Bayou Fleet, Inc. v. Bollinger Shipyards, Inc.

Citations: 197 So. 3d 797; 2015 La.App. 4 Cir. 0487; 2016 La. App. LEXIS 1418; 2016 WL 3959214Docket: Nos. 2015-CA-0487, 2015-CA-0702

Court: Louisiana Court of Appeal; July 21, 2016; Louisiana; State Appellate Court

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An appeal was filed by Bayou Fleet, Inc. against Bollinger Shipyards, Inc. and Bollinger Gulf Repair, L.L.C., following a December 18, 2014 final judgment that dismissed Bayou Fleet's wrongful conversion claim for the crane boom on the basis of prescription. The judgment also dismissed Bollinger's reconventional demand for storage fees against Bayou Fleet. Bayou Fleet later appealed a June 10, 2015 judgment that taxed costs against them amounting to $19,794.50, while Bollinger sought an increase in those costs. The court affirmed the December judgment but reduced the June judgment by $511.53, denied Bollinger's request for increased costs, and vacated the $11,754.41 reimbursement for expert fees, remanding for an evidentiary hearing on that issue.

The case stemmed from the scrapping of a crane boom left at a shipyard leased by American Marine Corporation (AMC) in the 1960s, which had gone through multiple ownerships before Bollinger took over in 2000. The boom, owned by Cajun Crane Co., was left at the site for over 15 years, and after Hurricane Katrina, Bollinger cleared the site, cutting the boom into pieces for scrap without notifying Bayou Fleet, which claimed ownership and alleged the destruction occurred without their consent. Bayou Fleet filed a Petition for Damages in 2009, seeking the boom's replacement value, asserting they were unaware of the destruction until July 2008.

On April 8, 2009, Bollinger initiated a Reconventional Demand against Bayou Fleet, claiming entitlement to storage fees for a boom on leased property if Bayou Fleet was the owner. In February 2011, Bollinger filed an Exception of Prescription, arguing that Bayou Fleet's conversion claim was time-barred since the boom was allegedly destroyed in November 2007, and the lawsuit was not filed until March 16, 2009. Bayou Fleet countered that discovery revealed the boom likely existed in 2008, suggesting it had not been destroyed until after March 15, 2008, which was less than a year before filing. The trial court denied Bollinger's Exception on January 20, 2012. Following a seven-day bench trial, the court issued a final judgment on December 18, 2014, ruling against Bayou Fleet and dismissing its conversion claim with prejudice, while also dismissing Bollinger’s reconventional demand. The trial court found that Bayou Fleet's conversion claim was indeed prescribed and that Bollinger was not entitled to storage fees due to lack of evidence of ownership. Subsequently, on June 10, 2015, the court ordered Bayou Fleet to reimburse Bollinger $19,794.50 in costs but denied an additional $29,866.61 request. The case led to consolidated appeals. 

The standard of review for prescription claims raised by peremptory exception, with evidence presented, is the manifestly erroneous or clearly wrong standard. The trial court’s findings, particularly those based on witness credibility, are given significant deference, and a reviewing court may not overturn reasonable findings even if it might have assessed the evidence differently.

The trial court instructed both Bayou Fleet and Bollinger to submit their proposed judgments, findings of fact, and conclusions of law by December 10, 2014, which they did without opposition. Bayou Fleet contends that the trial court should scrutinize Bollinger’s proposed findings, claiming they are self-serving and adopted verbatim by the court. However, legal precedent allows courts to adopt a party's proposed findings if supported by the record. The court found no error in adopting Bollinger’s findings.

The court then addressed the issue of prescription regarding Bayou Fleet's claims. Bayou Fleet argued that the trial court's prior denial of Bollinger’s pre-trial exception of prescription meant the issue could not be revisited at trial. However, legal standards permit a peremptory exception to be urged at any time, validating the trial court's reconsideration post-trial. Additionally, Bayou Fleet disputed that it bore the burden of proving its conversion claim had not prescribed. Under Louisiana law, the tort of conversion is subject to a one-year prescriptive period, and generally, the party asserting the exception bears the burden of proof unless prescription is evident from the pleadings, which then shifts the burden to the plaintiff.

Bayou Fleet claims its crane boom was destroyed in November 2007, but this conversion claim appears to be time-barred unless Bayou Fleet can demonstrate otherwise. Ben Bordelon, Bollinger’s VP of Repairs, explained that after Hurricane Katrina, Bollinger decided to close its facility on Jourdan Road, which required complete clearance of the yard per its lease with the Port. To fulfill this obligation, Bollinger Gulf hired Tri-Native and Franklin Services for demolition and cleanup. Joseph Dardar from Tri-Native testified that the demolition began shortly after the October 2007 agreement, with the boom being removed first over a two-week period. Matthew Franklin, president of Franklin Services, confirmed his company started scrapping work almost immediately after the contract was signed and completed the job by February 15, 2008. He stated that scrap tickets for the boom were maintained as part of Franklin Services' records, showing that four loads of scrap metal were taken to a recycling facility on November 9 and 16, 2007. Franklin asserted these tickets were solely for the crane boom. The trial court noted that the 187,720 pounds of scrap sold correlated closely with the estimated weight of the boom, accounting for additional weight from pipe racks cut for scrapping. The court found the evidence consistent with Franklin's testimony, supporting the claim that the scrap tickets pertained to the crane boom.

