The opinion
TKTMJ, INC. * NO. 2023-CA-0787
VERSUS *
COURT OF APPEAL
THE SEWERAGE & WATER *
BOARD OF NEW ORLEANS FOURTH CIRCUIT
*
STATE OF LOUISIANA
*******
APPEAL FROM
CIVIL DISTRICT COURT, ORLEANS PARISH
NO. 2016-11900, DIVISION “F-14”
Honorable Jennifer M Medley,
******
Judge Daniel L. Dysart
******
(Court composed of Judge Daniel L. Dysart, Judge Tiffany Gautier Chase, Judge
Nakisha Ervin-Knott)
Scott Hedlund
TKTMJ, INC
100 Harbor Circle
New Orleans, LA 70126
COUNSEL FOR PLAINTIFF/APPELLANT
John M. Landis
Nicholas J. Wehlen
STONE PIGMAN WALTHER WITTMANN L.L.C.
909 Poydras Street, Suite 3150
New Orleans, LA 70112-4042
COUNSEL FOR DEFENDANT/APPELLEE
AFFIRMED
APRIL 25, 2024
DLD The plaintiff, TKTMJ, Inc. (“TKTMJ”), appeals the trial court’s judgment
TGC
NEK denying its motion for post-judgment relief against the defendant, the Sewerage
and Water Board of New Orleans (“S&WB”). For the reasons that follow, we
affirm the trial court’s judgment.
FACTS AND PROCEDURAL HISTORY
This case arises out of a breach of contract action brought by TKTMJ
against the S&WB regarding two contracts that the S&WB had entered into with
TKTMJ, as general contractor, for the replacement of two sewerage pumping
stations. The S&WB filed a reconventional demand against TKTMJ and a third-
party demand against TKTMJ’s surety, Travelers Casualty and Surety Company of
America. The trial court rendered a judgment in favor of TKTMJ and its surety
and against the S&WB, awarding TKTMJ $1,719,808.24 in damages. The trial
court also dismissed the defendant’s reconventional and third-party demands. On
appeal, this Court reversed in part, amended in part, and affirmed as amended.
TKTMJ, Inc. v. The Sewerage and Water Bd. of New Orleans, 2020-0154 (La.
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App. 4 Cir. 12/16/20), 366 So.3d 276. This Court awarded the S&WB $92,000.00
in its reconventional and third-party demands against TKTMJ and Travelers, and
reduced TKTMJ’s damage award to $1,555,064.03. Id. TKTMJ filed an
application for rehearing, asking that these amounts be offset so that TKTMJ
would not be required to pay the $92,000.00 to the S&WB. This Court granted the
application for rehearing with a footnote stating: “Counsel for TKTMJ certifies
that S&WB has no opposition to this Court, clarifying the amendment to the
judgment pursuant to La. C.C. art. 1893.”1 The practical effect was that TKTMJ
did not have to pay the $92,000.00 monetary judgment against it due to the larger
monetary judgment that the S&WB owed to TKTMJ and its effect was specific to
this particular judgment.
On July 20, 2023, TKTMJ filed a motion for post-judgment relief seeking an
order from the court that would have the effect of preventing any interruption in
service to TKTMJ by the S&WB for failure to timely pay an invoice for water and
sewer service as such obligation was extinguished by operation of law through
compensation. A hearing took place on August 31, 2023, where the trial court
denied the motion. A written judgment was issued on September 14, 2023. It is
from this judgment that TKTMJ now appeals.
1 La. C.C. art. 1893 provides:
Compensation takes place by operation of law when two persons owe to each other sums
of money or quantities of fungible things identical in kind, and these sums or quantities are
liquidated and presently due.
In such a case, compensation extinguishes both obligations to the extent of the lesser
amount.
Delays of grace do not prevent compensation.
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DISCUSSION
On appeal, TKTMJ raises the following assignments of error: (1) the trial
court erred in failing to apply compensation to offset liquidated obligations; (2) the
trial court erred in failing to apply the law of this case/res judicata; and (3) the trial
court erred in considering the S&WB’s numerous other outstanding judgments and
bond rating as a factor in the application of compensation.
“This case requires us to interpret Louisiana constitutional articles and
statutes relative to the enforcement of money judgments against a political
subdivision of the state. Because the proper interpretation of a statute is
necessarily a question of law, we apply a de novo standard of review.” Newman
Marchive P’ship, Inc. v. City of Shreveport, 2007-1890, p. 3 (La. 4/8/08), 979
So.2d 1262, 1265; see also Holly & Smith Architects, Inc. v. St. Helena
Congregate Facility, Inc., 2006-0582, p. 9 (La. 11/29/06), 943 So.2d 1037, 1045.
The object of TKTMJ’s obligation to the S&WB is to pay for the S&WB’s
provision of water and sewer services to TKTMJ, and the object of the S&WB’s
obligation is the judgment that TKTMJ seeks to enforce through compensation.
Considering that the S&WB is a political subdivision of the State of Louisiana, the
object of TKTMJ’s obligation to the S&WB (the provision of water and sewer
service) is constitutionally exempt from seizure under La. Const. art. 12, §10(C).
In pertinent part, La. Const. art. 12, §10(C) states:
No judgment against the state, a state agency, or a political
subdivision shall be exigible, payable or paid except from funds
appropriated therefore by the legislature or by the political subdivision
against which the judgment is rendered.
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In addition, La. R.S. 13:5109(B)(2) provides:
Any judgment rendered in any suit filed against the state, a state
agency, or a political subdivision, or any compromise reached in favor
of the plaintiff or plaintiffs in any such suit shall be exigible, payable
and paid only out of funds appropriated for that purpose by the
legislature, if the suit is filed against the state or a state agency, or out
of funds appropriated for that purpose by the named political
subdivision.
The S&WB has not appropriated any funds for payment of TKTMJ’s
judgment against it, and according to La. Const. art. 12 §10(C) and La. R.S.
13:5109(B)(2), TKTMJ cannot obtain payment through any other means, including
through compensation by operation of law. Allowing TKTMJ to receive free water
and sewerage service through compensation by operation of law would constitute
payment of the judgment, and that is expressly prohibited.
Regarding TKTMJ’s law of the case argument, there is nothing in the record
to support its contention that the S&WB agreed to the application of compensation
in any context other than that presented to this Court by the prior application for
rehearing. The application did not request or even mention applying compensation
in any other context. It was strictly limited and applied to an offset regarding the
respective monetary damage awards from the prior judgment that were at issue in
the rehearing before this Court. There was no agreement by the parties that it
would apply in any other situation or dispute between them. In any event, “[t]he
law of the case doctrine is a discretionary guide that will not be applied inflexibly.”
Sewell v. Sewerage and Water Bd. of New Orleans, 2020-0381, p. 14 (La. App. 4
Cir. 2/24/21), 365 So.3d 583, 594. “It will not be applied when the underlying,
operative facts upon which the court’s prior decision was based have changed.” Id.
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CONCLUSION
For the above and foregoing reasons, we affirm the trial court’s judgment
denying TKTMJ’s motion for post-judgment relief.
AFFIRMED
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