ROSEHILL CONSTRUCTION LLC v. TED HEBERT LLC (2025)

This is an appeal from the trial court's award of attorney fees as sanctions for a frivolous claim. For the following reasons, we vacate the portion of the judgment imposing sanctions, and the matter is remanded for the trial court to comply with La. Code Civ. P. art. 863(G).

FACTS AND PROCEDURAL HISTORY

On September 26, 2017, Rosehill Construction, LLC (“Rosehill”) entered into a contract with Ted Hebert, LLC (“Hebert”) for sewer-related work for a construction project to build a storage facility (“the subcontract”). Because the sewer system would ultimately be part of the public system and maintained by the City of Baton Rouge/East Baton Rouge Parish (“City Parish”), part of Hebert's scope of work included installing a system that met all of the City Parish requirements and coordinating inspections with the City Parish. When Hebert completed the sewer work, Hebert, as required by the subcontract, notified the City Parish to coordinate the City Parish's inspection of the sewer. Around thirty days later, Compliance EnviroSystems (“CES”) conducted an inspection of the sewer pipe installed by Hebert for the City Parish using CCTV ¹ cameras. Nathan Cobb, an engineer with the City Parish Department of Public Works, reviewed the video footage and CES reports for the City Parish. Hebert failed this inspection as the City Parish found that there were deficiencies in Hebert's sewer work that had to be remedied.

Thereafter, Rosehill gave notice to Hebert to proceed with correcting the deficiencies. Hebert attempted to correct the deficiencies. At the end of May 2018, a second video inspection was conducted, and the City Parish again found deficiencies in the sewer. After Hebert attempted to correct the deficiences the City Parish identified in the second inspection, in July 2018, a third video inspection was conducted, and again the City Parish found deficiencies in the sewer. Hebert's work never passed final inspection by the City Parish. On August 30, 2018, Rosehill notified Hebert that it was terminating the subcontract for cause.

On November 30, 2018, Rosehill filed a “Petition for Damages” against Hebert, alleging that Hebert breached the subcontract by failing to perform the work in accordance with the subcontract. Specifically, Rosehill contended that Hebert failed three separate City Parish inspections in violation of the subcontract. Hebert answered Rosehill's petition, asserting several affirmative defenses and asserting a reconventional demand for breach of contract for nonpayment of work that Hebert performed. On April 3, 2019, Hebert filed a “Third Party Demand” naming as defendants Stantec Consulting Services, Inc., the City Parish, and Mr. Cobb. In its third-party demand, Hebert alleged that “Video or CCTV inspections (1) are not approved or authorized by the City-Parish and are thus unlawful and (2) impose a tolerance capacity beyond present installation technology, thereby creating an impossible obligation for Hebert.” Hebert further alleged that Mr. Cobb who worked for the City Parish “acted outside his authority and capacity as an agent for the City-Parish by mandating the use of Video or CCTV inspections on all gravity sewers on the Project.”

In response, the City Parish and Mr. Cobb (hereafter referred to collectively as the “City Parish”) filed a peremptory exception raising the objection of no cause of action and a dilatory exception raising the objection of prematurity. On September 19, 2019, the City Parish's exceptions were denied. Thereafter, the City Parish answered Hebert's petition.

On October 7, 2021, Hebert filed a “Motion for Leave to File a Supplemental and Amended Third-Party Demand” amending the petition to allege that Mr. Cobb did not obtain the proper CCTV training before providing the sewer inspection reports.

On December 13, 2021, the trial court denied a motion for summary judgment filed by Rosehill against Hebert, and Hebert's findings of fact and conclusion of law were adopted by the court.² This included a finding that passing the CCTV inspection was not a subcontract requirement and Mr. Cobb “was not trained or certified to review CCTV camera inspections.” This judgment was eventually vacated by the trial court, and summary judgment was granted in favor of Rosehill finding, “no genuine issue of material fact, and Hebert was properly terminated by Rosehill for cause.”

