Court favors Eagle Dry Dock against Terrebonne Port

UPDATED: Injured football player ‘responding’, but still in critical condition
September 30, 2015
Alfreda Richoux
October 6, 2015
UPDATED: Injured football player ‘responding’, but still in critical condition
September 30, 2015
Alfreda Richoux
October 6, 2015

The stinging and lengthy court decision that brought an end to the Port of Terrebonne’s lawsuit against a major tenant – and the court action against the port that the original case spawned – leave a major question unanswered by either party.

Why would a public entity like the Terrebonne Port Commission seek to derail the tenancy of an operation like Eagle Dry Dock, a curious alleged outcome the litigation hints at but which so far remains unsubstantiated.

Representatives on both sides of the long-standing dispute say the suit brought by Eagle after its eviction from the port was waylaid by the Louisiana 1st Circuit Court of Appeal is the subject of intense negotiation, and will likely result in some type of settlement.

But the cases remain a thorn in the side of the port and its director, David Rabalais, whose ousting was demanded of – and rejected by – commission members.

“The board has chosen not to make any statement on the case at this time,” Rabalais said, when asked for comment on the ignored plea for his removal and the current litigation.

Ronnie Chiasson, owner of the Houma dry dock firm, has had plenty to say, however.

“I want the public to know about this,” said Chiasson, referring in particular to the $250,000 price tag payable by the port for the litigation that has taken place thus far. “There is no reason for it. And the public is paying for it. We are all paying for it.”

Court documents tell a portion of the history, but give few clues to why things got to the point they did.

It all started when the Port of Terrebonne leased prime waterfront property to Eagle in 2006, and amended the lease in 2009.

Under the terms of the Lease, Eagle was required to stabilize the shoreline of the property, “through use of bulkhead, gobi-mats or any others means “approved by the Port” within three years of the company’s development of the property.

There was a default clause in the lease, which mandated that any performance required of Eagle persisting over 30 days – once official notice was given – would result in a cancellation of the lease if uncorrected.

Such a breach would be considered as cured, the lease agreement states, if the problem is corrected within 30 days and continues with “reasonable diligence” continues correcting the discrepancy.

The court papers say that in May of 2011, Rabalais was conducting a survey of a property adjacent to Eagle’s dock, and observed what he stated was erosion of the Eagle property, and he wrote to Ronald Chiasson, Eagle’s owner.

A month prior to that, according to court records, the port had expressed an intent to stabilize the bank on Eagle’s property and that it would build up an existing limestone slope from water to land to a better grade.

“Once this grade is achieved, articulating concrete mats should be placed on the surface of the limestone,” the port’s engineering report states.

As a result of those details an August, 2011 supplement to the lease was executed. It contains a provision that says Eagle would begin the process of obtaining state and federal permits required for the concrete mats, and that they must be obtained within six months of the effective lease supplement date.

Eagle, the supplement states, was required to complete 25 percent of the mats within six months of work starting, with further installations required at six month increments afterward.

The purpose of the project was, court papers say, “to reclaim lost property due to erosion and mechanical dredging.”

The port communicated that a bulkhead would require installation as well.

Plans moved forward and Chiasson secured permits from Terrebonne Parish and the Louisiana Department of Natural Resources by February of 2012, court papers say. But the Corps of Engineers did not issue theirs until May, three months past the agreed-upon deadline.

“If we are going to meet the schedule we need to start the project as soon as possible,” Chiasson said, in a May 15 e-mail to Rabalais. “This would be a good time to begin preparing the bank for the mats. Are you okay with us starting?”

After Chiasson forwarded the plans to Rabalais, according to the court papers, the port director asked for a few days to get the drawings reviewed and a report from the port engineer.

During engineering discussions Rabalais asked the firm doing the checking, GSE, to make sure that “the toe of the mats go far enough out from the bank.”

GSE objected to the way the slope of the concrete was angled in the plans, or at least the appearance of how it was angled.

Rabalais, based on his communications with GSE, which determined that a scale problem in the drawing was what gave the impression of an error, told Chiasson to go ahead, stating “as long as the mats are placed on a 3:1 slope or greater and the mats extend out until the 3:1 slope terminates naturally to a flatter slope, we are okay with the design.”

Eagle considered the e-mail to be an approval and had a contractor forming the concrete mats on site.

Construction of the mats began in July and Rabalais sent an e-mail to Chiasson stating that he needed to verify that the mats were designed and built correctly.

Rabalais, according to the court documents, later asserted that Eagle’s contractor was not cooperating with the oversight and that the port, therefore, was shutting the project down.

Eagle’s attorney then questioned the port on what he perceive as changes to the plans beyond what was initially agreed.

The attorney told Rabalais that the port could not “just arbitrarily and unilaterally keep insisting on additional engineering work on a project that has already been approved by everyone.”

The following day, Rabalais sent an email to Chiasson asking if Eagle would be willing to give up the lease and the properties if someone else had an interest in them; Chiasson said he would consider doing so and, despite a suggestion of Rabalais, the court documents state, continued mat construction.

On July 26, 2012, attorneys for the port sent a letter to Rabalais stating they had violated the lease because it did not allow the port engineers to inspect the work.

Another notice of default was sent in August, that one stating the necessary permits were not secured in a timely fashion.

Chiasson, according to the court papers, began to feel that the port was looking for excuses to terminate the lease.

The permits obtained from the corps, communication in the court documents states, were inadequate for approval of the plans as written from the port’s point of view.

More allegations of default, therefore, were sent to Chiasson by the port’s attorneys.

The communications, a 1st Circuit Court of Appeal decision, revealed conflicting understandings between the port and Chiasson.

Eagle kept doing work on the mats and problems with the Port escalated.

On Aug. 17, 2012, the port filed a petition in court to dissolve the lease, alleging two defaults.

The port sought to have Eagle barred from further work on the mats.

Less than a month later, on Sept. 13, the port told Eagle it was immediately canceling the lease.

Eagle commenced a court action against the port, and the battle was on.

In May, 2013, 32nd Judicial District Judge Randy Bethancourt dismissed the port’s attempt to evict Eagle.

The port appealed, throwing the matter into the lap of the 1st Circuit, which upheld Bethancourt’s decision.

“The trial court clearly credited Eagle’s argument that it had not breached its obligations under either the lease or the supplement,” the appeals court found.

Eagle did not have to move and still occupies its space at the Port of Terrebonne.

“I am not going anywhere,” Chiasson said after the July appeals court decision. “This is a lawsuit that never should have happened in the first place. This should not have happened to me. They put me through a lot of undue expense and health issues.”

Although Chiasson and others affiliated with Eagle Dry Dock have suggested that the real reason by the port’s insistence – Chiasson has hinted that there was a desire to make the property available to another tenant or a new one – there is no clear suggestion of that in the countersuit now being negotiated.

“I would like to know that myself,” said attorney Jerry Herman, who represented the dry dock.

Eagle Dry Dock