
    James V. ST. RAYMOND v. The CITY OF NEW ORLEANS, et al.
    No. 99-CA-2438.
    Court of Appeal of Louisiana, Fourth Circuit.
    May 17, 2000.
    
      Regina S. Wedig, Donald E. Theriot, Bordelon, Hamlin & Theriot, New Orleans, Louisiana, Counsel for Plaintiff/Appellant.
    Lynnette F. Judge, New Orleans, Louisiana and Marc G. Shachat, Chaffe, McCall, Phillips, Toler & Sarpy, New Orleans, La, Counsel for Intervenor/Appellee.
    Evelyn G. Pugh, Deputy City Attorney, Nolan P. Lambert, Chief of Civil Litigation, Mavis S. Early, City Attorney, New Orleans, Louisiana, Counsel for Defen-danVAppellee.
    Court composed of Judge STEVEN R. PLOTKIN, Judge MIRIAM G. WALTZER, Judge JAMES F. McKAY, Judge DENNIS R. BAGNERIS, Sr., Judge MICHAEL E. KIRBY.
   J^PLOTKIN, Judge.

On consideration of the application for rehearing filed by plaintiff James V. St. Raymond, we recall our original opinion affirming the trial court judgment that denied Mr. St. Raymond’s writ of preliminary injunction relative to a Stop Work order issued by the City of New Orleans. After additional thorough review of the record evidence — especially the evidence related to the arbitrary nature of the City’s actions in this case, we find that the trial court abused its great discretion in refusing to grant Mr. St. Raymond’s writ of preliminary judgment. Accordingly, we enter judgment reversing the trial court judgment and granting Mr. St. Raymond’s writ of preliminary injunction. For the reasons explained more fully below, the City of New Orleans is hereby preliminarily enjoined from preventing Mr. St. Raymond from completing construction of three townhouses at 1400-1404 Audubon Street.

In his application for rehearing, Mr. St. Raymond takes exception to this court’s recitation of a number of facts in our previous opinion. However, only one of those facts is material to our decision to reverse the judgment denying the writ of preliminary injunction. In our original decision, we found that Mr. St. Raymond had failed to establish a prima facie case of entitlement to a preliminary injunction |¡>because he failed to show that the original Stop Work order issued by the City on April 19, 1999 was ever lifted. Our finding that Mr. St. Raymond continued construction in blatant violation of the Stop Work order was the pivotal fact in our decision.

However, as Mr. St. Raymond points out in his application for rehearing, his claim that the City officially lifted the Stop Work order and allowed him to resume construction on the townhouse project was set out in his verified petition and in his affidavit, both of which are competent evidence in the absence of denial by the defendant, the City of New Orleans. Not only did the City fail to deny that claim, it actually corroborated that claim through evidence submitted in support of its exception of subject-matter jurisdiction. For example, in its brief in support of that exception, the City stated as follows:

[T]he Department issued a Stop Work Order on or about April 19, 1999, citing a violation of the Building Code Ordinance Number 12,753 M.C.S. & 14,224 M.C.S. Subsequently, plaintiff wrote to the Director of the Department a letter requesting that the Stop Work Order be lifted based upon an interoffice memorandum .of Deborah Wilson sent to the City Planning Commission. The Director thereafter allowed the work to continue after a review [of] information submitted with the permit application.

(Emphasis added.) Moreover, Defendant’s Exhibit 5 attached to the City’s exception is the affidavit of Keith T. Johnson, acting director of the Department of Safety and Permits. Mr. Johnson attested that after the issuance of the first Stop Work order he “permitted the work to continue” until the issuance of the second Stop Work order.

laThus, Mr. St. Raymond’s decision to commence construction after the issuance of the first Stop Work order was officially sanctioned by the City. Accordingly, the pertinent inquiry for determining this appeal is whether Mr. St. Raymond proved entitlement to issuance of a preliminary injunction prohibiting the City from enforcing the second Stop Work order, issued on June 17, 1999.