Dwight Harris, a former dock master for Bollinger Gulf, testified that the crane boom was cut and removed in late June or early July 2008, supporting his claim with his log, which was unfortunately destroyed in a hurricane. His recollection was based on observing the boom tied to a dry dock and the timeline of the dry dock's departure from the Shipyard. However, his testimony was contradicted by Ben Bordelon, who stated the dry dock left by mid-October 2007, and the boom was scrapped shortly thereafter, a date he recalled due to a personal milestone. The trial court found Bordelon's and other witnesses' testimonies credible, establishing that the boom was scrapped by November 2007, supported by scrap tickets. The court deemed Harris's recollection "inexact" and ruled that the boom was destroyed no later than November 16, 2007, which triggered the prescription period for Bayou Fleet’s conversion claim. The trial court also admitted the scrap metal tickets into evidence, rejecting Bayou Fleet's argument against their admissibility, noting that Mr. Franklin had personal knowledge of the boom's destruction and the scrap tickets' connection to the Shipyard. The appellate court emphasized that it cannot overturn the trial court's credibility assessments and factual inferences, given the existence of conflicting testimonies.

Bayou Fleet contends that the trial court improperly denied its Motion in Limine for an Adverse Inference regarding a demolition contract involving Bollinger, Tri-Native, and Franklin Services. The contract produced by Bollinger lacked a referenced “Exhibit 1,” which was essential as it detailed the order of demolition at the Shipyard. Bayou Fleet argues that if the boom had been located in an area scheduled for later demolition, it would indicate that the boom was destroyed after March 16, 2008. The absence of “Exhibit 1” led Bayou Fleet to claim that the court should infer that the boom was likely destroyed later than indicated by other evidence. Bollinger's general counsel, L. Clifton Dickerson, testified that he and a supervisor could not locate “Exhibit 1.” Although Tri-Native and Franklin Services representatives recognized their signatures on the contract, they could not confirm the presence of an exhibit. The trial court’s decision on evidentiary matters like spoliation is granted broad discretion, which will not be overturned unless there is clear abuse of that discretion. Bayou Fleet failed to provide evidence suggesting that Bollinger intentionally withheld “Exhibit 1.” Therefore, the court found no abuse of discretion. 

Additionally, Bayou Fleet invoked the doctrine of contra non valentem, which prevents the strict application of prescription in certain situations. This doctrine includes four scenarios that would excuse a plaintiff from timely filing a claim: (1) legal causes preventing recognition of the action; (2) conditions related to the contract that hinder the plaintiff's claim; (3) defendant actions preventing the plaintiff from pursuing the claim; and (4) the plaintiff’s ignorance of the cause of action, even if not induced by the defendant.

The fourth category of contra non valentem, known as the "discovery rule," allows a plaintiff to initiate a claim without actual knowledge of the facts, provided there is constructive notice. Constructive knowledge arises when a plaintiff has enough information that, if pursued, would reveal the true circumstances. The determination of whether a plaintiff had constructive knowledge hinges on the reasonableness of their actions or inactions, considering their education, intelligence, and the defendant’s conduct. Ignorance due to a plaintiff's own willfulness or neglect does not exempt a claim from the prescriptive period; a plaintiff is expected to know what could have been discovered through reasonable diligence. The discovery rule is an exceptional remedy and is to be applied strictly.

In the case at hand, the trial court concluded that Bayou Fleet should have reasonably known about the destruction of the boom before the one-year prescriptive period expired on November 16, 2007. The court evaluated the reasonableness of Bayou Fleet's actions by considering the educational background and experience of its owners, Peter and Robin Durant. Peter Durant, highly educated with degrees in engineering and extensive experience in marine engineering, and Robin Durant, who has significant industry experience, were assessed to have the sophistication necessary to exercise due diligence. Bayou Fleet contended that it had stored the boom without incident since 1991 and had no reason to suspect any risk. Robin Durant claimed he was not informed about the need to move the boom, asserting that he would have taken action had he been advised of the situation.

Bayou Fleet claims it exercised reasonable diligence by inspecting the boom every 12 to 14 months, with Robin Durant acknowledging the boom's accessibility. Durant confirmed the boom's presence during a 2007 inspection, while Peter Durant noted it was missing during his July 2008 visit, having last seen it in 1996 and not visited since 2005, before Hurricane Katrina. Bayou Fleet argued that frequent inspections from Hahnville to New Orleans would be burdensome. However, the court found that annual inspections were unreasonable given the boom's value of $1.135 million and the short travel distance.

