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    AMERICAN FIDELITY FIRE INSURANCE COMPANY, Plaintiff-Appellee, v. PAVIA-BYRNE ENGINEERING CORPORATION, et al., Defendants-Appellants.
    No. 14403.
    Court of Appeal of Louisiana, Second Circuit.
    Jan. 13, 1981.

      Dawkins & Coyle by Michael S. Coyle, Ruston, for plaintiff-appellee.
    Many, LoCoco & Dwyer by M. Hepburn Many, New Orleans, for defendants-appellants.
    Hale M. Walker, Ruston, for City of Ru-ston.
    Before PRICE, MARVIN and JASPER E. JONES, JJ.
   JASPER E. JONES, Judge.

Defendants, Pavia-Byrne Engineering Corporation, and its President and Chief Engineer, Edgar H. Pavia, appeal a judgment against them in favor of plaintiff, American Fidelity Fire Insurance, for a sum equal to llh% of a contract price of a sewer line installation job performed by a now insolvent contractor for the City of Ruston. Plaintiff answers the appeal contending it was also entitled to a judgment for the same amount against the City of Ruston which was also a defendant in the suit. Ruston had entered into a contract with the D. T. Atkison Company to install approximately 16,000 feet of sewer line in the City of Ruston. The contract was a unit price contract, as opposed to a sum certain contract. Under these circumstances, the contractor does not bid a fixed price to do the entire job, but rather bids a price per unit for the units as estimated by the engineer in the proposal, and gets paid only for as many units as he performs, installs or furnishes. The bid was based on different prices listed in the contract for dissimilar units included within the sewer system to be installed. By way of example, the contractor received more for installation of pipe in areas where the ditch in which the pipe to be laid had to be bored under a street or driveway than he received for installation of pipe in areas where he could simply cut an open ditch. The contractor further received more for installing pipe pressure rated 100 PSI than for installing pipe pressure rated at 47 PSI. The final contract price was not to be determined until the entire project was completed.

Plaintiff executed the contract as surety for the contractor. The sewer system installed under the contract was designed by appellants, Pavia-Byrne Engineering Corporation and Edgar H. Pavia, its President. These appellants were not parties to nor signatories on the construction contract. The evidence establishes that there was a contract between Pavia-Byrne Engineering Corporation and the City of Ruston, by the terms of which it undertook to inspect the work performed by the contractor and to approve the contractor’s monthly estimate of work performed. This estimate formed the basis upon which the contractor was entitled, under the terms of the contract, to be paid on the 15th day of each month for the value of the work performed by it in the previous month, less the retainage provided for in the contract.

The contract contained two provisions which described the amount of retainage which Ruston was entitled to withhold from the value of the work performed by the contractor each month. One provision provided that Ruston would retain ten percent (10%) upon the value of the first fifty (50%) percent of the work performed by the contractor and five (5%) percent on the value of the remaining fifty (50%) percent to be performed by the contractor, for a total retainage of 7%%. The other provision stated that after 10% was retained from the first 50% that the subsequent retainage would be reduced in a manner that only 5% would be retained of the total value of the work performed, thereby resulting in Ru-sten having in retainage at the conclusion of the job 5% of the value of the total work performed.

Appellants provided a full-time inspector on the job who received from the contractor each month his statement of the work performed. This inspector, who was not an engineer, approved the contractor’s estimate of the value of the work performed and forwarded the work estimate to Edgar Pavia at his office in New Orleans. Pavia prepared a certificate approving payment to the contractor based upon the estimate of value received from his local inspector. These certificates provided for retainage of 10% on the first 50% of the work and for retainage reducing to 5% on the total work completed after the first 50% had been completed. The certificates approving payment were then signed by a representative of the Rusten Health and Sanitation Department and submitted to Ruston’s treasury office for payment. The part of the certificate signed by the Rusten representative contained the estimate of value and the retain-age percentage. Rusten made the payment based upon the engineer’s approval certificate retaining from the contractor’s payment the amount of retainage reflected upon the certificate. After the job was completed a final inspection of the various units included within it was made. When the value of the units of the job was determined in the amount set out for the respective types of work and were totalled, the value of all the work performed was the sum of $233,182.80. If the engineer’s certificates on the value of the work performed, upon which Rusten relied, had been correct, the City should have retained funds belonging to the contractor in the amount of 5% X $233,182.80, or $11,659.14. However, the City had only retained $800.02 of the contractor’s funds. After completing the job the contractor failed to pay some of the materialmen and subcontractors, and liens were filed upon the job which plaintiff paid in the amount of $23,913.85. Plaintiff filed this suit against appellants and the City of Rusten, contending that these defendants were liable to it for the sum which should have been retained from the contractor calculated upon a 7V2% retainage, which amount plaintiff contends would have been available to it to apply upon the liens filed against the job. Plaintiff contended that defendants in the suit were liable to it for this sum because defendants breached their contractual obligations with plaintiff to have protected their security interest in said retainage, and plaintiff alternatively asserted that these defendants owed it a duty under the law of tort to have properly retained under the contract which said defendants negligently failed to do.

The trial court rejected plaintiff’s demand against the City of Rusten and awarded judgment against appellants on the theory of negligence. Plaintiff answers the appeal contending that it should also have judgment against the City of Rusten on the theory of contract.

The substantial issues presented on appeal are:

I. Does the surety of a contractor on a public contract have a cause of action against the public body for sums which the public body should have retained from the contract price of an insolvent contractor, but failed to do so under the following circumstance:
A. where the retainage was needed to pay to lien creditors of the contractor but the funds that should have been retained were paid to the contractor by the public body in good faith in reliance upon certificates of the engineer as to the value of the work performed by the contractor and where the contract authorized the City to make payments on this basis?
II. Does the surety of a contract under which the owner fails to fully comply with the retainage provisions, due to the fault of the engineer, have a claim against the engineer in contract for funds which should have been retained and are needed to pay lien creditors where:
A. the engineer has a contract with the owner to provide the engineering services and to approve the amount of retainage, but who has no contract with the surety?
III. Does the surety have a cause of action in tort against the owner’s engineer on the theory that the engineer having no contractual duties to the surety, nevertheless has a duty to the surety to properly render engineering services with the care and skill that said services are rendered by other engineers performing similar services under like circumstances, and when the engineer in violation of this duty causes the loss of needed retainage?
IV. Assuming a tort cause of action exists under circumstances described in III above, has the surety here established that the engineer failed to perform with the care and skill of other engineers under like circumstances the duty of certifying to the City of Ruston the value of the work performed by the contractor, and if so, how much loss did this breach of duty cause?

LIABILITY OF THE CITY OF RUSTON

The principal authority relied upon by plaintiff for the liability of the City of Ruston for failure to withhold the retainage provided in the sewer construction contract was the federal decision of Claiborne Parish School Board v. Fidelity & Deposit Co. of Maryland, 40 F.2d 577 (5th Cir. 1930). In this case the school board had retained the amount required by the construction contract from the sums due the contractor and then after the completion of the job paid it to the contractor’s bank who was not a lien creditor. The contractor had assigned the retainage to the bank and the school board paid on the basis of the assignment. The school board was aware of the existence of outstanding lien creditors of the contractor at the time it paid the retainage to the bank. The court held the school board liable to the surety in this case because of the bad faith on the part of the school board in depriving the surety of the availability of the retainage with full knowledge that the retainage was necessary and essential to the liquidation of the outstanding lien obligations of the contractor. The court referred to the actions of the school board as being “unlawful conversion and wrongful payment.” Id. p. 578. The crux of the basis of liability was the bad faith of the owner.

That case is distinguishable on its facts from the situation here presented where the City of Ruston’s failure to retain was based upon its good faith reliance upon the certification by the engineer of the value of the work having been completed by the contractor. Neither the engineer nor the City was aware of the contractor’s unpaid bills at the time the retainage was erroneously paid.

The only other Louisiana decision cited by plaintiff as authority for liability on the part of Ruston is the case of Talbert v. Bounds and Allen, 123 So.2d 815 (La.App. 2d Cir. 1960), wherein the owner paid the retainage to the contractor at a time when the owner’s architect was aware of outstanding lien creditors. The court found the owner responsible to the surety for the wrongful disbursal of the retainage because while the owner had no personal knowledge of the outstanding lien creditors of the contractor, the architect had such knowledge and it was imputed to the owner. The rationale of the court is as follows:

“The real basis upon which the owner’s liability must be predicated is the imputation to him of the knowledge of the architect, which was clearly exposed in the letter to which reference is above made. This communication not only conclusively established such knowledge on the part of the architect, but evidenced a complete disregard on his part of the rights of the surety.
It is strenuously urged that, in any event, the owner was entitled to rely upon the certificate of his architect, by which he was fully protected. In support of this position counsel cites the principle of law enunciated in American Jurisprudence, Volume 9, Section 107 (1960 Supplement) to the effect that the owner is not responsible against the surety on the contractor’s bond for mistakes of the architect or engineer which result in payments by the owner made in good faith, even though payments exceed the sums due under the contract. We do not regard this principle as being apropos in the instant case for the fault of the owner, with which he is chargeable and for which he must bear the responsibility, does not lie in the acceptance and payment of an erroneous certificate, but in the violation of the express provisions of the contract to which he was a party with full knowledge of its conditions...” Id. at 825.

The City of Ruston here made no disburs-als of retainage, but rather it followed the contract to which the surety was a party in making the retainage. The contract specifically provided that the owner was to make payments based upon the engineer’s approval of the contractor’s claim for the value of the work performed by it during the previous month, and it was on this basis that the owner made the disbursal. The reason why the retainage was deficient was because the engineer approved the contractor’s claim for the value of the work performed, when in fact the contractor’s claim substantially exceeded the work actually performed, all as will be more fully discussed at the point in this opinion wherein the liability of the engineer to the surety is discussed in detail.

