text:
    William R. LeBLANC, Plaintiff-Appellee, v. OPT, INC., et al., Defendants-Appellants.
    No. 82-196.
    Court of Appeal of Louisiana, Third Circuit.
    Oct. 13, 1982.
    Rehearing Denied Dec. 2, 1982.
    Provosty, Sadler & deLaunay, Frederick B. Alexius, Alexandria, for defendants-ap- • pellants.
    William E. Skye, Alexandria, for plaintiff-appellee.
    Before DOMENGEAUX, DOUCET and YELVERTON, JJ.
   YELVERTON, Judge.

From a judgment awarding William R. LeBlanc, a real estate developer, $132,950 based on quantum meruit, the defendants Opt, Inc. and Richard Friedberg appeal. Richard Friedberg additionally appeals the trial court decision that the corporate defendant was his alter ego and that he is individually liable. Plaintiff answered the appeal seeking an increase in the award.

In 1975 Opt, Inc., a Louisiana Corporation, acquired an 86 acre tract of unimproved land on McArthur Drive in Alexandria, Louisiana. The purchase price was $892,500. The ultimate purpose of the acquisition was the development and sale of the property for both commercial and residential uses. Opt, Inc. was wholly owned by Richard Friedberg, an investor and real estate developer.

In March, 1977, William J. LeBlanc, a real estate broker and developer in Alexandria, met with Friedberg in Baton Rouge at the corporate office of Opt, Inc. The two were brought together by mutual friends. The purpose of the meeting was the development of the 86 acres, known as North Village. At this meeting they discussed general plans for the development. A second meeting in early April was held to discuss the development in more detail. At the April meeting LeBlanc was employed by Opt to prepare the plans and develop and sell the property.

LeBlanc went to work immediately. He was given an office, a secretary, and an expense account. He was also paid $2,500 a month. Five months later this was reduced to $1,750. In January 1980 he was terminated.

LeBlanc worked full time for Opt during the 34 months of his employment, from April 1977 to January 1980. During this time he was paid a total of $45,050. After he was terminated he brought this suit seeking damages of $311,370 based on contract. In the alternative, he asked for an award of $281,670 based on quantum meru-it. The defendants denied any indebtedness, basically contending that LeBlanc was simply a salaried employee working by the month.

The trial court concluded that contract damages were not recoverable because no contract was proved. No written contract was ever signed. Although two written instruments were signed by LeBlanc and tendered to Friedberg, the latter refused to sign them. The trial judge also concluded that no verbal contract was proved because the evidence did not preponderate in favor of either party’s version of their arrangement. The court accordingly held that the will of both parties did not unite on the same point, there was no consent given to any particular agreement, and therefore no contract existed between them.

Based on our review of the record, we agree with the trial court as to these factual conclusions.

The basic contention on appeal is whether plaintiff is entitled to recover in quantum meruit. The defendants-appellants resist any recovery at all, insisting that LeBlanc was employed by the month on a salary, and that he could quit any time and they could fire him at any time. Defendants agreed that there had been some discussion concerning LeBlanc’s exclusive listing rights and his potential entitlement to realtor’s fees. The parties sharply disagreed, however, as to the details, but there was enough evidence of realtor fees being contemplated by the parties for the trial court to be convinced that something considerably more than a mere month-to-month salary was envisioned, and we are also convinced that this is so. The trial judge noted that LeBlanc’s total salary ($45,050) for his three years of employment was “an incredibly low figure for the services he rendered, in light of his prior real estate developments and expertise therein”.

It is at this point that quantum meruit becomes the operative doctrine. Quantum meruit is an equitable doctrine, based on the concept that no one who benefits by the labor and material of another should be unjustly enriched thereby. Under those circumstances the law implies a promise to pay a reasonable amount for the labor and material furnished, even in the absence of a specific contract therefor. Gauguin, Incorporated v. Spring, 316 So.2d 858 (La.App. 3 Cir.1975).

In determining that LeBlanc was entitled to recover in quantum meruit, the trial judge found that the actual value of Le-Blanc’s services far outweighed what he was actually paid. The trial court also found that the defendants had been enriched by much more than the amount Le-Blanc was actually paid.

The record thoroughly supports these conclusions. When plaintiff began work in 1977, the property was a tract of raw, unimproved land. He furnished the defendants with a concrete plan to develop the entire tract for commercial use, and single-family residential and multi-family residential use. The whole tract has been subdivided. All the work was done that was required to have the project approved by the City of Alexandria. LeBlanc encountered considerable difficulty, including public opposition regarding zoning requirements, but succeeded in getting the property properly zoned for the development to proceed. All of the engineering and construction has been completed relative to the drainage, water, sewer, gas, and electrical facilities. The main commercial street, North Boulevard, as well as Lacassine Drive and the first stretch of Tunica Drive have been designed and constructed. The largest single contract which LeBlanc let and supervised in the development was over $500,-000.

LeBlanc performed additional work beyond that which was contemplated by the development of the tract. He obtained Days Inn motel franchises for Opt in the four cities of Alexandria, Lafayette, Houma and Monroe. A completed package for a Days Inn construction on North Village was prepared. LeBlanc handled a $199,000 land purchase in Lafayette for a Days Inn construction site. The benefits this work provided defendants were summed up by the trial judge as follows:

“Opt, Inc. now owns a valuable piece of developed land. If they wished to begin constructing houses, apartments, or businesses on the tract tomorrow, they could. This would not be possible without plaintiff’s efforts. Further, LeBlanc gave Opt, Inc. a completed package for the construction of the Days Inn on the tract. If the money becomes available, construction could begin immediately.”

The trial court awarded LeBlanc $178,000 as the amount he deserved for his efforts in developing North Village from raw land to an established commercial and residential subdivision, together with his efforts on the various motel projects at Richard Fried-berg’s request. From this total the trial court deducted the $45,050 previously paid LeBlanc on a monthly basis, leaving a net judgment amount of $132,950. This amount was obviously based on the testimony of Hab Monsur of Alexandria, an expert in real estate and development, who was the only expert to testify in the case. Mr. Monsur was present throughout the trial, reviewing all of the exhibits, and was personally acquainted with the before and after condition of North Village. Our review of the record causes us to agree with the trial court that the amount awarded was reasonable and equitable and should be neither decreased nor increased.

The other major issue on appeal was whether Richard Friedberg should be held personally liable. The trial court concluded that he should, on the theory that Opt, Inc, was merely the alter ego of Friedberg.

The trial court found the following facts to pierce the corporate veil:

