Hostetler v. W. Gray & Co., Inc.Hostetler v. W. Gray & Co., Inc.
The plaintiffs appeal the trial court‘s judgment rejecting their demands for the rescission of the sale of the lakefront lot that they bought and for nonpecuniary damages. We reverse in part, amend in part, affirm in part and render.
In March 1986, the plaintiffs filed suit against W. Gray & Company, Inc., the vendor of the lot, and Coyle Engineering Company, Inc., the surveyor who replatted the subdivision. The plaintiffs asked for rescission, damages and attorney‘s fees. The defendants filed a general denial, and Gray filed a third party demand against Coyle. The defendants filed amended answers alleging that the plaintiffs were contributorily negligent.
The trial court denied the plaintiffs’ request for rescission and nonpecuniary damages, but determined that plaintiffs had been damaged in the amount of $26,000, representing a reduction of the purchase price, plus $5,000 in attorney‘s fees. The court reduced these amounts by twenty-five percent due to the fault of the plaintiffs and rendered judgment in the amounts of $19,500 and $3,750, respectively.
In addition, the trial court entered judgment in favor of Gray and against Coyle for indemnification of the above amounts, less twenty percent for Gray‘s fault.
Only the plaintiffs have appealed, asking for the rescission of the sale of the lot, damages of $139,000 for the value of the house they built thereon, nonpecuniary damages in the amount of $30,000, and additional attorney‘s fees of $5,000.
FACTS
In 1984, James Hostetler and his wife, Elizabeth, purchased a lot which was located in Smithland Estates Subdivision on Cypress Lake in Bossier Parish for $29,000. The developer of the subdivision was W. Gray & Company, Inc. Prior to the purchase, the plaintiffs were provided with a subdivision plat prepared by defendant Coyle Engineering Company, Inc. for Gray. The plat showed a flowage easement going across the lower portion of their lot. The flowage easement is the line above which the Cypress-Black Bayou Lake Commission cannot raise the lake.
In 1980, Coyle had prepared the original plat which showed the natural drainage running through the middle of one or more lots. Gray asked Coyle to replat the subdivision so that the drainage would not be in the middle of the lots. Gray also asked Coyle to show the flowage easement on the replat. In platting the flowage easement, Coyle relied upon a prior topographical survey which Gray provided. On that topographical survey was the following statement: “I hereby certify that is [sic] topographical survey is true and suitably accurate
On the replat, Mr. Coyle put the following note: “This property is subject to a flowage easement to the 187.5 M.S.L. contour shown approximately hereon.” (Emphasis added.) The replat was recorded in the public records of Bossier Parish. It was this replat that was given to the plaintiffs.
Prior to building their house, plaintiffs submitted their plans to the architectural control committee. Mr. Gray, on behalf of the committee, approved the plans. According to the declaration of covenants, conditions and restrictions for lots six through twenty-eight of the replat of Smithland Estates Subdivision, Unit No. 1, Bossier Parish, Louisiana, no structure could be erected on the lot until the structure plans showing the location of the proposed structure is approved by the architectural control committee. In a letter to the plaintiffs, Mr. Gray approved the house plans. At trial, Mr. Gray emphasized that he approved only the plaintiffs’ house plans since the plans submitted by the plaintiffs did not show the location of the proposed house on the lot. The plaintiffs planned to construct most of their house on an area of the lot below the flowage easement.
Ron Hutchison, Gray‘s realtor, advised the plaintiffs in his land appraisal report that a slightly elevated foundation would be required. Bill Gouge, the plaintiffs’ builder and the person that the plaintiffs understood to be Gray‘s property manager, suggested that all they needed to do was to build the house pad up approximately two feet in order to get the entire house above the flowage easement as shown on the replat.
