Quality Design & Construction, Inc. v. City of Gonzales
146 So. 3d 567
La. Ct. App.2014Background
- QDC contracted with the City of Gonzales to build a municipal "spray-ground"; contract price increased by change orders to $407,487.24. The project was certified substantially complete on July 30, 2004.
- Trial court awarded QDC a judgment on March 9, 2006 for the retained/withheld sum of $54,000 minus $2,800 liquidated damages, leaving $51,200; trial court denied attorney fees and reserved the City's warranty/defect counterclaims as a separate action.
- On appeal this court affirmed the $51,200 judgment, reversed on attorney fees, and amended to award legal interest on $54,000 from July 30, 2004 to substantial completion; that judgment became final when not appealed further.
- Despite the final judgment, the City made no payment; QDC sought a writ of mandamus under La. R.S. 38:2191(D) to compel payment of the $51,200, plus interest, attorney fees, and costs.
- Trial court granted a peremptory writ on January 3, 2013 ordering the Mayor to pay $51,200; both parties appealed — City arguing mandamus was improper, QDC arguing mandamus should include interest.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether mandamus under La. R.S. 38:2191(D) may compel payment of contract balance from appropriation for the contract | QDC: Statute authorizes mandamus to compel payment of sums due under the contract up to the appropriation for the award and execution of the contract; mandamus appropriate because City refused to pay final judgment | City: Statute should be read to limit mandamus to funds still available and appropriated to the overall project; City had spent appropriated funds on corrective contractors; withholding was not "arbitrary and without reasonable cause" due to pending warranty/defect claims | Court: Statute unambiguously refers to appropriation for the award and execution of the contract (i.e., the contractor's contract). City's spending of appropriated funds on others violates the statute; withholding was not justified by separate warranty suit. Mandamus to compel $51,200 affirmed. |
| Whether mandamus relief is barred unless appropriated funds remain unexpended | QDC: No requirement in statute that appropriated funds remain available; appropriation is for the award and execution of the contract and supports mandamus even if funds were spent improperly | City: Mandamus should be conditioned on remaining appropriated funds; otherwise mandamus would improperly compel expenditure beyond available project funds | Court: Statute does not condition mandamus on funds remaining; City’s diversion of appropriated funds does not preclude mandamus. |
| Whether withholding payment was "arbitrary and without reasonable cause" under § 38:2191(D) | QDC: The prior judgment fixed the amount due; warranty claims were reserved as separate action and do not justify withholding payment | City: Pending warranty/defect claims justify withholding and possible setoff until those claims resolved | Court: The warranty/defect claims are a separate action; they do not excuse nonpayment under § 38:2191(D). Withholding was not reasonable; mandamus appropriate. |
| Whether mandamus order must include interest on the amount ordered | QDC: Interest is part of the "sums due under the contract" and is mandatory under La. C.C.P. art. 1921; prior appellate decision awarded interest from July 30, 2004 | City: Repeats argument that interest recovery depends on availability of appropriated funds; otherwise mandamus cannot compel interest payment | Court: Agreed with QDC — mandamus judgment amended to include legal interest on $51,200 from July 30, 2004 until paid. (Dissent would permit judgment for principal by mandamus but not compel payment of interest by mandamus.) |
Key Cases Cited
- Newman Marchive Partnership, Inc. v. City of Shreveport, 979 So.2d 1262 (La. 2008) (de novo review applies to statutory interpretation questions)
- Livingston Parish Council on Aging v. Graves, 105 So.3d 683 (La. 2012) (court’s role in ascertaining legislative intent in statutory construction)
- Thomas B. Catchings & Associates v. City of Baton Rouge, 621 So.2d 767 (La. 1993) (legal interest awarded on amounts owed under public contract from date of default)
- Catahoula Parish School Bd. v. Louisiana Machinery Rentals, LLC, 124 So.3d 1065 (La. 2013) (legislature presumed to act with knowledge of statutory construction principles)
- In re Succession of Boyter, 756 So.2d 1122 (La. 2000) (rules of statutory construction and search for legislative intent)