BLOUNT BROS CONSTRUCTION LLC v. STATE OF LOUISIANA DEPARTMENT OF TRANSPORTATION AND DEVELOPMENT FIDELITY DEPOSIT COMPANY OF MARYLAND ZURICH AMERICAN INSURANCE COMPANY JANICE WILLIAMS AND MIKE VOSBURG (2026)

The issue presented in this appeal is whether sovereign immunity bars a claim for unjust enrichment against the State of Louisiana, Department of Transportation and Development (“DOTD”). After review, we find the trial court properly sustained DOTD's peremptory exception of lack of subject matter jurisdiction but, after finding it lacked jurisdiction, erred by sustaining DOTD's peremptory exception of no cause of action. Thus, the judgment is affirmed in part and reversed in part.

FACTS AND PROCEDURAL HISTORY

In October 2013, Blount Bros. Construction, LLC entered a contract with DOTD for the construction of a state project in Desoto Parish. Since the project was a public work, Blount Bros. was required to furnish a performance and payment bond, which it obtained by entering a surety agreement with Fidelity & Deposit Company of Maryland (“F&D”). For reasons not pertinent to this appeal, the project was not complete by October 2016. At that time, DOTD defaulted Blount Bros., and F&D took over completion of the project.

In October 2017, Blount Bros. filed suit against DOTD and F&D, seeking damages for DOTD's purported breach of contract and F&D's alleged breach of the surety agreement.² Blount Bros. pertinently argued that F&D knew or should have known that DOTD breached the construction contract, that Blount Bros. had defenses to DOTD's claims, and that Blount Bros. was not in default; nevertheless, F&D took over completion of the project to Blount Bros.’s detriment.

F&D answered the suit, asserted a reconventional demand against Blount Bros., and filed a third-party demand against Blount Holdings, Inc.; Blount Bros. Construction, Inc.; KHCD Properties, LLC; Aggregate Properties, LLC; and C. Denzil Blount (collectively, “Blount Indemnitors”).³ The third-party demand was premised on a June 2011 “Agreement of Indemnity” between the Blount Indemnitors and F&D. In the agreement, the Blount Indemnitors agreed to indemnify F&D from and against any liability for losses or expenses sustained or incurred by F&D by reason of having executed or procured the execution of surety bonds to Blount Bros. In its third-party demand, F&D alleged that the Blount Indemnitors are liable to it pursuant to the Agreement of Indemnity for all losses and expenses incurred in connection with the project. The Blount Indemnitors answered the third-party demand, admitted they are parties to the Agreement of Indemnity, but denied indemnity is owed to F&D.

In October 2023, Blount Bros. filed a first amended and supplemental petition, wherein it alleged for the first time that its contract with DOTD is an absolute nullity due to DOTD's failure to comply with public bid laws. At the same time, the Blount Indemnitors amended their answer to F&D's third-party demand, pertinently asserting Blount Bros.’s contract with DOTD is an absolute nullity.

The Blount Indemnitors also filed a “third-party demand” against DOTD, alleging that, if they are liable to F&D, they are entitled to subrogation to all rights of F&D against DOTD.⁴ The Blount Indemnitors also asserted that, if they are liable to F&D, they are entitled to “implied indemnity” from DOTD under the theory of unjust enrichment. In response, DOTD raised a peremptory exception of no cause of action, asserting the third-party demand failed to state a cause of action for legal or conventional subrogation; however, DOTD did not include argument as to the Blount Indemnitors’ unjust enrichment cause of action.⁵ See La. C.C.P. art. 927(A)(5). The trial court sustained DOTD's exception of no cause of action in November 2024, seemingly as to all claims asserted in the third-party demand, and gave the Blount Indemnitors 15 days to amend their petition to attempt to state a cause of action. See La. C.C.P. art. 934.

Shortly thereafter, the Blount Indemnitors filed their first amended third-party demand, wherein they omitted a cause of action for subrogation but reurged their claim for unjust enrichment. DOTD again filed numerous exceptions, including peremptory exceptions of lack of subject matter jurisdiction and no cause of action. See La. C.C.P. art. 927(A)(5) and (8). DOTD argued the third-party demand failed to set forth facts sufficient to establish all elements of an unjust enrichment cause of action.

