748 So

748 So.2d 417, 1999-0201 (La. 10/19/99)
Rehearing Denied

Supreme Court of Louisiana.
SPORTSMAN STORE OF LAKE CHARLES, INC.
v.
SONITROL SECURITY SYSTEMS OF CALCASIEU, INC., Cassidy Insurance Agency and
Stewart Keith Cayton.
No. 99-C-0201.
Oct. 19, 1999.
Rehearing Denied Nov. 19, 1999.

Store that suffered losses during undetected burglary brought negligence
action against security system company and its owner. The 14th Judicial
District Court, Parish of Calcasieu, No. 91,387, Gregory D. Lyons, J., found
no negligence, and store appealed. The Court of Appeal, Saunders, J., 725
So.2d 74, reversed. Defendants petitioned for writ of certiorari. The
Supreme Court, Victory, J., held that: (1) trial court was not manifestly
erroneous in finding that security system company and its owner were not
negligent in their design and installation of store's security system, and
(2) trial court was not manifestly erroneous in finding that security system
company and its owner properly installed store's siren.
Court of Appeal's judgment reversed; trial court's judgment reinstated.
Johnson, J., dissented.
Knoll, J., dissented for reasons assigned by Court of Appeal.
Johnson and Knoll, JJ., would grant the rehearing.

West Headnotes

[1] KeyCite Notes

372 Telecommunications
372IV Special Services or Activities
372k463 k. Alarm Systems. Most Cited Cases

Trial court was not manifestly erroneous in finding that security system
company and its owner were not negligent in their design and installation of
store's security system; although store's expert purported to analyze
installation under current industry standards, store failed to specifically
present such standards, security system company's experts testified that
system was properly designed and installed according to company's and
national alarm association's standards, and company's owner told store owner
that digital system would not relay signal to central alarm station if phone
lines were cut, that store's phone lines were exposed, that company was not
authorized to touch phone lines, and that he recommended direct wire system.

[2] KeyCite Notes

30 Appeal and Error
30XVI Review
30XVI(I) Questions of Fact, Verdicts, and Findings
30XVI(I)2 Verdicts
30k999 Conclusiveness in General
30k999(1) k. In General. Most Cited Cases

30 Appeal and Error
30XVI Review
30XVI(I) Questions of Fact, Verdicts, and Findings
30XVI(I)3 Findings of Court
30k1008 Conclusiveness in General
30k1008.1 In General
30k1008.1(5) k. Clearly Erroneous Findings. Most Cited Cases

30 Appeal and Error
30XVI Review
30XVI(I) Questions of Fact, Verdicts, and Findings
30XVI(I)3 Findings of Court
30k1008 Conclusiveness in General
30k1008.1 In General
30k1008.1(7) k. Manifest or Obvious Error. Most Cited Cases

A Court of Appeal may not set aside a finding of fact by a trial court or a
jury in the absence of manifest error or unless it is clearly wrong.

[3] KeyCite Notes

30 Appeal and Error
30XVI Review
30XVI(I) Questions of Fact, Verdicts, and Findings
30XVI(I)1 In General
30k996 k. Inferences from Facts Proved. Most Cited Cases

30 Appeal and Error
30XVI Review
30XVI(I) Questions of Fact, Verdicts, and Findings
30XVI(I)3 Findings of Court
30k1011 On Conflicting Evidence
30k1011.1 In General
30k1011.1(6) k. Credibility and Number of Witnesses. Most Cited
Cases

When there is conflict in the testimony, reasonable evaluations of
credibility and reasonable inferences of fact should not be disturbed upon
review, even though the appellate court may feel that its own evaluations
and inferences are as reasonable.

[4] KeyCite Notes

30 Appeal and Error
30XVI Review
30XVI(I) Questions of Fact, Verdicts, and Findings
30XVI(I)1 In General
30k994 Credibility of Witnesses
30k994(3) k. Province of Trial Court. Most Cited Cases

The rule that questions of credibility are for the trier of fact applies to
the evaluation of expert testimony, unless the stated reasons of the expert
are patently unsound.