“Defendants’ exhibits D-18, D-19, and D-20 show that Cinema Shares International, Inc. was the record owner of 5,000 shares in Opt, Inc. on December 5, 1975. On January 1, 1976, these shares were transferred to Omni Capitol Worldwide, Ltd.; then, on August 1, 1979, these shares were transferred to Richard Fried-berg.
“However, the evidence clearly shows that Cinema Shares International, Inc. and Opt, Inc. were both subsidiaries of Omni Capitol Worldwide, Ltd. In fact, Omni Capitol was the parent company for at least fifteen Louisiana corporations. Friedberg testified that he controlled all of these corporations. Further, Fried-berg owned eighty percent of Omni Capitol Worldwide, Ltd. at all relevant times. (See P-2, page 10.) Although Friedberg did not personally own stock in Opt, Inc., he was, in fact, the owner.
“Further, it is clear that Friedberg tended to use these corporations in his business projects, and to mix their affairs. North Village was actually to be developed by two corporations: Opt, Inc. owned the land, but North Village Development Company was to develop it. Also, Friedberg admitted that he transferred funds freely between all of his companies. David Purcell testified that this was done on a daily basis. Richard Friedberg said that it was done two or three times a week. He testified that he could pick up the phone and tell the bank to transfer a couple of hundred thousand dollars from the account of one corporation to another corporation, and that he had done so on numerous occasions (P-2, pages 68, 69). He also said that he had blanket authority in the minutes of each corporation to make these loans, and that the loans were ratified at a board of directors meeting of each corporation each year.
“The evidence also shows that many corporate formalities were not observed. Although the defendants introduced forty documents dealing with the corporate operations of Opt, Inc., only one of them represented the minutes of a shareholders meeting, and that one was held in 1974 (D-4). Further, the exhibits show seventeen board of directors meetings. Of these, thirteen are special meetings. None of them is denominated an annual meeting, and all of them deal with one topic alone — authorizing a person to buy, sell, or deal in real estate. These minutes do not reflect any other function of the board of directors. Friedberg admitted that the only minutes that were ever kept dealt with this subject alone, and were drawn up solely to provide the necessary authority to allow individuals to deal in real estate for the corporation (P-2, page 66).
“This Court also notes that at the first shareholders meeting (D-5) Richard Friedberg was elected secretary-treasurer of the corporation. Yet, at a board of directors meeting held the next month W.L. Ryder, who had been elected vice president, signed the minutes as secretary. Reviewing the minutes of the rest of the board meetings, five different people sign as either a secretary or vice president. There is no indication of when these officers were elected by the board of directors as required by the Louisiana Business Corporation Act. LSA R.S. 12:82. This matches David Purcell’s testimony that Friedberg often told him to sign documents as an officer of the corporation but that he was never elected to any office.
“Finally, it is clear to this Court that Friedberg dominated the affairs of the corporation. Plaintiff testified that Friedberg approved the use of a contract negotiation rather than bids on the street and drainage contract, approved the contract to install street lights, approved the idea and plans to use prefabricated houses, agreed to build twenty-five of them, agreed to at least one of the commercial development ideas and was constantly kept appraised of all new developments. Friedberg disputed some of this testimony; however, it is apparent that he was in almost constant contact with Mr. Le-Blanc. For example, an examination of Mr. LeBlanc’s telephone records (P-19) shows at least one phone call between LeBlanc and Friedberg on virtually every page. Friedberg admitted these calls, and approving all the expenditures (P-2, page 32). In his deposition, Friedberg testified that LeBlanc was to present plans for the project, which he, as owner, had the right to veto or approve (P-2, page 24). He also admitted that LeBlanc was furnished an office at his direction, that LeBlanc’s draw was reduced and then cut off at his direction and then he or someone at his direction fired LeBlanc (P-2, pages 46, 47, and 63). In fact, Friedberg testified that there was to be no written contract with plaintiff because he wanted to reserve the right to dismiss him at will (P-2, page 69).
“There are other indications scattered throughout plaintiff’s exhibits that third parties understood that the decision to continue or discontinue the projects rested solely with Friedberg. This Court is satisfied that he disregarded corporate formalities and entities, and so dominated the operations of Opt, Inc. that the corporation was, in fact, his alter ego. Therefore, LeBlanc should be allowed to recover a personal judgment against him.”

The legal principles concerning this issue were stated in Kingsman Enterprises, Inc. v. Bakerfield Electric Company, Inc., 339 So.2d 1280 (La.App. 1 Cir.1976) as follows:

“The general rule that corporations are distinct legal entities, separate and distinct from the individuals who compose them, is statutory in origin and well recognized in the Louisiana jurisprudence. La.C.C. art. 435; Buckeye Cotton Oil Company v. Amrhein, 168 La. 139,121 So. 602 (1929); Texas Industries, Inc. v. Dupuy & Dupuy Developers, Inc., supra; Johnson v. Kinchen, 160 So.2d 296 (La. App. 1st Cir.1964). Thus, shareholders are not individually responsible for the debts due by the corporation. La.C.C. art. 437; La.R.S. 12:93(B); Texas Industries, Inc. v. Dupuy & Dupuy Developers, Inc., supra.
“There are, however, limited exceptions to the rule of non-liability of shareholders for the debts of a corporation whereby the court may ignore the corporate fiction and hold the individual member or members liable. In such situations courts commonly refer to the corporation as the ‘alter ego’ of the shareholder. One such exception to the non-liability rule involves situations where fraud or deceit has been practiced on a third party by the shareholder acting through the corporation. La.R.S. 12:95; Bossier Millwork & Supply Company v. D. & R. Construction Company, Inc., supra.
“Another basis for disregarding the corporation entity involves the failure to conduct a business on corporate footing, thereby disregarding the corporate entity to such an extent that the corporation ceases to be distinguishable from its shareholders. Gordon v. Baton Rouge Stores Company, 168 La. 248, 121 So. 759 (1929); Brown v. Benton Creosoting Company, 147 So.2d 89 (La.App. 2d Cir. 1962). In Louisiana, courts usually base this rule upon the often-quoted language of Keller v. Hass, supra:
‘It is well settled that where an individual forms a corporation of which he is the sole and only stockholder or owns such control of the stock that the act of the corporation is his own, then he may not use the screen of corporate entity to absolve himself from responsibility. [Citations omitted]’ 12 So.2d at 240
“However, the broad language quoted gives little indication as to what circumstances justify piercing a corporate veil absent fraud on the part of the shareholder. (footnote omitted) In fact, courts in cases involving issues of shareholder liability often fail to clearly enunciate the bases for disregarding corpo-rateness under which they seek to hold the shareholder liable. This confusion of the grounds for disregarding corporate identity may occur because circumstances exist which support piercing the corporate veil because of both fraud and the failure to operate the corporation on a corporate footing distinct from the shareholder’s personal identity. Also, the failure of a shareholder to adequately separate the corporation’s identity from his own because of various factors may lead to fraud or deceit. Regardless of the basis for piercing the corporate veil, it is clear that the situation must be viewed with regard to the totality of circumstances in each case. However, it should be kept in mind that in Louisiana the concept of the separation of the corporate entity from its shareholders is the general rule and is firmly established. Because of the beneficial role of the corporate concept, this principle should be disregarded in only exceptional circumstances. Johnson v. Kinchen, supra.
That court also listed the factors which would justify piercing a corporate veil absent fraud on the part of the shareholder.

These factors were: co-mingling of corporate and shareholder funds; failure to follow statutory formalities for incorporation and the transaction of corporate affairs; failure to provide separate bank accounts and records; and failure to hold regular shareholders’ or director’s meetings.

Whether the doctrine is to be imposed is primarily a factual finding best made by the trial court. Smith-Hearron v. Frazier, Inc., 352 So.2d 263 (La.App. 2 Cir. 1977), writ denied 353 So.2d 1337 (La.1978).

In the present case the trial court found that Friedberg failed to conduct Opt, Inc. on a corporation footing to the extent that the corporation ceased to be separate from Friedberg. The record clearly established that Friedberg had control of Opt, Inc., that he failed to hold regular shareholder and director’s meetings, that he failed to follow statutory formalities in the transaction of corporate affairs, and that he freely co-mingled funds from one corporation to the other.

The evidence also reveals that the decision to employ LeBlanc to be project manager, the decision to give the plaintiff a commission, the decision to discontinue the projects and the decision to release the plaintiff from his employment without just compensation rested solely with Friedberg. For three years the plaintiff attempted to secure a written contract of employment with Friedberg and Opt, Inc. For three years plaintiff worked under the representation that he would eventually be able to secure commissions on the sale of the property. Friedberg freely admitted that he made these representations to the plaintiff. After the plaintiff worked in readying the property for commercial sales, Friedberg decided to discontinue the project as well as plaintiff’s employment without proper compensation for his services. Such representations and dealings, such as here, almost amount to an attempt to defraud.

Under these circumstances in order to prevent such an injustice we find that the trial court properly disregarded the corporate veil and held Friedberg personally liable.

There are two remaining issues on appeal which we now address. One is the contention of plaintiff that the trial court erred in awarding interest from the date of judgment instead of from the date of judicial demand. The trial court was correct. The law is well established that interest on an award based on quantum meruit is allowed only from the date of final judgment. Succession of Butler, 294 So.2d 512 (La. 1974); and Smith v. McMichael, 381 So.2d 898 (La.App. 2 Cir.1980).

The remaining issue is whether the trial court erred in assessing to plaintiff one-half of the costs of the trial proceedings. We are inclined based on our appreciation of the facts to agree that this was error. Although under LSA-C.C.P. Art. 1920, the trial court has broad discretion in the assessment of costs, this discretion is not unbounded. Gonzales v. Southwest Mobile Homes, Inc., 309 So.2d 780 (La.App. 3 Cir.1975); writ denied, 313 So.2d 239 (La.1975); and Slater v. Slater, 410 So.2d 1197 (La.App. 3 Cir.1982). In the absence of some equitable or other good reason, costs generally follow the final judgment in favor of the prevailing party. Greenburg v. Fourroux, 300 So.2d 641 (La.App. 3 Cir.1974), writ denied 303 So.2d 181 (La.1974).

The reason given by the trial court for dividing costs was that the present litigation could have been avoided if the “parties had not run their affairs on such a loose basis”. We cannot agree that this was a factually sound basis for splitting costs. Plaintiff repeatedly attempted to secure a written contract from Friedberg which would have formalized the obligations of each party. These efforts were unsuccessful. Not until trial did it become apparent why the proffered contracts were not even considered. Friedberg testified it was never his intention to sign an employment contract because this was against his business practice. Under these circumstances it was clearly wrong to cast plaintiff with part of the costs.