As explained in our original opinion, a moving party is generally entitled to issuance of a preliminary injunction only if he proves the existence of three elements: (1) that the injury, loss, or damage he will suffer if the injunction is not issued may be irreparable; (2) that he is entitled to the relief sought; and (3) that he will be likely to prevail on the merits of the case. A to Z Paper Co., Inc. v. Carlo Ditto, Inc., 98-1417, p. 9 (La.App. 4 Cir. 9/9/98), 720 So.2d 703, 708. See also General Motors Acceptance Corp. v. Daniels, 377 So.2d 346, 348 (La.1979). In our original opinion, we determined that Mr. St. Raymond had failed to prove the first element required for entitlement to a preliminary injunction—i.e., irreparable harm. However, our original decision was based on our finding that Mr. St. Raymond failed to prove that he had suffered irreparable harm at the time the first Stop Work order was issued on April 19, 1999. As we previously held, the record indicates that the only action taken by Mr. St. Raymond at that time was the driving of pilings. Mr. St. Raymond stated in his letter to the City as follows: “I am just days away from filling and pouring the foundation.” Following the City’s decision to lift the first Stop Work order, the record reveals that Mr. St. Raymond incurred substantially more expense in reliance on the building permit, as explained in more detail below. Nevertheless, as stressed by the dissent, the fact that Mr. St. Raymond has now suffered additional monetary losses is insufficient to support a finding of irreparable harm.

|4However, the inquiry does not end there because the jurisprudence establishes one exception to the “irreparable harm” requirement for issuance of a preliminary injunction. That exception arises whenever “the action sought to be enjoined directly violates the constitution or prohibitory law.” St. Charles Gaming Co., Inc. v. Riverboat Gaming Commission, 94-2697, p. 5 (La.1/17/95), 648 So.2d 1310, 1314. Under the facts and circumstance established by the record in this case, we originally found that the City’s issuance of the first Stop Work order did not violate the constitution or prohibitory law. Id. However, our finding on reconsideration that the City allowed Mr. St. Raymond to resume his construction project after the first Stop Work order was issued requires that we perform a new analysis in order to determine whether the issuance of the second Stop Work order on June 17, 1999 violated the constitution or prohibitory law.

Relevant to this inquiry is the following language from 13 Am Jur.2d Buildings § 10, adopted by this court in Dunn v. Jefferson Parish, 256 So.2d 664 (La.App. 4 Cir. 1972), writ denied, 260 La. 1137, 258 So.2d 382 (1972):

It has been generally held that a municipal building permit or license may not arbitrarily be revoked by municipal authorities, particularly where, on the faith of it, the owner has incurred substantial expense. Such a permit has been declared to be more than a mere license revocable at the will of the li-censor. When in reliance thereon, work upon the building is actually commenced and liabilities are incurred for work and material, the owner acquires a vest property right to the protection of which he is entitled.

Id. at 667 (emphasis added). Under the above principle, this court must answer the following two questions in order to determine whether Mr. St. Raymond is entitled to issuance of the preliminary injunction under the exception to the “irreparable injury” requirement: (1) whether the City’s decision to revoke the building permit was arbitrary, and (2) whether, on the faith of the building permit, Mr. St. |fiRaymond incurred substantial expense. If the answer to those two questions is “yes,” Mr. St. Raymond has acquired a constitutionally-protected vested right in the building permit “of which [he] cannot now be deprived.” Id.

Concerning the first question, we find that the City’s actions were clearly arbitrary. Our decision to that effect is based on the documentation submitted by the City itself in support of its exception to jurisdiction. The documents attached to the exception reveal the following facts concerning the City’s actions in relation to the building permit at issue in this case.