On September 30, 2021, the City Parish filed a motion for summary judgment seeking dismissal of Hebert's claims with prejudice. The motion was granted in a judgment signed on February 3, 2022.³ The trial court adopted the City Parish's findings of fact and conclusions of law as its written reasons for judgment. The reasons for judgment by the trial court concluded that the City Parish had the authority to implement its sewer sag standard and CCTV sewer inspection policy and that the City Parish and Mr. Cobb had qualified immunity pursuant to La. R.S. 9:2798.1. Hebert appealed the judgment. On November 28, 2022, this court affirmed the trial court's grant of the City Parish's motion for summary judgment with one judge dissenting. Rosehill Construction, LLC v. Ted Hebert, LLC, 2022-0486 (La. App. 1st Cir. 11/28/22), 356 So.3d 1115.

On April 25, 2023, the City Parish filed a Motion for Sanctions for Frivolous Claim and to Tax Costs contending that Hebert sought and pursued a frivolous claim against a City Parish employee. Specifically, the City Parish argued that Hebert violated La. Code Civ. P. art. 863(B)(1)-(3). The City Parish contended that Hebert did not make a reasonable inquiry into the facts and law prior to signing the third-party demand, asserting the following two frivolous claims: (1) The City Parish failed to provide a standard or guideline for passing the CCTV camera inspections, and (2) Mr. Cobb acted outside of his authority by mandating the CCTV camera inspections.

The City Parish attached several documents to its motion to support its argument that “Hebert knew or should have reasonably] known the substantive information comprising its third-party demand was false or incorrect prior to its filing the incidental demand against the [City Parish].” The City Parish argued that after it was further clear that Hebert's allegations were false, Hebert “doubled down on its position.”

In response, Hebert filed a peremptory exception raising the objection of prescription with a memorandum attached in support of its prescription exception and in opposition to the City Parish's motion for sanctions and to fix court costs.

On August 21, 2023, the City Parish's motion and Hebert's exception came before the court for a hearing. During the hearing, the City Parish offered one witness related to its motion to tax court costs and introduced into evidence the documents attached to its motion. In support of its position that Hebert knew or should have known that its allegation that the City Parish failed to provide a standard or guideline for passing the CCTV camera inspection was false, the City Parish referenced a portion of the corporate deposition ⁴ of Hebert and its attachments, which included a document that was part of the project documents Hebert received before entering into the subcontract that provided the “acceptable sag limits.” In support of its position that Hebert knew that its allegation that the CCTV camera inspection was an unauthorized inspection method was false, the City Parish pointed to Trey Hebert's deposition testimony that a CCTV camera inspection performed by CES was used on a previous sewer project completed by Hebert. Additionally, the City Parish pointed to the subcontract, which provided in Hebert's scope of work that Hebert was to coordinate inspections with the City Parish, including a final camera inspection, and an email from Trey Hebert to Mr. Cobb when the sewer work was nearly complete requesting to “set the camera up as soon as we can.”

Hebert provided argument at the hearing but did not call any witnesses or introduce any evidence. At the close of the argument, the trial court stated “[t]he matter is under advisement” and asked both parties to “submit [their] judgments as [they] deem appropriate.”

On September 26, 2023, the trial court signed a judgment granting the City Parish's motion for sanctions and to tax costs. Hebert was ordered to pay $29,517.81 in costs and $167,162.50 in attorney fees as a sanction for a violation of Article 863(B). The judgment stated that “sanctions be issued against Hebert for violation of La. [Code Civ. P.] art. 863(B).” Additionally, the trial court overruled Hebert's exception raising the objection of prescription.⁵ It is from this judgment that Hebert appeals, contending that the trial court erred in granting the City Parish's motion for frivolous claim despite its prior written reasons finding otherwise. Specifically, Hebert contends the written reasons for the original denial of Rosehill's motion for summary judgment stated “[s]ince Cobb was not trained or certified to review CCTV video, he did not have the ability or authority to reject Hebert's sewer installation” and that although this judgment was later vacated, it established that a justiciable claim existed. Additionally, Hebert contends that the allegations made in its third-party demand contained evidentiary support for the facts it relied upon to assert its claim.

