CANAL/CLAIBORNE, LIMITED v. STONEHEDGE DEVELOPMENT, LLC (Parish of Jefferson)
No. 2014-C-0664
Supreme Court of Louisiana
December 9, 2014
Supreme Court of Louisiana
FOR IMMEDIATE NEWS RELEASE
NEWS RELEASE #232302363
FROM: CLERK OF SUPREME COURT OF LOUISIANA
The Opinions handed down on the 9th day of December, 2014, are as follows:
BY GUIDRY, J.:
2014-C-0664 CANAL/CLAIBORNE, LIMITED V. STONEHEDGE DEVELOPMENT, LLC (Parish of Jefferson)
Accordingly, we conclude the trial court was without subject matter jurisdiction to entertain the plaintiff‘s claim for enrichment without cause and dismiss that claim with prejudice. REVERSED AND REMANDED TO THE DISTRICT.
WEIMER, J., concurs in part and dissents in part.
HUGHES, J., concurs in part and dissents in part for the reasons assigned by Justice Weimer.
12/09/14
SUPREME COURT OF LOUISIANA
No. 2014-C-0664
CANAL/CLAIBORNE, LIMITED
VERSUS
STONEHEDGE DEVELOPMENT, LLC
ON WRIT OF CERTIORARI TO THE COURT OF APPEAL FIFTH CIRCUIT, PARISH OF JEFFERSON
The
FACTS and PROCEDURAL HISTORY
Canal/Claiborne, Limited (hereinafter “Canal/Claiborne“) is the owner of property located at 1661 Canal Street in New Orleans. In January 1995, Canal/Claiborne entered into a lease with Stonehedge Development, L.L.C. (hereinafter “Stonehedge“). Stonehedge, in the business of leasing properties to governmental entities, entered into a sublease in June 1995 with the State of Louisiana, Department of Children and Family Services (hereinafter “Department“). The Department occupied the premises, remitting monthly rent payments of about $53,000.00 to Stonehedge, which in turn remitted monthly payments of about $36,000.00 to Canal/Claiborne until Hurricane Katrina struck the city in 2005.
The premises were significantly damaged, rendering the building uninhabitable. Canal/Claiborne repaired the building and reopened it in November 2005, except those areas occupied by the Department, which had initially not allowed removal of its damaged furniture, supplies, and sensitive files. Canal/Claiborne continued to invoice Stonehedge for the monthly rentals as they accrued. By December 2005, the Department had authorized Canal/Claiborne to clean out the Department‘s property from the first floor, and by March 2006, the Department had removed a major portion of its property on the second floor. The Department made no rental payments from November 2005 until the middle of June 2006, when the Department entered into an emergency procurement lease directly with Canal/Claiborne and began remitting payments to Canal/Claiborne.
Canal/Claiborne filed a petition for sums due under the lease in January 2006, alleging
Eventually the matter proceeded to a bench trial in October 2012 against the Department only, Canal/Claiborne having settled with Stonehedge. In November 2012, the trial court entered judgment in favor of Canal/Claiborne and against the Department, awarding $188,066.24 in damages with legal interest from the date of judicial demand. The judgment did not expressly state a legal theory underlying the Department‘s liability, merely awarding “damages suffered . . . as a result of the . . . occupancy of 1661 Canal Street . . . .”
The court of appeal affirmed the trial court‘s judgment, finding no error in the denial of the Department‘s exception of prematurity under
The Department applied for writs of review in this court and, at the same time, filed a declinatory exception of lack of subject matter jurisdiction and a peremptory exception of prescription. The Department has for the first time in any court raised the issue of subject matter jurisdiction, arguing that Canal/Claiborne has asserted a quasi-contractual unjust enrichment claim against the Department for storing items on Canal/Claiborne‘s property for a certain period of time. The Department asserts that, under
We granted the writ application to determine whether the plaintiff‘s unjust enrichment claim falls within the scope of the
ANALYSIS
Although not raised in the lower courts, we find the Department‘s exception of subject matter jurisdiction is properly raised in this court. Louisiana courts have recognized that such an exception may be raised at any stage of the proceedings, including at the appellate level. Piper v. Olinde Hardware & Supply Co., 288 So.2d 626 (La. 1974); Colaccurcio v. Ledet, 94-1798 (La. App. 4 Cir. 9/28/95), 662 So.2d 65. The jurisdiction of a court over the subject matter of an action or proceeding cannot be conferred by consent of the parties.