October 6, 1988 — City Council passes Ordinance No. 12753, authorizing the conditional use of the property for the construction of townhouses
August 13, 1998 — Assistant city attorney issues interoffice memorandum addressed to the deputy director of the City Planning Commission, indicating that the conditional use ordinance had not elapsed
January 21, 1999 — New Orleans Department of Safety and Permits issues Building Permit # B98006019 approving a new construction project of a multi-family dwelling
April 19, 1999 — First Stop Work order issued
June 17, 1999 — Second Stop Work order issued

It is the totality of those actions, viewed in light of the City’s own explanations for those actions, that convinces us that the City acted arbitrarily in issuing the second Stop Work order. First, the City Attorney found that the conditional use ordinance had not lapsed, and so informed both Mr. St. Raymond and the City Planning Commission. Second, the City issued the work permit. Third, the City issued a Stop Work order on April 19, 1999. Fourth, the City lifted |fithe first Stop Work order. Fifth, the City issued a second Stop Work order on June 17, 1999. This is not a case where the City issued a building permit, then found it was invalid and revoked it; the City reviewed this building permit several times, and yet never documented any defect in the permit itself. The City’s documents reveal that the second Stop Work order was not issued because the building permit was improperly issued; it was issued because the City Council revoked the conditional use ordinance.

As noted, our decision that the City acted arbitrarily is supported by the City’s own stated explanations for its actions. Mr. Johnson’s affidavit states, in pertinent part, as follows:

That Affiant issued the STOP WORK ORDER to permit an opportunity to review the information presented to the permit analyst, and to review the subject ordinances himself to determine whether the property was zoned to permit the townhouses;
That further the Affiant issued the STOP WORK ORDER to make certain that the applicant had complied with the permit process and to make sure all necessary paperwork was in order;
That after review of all documentation in connection with the permit, Affiant was satisfied that the work could continue, as he had no documentation to conclude that the zoning had reverted back, nor had the Council taken any action subsequent to the STOP WORK ORDER;
That Affiant permitted the construction work to continue until June 17, 1999, when he issued another STOP WORK ORDER following his receipt of an official copy of Ordinance No. 19,237 M.C.S., which purported to repeal the conditional use.

Thus, the City’s own documents reveal that the City performed a thorough review of Mr. St. Raymond’s application for a building permit not once, but twice — at the time the permit was originally issued, and after the issuance of the second Stop Work order. The primary purpose of the second review was “to make certain that the applicant had complied with the permit process and to make sure all necessary paperwork was in order.” The City determined that the applicant had indeed ^complied with the permit process and that all the necessary paperwork was in order and therefore allowed the construction project to continue. No defect in the building permit was discovered during either of the reviews performed. Moreover, the only justification for the issuance of the second Stop Work order was the City Council’s repeal of the conditional use ordinance. Even the basis for the final revocation is unclear from the record.

In fact, the circumstances surrounding the City’s decision to revoke the building permit in this case appear to be remarkably similar to those found arbitrary by this court in Dunn. In that case, the court quoted a letter indicating that the regulatory authority’s decision to withdraw the building permit was based on a threat from an attorney representing the residents of the neighborhood to file a lawsuit. In the instant case, the record indicates that the City’s action in revoking the conditional use permit was encouraged by an organization called the “Audubon Street Association,” which intervened in the suit. According to the “Petition for Intervention,” the “mission” of that organization “is to preserve and protect the interests of its members who are residents of Audubon Street between willow and Claiborne in the City of New Orleans.” Although that organization has a right to intervene in this action under the provisions of La. C.C.P. art. 1091, the Dunn case indicates that a decision to revoke a building permit solely on the basis of complaints from neighbors is arbitrary.