LAW AND ANALYSIS

Louisiana Code of Civil Procedure art. 863 prior to its amendment by 2025 La. Acts No. 250, § 2 provided:

A. Every pleading of a party represented by an attorney shall be signed by at least one attorney of record in his individual name, whose physical address and email address for service of process shall be stated. A party who is not represented by an attorney shall sign his pleading and state his physical address and email address, if the party has an email address, for service of process. If mail is not received at the physical address for service of process, a designated mailing address shall also be provided. A party or attorney may sign a pleading by electronic signature in accordance with Article 253.

B. Pleadings need not be verified or accompanied by affidavit or certificate, except as otherwise provided by law, but the signature of an attorney or party shall constitute a certification by him that he has read the pleading, and that to the best of his knowledge, information, and belief formed after reasonable inquiry, he certifies all of the following:

(1) The pleading is not being presented for any improper purpose, such as to harass, cause unnecessary delay, or needlessly increase the cost of litigation.

(2) Each claim, defense, or other legal assertion in the pleading is warranted by existing law or by a nonfrivolous argument for the extension, modification, or reversal of existing law.

(3) Each allegation or other factual assertion in the pleading has evidentiary support or, for a specifically identified allegation or factual assertion, is likely to have evidentiary support after a reasonable opportunity for further investigation or discovery.

(4) Each denial in the pleading of a factual assertion is warranted by the evidence or, for a specifically identified denial, is reasonably based on a lack of information or belief.

C. If a pleading is not signed, it shall be stricken unless promptly signed after the omission is called to the attention of the pleader.

D. If, upon motion of any party or upon its own motion, the court determines that a certification has been made in violation of the provisions of this Article, the court shall impose upon the person who made the certification or the represented party, or both, an appropriate sanction which may include an order to pay to the other party the amount of the reasonable expenses incurred because of the filing of the pleading, including reasonable attorney fees.

E. A sanction authorized in Paragraph D shall be imposed only after a hearing at which any party or his counsel may present any evidence or argument relevant to the issue of imposition of the sanction.

F. A sanction authorized in Paragraph D shall not be imposed with respect to an original petition which is filed within sixty days of an applicable prescriptive date and then voluntarily dismissed within ninety days after its filing or on the date of a hearing on the pleading, whichever is earlier.

G. If the court imposes a sanction, it shall describe the conduct determined to constitute a violation of the provisions of this Article and explain the basis for the sanction imposed.

Louisiana Code of Civil Procedure art. 863 imposes an obligation upon litigants and their attorneys to make an objectively reasonable inquiry into the facts and law. Carrollton Presbyterian Church v. Presbytery of S. La. Of Presbyterian Church (U.S.A.),2014-1214 (La. App. 1st Cir. 3/9/15), 172 So.3d 1, 8, writ denied, 2015-0682 (La. 5/22/15), 171 So.3d 257. Generally speaking, an award of attorney fees and costs under Article 863 is penal in nature and, as such, must be strictly construed. See SWC Services, LLC v. Echelon Const. Services, LLC, 2010-1113 (La. App. 1st Cir. 2/11/11), 56 So.3d 1254, 1257.

The article does not empower a trial court to impose sanctions simply because a particular argument or ground for relief is found to be unjustified; the failure to prevail does not trigger an award of sanctions. Article 863 is intended to be used only in exceptional circumstances; where there is even the slightest justification for the assertion of a legal right, sanctions are not warranted. Landry v. Landry, 2021-0337 (La. App. 1st Cir. 10/8/21), 331 So. 3d 351, 356, writ denied, 2022-00044 (La. 3/2/22), 333 So. 3d 835. Article 863 seeks to strike a balance between the need to curtail abuse of the legal system and the need to encourage creativity and vitality in the law. Lafourche Parish Council v. Breaux, 2002-1565 (La. App. 1st Cir. 5/9/03), 845 So.2d 645, 648. In determining whether a violation of Article 863 occurred, the trial court should avoid using hindsight and should test the signer's conduct at the time the pleading, motion, or other paper was submitted. Sanchez v. Liberty Lloyds, 95-0956 (La. App. 1st Cir. 4/4/96), 672 So.2d 268,272, writ denied, 96-1123 (La. 6/7/96), 674 So.2d 972.