Turning to the merits of the exception, we must determine whether the plaintiff‘s alleged quasi-contractual claim of unjust enrichment falls within the scope of the waiver of immunity set forth in
The starting point in the interpretation of constitutional provisions is the language of the Constitution itself. Louisiana Mun. Ass‘n v. State, 00-0374, p. 5 (La. 10/6/00), 773 So.2d 663, 667. When a constitutional provision is plain and unambiguous, and its application does not lead to absurd consequences, its language must be given effect. Id. at pp. 5-6, 773 So.2d at 667. The
In this case, the plaintiff‘s claim against the Department is in part, at least, one for enrichment without cause, see
Nor do we find any merit to Canal/Claiborne‘s assertion that it was a third-party beneficiary of the sublease between Stonehedge and the Department and, therefore, the Department is liable in contract to Canal/Claiborne. Under a stipulation pour autrui, a contracting party may stipulate a benefit for a third person, who must then manifest an intention to avail himself of the benefit.
We conclude that Canal/Claiborne has failed to identify a claim against the Department sounding in contract that would fall within the scope of the waiver of immunity found in
Turning to
The legislature may authorize other suits against the state, a state agency, or a political subdivision. A measure authorizing suit shall waive immunity from suit and liability.
Canal/Claiborne argues that
Whether the power “to sue and be sued” language found in
The 1921 constitutional provision originally vested in the legislature the discretionary power from time to time to consent to suit. In 1946, the provision was amended to address the enforcement of judgments. In 1959, this court construed the provision as it then existed as giving the legislature the power to waive the traditional sovereign immunity from suit, but not the immunity from substantive tort liability, effectively reducing the legislature‘s waiver of immunity to a mere invitation “to visit the courthouse” to file suit and to be thrown out shortly thereafter on an exception of no cause of action. See Duree v. Maryland Casualty Co., 238 La. 166, 114 So.2d 594 (1959); Stephens v. Natchitoches School Board, 238 La. 388, 115 So.2d 793 (1959). This construction prompted a 1960 constitutional amendment to add the liability language to the 1921 Constitution, assuring that any waiver of immunity would be both from suit and from liability. As amended by Act 621 of 1960, Art. III, Sect. 35 of the 1921 Constitution provided in part as follows:
The Legislature is empowered to waive, by special or general laws or resolutions, the immunity from suit and from liability of the state, and of parishes, municipalities, political subdivisions, public boards, institutions, departments, commissions, districts, corporations, agencies and authorities and other public or governmental bodies; and each authorization by the Legislature for suit against the State or other such public body, heretofore and hereafter enacted or granted, shall be construed to be and shall be effective and valid for all purposes, as of and from the date thereof, as a waiver of the defendant‘s immunity both from suit and from liability. The Legislature shall, by special or general laws or resolutions, prescribe the procedural rules, including rules of venue and service of process, to govern suits against the state and other public bodies; the procedure in such suits, in the absence of applicable procedural rules promulgated by the Legislature, to be the same as in suits between private litigants. No judgment against the state or any other public body shall be exigible, payable or paid except out of funds appropriated for payment thereof.
Commenting on the 1960 amendment to Art. III, Sect. 35 of the 1921 Constitution, this court stated in Hamilton v. City of Shreveport, 247 La. 784, 174 So.2d 529, 530 (1965):
[T]he Legislature of 1960 in adopting the aforementioned proposed amendment did so with the express purpose of nullifying the effect of [Duree and Stephens, a pair of] decisions of this court [which held] that whenever the Legislature authorized suit under Section 35 of Article 3 of the Constitution of 1921, as amended pursuant to Act No. 385 of 1946, it simply waived the traditional immunity of the state and its subdivisions from suit and did not constitute a waiver of the state or its agencies from liability for the negligence of one of its employees in the exercise of a governmental function.