In 2007, the Times Picayune reported Bollinger's lease termination and Shipyard closure due to the U.S. Army Corps of Engineers' actions, although Robin Durant claimed he did not read these articles and did not believe they indicated a need to move the boom. He expected Bollinger would have contacted Bayou Fleet regarding the boom's removal. Testimony from Steve McKinney indicated that knowledge of Bollinger's impending departure was common in the marine industry. The court noted it was implausible that the Durants, with extensive marine business experience, were unaware of the situation that would necessitate moving the boom.

Both Durants stated Bayou Fleet did not receive storage bills from Bollinger and believed the boom was stored in a manner that would not cause issues, serving as a "dead man" for tying up barges. Robin Durant indicated that Bayou Fleet assumed it could leave the boom at the Shipyard without charge and would have moved it had a bill been received.

Peter Durant testified about a 2000 meeting with Richard Ortega, the general manager at Bollinger, regarding the storage and painting of a boom. Durant believed Bollinger had a crane to move the boom, but Ortega stated it was insufficient and that Bollinger had no interest in painting it. Durant proposed leaving the boom at Bollinger, to which Ortega allegedly agreed. However, Ortega denied any conversation with the Durants about the boom or authorizing its storage, asserting that only customers could store property at the Shipyard, and Bayou Fleet was not a customer. Lawrence Brown, Bollinger's operations manager, and Ben Bordelon, the Vice President of Repair, corroborated Ortega's denial.

The trial court favored the testimonies of Ortega, Brown, and Bordelon over those of Peter and Robin Durant, concluding that there was no agreement for Bayou Fleet to store the boom. Dwight Harris, a former dock master, testified he informed Robin Durant about the impending scrapping of the boom but received no return calls. The court found Bayou Fleet had not made reasonable efforts to monitor the boom’s status, effectively abandoning it for 16 years without payment. The court deemed Bayou Fleet's annual inspection of the boom unreasonable given its $1.1 million value and the proximity of Hahnville to New Orleans.

Despite knowledge of Bollinger’s closure in 2007, Bayou Fleet expected to be notified about the boom’s removal, reflecting a lack of diligence. The court determined that Bayou Fleet did not demonstrate that it lacked constructive knowledge of the boom’s destruction before March 16, 2008, which was one year prior to the lawsuit. Consequently, the trial court ruled that Bayou Fleet's conversion claim was prescribed.

In its Answer to Appeal, Bollinger claimed entitlement to rental payments from Bayou Fleet under certain legal doctrines if the trial court's judgment was reversed. However, since the judgment was affirmed, this issue was not addressed.

Bayou Fleet contends that if the court upholds the trial court's December 18, 2014 final judgment, it should reduce Bollinger's awarded costs from $19,794.50 to $6,358.70. The trial court has discretion in awarding costs, which can only be overturned on appeal if there is an abuse of that discretion. La.Code Civ. P. art. 1920 gives the court equitable authority to allocate costs, but this is restricted to those costs defined by law as taxable. Bayou Fleet argues the trial court improperly reimbursed Bollinger $511.53 for travel costs related to a deposition in Houston, which the court agrees with and subsequently reduces the judgment by that amount, referencing Succession of Franz, which states such travel expenses are not taxable under La. R.S. 13:4533.

Bayou Fleet seeks further reductions in clerk’s fees from $2,706.36 to $2,046.86 and sheriff’s fees from $1,473.82 to $965.46, claiming these were for severed third-party claims, but the court finds no abuse of discretion in these fees. Additionally, Bayou Fleet challenges the $11,754.41 in expert fees, arguing that the judge who assessed these costs did not preside over the trial and based the award solely on a spreadsheet of invoices. The court highlights that the trial judge's familiarity with the case is crucial for cost assessments and that the spreadsheet provided by Bollinger lacked sufficient detail and was only supported by an affidavit from Bollinger’s attorney’s office manager.

The court reiterates that expert witness fees, as outlined in La. R.S. 13:3666(A), are recoverable for trial testimony and preparation, but the amount billed does not dictate the taxable costs. The determination of reasonable expert fees is case-specific and involves multiple factors, including time spent on reports, trial preparation, and court appearances, along with the expert's qualifications and the complexity of their work.

A litigant can recover expert fees only for services rendered directly related to trial assistance, as established in Buffman, Inc. v. Lafayette Ins. Co. Expert fees for trial preparation are allowed, but not for attorney consultations. In the case at hand, Bollinger failed to provide detailed invoices or supporting affidavits from the expert, submitting only a summary spreadsheet listing total amounts without service descriptions. Consequently, the record was insufficient to assess the trial court's judgment on expert fees, leading to the vacating of the $11,754.41 fee award and a remand for an evidentiary hearing to properly evaluate the fees.

Bollinger's request for an upward modification of the costs was unsupported and deemed without merit, as the trial court was found not to have abused its discretion in denying $29,866.61 in other costs. The court upheld the trial court's dismissal of Bayou Fleet's conversion claim against Bollinger and affirmed the judgment regarding costs, reducing the awarded amount by $511.53 due to improperly claimed travel expenses. Additionally, the trial court's denial of $974.50 in travel costs for a deposition in Boston was also affirmed. The overall decision was to affirm in part, vacate in part, and remand for further proceedings regarding expert fees.