Judge Terri F. Love
This appeal arises from class action litigation regarding damages suffered by plaintiffs buying property, living, or working on or near a former landfill. Having previously adjudicated the class certification and common issues of liability against the housing authority and the City of New Orleans, the trial court began assessing damages to the first flight of non-class representative plaintiffs. The trial court assessed the plaintiffs' emotional distress damages and awards for diminution in property values. The housing authority and the City of New Orleans appealed the trial court's judgment contending that the claims were prescribed, awards were improperly calculated, and that workers' compensation barred some plaintiffs' recovery.
We find that numerous assignments of error raised on appeal are barred by the doctrine of res judicata. Further, the plaintiffs' claims were not prescribed, as the suit was filed within one year of the discovery of the contamination. The exclusive remedy of worker's compensation was untimely raised and does not apply. The plaintiffs proved they suffered from emotional distress, and the trial court did not abuse its discretion in making those awards. The trial court did not commit manifest error by calculating the diminution in property values based on a combination of the expert testimony presented. The defendants were not entitled to an offset for payments received by the plaintiffs after Hurricane Katrina because the payments were not duplicative. Accordingly, the judgment of the trial court is affirmed.
Plaintiffs' complaints arose from working, renting, or owning a home on or adjacent to the Agriculture Street Landfill ("ASL"). Plaintiffs were exposed to toxic materials after the U.S. Department of Housing and Urban Development ("HUD") approved the development of public and private housing, elderly housing, and businesses on and near a site that the City of New Orleans ("City") previously leased and utilized as the ASL. Plaintiffs are the first flight of plaintiffs to proceed
Johnson v. Orleans Par. Sch. Bd., 06-1223, pp. 1-6 (La.App. 4 Cir. 1/30/08), 975 So.2d 698, 703-05 ("Johnson VI").
The trial court conducted a common issues and liability trial that also adjudicated the nine class representatives' damages claims. "The trial court found the City (50%), HANO (50%) and their insurers liable jointly and in solido to the members of the first three sub-classes." Johnson VI, 06-1223, p. 6, 975 So.2d at 705. "The trial court found that the city was negligent in its actions and inactions that resulted in the conversion of its own former municipal landfill into a residential area that the EPA deemed unreasonably dangerous in 1994." Id., 06-1223, pp. 7-8, 975 So.2d at 706. "This finding was based on Civil Code Article 2315 as it existed prior to 1980." Id. "HANO was found negligent under Civil Code Article 2317 as it existed prior to 1980." Id.
On appeal, we reduced the trial court's awards for emotional distress damages by 50% and affirmed the remainder of the judgment. Johnson VI, 06-1223, p. 24, 975 So.2d at 714. The Louisiana Supreme Court denied the seven writs sought. Johnson v. Orleans Par. Sch. Bd., 08-0607 (La. 6/27/08), 983 So.2d 1289, and writ denied, 08-0664 (La. 6/27/08), 983 So.2d 1289, and writ denied, 08-0671 (La. 6/27/08), 983 So.2d 1289, and writ denied, 08-0672 (La. 6/27/08), 983 So.2d 1290, and writ denied, 08-0673 (La. 6/27/08), 983 So.2d 1290, and writ denied, 08-0674 (La. 6/27/08), 983 So.2d 1290, and writ denied, 08-0675 (La. 6/27/08), 983 So.2d 1291, and writ denied, 08-0682 (La. 6/27/08), 983 So.2d 1291. The United States Supreme
The damages trial for the first flight of 65 non-class representative plaintiffs commenced in 2013. Following a lengthy bench trial, the trial court dismissed four plaintiffs' claims for their failure to appear at trial. The trial court issued a lengthy judgment, which was later amended after motions for new trial were filed. The trial court denied the defendants' claims of prescription, and found that the affirmative defense of worker's compensation was untimely raised, as it was raised, for the first time in 20 years, at trial. The trial court awarded the remaining plaintiffs damages for emotional distress. Further, the trial court made awards for diminution in property values utilizing present day values for Gordon Plaza residents, and pre-Hurricane Katrina values for Press Park townhome owners. HANO and the City's (collectively "Defendants") suspensive appeals followed.