As the plaintiffs were finishing the house, their next-door neighbor had Coyle prepare another survey. The new survey showed that the flowage easement on the survey provided to the plaintiffs was incorrect. The easement line was actually 125 horizontal feet from the erroneous easement line on the replat. The flowage easement is 187.5 feet mean sea level (M.S.L.). The plaintiffs’ expert, James L. White, a registered surveyor, testified that the floor of the house is 186.03 feet M.S.L. Coyle testified that the floor of the house is 186.16 feet M.S.L. Thus, the plaintiffs’ entire house is 1.34 to 1.47 vertical feet below the flowage easement.
SPECIFICATION OF ERRORS
The plaintiffs assign the following as errors:
(1) The trial court erred in failing to rescind the sale and award damages.
(2) The trial court erred in failing to make an award to plaintiffs for general damages including mental anguish and moral damages.
(3) The trial court erred in failing to consider evidence concerning flooding of the interior of the house.
(4) The trial court erred in finding that the plaintiffs were twenty-five percent at fault.
RESCISSION
Rather than ordering a rescission of the sale of the lot, the trial court chose to award a reduction in the purchase price. The plaintiffs argue that the trial court erred in failing to rescind the sale.
In a redhibitory action, the judge has the discretion to award a reduction in the purchase price where he finds that the defect in the thing has merely diminished the value of the thing purchased and has not rendered the thing sold useless or totally unsuited to its purpose.
The trial court in the present case was very impressed with the testimony of the defendant‘s expert, Robin Beck. Mr. Beck, a real estate appraiser in northwest Louisiana, testified that the house and the lot had diminished in value by a maximum of twenty percent. His appraisal was based on his opinion that flood insurance was available and that some types of financing would be available, though V.A. and F.H.A. loans
The factual determination of whether rescission or reduction is appropriate will not be disturbed on appeal unless there is a showing of manifest error. Arceneaux v. Domingue, 365 So.2d 1330 (La.1978), on remand, 370 So.2d 1262, writ denied, 374 So.2d 660 (La.1979); Fogal v. Boudreaux, 497 So.2d 366 (La.App. 3rd Cir.1986). However, we find that the trial court was manifestly erroneous in awarding a reduction of the purchase price, rather than a rescission.
Redhibition is the avoidance of a sale because of some vice or defect in the thing sold which renders it either unfit for its intended use or its use so inconvenient or imperfect that the buyer would not have purchased it had he known of the vice.
The plaintiffs’ lot is burdened with a flowage easement or servitude. A servitude that is established in favor of immovable property, as a flowage easement is, is a predial servitude. Ogden v. Bankston, 398 So.2d 1037 (La.1981). “The very essence of a predial servitude is that the dominant estate has a right to do something which may limit the use of the servient estate.” Dautreuil v. Degeyter, 436 So.2d 614, 618 (La.App. 3rd Cir.1983). The owner of the servient estate can do nothing to diminish the use of the servitude.
As the owner of the dominant estate, the Cypress-Black Bayou Lake Commission has the right to raise the lake to 187.5 feet mean sea level, and the plaintiffs as the owners of the servient estate cannot stop that action. If the lake is raised to this level, the plaintiffs’ house will be flooded. Even though Larry Deen, the executive secretary of Cypress-Black Bayou Lake Commission, testified that the commission has no plans to raise the lake now or in the future, the fact remains that the commission has the absolute right to raise the lake.
The evidence reveals that the extensiveness of the flowage easement renders the lot absolutely useless for residential purposes or, at the very least, so inconvenient and imperfect that the plaintiffs would not have purchased it if they had known of the true location of the easement. The flowage easement covers almost the entire lot. The only portion of the lot on which the plaintiffs could have built their house without encroaching on the easement is between the easement and the twenty-five foot building set back. Thus, the flowage easement made the lot totally useless for its intended purpose.
In addition, the plaintiffs testified that they would not have bought the lot had they known of the true location of the easement. One of the reasons for their refusal to purchase the adjacent lot was the fact that most of that lot, according to the replat, was covered by the flowage easement. Therefore, the plaintiffs are entitled to a rescission of the sale of the lot and return of the purchase price of $29,000.