For the reasons assigned, the judgment of the trial court is affirmed, except that the judgment assessing half the costs to the plaintiff is reversed and all costs, both at trial and on appeal, are hereby assessed to the defendants.

AFFIRMED in part, REVERSED in part, and RENDERED.


source: Caselaw Access Project

author: STOKER, Judge.

license: Public Domain

text:
    MAGNOLIA CONSTRUCTION COMPANY, INC., Plaintiff-Appellant, v. Vernon CAUSEY, et al., Defendants-Appellees.
    No. 82-162.
    Court of Appeal of Louisiana, Third Circuit.
    Oct. 13, 1982.
    Rehearing Denied Dec. 2, 1982.
    Writ Denied Feb. 4,1983.

      John P. Navarre, Oakdale, for defendants-appellees.
    James K. Nichols, DeRidder, for plaintiff-appellant.
    Before FORET, CUTRER and STOKER, JJ.
   STOKER, Judge.

This is a breach of contract suit by plaintiff, Magnolia Construction Company, Inc. (Magnolia), against defendants Cafi Company, Inc. and its president, Vernon Causey (Cafi), seeking damages for increased costs resulting from the defendants’ failure to finish work it had contracted to do and for the costs of repairing defendants’ defective work. The defendants reconvened for loss of profit because Magnolia allegedly failed to contact them to return to the job site, thus breaching the contract.

The trial judge entered judgment for plaintiff on the main demand, and dismissed defendants’ reconventional demand. The plaintiff appeals, asking that this court award a greater amount of damages than that awarded by the trial court. The defendant appeals, asking that the trial court be overturned and judgment be granted on its reconventional demand.

' We reject plaintiff’s request. Plaintiff has not shown that the trial court was clearly wrong in finding that only 50% of the work repaired was solely caused by Cafi’s negligent performance of its duties. However, we find merit in defendants’ appeal and reverse that portion of the judgment dismissing defendants’ reconventional demand. We find that plaintiff breached the subcontract by hiring another subcontractor instead of notifying Cafi to return to work, as required by the subcontract. Accordingly, we affirm that portion of the trial court’s judgment in plaintiff’s favor and enter judgment for Cafi Company, Inc. and Vernon Causey on the reconventional demand and award damages thereon.

FACTS

Magnolia was the main contractor and Cafi was hired by them to do subcontracting work on a project for the City of DeRid-der. The work involved laying new sewer lines and connecting them to private residences. According to the contract, Cafi was only obligated to jack and bore (bore the holes in which the lines would be laid and put the pipe in them) and make tie-ins (connect the lines Cafi laid with the main sewer lines). After completing most of the work, Cafi left the job in November, 1978, but left its boring and jacking equipment in DeRidder. Magnolia claimed that the weather was bad and that Cafi obtained permission to stop working until the weather improved. Cafi contends it left because it had been told by Magnolia that no more streets would be bored at that time because of problems arising from running into existing utility lines. Cafi maintained that when it left in November it had only two or three bores left to do and that was why it left its equipment in DeRidder, and that it intended to return and complete the work when notified by Magnolia.

Magnolia maintained that in January and February it attempted to contact Cafi to get it to return to work but was unsuccessful. In January or February, Magnolia employed another subcontractor, Glen Frost, to complete Cafi’s work. Cafi contends it was never notified by Magnolia to return to work until long after Frost had been employed to complete the work. When in March and April of 1979 it was discovered that the sewer lines in the area were defectively installed, Magnolia began to make repairs and subsequently filed this suit.

I.THE RECONVENTIONAL DEMAND.

There are three issues to be decided regarding the reconventional demand:

1. Was Cafi hired by Magnolia to do the subcontracting work involving jacking and boring that was eventually done by Glen Frost?

2. If so, was the contract mutually terminated before Cafi left the job site in November of 1978? (If there was no mutual termination by the parties, the hiring of Glen Frost to complete the jacking and boring was a breach of contract by Magnolia, and Cafi is entitled to damages.)

3. If the contract was not mutually terminated in November, 1978, has Cafi introduced sufficient evidence to allow this court to make an award to it?

CAFI WAS HIRED TO DO THE JACKING AND BORING DONE BY GLEN FROST

The subcontract contemplated that Cafi was to do all the jacking and boring required of Magnolia under the principal contract. This included the work eventually done by Glen Frost.

The trial judge found this as a matter of fact. In a letter to Meyer and Associates, the project engineers, signed by Lewis Sel-ig, president of Magnolia, Selig states: “If you approve [Vernon Causey as subcontractor] we'intend to employ Vernon for all road boring on the projects.” (Emphasis supplied.) Mr. Selig also testified at trial that his intention, in entering into the contract with Mr. Causey, was to agree that Causey would do all the work involving road boring on the project.

Magnolia correctly points out in its brief that the letter to Meyer & Associates is not a part of the contract between Magnolia and Cafi and that the subcontract does not state that Cafi is to be the sole subcontractor for jacking and boring. Also, Mr. Selig’s testimony of his intention to hire Cafi for all the work does not mean that there was a meeting of the minds on this point. However, plaintiff’s petition states that because Cafi did not complete the work it was to perform it had to hire Glen Frost as subcontractor. This indicates to us that the parties to the contract intended that Cafi was to complete all the jacking and boring done by Glen Frost.

THE CONTRACT WAS NOT MUTUALLY TERMINATED

We find that there was no mutual termination of the contract. Under the terms of the contract, a three-day written notice was required to be sent by Magnolia to Cafi to return to the job, since Cafi left the job with Magnolia’s permission. No such written notice was given. Although Magnolia contends that it attempted to contact Cafi through its president, Vernon Causey, the trial judge found, and we concur, that Magnolia could have contacted Mr. Causey had it truly wished to.

Mr. Willie Carbo, Magnolia’s job superintendent on the DeRidder project, testified that he knew where Cafi was working on a different job, and that he made no attempt to contact Mr. Andrew Fisk, a co-owner of Cafi who actually worked on the DeRidder job. Mr. Carbo did say he left phone messages for Mr. Causey to call him back. In fact, Mr. Carbo actually contacted Mr. Cau-sey and obtained permission to use a water truck which was left by Mr. Causey in DeRidder along with other equipment in anticipation of completing the work. However, it is clear that the terms of the contract, requiring written notice by Magnolia to Cafi, were not complied with. There was no justification for the lack of written notice. Mr. Frost was hired in January or February long before the lines were tested for leaks and before the defective work was discovered.

No matter how unwilling Magnolia was to have Cafi return, it is clear that Mr. Causey did not acquiesce in Magnolia’s decision to proceed without Cafi. There is no evidence which would allow that assumption. Vernon Causey testified that he was ready and willing to complete the work.

It cannot be implied that Cafi did not wish to continue its contractual relationship with Magnolia because Cafi did not demand to complete the work. Cafi had no duty under the contract to make such a demand and we believe that, considering the contractor-subcontractor relationship in which the contractor directs the work of the subcontractor, supplies the materials, and can direct work stops and stoppages, Cafi cannot be denied recovery because it did not subsequently press the issue with Magnolia.

By the time Mr. Causey and Cafi learned of the breach it would have been useless for Cafi to protest or demand that it be allowed to finish, since Glen Frost and already been hired and had commenced work. Mr. Cau-sey testified that when he learned of Frost’s hiring, Frost had almost completed the work.

The trial judge, in finding that Cafi abandoned the subcontract, points to no objective evidence of abandonment and we believe the finding is unsupportable. Under the terms of the subcontract, Cafi was entitled to three days written notice to return to complete the work, but Magnolia failed to give such written notice. Instead, Magnolia hired another subcontractor to complete the work Cafi was hired to do. This was a breach of the subcontract as contemplated by the parties, and upon proper proof, Cafi is entitled to damages reasonably contemplated by the parties.

CAFI SUFFICIENTLY PROVED ITS DAMAGES

Cafi adduced sufficient proof of its damages to allow us to fix an award in its favor. This proof consists of the testimony of Cafi’s president, Vernon Causey, the per foot price stated in “Schedule A” of the subcontract, and the amount of work that is definitely established as done by Glen Frost.

Louisiana Civil Code article 1934 states: “Where the object of the contract is any thing but the payment of money, the damages due to the creditor for its breach are the amount of the loss he has sustained, and the profit of which he has been deprived ...”