The Defendants contend that the trial court erred by finding that the plaintiffs' claims were not prescribed, erred by awarding/calculating emotional distress damages, and that the calculations for the diminution of property awards were flawed. The Defendants also assert that the trial court erred by not assigning fault to anyone other than them, holding them solidarily liable, and holding them liable for damages caused by Hurricane Katrina.
Factual determinations are reviewed using the manifest error/clearly wrong standard of review. Hall v. Folger Coffee Co., 03-1734, p. 9 (La. 4/14/04), 874 So.2d 90, 98. This "precludes the setting aside of a district court's finding of fact unless that finding is clearly wrong in light of the record reviewed in its entirety." Id. "[A] reviewing court may not merely decide if it would have found the facts of the case differently." Id. "Therefore, the appellate review of facts is not completed by reading so much of the record as will reveal a reasonable factual basis for the finding in the trial court; there must be a further determination that the record establishes that the finding is not clearly wrong (manifestly erroneous)." Arceneaux v. Domingue, 365 So.2d 1330, 1333 (La. 1978). "Accordingly, if an appellate court concludes that the trial court's factual findings are clearly wrong the mere fact that some record evidence appears which would furnish a reasonable factual basis for the contested findings does not require affirmance." Mart v. Hill, 505 So.2d 1120, 1127 (La. 1987).
Additionally, "[w]hen findings are based on determinations regarding the credibility of witnesses, the manifest error-clearly wrong standard demands great deference to the trier of fact's findings." Rosell v. ESCO, 549 So.2d 840, 844 (La. 1989). "[O]nly the factfinder can be aware of the variations in demeanor and tone of voice that bear so heavily on the listener's understanding and belief in what is said." Id. "Where documents or objective evidence so contradict the witness's story, or the story itself is so internally inconsistent or implausible on its face, that a reasonable fact finder would not credit the witness's story, the court of appeal may well find manifest error or clear wrongness." Id., 549 So.2d at 844-45. "[W]here such factors are not present, and a factfinder's finding is based on its decision to credit the testimony of one of two or more witnesses, that
"Although appellate courts must accord great weight to the factual findings of the trial judge, these same courts have a duty to determine if the fact finder was justified in his conclusions." Mart, 505 So.2d at 1127. Further,
Id.
"However, when a legal error has restricted or interdicted the fact-finding process, the abuse of discretion standard no longer applies, and we apply a de novo standard of review." Provosty v. Arc Constr., LLC, 15-1219, p. 7 (La.App. 4 Cir. 11/2/16), 204 So.3d 623, 629. "A legal error exists upon the application of incorrect principles of law that deprives a party of substantial rights." Id.
When reviewing questions of law, appellate courts use the de novo standard. Harold A. Asher, CPA, LLC v. Haik, 12-0771, p. 5 (La.App. 4 Cir. 4/10/13), 116 So.3d 720, 724. Mixed questions of law and fact are reviewed with the manifest error standard of review. Barrois v. Panepinto, 13-0577, p. 3 (La.App. 4 Cir. 1/8/14), 133 So.3d 36, 38.
The Defendants raise numerous assignments of error that the plaintiffs contend are precluded because of res judicata. As the plaintiffs' argument is meritorious, we address these matters first.
"The civilian concept of res judicata is based upon a presumption of correctness." Burguieres v. Pollingue, 02-1385, p. 7 (La. 2/25/03), 843 So.2d 1049, 1053. "The doctrine of res judicata precludes re-litigation of claims and issues arising out of the same factual circumstances when there is a valid final judgment." Myers v. Nat'l Union Fire Ins. Co. of Louisiana, 09-1517, p. 5 (La.App. 4 Cir. 5/19/10), 43 So.3d 207, 210. "It promotes judicial efficiency and final resolution of disputes." Ave. Plaza, L.L.C. v. Falgoust, 96-0173, p. 4 (La. 7/2/96), 676 So.2d 1077, 1079. La. R.S. 13:4231 provides:
"Res judicata cannot be invoked unless all its essential elements are present and each
In regards to class actions, "[a] definitive judgment on the merits rendered in a class action concludes all members of the class, whether joined in the action or not, if the members who were joined as parties fairly insured adequate representation of all members of the class." La. C.C.P. art. 597.
