged defect or hazard or failure or alleged failure to warn of such, each and every- one of such claims shall be deemed to be separate and distinct from each and every other one of such claims and shall be treated as a separate and distinct claims occurrence from each and every other one of such claims irrespective of the period or area over which the claims occur or the number of such claims.

Id.

|inThis specific policy language caused this circuit in Trahan to conclude that a separate SIR applied to the plaintiffs injury claim and to each of the loss of consortium claims on behalf of his wife and children respectively. No such clarifying language appears in the present policy distinguishing one claim from multiple claims arising from the same pollution condition.

In Musmeci, 332 F.3d 339,352, the SIR provision contained only one line providing, “ ‘$250,000 each claim.’ ” The word “claim” was not defined in the policy. However, the court found that the meaning of the word “claim” for purposes of the SIR provision could be gleaned by reference to the use of the word in numerous other provisions in the policy. The court then found that its meaning was clear and unambiguous and that a “claim” was the assertion of a legal right against the insured by a third party. The distinction between the policy in Musmeci and the present case is that in Musmeci “claim” was not defined and it was used always in the singular, while in the present case the singular “claim” and plural “claims” are defined in the policy and mean the same thing.

In Maxim, 911 F.Supp. 239, two children died as a result of a defective heater. The SIR Endorsement in the manufacturer/insured’s liability policy stated: “‘The retention amount will apply on an each claim basis regardless of the number of claims arising out of one occurrence.’ ” Id. at 239. The coverage dispute was whether a suit brought by the father of the two children constituted one claim under the policy or two. The decision did not indicate whether or not the word “claim” was defined in the policy, but the court found that the only result it could reach under any reasonable interpretation of the word “claim” was that the word was unambiguous, and in that case there were two causes of action, two claims, and two retentions. The distinction |nbetween Maxim and our present case is the same as that we just described with Musmeci.

An insurance policy is a contract between the parties and should be construed by using the general rules of interpretation of contracts set forth in the Louisiana Civil Code. “Ambiguous policy provisions generally are to be construed against the insurer and in favor of coverage.” Carrier v. Reliance Ins. Co., 99-2573, p. 12 (La.4/11/00), 759 So.2d 37, 43. “[Ejquivoeal provisions seeking to narrow an insurer’s obligation are strictly construed against the insurer.” Id. While Evanston recognizes this rule, it invokes the equally settled rule that, for strict construction to apply, the insurance policy must not only be susceptible to two or more interpretations, but also each of the alternative interpretations must be reasonable. That is surely the law, but in the present case an interpretation favoring only one retention for whatever claims might be asserted for one pollution condition is a reasonable interpretation based on the policy language. “Interpretation of a contract is the determination of the common intent of the parties.” La.Civ. Code art. 2045; see also Cadwallader v. Allstate Ins. Co., 02-1637 (La.6/27/03), 848 So.2d 577. This policy is ambiguous and must be interpreted against the party who furnished its text. See La.Civ.Code art. 2056.

The trial court’s grant of summary judgment in favor of Evanston Insurance Company was based on its finding that there was no ambiguity in the policy and its finding that there was no coverage for more than one retention for this pollution condition. Based on our de novo review of the policy language, we find that the policy’s SIR coverage language was ambiguous. Consequently, the ruling was error as a matter of law. We will reverse the judgment and remand the third-party demand for further proceedings.

| ^DISPOSITION

For the reasons assigned, we reverse the judgment of the trial court and remand the third-party demand of Petroleum for further proceedings. Costs of this appeal will be borne by Evanston Insurance Company.

REVERSED AND REMANDED.

      . The trial court certified that the partial summary judgment was final for purposes of appeal, as authorized by La.Code Civ.P. art. 1915.

      . Several hundred plaintiffs were involved in the various suits.

      . By definition in the policy, a "pollution condition” is an occurrence.

      . The summary judgment rendered by the trial court was arguably inappropriate because there was no evidence that Petroleum, the insured, had satisfied an SIR of $100,000.00. Until Petroleum satisfied its deductible, or retention obligation, coverage under Evans-ton's insurance was not triggered, and the judgment in favor of Evanston could technically be affirmed for that reason. Evanston makes that point in its brief. However, the ultimate issue both the insured and the insurer wanted resolved by the cross-motions was how the SIR amount would apply. That issue was reached and decided by the trial court. Thus, whether the judgment is called a summary judgment or a declaratory order, by either name it decided the issue the parties wanted resolved and did so by use of the procedural device they chose as the vehicle for seeking that resolution. That being the case, and guided by the liberal construction precept of La.Code Civ.P. art. 5051, we recognize the subject matter as appropriately resolved by summary judgment.

      . The trial court found and the parties agreed that in this case "deductible” and "retention” are synonymous terms.

      . It appears that the wrong SIR Endorsement form was used by the insurer in putting this policy together. The SIR Endorsement form actually used stated it modified four coverages and listed them. We reproduced those four above in boldface. Coverage Part D of the policy is Contractors Pollution Liability Coverage, while the boldface coverage that most nearly corresponds to Part D by name is shown on the form as OWNERS AND CONTRACTORS PROTECTIVE LIABILITY COVERAGE. As demonstrated by other endorsements attached to the policy, these are two separate coverages. Thus, the SIR Endorsement does not expressly modify the Contractors Pollution Liability Coverage; expressly, it modifies Owners and Contractors Protective Liability Coverage, a coverage part not found in the policy in the record. However, despite the apparent use of the wrong SIR Endorsement form, the SIR amount “per claim'' written into the blocks farther down in the endorsement does expressly relate to Contractors Pollution Liability. Because it appears that the third-party plaintiffiinsured herein agreed that the SIR Endorsement form actually used did in fact modify the coverage, we mention the discrepancy but do not otherwise consider it in the resolution of the coverage issue in this case.

