93 1270 La.App. 1 Cir. 6/23/95, Bass v. Coupel

• Decision Date: 23 June 1995
• Citation: 671 So.2d 344
• Parties: 93 1270 La.App. 1 Cir
• Court: Court of Appeal of Louisiana — District of US

Page 344

671 So.2d 344

93 1270 La.App. 1 Cir. 6/23/95

Billy R. BASS and Judy H. Bass v. Dudley COUPEL and Rosa Coupel.

No. 93 CA 1270.

Court of Appeal of Louisiana First Circuit.

June 23, 1995.

Rehearing Denied Nov. 30, 1995.

Writ Denied March 15, 1996.

Robert L. Freeman, Lisa Koch, Baton Rouge, for appellees, Billy and Judy Bass.

William O. Templet, Plaquemine, and Dana K. Larpenteur, Plaquemine, for appellants, Dudley and Rosa Coupel.

Before: CARTER, GONZALES, WHIPPLE, PARRO and REDMANN ¹, JJ.

[93 1270 La.App. 1 Cir. 2] GONZALES, Judge.

On or about December 11, 1981, Billy R. and Judy H. Bass purchased property in Iberville Parish from Dudley and Rosa Coupel. On September 26, 1990, the Basses filed suit against the Coupels, alleging (among other things) that "prior to and at the time of the aforementioned sale, defendants made intentional and false representations as to the status of the property."

On October 24, 1990, the Coupels filed a peremptory exception raising the objection of no right of action and a peremptory exception raising the objection of prescription, both of which were denied in a judgment dated May 15, 1991. The Coupels filed a second peremptory exception raising the objection of prescription on October 17, 1991. This second peremptory exception raising the objection of prescription was referred to the merits by the trial court. After a trial on the merits, the trial court rendered judgment in favor of plaintiffs, awarding $20,000 for "Rescission of the sale and return of purchase price of the land[;]" $11,454 for "Closing cost[s] from the sale of the land and incidental improvements made upon land[;]" $10,000 for "Damages for mental anguish and for the loss of use and enjoyment of the land[;]" and $13,679 for "Attorneys fees associated with the adjudication of this case[.]" The judgment was signed on July 13, 1992. The second peremptory exception raising the objection of prescription was denied in that same judgment.

The Coupels filed a motion for new trial on July 22, 1992. The motion for new trial was denied on December 22, 1992. The Coupels filed a motion for suspensive appeal on January 15, 1993. The Coupels make the following assignments of error:

1. The trial court erred in failing to apply the five year prescriptive period for nullity of contracts on the basis of fraud or misrepresentation under La.C.C. art. 2032.

2. The trial court erred in failing to hold that the flooding of the property was a redhibitory defect subject to a prescriptive period of one year from the date of sale or discovery of the defect.

3. The trial court erred in categorizing the flooding of the property subsequent to the date of sale as fraud because no evidence was presented at trial to show that the property ever [93 1270 La.App. 1 Cir. 3] flooded prior to the sale, or that the Coupels had any knowledge of the property flooding prior to the sale.

4. The trial court erred in failing to find that the flooding was a redhibitory defect, but not a defect sufficient to justify setting aside the sale because the plaintiffs continued to use the property.

5. The trial court erred in finding the failure to perform future acts pertaining to subdivision improvements constituted fraud, rather than merely promises to perform in the future.

6. The trial court erred in awarding attorney's fees in a fraud case in which the alleged cause of action arose prior to the 1984 amendments to the Louisiana Civil Code, particularly, La.C.C. art. 1958 and the comments thereunder. ²

THE LAW GOVERNING THE CASE

This case is a suit on a contract of a sale of immovable property. Ordinarily, a suit on a contract is limited to the four corners of the contract, and within the confines of the written contract, the plaintiff has no claim whatsoever for either reformation or rescission. However, the petition makes general allegations of fraud, ³ and based on these allegations, seeks first to reform, and then to rescind, the contract. Louisiana Civil Code article 1778 provided at the time of the sale:

Certain contracts are regulated by particular rules which are established in the parts of the Code which treat of those contracts.

The rules of Book III, Title IV (Of Conventional Obligations ) generally applied unless special rules modified or departed from them. This contract was governed by the special rules found in Title VII, "Of Sale." See La.C.C. arts. 2438 et seq. in effect at the time of the sale.

The purchaser, Mr. Bass, is not entitled to multiple recoveries under several different legal theories, as occurred in this case. We will analyze this case in three different parts: first, the flooding claims; second, the "approved" subdivision claims; and third, the future improvements claims.