In its exception of lack of subject matter jurisdiction, DOTD argued it was entitled to sovereign immunity, relying on Canal/Claiborne, Ltd. v. Stonehedge Development, LLC, 2014-0664 (La. 12/9/14), 156 So.3d 627. There, the Louisiana Supreme Court held that the plaintiff's quasi-contractual claim for unjust enrichment did not fall within the scope of the waiver of sovereign immunity from suit and liability in contract or for injury to person or property found in La. Const. Art. XII, Sect. 10(A). The supreme court further found the language in La. R.S. 36:471(A), establishing the defendant, the Department of Children and Family Services, as “a body corporate with the power to sue and be sued[,]” did not constitute a “measure authorizing” waiver of suit and liability in all claims other than suit in contract or for injury to person or property pursuant to La. Const. Art. XII, Sect. 10(B). Therefore, the trial court was without subject matter jurisdiction to entertain the plaintiff's claim for unjust enrichment. Canal/Claiborne, Ltd., 156 So.3d at 640.

The Blount Indemnitors argued in opposition that DOTD failed to particularize the basis for its exception of no cause of action. They further argued that Canal/Claiborne is distinguishable because it did not analyze DOTD's enabling statute, La. R.S. 48:22. The Blount Indemnitors asserted that jurisprudence predating Canal/Claiborne, wherein La. R.S. 48:22 was discussed, supports a finding that DOTD does not enjoy sovereign immunity as to their claim for unjust enrichment.

In a judgment signed on May 6, 2025, the trial court sustained DOTD's exception of lack of subject matter jurisdiction and dismissed the Blount Indemnitors’ claim for unjust enrichment, with prejudice. The same judgment also sustained DOTD's exception of no cause of action and dismissed all claims asserted by the Blount Indemnitors with prejudice. The remaining exceptions urged by DOTD were dismissed as moot.

ISSUES ON APPEAL

The Blount Indemnitors filed this appeal, urging the trial court erred by sustaining DOTD's exception of lack of subject matter jurisdiction and finding that claims against DOTD for unjust enrichment are precluded by sovereign immunity. They further assert the trial court erred by sustaining DOTD's exception of no cause of action after ruling that it lacked subject matter jurisdiction over their claims against DOTD. Finally, the Blount Indemnitors assert the trial court erred by failing to give them an opportunity to amend their third-party demand.

Sovereign Immunity

Subject matter jurisdiction is the legal power and authority of a court to hear and determine a particular class of actions or proceedings based upon the object of the demand, the amount in dispute, or the value of the right asserted. La. C.C.P. art. 2. Subject matter jurisdiction is created by the constitution or by legislative enactment; it cannot be conferred or waived by the parties. See La. C.C.P. art. 3; McCann v. McCann, 2011-2434 (La. 5/8/12), 93 So.3d 544, 547. The defense of sovereign immunity is a challenge to the exercise of a state court's subject matter jurisdiction. State v. Murphy Cormier General Contractors, Inc., 2015-111 (La. App. 3 Cir. 6/3/15), 170 So.3d 370, 375. Whether a court has subject matter jurisdiction is reviewed on appeal under the de novo standard of review. Lassalle v. Napoleon, 2022-0460 (La. App. 4 Cir. 12/20/22), 356 So.3d 74, 77.

“Sovereign immunity bars a court from exercising jurisdiction in suits against the state unless the state has elected to waive its immunity.” Lasalle, 356 So.3d at 77. Louisiana Constitution Article XII, Section 10(A) pertinently provides that a state agency shall not be immune from suit and liability in contract or for injury to person or property. It is well-settled in our jurisprudence that a claim of unjust enrichment under La. C.C. art. 2298 is quasi-contractual. Canal/Claiborne, Ltd., 156 So.3d at 633. Thus, the unjust enrichment claim asserted by the Blount Indemnitors does not fall within the scope of the waiver of sovereign immunity from suits in contract or tort found in La. Const. Art. XII, Sect. 10(A). Canal/Claiborne, Ltd., 156 So.3d at 634. Accordingly, unless the Blount Indemnitors’ claim for unjust enrichment was otherwise authorized by the legislature, the trial court properly sustained DOTD's exception of lack of subject matter jurisdiction.