      . Evanston includes in its brief the .observation that the SIR Endorsement provides for $100,000.00 “per claimant.” That, too, is a misstatement. The endorsement does mot provide for an SIR "per claimant.” It provides for an SIR "per claim.”


source: Caselaw Access Project

author: SAUNDERS, Judge.

license: Public Domain

text:
    B & S UNDERWRITERS, INC. v. CONSTITUTION STATE SERVICES COMPANY, et al.
    No. CA 06-583.
    Court of Appeal of Louisiana, Third Circuit.
    Dec. 29, 2006.
    Kenneth Alfred Doggett, Alexandria, LA, for Plaintiff/Appellant, B & S Underwriters, Inc.
    John Patrick Doggett, Provosty, Sadler, & DeLaunay, Alexandria, LA, for Plaintiff/Appellant, B & S Underwriters, Inc.
    Jimmy Roy Faircloth, Jr., Faircloth & Davidson, L.L.C., Alexandria, LA, for Defendant/Appellee, Constitution State Services Company.
    Seth Andrew Sehmeeckle, New Orleans, LA, for Defendant/Appellee, Constitution State Services Company.
    Court composed of SYLVIA R. COOKS, JOHN D. SAUNDERS, and MARC T. AMY, Judges.
   SAUNDERS, Judge.

11 This cause of action arises from an alleged breach of a three party contract governed by Connecticut law and entered into in Louisiana. The parties consisted of an Insurer, a Manager and Constitution State Services, L.L.C. f/k/a Constitution State Services Company (hereinafter “CSSC”). The contract in question called for one of the parties, the Insurer, to pay a refundable initial service fee to CSSC. This initial service fee was refundable to the Insurer based upon conditions relating to the amount of money deemed as charges and fees received by CSSC.

The party deemed Manager under the contract brought this action claiming that CSSC owed- it the full refund of the initial service fee. It based this claim on CSSC improperly allocating money that should be deemed charges and fees as expenses.

CSSC filed an exception of no right of action due to the contract specifically stating that it was Insurer that has a claim, if any, to reimbursement of the initial service fee, and not Manager. The trial court dismissed this exception.

We reverse, and render.

FACTS AND PROCEDURAL HISTORY:

B & S Underwriters, Inc., (hereinafter “B & S”), ⅛ a managing general agent and third party administrator of' insurance products. B & S developed and owned the workers’ compensation insurance program issued by and licensed to Guarantee Mutual Life Company, (hereinafter “Guarantee Mutual”).

As a result of a regulatory requirement of the State of Georgia, B & S was unable to provide claims administration services for the workers’ compensation insurance sold in Georgia. B & S contacted CSSC, and entered into a contract wherein B & S and Guarantee Mutual transferred the entire open claims inventory and agreed to assign all future claims in the State of Georgia to CSSC for the provision of claims | ¡..services. In the 1994 contract, CSSC received a $1,000,000 initial service fee to protect against premature termination of the agreement due to incurring costs associated with setting up a place of business to handle the claims. The contract called for Guarantee Mutual to pay a $1,000,000 initial service fee to CSSC. This fee was to be reimbursed to Guarantee Mutual based upon certain thresholds being met by CSSC as they earned charges and fees. These reimbursements were to come when Guarantee Mutual submitted to CSSC, in writing, a request to have these reimbursements paid.

B & S brought a suit against CSSC for breach of contract. B & S alleged that it was owed reimbursement of the initial service fee. B & S served CSSC with its petition alleging that CSSC was using-an improper procedure in calculating charges and fees and propounded discovery to CSSC. B & S claimed that the 1994 contract could be interpreted to include allocated lost adjustment expenses in calculating charges and fees and under such method of calculating charges and fees, CSSC had reached the threshold to reimburse all of the initial service fee.

CSSC filed the peremptory exception of no right of action claiming that B & S, even if all of the allegations in its petition were true, had no remedy under the 1994 contract. The trial court denied this exception.

CSSC then filed an answer to the B & S petition but did not answer the propounded discovery. Instead, CSSC filed a motion for summary judgment alleging that there was no ambiguity in the 1994 contract that charges1 and fees did not include allocated loss adjustment expenses, and as such, it was entitled to a judgment as a matter of law. This motion was granted.

B & S applied for and was granted a rehearing on CSSC’s motion for summary | sjudgment. The trial court once again ruled in favor of CSSC’s motion. B & S appealed.

This court, on its own motion' pursuant to La.Code Civ.P. art. 927, can notice the peremptory exception of no right of action. The record reflects that B <& S has no right of action under the 1994 contract against CSSC for the reimbursement of the initial service fee. As such, we reverse the trial court’s ruling denying CSSC’s exception of no right of action and assess all costs of this appeal to B & S.

ASSIGNMENTS OF ERROR:

1. Did the trial court err in finding that there was no genuine issue of material fact regarding the interpretation and application of the contracts between Constitution State Services Company, B & S Underwriters, Inc. and Guarantee Mutual Life Company and that defendant/ap-pellee was entitled to judgment as a matter of law, by concluding that money deemed as “Allocated Lost Adjustment Expenses” was not to be included within “Charges and Fees” for purposes of calculating CSSC’s obligation to refund the Initial Service Fee?

2. Did the trial court err in failing to apply the “Annual Minimum Charge” defined in the 1994 contract for purposes of determining CSSC’s obligation to refund the Initial Service Fee?

3. Did the trial court err in granting CSSC’s motion for summary judgment prior to its answering of discovery propounded to it by B & S?

CSSC’S EXCEPTION OF NO RIGHT OF ACTION:

CSSC did not appeal the trial court ruling that dismissed its peremptory exception of no right of action. CSSC did submit some argument to this court that its exception of no right of action should have been granted, but did not claim it as an assignment of error. However, this court, on its own motion pursuant to La. Code Civ.P. art. 927, can notice the peremptory exception of no right of action. We choose to do so in this case.

Louisiana Code of Civil Procedure Article 927(B) states in pertinent part:

The nonjoinder of a party, or the failure to disclose a cause of action or a right or interest in the plaintiff to institute the suit, may be noticed by |4either the trial or appellate court of its own motion.

B & S asserts in its petition that it is entitled to the return of remnants of an Initial Service Fee from CSSC under section VII of a 1994 contract between B & S, Guarantee Mutual and CSSC. We find that B & S has no right of action under the 1994 contract for return of any of the Initial Service Fee paid by Guarantee Mutual to CSSC.

The test for the application of the peremptory exception of no right of action is whether the plaintiff has the capacity or legal interest to enforce the rights asserted in the petition. Babineaux v. Pernie-Bailey Drilling Co., 261 La. 1080, 262 So.2d 328 (1972). This exception is a threshold device that terminates suits brought by one who cannot enforce the right asserted judicially. Id.