Concerning the second question, we find that Mr. St. Raymond clearly incurred substantial expense in reliance on the building permit issued by the City. Attached to Mr. St. Raymond’s petition were two affidavits showing the expenses incurred by Mr. St. Raymond. First, Mr. St. Raymond attached the affidavit of Tom Stobo, project manager for NSL Construction, Inc., the general contractor on |8the construction project. Mr. Stobo’s affidavit includes a time-line detailing sixteen steps in the work performed on the project between March 11, 1999 and June 21, 1999, as well as ten photographs showing the progression of that work. The photographs clearly reveal that all of the outside walls of the condominium project had been framed and that most of the first floor had been bricked prior to the issuance of the second Stop Work order on June 17, 1999. Second, Mr. St. Raymond attached the affidavit of Cynthia House, president of NSL, listing eleven items of possible damages flowing from the failure to rescind the Stop Work order. We find that evidence sufficient to prove that Mr. St. Raymond incurred substantial expense in rebanee on the building permit prior to the issuance of the second Stop Work order on June 17, 1999. Under the rule enunciated in Dunn, Mr. St. Raymond has established a constitutionally-protected vested property right in the building permit, which relieved him of the burden of proving irreparable harm in order to be entitled to the issuance of a preliminary injunction.

Further, our finding that the City’s issuance of the Stop Work order violated Mr. St. Raymond’s constitutionally-protected vested property right is sufficient to fulfill Mr. St. Raymond’s burden of proving the other two elements necessary to prove entitlement to a preliminary injunction — that is, that he is entitled to the relief sought and that he will be bkely to prevail on the merits of the case. There can be little doubt that Mr. St. Raymond is entitled to the rescission of a Stop Work order that violated his constitutional rights. Moreover, the fact that his constitutional rights are involved is sufficient to show that he is likely to prevail on the merits of his petition for injunction. Accordingly, we find that Mr. St. Raymond has carried his burden of proving a prima facie case of entitlement to ^issuance of a preliminary injunction. We pretermit all other issues raised by Mr. St. Raymond on rehearing.

The- dissent seeks to distinguish this case from Dunn on the basis of the fact that the building permit at issue in Dunn was “validly issued by the Parish and was issued under no error of fact by them and was not the result of any misrepresentation on the part of the Plaintiff, Mr. Dunn.” 256 So.2d at 666. In this case, the City claims that the building permit was issued under an error of fact — namely, the following conclusion stated in the Assistant City Attorney’s interoffice memorandum:

I believe that the parties involved in the Audubon Street Townhome Project took numerous concrete actions between December 6,1990 and November 7,1991 which both individually and collectively constitute legitimate “development and construction of the conditional use authorized herein.”

That finding was significant because the conditional use ordinance issued by the City in 1989, and renewed in 1990, became null, void and of no legal force and effect if the development or construction was not commenced by November 7, 1991. Thus, the dissent would find that Mr. St. Raymond’s building permit was issued under error of fact.

The dissent’s assertion that this court made a factual finding in Dunn that “there was no error in fact or law” cannot be denied. However, as we read that case, that factual finding was not pivotal to the result. The court’s finding is explained in the following statement:

The record shows that the Dunns expended considerable efforts and incurred relatively substantial expense in setting up the trailer, all in good faith reliance on the permit. It is the opinion of this court that the plaintiff has acquired a vested right to the permit of which she cannot now be deprived.

| ^Immediately thereafter, the court set out the principle of law from 13 Am. Jura. 2d, Buildings § 10, that we have quoted above. The court noted its finding that the building permit was not issued as a result of error or mistake of fact or law only to distinguish the case from Nassau Realty Co. v. City of New Orleans, 221 So.2d 327 (La.App. 4 th Cir.1969). We respectfully disagree with the dissent’s position that that fact was pivotal to the court’s decision.

Moreover, in this case, the record in this case contains no documents indicating that the City ever found that the building permit was issued as a result of- error or mistake. As noted above, the City specifically found no such error after the first review. The City’s own documents indicate that the only reason the second Stop Work order was issued was the City Council’s revocation of the conditional use permit. The record contains no official documents in which the City found that the building permit was improperly issued pri- or to the issuance of the Stop Work order. The fact that the City has now chosen to make that assertion is insufficient to overcome Mr. St. Raymond’s right to exercise his constitutionally-protected property vested property right in the permit. Accordingly, the trial court judgment denying Mr. St. Raymond’s writ of preliminary injunction is hereby reversed. Preliminary injunction prohibiting the City from enforcing the Stop Work order issued June 17, 1999, is hereby issued. The case is remanded for further proceedings.