[93 1270 La.App. 1 Cir. 4] THE FLOODING CLAIMS

First, Mr. and Mrs. Bass claim that Mr. Coupel told Mr. Bass the property did not flood. Among the remedies sought by Mr. and Mrs. Bass and granted by the trial court was, first, rescission of the sale. As to this portion of the plaintiffs' cause of action, the law on sales which governed at the time of the sale is found in La.C.C. art. 2547, ⁴ which provided:

A declaration made by the seller, that the thing sold possesses some quality which he knows it does not possess, comes within the definition of fraud, and ought to be judged according to the rules laid down on the subject, under the title: Of Conventional Obligations.

It may, according to the circumstances, give rise to the redhibition, or to a reduction of price, and to damages, including reasonable attorneys' fees, in favor of the buyer. (Emphasis added.)

This article is a special provision contained in Title VII. This article governs a sale, where there is a declaration by the seller that the object of the sale possesses some quality which he knows it does not possess. It requires that the plaintiffs prove that Mr. Coupel knew that the land flooded prior to the time of his non-flooding representation. Mr. and Mrs. Bass do not allege this knowledge, and there is absolutely no proof in the record of this knowledge. ⁵ Mr. Coupel was not even asked at his deposition if he knew the land [93 1270 La.App. 1 Cir. 5] flooded, and the trial court did not find as a fact any fraudulent representations regarding the flooding issue. ⁶

At the time of the sale, La.C.C. art. 2547 (fraud in sales) and La.C.C. art. 1847 [93 1270 La.App. 1 Cir. 6] (general fraud) required scienter ⁷ or guilty knowledge. Thus fraud cannot be predicated on mere mistake or negligence however gross, and it is generally held that a fraudulent intent, an intent to deceive, or the equivalent thereof, is an essential element of fraud. 37 C.J.S. § 22(a) (footnotes omitted).

To find fraud as to the non-flooding representation, La.C.C. art. 1847 (the law governing at the time of this sale) required an error bearing on a material part of the contract created by artifice. In this respect, artifice as defined in La.C.C. art. 1847 is "either an assertion of what is false, or a suppression of what is true...."

An intent to defraud has always been a part of the law of fraud. See Hall v. Arkansas-Louisiana Gas Company, 368 So.2d 984, 993 (La.1979); Buxton v. McKendrick, 223 La. 62, 64 So.2d 844, 846 (La.1953); Boucher v. Division Of Employment Security, Department of Labor, 169 So.2d 674, 679 (La.App. 1st Cir.1964), writ denied 247 La. 356, 171 So.2d 476 (La.1965); Farwell v. Milliken & Farwell, Inc., 145 So.2d 644, 648 (La.App. 4th Cir.1962); Colvin v. Division of Employment Security, Department of Labor, 132 So.2d 909, 911 (La.App. 1st Cir.1961); Walton v. Bufkin, 135 So.2d 309, 311 (La.App. 2d Cir.1961); Swain v. Lindsay, 85 So.2d 360, 361 (La.App. 2d Cir.1956).

Actual fraud is intentional fraud, an intent to deceive being the essential element thereof. 37 C.J.S. § 2(b) (footnotes omitted.) Fraud is defined in part as:

(1) The suggestion, as a fact, of that which is not true, by one who does not believe it to be true ... (3) The suppression of that which is true, by one having knowledge or belief of the fact. (4) A promise made without any intention of performing it.

37 C.J.S. § 2(b).

Accordingly, Mr. and Mrs. Bass had to allege and prove that Mr. Coupel knew that the land flooded in order for his statement to be an artifice. If Mr. Coupel did not know the land flooded, his statement cannot be false. Thus, as there is absolutely no [93 1270 La.App. 1 Cir. 7] evidence in the record indicating that Mr. Coupel knew the land flooded, there has been no artifice, and therefore, no fraud.

"APPROVED," "TRUE," "BONA FIDE" SUBDIVISION

The main focus of plaintiffs' fraud allegations are contained in the following paragraphs of their petition:

3.

Prior to and at the time of the aforementioned sale, defendants made intentional and false representations as to the status of the property, to-wit: that the property purchased by plaintiffs was part of an existing, authorized, and approved subdivision, when, in fact, it was not duly approved as a subdivision, and currently remains unauthorized as a subdivision.

4.

Prior to and at the time of the sale, defendants recorded or caused to be recorded a plat of the purported subdivision, of which plaintiff's property was a part, with said plat falsely indicating that this land, which included plaintiff's property, was an authorized subdivision.

5.

Said plat is recorded in Conveyance Book 324, Entry 15, Iberville Parish, Louisiana and entitled "FINAL PLAT OF CHOCTAW SUBDIVISION LOTS C-1-A, C-6 THRU C-26."

6.

Said recorded plat contains the following certification: "This is to certify that this Plat is made in accordance with La.Revised Statues 33:5051 et. seq. and conforms to all parish ordinances governing this subdivision of land."

7.

In law and in fact, this subdivision has never been approved and does not conform to the Iberville Parish Subdivision Regulations.

8.

The Iberville Parish Subdivision Regulations in effect at the...