The present appeal pertains to the damages trial of the first flight of non-class representative plaintiffs in the ASL class action. The previous common issues trial determined liability and methods of awarding emotional distress damages. The parties are identical: the defendants and members of the certified class. The Louisiana Supreme Court denied writs, and the United States Supreme Court denied cert. Accordingly, we find that the holdings from the first trial bar reconsideration of the Defendants' following assignments of error: 1) the trial court erred in using a formula for awarding emotional distress damages,
The trial court found that the class members' claims were timely filed on August 31, 1993. The Defendants contend that the trial court erred by finding that the plaintiffs' claims were not prescribed, as many of the 61 plaintiffs had some degree of knowledge about a landfill or city dump.
"[P]rescription is defined as a means of acquiring real rights or of losing certain rights as the result of the passage of time." Taranto v. Louisiana Citizens Prop. Ins. Corp., 10-0105, p. 5 (La. 3/15/11), 62 So.3d 721, 726. "[T]he fundamental purpose of the prescription statutes is `to afford a defendant economic and psychological security if no claim is made timely and to protect the defendant from stale claims and from the loss or non-preservation of relevant proof.'" Id., 10-0105, p. 6, 62 So.3d at 726, quoting Cichirillo v. Avondale Indus., Inc., 04-2894, 04-2918, p. 9 (La. 11/29/05), 917 So.2d 424, 430.
"Prescription runs against all persons unless exception is established by legislation." La. C.C. art. 3467. "Prescription begins to run when it is determined that damage was sustained." Landry v. Blaise, Inc., 02-0822, p. 4 (La.App. 4 Cir. 10/23/02), 829 So.2d 661, 664. "Damage is sustained, for purposes of prescription, only when it has manifested itself with sufficient certainty to be susceptible to proof, in a court of justice." Id., 02-0822, p. 4, 829 So.2d at 664-65. "Liberative prescription on the claims arising out of the transactions or occurrences described in a petition brought on behalf of a class is suspended on the filing of the petition as to all members of the class as defined or described therein." La. C.C.P. art. 596.
However, Louisiana has developed "the jurisprudential doctrine of contra non valentem as an exception to this statutory rule." Marin v. Exxon Mobil Corp., 09-2368, 09-2371, p. 11 (La. 10/19/10), 48 So.3d 234, 245. The four situations wherein contra non valentem may apply are:
Id., 09-2368, 09-2371, p. 12, 48 So.3d at 245. "[T]he Louisiana Supreme Court has cautioned that the doctrine only applies in exceptional circumstances." Felix v. Safeway Ins. Co., 15-0701, p. 5 (La.App. 4 Cir. 12/16/15), 183 So.3d 627, 630. "[P]rescription does not run against one who is ignorant of the facts upon which his cause of action is based, as long as such ignorance is not willful, negligent or unreasonable." Johnson VI, 06-1223, p. 11, 975 So.2d at 708.
While the first three scenarios do not apply to the present matter, the trial court and the Johnson VI court found, and, we agree, that the fourth category known as the discovery rule applies to the plaintiffs' claims. After reviewing the plaintiffs' trial testimony, the trial testimony of family members of the deceased, and the depositions of those plaintiffs deceased or unavailable, nothing indicates that the plaintiffs knew or should have known that the land they lived or worked on contained numerous dangerous and hazardous toxins, some of which have been shown to cause cancer. The trial court aptly summarized the facts surrounding prescription of the plaintiffs' claims as follows:
Furthermore, as stated by the Johnson VI court, "[i]f we are to assume that these defendants, who were in a superior position as to know what was going on, were not overly concerned about any potential harm or injury to the plaintiffs, we must assume the same for the plaintiffs." Johnson VI, 06-1223, pp. 11-12, 975 So.2d at 708. The plaintiffs all testified that they learned of the contamination around 1993-1994, within one year of filing suit. Accordingly, following our de novo review, we find no error in the trial court's finding that the plaintiffs' claims were not prescribed.
The Defendants assert that the trial court erred by awarding damages to three of the sixty-one plaintiffs who were former HANO employees or statutory employees. The Defendants aver that worker's compensation statutes provide the exclusive remedy for those plaintiffs.