In the case of National American Bank v. Southcoast Contractors, Inc., 276 So.2d 777 (La.App. 1st Cir. 1973), the court denied a surety’s claim against the owner wherein the owner had made the disbursal based upon an architect’s certificate of the estimated value of the work performed, for the reason that the owner, in making the disbursal in this manner, was complying with the terms of the contract. The court there said:

“... The contract specifically provided that payments were to be made to the contractor on the basis of certificates of estimates furnished by the named architect. The owner and lender were absolved from any responsibility as against the surety for any mistakes, errors and omissions of the architect in preparing the certificates...” Id. at 783.

We conclude that an owner who in good faith makes disbursements based upon the certificate of the engineer, which is the manner provided for making such disbursements by the contract to which the surety is a party, has no liability to the surety for deficiencies in retainage brought about by the fault of the engineer.

It is significant that Ruston, based upon the approved certificates of the engineer, only retained 5% of the value of the contractor’s work as certified to by its engineer. The surety contends that Ruston should have retained under the contract 7V2% of the value of the work performed by the contractor. If the City, by the terms of the contract, was required to withhold llh% as retainage, rather than the 5% it purported to withhold, then it could very well be liable to the surety for the portion of the deficiency created by withholding the incorrect percentage of retainage. The City of Ruston was making the disbursals and was fully empowered to make the proper retain-age under the terms of the contract to which it was a party, and the terms of which it must be held to be bound by. The engineer had no responsibility for the percentage of retainage. His duties specified in the contract were limited to the inspection of the work and the certification of the correctness of the contractor’s monthly estimate. The issue is what was the correct percentage of retainage under the contract.

Plaintiff contends that the following quoted provision designated as “32.8 Payment Determination” in the contract governs retainage:

“On or about the last day of each calendar month during construction, the City’s Engineer will estimate the total amount to date of the work done and acceptable according to the specifications, and the value of said work at the price bid or fixed in the contract, including such extra work as may have been approved and completed. Ten percent (10%) of the said value of the work done will be retained by the City. The said percentage will be deducted from the amount earned, and the remainder of the amount earned, less all legal deductions and all previous payments, will be paid to the Contractor not later than the fifteenth (15th) day of the next following calendar month. This ten percent (10%) shall be retained only for the first fifty percent (50%) of value of this contract. After the first fifty percent (50%), five percent (5%) of the value shall be retained from each monthly payment.”

A review of this provision would tend to establish that the correct percentage of the retainage that the City should have withheld, based upon the engineer’s certificate, would be 1lh% and the trial judge so found. The above quoted retainage provision as contained in Section 2 of the General Specifications in the contract is followed later in the contract in Section 3 of the General Specifications, with the following retainage provisions:

“1.0. REQUIREMENTS
Specifications and Contract Requirements for Work Eligible for Federal Participation, Federal Water Pollution Control Act Amendments of 1972 (Public Law 92-500) are incorporated into these specifications as Section 3 of these General Specifications and shall be complied with in every respect except as specifically indicated in this Section.
“5.0. PROMPT PAYMENT The grantee agrees to make payment to its contractor promptly after receipt of Federal sums due under this grant and to retain only such amounts as may be justified by specific circumstances and provisions of this grant or the construction contract.
Retained amounts shall be limited, except where greater retention is necessary under specific circumstances specifically provided for in the construction contract, to the following schedule:
(a) Retention of up to 10% of payments claimed until construction is 50% complete;
(b) After construction is 50% complete, reduction of the total retainage to 5% of payments claimed provided that the contractor is making satisfactory progress and there is no specific cause for greater withholding; ...” [emphasis supplied].

The contract here involved was substantially financed with Federal funds and the contract document at the outset of the contract so provided:

“This contract is to be financed in part by a grant from the United States Environmental Protection Agency and this grant has a Project Number of WPC-LA305 (Grant No. C-22-0305-01-1).”

The provisions cited above from Section 3 of the contract establish that the retainage shall be 5% of the total of the contract unless “greater retention is necessary under specific circumstances specifically provided for in the construction contract.” There are no specific circumstances specifically provided in the clause providing for 7’/z% retention to justify the 2%% re-tainage above the 5% retainage that was therein provided for. Because there are no specific circumstances specifically providing for the additional retainage, Part 1.0 of Section 3 requires that Section 3 specifications which includes the 5% total retention provision “be complied with in every respect.” The City of Ruston, a recipient of a Federal grant, under retainage provision of Section 3 was required to retain only 5% of the value of the work performed by the contractor. It is significant that the contract specifically provides a duty on the part of the surety to be familiar with each and every phase of the contract document. Quoting from the General Specifications, Section 2, we find the following:

“6.0. BONDSMEN WAIVE RIGHT TO SPECIAL NOTICE
It is distinctly understood and agreed that the bondsmen have familiarized themselves with the wording of this contract and that they waive the right of special notification of changes in the plan contemplated in this contract, of extensions of time, of decreased or increased work, of the cancellation of the contract or of any other act or acts by the City of Ruston or its authorized agents under the terms of this contract; failure to notify bondsmen of changes shall in no wise relieve the bondsmen from their obligations under the contract.” [emphasis added].

The surety here was required by the contract to take note of the total reduction in the retainage from 7M¡% provided for in Section 2 of the General Specifications to the 5% mandated by the retainage provision in the General Specifications, Section 3. For the reasons herein set forth, the City of Ruston violated no contractual provision with plaintiff when it only retained 5% based upon the certification of value from its engineer, rather than llA%.

For the reasons set forth, we find the trial court correct in denying plaintiff’s claim against the City of Ruston.

LIABILITY OF THE ENGINEER

Appellants are not a party to the contract between the surety company and owner, even though the contract designates duties for the engineer to perform as agent for the City of Ruston, with which appellants have a separate contract. Plaintiff cannot recover for its loss from appellants on the theory of contract. C. H. Leavell & Co. v. Glantz Contracting Corp. of La., Inc., D.C., 322 F.Supp. 779 (1971).

In the supreme court case of Day v. National U. S. Radiator Corporation, 241 La. 288, 128 So.2d 660 (1961), the court recognized that if an architect had the duty to inspect and approve the installation (there a boiler without a safety pressure release valve), and his breach of this duty caused damage, he could have been held responsible in tort to the widow and children of a workman who was killed when the boiler exploded. The language of the court was as follows:

“Before discussing this holding we should point out that we do not have here a case where the architects failed to provide in the specifications for a pressure relief valve on the boiler and for other safety devices; or a case where they inspected and approved the installation, or even where they had knowledge of the installation and stood by and permitted the boiler to be tested without having proper safety devices; or a case where they visited the site after the completion of the installation and, knowing that the boiler was to be tested, failed to observe that the boiler was not equipped with the safety devices stipulated in the specifications. Under such circumstances we should not hesitate to say that they breached a duty and that they reasonably should have foreseen that this breach would cause damage.” Id. at 666.

The court there found the architect’s contract with the owner did not require him to inspect and approve the installation nor did the architect otherwise fit within the circumstances set forth in the quote, and for that reason plaintiff failed to establish a duty owed by the architect, the breach of which brought about the workman’s death.

The significance of Day, supra, as applicable to appellants’ liability here, is that appellants by the terms of the contract with Ruston had the duty to inspect the work as performed and to approve the estimates of value of the work performed upon which monthly payments were made to the contractor.

In the decision of Calandro Development, Inc. v. R. M. Butler Contr., Inc., 249 So.2d 254 (La.App. 1st Cir. 1971), the court reviewed the cases reflecting a division of authority in other states upon the question of the liability of the owner’s engineer and architect to the surety in a construction contract where no privity of contract existed between the engineer, architect, and surety, and then heavily relying on the quoted rationale of the Louisiana Supreme Court in Day concluded:

“An engineer or architect must be deemed and held to know that his services are for the protection, not only of the interests of the owner, but also the surety on the contractor’s bond who has no supervisory power whatsoever, and who must perforce rely on the architect or engineer to produce a completed project conformable with the contract plans and specifications.. .
We hold that the degree of care owed by an engineer to a surety is the same as that owed to the owner. Our jurisprudence uniformly holds that the duty owed by those practicing learned professions to their clients, patients or retainers, is that of exercising that degree of professional care and skill customarily employed by others of the same profession in the same general area. This test has been applied to engineers in Pittman Construction v. City of New Orleans, La.App., 178 So.2d 312; to architects in Maloney v. Oak Builders, Inc., La.App., 224 So.2d 161; to surveyors in Charles Carter & Co. v. McGee, La.App., 213 So.2d 89; to beauticians in Mixon v. Brechtel, La.App., 174 So. 283; to physicians in Mournet v. Sumner, 19 La.App. 346, 139 So. 728, and to dentists in Thibodeaux v. Aetna Casualty & Surety Co., La.App., 216 So.2d 314.” Id. at 265.