[5] KeyCite Notes

30 Appeal and Error
30XVI Review
30XVI(I) Questions of Fact, Verdicts, and Findings
30XVI(I)3 Findings of Court
30k1008 Conclusiveness in General
30k1008.1 In General
30k1008.1(4) k. Credibility of Witnesses; Trial Court's Superior
Opportunity. Most Cited Cases

30 Appeal and Error
30XVI Review
30XVI(I) Questions of Fact, Verdicts, and Findings
30XVI(I)3 Findings of Court
30k1011 On Conflicting Evidence
30k1011.1 In General
30k1011.1(6) k. Credibility and Number of Witnesses. Most Cited
Cases

When documents or objective evidence so contradict a witness's story, or the
story itself is so internally inconsistent or implausible on its face, that
a reasonable fact-finder would not credit the witness's story, the Court of
Appeal may find manifest error or clear error, even in a finding purportedly
based upon a credibility determination; however, where such factors are not
present and the fact-finder's determination is based on its decision to
credit the testimony of one of two or more witnesses, that finding can
virtually never be manifestly erroneous or clearly wrong.

[6] KeyCite Notes

372 Telecommunications
372III Television and Radio
372k460 k. Satellite Broadcasting and Communication. Most Cited Cases
(Formerly 372k449.20)

Trial court was not manifestly erroneous in finding that security system
company and its owner properly installed store's siren; although store's
expert purported to analyze installation under current industry standards,
store failed to specifically present such standards, and security system
company's experts testified that system was properly designed and installed
according to company's and national alarm association's standards.
John Gregory Bergstedt, Lake Charles, for Applicant.
Michele S. Caballero, Milo Addison Nickel, Jr., Lake Charles, for
Respondent.
Douglas Lanaux Grundmeyer, Jena Smith-Malfatti, Gregory Joseph Walsh, Wilbur
Anthony Toups, III, New Orleans, for Advantage Capital Partners IV,
Advantage Capital Partners III, Advantage Capital Partners II, Advantage
Capital Partners V, (Amicus Curiae).
Robert Alexander Jarred, Lafayette, for Burglar and Fire Alarm Association
(Amicus Curiae).
John E. Gagliano, R. Scott Caulkins, Arlington, VA, Loretta Gallaher Mince,
James Richard Swanson, New Orleans, for Sonitrol National Dealer
Association, Sonitrol Corporation (Amicus Curiae).

VICTORY, J. [FN*]

FN* Kimball, J., not on panel. Rule IV, Part 2, § 3.

In this case, we are presented with the issue of whether the Third Circuit
Court of Appeal properly applied the manifest error standard of review.
After reviewing the record and the applicable law, we reverse the court of
appeal and reinstate the judgment of the trial court.

FACTS AND PROCEDURAL HISTORY
In March of 1989, Gary Klumpp ("Klumpp"), owner of the Sportsman Store of
Lake Charles (the "Sportsman Store"), a retail store and pawn shop which was
expanding to sell jewelry, as well as guns, contacted Stewart Keith Cayton
("Cayton"), owner of Sonitrol Security Systems of Calcasieu, Inc.
("Sonitrol"), concerning the design and installation of a security system
for a new location of his business at a busy intersection.
After inspecting the premises, Cayton discussed three options with Klumpp: a
digital dialing system, a direct wire system, and a cellular system. The
cellular system was immediately rejected by Klumpp because it was too
expensive. Cayton explained to Klumpp that in the direct wire system, the
security system's central monitoring station would know immediately if the
secured premises' phone lines were cut and the operator on duty would then
contact the police. But in the digital dialing system, Cayton explained that
the central monitoring station monitors only the information sent by the
system over the existing telephone line, and thus the operator at the
station will not know if the telephone line has been cut. However,
approximately one minute after the line is cut, the siren will sound. Cayton
testified that he recommended that Klumpp purchase the slightly more
expensive direct wire system [FN1] because of the danger that burglars could
cut through the exposed telephone wires on the side of the building thereby
cutting off communication with Sonitrol's central alarm station. Cayton
testified that he told Klumpp that if he chose the digital system, the
telephone wires were not protected and that Sonitrol was prohibited by law
from touching the phone lines.

FN1. The additional cost for the direct wire system was a $120.00
installation fee plus other labor charges and an installation fee and
monthly phone line charges to the phone company.