In White v. Rimmer & Garrett, Inc., 340 So.2d 283 (La.1976), the Supreme Court ruled that the damages due a subcontractor for being deprived of his right to perform the contract consist of the profits of which the subcontractor was deprived. The lost profit is to be determined by deducting from the total contract price the costs of labor and material which would have been incurred, rather than assessing loss profit proportionately based on the subcontractor’s net income experience on the job.

Magnolia contends that Cafi failed to prove any of its damages and that the uncorroborated testimony of one who seeks the damages testified to is not sufficient proof to allow the award. It is noted that Mr. Causey’s testimony was not controverted by cross-examination, nor did Magnolia present its own witnesses as to its potential liability. Mr. Causey’s testimony can be summed up as follows:

Gross Profit $25,975
(3462 feet of boring done by Glen Frost according to Magnolia’s petition)
Expenses 6,750
($400 per day wages and taxes for 4 workers plus $50 per day fuel and rent for boring machines, or a total of $450 per day, times 15 days of work)
Net Profit $19,200

In Jordan v. Travelers Insurance Co., 257 La. 995, 245 So.2d 151 (1971), the Louisiana Supreme Court held: “... loss of earnings need not be proved with mathematical certainty, but only by such proof as reasonably establishes the claim.”

We do not rely- solely on Mr. Causey’s testimony to establish his gross profit. The Magnolia-Cafi contract established the per foot contract price of $7.50 and Glen Frost actually bored 3462 feet. Mr. Causey’s un-contradicted testimony as to the expenses he would have incurred establishes with reasonable certainty his net profit.

Cafi has proved by a preponderance of the evidence the lost profit sustained when Magnolia failed to notify Cafi to return to the job and hired Glen Frost to complete Cafi’s part of the project. The subcontract provides the rate at which Cafi was to be paid. The number of feet Cafi would have bored was concretely established by Magnolia’s petition, the testimony, and the findings of the trial court. Mr. Causey’s testimony established on the job expenses to a reasonable certainty, uncontradicted by Magnolia. Therefore, we award to plaintiff in reconvention, Vernon Causey and Cafi Company, Inc., the sum of $19,200.

Counsel for the plaintiff in recon-vention cites Alexander v. Burroughs Corp., 359 So.2d 607 (La.1978) and urges that interest on the judgment should run from the date of active breach of the contract. Alexander is a redhibition case. Although Justice Dixon cites Louisiana Civil Code Article 1932, which provides that damages are due from the moment of active violation, he also states that the Supreme Court has consistently said that all sums due on contracts bear interest from time of judicial demand. Sullivan v. Williams, 2 La.Ann. 876, 878 (1847). See also Petrie v. Wofford, 3 La. Ann. 562 (1848), Calhoun v. Louisiana Materials Co., Inc., 206 So.2d 147, 151-52 (La.App. 4th Cir.1968), writ denied, 251 La. 1050, 208 So.2d 324 (1968); Friede v. Myles Salt Co., 177 So. 105, 108 (La.App.1937). Interest therefore should run from the date of judicial demand.

II. THE MAIN DEMAND.

There are two issues to be resolved regarding the main demand regarding Magnolia damages for the costs of repairing Cafi’s defective work:

1. Did the trial court err in not allowing damages for equipment costs, office overhead, and on site overhead as not having been adequately proven?

2. Did the trial court err in awarding to Magnolia only 50% of the proven costs of repairing defective work?

EVIDENCE OF OVERHEAD COSTS IS INSUFFICIENT

The trial judge decided the evidence of overhead costs and equipment costs was too vague and general to establish the claim, and we agree.

The office manager and bookkeeper, Mr. Tommy Nezat, offered the only evidence of the costs of repair. As to the equipment costs, he said he believed an hourly rate based on a “blue book” figure was charged for the use of the equipment, but his testimony was no more specific or detailed than that.

Mr. Nezat also testified as to overhead expenses, both office and on site. As to office overhead, he said that a figure of “15 or 16%” was applied to the other costs involved to get an amount. The percentage figure was determined by dividing total job expenditures into general administrative expenses for the year. As to on site overhead, Mr. Nezat said the 10% figure was used as a “rough estimate” of actual overhead costs.

By their nature, overhead costs are difficult to prove and do not lend themselves to precise allocation to specific jobs performed. Overhead has been disallowed as insufficiently proved in other cases. See La. Power & Light Company v. Smith, 343 So.2d 367 (La.App. 4th Cir.1977), and Illinois Central Railroad Co. v. Cullen, 235 So.2d 154 (La.App. 4th Cir.1970). Therefore, we cannot say the trial court was clearly wrong in refusing such an award in this case.

FIFTY PERCENT ALLOCATION CORRECT

The damages the trial court did award for labor, payroll taxes and insurance, and materials, were reduced by the trial court by 50%. The trial court held that the evidence would not support a finding that more than 50% of the defective work was due solely to Cafi’s poor work-menship. We cannot say this allocation of damages is clearly wrong.

The testimony was overwhelming that Magnolia allowed Cafi to install saddles and make tie-ins to (connections with) sewer lines without using primer before the pipes were glued together. The testimony was also overwhelming that gluing the pipes without the primer was improper and allowed the pipes to become pulled apart, necessitating some of the repair costs complained of. Furthermore, the testimony indicates that Magnolia employees themselves gued pipe without first using primer.

Other damages to pipes appear to result from heavy blows, probably from a carelessly operated backhoe. Both Magnolia and Cafi used backhoes in their operations, Cafi in back filling trenches and Magnolia in trying to locate leaking joints.

Although the daily reports of the repair crews show the amount of work done in repairing, they do not adequately show which party was responsible for the damage. Some of the reports, signed by Magnolia foreman George Duprey, state that Bill Festerban, a former employee of Magnolia’s, was responsible for some of the defective installations. As stated before, Cafi made some connections without primer with the permission of Magnolia and some of the faulty connections must be the fault of Magnolia. In view of the evidence presented, we cannot say the trial court was clearly wrong in its findings and judgment on the main demand. Therefore, we affirm the part of the judgment awarding damages to Magnolia.

DECREE

For the foregoing reasons, that part of the trial court’s judgment awarding damages to Magnolia Construction Company, Inc., and against Cafi Company, Inc., is affirmed.

The part of the judgment rejecting the reconventional demand of Vernon Causey and Cafi Company, Inc., is reversed and it is ordered, adjudged and decreed that there be judgment in favor of Cafi Company, Inc., and Vernon Causey and against Magnolia Construction Company, Inc., in the sum of $19,200 with legal interest from the date of judicial demand.

It is further ordered, adjudged, and decreed that all costs of these proceedings, both in the trial court and in this appeal, be assessed equally to the parties.

AFFIRMED IN PART, REVERSED IN PART AND RENDERED.


author: DOMENGEAUX, Judge.

text:
    Jerome C. BENSON, Plaintiff-Appellant, v. Howard Warren SEAGRAVES, et al., Defendants-Appellees.
    No. 82-163.
    Court of Appeal of Louisiana, Third Circuit.
    Oct. 13, 1982.
    Rehearing Denied Dec. 2, 1982.

      Breazeale, Sachse & Wilson, John B. No-land, Baton Rouge, for plaintiff-appellant.
    Jones, Jones & Alexander, J.B. Jones, Jr., Cameron, for defendants-appellees.
    Before DOMENGEAUX, CUTRER and DOUCET, JJ.
   DOMENGEAUX, Judge.

This tort case, tried before a jury, was filed by Jerome C. Benson for injuries he received on January 4, 1979, while riding as a guest passenger in a truck being driven by one of the defendants, Howard Warren Seagraves. Other defendants named in the action included Jefferson Davis Electrical Cooperative (hereafter referred to as Jeff Davis), who was Seagraves’ employer, and United States Fidelity & Guaranty Company, Jeff Davis’ liability insurer. The defendants subsequently brought a third party action against the Department of Transportation and Development of the State of Louisiana, as well as against its liability insurer, Travelers Insurance Company. Also intervening in the action was Commercial Union Insurance Company, the worker’s compensation insurer for Barbay Engineers, plaintiff’s employer, for recovery of the payments made to plaintiff Benson under its policy with Barbay.

The jury returned a special verdict in favor of Jerome Benson, finding that he had suffered damages in the amount of $125,000.00. The court pursuant to the verdict, thereafter rendered judgment against all the defendants insólido, and in favor of Benson in the amount of $82,450.72, with legal interest, as well as in favor of Commercial Union Insurance Company in the amount of $42,459.21 with legal interest thereon. Commercial Union was also relieved of the obligation of paying weekly compensation benefits and any further claims for medical expenses to Benson.