Louisiana Constitution Article XII, Section 10(B) pertinently provides that the legislature may authorize other suits against a state agency. As the supreme court did in Canal/Claiborne, we consider DOTD's enabling statute, La. R.S. 48:22, to determine whether the legislature authorized other suits against DOTD. Louisiana Revised Statutes 48:22 states,

The department has all of the rights, powers, and immunities incident to corporations. It may acquire, own, administer, alienate, and otherwise dispose of all kinds of property, movable and immovable, tangible and intangible; contract; adopt, alter, or destroy an official seal; sue and be sued, implead, and be impleaded. (Emphasis added.)

The supreme court in Canal/Claiborne, Ltd., 156 So.3d at 639-40, expressly considered the “sue and be sued” language in La. R.S. 36:471 (A) regarding the Department of Children and Family Services and unequivocally held “the ‘power to sue and be sued’ given a state agency by virtue of the statute creating that agency does not by itself effect a general waiver of immunity with regard to all suits within the meaning of [La. Const.] Art. XII, Sect. 10(B)[.]” The supreme court explained that the “sue and be sued language” deliberately chosen by the legislature serves an important function: it specifies that governmental units created under statute may be designated as legal entities distinct from the State for litigation purposes. Canal/Claiborne, Ltd., 156 So.3d at 639.

Like the Department of Children and Family Services at issue in Canal/Claiborne, DOTD performs important public functions, and La. R.S. 48:22 enables DOTD to bring suit in performance of its duties and to be sued as a separate legal entity for negligence or other tortious conduct or for breach of contract instead of the aggrieved party having to sue the entire State of Louisiana for redress. The supreme court found no indication that the legislature, by designating a state agency as a separate legal body with the power to sue and be sued, also meant to broadly waive immunity and liability from suit of any kind, particularly in light of the specifically articulated waiver of immunity for state agencies found in La. Const. Art. XII, Sects. 10(A) and (B) in the 1974 Constitution, which retains sovereign immunity for suits other than those in contract or tort. Canal/Claiborne, Ltd., 156 So.3d at 640.

Canal/Claiborne was decided over a decade ago and the legislature has not amended La. R.S. 36:471 to address the supreme court's interpretation of the “sue and be sued” language. The legislature has likewise not amended La. R.S. 48:22 to clarify that the “sue and be sued language” is, in fact, intended to be a waiver of immunity in other suits against DOTD, including suits for unjust enrichment. See Canal/Claiborne, Ltd. 156 So.3d at 640 (recognizing it is within the province of the legislature to say whether establishing a state agency as a “body corporate with the power to sue and be sued” demonstrates an intent to broadly waive immunity from all suits based on any legal theory, as well as liability, within the meaning of La. Const. Art. XII, Sect. 10(B)).

The cases cited by the Blount Indemnitors were decided prior to the adoption of the 1974 Constitution, when courts were grappling with whether the 1960 amendment to the 1921 Constitution waived sovereign immunity for both liability and immunity from suit. See Reymond v. State Through Department of Highways, 255 La. 425, 438, 231 So.2d 375, 380 (1970) and Hamilton v. City of Shreveport, 247 La. 784, 787, 174 So.2d 529, 530 (1965) (finding the 1960 constitutional amendment served as an all-inclusive, all-purpose waiver of immunity from suit). Considering the clear language of La. Const. Art. XII, Sect. 10(B), we find the cases cited by the Blount Indemnitors are inapplicable.

The Blount Indemnitors also assert that Canal/Claiborne is distinguishable because, here, DOTD purportedly violated prohibitory law, resulting in the absolute nullity of the contract between DOTD and Blount Bros.⁶ We find no merit in this assertion. The contract at issue is between Blount Bros. and DOTD; no contract exists between the Blount Indemnitors and DOTD.⁷ A judicial determination that the Blount Bros./DOTD contract is an absolute nullity will not create a cause of action in favor of the Blount Indemnitors for unjust enrichment where such suits are barred by sovereign immunity. See La. Const. Art. XII, Sects. (A) and (B); Canal/Claiborne, Ltd., 156 So.3d at 640. Thus, we find the trial court properly sustained DOTD's exception of lack of subject matter jurisdiction.

No Cause of Action

The Blount Indemnitors’ amended third-party demand sets forth a single cause of action for unjust enrichment against DOTD. Since the trial court determined it lacked subject matter jurisdiction to consider this claim, it erred by sustaining DOTD's exception of no cause of action. We find merit in the Blount Indemnitors’ second assignment of error, and reverse the portion of the May 6, 2025 judgment that sustained DOTD's exception of no cause of action.