In an appeal from a judgment imposing sanctions against a litigant under Article 863, we apply two distinct standards of review. The trial court's factual finding of a violation of Article 863 is reviewed under the “manifest error” or “clearly wrong” standard of review. See Lafourche Parish Council, 845 So.2d at 648. The trial court's determination of the type and/or amount of sanctions awarded is reviewed under the “abuse of discretion” standard of review. See Slaughter v. Bd. of Sup'rs of Southern University & Agr. & Mech. College, 2010-1114 (La. App. 1st Cir. 8/2/11), 76 So.3d 465, 469-70, writ denied, 2011-2112 (La. 1/13/12), 77 So.3d 970.

Article 863(G) mandates a court imposing sanctions to describe the conduct the court determined to constitute a violation of Article 863 and explain the basis for the sanctions imposed. Succession of Robinson, 2023-0302 (La. App. 1st Cir. 2/21/24), 384 So.3d 380, 383. See also La. R.S. 1:3, (“The word ‘shall’ is mandatory”). In this matter, at the close of the hearing, the trial court stated that the matter is under advisement and ordered both parties, “consistent with the ruling requirements,” to submit judgments. The judgment signed by the trial court provided that “sanctions be issued against Hebert for violation of La. [Code Civ. P.] art. 863(B)[.]” The trial court did not describe the conduct it determined to constitute a violation of Article 863.

Article 863 is intended to be used only in exceptional circumstances; where there is even the slightest justification for the assertion of a legal right, sanctions are not warranted. Moreover, the imposition of sanctions requires strict scrutiny. This matter has a lengthy and complicated procedural history with voluminous discovery wherein the City Parish's exception raising the objection of no cause of action was denied, and, although the grant of its motion for summary judgment was affirmed by this court, one judge dissented. In this complex matter, the trial court's failure to describe the conduct it determined to be a violation of Article 863 has prevented us from properly conducting an informed appellate review of its imposition of sanctions. Accordingly, we vacate the portion of the judgment that imposed sanctions and remand the matter to the trial court to describe the conduct it determined to constitute a violation of the provisions of the Article and to explain the basis for the sanction imposed as required by Article 863(G). See Succession of Robinson, 384 So.3d at 384.

CONCLUSION

For the foregoing reasons, the September 26, 2023 judgment is vacated insofar as it imposed sanctions, and the matter is remanded for the trial court to comply with La. Code Civ. P. art. 863(G). All costs of the appeal in the amount of $3239.00 are assessed to the City of Baton Rouge/East Baton Rouge Parish.

VACATED AND REMANDED.

FOOTNOTES

1.   Closed circuit television.

2.   As this court has noted, the best practice is for the trial judge to author for himself any reasons, including factual findings and legal conclusions. This approach gives the reviewing court the benefits of his thoughts and insights into the matter under consideration. Preparation of a judgment comprised of the stark, final determinations of a case is quite different from the presentation of a party's factual findings and legal conclusions as the inner thoughts of the judge. While these factual findings are relevant to Hebert's argument on appeal, this court does not place any real value on the written reasons drafted entirely by counsel for one of the parties. See King v. Allen Court Apartments II, 2015-0858 (La. App. 1st Cir. 12/23/15), 185 So.3d 835, 839, writ denied, 2016-0148 (La. 3/14/16), 189 So.3d 1069.

3.   The judgment was amended on August 10, 2022, to dismiss all claims against the City Parish and Mr. Cobb.

4.   Attending the corporate deposition for Hebert were the owner of Hebert, Ted Hebert; his son and employee, Trey Hebert; and Hebert's superintendent on the project, Phillip Woodward.

5.   On appeal, Hebert did not assign error to the trial court overruling its exception of prescription or the trial court's taxing of cost.

HESTER, J.