In Hamilton, however, the court was faced with the issue of whether the “sue and be
In Herrin v. Perry, 254 La. 933, 228 So.2d 649, this court applied Hamilton to find a general waiver of tort liability, holding that the “‘sue and be sued’ provision in the charter or organic act of any body enumerated in the 1960 amendment to Art. III, Sect. 35 of the 1921 Constitution must be construed as a general waiver of immunity from suit.” 228 So.2d at 656. The Herrin court thus rejected the argument of the Department of Highways that the 1960 amendment to the 1921 Constitution was not intended to cause all prior acts creating governmental agencies and giving them the authority “to sue and be sued” to be considered as general waivers of immunity from tort liability. The Herrin court was not confronted with the scope of the waiver of immunity outside of the tort context.
In Splendour, supra, decided in 1973 while the constitutional convention was under way, this court found that in Louisiana sovereign or governmental immunity was a judicially-created doctrine, which was outmoded and which was inconsistent with the state‘s policy of requiring that state agencies either “act responsibly, or be subject to answer in court.” 273 So.2d at 26. Thus, even in the absence of any legislative authority to “sue and be sued,” this court held that state agencies were not immune from suit in tort, abrogating sovereign immunity in tort cases. Chamberlain, 624 So.2d at 881.
The 1974 Constitution continued the Splendour court‘s broad abrogation of sovereign immunity in tort, and created a similarly broad waiver of immunity for suits in contract; however, the 1974 Constitution notably continued the requirement of legislative pre-authorization for suits other than those in contract or for injury to person or property. The 1974 Constitution, as this court explained in Chamberlain, now contains in
The cases relied upon by the plaintiff do not support its assertion that, when the
Similarly, Willis v. Dept. of Culture, Recreation, and Tourism, 525 So.2d 1162, 1164 (La. App. 2nd Cir. 1988), does not stand for the general waiver proposition asserted by Canal/Claiborne; indeed, the court‘s holding tends to counter that proposition. In Willis, the plaintiff filed a petitory action against the Department of Culture, Recreation, and Tourism, State of Louisiana, alleging that he was the owner of a tract of land in Webster Parish and that the Department had taken possession of a portion of his land by erecting a fence. The Department filed an exception of sovereign immunity asserting the State of Louisiana may not be sued without legislative consent except where the cause of action is in contract or tort in accordance with
Canal/Claiborne lastly cites State ex rel. Dept. of Highways v. City of Pineville, 403 So.2d 49 (La. 1981), arguing that, if a state agency, having the power to sue and be sued, can assert a claim founded on the theory of unjust enrichment, or some other form of quasi-contract, then that agency is surely subject to suit for a quasi-contractual claim. City of Pineville, however, did not address the intent of the meaning of the “power to sue and be sued” language within the context of
Though not cited by the plaintiff, we note the appellate court in St. John the Baptist Parish v. State ex rel. Dept. of Wildlife and Fisheries, 02-612 (La. App. 5 Cir. 10/16/02), 828 So.2d 1229, 1230-1231, ostensibly held the “sue and be sued language” found in the Department of Wildlife and Fisheries statutes,
The appellate court affirmed the trial court‘s denial of the venue exception. The appellate court first found that
Notably, the appellate court in St. John the Baptist Parish was not called upon to determine whether the plaintiffs’ claims fell inside or outside the scope of the waiver of sovereign immunity in contract or for injury to person or property as set forth in
We hold that the “power to sue and be sued” given a state agency by virtue of the statute creating that agency does not by itself effect a general waiver of immunity with regard to all suits within the meaning of
CONCLUSION
To capsulize, we find the plaintiff‘s alleged quasi-contractual claim for unjust enrichment does not fall within the scope of the waiver of sovereign immunity from suit and liability in contract or for injury to person or property found in
REVERSED AND REMANDED TO THE DISTRICT COURT
12/09/14
SUPREME COURT OF LOUISIANA
NO. 2014-C-0664
CANAL/CLAIBORNE, LIMITED
VERSUS
STONEHEDGE DEVELOPMENT, LLC
ON WRIT OF CERTIORARI TO THE COURT OF APPEAL, FIFTH CIRCUIT, PARISH OF JEFFERSON
Weimer, J., concurring in part, dissenting in part.