We find the rationale of Calandro sound and conclude it reflects the law of Louisiana. The contract for the construction of the sewer line placed the duty of inspection and approval of the work upon the appellants:

“The City of Ruston (herein frequently called ‘the City’) will, in general, exercise its authority through Pavia-Byrne Engineering Corporation (herein frequently called ‘the Engineer’). The Engineer will assign to the work such personnel in the way of engineers, inspectors and other employees as are necessary to the proper conduct of the work and the inspection of materials and workmanship. All explanations or directions necessary for carrying out and completing satisfactorily the different descriptions of work contemplated and provided for under the plans and specifications will be given by the said Engineers and the Engineers will finally decide all matters of dispute between the City and the Contractor involving the character of the work, its quality, and the compensation therefor. All work under this contract shall be done to the satisfaction of the Engineers who shall in all cases determine the amount, quality, acceptability and fitness of the several kinds of work and materials which are to be paid for hereunder and shall decide all questions which may arise as to the fulfillment of this contract on the part of the Contractor and their determination and decision thereon shall be final and conclusive and such determination and decision, in case any question arises, shall be a condition precedent to the right of the Contractor to receive any money hereunder.” [emphasis added].

The contract further placed upon appellants the duty of approving the monthly application of the contractor for payment based upon the value of the work performed:

“On or about the last day of each calendar month during construction, the City’s Engineer will estimate the total amount to date of the work done and acceptable according to the specifications, and the value of said work at the prices bid or fixed in the contract...”

Edgar H. Pavia admitted the duty of appellants to inspect and approve payments to the contractor. We quote with approval from the excellent written reasons of the trial judge wherein he found appellants violated the duty owed by them to the surety: “... The question to be resolved in this case is whether there was negligence on the part of Pavia-Byrne Engineering Corporation that resulted in the reduction of the retain-age and accordingly the loss that plaintiff sustained as a result of being surety on the contract between D. T. Atkison and the City of Ruston.

In order to fulfill its responsibility in connection with the work to be done, Pavia-Byrne Engineering Corporation employed a resident inspector. The resident inspector, L. L. Mitchell, was on the job site daily in connection with the work done by D. T. Atkison. The evidence in record indicates that L. L. Mitchell had previously served as a resident inspector in connection with certain construction projects. However, the previous experience of L. L. Mitchell had been in connection with building inspections and he had never before served as a resident inspector in connection with pipeline construction work. Mr. Mitchell testified that he did not know that this was a unit price contract until about a month after the work had started. He further testified that he did not keep any notes relative to the quality or quantity of material used by the contractor nor did he keep any separate notes showing his manner of computation of the pipe placed on the ground. Mr. Mitchell insisted that this was not a complicated job to inspect. It appears that Mr. Mitchell utilized, almost exclusively, the distances shown on the plans and specifications in approving the estimates. Mr. Mitchell would determine the quantity of pipe used by reference to the plans and specifications. He did not check the pipe as placed in the ground or physically tape the lineal feet of pipe and verify the distance with grade, contour or elevation computation.

Edgar Pavia was the President and chief engineer of Pavia-Byrne Engineering Corporation. Mr. Pavia resides in Orleans Parish and it was his testimony that he would, when necessary, inspect the job site. He estimated that he was probably never gone from the job site more than two weeks at a time. The matter of the payment of the estimates submitted by the contractor was routinely handled by being submitted to L. L. Mitchell and approved by him. The estimates were then forwarded to Mr. Pavia in New Orleans and were approved by him for payment.

The evidence and testimony in this case leaves no doubt that Edgar Pavia approved the estimates and certified to the City of Ruston that payment should be made of the estimate. Typical of the testimony by Edgar Pavia relating to the approval of the estimates and the authorization of payment is the following:

Q. Are these now two of the main — the two primary duties of an engineer in inspecting the job is to inspect the quality of work and also to keep up with the work done by the contractor for the purpose of certifying to the owner his payments?
A. Yes.
Q. Would you say that’s the two primary responsibilities of an engineer on a job such as this?
A. Well, Mr. Mitchell was an inspector on the job, he’s not an engineer.
Q. I’m talking about Pavia-Byrne Engineer-Corporation?
A. Oh, yes, that was your responsibility, yes.
Q. And all of Pavia-Byrne Engineering Corporation certifications for payment were made based on the information supplied by Mr. Mitchell, is that not correct? A. Yes, not totally supplied by him but supplied by the contractor and checked with him.” (tr. 133-134)

When you consider all of the testimony, it is clear to the court the procedure in this matter was that L. L. Mitchell was approving the estimate based almost entirely on merely locating where the work was in progress by reference to plans and specifications and then approving this for payment without actually physically checking and calculating the lineal feet of pipe and the quality of the pipe used. When this approval by L. L. Mitchell was made, Edgar Pavia, without any verification on the site and as the engineer, approved the estimates submitted and signed the certificate to the City of Ruston authorizing payment.

Mr. Robert Aillet, an engineer who was called by the plaintiff, testified in the matter and was asked by the court a hypothetical question concerning the frequency of inspection and authorization of payment. It was his testimony that on this particular contract, considering the job and other circumstances, the engineer should inspect the job weekly in order to make certifications of accuracy. The testimony on the matter by Mr. Aillet is as follows:

‘THE COURT: All right, now, assuming that there were a job in Ruston, a construction job of laying a fourteen inch sewer line and the contract required the engineer to inspect the line and to verify or certify periodic payments and that a layman was employed as an inspector, in your opinion as an engineer, how often should the engineer visit or see the job site and verify the work? In your opinion?
THE WITNESS: Your Honor, I think— I’ll have to qualify an answer there. I think it would depend on the progress of the work or the nature of the work but I would think that say a job of this magnitude should be probably weekly in order to be able to make certain certifications of accuracy.
THE COURT: By the engineer?
THE WITNESS: By the engineer.’ (Tr. 70).

In this case there is no question but that Edgar Pavia signed the certification and authorized payment without any inspection of the work covered by the particular estimate. The engineer would take the position that he signed it because the requirement was that a registered engineer signed the estimate. The testimony of Mr. Pavia in this regard is as follows:

‘THE COURT: Is it customary for an engineer such as you to certify payments to an owner on progress payments based upon information from a lay inspector who is not an engineer?
THE WITNESS: It’s done quite often, Your Honor.
THE COURT: I mean is it — is it the accepted practice within the engineering profession?
THE WITNESS: Yes, to — it depends on who, how the job is being carried out and how the job is staffed and manned for inspection. In this case the City of Ru-ston knew we had Mr. Mitchell as our inspector, they approved of Mr. Mitchell, they were satisfied that we had an inspector who would look out for the quality of the work. On that basis Mr. Mitchell not being a registered engineer could not sign the monthly estimates. The City of Ruston was looking to the firm as a representative of the firm we had to have a professional engineer so I signed it. THE COURT: And you would...
THE WITNESS: We had others but I was handling the Ruston program so I... THE COURT: And it would be your testimony at least to some of those you signed you had never been on the job site?
THE WITNESS: I’m sorry, I didn’t understand you.
THE COURT: As to at least some of the estimates, you had not been on the job site yourself?
THE WITNESS: You mean to check that particular estimate?
THE COURT: Right?
THE WITNESS: Yes, sir, I’d have to say that...’ (Tr. 154-155).

The court does not have to determine if damage or loss sustained by plaintiff resulted from the negligence of L. L. Mitchell or Edgar Pavia. They were both employees of Pavia-Byrne Engineering Corporation and the employer would be liable to the plaintiff for loss or damage. However, the court is of the opinion from the testimony and evidence that both of the parties were negligent in performance of their respective duties in connection with the work performed by D. T. Atkison under the contract with the City of Ruston.

L. L. Mitchell relied almost totally on the estimates prepared by the contractor and the plans and specifications so far as making or verifying a computation. Edgar Pa-via signed and approved payment because an engineer’s signature was ‘required’ in order for payment to be made. He did not inspect the work as it progressed nor attempt to verify the estimate submitted by the contractor. It is true as testified by the engineer called by the defendant, Doan Mo-dianos, that technicians are used by engineers to assist in fulfilling an engineer’s responsibility under the contract. However, this expert testified that there was limited verification of the work as done by the technicians. Edgar Pavia’s testimony was that he signed the estimates and approved them for payment without any verification.

The defendant engineering firm did not fulfill its responsibility and exercise the degree of care that is normally exercised by an engineer in a similar situation. The lack of the exercise of this degree of care has resulted in a loss to the surety under the contract and the engineer is responsible.”

Substantial evidence in the record, and reasonable inferences therefrom, support the finding of facts set forth by the trial judge and we find him not to be clearly wrong.

After all the work required to be performed under the terms of the contract was completed, the job was inspected by Edgar Pavia and the value of the work calculated on the unit price applicable to the various units was found to be $233,182.80, five percent (5%) of which, or the sum of $11,659.14, should have been at this time still in the possession of the owner. Plaintiff alleged, and the appellants admitted in their answer to the interrogatories, that the owner only had in its possession a retainage of $800.02 of the funds belonging to the contractor. The reason for the $10,859.12 deficiency in the retainage was that the value of the work performed monthly had been overestimated by the contractor, which overestimation had been approved by appellants and paid by the City. All of the deficiency in the retainage except for the small sum of $89.00 can be found in two specific areas of the engineer's neglect which created the overpayment to the contractor.

The contract provides that the contractor was to receive substantially less for the installation of pipe pressure rated at 47 PSI than it was to receive for the installation of pipe pressure rated at 100 PSI. Upon final inspection it was determined that the engineer had approved payment for installation of substantial footage of 47 PSI pipe at the unit price provided for installation of 100 PSI pipe, resulting in an overpayment of $7330.05 to the contractor on his monthly estimates. If the resident inspector had been checking the kind, quality and footage of the two types of pipe as they were being placed into the ground, this overpayment would not have occurred. If Edgar Pavia had been making the weekly job inspection tours which engineers should make, as established by plaintiff’s engineer expert, and had checked the kind, quality and footage of the two types of pipe that were being installed in each given week, this error should not have occurred. The appellants breached the duty to inspect which caused a breach of duty to disapprove the contractor’s applications for excessive payment for the value of the work that was not performed.