Plaintiff Benson has appealed the jury award, claiming that it is inadequate and an abuse of the jury’s discretion in light of the magnitude of the injuries suffered by him. Defendants have answered the appeal, alleging that plaintiff should be denied damages in tort and that his sole avenue of recovery should be in worker’s compensation, on the theory that Jeff Davis was the statutory employer of Benson.

Our review of the record leads us to conclude that the jury was in error in holding that Jeff Davis was not the statutory employer of Jerome C. Benson. Therefore, we reverse.

At the time of the accident, Jerome C. Benson was employed as an electrical engineer at Barbay Engineers, with whom he had been employed since 1973. Barbay Engineers is involved in the planning and design of electrical facilities, and was often hired by Jeff Davis to perform professional engineering services. Benson was specifically involved in the design of electrical substations for clients of Barbay.

Jeff Davis is one of thirteen rural electric cooperatives in the state of Louisiana. Its charter provides that it is organized pursuant to the provisions of La.R.S. 12:401, et seq. La.R.S. 12:401, in particular, authorizes the organization of such cooperatives “... for the purpose of supplying electrical energy and promoting and extending the use thereof.” . La.R.S. 12:403 specifically delineates the powers that such electrical Co-ops have, including the power to:

“(4) Generate, manufacture, purchase, acquire, accumulate and transmit electric energy, and distribute, sell, supply, and dispose of electric energy to its members, to governmental agencies and political subdivisions, and to other persons not in excess of ten per centum of the number of its members;”
* * * * * *
“(8) Construct, purchase, take, receive, lease as lessee, or otherwise acquire, and own, hold, use, equip, maintain, and operate, and sell, assign, transfer, convey, exchange, lease or lessor, mortgage, pledge, or otherwise dispose of or encumber, electric transmission and distribution lines or systems, electric generating plants, electric refrigeration plants, lands, buildings, structures, dams, plants and equipment, and any and all kinds of classes of real or personal property whatsoever, which shall be deemed necessary, convenient or appropriate to accomplish the purpose for which the cooperative is organized;”

In order for Jeff Davis to carry out these powers, it must often call on Barbay Engineers to perform engineering work that is either too complex or too time-consuming for Jeff Davis engineers to handle. Therefore, pursuant to a contract dated August 1, 1977, between Barbay and Jeff Davis, Bar-bay agreed to perform such engineering services for Jeff Davis.

One of Jeff Davis’ customers, Seacoast Products, Inc., of Cameron, Louisiana, sought to make changes at their plant which would have required modification of their existing electrical facilities. Thus, on October 31, 1978, Benson went to Cameron with Mr. Howard Seagraves and Mr. Jim DeCordova of Jeff Davis in order to survey the situation at Seacoast and develop recommendations. In a letter dated November 30, 1978, Benson advised Jeff Davis that it would be necessary to design and construct a new service substation adjacent to the existing facility at Seacoast. Subsequently, Benson prepared a design for the new facility and sent the layout to Jeff Davis.

However, Jeff Davis stipulated that Seacoast was to bear the cost of the new construction, and thereafter Seacoast indicated that they might not need to build an entirely new substation. Jeff Davis sought to make another determination of the modifications that would be necessary at Seacoast, so on January 4, 1979, it sent Seagraves from Baton Rouge to meet Jerome Benson in Jennings, Louisiana, so that they could travel together to Cameron to inspect the facility once again.

Benson and Seagraves rode to Cameron in a Jeff Davis truck. When they reached Seacoast they could find no one present at the plant with authority to discuss the modifications. Thus, the trip was essentially a wasted effort, and the two men left shortly thereafter.

On the return trip, the Jeff Davis truck suddenly crashed into the rear of a large flatbed trailer/truck. Seagraves was driving the truck at the time of the accident, and Benson was a passenger. Seagraves’ negligence was stipulated by both sides in the trial court, thus removing the cause of the accident from being an issue at the trial.

Benson suffered severe injuries in the accident, including the loss of an eye, facial disfigurement, a broken ankle, and other related problems. During the period of time between the accident on January 4, 1979, and the time Benson returned to work in April of 1979, Benson allegedly lost $5,000.00 in wages and incurred approximately $19,407.00 worth of medical expenses. Benson testified that all of his medical expenses had been paid by Commercial Union, the worker’s compensation insurance carrier for Barbay. He also testified that he had been receiving weekly worker’s compensation checks from Commercial Union ever since the accident. Furthermore, at the time of the trial, Benson was earning $31,500.00 a year with Barbay Engineers, representing an increase in salary since returning to his former job following his recuperation period.

Three issues were raised for our consideration on appeal. The first concerns whether or not Jeff Davis was the statutory employer of Jerome Benson, such that Benson was limited to recovery solely in worker’s compensation rather than in tort. The second involves whether the jury award of $125,000.00 to Jerome Benson constituted an abuse of discretion. The final issue deals with whether or not Jerome Benson’s alleged failure to wear a seat belt at the time of the accident constituted contributory negligence on his part.

Because we have determined that Jeff Davis was indeed the statutory employer of Jerome Benson, and that Benson was thereby limited to recovery in worker’s compensation rather than in tort, we find it unnecessary to consider the other issues. La.R.S. 23:1061 provides the criteria for determining whether or not a principal is a statutory employer:

“Where any person (in this section referred to as principal) undertakes to execute any work, which is a part of his trade, business, or occupation or which he had contracted to perform, and contracts with any person (in this section referred to as contractor) for the execution by or under the contractor of the whole or any part of the work undertaken by the principal, the principal shall be liable to pay to any employee employed in the execution of the work or to his dependent, any compensation under this Chapter which he would have been liable to pay if the employee had been immediately employed by him;”

If Jeff Davis is found to be a principal within the purview of this section, then the provisions of La.R.S. 23:1032 would be applicable:

“The rights and remedies herein granted to an employee or his dependent on account of an injury, or compensable sickness or disease for which he is entitled to compensation under this Chapter, shall be exclusive of all other rights and remedies of such employee, his personal representatives, dependents, or relations, against his employer, or any principal or any officer, director, stockholder, partner or employee of such employer or principal, for said injury, or compensable sickness or disease. For purposes of this Section, the word ‘principal’ shall be defined as any person who undertakes to execute any work which is a part of his trade, business or occupation in which he was engaged at the time of the injury, or which he had contracted to perform and contracts with any person for the execution thereof.”

The defendants-appellees argue that Jeff Davis was the statutory employer of Jerome Benson because Jeff Davis was authorized by charter and statute to construct, maintain, and operate an electrical utility system. They specifically cite as authority Gray v. Louisiana Power and Light Company, 247 So.2d 137 (La.App. 4th Cir.1971), writ denied, 259 La. 59, 249 So.2d 202 (1971). In that case, the plaintiff was injured while his company was constructing foundations for towers to be used by Louisiana Power and Light Company to stretch electrical transmission lines across the Mississippi River. The court in this case stated:

“The LP & L Company is specifically authorized by its charter to use, manufacture and produce not only electricity but the means to transmit it to its users. The fact that it may not choose to exercise the right to build any or all of its own facilities in transmitting the electricity, as these towers and foundations, but rather contract with another will not exempt them from the provisions of LSA-R.S. 23:1061.”

The court ultimately held that the plaintiff’s sole remedy was in worker’s compensation rather than in tort. See also Messer v. Bagwell Coatings, Inc., 283 So.2d 279 (La.App. 1st Cir.1973).

This Circuit had an opportunity to comment on Gray in the case of Dupleehin v. Pittsburgh Plate Glass Company, 265 So.2d 787 (La.App. 3rd Cir.1972). In that case, the Court stated:

“We feel that while it may be inferred from the Gray case, supra, that an important factor in determining what the trade, business or occupation of a corporation is, is whether particular work is specifically authorized by the charter of the corporation, that case did not abolish the traditional requirement that the work being done should be a part of the regular trade, business or occupation of the corporation in order for LSA-R.S. 23:1061 to apply. In fact, the court in that case specifically found that the work being done was ‘an integral and a necessary part of the regular trade, business or occupation’ of the corporation which contracted for the work.”

The Dupleehin court also drew a distinction between ordinary maintenance and repairs of existing facilities and construction of a new facility or complete reconstruction of an existing facility, holding that only in the former case could the plaintiff be limited to recovery solely in compensation. They applied this test and determined that the plaintiff could recover in tort since the defendant was engaged in new construction.

