NON FLOOD PROTECTION ASSET MANAGEMENT AUTHORITY v. THE LATHAN COMPANY INC (2026)

This breach of contract matter arises from the restoration and construction of the New Orleans Lakefront Airport terminal building following Hurricane Katrina. Appellant, The Lathan Company, Inc. (“Lathan”) seeks review of the trial court's April 24, 2025 judgment sustaining AllGlass, LLC's (“AllGlass”) exception of peremption and dismissing Lathan's claims with prejudice. For the reasons to follow, we affirm the April 24, 2025 judgment.

FACTS AND PROCEDURAL HISTORY

On January 26, 2009, the Non-Flood Protection Asset Management Authority (“Management Authority”), division of Orleans Levee District, contracted with Lathan to repair and restore the New Orleans Lakefront Airport terminal building (“terminal building”) as a result of damages caused by Hurricane Katrina. Lathan subcontracted with AllGlass to install windows, aluminum storefronts, and an exterior slope glaze system. A Certificate of Substantial Completion recorded on November 10, 2010 after Lathan performed its work; however, several items within AllGlass's scope, including cleaning, replacing, and adjusting glass and hardware, remained unfinished. Subsequent complaints arose from the Management Authority regarding leaks in the windows AllGlass installed, which prompted AllGlass to conduct partial remedial work from 2014 to 2015.

On July 16, 2014, the Management Authority filed a petition for breach of contract against Lathan. On March 6, 2017, Lathan filed a third-party demand against AllGlass, alleging that pursuant to the subcontract AllGlass agreed to indemnify, hold harmless, and defend Lathan from all claims resulting from or arising out of AllGlass's work on the project. AllGlass filed an exception of peremption pursuant to La. R.S. 9:2772 on August 26, 2019, asserting that Lathan's third-party demand was asserted over six years after substantial completion and acceptance of the work by the owner had been recorded, thus Lathan's claims are preempted. The trial court overruled the exception in January 2020.

Thereafter, AllGlass filed a second exception of peremption on January 13, 2025. The trial court held a hearing on AllGlass's exception on April 3, 2025. At the conclusion of the hearing, the trial court held that Lathan's claims were perempted because the third-party demand was filed more than five years after the recordation of the Certificate of Substantial Completion. This appeal followed.

DISCUSSION

Lathan raises two assignments of error, which collectively asserts that the trial court incorrectly found that its third-party demand against AllGlass was perempted.¹

Standard of Review

An appellate court generally reviews a judgment granting a peremptory exception of peremption de novo, “because the exception raises a legal question and involves the interpretation of a statute.” Div. of Admin., Off. of Cmty. Dev.-Disaster Recovery Unit v. Porter, 2022-0250, p. 3 (La. App. 4 Cir. 9/7/22), 366 So. 3d 272, 274 (quoting Thrasher Const. v. Gibbs Residential, L.L.C., 2015-0607, p. 6 (La. App. 4 Cir. 6/29/16), 197 So.3d 283, 288-89). “If evidence was introduced, then this Court reviews the entire record for a determination of whether the trial court's factual conclusions were manifestly erroneous.” Id. at p. 3, 366 So.3d at 274 (citing Thrasher Const., 2015-0607, pp. 6-7, 197 So.3d at 289). “If the trial court's findings are reasonable in light of the entire record, then the appellate court may not reverse even though it would have weighed the evidence differently had it been sitting as the trier of fact.” Id. (quoting Thrasher Const., 2015-0607, p. 7, 197 So.3d at 289).

Peremptive Period

The peremptive statute at issue, La. R.S. 9:2772, implements the peremptive period for actions involving deficiencies in surveying, design, supervision, or construction of immovables or improvements thereon. La. R.S. 9:2772(A)(1) provides in pertinent part as follows:

A. Except as otherwise provided in this Subsection, no action, whether ex contractu, ex delicto, or otherwise, including but not limited to an action for failure to warn, to recover on a contract, or to recover damages, or otherwise arising out of an engagement of planning, construction, design, or building immovable or movable property which may include, without limitation, consultation, planning, designs, drawings, specification, investigation, evaluation, measuring, or administration related to any building, construction, demolition, or work, shall be brought against any person performing or furnishing land surveying services, as such term is defined in R.S. 37:682, including but not limited to those services preparatory to construction, or against any person performing or furnishing the design, planning, supervision, inspection, or observation of construction or the construction of immovables, or improvement to immovable property, including but not limited to a residential building contractor as defined in R.S. 37:2150.1:

(1)(a) More than five years after the date of registry in the mortgage office of acceptance of the work by owner.

(b) If no such acceptance is recorded within six months from the date the owner has occupied or taken possession of the improvement, in whole or in part, more than five years after the improvement has been thus occupied by the owner.

