SUSAN M. CHEHARDY, Chief Judge.
In this case, the purchaser filed suit against the seller and the manufacturer of
Live Oak Homes Corporation ("Live Oak") is a maintenance and construction contractor for several residential apartment complexes. On December 7, 2006, Live Oak purchased 416 Air Handler Units ("units"), which had been manufactured by Multiaqua, Inc. ("Multiaqua"), from Carrier Sales and Distribution, L.L.C. ("Carrier"). The total purchase price of the units was $117,242.33.
In 2007, Live Oak installed 172 of the units in three apartment complexes located in the metropolitan New Orleans area. When the weather turned cold in late 2007, tenants in 23 apartments reported that the units would not heat their apartments. Live Oak reported the problem to Carrier then to Multiaqua.
Live Oak hired two independent heating and cooling equipment specialists to investigate the problem. One specialist reported that the units were not operating properly as heaters because excessive radiant heat inside of the units was "overheating" the thermal overload device.
On April 29, 2008, Live Oak made formal demand upon Carrier and Multiaqua to return the purchase price and the cost of installation and removal of the installed units. Neither Carrier nor Multiaqua complied with the demand.
On June 4, 2008, Live Oak filed suit against Carrier, as the seller, and Multiaqua, as the manufacturer, alleging that the air handler units had a redhibitory defect. Carrier answered, denying the allegations of the petition and filed a cross-claim against the manufacturer, Multiaqua.
Multiaqua answered denying the allegations of the petition and raising the defense that the units that were installed failed due to an "incompatibility with the ventilation and electrical systems" extant in the buildings where Live Oak installed the units.
On January 10, 2012, Live Oak moved for partial summary judgment on the basis that the air handlers at issue were "not fit for their intended purpose." Live Oak attached to its motion for summary judgment, an affidavit and excerpts from the deposition of its employee, Joey Baldassaro;
On March 7, 2012, Carrier filed its opposition to Live Oak's motion for partial summary judgment on the basis that it had supplied equipment that matched the specifications provided by Live Oak. To its opposition, Carrier attached an affidavit from its employee, Mike Judge; a copy of the equipment quotation made by Carrier to Live Oak through its agent, Joey Baldassaro; and the entire deposition of Joey Baldassaro as well as copies of his licenses and certifications.
On March 12, 2012, Multiaqua filed its opposition to Live Oak's motion for partial summary judgment on the basis that there existed a genuine issue of material fact as to whether the air handlers contained a design defect. To its opposition, Multiaqua attached an affidavit from its principal, Ralph Feria and an excerpt from Joey Baldassaro's deposition.
On October 18, 2012, the trial judge heard the motion for partial summary judgment and took the matter under advisement. The next day, the trial judge granted partial summary judgment in favor of Live Oak, finding that "Live Oak has established as a matter of law that the overheating of the units was due to a redhibitory defect."
On November 26, 2012, trial of the quantum of damages commenced. At the beginning of trial, the parties stipulated that Live Oak purchased the air handler units in question through Carrier for $117,242.33 and Multiaqua is the "de facto manufacturer" of those units. After hearing two days of testimony and evidence, the trial judge took the matter under advisement.
On February 27, 2013, the trial judge rendered judgment in favor of Live Oak, against Multiaqua and Carrier for $216,099.65, plus "interest on the purchase price of $117,242.33 from the date(s) purchase price was paid." Further, the trial judge awarded attorneys' fees to Live Oak from Multiaqua of $65,575.88, "plus actual attorneys' fees for preparation and filing of the post-trial brief and financial reconciliation." In her written reasons for judgment, the trial judge stated:
▀ Labor to remove and replace 172 Multiaqua units $77,197.50
Miscellaneous expenses including expert fees, rental concessions,
▀ repair service calls, and space heaters for tenants $10,305.41
▀ Testing of units to prove defect $15,479.11
▀ Reimbursement for storage of 410 units $8,585.00
___________
$111,567.02
The total award to Live Oak of $228,809.35 was subject to a credit in favor of Multiaqua of $12,709.70 for Live Oak's use of the units; thus, the award of $216,099.65, plus interest from the date(s) of purchase and attorneys' fees.
On March 13, 2013, after the initial judgment was rendered, Carrier moved for a new trial or amendment of the judgment to assert its claim for attorneys' fees of $26,328.16, pursuant to the parties' stipulation at trial. That same day, the trial judge rendered an amended judgment, including the previous judgment and adding judgment in favor of Carrier against Multiaqua in the stipulated amount for attorneys' fees.
On April 8, 2013, Multiaqua filed a suspensive appeal, which was granted that same day. On April 9, 2013, the trial judge issued a "supplemental judgment" against Multiaqua, awarding Live Oak the additional sum of $5,512.50 for "legal fees for preparation and filing of post-trial brief and financial reconciliation."