The other error neglect, which resulted in an overpayment of $3440, came about because of a confused state of facts, most of which are not clearly established in the record. What apparently happened was that three property owners observed the approach of the sewer line excavation and believing their driveways would be cut by the ditch and thereby damaged, made a deal with some employee of the contractor to bore under their driveways rather than cut through them. These property owners apparently were unaware that the contract required the contractor to bore under the driveways. There is no evidence in the record which establishes how much was paid by the property owners or to whom the payment was made, or whether or not the amount of such payment was ever in fact received by the contractor or someone authorized by him. Pavia testified that during the construction he heard rumors of the driveway transaction but made no effort to substantiate or verify any of the facts. Regardless of what the facts may have been at the time of the final inspection, Edgar Pavia, exercising the right of control over the work as given the engineer by the contract, applied the lesser unit price for a cut ditch to the area of driveways in question rather than the higher unit price of a bored ditch in determining the total consideration to which the contractor was entitled. Pavia reasoned the contractor had received from the property owners the difference between the price of a cut ditch and a bored ditch. This calculation resulted in reduction of the amount to which the contractor was entitled and therefore a reduction in the retain-age. The problem was created because the engineer failed to make the reduction in the price paid the contractor in the estimate that the contractor submitted for the month that he placed the line under the driveways of the property owners, and as a result the contractor was overpaid by $3440 that particular month. Accepting as correct the engineer’s ultimate solution of the problem of the overzealous property owners who would have received a bored ditch under their driveway under the contract, we can only conclude that if the resident inspector had properly observed the job and checked out the rumor, or if the engineer had been making his weekly inspection trips and had proceeded to solve the problem by an earlier adjustment on one of the monthly work estimates, the retainage would not have been reduced at the end of the work by this sum of $3440.

In brief appellants argue that this $3440 is now in the hands of the City and that if it is the property of the contractor, it belongs to the contractor’s surety and under no circumstances can appellants be responsible for it as the trial judge determined. Our answer to this contention is that appellants made the decision that the contractor was not entitled to the $3440 under the prerogative the engineers were given by the construction contract, and if the contractor is not entitled to it, then the City can not possibly be retaining it as the property of the contractor and the surety can have no claim against it from the City. The appellants admitted the City only retained $800.02 of the contractor’s funds.

Although we have not been able to determine from the record where the remaining $89 on lost retainage came into being, we cannot conclude the trial judge was manifestly erroneous in concluding that it was also lost due to inadequate inspection performed by appellants.

Appellants argue that their expert engineer testified that it was common to have an error of 1%% made by engineers in the estimates for retainage purposes, and for this reason any award against them should be reduced by 1W%> of the total value of the work completed. Plaintiff’s expert engineer did not subscribe to this theory and we do not find the trial judge’s refusal to apply it clearly wrong. If the engineer had properly done its duty there may have very well been no deficiency in the retain-age.

It is our view, for the reasons set forth, that appellants have violated their duty to skillfully inspect the work as it progressed and properly calculate the estimated value of the contractor’s work for the purpose of paying him his monthly estimate and that their failure to perform this duty, which was owed not only to the owner, but also to the surety, has brought about a loss to the surety of $10,859.12. The trial judge not only found the engineer negligent in causing the loss set forth by us above, but also found the engineer responsible for the owner’s failure to retain llA% rather than 5%. At the outset we point out that the engineer had no responsibility for determining the correct percentage of retainage. The engineer’s responsibility was to determine the value of the work performed upon which payment was to be made less the retainage which was to be determined and applied by the owner. It was the owner’s contract with the contractor that authorized the retainage and spelled out the amount of it. As we have earlier pointed out, the correct amount of the owner’s retainage here was 5%, but had it been Th% and had the owner only withheld 5%, the responsibility for the percentage of the retainage withheld would not have been upon the engineer who had no duty to the surety with regard to the correct percentage of the retainage. No neglect or action on the part of appellants could create any liability for them by virtue of the owner’s failure to withhold the proper percentage from the contractor’s funds.

The trial court’s judgment in favor of the surety and against appellants for TA% of the work actually performed, less the $800.02 retained, is incorrect and must be reduced by 2lA% X $233,182.80 (value of the work performed) or the sum of $5829.57, resulting in the proper judgment against appellants being the sum of $10,859.14.

In order to reflect the reduction of the judgment in favor of plaintiff and against appellants, we recast the next to last paragraph of the judgment appealed from to read as follows:

IT IS ORDERED, ADJUDGED AND DECREED that:

1. There be judgment herein in favor of the plaintiff, American Fidelity Fire Insurance Company, and against the defendants, Edgar H. Pavia and Pavia-Byrne Engineering Corporation in solido, in the sum of $10,859.14, together with legal interest from date of judicial demand (July 26, 1978) until paid, and for all costs of court.

As AMENDED, judgment is AFFIRMED at appellants’ cost.

      . We find the following statement of the law in 17 American Jurisprudence 2d, Section 105: “Also, it is well settled that under a public works contract which requires, as a condition of payments to the contractor, a certificate or estimate of an architect, engineer, or other person designated in the contract, showing the amounts due, the surety is not discharged from liability to the public body by reason of payments made in good faith in accordance with overestimates or erroneous certificates, although such payments exceed, in fact, the sums due under the contract.” Id. p. 282.

      . The trial judge filed supplemental reasons specifically imputing the negligence of L. L. Mitchell and Edgar Pavia to their employer Pavia Byrne Engineering Corporation and finding Edgar H. Pavia liable to plaintiff in solido with his employer and appellants have assigned no error to these particular conclusions and the solidary judgment against them.

      . The engineer will finally decide all matters of dispute between the City and the contractor involving the character of the work, its quality, and the compensation therefor.


source: Caselaw Access Project

author: MARVIN, Judge.

license: Public Domain

text:
    DEL B. ROBINSON INSURANCE AGENCY, Plaintiff-Appellant, v. BILL RANEY & MEL WRIGHT PAINT & BODY SHOP, INC., Defendant-Appellee.
    No. 14404.
    Court of Appeal of Louisiana, Second Circuit.
    Jan. 13, 1981.
    Charles R. Rowe, Bossier City, for plaintiff-appellant.
    James Hall, Bossier City, for defendant-appellee.
    Before PRICE, MARVIN and JASPER E. JONES, JJ.
   MARVIN, Judge.

The agent appeals from a judgment rejecting his demands against a customer for premiums due on a 1978 policy of workmen’s compensation and garage owner’s liability insurance. The issue is credibility. We affirm.

The agent says he wrote the 1978 policy and delivered it to the garage owner as he had done in 1976 and in 1977. Premiums were estimated during each policy period on the basis of the volume of vehicles in the garage and the amount of the garage owner’s payroll. The garage owner’s books are eventually audited and some adjustments to the premium are made at a later time. During each of the policy periods 1976 and 1977 the garage owner made an initial or down payment on the total premium and completed paying the remainder by making monthly payments to a bank under a premium finance plan.

The garage owner testified that when the agent verbally estimated the 1978 premium to him he told the agent that he could not afford to pay the premium and would look elsewhere for insurance coverage. The garage owner expressly denied admitting to the agent’s representative that he knew he was “covered” in 1978 and that the 1978 policy was “delivered” to him in December 1978. The agent explained that the “late” delivery in December of a policy, allegedly for coverage beginning July 16, 1978, was because of delays and backlog in the office of the insurer.

Whether or not the garage owner contracted for an insurance policy in 1978 is a question of fact, here resolved by the trier of fact adversely to appellant. The trial court’s resolution of conflicting evidence is supported by substantial testimony and is not manifestly erroneous. See Arceneaux v. Domingue, 365 So.2d 1330 (La.1978); Canter v. Koehring Company, 283 So.2d 716 (La.1973).

At appellant’s cost, judgment is AFFIRMED.


text:
    Bennie BOOKER, Plaintiff-Appellant, v. PIGGLY WIGGLY CORPORATION, Defendant-Appellee.
    No. 14405.
    Court of Appeal of Louisiana, Second Circuit.
    Jan. 13, 1981.

      Edward Larvadain, Jr., Alexandria, for plaintiff-appellant.
    Hayes, Harkey, Smith & Cascio by Haynes L. Harkey, Jr., Monroe, for defendant-appellee.
    Before PRICE, MARVIN and JASPER E. JONES, JJ.
   MARVIN, Judge.

Some six weeks before the first anniversary of an alleged slip and fall in a Piggly Wiggly grocery in Winnfield, plaintiff sued the non-resident franchisor, Piggly Wiggly Corporation, for damages.

Thereafter, but still before the anniversary of the alleged accident, plaintiff’s counsel was informed in writing, of the name and address of the franchisee and of its agent for service of process, that the franchisor did not own, operate, or maintain the store, and that the proper party defendant was the franchisee of the store, a Louisiana corporation, Winnfield Piggly Wiggly, Inc.

More than 24 months after plaintiff learned these things, plaintiff amended her petition in an attempt to substitute the franchisee as the defendant in the case. The franchisee then filed an exception of one year liberative prescription which was sustained. She appealed. We affirm.

The Supreme Court has indicated in its writ consideration in Clark v. McDonald’s System, Inc., 386 So.2d 95 (La.1980), that a suit against a franchisor interrupts prescription against a franchisee where the franchisee is joined as a defendant after the anniversary date of the alleged accident. There the plaintiff joined the franchisee of a McDonald’s restaurant two days after the franchisor asserted in a motion for summary judgment that another and not the franchisor owned and operated the restaurant where the alleged accident occurred.