Under
The majority, however, attempts to restrict the “power to sue and be sued” language of
In its historical narrative, the majority attempts to limit this court‘s decision in Herrin v. Perry, 254 La. 933, 228 So.2d 649 (1969). In Herrin, this court examined the effect of statutory language permitting the state Department of Transportation to “sue and be sued,” and concluded the quoted language constituted a waiver of sovereign immunity. The Herrin court explained that “the ‘sue and be sued’ provision in the charter or organic act of any body enumerated in the 1960 Constitutional Amendment must be construed as a general waiver of immunity from suit.” Herrin 228 So.2d at 656. The limitation the court presently places on Herrin is based on the fact that the “court was not confronted with the scope of the waiver of immunity outside of the tort context.”
The distinction the majority now draws misses the point. The proper focus is on the effect of the legislature‘s choice to waive immunity when it employs the terms “sue and be sued.” The alternative to language that waives immunity for any cause of action, would be to require the legislature to list every conceivable cause of action. Therefore, rather than accept that the legislature intended “sue and be sued” to cover every type of suit, the majority apparently reverts to a requirement that the legislature employ “magic words” to specify the type of suit for which sovereign immunity has been waived. There is a general disfavor in the law to require the use of such “magic words,” and it is unfitting for this court to foist such an encumbrance upon the legislature to list every type of suit for which immunity applies when the simple phrase “any and all suits” plainly suffices. See, e.g., Harrah‘s Bossier City Inv. Co., LLC v. Bridges, 09-1916, p. 17 (La. 5/11/10), 41 So.3d 438, 450 (ruling, in the context of tax exemptions established by the legislature: “There are no ‘magic words’ necessary to create an exemption or an exclusion; the determining factor is the effect of the statute: ‘the words and form used legislatively in granting an exemption are not important if, in their essence, the Legislature creates an exemption.‘“), quoting Wooden v. Louisiana Tax Commission, (La. 2/20/95), 650 So.2d 1157, 1161.
Also downplayed in the majority‘s historical narrative of sovereign immunity is that this court had concluded before Herrin that “sue and be sued” equates to a broad legislative waiver of sovereign immunity. That is, the majority cites Hamilton v. City of Shreveport, 247 La. 784, 174 So.2d 529, 530 (1965), and notes that the legislature‘s use of “sue and be sued” language was at issue. Further, the majority correctly recites that this court ruled that the “sue and be sued” language was ”effective and valid for all purposes . . . a waiver of the defendant‘s immunity from both suit and from liability.” (Emphasis added.) However, the majority attempts to distance itself from the ruling in Hamilton that the waiver was “valid for all purposes.” Canal/Claiborne, Ltd v. Stonehedge Development, LLC, No. 14-0664, slip op. at 11 (La. Dec. ___, 2014).
To place distance between the instant case and Hamilton, the majority notes that Hamilton dealt with a tort suit. At the time Hamilton was decided, however, the constitution lacked the present waiver found in Section 10(A), expressly waiving immunity in contract and tort. Therefore, the only significant point to be drawn from Hamilton is not one of limitation, but rather that this court gave the “sue and be sued” language an expansive meaning: “effective and valid for all purposes.” See Hamilton, 174 So.2d at 530 (emphasis added).
The majority never explains why the broad “sue and be sued” language, which must be assumed to have been deliberately chosen by the legislature,1 is insufficient to serve as a waiver of non-tort/non-contract suits under Section 10(B). Even more instructive than this court‘s ruling in Hamilton are the following principles, which compel the conclusion that the legislature‘s use of “sue and be sued” language reflects a waiver under Section 10(B).
One of the governing principles is found in the Chamberlain opinion, on which the majority relies for its historical narrative. In Chamberlain, 624 So.2d at 879, this court explained: “Unlike the federal constitution which grants powers, the Louisiana constitution, in general, limits powers. Polk v. Edwards, 1993 WL 364714, n.4 (La. 1993) (No. 93-CA-0362) (noting that ‘state constitutions typically contain limits on governmental authority rather than grants of power as with the federal constitution‘).” Under this principle, unless restricted by the constitution, the legislature is free to waive immunity for all causes of action.
