Opinion ID: 701273
Heading Depth: 2
Heading Rank: 2

Heading: Condition of the Building After the Hurricane

Text: 15 The building's roof suffered the most hurricane damage. Again, the defendants argue the court credited and discredited the wrong testimony. The record reveals that Wayne Labiche, a civil engineering consultant, found the cost to repair prior to the hurricane would have been $5000.00. He explained that he found two leaks in the roof and credited some interior water damage to those leaks. Labiche, however, testified that after that the roof membrane had blown off during the storm. Charles Ivey, an expert for the defense, testified that none of the damage to the building was caused by the storm and that the roof's membrane was missing prior to the hurricane. Labiche, in contradiction, testified that if the roof had been damaged prior to the storm as Ivey testified, there would have been an extensive and obvious decay of lumber in the interior of the building which there was now. Further, Robert Billeaud, an estimator for J.B. Mouton & Sons, also opined that the damage was relatively recent or there would have been more decay. The district court discredited Ivey's testimony because it was shown to be completely inconsistent with the testimony of Patrick Caffery, who inspected the building just days before the sale to Real Asset and found that the roof membrane was there. Richard Morgan, the roofing estimator who later installed the temporary roof, also testified that the roof's membrane had blown off during the storm. He explained that the roof decking had not rotted through and there was no roofing membrane which had dropped through the holes in the roof. 16 There is substantial evidence to support the district court's finding that the damage caused by the storm and subsequent deterioration was in excess of the policy limits. When the cost to repair exceeds the value of the property, the property is considered a total loss. See Dumond v. Mobile Ins. Co., 309 So.2d 776, 778 (La.Ct.App. 3d Cir.1975); Bennett v. Emmco Ins. Co., 215 So.2d 518 (La.Ct.App. 4th Cir.1968). The testimony established that the actual cash value of the building prior to the hurricane was in a range of $160,000.00 to $180,441.00. To replace the building before depreciation it was estimated it would cost in the range from $221,730.00 to $601,470.00. We cannot say that the district court's finding that the building was a total loss was clearly erroneous. 17 Although the evidence supports the district court's finding that the building was a total loss, we find that the court failed to consider the extent of the damage caused by the plaintiff's own failure to mitigate losses. The building was damaged not only by the storm but also by the subsequent deterioration it suffered as a result of being left open to the weather without a roof for four months. If a building escalates into a total loss due in part to the plaintiff's own failure to mitigate, the plaintiff is not entitled to receive the full value of the loss under the policy limits. The loss shall be reduced by the extent of damage attributable to the plaintiff because of failure to mitigate damages and prevent further decay of the building. The district court noted in its memorandum denying a new trial: [D]espite the recommendation of their own adjuster, the roof was not repaired and no money was tendered to the insured for repair to the roof. The building quickly deteriorated into a total loss from complete interior exposure to rain, humidity and sun. The district court found mitigation was not a substantial issue because the plaintiff's duty to mitigate terminated when the insurer received the recommendation from their adjuster that $12,000.00 (less the deductible) should have been tendered. We find, however, no legal support for the proposition that an insured's duty to mitigate terminates when the insurer breaches his duty to timely settle a claim. 11 Under Louisiana law it is clear a plaintiff has a duty to do what it can to mitigate losses. See Eaves v. Norwel, 570 So.2d 123, 129 (La.Ct.App. 3d Cir.1990); Kuck v. City of New Orleans, 531 So.2d 1142, 1144 (La.Ct.App. 4th Cir.1988); Crawler Supply Co. v. Bituminous Casualty Corp., 391 So.2d 1223 (La.Ct.App. 1st Cir.1980); Van Rossum v. St. Paul Mercury Ins. Co., 147 So.2d 100 (La.Ct.App. 2d Cir.1962). The purpose of the duty is for the insured to preserve the property when the property is not a total loss and reasonable efforts would maintain its condition and value. Crawler, 391 So.2d at 1226. Further, La.Code Civ.Ann. art. 2002 provides that an obligee must make reasonable efforts to mitigate damage caused by the obligor's failure to perform. 18 The record reveals the Real Asset notified the insurers of the loss on August 31, 1992, a few days after the hurricane. The insurers responded within a few days and sent CIA adjuster Harris Kenley to evaluate the damage. Approximately two weeks later Dave Costa, another adjuster for CIA, contacted Tommy Hebert and notified Hebert that he would be in charge of the claim. During this phone call, Hebert asked for a temporary roof, but Costa replied he did not have the authority to initiate such a measure. In a follow up letter Costa recommended that Hebert take all necessary measures to protect the building while authorization was pending. Hebert did not. On November 13, 1992, two and a half months after the hurricane and a month and a half since Hebert requested a temporary roof, the insurers authorized the installment of a temporary roof. Up to this point neither the insured nor the insurer had taken any action to physically protect the building from further damage. On December 24, 1992, the temporary roof was installed. Throughout the course of attempting to ascertain the extent of damages, it appears the plaintiff did not make any reasonable efforts to protect the building from further deterioration. For instance, it may have been reasonable under the circumstances for the plaintiff to at least have temporarily, and without great expense, put a tarp over the damaged roof. These possible efforts were not explored in the record. The district court correctly found that the evidence supported the finding that the building was a total loss. We find, however, that the plaintiff had a duty to mitigate losses and prevent unnecessary subsequent damage. The extent of damages that can be shown to have been caused by the plaintiff's failure to mitigate should reduce the damages accordingly. The issue of damages recoverable under the policy will be remanded for that purpose. The defendant bears the clear burden to show what extent of damages should be mitigated. Perrette v. City of Slidell, 465 So.2d 63 (La.Ct.App. 1st Cir.1985); Reeves v. Travelers Ins. Co., 329 So.2d 876 (La.Ct.App. 2d Cir.1976).