However, we find that an application of the rule of Dupleehin warrants a different result when applied to the facts of this case. Initially, it should be noted that the facts in Dupleehin are distinguishable from the facts before us now. In Dupleehin the defendant was a plate glass company whose regular business operations could in no way be stretched or construed to include the construction of electrical generating facilities. However, in the case at hand, the design and construction of electrical substations by Jeff Davis was an essential and crucial part of their ordinary business of transmitting electricity. Because of this distinction, we find it inappropriate to apply the ordinary maintenance/new construction dichotomy to the facts presently under consideration.

In order to determine whether or not Benson’s activities were a part of “the regular trade, business, or occupation” of Jeff Davis, we find that the two tests cited in Moses v. Vulcan Materials Company, 388 So.2d 117 (La.App. 1st Cir.1980), writ denied, 392 So.2d 1058 (La.1980), determinative:

“(1) Whether the work which the employee is performing is part of the trade, business or occupation of the principal and is a necessary or an essential part of the principal’s business, and/or (2) whether the work was the type customarily done by the principal or other employers similarly situated.”

We have no difficulty in concluding that the work done by Benson was a necessary or essential part of Jeff Davis’ business. Jeff Davis is an electrical cooperative organized pursuant to statute specifically for the purpose of supplying electrical energy to the public. Without electrical substations, Jeff Davis could not transform high voltages of electricity into lower voltages capable of being used by consumers. Clearly, the design of said substations constitutes an essential and necessary part of Jeff Davis’ business.

Furthermore, we feel that the record supports a finding that not only Jeff Davis, but other similarily situated electrical cooperatives customarily engage in the design and construction of electrical substations. The most compelling evidence in support of this conclusion come from the plaintiff, Jerome Benson. He clearly stated under examination that Jeff Davis itself could have undertaken this design had it chosen to do so. Furthermore, he admitted that it was possible that Seagraves could have done the design work that Barbay was doing for Seacoast. Benson also admitted that some of the other rural electrical cooperatives in the State had engineering staffs that were capable of undertaking this design work.

Seagraves corroborated this testimony by stating that not only did he possess the ability to design substations similar to the one planned for Seacoast, but that he had actually designed similar substations for Jeff Davis in the past. It should be noted here that the record indicates that Sea-graves had no college diploma and lacked the specialized education and training that the engineers at Barbay possessed. On cross-examination, plaintiffs counsel attempted to discredit Seagraves’ testimony by forcing him to admit that he had received assistance from Barbay in the design work that he had done in the past. However, we do not feel that this detracts from the fact that Seagraves possessed the ability to design the Seacoast substation and that Sea-graves had done work on similar substations in the past, albeit with assistance from Bar-bay personnel. The second test cited in Moses is thus met.

Finally, Jeff Davis had clear authority to do this type of work. The charter of Jeff Davis was drafted pursuant to the provisions of La.R.S. 12:401, et seq., (supra). The design of an electrical substation is an integral part of the cooperative’s power to “... construct ... electric transmission and distribution lines or systems ... . ” (La.R.S. 12:403(8)).

Unfortunately, the jury in this case was not fully instructed as to the nature of the law concerning statutory employer status as developed in the Gray, Messer, and Duple-chin cases, which we find controlling. Had they been properly instructed we feel that any finding on their part that Jeff Davis was not the statutory employer of Jerome Benson would have been clearly erroneous.

It is therefore Ordered, Adjudged, and Decreed that the judgment of the trial court in favor of Jerome C. Benson against the named defendants be and the same is hereby reversed, and that there be judgment herein in favor of the defendants Jefferson Davis Electrical Cooperative, United States Fidelity & Guaranty Company, and Howard Warren Seagraves, ordering plaintiff’s petition against them dismissed.

All costs at trial and on appeal are assessed against plaintiff, Jerome C. Benson.

REVERSED IN PART AND RENDERED.

      . This action was later dismissed on a motion for summary judgment filed by the third party defendants.

      . No issue is made of the fact that the judgments together fall slightly short of the $125,-000.00 jury figure.

      . Seagraves testified that he designed similar substations for the Louisiana Menhaden Company at Cameron .and the Michigan Wisconsin Pipeline Company facilities at Grand Chenier.


author: BYRNES, Judge.

text:
    Sadie MERRITT v. NEW ORLEANS PUBLIC SERVICE, Fred Domino and Maryland Casualty Insurance Co.
    No. 13146.
    Court of Appeal of Louisiana, Fourth Circuit.
    Oct. 19, 1982.

      Bendana & Carlton, Orlando Bendana, New Orleans, for plaintiff-appellant.
    James Maher, III, Beard Blue, Schmitt, Mathes, Koch & Williams, Melvin W. Math-es, New Orleans, for defendant-appellee.
    Before BARRY, BYRNES and CIACCIO, JJ.
   BYRNES, Judge.

In this appeal Sadie Merritt, the appellant, contends that the trial judge erred in finding that Maryland Casualty Co., the appellee, acted reasonably and in good faith in negotiating the settlement of certain claims arising out of an accident between a New Orleans Public Service bus and a vehicle owned and operated by Freddie Domino and insured by Maryland Casualty. We affirm.

The facts of the case are as follows: On March 3,1980 an accident occurred between a New Orleans Public Service bus and a vehicle driven by Freddie Domino and insured by Maryland Casualty Co. Twenty-nine passengers in the bus, including the appellant, were injured. Subsequently Maryland Casualty perfected settlements with twenty-two of those passengers using approximately % of the $10,000.00 policy limits available. Although Ms. Merritt had notified Maryland Casualty of her claim by letter dated May 11,1980 no settlement was attempted as to her claim.

On August 7, 1980 Ms. Merritt filed suit. After a trial on the merits Freddie Domino was found responsible for the accident and judgment was entered against him for those injuries in excess of his insurance policy limits.

On appeal Ms. Merritt argues that the failure of Maryland Casualty to settle her claim after receiving notice of it’s existence constituted bad faith. We disagree. Based on the record before us we find that Maryland Casualty Co. acted reasonably and in good faith in it’s settlements in this matter. By their action the vast majority of claims were settled for nominal amounts, leaving $3,630.00 still available to those claimants with whom settlements were not perfected.

It is well settled in our law that an insurer may enter into reasonable, good faith, settlements even though such settlements exhaust or diminish the proceeds available to other claimants. In Manieri v. Horace Mann Mutual Ins. Co., 350 So.2d 1247 at 1248 (La.App. 4th Cir.1977) this court stated:

A liability insurer faced with multiple claims to inadequate proceeds is generally not required to prorate, but may enter into compromise agreements with one or several claimants to the exclusion of others, even to the extent of exhausting the entire fund, as long as the compromises are reasonable and are made in good faith.

See also Holtzdaw v. Falco, 355 So.2d 1279 (La.1978) Richard v. Southern Farm Bureau Casualty Insurance Co., 254 La. 429, 223 So.2d 858 (1969).

During the trial Ms. Jeanette Groetch, the claims adjustor who handled the case for Maryland Casualty, was questioned extensively concerning her reasons for handling the settlements as she did. When asked by Ms. Merritt’s attorney why she settled so many claims and did not attempt to settle Ms. Merritt’s claim she replied, “When I was presented with your medical I wanted to wait and see what I was going to have from the other plaintiff’s attorneys involved in the case, because I was afraid, you know, spending too much on one claim where I would be presented with more serious medical from another claimant.” When asked if that meant that she preferred to settle claims that did not involve serious injuries she replied, “No— well, I don’t have one involved from the onset. What we are faced with was a small policy and I would be willing to settle for minimal amounts if they would agree, and if not we would have to wait and see.”

We find that the testimony of Ms. Groetch, and the other evidence introduced at trial shows that Maryland Casualty acted both reasonably and in good faith in settling the claim in question.

Appellant has produced no evidence other that Maryland Casualty’s failure to settle with her to prove bad faith or unreasonableness. Accordingly we affirm the trial court’s decision.

Cost of this appeal are to be borne by appellant.

AFFIRMED.

      . The average settlement reached was $289.00.


author: YELVERTON, Judge.

text:
    William F. FOSTER, etc., Plaintiff-Appellee, v. William H. LAMBERT, Defendant-Appellant.
    No. 82-551.
    Court of Appeal of Louisiana, Third Circuit.
    Oct. 21, 1982.
    William H. Lambert, Lafayette, for defendant-appellant.
    McClain, Morgan & Savoy, R. Scott McClain, Lake Charles, for plaintiff-appel-lee.
    Before DOMENGEAUX, STOKER and YELVERTON, JJ.
   YELVERTON, Judge.

MOTION TO DISMISS

The plaintiff-appellee, William F. Foster, d/b/a Lake Charles Neurosurgical Associates, moves to dismiss the appeal of defendant-appellant, William H. Lambert, as not being timely perfected.