Klumpp testified at trial that in spite of this explanation, he understood
that the only difference between the two systems was that the direct wire
system had two telephone lines, whereas the digital dialing system had one
line, but that as two lines were just as easy to cut as one, he chose the
digital dialing system. He also testified that he purchased the system
because Cayton told him that he had a one million dollar insurance policy
that would cover Klumpp's losses if there was an undetected break-in.
Cayton proceeded to design and install the digital dialing system at the
Sportsman Store. Because of the high volume of vehicular traffic at the
intersection where the store was located and because Klumpp wanted the siren
to be as loud as possible, the siren was installed on the outside of the
store above the front door. The siren was encased in a 16-gauge steel
cabinet and screwed into the wall with four metal screws. There were two
tamper switches on the siren and all the wires to the siren were either
inside the store or inside the store wall. Klumpp signed the contract for
the design, and installation of the system and monitoring services, which
contained a limitation of damages clause, as well as a limited
manufacturer's warranty.
Sometime between the evening of June 21 and the morning of June 22, 1990,
the Sportsman Store was burglarized. It is undisputed that the burglars
first cut the telephone wire on the side of the building and the telephone
wire at the telephone pole and then pried the siren off the wall, pulled the
siren wires out of the wall and cut them. They then proceeded to steal
numerous items from the store.
The Sportsman Store filed suit against Sonitrol and Cayton seeking damages
for negligent design and installation of the system, negligent
representations as to the adequacy of the security system, and negligent
and/or intentional misrepresentation concerning the one million dollar
insurance coverage. In addition to the claims against Sonitrol and Cayton,
the Sportsman Store made a claim against Cassidy Insurance and Real Estate
Agency, Inc., an insurance company that Klumpp had purportedly purchased
property insurance from, for failure to procure a property insurance policy
containing theft coverage. This claim was settled prior to trial.
At trial, Klumpp and Cayton testified to the facts as stated above and each
party presented expert testimony regarding the design and installation of
the system. Plaintiff's expert was Dr. David Salmon, who was accepted as an
expert in the field of security and evaluation of burglar alarm systems. He
testified that the Sonitrol system as installed deviated from industry
standards in the following respects: (1) the exposed phone lines were not
concealed or covered in conduit; (2) the wires of the siren were not encased
in conduit and the siren was attached to the building with metal screws,
rather than welded; and (3) the owner was not told to either have the phone
lines covered or to call the phone company to do something with the phone
lines. He gave his opinion that these deviations in combination rose to the
level of gross negligence.
Defendants presented two experts, Steve Midkiff, who had worked for Sonitrol
of Orlando for 14 years, and Cayton. Both were qualified as experts in the
design and installation of Sonitrol security systems. Midkiff testified that
the system was properly designed and installed in accordance with Sonitrol
standards, that the siren was properly mounted and placed, that the owner
has the responsibility to either hide or cover phone lines, and that when he
sees exposed phone lines, he recommends the use of another system, such as
cellular. Cayton testified that the design and installation of the system
met both Sonitrol and the National Burglar Alarm Association standards. He
further testified that tests performed on the system after the burglary
indicated that the system initiated the alarm but the phone lines could not
deliver the signal to the central station because they had been cut, and
that the siren was sounding when the siren wires were cut.
The trial court found that the defendants were not liable for any damages to
plaintiff based on the following findings of fact and conclusions of law:
1. The Sonitrol Security System in place at the Sportsman Store at the time
of the burglary was properly designed and installed and there was no failure
in the system in its design or installation.
2. The Sportsman Store of Lake Charles, through its agent/officer, Gary
Klumpp, chose the configuration and application of the security system as
installed in the premises and was solely responsible for the features on the
security system as installed in the said premises.
3. The public phones lines which were cut and thereby prevented the Sonitrol
Security System from signaling the alarm to central station, were installed
and configured by the phone company and it is a standard in the security
industry that security system installers are not even supposed to touch
these lines during installations.
4. The siren bell installed in this premises was installed correctly and in
accordance with applicable standards and reasonable care was taken to
protect the bell from tamperers.
5. The Sonitrol Security System installed in the Sportsman Store properly
functioned at the time of the break-in in accordance with the design for the
system chosen and purchased by the Sportsman Store.
6. Neither SONITROL SECURITY SYSTEMS OF CALCASIEU, INC. nor STEWART KEITH
CAYTON provided any insurance coverage which would be applicable to the
losses allegedly sustained by the plaintiff.
7. The Sonitrol Client Contract, admittedly signed by Gary Klumpp, clearly
and unambiguously confirmed Mr. Klumpp's understanding of the system's
dependence upon public telephone lines and further confirmed that Sonitrol
was not an insurer nor provided any insurance coverage pursuant to their
monitoring services.
8. It is evident to this Court that the Sportsman Store of Lake Charles was
made aware of the drawbacks and benefits of the security system they chose.
Therefore, SONITROL SECURITY SYSTEMS, INC. and its agent are not responsible
for the damages resulting from the burglary at the Highway 14 location.
The Third Circuit Court of Appeal reversed and, based on the testimony of
plaintiff's expert, found that Sonitrol and Cayton had negligently designed
and installed the system because it did not comply with industry standards
that required Sonitrol to either warn Klumpp that the phone lines should be
encased in conduit or to call the phone company and have the phone lines
encased or hidden. Sportsman Store of Lake Charles, Inc. v. Sonitrol
Security Systems of Calcasieu, Inc., 98-851 (La.App. 3 Cir. 12/23/98), 725
So.2d 74. The court of appeal rejected the defense experts' testimony
because they were only qualified as Sonitrol experts and not industry
experts, thus making the plaintiff's expert testimony uncontradicted. Id.
Further, the court of appeal found that the defendants' liability was not
limited by the terms of the contract because their conduct was grossly
negligent and because the limitation of damages clause was not brought to
Klumpp's attention. Id. The court of appeal affirmed the trial court's
finding that the defendants did not engage in any fraudulent conduct
regarding the one million dollar insurance policy. [FN2] Id. Finally, the
court of appeal awarded plaintiff $458,000.00, plus interest, in damages. We
granted the defendants' writ. Sportsman Store of Lake Charles, Inc. v.
Sonitrol Security Systems of Calcasieu, Inc., 99-C-0201 (La.3/26/99), 739
So.2d 799.