“This prohibition includes third-party demands; the peremptive period ‘shall extend to every demand, whether brought by direct action or for contribution or indemnity or by third party practice ․’ ” Thrasher Const., Inc., 2015-0607, p. 10, 197 So.3d at 290. (citing La. R.S. 9:2772(B)(3)).

Here, AllGlass asserted in its exception of peremption that Lathan's third-party demand is perempted because it was filed more than five years after the date the Certificate of Substantial Completion was recorded. AllGlass further asserted that although it was a subcontractor of Lathan, it is considered a contractor on a public works project. AllGlass additionally argued that it was undisputed that the Certificate of Substantial Completion for the project was recorded on November 10, 2010, and Lathan did not file its third-party demand until March 6, 2017. Additionally, AllGlass refers to Plaquemine Parish Gov't v. Burke- Kleinpeter, Inc., unpub., 2015-1152 (La. App. 4 Cir. 3/9/16), 2016 WL 915393, in support of its contention that although a project may require a list of items to be completed, it does not prevent a project from reaching substantial completion.

In opposition, Lathan argued that the peremptive period did not begin until the terminal building was ready for occupancy. Lathan further argued that the Certificate of Substantial Completion did not trigger the peremptive period under La. R.S. 9:2772 because the Certificate of Substantial Completion expressly excluded AllGlass's work. Lathan also asserted that the facts of this case are inapposite to the decision in Plaquemine Parish Gov't because the Certificate of Substantial Completion in that matter did not include a punch-list or incomplete and defective work as in this matter.

In Plaquemine Parish Gov't, this court determined whether the parish government timely filed suit against a contractor. The contract between the parish government and the contractor provided that the design engineer had the authority to select the date of substantial completion. Id. at p. 3. The design engineer set a date for substantial completion for April 6, 2010. The parish government executed a notice of acceptance on August 5, 2010. In opposition to the contractor's exception of peremption, the parish government argued that the date of substantial completion was not April 6, 2010, but July 26, 2010, the date the project manager recommended acceptance of the work. Id.

The Plaquemine Parish Gov't court noted that the record revealed that the selection of the substantial completion date did not terminate or complete all existing obligations owed amongst the parties, and that the parish government admitted that a general contractor continued to work on change orders and other items on the punch-list even after the substantial completion date selection. Id. at p. 4. The Court acknowledged “the right to select the substantial completion date does not deprive [the parish government] or any public entity of the right to file suit against the contractor for any perceived failure to perform the contract terms. The date's selection simply limits the right to file suit against the contractor to within five years of the date of substantial completion.” Id. at p. 5.

In the instant matter, we find Lathan's argument that the inclusion of punch-list items assigned to AllGlass in the Certificate of Substantial Completion rendered the owner's acceptance as incomplete, thereby delaying the peremptive period until occupancy, to be misplaced. The presence of punch-list items does not negate substantial completion or the owner's recorded acceptance of the work. Rather, punch-list items reflect minor corrective or incomplete work remaining after substantial completion.

As this Court recognized in Plaquemine Parish Gov't, the continuation of work on punch-list items after substantial completion does not postpone the commencement of the five-year peremptive period under La. R.S. 9:2772. The statute is triggered by the recorded acceptance of the work, not by the completion of every remaining contractual obligation. In light of the November 10, 2010 filing of the Certificate of Substantial Completion and Lathan filing its third-party demand against AllGlass on March 6, 2017, we find that Lathan's third-party claims against AllGlass are perempted under La. R.S. 9:2772.

CONCLUSION

For the aforementioned reasons, we affirm the trial court's April 24, 2025 judgment sustaining AllGlass's exception of peremption and dismissing Lathan's claims with prejudice.

AFFIRMED

FOOTNOTES

1.   Lathan also argues that the trial court erred in granting AllGlass's second exception of peremption when it had previously denied AllGlass's exception on the same facts and argument. Lathan contends that the second exception of peremption re-urges the same law and facts as the first exception. The doctrine of res judicata prohibits re-litigation of the same issues in a subsequent action. La. R.S. 13:4231. It does not prohibit “a party in the same action from re-urging an exception.” Landry v. Blaise, Inc., 2002-0822, p. 3 (La. App. 4 Cir. 10/23/02), 829 So.2d 661, 664. A peremptory exception may be urged at any stage of the proceeding. La. C.C.P. art. 928. Additionally, “[a] party may re-urge a peremptory exception after a denial of the exception.” Landry, 2002-0822, p. 3, 829 So.2d at 664 (internal citation omitted). Accordingly, the trial court was allowed to consider the second peremptory exceptions filed by AllGlass.

JUDGE SANDRA CABRINA JENKINS

BELSOME, C. J., DISSENTS AND ASSIGNS REASONS.