On appeal, Multiaqua raises seven assignments of error challenging the finding of liability and the award of damages. Multiaqua specifically argues: first, the trial court erred in determining the air handler units had a redhibitory defect; second, the trial court erred in not finding that Live Oak suffered a diminution of the warranty due to failure to allow Multiaqua the opportunity to make the required repairs; third, the trial court erred in not finding that Live Oak failed to care for the air handler units as a prudent administrator; fourth, the trial court erred in not awarding Live Oak a reduction in price in proportion to Live Oak's interest, pursuant to La. C.C. art. 2538; fifth, the trial court erred in awarding Live Oak the sum of $77,197.50 for labor to remove and replace the 172 Multiaqua units; sixth, the trial court erred in awarding Live Oak the sum of $15,479.11 for unit testing prior to the Court's finding of a redhibitory defect; and, finally, the trial court erred in awarding $8,585.00 for the equitable amount of reimbursement for storing the units in two of Live Oaks vacant apartment units and unused storage containers.
At this point, we must note a clerical error in the judgment granting Live Oak's motion for partial summary judgment. That judgment is dated October 19,
In its first assignment of error, Multiaqua argues that the trial court erred in granting summary judgment, finding that the air handler units had a redhibitory defect. Multiaqua specifically contends that the trial judge erred in finding that "regardless of which of the two mechanisms caused the malfunction, the units nonetheless contained a redhibitory defect."
Summary judgment will be granted if the pleadings, depositions, answers to interrogatories, admissions on file, and any affidavits show that there is no genuine issue as to material fact, and that the mover is entitled to judgment as a matter of law. La. C.C.P. art. 966(B). The party bringing the motion bears the burden of proof; however, where the moving party will not bear the burden of proof at trial, the moving party must only point out that there is an absence of factual support for one or more elements essential to the adverse party's claim. La. C.C.P. art. 966(C)(2); Babin v. Winn-Dixie Louisiana, Inc., 00-0078 (La.6/30/00), 764 So.2d 37, 38-41.
On appeal, our review of summary judgments is de novo under the same criteria that govern the district court's consideration of whether summary judgment is appropriate. Pizani v. Progressive Ins. Co., 98-225 (La.App. 5 Cir. 9/16/98), 719 So.2d 1086, 1087. The decision as to the propriety of a grant of a motion for summary judgment must be made with reference to the substantive law applicable to the case. Muller v. Carrier Corp., 07-770 (La.App. 5 Cir. 4/15/08), 984 So.2d 883, 885.
In Louisiana, the seller warrants the buyer against redhibitory defects, or vices, in the thing sold. La. C.C. art. 2520 further provides:
"The warranty against redhibitory defects covers only defects that exist at the time of delivery." La. C.C. art. 2530; Aucoin v. Southern Quality Homes, LLC, 07-1014 (La.2/26/08), 984 So.2d 685, 691.
The extent of a seller's liability to a buyer for breaching this warranty depends on whether the seller knew, or did not know, of the defect. See La. C.C. arts. 2531 and 2545. With regard to a seller who knew of the defect, La. C.C. art. 2545 provides as follows:
A manufacturer is conclusively presumed to have knowledge of defects in the object it manufactures. Id.; Young v. Ford Motor Co., Inc., 595 So.2d 1123, 1126 (La.1992). Because of this presumption, the manufacturer "is deemed to be in bad faith in selling a defective product" and is liable to the buyer for all damages recoverable under La. C.C. art. 2545. Pratt v. Himel Marine, Inc., 01-1832 (La.App. 1 Cir. 6/21/02), 823 So.2d 394, 404, writs denied, 02-2128, 02-2025 (La.11/1/02), 828 So.2d 571, 572. A buyer can recover directly from the manufacturer for breach of warranty, despite the fact that there is no privity of contract between them. Aucoin v. Southern Quality Homes, LLC, supra, at 692.
In this case, the trial court held that the redhibitory defects were manufacturing defects, for which the manufacturer is liable. The trial court found that there was "overwhelming evidence indicating that the overheating was caused by a design flaw in the way the heating elements were cooled," which was clearly attributable to the manufacturer. Based on our de novo review of the record, we find no manifest error in the trial court's finding that the manufacturing defects were redhibitory. Finding no error in the trial court's finding of redhibitory defects, we affirm the judgment as amended, supra.
In its second assignment of error, Multiaqua argues that the trial court erred in failing to find that Live Oak suffered a "diminution" of Multiaqua's warranty because Live Oak refused to allow Multiaqua to "repair" the units.
First, the buyer's obligation to tender the product for repair or correction applies only to a good-faith seller but not to a manufacturer, who is presumed to have knowledge of the defects. Hale Farms, Inc. v. Am. Cyanamid Co., 580 So.2d 684, 695 (La.App. 2 Cir.1991), writ denied, 586 So.2d 537 (La.1991).