FN2. We agree with the lower courts on this issue. Further, we note that
plaintiff did not urge at trial or on appeal that it was entitled to the
alleged $1,000,000.00 insurance policy. Further Cayton testified, and he
told Klumpp, that the policy would be on top of the $5,000.00 limited
manufacturer's warranty and would be applicable if the $5,000.00 limited
manufacturer's warranty was applicable. However, because, in the case of a
non-dedicated phone line system, the manufacturer warranted only that the
siren would sound if the phone line was cut, and all evidence adduced at
trial indicates that it did, the $5,000.00 limited manufacturer's warranty
apparently would not be applicable.

DISCUSSION
[1] [2] [3] [4] [5] It is well settled that a court of appeal may not set
aside a finding of fact by a trial court or a jury in the absence of
"manifest error" or unless it is "clearly wrong," and where there is
conflict in the testimony, reasonable evaluations of credibility and
reasonable inferences of fact should not be disturbed upon review, even
though the appellate court may feel that its own evaluations and inferences
are as reasonable. Lirette v. State Farm Ins. Co., 563 So.2d 850, 852
(La.1990); Rosell v. ESCO, 549 So.2d 840, 844 (La.1989); Arceneaux v.
Domingue, 365 So.2d 1330, 1333 (La.1978); Canter v. Koehring Co., 283 So.2d
716, 724 (La.1973). The rule that questions of credibility are for the trier
of fact applies to the evaluation of expert testimony, unless the stated
reasons of the expert are patently unsound. Lirette v. State Farm Ins. Co.,
supra at 853; Sistler v. Liberty Mutual Ins. Co., 558 So.2d 1106 (La.1990).
Where documents or objective evidence so contradict the witness's story, or
the story itself is so internally inconsistent or implausible on its face,
that a reasonable fact-finder would not credit the witness's story, the
court of appeal may well find manifest error or clear wrongness even in a
finding purportedly based upon a credibility determination. Rosell v. ESCO,
supra at 844-45. But where such factors are not present, and a fact-finder's
determination is based on its decision to credit the testimony of one of two
or more witnesses, that finding can virtually never be manifestly erroneous
or clearly wrong. Id. (Cites omitted.)
The trial court found that the Sonitrol system was properly designed and
installed, that it functioned properly at the time of the break-in, and that
Klumpp was made aware of the danger presented by the exposure of the phone
lines. Therefore, Sonitrol and Cayton were not found liable for any damages
as a result of the burglary. This finding was consistent with the testimony
of Midkiff, who testified that the system was properly designed and
installed according to Sonitrol standards, and Cayton, who testified that
the system also met the standards of the National Fire and Burglar Alarm
Association, and, that he recommended that Klumpp purchase the direct wire
system because of the danger that burglars could cut through the exposed
phone wires.
However, the court of appeal reversed, finding that Sonitrol and Cayton had
negligently designed and installed the system because it did not comply with
industry standards that required Sonitrol to either warn Klumpp that the
phone lines should be encased or call the phone company and have the phone
lines encased or hidden. This finding was reached by rejecting the defense
experts' testimony as being based only on Sonitrol, as opposed to industry,
standards, and by accepting the plaintiff's expert's interpretation of
industry standards because it was "uncontradicted." This was erroneous.
Initially, we point out that although the plaintiff's expert purported to
analyze the installation of this security system under current industry
standards, nowhere did the plaintiff present these standards in any specific
way. Instead, Dr. Salmon said that industry standards were dictated by
common industry practice and procedures and usually are promulgated in books
and publications and in industry guides and through normal application at a
local level. Although the plaintiff offered no books, publications, or
industry guides containing the industry standards into evidence, Dr. Salmon
described these standards as follows:
... you need to try to put as much of the operating system of the alarm,
especially if it's not protected, inside that protective zone again; in
other words, buy us time. Everything we look at in security regarding
burglar alarms or security procedures is measured in time, how long can we
delay them getting in, getting out, whatever we're trying to prevent. In
this particular case both in this publication I reference here, Protection
of Assets, my practice in years in this business, the phone line should have
been protected, and you can do that in several ways, but the phone line
needed to be protected as best we could from the installation to the central
monitoring point.
He then gave his opinion that the system breached these industry standards
because, in addition to the phone wires not being encased or hidden and the
siren not being more securely fastened to the wall, Cayton had a duty to
tell Klumpp to either have the phone lines covered or to call the phone
company and tell them to either hide or cover the phone lines.
However, Cayton testified that he told Klumpp that the digital system would
not relay a signal to the central alarm station if the phone lines were cut,
that his phone lines were exposed, and that Sonitrol was not authorized to
touch the phone lines. Because of this danger, he recommended that Klumpp
purchase the slightly more expensive direct wire system, but Klumpp refused.
We agree with the trial court that this satisfied any duty Cayton may have
had in this regard and that Cayton was not required to tell Klumpp
specifically "if you want the phone lines covered, call the phone company."
Common sense and logic would dictate that when Klumpp was advised that his
lines were exposed, that the system was vulnerable and that Cayton could not
touch the lines, it would be Klumpp's responsibility to have the lines
protected, either by contacting the telephone company or by some other
method.
[6] Based upon the testimony of both defense experts, the trial court found
that the siren was installed correctly and in accordance with applicable
standards and reasonable care was taken to protect the bell from tamperers.
Again, the court of appeal overturned this finding, holding that the trial
court was bound to accept the testimony of the plaintiff's expert over the
testimony of the defense experts. However, the trial court was free to
reject the plaintiff's expert testimony that Sonitrol should have welded the
siren to the wall and covered the siren wires in metal conduit. We find that
based on the testimony of the defense experts in the record, the trial court
did not commit manifest error in finding that the siren was properly
installed.