Amendment

In their final assignment of error, the Blount Indemnitors assert the trial court erred by failing to give them an opportunity to amend their third-party demand. Louisiana Code of Civil Procedure article 934 states that, when the grounds of the objection pleaded by the peremptory exception may be removed by amendment of the petition, the judgment sustaining the exception shall order such amendment within the delay allowed by the court. However, if the grounds of the objection raised through the exception cannot be so removed, the action, claim, demand, issue, or theory shall be dismissed.

Article 934 does not permit amendments to a petition that change the substance of the original claims. Gulf Production Co., Inc. v. Halliburton Energy Services, Inc., 2023-1111 (La. App. 1 Cir. 8/6/24), 394 So.3d 856, 868. Thus, the Blount Indemnitors cannot amend their third-party demand to state a new cause of action, and there are no facts, which may be alleged, that would create a cause of action for unjust enrichment against DOTD. Amendment would be an impermissible vain and useless act. Gulf Production Co., Inc., 394 So.3d at 868.⁸

CONCLUSION

We affirm the portion of the May 6, 2025 judgment that sustained the peremptory exception of lack of subject matter jurisdiction filed by the State of Louisiana, Department of Transportation and Development (DOTD) and dismissed the claim for unjust enrichment against DOTD urged by Blount Holdings, Inc.; Blount Bros. Construction, Inc.; KHCD Properties, LLC; Aggregate Properties, LLC; and C. Denzil Blount. We further affirm the portion of the May 6, 2025 judgment that dismissed as moot DOTD's exceptions of vagueness, no right of action, and prescription. We reverse the portion of the May 6, 2025 judgment that sustained the peremptory exception of no cause of action filed by DOTD.

All costs of this appeal are assessed against Blount Holdings, Inc.; Blount Bros. Construction, Inc.; KHCD Properties, LLC; Aggregate Properties, LLC; and C. Denzil Blount.

AFFIRMED IN PART; REVERSED IN PART.

FOOTNOTES

2.   We do not discuss parties not pertinent to this appeal or claims that were asserted but dismissed.

3.   F&D entitled its claim against the Blount Indemnitors as a “reconventional demand.” However, the Blount Indemnitors were not parties to the litigation before being added by F&D; therefore, F&D's claim against the Blount Indemnitors is a third-party demand. See La. C.C.P. art. 1111.

4.   The Blount Indemnitors entitled their claims against DOTD as a “third-party demand,” and the parties refer to these claims as such on appeal. However, DOTD was a defendant at the time the Blount Indemnitors, also defendants, asserted claims against it. Thus, the claim against DOTD is a cross-claim pursuant to La. C.C.P. art. 1071. Nevertheless, to avoid confusion, we refer to the claims as a “third-party demand.”

5.   DOTD also raised a dilatory exception of prematurity and peremptory exceptions of no right of action and prescription, which the trial court overruled. See La. C.C.P. arts. 926(A)(1) and 927(A)(1) and (6).

6.   The Blount Indemnitors also argue that DOTD's enabling statute, La. R.S. 48:22, is broader than the statute analyzed in Canal/Claiborne. However, they do not cite any particular provision or phrase in La. R.S. 48:22 that purports to waive immunity from other suits, nor do they explain why Canal/Claiborne’s analysis of the “sue and be sued” language does not equally apply to the “sue and be sued” language in La. R.S. 48:22.

7.   For this reason, we find no merit in the Blount Indemnitors’ reliance on La. R.S. 38:2191(E), which pertinently states that a declaration that a public works contract is null and void as being contrary to the provisions of La. R.S. 38:2211, et seq. shall not affect amounts due and payable under the contract, including overhead and profit, for the work performed by or on behalf of the contractor. No amounts are due to the Blount Indemnitors under the contract, nor have they performed work under the contract with DOTD.

8.   Additionally, the Blount Indemnitors did not ask the trial court for an opportunity to amend their petition to cure any deficiencies. Therefore, the issue is waived. See Martin v. Board of Adjustment Through Chairman, 2023-0658 (La. App. 1 Cir. 2/23/24), 387 So.3d 17, 22 n.9

HAGGERTY, J.