Under
The evidence reflects that the plaintiffs paid $29,000 for the lot and they paid $74,400 for the construction of their house. However, as we will detail more extensively later in this opinion, all of the work to clear the lot and a great deal of the finishing work on the house was done by the plaintiffs themselves. The property is therefore more valuable than the sum of the price of the lot and the amount paid for the construction of the house. This fact is made apparent by the $139,000 appraisal submitted by plaintiffs’ expert and the $130,000 appraisal submitted by the defendants’ expert. (Both appraisals assumed that the easement at issue did not exist.) The trial judge, in assessing the award of damages herein, specifically indicated that in his view the opinion of the defendants’ appraiser was the better one. For that reason, we will accept the value assigned by defendants’ appraiser to the house and lot and award plaintiffs that figure, $130,000, representing the cost of the lot and the value of the house.
NONPECUNIARY DAMAGES
The plaintiffs have also sought nonpecuniary damages for the mental anguish attendant to their situation. The pertinent articles on nonpecuniary damages are found in the section of the Civil Code dealing with obligations. The obligations articles were recently revised, becoming effective on January 1, 1985. The law in existence when a contract is made becomes a part of that contract as though expressly written into the agreement. Johnson v. Anderson-Dunham Concrete Co., 212 La. 276, 31 So.2d 797 (1947); Dantoni v. Board of Levee Commissioners of Orleans Levee District, 227 La. 575, 80 So.2d 81 (1955); White v. Crook, 426 So.2d 334 (La.App. 2d Cir.1983); West v. State, Through State Superintendent of Public Education, 324 So.2d 579 (La.App. 1st Cir.1975). The contract of sale in this case was perfected in March of 1984; therefore, the former obligations articles apply in this case.2
In order to be able to recover nonpecuniary damages under
The leading case on
Where an object, or the exclusive object, of a contract, is physical gratification (or anything other than intellectual gratification) nonpecuniary damages as a consequence of nonfulfillment of that object are not recoverable.
Importantly, the Supreme Court also stated that it “has never adopted a strict view but has reached results favoring the broader interpretation of Art. 1934(3),” Meador, supra at 435 (footnote omitted). The Supreme Court also noted in Meador that
Recently, in Lafleur v. John Deere Company, 491 So.2d 624 (La.1986), a redhibition suit involving a farming implement necessary to plant a soy bean crop, the court was faced with determining whether a substantial jury award for mental anguish should be allowed to stand. Although the court repudiated the award, it affirmed the viability of Meador to the effect that nonpecuniary damages are available under
Considering
We determine that in the instant case the contract clearly had as its principal object the gratification of an intellectual interest and that the defendant obligor knew or should have known the failure of his product would cause a loss of that interest.
Having lived in a trailer prior to building this house, the plaintiffs were looking forward to fulfilling their dream of having a special house as a home. Their natural excitement about owning this house was heightened by the fact that it was to be located on a lot having a scenic view of the lake. As the photographs and testimony establish, the plaintiffs put much of themselves into this project from the very beginning. In their purchase of the lot, they were not motivated by pecuniary gain or even status. Instead, their reason for purchasing this lot was to build a house that would reflect their taste and that would provide them with the personal comfort that only a house located on a lake can provide. Aesthetics was an important aspect of their choice. The photographs in evidence confirm the beauty of plaintiffs’ home and its setting.
These photographs also show that the lot was thickly wooded when the plaintiffs purchased it. The plaintiffs cleared the lot with the aid of a chainsaw and a large backhoe borrowed from Mrs. Hostetler‘s father. Clearing the lot entailed removing the numerous stumps and burning the brush removed from the lot. They labored on this project for almost a year and a half. Photographs taken after the clearing had been completed reflect the beauty of the lot itself and the sweeping view of the lake therefrom.