“Whether a plaintiff has a right of action is a question of law.” Mississippi Land Co. v. S & A Properties II, Inc., 01-1623, p. 3 (La.App. 3 Cir. 5/8/02), 817 So.2d 1200, 1203.. Because this suit is before us on a motion for summary judgment, we have the record from below before us for review. We will review this question of law de novo from the record before us and from the substance of the contract upon which plaintiff has claimed its right of action. Id. Therefore, we look to the 1994 contract to make a determination of what rights, if any, B & S has in recouping the Initial Service Fee as it has claimed in its petition.

The parties agree that Connecticut law applies to the interpretation of the 1994 contract per the following choice of law provision:

SECTION XVII — APPLICABLE LAW
This Agreement shall be governed by the Laws of the State of Connecticut.

Louisiana Civil Code Article 3540 allows for choice of law provisions such as |sthe one in the 1994 contract “except to the extent that law contravenes the public policy of the state whose law would otherwise be applicable under Article 3537.” Louisiana Civil Code Article 3537 is the general article for selecting the law applicable to a contract. Under La.Civ.Code art. 3537 only Louisiana and Connecticut are states that could be chosen. We do not find any public policy that is offended in either state regarding this choice of law provision; therefore, we will apply Connecticut law.

Connecticut law is similar to Louisiana law when addressing the interpretation of contracts. A contract is interpreted so as to put into effect the intent of the parties. Niehaus v. Cowles Bus. Media, Inc., No. 16644 (Conn.4/22/03), 263 Conn. 178, 819 A.2d 765. The source in reaching the intent of the parties is the language used in the agreement. The language that the parties choose to put into the contract must be given its common usage and ordinary meaning. When this language is unambiguous, the contract is to be interpreted according to its terms. Courts are not to twist or torture words to attempt to import ambiguity where the substance of the agreement is clear. Any ambiguity that the court finds must come from the words in the contract itself, rather than one party’s idea of what the terms mean. Id.

Page one of the 1994 contract denotes that Guarantee Mutual will be referred to as “Insurer”, B & S as “Manager” and Constitution State Services Company as “CSSC”.

The 1994 contract reads as follows:

SECTION I — APPLICABILITY OF AGREEMENT
This Agreement is between Insurer, Manager and CSSC. However, the right afforded by, and the duties set forth in, each section of the Agreement (or paragraphs and subsections thereof) apply only to the parties specifically referenced therein.

|fiB & S claims it has a right to reimbursement of the Initial Service Fee under section VII of the contract, which states:

SECTION VII — CHARGES AND FEES
A. Charges and Fees earned by CSSC under this Agreement will be determined as follows.
1. CSSC will receive an Initial Service Fee of $1,000,000 payable by Insurer with $250,000 due June 9, 1994, and $250,000 due at the execution of this Agreement and $500,000 due August 1, 1994. If the Agreement is not executed by August 1, 1994, then $750,000 will be due on that date from the Insurer. The Initial Service Fee is fully earned upon payment and is non-refundable, except under the following conditions:
(a) If during the term of this Agreement of the Charges and Fees paid to CSSC by Insurer, excluding the Initial Service Fee, Start Up Charges and Termination Costs, exceed $5,000,000, then CSSC will return $500,000 of the Initial Service Fee to Insurer within 5 business days of receipt of Insurer’s written request for payment.
(b) If during the term of this Agreement the Charges and Fees paid to CSSC by Insurer, excluding the Initial Service Fee, Start Up Charges and Termination Costs, exceed $10,000,000, then CSSC will return the remaining $500,000 of the Initial Service Fee to Insurer within 5 business days of receipt of Insurer’s written request for payment, according to the following schedule:
Initial Service Total Chaz-ges and Pees Fee Returned
Greater Than or Equal to $10,000,000 and Less Than $11,000,000 $100,000
Greater Than or Equal to $11,000,000 and Less Than $12,000,000 $100,000
Greater Than or Equal to $12,000,000 and Less Than $13,000,000 $100,000
Greater Than or Equal to $13,000,000 and Less Than $14,000,000 $100,000
⅞7Greater Than or Equal to ¾000,000 $100,000

We find no reference to “Manager” in the relevant provision that B & S claims it has a right of reimbursement for the Initial Service Fee from CSSC. From the clear and unambiguous wording of the contract under section I, the right afforded by section VII, if any, is granted by the contract to “Insurer”, Guarantee Mutual, and not “Manager” B & S.

As such, we find that CSSC’s exception of no right of action should have been granted. B & S has no right of action under the 1994 contract for reimbursement of the Initial Service Fee. Accordingly, B & S cannot be afforded a remedy in this action. Therefore, we reverse the trial court’s ruling and grant CSSC’s peremptory exception of no right of action. Costs of the appeal are to be paid by B & S.

CONCLUSION:

We conclude that, based on the clear provisions of the 1994 contract, CSSC’s peremptory exception of no right of action shall be granted. The assignment of errors raised by B & S regarding whether Allocated Lost Adjustment Expenses should be included in the calculation of Charges and Fees, whether the Annual Minimum Charge should be applied and whether it was improper to grant CSSC’s motion for summary judgment when discovery was outstanding are moot, as B & S has no remedy against CSSC under the 1994 contract. Therefore, we grant CSSC’s exception of no right of action and dismiss B & S’s suit with prejudice. We assess all costs of this appeal to B & S.

REVERSED AND RENDERED.


author: GORBATY, Judge.

text:
    PARK PROPERTIES, L.L.C. v. METAL WORKS OF NEW ORLEANS, L.L.C.; GBII, L.L.C.; 1021 Development, L.L.C.; Glade B. Bilby, II; James V. St. Raymond; and Thomas J. Long.
    No. 2006-CA-0702.
    Court of Appeal of Louisiana, , Fourth Circuit.
    Dec. 29, 2006.
    Rehearing Denied Jan. 31, 2007.