Here the plaintiff learned of the proper party defendant and where and through whom that defendant could be served even before the anniversary of the alleged accident and plaintiff allowed 24 months to elapse before attempting to name the franchisee as defendant in the case.

As to solidary obligors, it is true that, once interrupted by the filing of a suit against one obligor, liberative prescription against another solidary obligor remains interrupted for as long as that suit is pending, but here, plaintiff has not shown and does not contend that the franchisee and franchisor are solidary obligors.

A plaintiff must exercise reasonable diligence in ascertaining the identity of the party injuring him. Dean v. Hercules, Inc., 328 So.2d 69 (La.1976); Martin v. Mud Supply Company, 239 La. 616, 119 So.2d 484 (1960). That obligation should follow plaintiff during the course of the transaction or the litigation out of which plaintiff claims an interruption of prescription. For example, a vendor’s attempt to remedy a redhibi-tory vice interrupts the liberative prescription accruing against a vendee who has discovered the vice. The interruption, however, does not continue indefinitely and the liberative prescription begins to run anew when the vendor’s attempt to remedy is concluded. See Hermeling v. Whitmore, 140 So.2d 257 (La.App. 1st Cir. 1961) and Smith’s Materials on Sales and Leases by Litvinoff at p. 386. Similarly, the interruption of the liberative prescription of non-use of a mineral servitude by the drilling of a well in search of oil does not continue indefinitely but ends when the well is abandoned as a dry hole or is shut-in after testing. See LRS 31:30 and 34. That is the very nature of an interruption of liberative prescription.

We hold then that when a plaintiff learns the name and address of the proper but unnamed defendant, who is not solidarily obligated with the named defendant, the interruption or claimed interruption of prescription against the unnamed defendant is ended and prescription then begins to run anew. Here, plaintiff learned of the name and address of the unnamed defendant more than one year before she filed her amended petition seeking to substitute defendants on January 7, 1980.

AFFIRMED at appellant’s cost.

      . This alleged accident occurred January 24, 1977.
      The franchisor was sued December 8, 1977. On December 20, 1977, and on December 23, 1977, plaintiffs original counsel was informed by letter from the franchisor’s general counsel that the franchisor did not own, operate, or maintain the Winnfield Piggly Wiggly store and suggested that the franchisee, Winnfield Piggly Wiggly, Inc. be substituted as the proper party defendant.
      On December 30, 1977, in written reply to a letter from plaintiffs counsel dated December 27, 1977, the president of the franchisee informed plaintiff’s counsel of the name and address of the franchisee’s agent for service of process.
      On January 18, 1978, plaintiff’s counsel inquired to the franchisee’s agent for service of process and was advised in a letter of January 20, 1978, that he was indeed the agent for service of process for the franchisee corporation.
      On January 7, 1980, plaintiff filed an amended petition substituting the franchisee as defendant.
      On January 18, 1980, the franchisee filed the exception of prescription which was sustained on May 29, 1980.
      Here the franchisee learned of the plaintiff’s suit about the same time that plaintiffs counsel learned of the correct name and address of the franchisee and its agent for service of process.
      Plaintiff’s present counsel argues in brief that settlement negotiations were conducted with plaintiff and a counsel for plaintiff in 1979. This evidence, even if admissible, is not in the record and we are not persuaded by this argument to a contrary result. See Broussard v. State Farm Mutual Automobile Ins. Co., 188 So.2d 111 (La.App. 3d Cir. 1966). The burden of proving an interruption or suspension of, or an estoppel to claim, prescription is on him who makes the contention. See Cordova v. Hartford Acc. & Indem. Co., 378 So.2d 1088 (La.App. 3d Cir. 1979).

      . The amending petition seeks to delete the franchisor and to insert the franchisee as the sole defendant in the original petition. The amending petition asks that service be made on the agent for service of process and at the address which was furnished plaintiff’s counsel in the letter of December 30, 1977, from the president of the franchisee. This letter reads in part:
      “The Piggly Wiggly Corporation does not own the Winnfield Piggly Wiggly Store. It is incorporated as Winnfield Piggly Wiggly, Inc. and the registered agent is Mr. Haynes L. Harkey, Jr., 1504 Stubbs Ave., Monroe, La. 71201.”

      . CC 2095, 2097; Burch v. Hartford Accident and Indemnity Company, 172 So.2d 165 (La. App. 1st Cir. 1964). See also LRS 9:5801; Ticheli v. Silmon, 304 So.2d 792 (La.App. 2d Cir. 1974).


author: FRED W. JONES, Judge.

text:
    Donald R. DeSOTO, Plaintiff-Appellant, v. Kenneth Donald ELLIS et al, Defendants-Appellees.
    No. 14407.
    Court of Appeal of Louisiana, Second Circuit.
    Jan. 13, 1981.

      Leroy H. Scott, Shreveport, for plaintiff-appellant.
    Mayer, Smith & Roberts by A. J. Gregory, Jr., Shreveport, for defendant-appellee, Oscar Cloyd, Inc.
    Love, Rigby, Dehan, Love & McDaniel by J. Philip Goode, Jr., Shreveport, for defendant-appellee, Shreve Land Co., Inc.
    Before PRICE, HALL and FRED W. JONES, JJ.
   FRED W. JONES, Judge.

Plaintiff-homeowner sued his vendor and the latter’s vendor together with the original owner-contractor for a reduction in the purchase price of his dwelling because of damages caused by an unstable foundation. Also joined as a party defendant was the real estate broker who handled the sale of the involved property to plaintiff. The owner-contractor filed a plea of one year liberative prescription, which was sustained. Judgment was subsequently rendered in favor of the real estate broker, dismissing plaintiff’s suit. Plaintiff appeals these judgments.

We affirm.

Context Facts

The record reveals the following pertinent chronology of events:

February 2, 1971 — Shreve Land Company, Inc., sells to Hal J. Thompson the house and lot involved in this litigation; vendor had constructed house in a Shreveport subdivision on a speculative basis.
May 29,1974 — Thompson sells the property to John C. Crawford.
October 11, 1976 — letter from James D. Mohr, civil engineer, to Oscar Cloyd, Realtor, giving results of inspection of subject property and recommending that work be done on foundation, including underpinning, to make structurally sound. Realtor acts on behalf of Crawford to have the work performed.
March 8, 1977 — Crawford sells the property to Kenneth D. Ellis.
March 10,1977 — letter from Mohr to Ellis stating that work on house foundation had been completed and “it is my opinion that the house is safe and will not settle in these places.” Copy of this letter placed in realtor’s files.
June 15, 1977 — plaintiff executes purchase agreement covering involved property; real estate broker is Oscar Cloyd, Realtor, represented by its salesman, Wilbur Whisby; latter has had no prior dealings with this property and is unaware of previous problems with foundation; no one else mentions this matter to plaintiff.
July 13, 1977 — Ellis sells the property to plaintiff; prior to this Whisby examines Cloyd’s file on the property and reads engineer’s letter pertaining to repair of unstable foundation, but does not transmit this information to plaintiff before or at time of consummation of sale.
October, 1977 — plaintiff notices Vz inch wide crack in brick work on side of house; interior cracks develop two or three months later; plaintiff carefully inspected house prior to sale and noticed no defects of this nature at that time.
November 21, 1977 — letter from Mohr to plaintiff giving results of recent inspection of subject property, stating that there had been additional settling of foundation since repair work, and recommending underpinning and jacking up of foundation; Mohr stated that cracks found in November, 1977 were same as those he observed in October, 1976.
July 13, 1978 — plaintiff files this suit.
Liability of Shreve Land Co., Inc.

In suits over building defects by subvendees against predecessors in the chain of title, including owner-contractors, Louisiana courts have consistently recognized the cause of action as coming under the warranty provisions of La.Civil Code Art. 2503, reasoning that a subvendee is entitled to bring any action the vendor could have brought against his vendor. See McEachern v. Planche Lumber & Construction Co., 220 La. 696, 57 So.2d 405 (1952); Breaux v. Laird, 230 La. 221, 88 So.2d 33 (1956). Consequently, a subvendee is subro-gated to the rights of his vendor and his vendor’s warranty against redhibitory defects from the vendor who sold the property to him, and so on up the chain of title.

The cause of action asserted by plaintiff in his petition, as to prior vendors in his chain of title, is clearly one to reduce the purchase price of his home because of a redhibitory vice. However, appellant argues that the trial judge erred in holding that the one year prescriptive period for redhibitory actions was applicable to the claim against Shreve Land Co., Inc. rather than the ten year prescriptive period provided for by La.Civil Code Arts. 2762 and 3545.

This precise question was considered in Hermeling v. Whitmore, 140 So.2d 257 (La. App. 1st Cir. 1961). There the plaintiff sued his vendor to rescind the sale of a house and lot because of redhibitory vices in the house. Prior vendors, including the builder of the house, were made parties to the litigation through third party demands. One of plaintiff’s contentions was that the builder was liable under C.C. Art. 2762. Finding that the builder had constructed the house as a speculation, the court rejected plaintiff’s argument with this explanation:

“Counsel has cited no case, and we know of none, which has applied LSA-Civil Code Article 2762 to the situation where the builder constructs a house to his own plans and specifications and thereafter puts the building and lot on the market for sale. In such a case the builder is treated as a vendor and Article 2762 does not apply.”

In this case Shreve Land Co., Inc., built the house in question as a speculative venture, and not specifically for its vendee Thompson. It is considered as a vendor rather than an “undertaker” under Articles 2762 and 3545. Therefore, the trial judge correctly held, consistent with the Hermel-ing ruling, that the applicable prescriptive period as to the action against this defendant is that of one year for redhibitory actions.