Thus, plaintiffs’ objective of purchasing a unique lot for the erection of a beautiful home with a broad view of the lake has been frustrated because of the defective lot. The home upon which they lavished considerable time, effort and love will be flooded if the lake commission decides to raise the lake. We will award plaintiffs $7,500 in damages for their loss in this respect.5
The plaintiffs also assert that they are entitled to additional attorney‘s fees of $5,000 because of this appeal. The trial court awarded them attorney‘s fees in the amount of $5,000. Because of the complexity of this case and the substantial increase in the plaintiffs’ award, we find that the plaintiffs are entitled to additional attorney‘s fees in the amount of $2,500, for a total of $7,500.
COYLE‘S LIABILITY
The plaintiffs sued Coyle Engineering Company, Inc., the surveyor, in redhibition and in tort. There can be no redhibitory action in the absence of a vendor-vendee relationship. Davis v. Davis, 353 So.2d 1060 (La.App. 2d Cir.1977), writ denied, 355 So.2d 549 (La.1978). We, therefore, find that the plaintiffs’ remedy against Coyle is in damages for negligence.6
At Mr. Gray‘s request, Mr. Charles G. Coyle, president of Coyle Engineering Company, Inc., prepared the replat showing the flowage easement. Mr. Coyle testified that he did not survey the property to locate the easement. Instead, he relied on a topographical survey supplied by Mr. Gray to place the easement. It is undisputed that printed on this topographical survey is a caveat that the survey was suitable for ”preliminary planning purposes” (emphasis added). It is also undisputed that this topographical survey was in error as to the location of the flowage easement. As a result, Mr. Coyle put the flowage easement in the wrong place on the replat. Mr. Coyle testified that after he had discovered that the easement was incorrectly located on the lot belonging to the plaintiffs’ neighbor, he admitted to the Cypress-Black Bayou Lake Commission that he had made a mistake in mapping out the flowage easement.
The trial court found that Coyle was negligent in its preparation of the replat and thus was liable to the plaintiffs for their damages.
Surveyors are expected to perform with the same degree of care and skill exercised by others in the profession in the same general area. Crawford v. Gray and Associates, 493 So.2d 734 (La.App. 2d Cir. 1986), writs denied, 497 So.2d 1012 (La. 1986) and 497 So.2d 1013 (La.1986); Lawyers Title Insurance Company v. Carey Hodges and Associates, Inc., 358 So.2d 964 (La.App. 1st Cir.1978). James White, a registered surveyor called by the plaintiffs, testified that it was his opinion that in the Shreveport/Bossier area, it was not good engineering practice to prepare the final subdivision plat setting forth the flowage easement without taking field measurements and to rely instead on a topographical survey made for preliminary planning purposes.
It is undisputed that Coyle placed the flowage easement in the wrong place on the replat. That the plaintiffs’ house is below the flowage easement is also undisputed. There is no question that Coyle‘s action was a cause in fact of the plaintiffs’ damages. Except for the erroneous placement of the easement, the plaintiffs would not have bought the lot and built a house thereon.
Coyle knew at the time that the replat was prepared that it would be filed in the public records and that prospective purchasers of lots in the subdivision would rely upon the replat. The company owed a duty to the prospective purchasers and the actual purchasers, the plaintiffs, to exercise the degree of care and skill required of surveyors in the area. We agree with the trial court that Coyle failed to exercise this degree of care. We find that Coyle breached its duty to the plaintiffs when it determined the location of the flowage easement by relying on a topographical survey which certified that it was for preliminary planning purposes. That breach, then, was a direct cause of the purchase of the defective lot and the erection of the house thereon, as well as the resulting mental anguish suffered by the plaintiffs.
Thus, plaintiffs should likewise receive judgment against the defendant Coyle Engineering Company, Inc. in solido in the amount of $137,500.7
COMPARATIVE NEGLIGENCE
The trial court applied comparative negligence and reduced the plaintiffs’ recovery by twenty-five percent. Comparative negligence is not a defense in a redhibition suit. A redhibition suit is a contractual action. Comparative negligence may only be asserted in a tort action.