      Richard C. Stanley, W. Raley Alford III, Stanley, Flanagan & Reuter, L.L.C., New Orleans, LA, for Plaintiff/Appellee.
    Phillip A. Wittmann, Michael Q. Walshe, Jr., Ashlee M. Robinson, Stone Pigman Walther Wittmann L.L.C., New Orleans, LA, for Defendant/Appellant.
    (Court composed of Judge MAX N. TOBIAS JR., Judge DAVID S. GORBATY, Judge EDWIN A. LOMBARD).
   GORBATY, Judge.

hln this appeal, defendants Metal Works of New Orleans, L.L.C., GBII, L.L.C., 1021 Development, L.L.C., Glade B. Bilby, II, James V. St. Raymond, and Thomas J. Long (collectively, “Metal”) appeal the trial court’s granting of plaintiff’s motion for partial summary judgment seeking specific performance. For the reasons set forth below, we affirm.

FACTS AND PROCEDURAL HISTORY

Metal purchased two properties in the Warehouse District, diagonally across the street from each other at 1020 and 1031 Annunciation Street for $1.1 million. Metal wanted to develop the two properties into an attractive, unique apartment or condominium development. The plaintiff, Park Properties, L.L.C. (“Park”) has particular skill and expertise in the planning, design, financing, construction, and management of multifamily apartment and condominium projects.

Metal and Park entered into a written Agreement for Joint Venture. The object of the Agreement was to develop and construct a 121-unit apartment or condominium complex on the Annunciation Street sites. Metal agreed to ^contribute the real estate that composes the project site, and Park agreed to manage all aspects of the project’s development and operation.

The Agreement contemplated funding of the Project through the Federal Housing Administration’s Section 221(d)(4) multifamily mortgage insurance program, which is administered by the United States Department of Housing and Urban Development (“HUD”). It was Park’s obligation under the Agreement to act as the project’s sponsor during the pre-application stage of the Section 221(d)(4) program. Successful completion of that stage meant receiving an invitation from HUD to apply for a “firm commitment” for mortgage insurance.

During the pre-application stage of the Section 221(d)(4) program, Park also was responsible for working with legal counsel on various organizational matters concerning the project, developing the project’s conceptual architectural plans and specifications, securing local zoning and regulatory approval for the project, and beginning the process of retaining a general contractor for the project.

Upon receiving the invitation from HUD, Park and Metal were required under the Agreement to organize a limited liability company that would purchase the project site from Metal, mortgage it to secure financing, and construct the complex. The parties agreed that Park would generally represent the new company, which would be named Metal Works Property Partners, L.L.C., in all aspects of the planning, development, construction, leasing, and operation of the project.

IsWhen the parties entered into the Agreement, they included an estimate of what it would cost to construct a 121-unit complex on the project site, and that estimate was attached as Exhibit A to the Agreement. Section 7 provided that either party could withdraw before the project’s completion if it took longer than eighteen months to obtain financing or the project’s actual costs or equity requirements exceeded the estimate set forth in Exhibit A:

7.1 The occurrence of any of the following events shall authorize either Ap-pearer to recede from this Agreement or withdraw as a Member of the Company without penalty except for the payment by the withdrawing Member of any amounts which may be owed by the withdrawing member in connection with this agreement as of the date of the withdrawal, to wit:
7.1.3 In the event the total cumulative development costs of the Project exceeds [sic] the total cost estimate set forth on Exhibit A by fourteen percent (14%) or more.

Park’s compensation for its efforts hinged on the project’s completion; it received no up-front fee. Thus, to protect its investment, Park bargained for the right to purchase Metal’s interest in the project and complete it upon Metal’s withdrawal. Section 8.2 of the Agreement reflects that bargain:

In the event Metal fails to contribute to the Equity or withdraws from the Project for any reason other than failure or refusal to execute the Venture Organization Documents within the Document Execution Deadline (“Metal Withdrawal Event”), Park shall have the right, privilege and option to purchase the Project, including the Project Site and all rights, privileges, servitudes and options related thereto from Metal for the price and on such terms as set forth in the purchase agreement described in Section 3.1.3.

Section 8.2 further provides for the sale of the “Project Site” within 180 days after Metal’s withdrawal at a time and place designated by Park.

Section 3.1.3 sets forth the terms of the sale described in Section 8.2. It provides:

|4Metal is the owner of the Project Site. Metal shall execute a purchase agreement with the Company for the sale of the Project Site for the sum of $1.1 million, payable all cash to the seller at the Initial Closing. In addition to the $1.1 million consideration paid for the Project Site at the Initial Closing, (i) in the event the HUD appraisal used in connection with the Final Closing (“Final Closing Appraisal”) values the Project Site greater than $1.1 million and equal to or less than $1.4 million, then at the Final Closing an amount equal to the difference between $1.1 million and the Final Closing Appraisal shall be paid by the Company to Metal, and (ii) in the event the HUD appraisal used in. connection with the Final Closing (“Final Closing Appraisal”) values the Project Site greater than $1.4 .million, then at the Final Closing $300,000 shall be paid by the Company to Metal and an amount equal to the difference between $1.4 million and the Final Closing Appraisal shall be paid by the Company fifty percent (50%) to Metal and fifty percent (50%) to Park.

Although the Agreement called for a 121-unit complex, and the $14.3 million total development cost estimate that was included in Exhibit A to the Agreement was based on a 121-unit concept, Park determined, after extensive study and consultation with Metal, that constructing 133 units might be more efficient and profitable in the long term. Thus, the parties agreed to explore, and the conceptual plans reflected, a 133-unit complex, which meant adding, another floor of residential units. With this addition, there was an increase in construction costs.

On July 24, 2003, Park principals met with Metal member-managers to discuss the status of the project. At the meeting, Park presented preliminary price estimates from four general contractors. Those initial estimates, which were based on the larger 133-unit design, ranged from $17,596,887 to $19,913,085. Park explained to Metal that it would not select a general contractor until after it had (1) received a second round of price estimates following scheduled meetings with | sthree of the contractors on August 4, 2003, and (2) conducted another round of negotiations in the light of the new estimates.

Four days later, on July 28, 2003, Metal sent Park a letter advising that Metal had elected to terminate the Agreement. Metal based its decision to withdraw from the project entirely on the contractors’ initial estimates and on Section 7.1.3 of the Agreement.

According to Park, Metal’s withdrawal from the project activated Section 8.2 of the Agreement. On September 12, 2003, Park exercised its right and option to purchase the project site and accepted unconditionally the terms of the option. Park scheduled the act of sale for January 14, 2004.