REHEARING GRANTED; PREVIOUS OPINION RECALLED; TRIAL COURT JUDGMENT REVERSED; PRELIMINARY INJUNCTION ISSUED.

WALTZER, J., DISSENTS WITH REASONS.

|! WALTZER, J.,

dissenting with reasons.

I respectfully dissent. The record on appeal is totally devoid of any rational basis to support the majority’s implicit conclusion that the learned trial judge abused his great discretion in refusing to grant appellant’s request for -injunctive relief.

This court is well aware of the appropriate standard of review of a trial court judgment granting or refusing to grant a temporary or preliminary injunction. As we held in A to Z Paper Co., Inc. v. Carlo Ditta, Inc., 98-1417, p. 9 (La.App. 4 Cir. 9/9/98), 720 So.2d 703, 708, a trial judge has great discretion to grant or to deny the relief requested. Appellant had the burden below to convince the trial judge that the injury, loss or damage he will suffer if the injunction is not issued may be irreparable; that he is entitled to the relief sought, and that he will be likely to prevail on the merits. Id. Appellant’s burden on appeal is to show that the trial judge abused his great discretion in deciding not to grant interlocutory relief. From my review of the record, I am convinced that appellant failed on both counts. In the trial court, he failed to show irreparable harm, and on appeal he failed to show manifest abuse of discretion.

Even if I were to accept as true the chain of the City’s incompetent and inept actions as alleged by appéllant, I find nothing in the record to show that appellant cannot be compensated by money damages for his all of his alleged losses in his ^commercial enterprise. Of at least equal significance, I find absolutely no justification on this record for penalizing the appellant’s innocent neighbors for the City’s alleged negligence by imposing on their neighborhood a non-conforming structure.

Injunction has been held to be a harsh, drastic and extraordinary remedy, and should issue only where the plaintiff is threatened with irreparable loss without an adequate remedy at law. Lafreniere Park Foundation v. Friends of Lafreniere Park, Inc., 97-152 (La.App. 5 Cir. 7/29/97), 698 So.2d 449, writ denied, 97-2196 (La.11/21/97), 703 So.2d 1312. Appellant herein makes no allegation of damage that cannot be measured monetarily, of non-monetary enjoyment envisioned by him or of the project’s satisfying some non-financial appetite. Absent a showing of “irrepa-rabie harm,” the trial judge quite properly denied injunctive relief.

It must be recalled that at the time of appellant’s purchase of the subject property, the ordinance permitting a non-conforming use on which appellant relies had expired on its face as of 7 November 1991, nearly seven years earlier. In light of this patent, apparent issue, appellant, a sophisticated investor, sought an opinion from the City Planning Commission as to the validity of the ordinance. When the Commission referred the issue to the City Attorney, no formal opinion was issued. Instead of requiring a formal opinion signed by the City Attorney, as required by law, appellant relied on an inter-office memo from an assistant in the City Attorney’s office stating that in her opinion the ordinance had not expired On that basis, appellant sought and obtained a building permit. Now, he would have this Court accord to this assistant’s memorandum the dignity of a formal opinion of the City Attorney. This I would not do. Counsel also would make much of the dates on which the City Council repealed the original ordinance and the Mayor signed the repeal. I do not find the repeal of the original ordinance to be relevant to the issues herein. That ordinance had expired in 1991 and no longer had any force or 13effect at the time of the repeal. A legislative act repealing an act that is long dead cannot revive the previous act retroactively; nor can a legislative body repeal that which no longer exists.

The negligence, vel non, of the City Attorney’s office and of the Department of Safety and Permits is not before us today. Assuming appellant’s allegations of error on the part of the assistant City Attorney and the Department to be true, he can be compensated by the City for any resulting damages after a full trial on the merits, when all relevant facts can be developed fully.