The trial court stated that the Defendants never raised worker's compensation
"[T]he tort immunity provided by the [worker's compensation] Act operates as an affirmative defense; it is not a law evaluating conditions of legality of defendant's conduct but, rather, serves as a vehicle for asserting a substantive defense that defeats an otherwise viable claim." Brown v. Adair, 02-2028, p. 5 (La. 4/9/03), 846 So.2d 687, 690. See also La. C.C.P. art. 1005. "[T]he employer bears the burden of proving entitlement to the immunity." Weber v. State, 635 So.2d 188, 191 (La. 1994). Failure to timely raise such an affirmative defense may result in the waiver of said defense to avoid trial by ambush. Teasley v. Ates, 03-824, p. 5 (La.App. 3 Cir. 12/10/03), 861 So.2d 778, 781.
Nothing in the record on appeal demonstrates that worker's compensation was raised in an exception or pled as an affirmative defense prior to the first trial or before the current damages trial for the first flight of plaintiffs. Given that worker's compensation as an exclusive remedy was not raised until day seven of the trial, some twenty years after the start of litigation, we find that the trial court did not err in finding the defense was untimely raised.
Notwithstanding the untimeliness, the exclusive remedy of worker's compensation fails. The Defendants claim that worker's compensation barred an award of damages to plaintiffs: McArthur Samuels, Jr., Jacquelyn Bates, and Eddison Johnpire, Sr. Mr. Samuels, Jr. was employed by the Press Park Community Development. However, his claims were based on his ownership of a Gordon Plaza home and the emotional distress he suffered as a result. Ms. Bates was a direct employee of HANO part-time after school in junior high school and high school. Yet again, however, her claims were based upon her later ownership of a Gordon Plaza home and the resulting emotional distress. As such, the claims of Mr. Samuels, Jr. and Ms. Bates were not related to their employment. Mr. Johnpire, Sr. worked for the Press Park Homebuyers' Association for approximately twenty-two years. He was not a HANO employee. HANO did not present evidence, nor proffer evidence, to establish that Mr. Johnpire, Sr. was a statutory employee of HANO. Accordingly, worker's compensation does not apply.
Even though we found that the Defendants' assertion that the trial court erred in its method of awarding emotion distress damages was barred due to res judicata, the Defendants nonetheless also contend that the plaintiffs did not meet their burden of proving they suffered from emotional distress. The Defendants also maintain that the law regarding the required proof for emotional distress damages has changed since the initial trial on liability and for the class representatives.
"The legal standard for the recovery of negligent infliction of emotional distress absent physical injury is that the plaintiff must show an `especial likelihood of genuine and serious mental distress, arising from the special circumstances, which serves as a guarantee that the claim is not spurious.'" Lester v. Exxon Mobil Corp., 12-1709, p. 8 (La.App. 4 Cir. 6/26/13), 120 So.3d 767, 774, quoting Bonnette v. Conoco, Inc., 01-2767, pp. 22-23 (La. 1/28/03), 837 So.2d 1219, 1234. "The jurisprudence, however, has limited such recovery by requiring that the emotional distress be severe and not merely the result of the usual worry or anxiety attendant
While none of the sixty-one plaintiffs sought professional help for their emotional distress related to owning, living, or working on property contaminated by the ASL, all of the plaintiffs, via live testimony or deposition, explained their emotional distress in dealing with the repercussions of the ASL. This included their apprehension regarding gardening, entertaining outside, and allowing their children to play outside. The plaintiffs all testified as to how long they lived or worked on the site.
The trial court's findings were as follows:
For 1-up to 5 years $2,000 (per year) For 5-up to 10 years $12,500.00 (total) For 10-up to 15 years $15,000.00 (total) For 15-up to 20 years $20,000.00 (total) For 20 years or more $25,000.00 (total)
The trial court judge was in the best position to weigh each plaintiff's credibility. In addition, the plaintiffs testified as to whether they owned or rented property on or adjacent to the ASL and whether they just worked on the ASL. The trial court then awarded emotional damages in accordance with the methods established at the initial trial. The Louisiana Supreme Court subsequently denied writs and the United States Supreme Court denied cert.