Default judgment was rendered against the appellant on 4 March 1982. Appellant timely made application for new trial and after argument thereon, the trial court took the matter under advisement. By minute entry dated 28 April 1982, the trial court denied defendant’s application for a new trial. The trial judge, by letter of 28 April 1982, sent both parties a copy of the minute entry. The motion for appeal was filed by defendant on 26 August 1982, a lapse of about 120 days.

Louisiana Code of Civil Procedure Article 2087 states:

“Except as otherwise provided in this Article or by other law, an appeal which does not suspend the effect or the execution of an appealable order or judgment may be taken within sixty days of:
(2) The court’s refusal to grant a timely application for a new trial, if the applicant is not entitled to notice of such refusal under Article 1914;”
Article 1914 provides:
When a case has been taken under advisement by the court for the purpose of deciding whether an interlocutory order or judgment should be rendered, the clerk shall make an entry in the minutes of the court of any such interlocutory order or judgment rendered thereafter.
If a written request for notice of the rendition of the interlocutory order or judgment in such a case has been filed, the clerk shall mail notice thereof to the party requesting it; and the latter shall have ten days from the date of the mailing of the notice to take any action or file any pleadings he deems necessary, except as provided in the next paragraph.
If the interlocutory order or judgment is one refusing to grant a new trial, the delay for appealing commences to run only from the date of the mailing of such notice, as provided in Articles 2087 and 2123.

The cases interpreting these articles have consistently held that where a party does not file a written request for notice of refusal to grant a new trial, then said party is not entitled to notice. Thus, the third paragraph of Article 1914 is not applicable, and the delays for appealing commence to run from and after the rendition of judgment refusing to grant a new trial. C.C.P. Art. 2087(2) and Art. 2123(2). See McDowell Well Service, Inc. v. Gray and Company, 270 So.2d 647 (La.App. 3rd Cir.1972); Cox v. Southern Colonial Inv. Inc., 393 So.2d 146 (La.App. 1st Cir.1980).

The record shows that the appellant did not request notice of rendition of the interlocutory judgment denying the new trial pursuant to LSA C.C.P. Article 1914, however appellant did receive actual notice of the denial by letter on 28 April 1982. Thus, since notice was not required, the period for taking the appeal began to run after the denial of the new trial on 28 April 1982. Since more than sixty days had elapsed before the defendant filed a motion for appeal, the motion to dismiss must be granted.

MOTION GRANTED.


author: CULPEPPER, Judge.

text:
    Sunset CAREY and Stanley Cormier, Plaintiffs-Second Appellants-Appellees, v. Dennis ORY, et al., Defendants-First Appellants.
    No. 82-134.
    Court of Appeal of Louisiana, Third Circuit.
    Oct. 21, 1982.
    Rehearing Denied Dec. 6, 1982.
    Writ Denied Feb. 4,1983.

      Levingston, Tynes & Liles, Maurice Tynes, Lake Charles, for defendant-appellant-appellee.
    McHale, Bufkin and Dees, Louis D. Buf-kin, Lake Charles, for plaintiffs-appellees.
    L. Daniel Bishop, Jr., DeQuiney, for defendant-appellee.
    Raggio, Cappel, Chozen & Berniard, G. Michael Bourgeois, Lake Charles, for defendant-appellee.
    Before CULPEPPER, GUIDRY and LA-BORDE, JJ.
   CULPEPPER, Judge.

This is a tort action for damages. The plaintiffs, Sunset Carey and Stanley Cormier, were pedestrians struck by an automobile owned by Mr. and Mrs. Leroy Miller and operated by Dennis Ory. The plaintiffs sued Allstate Insurance Company as the liability insurer of the vehicle operated by Ory and Aetna Casualty & Surety Company as the underinsured motorist carrier. Allstate denied coverage on the grounds that Ory was not an omnibus insured within the meaning of the policy language.

There was a trial by jury, and at the close of the evidence, the trial judge directed a verdict in favor of the plaintiffs and against Allstate Insurance Company on the issue of coverage. The jury returned a verdict attributing 90% of the total combined negligence to the defendant, Dennis Ory, and 10% of the total combined fault to each of the plaintiffs. The trial court subsequently rendered judgment in accordance with the verdict of the jury.

Allstate appeals from the directed verdict on coverage and the resulting jury verdict; citing as error the trial court’s exclusion from the jury of all evidence dealing with the question of whether Mr. Ory deviated from the scope of permission granted by the insured. This evidence was taken on an Offer of Proof. The plaintiffs also appealed, contending the jury erred in attributing to each plaintiff 10% comparative negligence, and also that the jury awarded inadequate damages to both plaintiffs.

The following issues have been raised on this appeal: (1) Did the trial court err in granting a directed verdict against Allstate on the issue of whether Ory was an omnibus insured under the Allstate policy? (2) Was it error to exclude all evidence with regard to the deviation from the scope of permission of the car’s owner by the driver, Mr. Ory? (3) Was the jury clearly wrong in finding that the negligence which was the proximate cause of the accident was attributable 10% to each of the plaintiffs? (4) Did the jury abuse its discretion by making inadequate awards of damages?

FACTS

At about 9:00 or 9:30 a.m. on the morning of September 16, 1980, Dennis Ory approached Mr. and Mrs. Leroy Miller and requested the use of their 1973 Oldsmobile to visit his doctor in Orange, Texas. The Millers and Mr. Ory all resided in Vinton, Louisiana. Mr. and Mrs. Miller granted Ory permission to use the car, as they had done on previous occasions.

Sometime between 7:00 and 7:30 p.m. on the same day, the plaintiffs, in preparation for going shrimping, had stopped at a grocery store on Louisiana Highway 27 south of Sulphur, Louisiana. They were traveling in Mr. Carey’s vehicle and pulling Mr. Cor-mier’s boat on a trailer. As they prepared to pull onto the road, the wheel fell off the boat trailer, and they pulled the vehicle onto the west shoulder of the road for repairs, coming to rest about six feet from the traveled portion of the highway. Both plaintiffs were standing beside the boat and trailer, repairing the trailer, when defendant Ory, traveling south on the roadway in the Miller ear, ran into the rear of the trailer. This caused the trailer to strike both plaintiffs, resulting in their bodily injuries.

In force at the time of the accident was an automobile liability policy on the Miller automobile, issued by the defendant Allstate, containing the standard “Omnibus Insured” clause and naming Leroy Miller as the named insured. The policy limits are $50,000/$100,000. Also in force was a liability policy on Mr. Carey’s vehicle issued by Aetna, providing uninsured motorist coverage up to the amount of $10,000.

Allstate contended at trial that Mr. Ory was not an omnibus insured within the meaning of its policy language, because he had deviated from the scope of permission granted by the named insured. It sought to introduce evidence to show that Mrs. Miller had told Mr. Ory he could use the car to go to the doctor in Orange, but had told him to have the car back to her by noon. They argued that he was clearly outside the scope of the original permission at the time of the accident, being 15 miles east of Vinton, instead of to the west in the direction of Orange, and seven hours overdue.

The trial court excluded all evidence with regard to the scope of permission granted to Mr. Ory, and his deviation from it, and at the close of the evidence, rendered a directed verdict against Allstate, holding that Dennis Ory was an omnibus insured under the liability policy on the Miller’s Oldsmobile.

The jury found that plaintiff Carey sustained damages in the amount of $47,000 and plaintiff Cormier in the amount of $2,800. The trial court, in its judgment, made the appropriate reduction in these amounts based on the percentage of fault attributable to the plaintiffs, and awarded $2,520 to plaintiff Cormier and $42,300 to plaintiff Carey.

DIRECTED VERDICT ON COVERAGE

Allstate contends the language of its omnibus clause excludes coverage under the circumstances of this case. It sought to introduce testimony of Mrs. Miller to show that she had informed Ory to have the car back to her by about noon on the day of the accident. This evidence was excluded by the trial court. Allstate maintains that the evidence should have been admitted for the purpose of proving that Mr. Ory’s use of the vehicle was not within the scope of the permission of the named insured.

The general rule with regard to omnibus coverage was first stated by the Louisiana Supreme Court in Parks v. Hall, 189 La. 849,181 So. 191 (La.1938). The Parks’ court held that the initial permission of the named insured to another to use the car in the first instance, regardless of whether the driver was proceeding within the limitations of the permission of the insured, was all that was necessary to bring the driver within the coverage of the omnibus clause. A definite rule to guide all courts was thereby established, eliminating the need to consider deviations from the contemplated use of the vehicle. See Waits v. Indemnity-Insurance Company of N.A., 215 La. 349, 40 So.2d 746 (1949).