CONCLUSION
In sum, after reviewing the record in its entirety and applying the
appropriate standard of appellate review, we hold that the trial court did
not commit manifest error in finding that Sonitrol and Cayton were not
negligent in their design and installation of the system at the Sportsman
Store. Our holding obviates the need to address the court of appeal's
invalidation of the limitation of damages clause in the Sonitrol contract
based on its finding that Sonitrol and Cayton were grossly negligent [FN3]
and its application of waiver of warranty requirements to the limitation of
damages clause. [FN4]

FN3. Under Civil Code art. 2004, "[a]ny clause is null that, in advance,
excludes or limits the liability of one party for intentional or gross fault
that causes damage to the other party."

FN4. The court of appeal invalidated the limitation of damages provision in
the Sonitrol contract because it was not brought to Klumpp's attention by
relying on cases that are applicable only to waivers of warranty. See, e.g.,
Matthis v. Couvillion, 613 So.2d 1024 (La.App. 3 Cir.1993); Thibodeaux v.
Meaux's Auto Sales, Inc., 364 So.2d 1370 (La.App. 3 Cir.1978); Dixie Roofing
of Pineville, Inc. v. Allen Parish School Bd., 95-1526 (La.App. 3 Cir.
5/8/96), 690 So.2d 49, writs denied, 96-2084 (La.11/8/96), 683 So.2d 276 and
96-2100 (La.11/8/96), 683 So.2d 277 (also holding that a warranty which
precludes recovery of consequential damages must be made a part of the sales
contract in order to be effective). Compare La. C.C. art. 2005 with La. C.C.
art. 2548.

DECREE
For the reasons stated herein, the judgment of the court of appeal is
reversed and the judgment of the trial court is reinstated.
REVERSED.

JOHNSON, J., dissents.

KNOLL, J., dissents for the reasons by the court of appeal.
La.,1999.
Sportsman Store of Lake Charles, Inc. v. Sonitrol Security Systems of
Calcasieu, Inc.
748 So.2d 417, 1999-0201 (La. 10/19/99), Rehearing Denied