Driver Pipeline Co. v. Cadeville Gas Storage, LLC
150 So. 3d 492
La. Ct. App.2014Background
- Driver and Cadeville contract for Driver to construct pipelines for a storage facility; Cadeville to furnish materials and permits; completion deadlines February 2013; Driver delayed due to Cadeville’s material, permit, and related issues; Driver submitted change orders totaling over $3 million; Cadeville refused and later dispute led to suit May 31, 2013; Cadeville filed reconventional demand; partial summary judgment dismissed Change Orders 17–27; on appeal, Louisiana intermediate court reversed and remanded; underlying issue is whether oral/silence modifications to a written contract could override the written-change-order requirement; discovery disputes complicated proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the trial court correctly granted partial summary judgment on change orders 17–27 | Driver contends genuine issues of material fact exist about necessity and approval of change orders. | Cadeville argues contract required written change orders and that Driver ignored prior approvals. | No; the court held there were genuine issues of material fact and the trial court erred in granting summary judgment. |
| Whether the contract’s modification clause barred oral or implied modifications | Driver asserts the contract may be modified orally or by conduct despite an integration clause. | Cadeville contends the integration clause precludes any modification not in writing. | The court held that contract modification can occur orally or by silence/inaction despite an integration clause, and that summary judgment was improper. |
| Whether there was an oral modification or implied modification of the contract | Evidence suggested parties paid for unapproved work and emails referenced modified responsibility. | Cadeville relies on written terms and integration clause to deny modification. | There are genuine issues of material fact as to whether an oral or implied modification occurred. |
| Whether modification law from other jurisdictions/contexts applies to construction contracts | Established Louisiana jurisprudence allows oral modifications to written contracts; this should apply here. | Some cited authorities rely on contexts (e.g., LMVSFA) or stand for limited propositions. | Louisiana law permits oral or implied modifications to written construction contracts; trial court erred in rejecting them. |
Key Cases Cited
- Rhodes Steel Bldgs., Inc. v. Walker Const. Co., 813 So.2d 1171 (La.App.2d Cir.2002) (oral modification may occur despite writing requirement)
- Salley v. Louviere, 162 So. 811 (La. 1935) (parol evidence not allowed to vary written contract but may show subsequent modification)
- Wisinger v. Casten, 550 So.2d 685 (La.App.2d Cir.1989) (written contract can be modified by oral agreement and conduct)
- Pelican Elec. Contractors v. Neumeyer, 419 So.2d 1 (La.App.4th Cir.1982) (modification by conduct or oral agreement possible when contract is silent on method)
- Amitech U.S.A., Ltd. v. Nottingham Const. Co., 57 So.3d 1043 (La.App.1st Cir.2010) (modification by oral agreement or conduct permissible in construction contracts)