The next question is when the one year prescriptive period began to run against Shreve Land Co., Inc. Our jurisprudence has established the legal principal that an owner-contractor is presumed to have knowledge of latent defects and, for that reason, prescription does not begin to run as against that builder as to such defects until the date of their discovery, as provided for by La.C.C. Art. 2546. See Tuminello v. Mawby, 220 La. 733, 57 So.2d 666 (1952); Johnson v. Hunter, 88 So.2d 467 (La.App. 2d Cir. 1956); Hermeling v. Whitmore, supra; Hill v. Crosby, Inc., 353 So.2d 421 (La.App. 4th Cir. 1977).

Here the latent defect, an unstable foundation manifested by cracks in exterior walls, was discovered in October, 1976. Plaintiff’s immediate predecessors in title had one year from that date to institute their redhibitory action. Under his warranty deed plaintiff acquired that right. Since his suit was not filed until July, 1978, the one year prescriptive period had elapsed. Therefore, the trial judge properly sustained this defendant’s plea of prescription.

Liability of Oscar Cloyd, Inc.

Appellant contends that the trial judge erred in holding that there was no duty on the part of Cloyd’s salesman, Whisby, to disclose prior defects in the house purchased by plaintiff merely because the salesman believed that these defects had been repaired.

The confused state of our law relating to the duty owed by real estate brokers to purchasers was summarized by the Louisiana Supreme Court in Latter & Blum, Inc. v. Richmond, 388 So.2d 368 (La.1980) as follows:

“Courts and commentators in Louisiana have wrestled for years with the problem of attempting to define the duties of brokers, particularly real estate brokers, (citations omitted) The Louisiana Civil Code Articles relied upon by the Court of Appeal define a ‘broker’ as a person ‘employed to negotiate a matter between two parties, and who for that reason, is considered as a mandatary of both.’ La.Civ. Code art. 3016. The obligations of a broker differ from those of an ordinary man-datary in that ‘his engagement is double, and requires that he should observe the same fidelity towards all parties, and not favor one more than another.’ La.Civ.C. art. 3017. However, the courts in Louisiana have supplemented the Code’s mandate articles by reference to common law rules relating to brokerage contracts. 19 La.L.Rev. 794-795. Other duties are imposed upon real estate brokers as the result of the passage of special real estate statutes. See R.S. 37:1431 et seq.
“The jurisprudence on the nature and source of the real estate broker’s duties seems confusing even in the relatively straightforward situation where the broker is employed to find a buyer for the property. Some cases impose ‘common mandatary’ status on the broker at the time he has found a prospective purchaser (citations omitted); another has held that a broker becomes a dual fiduciary only after a transaction is consummated (citation omitted), while at least one case has held that the Code articles on mandate do not apply to real estate brokers at all and brokers’ duties are limited to those imposed by the real estate licensing statute, (citation omitted)
“In Amato v. Latter & Blum, Inc., 227 La. 537, 79 So.2d 873 (La.1956) this Court found that a real estate broker breached his duty to the public at large imposed by the real estate licensing statute when he failed to transmit an offer to his principal, the prospective vendor.”
The court then concluded:
“Ultimately the precise duties of a real estate broker must be determined by an examination of the nature of the task the real estate agent undertakes to perform and the agreements he makes with the involved parties.”

However, no attempt was made to delineate those duties.

In White v. Lamar Realty, Inc., 303 So.2d 598 (La.App. 2d Cir. 1974) this court rejected a claim for damages against real estate brokers, pointing out that under La.C.C. Art. 3018 brokers are responsible only for fraud or faults. Recovery was also denied because the acts of defendants were deemed neither wrongful nor negligent under La.C.C. Articles 2315 and 2316.

The plaintiff in Davis v. Davis, 353 So.2d 1060 (La.App. 2d Cir. 1977) filed a suit in redhibition against his vendor because of a flooding problem. Also joined as defendants were realtors who had been involved in the sales transaction. We pointed out that:

“Plaintiffs’ remedy against the realtors is in damages for fraud under La.C.C. Art. 1847(9), or for negligent misrepresentation under La.C.C. Art. 2315.”

Regardless of the various legal sources cited as bases for elucidation of the duties owed by real estate brokers to prospective purchasers, it seems clear that Louisiana has relaxed the traditional rule that the broker owes duties only to the vendor. Whatever the precise scope of those duties there should be no question but that a real estate broker has a duty to reveal to a prospective purchaser the existence of a material defect in the premises under consideration. Obviously, in the normal course of events this would be a critical factor in the purchaser’s decision to consummate the transaction or, at least, have considerable bearing on the purchase price.

The question in our case is whether, under these factual circumstances, Whisby should have informed plaintiff of the prior problems with the unstable house foundation. Preliminary to answering this, we emphasize that Whisby did not conceal the existence of a known defect. Therefore, fraud was not involved. The issue, then, is whether Whisby was negligent in his conclusion that there was no necessity to inform plaintiff of a defect that had apparently been remedied, as explained in the letter (from a civil engineer) contained in the broker’s files.

Concluding that, based upon the available information, any reasonable person could have well reached the same decision as Whisby, we find that Whisby was not negligent and that the trial judge acted properly in dismissing the suit against Oscar Cloyd, Inc., for lack of liability.

Conclusion

For the reasons set forth, we affirm the judgments of the trial court, at appellant’s cost.

      . According to the record, these two defendants never received service of process nor was personal jurisdiction over them obtained in any other way. Therefore, they are not mentioned in the judgments.

      . The parties may, by particular agreement, add to the obligation of warranty, which results of right from the sale, or diminish its effect; they may even agree that the seller shall not be subject to any warranty.
      But whether warranty be excluded or not the buyer shall become subrogated to the seller’s rights and actions in warranty against all others.

      . Whether the defect in the thing sold be such as to render it useless and altogether unsuited to its purpose, or whether it be such as merely to diminish the value, the buyer may limit his demand to reduction of the price.

      . La.C.C. Art. 2534 provides in part: “The re-dhibitory action must be instituted within a year, at the farthest, commencing from the date of the sale. This limitation does not apply where the seller had knowledge of the vice and neglected to declare it to the purchaser.”

      .Art. 2762. If a building, which an architect or other workman has undertaken to make by the job, should fall to ruin either in whole or in part, on account of the badness of the workmanship, the architect or undertaker shall bear the loss if the building falls to ruin in the course of ten years, if it be a stone or brick building, and of five years if it be built in wood or with frames filled with bricks.
      Art. 3545. The action against an undertaker or architect, for defect or [of] construction of buildings of brick or stone, is prescribed by ten years.

      . In view of the fact that more than one year elapsed between the time that Crawford attempted to remedy the defect and the filing of plaintiffs suit, we are not confronted with the question of whether that served to interrupt the running of prescription. However, the jurisprudence indicates that this interruption occurs as to the owner-contractor only if he attempts to have the repairs made. See Brown v. Dauzat, 157 So.2d 570 (La.App. 3rd Cir. 1963).

      . For an excellent exegesis of this subject, see Comment, The Real Estate Broker-Purchaser Relationship: Louisiana and Common Law, 52 Tul.Law Review 157 (1977).


author: HALL, Judge.

text:
    Jerry Wayne JENKINS, Plaintiff-Appellee, v. ST. PAUL FIRE & MARINE INSURANCE COMPANY et al., Defendants-Appellants.
    No. 14411.
    Court of Appeal of Louisiana, Second Circuit.
    Jan. 13, 1981.
    En Banc. Rehearing Denied Feb. 19, 1981.

      Mayer, Smith & Roberts by Alex F. Smith and George T. Allen, Shreveport, for defendants-appellants, John B. Morneau and St. Paul Fire & Marine Ins. Co.
    Charles E. Tooke, Jr., Shreveport, defendant-appellant, in pro. per.
    Richie & Richie by John A. Richie and C. Vernon Richie, Edward 0. Kernaghan, Shreveport, for plaintiff-appellee, Jerry Wayne Jenkins.
    Before PRICE, HALL and FRED W. JONES, Jr., JJ.
   HALL, Judge.

Plaintiff, Jerry Wayne Jenkins, was seriously injured when the pickup truck he was driving was struck by a train at a crossing in Plain Dealing, Louisiana. He employed Charles E. Tooke, Jr., an attorney, who with plaintiff’s consent associated John B. Mor-neau, another attorney, to pursue a tort claim against the railroad company. Suit was filed by the attorneys two days after prescription had run, resulting in the suit being dismissed.

Plaintiff filed this malpractice action . against the attorneys and Morneau’s professional liability insurer (Tooke was uninsured), alleging their negligence in allowing the claim to prescribe and alleging that, but for their negligence, he would have recovered damages from the railroad. Both attorneys denied their negligence and denied that plaintiff could have recovered from the railroad. Tooke made a third party demand against Morneau, seeking recovery from him for any amount Tooke might be cast in judgment.

After trial before a jury on the issues of the attorneys’ negligence and the liability of the railroad to plaintiff, the jury, in answer to interrogatories, found that Mor-neau and Tooke were both negligent, the railroad was guilty of negligence which was a cause of the accident, plaintiff was not guilty of negligence which was a cause of the accident, and Tooke was not entitled to judgment over against Morneau. A verdict was rendered in favor of the plaintiff for $87,000. From a judgment for that amount in favor of plaintiff against all defendants, the defendants appealed. Plaintiff answered the appeal.

On appeal, Morneau and his insurer assign as error (1) the jury’s finding that plaintiff was not contributorily negligent; (2) the jury’s finding that the railroad was guilty of negligence; and (3) the jury’s finding that Morneau was guilty of negligence.