Park filed this action in October 2003 to obtain specific performance of Metal’s obligation to sell Park the project site in accordance with Sections 8.2 and 3.1.3 of the parties’ Agreement. The parties filed cross-motions for summary judgment in November 2003. The trial court denied both motions, and the parties proceeded with discovery.

After Park and Metal’s principals gave depositions, the parties filed cross-motions for partial summary judgment on the issue of whether the condition stated in Section 7.1.3 of the parties’ Agreement occurred on or before July 28, 2003. The trial court granted Park’s motion and denied Metal’s motion on November 23, 2004. To clarify procedural issues, Park filed a motion for summary judgment requesting specific performance in accordance with the trial court’s interpretation of the parties’ Agreement. On May 13, 2005, the trial court granted Park’s motion lfifor summary judgment and ordered Metal to appear at an act of sale within sixty days of its judgment. Metal subsequently filed this suspensive appeal.

DISCUSSION

Defendants assert that the trial court erred in concluding that Metal’s exercise of its right to “recede” from the Agreement “without penalty” triggered an option in Section 8.2 of the Agreement allowing Park to purchase Metal’s property for less than fair market value. Section 7.1.3 provides that Metal has the right to withdraw from the agreement “without penalty” if the development costs are too high. Metal basically argues that “without penalty” means without further obligation, liability or adverse consequences, and asserts that the provisions of Section 8.2 do not apply. In other words, according to Metal, its rescission from the Agreement had the effect of terminating the entire Agreement, including Section 8.2, such that the option in Section 8.2 no longer existed when Park purported to exercise it.

A contract is an agreement by two or more parties whereby obligations are created, modified, or extinguished. La. Civil Code art.1906. Upon an obligor’s failure to perform an obligation to deliver a thing, or not to do an act, or to execute an instrument, the court shall grant specific performance plus damages for delay if the oblige so demands. La. Civil Code art. 1986. Interpretation of a contract is the determination of the common intent of the parties. La. Civil Code art.2045. When 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’ 17intent. La. Civil Code art.2046. The words of a contract must be given their generally prevailing meaning. La. Civil Code art.2047.

Metal’s contention that “without penalty” means without obligation or liability finds no support in either prevailing usage or the law. According to Black’s Law Dictionary, a “penalty” is “[a]n extra charge against a party who violates a contractual provision.” Thus, the “without peiialty” language of Section 7.1 means simply that the withdrawing party cannot be required to pay money that it did not already owe on the date of its withdrawal. It does not mean or say that there are no consequences for a withdrawal, or that the remaining party has no rights or remedies. Metal’s further contention that the “without penalty” language confers a right to terminate the Agreement without being further burdened by any of its provisions, including any option in Section 8.2, is also incorrect. The four corners of the Agreement do not support that asserted meaning. Further, Metal’s withdrawal could not and did not render ineffective the provisions of the contract specifically governing withdrawals. If Metal’s interpretation is accepted, Section 8.2 of the contract would be rendered meaningless.

Metal also complains that, by enforcing Section 8.2 as it is written, the trial court unfairly penalized Metal by forcing it to sell the property at a price that is below current market value. However, the terms of the sale and price are set forth specifically in Section 3.1.3, which was agreed to by Metal. This assignment of error is meritless.

| ^Defendants next argue that the trial court erred in failing to conclude that the option in Section 8.2 of the Agreement was not exercisable under its own terms. The express preconditions in Section 8.2 to the exercise of the option were not met. Park wrongly assumes that by terminating the Agreement, Metal withdrew from the Project. The Agreement and the Project are not the same thing. Defendants claim that Metal did not withdraw from the Project, only from the Agreement; as such, the option in Section 8.2 could not be exercised.

The Agreement created and governed the project, and accordingly, Metal could not withdraw from the Agreement without also withdrawing from the Project. Metal acknowledged as much in its July 28, 2003 withdrawal letter, in which it expressly linked termination and withdrawal, and spoke of abandoning the “project” and the “project” not proceeding as planned.

Metal also contends that Section 8.2’s option never arose because “the failure or refusal to execute the Venture Organization Documents” for Metal Works Property Partners, L.L.C., is excepted from the definition of a withdrawal event. This argument is nonsensical. Section 8.1 addresses the failure or refusal to execute the Venture Organization Documents, and, by its own terms; it becomes active “ninety (90) days following the receipt of an invitation to submit for firm commitment from HUD.” The project had not received a HUD invitation before July 28, 2003, which made Section 8.1 inapplicable in determining Park’s rights and remedies upon Metal’s withdrawal. We find no merit to this assignment of error.

IflNext, defendants claim that the trial court erred in failing to conclude that Park did not properly exercise the option in Section 8.2 of the Agreement. Metal accuses Park of conditionally accepting the option under Section 8.2 in contravention of the Louisiana jurisprudence on the issue, contending that Park seeks only to purchase the “Project Site” and not the “Project.”

Park’s September 12, 2003 letter exercising the option provides that “Park unconditionally accepts the terms of the option.” Further, Metal’s efforts to create confusion between the “Project” and “Project Site” fail. The Agreement defines the “Project” as the “acquisition, financing, construction, development, leasing and operation of a multi-family unit apartment and/or condominium complex to be constructed on the Project Site (herein defined) as reflected on the approved plans and specifications.” Thus, the “Project” is the development of the property that composes the “Project Site,” and all architectural plans and specifications for that development were created by Park. As such, there is no additional property that Park could seek to exclude from its purchase right under Section 8.2.

Defendants further assert that the trial court erred in failing to recognize that the option in Section 8.2 was fatally indefinite and therefore unenforceable. First, Metal contends that the option cannot be enforced because it expresses no separate price for “portions of the Project other than the Project Site.” Section 8.2 clearly provides that the sale shall proceed according to the terms set forth in Section 3.1.3 of the Agreement. Moreover, Metal fails to identify a single “portion of the Project” defined in the parties’ Agreement for which a price is omitted.

|inSecond, Metal argues that the Agreement sets forth an indefinite price for the Project Site. However, Section 3.1.3 provides for the sale of the property for the price of $1.1 million. The back-end payment described in the third sentence of Section 3.1.3 is an obligation that could not be owed until after full ownership has transferred to Park; it is not part of the sale price. Thus, there is no doubt about the price that Park must pay at the Act of Sale: $1.1 million.