The Defendants contend that the trial court erred by accepting the plaintiffs' real estate expert and by finding that the properties possessed a permanent stigma.
The plaintiffs' expert appraiser, Kermit Williams, testified regarding his methods for valuing the properties located on or adjacent to the ASL. Mr. Williams possessed experience with properties affected by stigma or environmental problems. He stated that all of the ASL properties suffered stigma damage due to the incurable defect of being located on top of the ASL. Additionally, Mr. Williams testified that the land-use restrictions further increased that stigma for properties on the ASL. Mr. Williams stated that the properties located on the ASL suffered from a permanent stigma, while the stigma attached to adjacent properties would decrease in twenty to thirty years. Overall, he estimated an approximate 25% decrease in the Gordon Plaza property values based on the environmental stigma.
Jimmy Thorns, a real estate appraiser called by the Defendants, did not possess expert experience in stigma or environmental damages, but testified that the properties were valued 12.5% lower than other comparable properties.
The Defendants' real estate analyst, consultant, and appraiser, Richard Roddewig, testified that he was an expert analyst on the effects of environmental contamination and environmental stigma on property value. Mr. Roddewig relied upon the appraisals of Mr. Thorns. He explained his methodologies for comprising his devaluation figures to the trial court and calculated a range of between 10-15% stigma: 10% for remediated homes and 15% for non-remediated homes. Further, he assigned a 6-12% stigma impact on shell/gutted properties and 5% for properties adjacent to the ASL. Mr. Roddewig stated that the impact on the properties was temporary and that it would decrease in the future. However, he could not opine as to how long it would take for the decrease to occur.
The trial court found that the plaintiffs' properties were only partially remediated by the EPA, and that the contaminants remain below the protective layer of soil, where there is a protective layer. The trial court further found that the land-use restrictions, the association with a "Superfund site," and the "continuing presence of toxic and hazardous materials directly under the Plaintiffs' homes" combined "to reduce the value of the Plaintiffs' properties below that of comparable, but unimpaired properties, in the New Orleans area."
Furthermore, after considering all of the expert testimony, the trial court concluded that the Gordon Plaza homes suffered a 20% loss in the present-day value, which was "entirely due to the ongoing, ever-present contamination of the soil in the ASL site." The trial court found that the 20% valuation was a reasonable compromise between the values presented by the experts.
As for the Press Park properties, the trial court averaged the appraisers' pre-Katrina values for each property and awarded 20%. The trial court utilized the pre-Katrina valuations because HANO has prevented the Press Park townhome owners from entering and rebuilding their property.
The trial court arrived at the above-discussed conclusions after weighing the experts' testimony and conducting painstaking calculations for each plaintiff homeowner. The Defendants disagree with the method and analysis used by Mr. Williams. However, the trial court determined that the experts' calculations were all reasonable. Accordingly, the trial court averaged the figures and awarded a percentage of damages between the experts' percentages. As such, we do not find that the trial court committed manifest error by weighing the experts' testimony and choosing to award damages for the diminution in property values based on a combination of the experts' calculations.
The Defendants contend that they were "entitled to offsets for the Road Home and insurance payments received by the plaintiffs" because the payments served as a double or triple payment. This argument lacks merit.
The payments received by plaintiffs after Hurricane Katrina were not for the same damage caused by the Defendants. As stated by the trial court:
None of the payments were duplicative. Therefore, the Defendants' assignment of error has no merit.
For the above-mentioned reasons, we find that the Defendants' assignments of error regarding the formulaic calculation of emotional distress damages, comparative fault, and solidary liability are barred by the doctrine of res judicata. The Plaintiffs' claims were not prescribed because the testimony demonstrates that they discovered the contamination within one year of filing suit. The exclusive remedy of worker's compensation was untimely raised and is inapplicable. The trial court did not err by finding that the plaintiffs proved emotional distress or abused its discretion in calculating the amount of damages. Further, the trial court did not commit manifest error by calculating damages
We agree with the trial court. The Defendants should not benefit from their own actions following the destruction of Hurricane Katrina. Thus, the trial court did not commit manifest error by using the pre-Katrina valuations for the Press Park townhomes.