Second, the record reflects that Live Oak did allow Multiaqua the opportunity to repair the units by installing a deflector inside of the unit to deflect air toward the heating coils to cool the coils. Carlos Mena installed and adjusted deflectors inside of the air handler at Multiaqua's direction, but the repair did not correct the problem of the units' overheating.
Finally, "[t]he fact that the defects were confined to a specific part of the machinery and that the units could have been made to function properly by installing new motors or by rehabilitating the defective ones, does not furnish a valid basis for denying plaintiff the remedy of redhibition provided by Article 2520." Radalec, Inc. v. Automatic Firing Corp., 228 La. 116, 122-23, 81 So.2d 830, 832 (1955). We find no merit in Multiaqua's argument that its warranty against defects was somehow "diminished" by the buyer's decision not to attempt further repairs. This assignment of error lacks merit.
In its third assignment of error, Multiaqua argues that the trial court erred in failing to find that Live Oak did not act as a prudent administrator. Specifically, Multiaqua contends that the trial court
La. C.C. art. 2532 provides:
At trial, Multiaqua's principal, Ralph Feria, testified that the air handler units that he recovered from Live Oak had been stored for at least four years, by the time of trial, in non-climate-controlled shipping containers, which were not weatherproof. His expert testified that at least one-third, if not more, of the units were inside of cardboard boxes that had disintegrated under the storage conditions. Mr. Feria stated that, based on the conditions the units had been exposed to while in Live Oak's care, there value was as "scrap."
Live Oak's agent, Joey Baldassaro, testified that the units is question became obsolete in 2010 when the refrigerant, R-22, was discontinued for use in new air conditioning systems.
Based on the testimony and evidence introduced at trial, the trial judge found that Multiaqua did not establish that Live Oak failed to act as a prudent administrator. See, Hughes v. Goodreau, 01-2107 (La.App. 1 Cir. 12/31/02), 836 So.2d 649, 666, writ denied, 03-0232 (La.4/21/03), 841 So.2d 793. A court of appeal may not set aside a trial court's finding of fact in the absence of "manifest error" or unless it is "clearly wrong." Rosell v. ESCO, 549 So.2d 840 (La.1989). We find no manifest error in the trial court's ruling. This assignment of error lacks merit.
In its fourth assignment of error, Multiaqua argues that Live Oak is not the only buyer so its interest should have been limited to a reduction in price proportionate to its interest.
La. C.C. art. 2538 reads, in pertinent part: "Multiple buyers must concur in an action for rescission because of a redhibitory defect. An action for reduction of the price may be brought by one of multiple buyers in proportion to his interest."
At trial, Live Oak's representative, Joey Baldassaro, testified that Live Oak was the sole owner of the air handler units at all times pertinent to this litigation. Accordingly, we find no merit in Multiaqua's argument.
Lastly, Multiaqua levies complaints against several items of damages the trial court awarded, including the removal and replacement of 172 air handler units; electrical voltage testing of air handler units performed by Live Oak; and storage fees.
In this case, Live Oak presented evidence of the following expenses at trial,
The trial judge, however, awarded 1) $77,197.50 for removal and replacement of 172 Multiaqua units; 2) $15,479.11 for electrical testing of the units; and 3) $8,585.00 for storage of the units after removal, which is significantly lower than the damages prayed for by Live Oak.
On appeal, Multiaqua seeks diminution of the quantum of damages awarded.
A manufacturer is "liable to the buyer for the return of the price with interest from the time it was paid, for the reimbursement of the reasonable expenses occasioned by the sale and those incurred for the preservation of the thing, and also for damages and reasonable attorney fees." La. C.C. art. 2545. The trier of fact is given much discretion in the assessment of damages. La. C.C. art. 2324.1. The ultimate determination by an appellate court as to whether a judge abused their "much discretion" as a matter of law in awarding damages is a judgment call. Coco v. Winston Indus., Inc., 341 So.2d 332, 335 (La.1976); Carnaggio v. Cambre, 11-552 (La.App. 5 Cir. 12/13/11), 84 So.3d 631, 640.
Before an appellate court can disturb a trial court's award, the record must clearly reveal that the trier of fact abused its discretion in making its award. Coco v. Winston Industries, Inc., 341 So.2d 332, 335 (La.1976). "Only after making the finding that the record supports that the lower court abused its much discretion can the appellate court disturb the award, and then only to the extent of lowering it (or raising it) to the highest (or lowest) point which is reasonably within the discretion afforded that court." Id.
Upon review, we find that the record does not clearly reveal an abuse of discretion by the trial court in its award. Finding no abuse of the trial court's discretion, we find this argument without merit.