The majority builds its decision to overrule the trial court’s judgment on a foun- . dation even more tenuous than the ephemeral “plans” for the townhouse project as they existed when appellant purchased the property. The majority concludes that the City’s action violated appellant’s constitutionally protected vested right in the building permit, thereby making a finding of irreparable harm an unnecessary prerequisite to issuance of the sought-after injunction. The majority relies on the following language from this Court’s opinion in Dunn v. Jefferson Parish, 256 So.2d 664, 667 (La.App. 4 Cir.), writ den. 260 La. 1137, 258 So.2d 382 (1972):

It has been generally held that a municipal building permit or license may not arbitrarily be revoked by municipal authorities, particularly where, on the faith of it, the owner has incurred substantial expense. Such a permit has been declared to be more than a mere license revocable at the will of the licensor. When in reliance thereon, work upon the building is actually commenced and liabilities are incurred for work and material, the owner acquires a vested property right to the protection of which he is entitled. [Emphasis added.]

The majority is persuaded by the fact that appellant “has incurred substantial expense” (albeit with full knowledge of the questionable status of the conditional use ordinance), while ignoring the requirement that the City's action revoking the 14permit must be found to have been “arbitrary.” Dunn applies by its own terms only to arbitrary revocation of a valid building permit or license.

In that case, the trial court in its reasons for judgment specifically found that the permit involved was issued validly by the parish, and was issued under no error of fact and was not the result of any misrepresentation by the party. Most significantly, we held in Dunn:

Defendant strenuously argues that under the case of Nassau Realty Co. v. City of New Orleans, 221 So.2d 327 (La.App. 4 Cir.1969), when a building permit is unlawfully issued as a result of error or a mistake of fact or law, the governing authority which granted the permit has a right to cancel it. In the light of our finding that there was no error in fact or law, nor any misrepresentation by the applicant which induced the issuance of the permit, the principle of law enunciated in the Nassau case is not apposite to the factual situation in this matter. [Emphasis added] 256 So.2d at 667.

I must assume this paragraph was somehow overlooked by the majority when they read Dunn. Dunn does not purport to overrule or modify Nassau Realty. The distinguishing fact is the validity of Mr. Dunn’s building permit. Where, as here, the permit was invalid ab initio, the Dunn opinion itself requires the conclusion that the “governing authority which granted the permit has a right to cancel it.” See also, Zelenko v. Jefferson Parish, 414 So.2d 828 (La.App. 4 Cir.1982). I am convinced that under the facts of this case, the permit revocation cannot be held to have been arbitrary. Therefore, the constitutional exception to the requirement of irreparable harm is inapplicable.

Therefore, appellant has failed to show a violation of a constitutionally protected due process property right under Dunn. The Constitution quite simply does not protect a scofflaw who proceeds to incur substantial expenses in the face of what he knows to be an invalid building permit issued pursuant to an ordinance that has expired on its face.

| ¡jAbsent such a deprivation of a due process right, we are left with a simple claim by appellant against the City for money damages arising out of the City’s alleged negligence and ineptitude in handling the permit issue. Nothing in the record gives the appellant the right to build a structure that violates the City’s Comprehensive Zoning Ordinance. If he proves at a full trial that he relied to his detriment on the City’s various allegedly negligent actions, he may then be entitled to his monetary damages, but no more. I agree with the counsel for the neighboring property owners and residents, who are totally innocent in the premises, and who have done nothing to justify the imposition of this structure that violates their neighborhood’s RD-2 residential two-family zoning designation. 
      
      . The first time we considered this appeal, we; failed to review the City’s exception to subject-matter jurisdiction because the trial court’s disposition of that exception was not before us. However, the exception is a part of the record and therefore may be used to establish or corroborate facts asserted by Mr. St. Raymond.
     
      
      . We agree with the City and the dissent’s assertion that the interoffice memorandum issued by the Assistant City Attorney, in and of itself is insufficient to prove that the City’s actions were arbitrary in this case. However, since it was an action taken by the City, it may be considered in conjunction with the City’s other actions in order to determine whether the City acted arbitrarily.
     