Tooke assigns as error the jury’s findings that (1) the railroad was negligent; (2) Tooke’s action, activities and services rendered were not commensurate with his responsibilities under the circumstances; and

(3) Tooke was not entitled to look to Mor-neau with respect to the suit being timely filed.

Plaintiff assigns as error (1) the trial judge’s refusal to allow evidence concerning additional attorneys fees incurred by plaintiff which would not have been incurred by him had defendants not been negligent in failing to timely file suit; and (2) the trial court’s failure to award plaintiff a larger amount of damages.

We reverse, holding that the finding of the jury that plaintiff was not guilty of negligence which was a cause of the accident was manifestly erroneous. The preponderance of the evidence is to the effect that plaintiff could have and should have seen and heard the approaching train and was negligent in crossing the railroad track in the path of the oncoming train. Plaintiff’s contributory negligence would have barred his recovery against the railroad and, consequently, plaintiff has not established any loss in respect to recovery of damages against the railroad by reason of the attorneys’ negligence.

We further hold, however, that plaintiff is entitled to recover the additional cost incurred by him to obtain the legal services which defendants agreed to perform but failed to perform.

Attorney Malpractice — Applicable Law

An attorney is liable to his client for the damages caused to the client by the attorney’s negligence in the handling of the client’s business, provided that the client proves by a preponderance of the evidence that such negligence is the proximate cause of the loss claimed. It is necessary for the client to show that he had a valid claim which has been impaired or lost by the negligence or misconduct of the attorney. When a client sues his attorney for damages because of the mishandling of litigation, the client must, in order to recover, prove that, except for the negligence of the attorney, the litigation would have resulted in a decision favorable to the client. Tassin v. Labranche, 365 So.2d 31 (La.App. 4th Cir. 1978); Vessel v. St Paul Fire & Marine Insurance Co., 276 So.2d 874 (La.App. 1st Cir. 1973); Toomer v. Breaux, 146 So.2d 723 (La.App. 3d Cir. 1962).

In this case, plaintiff was required to prove that the attorneys were negligent in allowing his claim against the railroad to prescribe and that, except for that negligence, he would have recovered against the railroad. He was required to establish a valid claim against the railroad, that the railroad was liable to him, and the amount of damages he was entitled to recover from the railroad.

Negligence of the Attorneys

Shortly after the accident which occurred December 8,1972, Tooke visited with plaintiff or his wife at the hospital at the request of a mutual friend. An attorney-client relationship was established and Tooke assisted the wife in handling some insurance forms and the like. When plaintiff was well enough to talk about the accident claim, Tooke discussed the matter with him and it was agreed that he would handle the claim with the assistance of Morneau, who also met with plaintiff. Tooke’s law practice was primarily in the field of real estate and he did not normally handle litigation due to a serious hearing difficulty. Tooke chose Morneau, a young lawyer with prior experience as an insurance adjuster, to be associated with him on the case.

During the summer and fall Morneau investigated the case, making trips to the accident scene, interviewing witnesses, and talking to plaintiff on several occasions. In about October he made a report to Tooke on the investigation and Tooke asked him to prepare a draft of a petition to be filed. Morneau prepared a draft and delivered it to Tooke in November for Tooke’s review. Tooke’s and Morneau’s recollection of the facts which transpired thereafter are conflicting. The last day for filing the suit was Monday, December 10, 1973, since December 8, the anniversary date of the accident, fell on a Saturday. Tooke testified that the petition, which was retyped in his office, was delivered to Morneau for filing on Friday, December 7. His secretary at the time testified it was delivered on an earlier Friday. Morneau testified that as the prescription date approached he called Tooke’s office on numerous occasions but could not reach Tooke. He testified Tooke’s secretary told him the last day to file suit was Wednesday, December 12, which Mor-neau accepted because he had left his entire file with Tooke and did not have the accident date before him. Morneau testified he picked up the petition at Tooke’s office on Tuesday, December 11, got plaintiff to sign the pauper’s affidavit, and took it to the clerk’s office late that afternoon. There was no judge available at that time to sign the forma pauperis order, so the clerk held the petition until the next day, got the order signed, and filed it on Wednesday, December 12.

Within a week or two, Tooke and Mor-neau were contacted by the railroad’s attorney who called their attention to the fact that the suit was filed late and the claim had prescribed. The suit was subsequently dismissed. It was not until June that Tooke and Morneau told plaintiff what had happened, at which time Tooke advised plaintiff to get another lawyer and assured him of his cooperation.

The negligence of both lawyers in failing to file suit timely and in allowing the claim to prescribe is clear. Each had established an attorney-client relationship with the plaintiff, who was relying on each to properly pursue his claim and protect his interests. Each was equally responsible to the plaintiff and each was equally irresponsible in failing to see that the suit was timely filed. As between themselves, neither attorney established that it was the responsibility of the other to see that the petition was filed or that either was justified in relying on the other in this regard. The jury correctly found that both Tooke and Morneau were negligent and that Tooke was not entitled to recover over against Morneau.

Liability of the Railroad

Facts

The accident happened at the Palmetto Street crossing in Plain Dealing, a town in rural northwest Louisiana with a population of about 2,000. Palmetto Street runs east and west and is the main business street of the town, with the business district being located east of the crossing. The St. Louis Southwestern main line track runs north and south. In addition to the main line track there is a passing track east of the main track and a storage track even farther east, making a total of three tracks a motorist must cross. Plaintiff was traveling west at the time of the accident. The train was traveling south. The crossing is marked by electric signals, with flashing red lights and ringing bells. There are some buildings and other structures east of the tracks, extending north of Palmetto Street. Sometimes boxcars are stopped on the storage track.

The crossing is the southernmost of two crossings in Plain Dealing, the northernmost crossing being Highway 2 and being located about 340 feet north of the Palmetto Street crossing. The main line track curves very slightly to the east as it runs to the north.

The signal light on the east side of the crossing is located 15% feet from the storage track. There is a distance of 45 feet between the storage track and the passing track. The main track is 10% feet west of the passing track. The evidence does not disclose the width of the storage and passing tracks, but assuming a width of 6 feet for each there is a distance of 83 feet from the signal light to the main track and a distance of 61.5 feet from the west line of the storage track to the main track.

The diagram, photographs, and testimony in the record establish that at the signal light the vision of a westbound motorist to the north is at least partially obscured by buildings and other structures and by any boxcars parked on the storage track. The same evidence, however, establishes that once a motorist has crossed over the storage track, at a point approximately 55 to 60 feet east of the main track, the motorist’s vision to the north is unobstructed to a point beyond the Highway 2 crossing, the south line of which is 340 feet north of the Palmetto Street crossing.

Plaintiff, who lived in the country near Plain Dealing, arrived in town at approximately 9:00 a. m. He was traveling east on Palmetto Street when he reached the railroad crossing which was the scene of the accident. The signal lights were flashing and bells were ringing. Plaintiff looked to the north and south, up and down the tracks, saw that no train was approaching, and proceeded across the tracks without trouble. He stopped at a store on Palmetto Street approximately a block from the crossing.

Plaintiff was in the store for 15 to 20 minutes, then returned to his truck and headed west on Palmetto toward the crossing. The signal lights were still operating. Plaintiff testified that he stopped or slowed down when he reached the warning signal, but proceeded on across the tracks. He may have glanced down the tracks when he crossed the storage track. There was a boxear parked on the storage track to the north of the crossing. Plaintiff was traveling at 5 to 6 miles per hour, the windows on his truck were rolled up, the heater fan was running, and the windshield wipers were operating. The weather was overcast and it was raining. As plaintiff’s truck crossed the main track it was struck by the train. Plaintiff never saw the train before it hit him.

The train’s engineer testified that the train was traveling between 40 and 45 miles per hour. The railroad-imposed speed limit was 49 miles per hour; there was no statute or town ordinance governing the speed of trains in the vicinity of the accident. The engineer testified that the oscillating engine headlight was on, that the engine bells were ringing and that he began to blow the customary warning whistle at the whistle board before he crossed the northernmost crossing.

The train’s brakeman, seated in the fireman’s seat on the left side of the engine, testified the train was going 49 miles per hour and that the engineer started blowing the whistle a short distance before reaching the Highway 2 crossing. He saw plaintiff’s truck moving slowly across the Palmetto Street crossing and thought it would stop. When he realized it was not going to stop, he shouted to the engineer who threw the brakes into emergency. The engineer, seated on the right side of the engine, did not see the truck until impact.

Two witnesses testified they saw plaintiff approaching and crossing the tracks at a slow rate of speed, but without stopping. Several witnesses testified they heard the train start sounding its whistle as it approached the northernmost or Highway 2 crossing.

Several witnesses testified it was not unusual for the signal lights to malfunction by operating continuously even though there was no train approaching, and verified that such was the situation on the morning of the accident.

Negligence of the Railroad

We find no fault with the jury’s finding of negligence on the part of the railroad which was a contributing cause of the accident. The railroad had a duty to maintain properly operating electric signals on this crossing located on the main street of a small municipality. The malfunctioning of the signals had occurred on previous occasions, to the knowledge of the railroad. The continuous operation of the signals when no train was approaching rendered them ineffective as a warning of an approaching train, particularly to a motorist such as plaintiff who had crossed the track minutes before and was aware that the signal was operating continuously. The effect of the malfunction was to render the Palmetto Street crossing the equivalent of an unsignaled crossing. The accident probably would not have happened if the signal had been working properly and serving its intended purpose as a warning device to alert vehicular traffic of the approach of a train.