Metal also suggests that Park will not seek HUD financing, thereby depriving it of Section 3.1.3’s back-end payment. But Park obtained an invitation to apply for HUD financing after Metal withdrew from the Project, and the HUD appraisal would have been completed long ago if not for Metal’s refusal to sell Park the property.

Next, Metal contends that the Agreement is not “sufficiently definite” as to the time within which Section 3.1.3’s back-end payment must be made. In support of that contention, Metal cites cases that concern the payment of the credit portion of a purchase of real estate. These cases do not apply here because there is no credit portion. Section 3.1.3 makes clear that ownership transfers upon the payment of $1.1 million, “payable all cash.” Thus, the timing of the back-end payment has no bearing on the validity of Metal’s obligation to transfer the property.

Fourth, Metal argues that Section 8.2 cannot be enforced because it contemplates a sale to the “Company,” meaning Metal Works Property Partners, L.L.C. This company was never formed due to Metal’s withdrawal, but its nonJbrmationu does not affect the validity of the option. Section 8.2 expressly provides that Park has the right to purchase the project “from Metal.”

Fifth, Metal claims that Section 8.2 is unenforceable for failure to state a time within which the option must be exercised. Section 8.2 expressly provides that the sale must occur, and thus the option must be exercised, within 180 days after Metal’s withdrawal. Metal withdrew on July 28, 2003, and Park exercised its rights on September 12, 2003 — well within the 180-day limit. This assignment of error, including all of its subparts, lacks merit.

In their next assignment of error, defendants argue that the trial court erred in failing to conclude that Park’s prior material breach of the Agreement excused any further performance under the Agreement by Metal. Metal cites Sections 4.2 and 4.6 of the parties’ Agreement in support of its argument. Section 4.2 set forth Park’s obligation to develop architectural plans and specifications, first for the development of the financing package and later for the construction. Section 4.6 provided that Park would communicate with and direct “third party professionals as necessary to accomplish the business plan and financing.”

Park was fulfilling its obligations at the time of Metal’s withdrawal. It had completed the project’s conceptual design work; commissioned third-party reports that were necessary for the project’s financing package; drafted production drawings, plans, and specifications; begun price negotiations with general contractors; and submitted pre-application materials to HUD. Metal’s allegations of breach find no support in the record.

LgMetal also contends that the preliminary construction-cost estimates reviewed before the withdrawal reflected a breach of “implied obligations” or a lack of good faith by Park. However, the scope of the project had changed to a greater number of units after the parties executed the Agreement. Metal consented to exploring the 138-unit design, rather than 121 units, and was fully aware that adding an additional .floor to the development would increase costs. This assignment of error has no merit.

In their final assignment of error, defendants aver that the trial court erred in concluding that there were no material issues of fact preventing the granting of summary judgment in favor of Park. Defendants failed to brief this assignment of error, so under Rule 2-12.4 of the Uniform Rules of Court, it is deemed abandoned. Additionally, a review of the record reveals that there are no material disputed facts in this matter.

CONCLUSION

Accordingly, for the foregoing reasons, the judgment of the trial court granting summary judgment and ordering specific performance is affirmed. Metal must sell the property to Park in accordance with the provisions of Section 3.1.3 ■ of the Agreement.

AFFIRMED.


author: GASKINS, J.

text:
    Joe H. JACKSON, III, Plaintiff-Appellee, v. Ruthie WILLIAMS, Defendant-Appellant.
    No. 41,968-CA.
    Court of Appeal of Louisiana, Second Circuit.
    Jan. 10, 2007.

      Charles Kincade, for Appellant.
    Joe H. Jackson, III, In Proper Person-Appellee.
    Before WILLIAMS, GASKINS and SEXTON (Pro Tempore), JJ.
   GASKINS, J.

hThe defendant, Ruthie Williams, appeals the trial court judgment naming the plaintiff, Joe H. Jackson, III, as the primary domiciliary parent of the parties’ daughter. For the following reasons, we reverse the trial court judgment and remand for further proceedings.

FACTS

The parties are the parents of a daughter, A. W., born October 5, 1997. The parties were never married and there was no custody decree concerning the child. The plaintiff filed suit in April 2006 to obtain custody of his daughter. He sought sole custody of the child, arguing that it was in the best interest of the child. In the alternative, he sought to be named primary domiciliary parent.

A hearing on the matter was held on June 15, 2006. The plaintiff was represented by counsel. The defendant appeared in proper person. The parties made cross-allegations against each other of using drugs, frequenting nightclubs, and having illegitimate children.

At the trial, Ms. Williams was cross-examined by the plaintiff. She stated that she had lived in at least five different locations in the past several years. In addition to A. W., she has four other children, ranging in ages from 6 to 19. The oldest child no longer lives at home. Each child has a different father and Ms. Williams has never been married.

According to Ms. Williams, A. W., who was eight years old at the time of the hearing, has stayed with a variety of people during her short life. Ms. Williams stated that the child sometimes stayed with the plaintiff, her maternal grandmother, her uncle, and a friend of Ms. Williams, Terri | ¡.Outley, Ms. Outley kept the child from the time she was six months old until the age of four. At that point, Ms. Outley attempted to leave the state with the child. After the authorities intervened, the child stayed with Mr. Jackson and his family for approximately nine months. She then returned to Ms. Williams. After A.W. resumed living with her mother, Mr. Jackson had the child for visitation every weekend for 19 months.

Ms. Williams could not remember the last time she was employed. She supports her family with Social Security and child support payments. Ms. Williams admitted having convictions for fox-gery and attempted possession of marijuana. The record shows that she was charged with possession of marijuana and disturbing the peace arising from an incident occurring on October 30, 2005. On May 18, 2006, she entered a plea of guilty to attempted possession of marijuana and was given a probated sentence.

Mr. Jackson testified that he is employed and has lived in the same house for the past six years. He has been manned for 15 years; he and his wife have four children ranging in ages from 10 to 18. He objected to Ms. Williams frequently going to clubs and having abusive relationships with men. He claimed that Ms. Williams gets “beat a lot” and the children have to call the police. He claimed that A.W. has a good relationship with his family-

Angela Jackson, the plaintiffs wife, corroborated her husband’s testimony regarding the amount of time that A.W. has spent in their home. She stated that she is willing to have the child live in their home ^permanently. According to Mrs. Jackson, A.W. gets along well with her children. Mrs. Jackson stated that Ms. Williams goes to clubs frequently and has different boyfriends.