Another longstanding principle indicates that we are to look for a restriction in the constitution by using “the same general rules used in interpreting laws and written instruments.” East Baton Rouge Parish School Bd. v. Foster, 02-2799, pp. 16-17 (La.6/6/03), 851 So.2d 985, 996, citing Caddo-Shreveport Sales And Use Tax Commission v. Office of Motor Vehicles, Dept. of Public Safety and Corrections, 97-2233, p. 6 (La. 4/14/98), 710 So.2d 776, 780,
Under these principles, this court is tasked with examining Section 10(B) for indicators that “sue and be sued” is insufficient to waive immunity for non-tort/non-contract suits.
Nothing in the language of
By presently failing to give effect to the plain and broad designation of the Department as “a body corporate with the power to sue and be sued,” the majority effectively perpetuates a flawed policy. That is, the majority is rightly critical of the line of cases under the former constitution, holding that the legislature‘s waiver of immunity was a “mere invitation ‘to visit the courthouse’ to file suit and to be thrown out shortly thereafter on an exception of no cause of action. See Duree v. Maryland Casualty Co., 238 La. 166, 114 So.2d 594 (1959); Stephens v. Natchitoches School Board, 238 La. 388, 115 So.2d 793 (1959).” Canal/Claiborne, No. 14-0664, slip op. at 10. The Duree and Stephens cases essentially put litigants in the position of having a right, but no remedy. Similarly, the majority‘s present refusal to recognize the “sue and be sued” language as a waiver for the plaintiff‘s quasi-contractual suit contravenes the notion that if a state agency enters a private marketplace, the agency should be held accountable just as a non-governmental entity would be accountable. Cf. Williams v. State, Dept. of Health and Hospitals, 97-0055, pp. 6-7 (La. 12/2/97), 703 So.2d 579, 583 (commenting on the treatment of sovereign immunity under the current state constitution, this court explained: “the abrogation of sovereign immunity necessitates the application of the law of the land equally to the sovereign and the private litigant.“).
The majority‘s new, restrictive interpretation begs an important question. If, as the majority holds, the language “sue and be sued” provides limited authority to a litigant to recover against the state‘s Department of Children and Family Services, is it consistent for “sue and be sued” to nevertheless suffice to authorize the Department of Children and Family Services to recover against a litigant? Pursuant to
Reading the phrase “sue and be sued” to mean that the legislature has authorized and waived immunity for tort, contract, and all other causes of action is supported by a plain reading of that phrase. That meaning harmonizes the agency‘s statutory duty to file a wide range of non-contract/non-tort suits under
In a related vein, because the decision in St. John the Baptist Parish v. State ex rel. Dept. of Wildlife and Fisheries, 02-612 (La.App. 5 Cir. 10/16/02), 828 So.2d 1229, 1230-31, can be interpreted to broadly hold “sue and be sued” language constitutes a general waiver of immunity in an action challenging the Department of Wildlife and Fisheries’ ability to enforce its camping regulations (an action which is not grounded in contract or tort), I find that the St. John the Baptist Parish court ruled properly. Unlike the majority here, I would not overrule any portion of St. John the Baptist Parish.
In conclusion, I respectfully dissent from the majority‘s ruling, inasmuch as that ruling does not construe the phrase “sue and be sued” as a waiver of immunity to the plaintiff‘s quasi-contractual claims and redefines that phrase, which this court had previously held was “effective and valid for all purposes,” as a waiver of sovereign immunity. See Hamilton, supra (emphasis added).
Notes
The Legislature is empowered to waive, by special or general laws or resolutions, the immunity from suit and from liability of the state, and of parishes, municipalities, political subdivisions, public boards, institutions, departments, commissions, districts, corporations, agencies and authorities and other public or governmental bodies; and each authorization by the Legislature for suit against the State or other such public body, heretofore and hereafter enacted or granted, shall be construed to be and shall be effective and valid for all purposes, as of and from the date thereof, as a waiver of the defendant‘s immunity both from suit and from liability.