Although the speed of the train, which was not regulated by statute or ordinance, may not have been excessive at a properly signaled crossing, it could be viewed as excessive under the conditions prevailing here. The causal connection between the speed of the train and the accident is not that the train if operated at a slower speed could have been stopped in time to avoid the accident (it could not), but is that the motorist would have had more time to observe the train and stop his vehicle.

There is also sufficient evidence to support a finding that the train’s whistle was not sounded until shortly before its approach to the northernmost Highway 2 crossing, less than the 900 feet required by LSA-R.S. 45:561. See Watson v. Illinois Cent Gulf R. R., 355 So.2d 1366 (La.App. 1st Cir. 1978), writ refused 357 So.2d 1168 (La.1978); Bertrand v. Missouri Pacific Railroad Company, 160 So.2d 19 (La.App. 3d Cir. 1964), writ refused 245 La. 1075, 162 So.2d 571 (1964).

The combined factors of the nature of the crossing (located on the main street of a municipality), the malfunctioning signal lights» the speed of the train, and the failure to sound the whistle at the distance required by statute constituted negligence on the part of the railroad which was a legal cause of the accident.

Plaintiff’s Contributory Negligence

A motorist approaching a railroad crossing must use his senses of sight and hearing for possible oncoming trains before traversing the railroad crossing. The motorist has the responsibility of seeing and hearing that which he could have seen and heard, and he is presumed in law to have seen and heard what he could have seen and heard. If the motorist’s view of the right of way is obstructed, he must exercise a higher degree of caution. Hebert v. Missouri P. R. Co., 366 So.2d 608 (La.App. 3d Cir. 1978), writ refused 369 So.2d 153 and 155 (La.1979) and cases cited therein. The motorist is held to the reasonable man standard — he must see and hear that which a reasonable man under like circumstances would have seen and heard.

In the instant case, plaintiff was familiar with the crossing, having passed over it a few minutes prior to the accident and on previous occasions. From his experience a few minutes earlier, he could reasonably believe that the flashing electric signals were not indicating the approach of a train; but he could not reasonably believe they were indicating the track was clear. His duty was to look and listen for an approaching train, to keep his vehicle under such speed and control that he could stop immediately if necessary.

Plaintiff may not have been able to see or hear the train as he approached the flashing electric signal and then the storage track. There was some obstruction of vision to the north. The train would have been north of the Highway 2 crossing at that point and might not yet have sounded its whistle.

Plaintiff’s duty to look and listen did not cease but continued as he passed the signals and the storage track. When he crossed the storage track his vision to the north was unobstructed for more than 400 feet, past the Highway 2 crossing. Given the relative speeds of the train (49 miles per hour) and the truck (5 miles per hour), each was about 6 seconds away from the point of impact, with the train 400+ feet north and the truck 50+ feet east. At this point, plaintiff’s view was unobstructed and, according to several witnesses, the train was sounding its whistle and its headlight was burning. Regardless of weather conditions, plaintiff could have and should have seen and heard the approaching train. At 5 miles per hour, he could have stopped his vehicle almost instantly, at least within 10 feet. His failure to see and hear what he could and should have seen and heard with the exercise of ordinary and reasonable care and his driving his truck across the main line track in the path of the oncoming train was negligence, and was a contributing legal cause of the accident.

In Hebert, supra, the driver of a pickup truck which was struck by a train at a crossing was held to be contributorily negligent where he had a view of 300 feet down the track from a distance of 45 feet from the track, and an unlimited view down the track when he was 20 to 25 feet from the track. The motorist in Glisson v. Missouri Pacific Railroad Co., 246 La. 470, 165 So.2d 289 (1964), from a point 48 feet from the track had a clear view for 380 feet and a partially obstructed view for at least 600 feet down the track, and was held to be contributorily negligent in failing to see an approaching train. In Bertrand, supra, the contributorily negligent driver’s view was blocked by a grain truck parked near the track, but when the driver got within 50 feet of the track he had a clear view of the track for an almost unlimited distance. The driver in Theriot v. Texas & New Orleans Railroad Company, 220 So.2d 563 (La. App. 4th Cir. 1969), writ denied 254 La. 142, 222 So.2d 886 (1969), from a distance of 80 feet from the tracks had an unobstructed view of the tracks for 500 feet, and at 15 feet had an unobstructed view as far as the eye could see. The court held there was no reason the driver could not have seen the train if he had looked, or heard the train if he had listened. In Madere v. Southern Pacific Transportation Co., 383 So.2d 456 (La.App. 4th Cir. 1980), a motorist was held contributorily negligent where, in spite of trees and shrubs, at a distance of 25 to 50 feet from the track he could have seen the train approaching.

Plaintiff contends that he was relieved of taking the usual precautions here because of the “dangerous trap” doctrine enunciated in McFarland v. Illinois Central Railroad Company, 122 So.2d 345 (La.App. 1st Cir. 1960) and other cases. Where a crossing is unusually dangerous because the view of a motorist is so obstructed as to require that he place himself in a position of peril dangerously near the tracks before he has a view of an oncoming train, the railroad company will be held liable unless it takes unusual precautions. The theory of the doctrine is that the railroad may not rely upon the duty of the motorist to stop, look and listen if the physical circumstances are such that taking such precautions will do the motorist no good.

The doctrine is not applicable here. Although plaintiff’s view may have been partially obstructed at the signal light prior to crossing the storage track, his view was unobstructed for a substantial distance to the north after crossing the storage track, at which point he was not in a position of peril, but, on the other hand, had ample time, distance, and opportunity to look, listen and stop.

Plaintiff’s contributory negligence would have barred his recovery against the railroad. Consequently, plaintiff has not established that the negligence of his attorneys caused him any loss. The jury’s finding in this respect was manifestly erroneous and must be reversed.

Plaintiff’s Answer to the Appeal

Recovery of Additional Attorneys Fees Incurred

During the course of the trial of this matter, plaintiff sought to present evidence before the jury of additional attorneys fees which he incurred in this malpractice action and which he would not have incurred in his action against the railroad. More specifically, plaintiff sought to introduce into evidence the fee contract between himself and his present attorneys in which he agreed to pay his attorneys the sum of $5,000 regardless of recovery in this matter, in addition to the normal contingent fees for cases of this nature.

The trial judge refused to allow this evidence to be presented to the jury. Accordingly, at the close of evidence, and outside the presence of the jury, a proffer, or offer of proof, was made of this evidence. The proffer includes the attorneys’ fee contract and a statement by one of the attorneys setting forth the reasons for the additional fee requirement.

Normally, a personal injury claim such as plaintiff had against the railroad is handled strictly on a contingent fee basis. As a matter of fact, Tooke and Morneau had agreed to handle the lawsuit against the railroad on a contingent fee basis of one-third (Vs) of the amount recovered.

Because of complications inherent in the pursuit of plaintiff’s rather stale claim against the railroad through a malpractice action against his former attorneys, counsel retained by plaintiff to handle his case was understandably unwilling to represent him solely on a contingent fee basis. Therefore, they reasonably required, in addition to a contingent fee, that plaintiff pay them $5,000 regardless of the outcome of the litigation.

Tooke and Morneau had agreed to pursue plaintiff’s claim on a contingent fee basis. Under this arrangement, plaintiff would have had his day in court against the railroad on his serious good-faith claim, and would have owed no attorney fee even though unsuccessful. Because of his former attorneys’ negligence in letting the claim prescribe, plaintiff had to retain other counsel and to obligate himself for a $5,000 fee regardless of the outcome. Therefore, plaintiff was required to obligate himself to pay $5,000 to obtain the same legal services which defendants had agreed to furnish simply on a contingent fee basis. The former attorneys’ negligence and failure to furnish the legal services they contracted to perform has caused plaintiff a loss of $5,000 which he would not have sustained except for his former attorneys’ fault and failure to perform.

In Ramp v. St. Paul Fire and Marine Insurance Company, 263 La. 774, 269 So.2d 239 (1972), the Louisiana Supreme Court held in an attorney malpractice case that the plaintiff was entitled to recover from the negligent attorneys the additional attorneys fees that he would not have incurred but for the negligence of the defendant attorneys. The holding of the Ramp case is applicable here. Plaintiff is entitled to recover the loss he has sustained by reason of having to pay attorney fees to indirectly pursue his claim against the railroad, which the defendants had obligated themselves to do without charge except on a contingent basis. The award of this item of loss or damage does not amount to an award of attorney fees incurred in order to pursue the malpractice action as such, but is to compensate for the additional cost, i. e., attorneys fees, incurred by plaintiff in order to have the railroad’s liability to him judicially determined. This is consistent with Ramp, where the attorney fee awarded was not for pursuit of the malpractice suit, but was for the additional fee incurred by the plaintiff to pursue certain inheritance rights which the negligent attorneys had failed to protect.

Plaintiff is entitled to recover this item of loss or damage.

Inadequate Damages

Since we conclude that plaintiff failed to establish that he had a valid claim against the railroad, and, consequently, is not entitled to recovery of damages for his personal injuries sustained in the accident, it is unnecessary to consider plaintiff’s contention that the amount of damages should be increased.

Decree

For the reasons assigned, the judgment of the district court is reversed and set aside. Judgment is rendered in favor of the plaintiff, Jerry Wayne Jenkins, against the defendants, John B. Morneau and his insurer, the St. Paul Fire & Marine Insur-anee Company, and Charles E. Tooke, Jr., in solido, for the sum of $5,000, together with legal interest thereon from October 9, 1974 until paid, and for all costs of these proceedings, including the cost of appeal.

Reversed and rendered.