Ms. Williams took the stand and was questioned by the trial court. She claimed that the plaintiff fathered two other children, in addition to A.W., with other women during his marriage. She admitted that she has a boyfriend that frequently spends the night at her home. She denied having a drug problem, saying that she smoked marijuana 10 years ago but doesn’t any more. The court noted that she had a recent conviction for attempted possession of marijuana. During her colloquy with the court, Ms. Williams stated that she needed a continuance to try to obtain a lawyer. The trial court made no comment.

Ms. Williams claimed that Mr. Jackson decided to seek custody of A.W. only because she was seeking child support for their daughter. Ms. Williams also alleged that Mr. Jackson’s oldest son, who he does not acknowledge, has been in jail and was involved in a shooting, while her oldest child has no record and hopes to attend college. Ms. Williams asserted that Mr. Jackson and his wife are drug dealers and keep drugs in a shed behind their house. Ms. Williams pointed out that while she goes to nightclubs once a week, Mr. Jackson frequents the clubs almost every night. According to Ms. Williams, her children and the Jackson children attend the same school. Ms. Williams testified that she goes to the school almost every day for activities such as teacher appreciation meetings. She claimed that she has never seen Mrs. Jackson at the school.

14After the completion of the testimony in this matter, the trial court granted joint custody to the parties, but named Mr. Jackson as the custodial parent. Ms. Williams was granted visitation every other weekend. -In making its decision, the trial court noted that Mr. Jackson owns a house and has a job. Ms. Williams lives in a rented dwelling and is unemployed.

On July 6, 2006, Ms. Williams filed a motion for new trial. She claimed that the trial court erred in denying her motion for a continuance. She alleged that she requested a continuance to obtain a lawyer, but the request was denied. She claims that if she had had a lawyer, she would have been more effective in defending against the plaintiffs case. She also asserted that there was insufficient competent evidence to support the judgment. The trial court denied the motion for new trial. Ms. Williams appealed.

MOTION FOR NEW TRIAL-SUFFICIENCY OF THE EVIDENCE

In her motion for a new trial, Ms. Williams argued that there was insufficient evidence to support the trial court’s ruling which named Mr. Jackson as the primary domiciliary parent. This argument has merit.

La. C.C.P. art.1972 states in pertinent part:

A new trial shall be granted, upon contradictory motion of any party, in the following cases:
(1) When the verdict or judgment appears clearly contrary to the law and the evidence.

La. C.C. R. art.1973 provides:

A new trial may be granted in any case if there is good ground therefor, except as otherwise provided by law.

Un the present case, the plaintiff made numerous allegations regarding Ms. Williams’ character and parenting skills that were not denied by the defendant. However, Ms. Williams also made allegations that the Jacksons are involved with drugs, that Mr. Jackson goes to nightclubs almost every night, and that he has several children outside his marriage. Ms. Williams claimed that the only reason that Mr. Jackson sought custody of their child was to avoid paying child support. Ms. Williams claimed that Mrs. Jackson was not actively involved in the children’s schooling. Mr. Jackson did not refute these allegations.

Ms. Williams was unrepresented at trial, and claimed that she would have called witnesses to support her claims had she known that a hearing was to be .held on the date of trial. Also, Ms. Williams claimed that this matter was not first submitted to a hearing officer in accordance with the local court rules in the Fourth Judicial District. These factors, along with the serious nature of the allegations made by each party against the other, which were mostly unrefuted, combine to produce a situation in which the trial court did not have adequate evidence to support the judgment naming Mr. Jackson as the domiciliary parent of A.W.

Accordingly, we reverse the trial court judgment and remand this matter to the trial court. The trial court is instructed to follow the applicable | Brules, including submission of this case to a hearing officer. The hearing officer is specifically directed to conduct home studies of each party and other measures in accordance with local court rules. The hearing officer and the trial court shall apply the “best interest of the child” standards in determining which party is to be the primary domiciliary parent. See La. C.C. art. 131.

CONCLUSION

For the reasons stated above, we reverse the trial court judgment naming Mr. Jackson as the primary domiciliary parent of- A.W., based on insufficiency of the evidence. A new trial is ordered in this matter in accordance with law and the applicable court rules of the Fourth Judicial District Court. This matter is remanded to the trial court for further proceedings. Costs in this court are assessed to the plaintiff, Joe H. Jackson, III.

REVERSED AND REMANDED.

SEXTON, J., (Pro Tempore), concurs in the remand.

      . See Fourth Judicial District Court Rules for Family and Domestic Relations Proceedings, Rule 27.1, which provides in pertinent part that:
      A. After filing initial pleadings on the Family Docket, all parties will be required to attend a Hearing Officer Conference with a Hearing Officer unless waived by the assigned judge for unusual and exceptional circumstances shown, and to provide documentation to the Hearing Officer and the other party in accordance with any order(s) issued by the court....

      . In the present case, because we find that there was insufficient evidence upon which to base the trial court's decision, and because we remand for further proceedings, we do not reach the issue of the denial of a continuance in this case.


text:
    STATE of Louisiana, Respondent, v. Manuel DUQUE, III, Applicant.
    No. 42,074-KW.
    Court of Appeal of Louisiana, Second Circuit.
    Jan. 18, 2007.

      Snell and Robinson, by Aubrey R. Snell, for Applicant, Manuel Duque, III.
    John Schuyler Marvin, District Attorney, Michael 0. Craig, Assistant District Attorney, for Respondent, State of Louisiana.
    Before BROWN, STEWART and GASKINS, JJ.
   JjWRIT GRANTED.

The defendant, who is the executive director of the Bossier Office of Community Services, Inc. (“BOGS”), is charged by bill of information with four counts of malfeasance in office pursuant to ..La, R.S. 14:134. On May 4, 2006, the defendant filed a motion to quash the bill of information, wherein he alleged that he was not a public officer or a public employee, which is an element of the offense, because the organization for .which he works is not a public agency. The trial court conducted a hearing and later issued an order denying the motion to quash, finding that the BOCS is a public agency and that, therefore, the defendant' qualified as a “public officer” or a “public employee.”