This rule has been consistently followed by Louisiana courts. For example, in Gathe v. Aetna Casualty & Surety Company, 345 So.2d 117 (La.App. 1st Cir.1977), writ refused 346 So.2d 709 (La.1977), a student'who was authorized to drive a car from a repair shop to a body shop and to do road testing was held to be an omnibus insured under the policy on the vehicle, when he had an accident while on a personal mission. In Fuselier v. Aetna Insurance Company, 219 So.2d 232 (La.App. 3rd Cir.1969), a minor who reasonably believed he had initial permission to drive his sister’s car to his mother’s house to pick up phonograph records, was held to be an omnibus insured, despite the fact that he was outside the scope of his errand when he became involved in an accident. See also McConnell v. Travelers Indemnity Company, 248 La. 509, 180 So.2d 406 (La.1965); Boudreaux v. State Farm Mutual Automobile Insurance Company, 385 So.2d 480 (La.App. 1st Cir.1980), writ denied 392 So.2d 690, 691 (La.1980); Ritter v. Thornton, 309 So.2d 750 (La.App. 4th Cir.1975); and Rawls v. J&MPoultry, Inc., 273 So.2d 340 (La.App. 1st Cir.1972), writ refused 274 So.2d 708 (La.1973).

Allstate relies heavily on the case of Re-volta v. Allstate Insurance Company, 273 So.2d 645 (La.App. 4th Cir.1973), in which coverage was denied. In that case a minor, who caused an accident while on a personal errand, was authorized to operate a car only within the wash bay in which its owner had placed it and only to the extent necessary to wash and clean it. The holding was that he was not driving with the permission of the named insured when he embarked upon his personal mission.

The instant case is distinguishable from Revolta inasmuch as the permittee here had initial permission to use the automobile on the public streets and highways on a personal mission. See also Cousin v. Page, 372 So.2d 1231 (La.1979), at page 1236; Hughes v. Southeastern Fidelity Insurance Company, 340 So.2d 293 (La.1976).

In light of the Louisiana rule on omnibus coverage, we find that the exclusion of Mrs. Miller’s testimony with regard to Mr. Ory’s deviation from the permission granted was proper because it was irrelevant, considering the fact that Ory had the Millers’ initial permission to drive the car.

With regard to the question of whether or not the trial court erred in granting a directed verdict in favor of the plaintiff on the issue of omnibus coverage, it was held by this court in Campbell v. Mouton, 373 So.2d 237 (La.App. 3rd Cir.1979), that the following is the correct standard to be applied on a motion for a directed verdict:

“On motions for directed verdict and for judgment notwithstanding the verdict the Court should consider all of the evidence — not just that evidence which supports the non-mover’s case — but in the light and with all reasonable inferences most favorable to the party opposed to the motion. If the facts and inferences point so strongly and overwhelmingly in favor of one party that the Court believes that reasonable men could not arrive at a contrary verdict, granting of the motions is proper. On the other hand, if there is substantial evidence opposed to the motions, that is, evidence of such quality and weight that reasonable and fair-minded men in the exercise of impartial judgment might reach different conclusions, the motions should be denied, and the case submitted to the jury.” Boeing Company v. Shipman, 411 F.2d 365 (5th Cir.1969).

The record shows conclusively that Dennis Ory had the permission of Leroy Miller, as the named insured, to use the Millers’ car on the day of the accident. In view of this evidence and the foregoing authority, the directed verdict holding that the defendant Ory was an omnibus insured is proper.

Allstate argues persuasively that the opinion in Parks v. Hall, supra, was concerned only with the requirement that the non-owned automobile be driven “with the permission” of the named insured and did not consider the “scope of permission.” However, the Parks court made a broad statement that only initial permission is required, and later eases in the Courts of Appeal which did involve policies requiring both permission and scope cited Parks as authority for holding that if there was permission, scope was irrelevant. Allstate argues these later cases erroneously extended Parks. However, there are now so many cases, in some of which the Supreme Court denied writs, that the rule appears to be established. Either legislation or a decision of our Supreme Court will be required to change this rule.

COMPARATIVE NEGLIGENCE

The plaintiffs contend the jury committed manifest error in finding that the negligence giving rise to the accident was attributable 10% each to Carey and Cormier.

Even assuming the plaintiffs were negligent, their conduct does not reduce the amount of recovery unless it was a cause-in-fact of the accident. If the collision would have occurred irrespective of the plaintiffs’ negligence, then it was not a cause-in-fact of the injury. See Breithaupt v. Sellers, 390 So.2d 870 (La.1980); Dixie Drive It Yourself System New Orleans Company v. American Beverage Company, 242 La. 471, 137 So.2d 298 (La.1962).

The plaintiffs testified that their car was parked almost six feet from the white line on the edge of the road. Dusk was beginning to fall at the time of the accident, but it was not yet dark. The plaintiffs admitted that they did not display any devices warning of their disabled vehicle, as required by LSA-R.S. 32:368.

The only evidence in the record with regard to the reason Mr. Ory ran off the road was the testimony of Mr. Gilbert, a passenger in the Ory vehicle, who testified that Mr. Ory dropped his cigarette lighter and was reaching for it when he drove onto the shoulder.

We conclude the defendants have not borne their burden of showing that Carey’s failure to exhibit flares or warning lights was a cause-in-fact of the accident. Ory’s driving onto the shoulder and his failure to see the plaintiffs on the shoulder was in no way caused by the lack of warning devices.

We conclude that the jury’s determination that the legal cause of the accident was attributable 10% to each plaintiff is clearly wrong. We therefore reverse this finding and attribute 100% of the fault to the defendant Ory.

DAMAGES

Finally, the plaintiffs contend the jury erred in awarding inadequate damages. We disagree and affirm the awards.

In the assessment of damages in cases of quasi offenses, much discretion is left to the judge or jury. Before a court of appeal can disturb an award made by the trial court, the record must clearly reveal that the trier of fact abused its discretion in making the award. Furthermore, before an appellate court can disturb a factual finding by the trial court, it must be determined that the finding is manifestly erroneous and has no reasonable factual basis. See LSA-C.C. article 1934(3); Perniciaro v. Brinch, 384 So.2d 392 (La.1980) and cases cited therein.

In plaintiff Carey’s case, the evidence introduced to prove the income lost as a result of being unable to pursue his shrimping was tenuous at best. Furthermore,' there was conflicting expert medical testimony with regard to Mr. Carey’s disability as a result of the injury to his back. All the doctors examining Mr. Carey, except one, testified that they could find no objective symptoms of the continuing injury. We conclude the jury’s award to Mr. Carey does not constitute an abuse of discretion.

We further find that the award of $2,800 total damages to Mr. Cormier is adequate compensation for the loss of his boat and trailer, his medical expenses, his wrecker bill, lost wages and the injury to his thumb. Therefore, the damages awarded by the trial court will be upheld.

For the reasons assigned, the judgment appealed is amended to assess 100% of the damages suffered by each plaintiff against the defendant-appellant, Allstate Insurance Company. In all other aspects, the judgment is affirmed. All costs of this appeal are assessed against the defendant-appellant, Allstate Insurance Company.

AFFIRMED, AS AMENDED.

      .The liability provision of the policy reads as follows:
      “The following persons are insured under this Section.
      1. The named insured with respect to the owned or a non-owned automobile, provided the use of such non-owned automobile is with the permission, or reasonably believed to be with the permission, of the owner and is within the scope of such permission;
      2. Any resident of the named insured’s household with respect to the owned automobile;
      3. Any other person with respect to the owned automobile, provided the use thereof is with the permission of the named insured and within the scope of such permission;
      4. Any relative with respect to a non-owned private passenger automobile or trailer not regularly furnished for use of such relative, provided the use by such relative is with the permission, or reasonably believed to be with the permission, of the owner and is within the scope of such permission.”


text:
    Mrs. Ola Mae RUSSELL v. ORKIN EXTERMINATING CO., INC. et al.
    No. 53711.
    Supreme Court of Mississippi.
    Sept. 22, 1982.
    Rehearing Denied Dec. 1, 1982.
    Laurel G. Weir, Thomas L. Booker, Philadelphia, for appellant.
    Brunini, Grantham, Grower & Hewes, R. Wilson Montjoy, II, Frank E. Everett, Jr., Jackson, for appellees.
   Appeal from Circuit Court, Lauderdale County; Lester F. Williamson, Judge.

Before SUGG, P.J., and BROOM and BOWLING, JJ.

AFFIRMED.