In addition, the trial court‘s finding of fault is inconsistent with its finding of a redhibitory defect. In its written reasons for judgment, the trial court implied that because the replat noted that the location of the easement line was approximate, the plaintiffs should have made an effort to find the actual flowage easement line. The court is saying that the erroneous placement of the easement line is a defect that the plaintiffs should have discovered. If they should have discovered the defect, however, then it is not a redhibitory defect.
However, it is necessary that we consider the possible fault on the part of the plaintiffs since the doctrine of comparative negligence is applicable to their negligence suit against Coyle. We find that the plaintiffs were not at fault in failing to obtain another survey.8 Although the survey relied upon noted that the location of the flowage easement as shown on the replat was approximate, the plaintiffs were not put on notice that the easement was 125 feet from its location on the replat. “Approximate” means “nearly correct or exact.” Webster‘s New Collegiate Dictionary, 56 (1981). They did not fail to exercise due care by not getting another survey done. They were justified in interpreting the word “approximate” to mean that the flowage easement was within a few feet of its location on the replat.
We therefore determine that the trial court erroneously reduced plaintiffs’ recovery against each of the defendants. For the reasons aforesaid, it will be necessary that the judgment be amended in this respect.
CONCLUSION
In summary, we have determined that the trial judge erred in decreeing a reduction in the purchase price as we have concluded that the easement at issue covering virtually the entire lot renders the lot useless for the purpose intended and entitles plaintiffs to rescission of the sale. Plaintiffs are thus entitled to a return of the purchase price of the lot along with the value of the house as damages in the total sum of $130,000. We have further determined that the trial court erred in reducing the judgment against Gray on the basis of comparative negligence since the award is in redhibition, a contractual concept. We have further determined that the trial court erred in reducing the award against Coyle because the plaintiffs were not comparatively negligent. We have further determined that the plaintiffs are entitled to an award of $7,500 representing mental anguish, which award is available against the defendant Gray as nonpecuniary damages in redhibition and against the defendant Coyle as an item of damages in tort. We have further determined that plaintiffs are entitled to an increase in their award for attorney‘s fees based upon their redhibitory action against the defendant Gray from $5,000 to $7,500. Of course, the defendant ultimately satisfying the award herein is entitled to title to the lot and improvements thereon.
Our conclusions preclude the need to consider plaintiffs’ assignment of error complaining of the trial court‘s failure to consider the certain evidence of the flooding of the house.
The judgment of the trial court will therefore be reversed and amended in the foregoing respects. While the defendants have sought some relief by brief, neither has answered or appealed the remaining aspects of the judgment and those remaining aspects will therefore be affirmed. The trial court judgment is therefore recast as follows.
DECREE
Premises considered,
IT IS ORDERED, ADJUDGED AND DECREED that there be judgment herein in the amount of ONE HUNDRED THIRTY-SEVEN
IT IS FURTHER ORDERED, ADJUDGED AND DECREED that there be additional judgment herein for attorney‘s fees in the amount of SEVEN THOUSAND FIVE HUNDRED and No/100 ($7,500) DOLLARS plus judicial interest thereon from March 24, 1986 against W. GRAY & COMPANY, INC. and for JAMES ARTHUR HOSTETLER and ELIZABETH LOUISE MARTIN McALISTER HOSTETLER.
IT IS FURTHER ORDERED, ADJUDGED AND DECREED that the remaining two paragraphs of the trial court judgment concerning the third party demand of W. GRAY & COMPANY, INC. against COYLE ENGINEERING COMPANY, INC. regarding fees and costs are affirmed as written.
IT IS FURTHER ORDERED, ADJUDGED AND DECREED that plaintiffs render a deed conveying the lot and improvements thereon at issue herein to the defendant ultimately satisfying the award free and clear of all liens and encumbrances.
All costs are assessed to the defendants.
REVERSED IN PART, AMENDED IN PART, AFFIRMED IN PART, and RENDERED.
ON APPLICATION FOR REHEARING
Before JASPER E. JONES, SEXTON, LINDSAY, FRED W. JONES, Jr., and NORRIS, JJ.
Rehearing denied.