A plain reading of La. R.S. 14:134, the statute defining “malfeasance- in office,” indicates that being a “public officer” or “public employee” is an element of the offense. The terms “public officer” and “public employee” are defined as follows by La. R.S. 14:2(9):

(9) “Public officer,” “public office,” “public employee” or “position of public authority” means and applied to any executive, ministerial, administrative, judicial, or legislative officer, office, employee or position of authority respectively, of the state of Louisiana or any parish, municipality, district, or other political subdivision thereof, of any agency, board, commission, department or institution of said state, parish, municipality, district, or other political subdivision.

^Therefore, it is necessary to determine whether BOCS is a public agency in order to determine whether defendant may be charged as a “public official” or “public employee” with malfeasance in office pursuant to La. R.S. 14:134.

In State v. Smith, 357 So.2d 505 (La. 1978), the Louisiana Supreme Court addressed the issue of whether employees of a private corporation performing public services were “public officers” or “public employees” and could be convicted of malfeasance in office under La. R.S. 14:134. The defendants in Smith were employees of a private, nonprofit corporation formed under Title 12 of the Revised Statutes with articles of incorporation filed with the Secretary of State. State v. Smith, 357 So.2d at 506. In Smith, the court noted that the corporation had been formed in 1965 to avail itself to The Economic Opportunity Act, as codified in 42 U.S.C. § 2781, et seq., and had been designated as a community action agency. State v. Smith, supra. Similarly, BOCS was formed in accordance with Title 12 of the Revised Statutes through articles of incorporation executed on June 27, 1978, and filed with the Secretary of State, wherein it declared itself a nonprofit corporation with the purpose of operating a community action program for Bossier Parish in accordance with The Economic Opportunity Act of 1964.

The court noted that The Economic Opportunity Act allowed both public entities and private, non-profit agencies to fill the role of community action agency. State v. Smith, 357 So.2d at 506-507. The court rejected the argument that receiving public funds made an organization a public entity and, rather, adopted the following factors in determining whether an entity is a state or public agency: (1) the entity was created by the legislature; (2) the powers were specifically defined by the legislature; (3) the property of the entity belonged to the public; and (4) the entity’s functions were exclusively of a public character and performed solely for the public benefit. State v. Smith, 357 So.2d at 507. The court ultimately concluded that the defendants could not be considered public officers or public employees under the statutory definition because their corporation was not a state agency, stating that “those who are not clearly included by the terms of a criminal statute are excluded.” State v. Smith, 357 So.2d at 508.

In Bankston v. Board of Ethics for Elected Officials, 1998-0189 (La.6/22/98), 715 So.2d 1181, the Louisiana Supreme Court revisited the issue of whether a community action agency for Tangipahoa Parish known as “Quad Area” was considered as a public agency and reaffirmed its earlier four-part test from State v. Smith, supra, for determining whether an entity should be classified as a public agency. Bankston v. Board of Ethics for Elected Officials, 715 So.2d at 1185-1186. Similar to BOCS, Quad Area had been created in 1976 as a private, nonprofit corporation under Title 12 of the Revised Statutes, before enactment of the communication action legislation of La. R.S. 23:61 et seq. in 1982, and before it was designated as the official community action agency of Tangi-pahoa Parish. Bankston v. Board of Elected Officials, 715 So.2d at 1185. The court noted that Quad Area had not been created by a special act of the Louisiana Legislature or Constitution and that “[t]he enactment in 1982 of the community action legislation found at LSA-RS 23:61 et seq. did not transform Quad Area into a creature of the Legislature.” Bankston v. Board, of Elected Officials, supra. The court also found that Quad Area was to be considered a private organization under La. R.S. 28:64.1(E) because it had originally designated itself as a private organization and had not designated itself otherwise prior to October 1,1994. Bankston v. Board of Elected Officials, 715 So.2d at 1186. Thus, the court implicitly recognized that Quad Area was the only entity that had the authority to designate itself as anything other than a private, nonprofit organization, in spite of Tangipahoa Parish having 13designated it as its official community action agency.

In the present case, the trial court found that BOCS had been declared a public agency by the Bossier Parish Police Jury pursuant to La. R.S. 23:64(E) in a meeting on September 27, 1994, and the state argues that it was created by an act of the Louisiana Legislature as codified in La. R.S. 23:64.1. In 1982, the Louisiana Legislature enacted the community action legislation codified in La. R.S. 23:61 et seq. and thereby established “a procedure for the designation of community action agencies; fixing the responsibilities of community action agencies; defining community action programs; and establishing a formula for the allocation of community service block grant funds.” La. R.S. 23:61. According to La. R.S. 23:62(1), the community action legislation clearly allows both public agencies and private, nonprofit organizations to be appointed as community action agencies and, according to La. R.S. 23:63(A), the parish governing authority has the power to designate what entity serves as the community action agency on an annual basis.

The legislation sets out how a community action agency should be governed in La. R.S. 23:64.1, and in Subsection E, it states that “[a]n entity designated as a community action agency shall be considered a private, nonprofit organization unless it establishes otherwise by October 1, 1994 or upon its initial designation if such occurs after such date.” A plain reading of the entire statute indicates that the “entity” determines whether it is considered a private, nonprofit organization, and the Court implicitly held as much in Bank-ston v. Board of Elected Officials, supra. Therefore, the Bossier Parish Police Jury did not have the authority to convert BOCS from a private, nonprofit corporation to a public agency. The articles of incorporation for BOCS designated it as a private, nonprofit corporation, and there is no evidence that it ever designated itself as anything else prior to October 1,-1994. Further, the state’s claim that BOCS was created by the legislation codified in La. R.S. 23:64.1 is clearly without merit because BOCS'was created by articles of incorporation executed in 1978, and the legislation in La. R.S. 23:61 et seq. was not passed until 1982.

Applying the four-part test from State v. Smith, supra, to the present case, BOCS is a private, nonprofit corporation and not a public agency. As such, the officers and employees of BOCS are not public officers or public employees as defined by La. R.S. 14:2(9). Accordingly, the officers and employees of BOCS cannot be prosecuted for malfeasance in office as defined by La. R.S. 14:134 because the statute only allows public officers and public employees to be prosecuted for such. Therefore, the trial court erred in denying defendant’s motion to quash the bill of information charging him as an officer of BOCS with malfeasance in office, and the writ is granted.