95 2127 La.App. 1 Cir. 5/10/96, Sonnier v. Boudreaux

• Decision Date: 10 May 1996
• Citation: 673 So.2d 713
• Parties: 95 2127 La.App. 1 Cir
• Court: Court of Appeal of Louisiana — District of US

Page 713

673 So.2d 713

95 2127 La.App. 1 Cir. 5/10/96, 30 UCC

Rep.Serv.2d 652

R.L. SONNIER v. Misty Ann BOUDREAUX, et al.

No. 95 CA 2127.

Court of Appeal of Louisiana First Circuit.

May 10, 1996.

Larry P. Boudreaux, Thibodaux, for Plaintiff-Appellant R.L. Sonnier.

Camille A. Morvant, II, Thibodaux, for Defendant-Appellee Misty Ann Boudreaux.

Before WATKINS, FOIL and TANNER, ¹ JJ.

[95 2127 La.App. 1 Cir. 2] WATKINS, Judge.

The plaintiff, Mr. R.L. Sonnier, appeals a trial court judgment failing to recognize a security interest he claims in an automobile titled to the defendant, Misty Ann Boudreaux. We reverse.

The instant dispute arose when the automobile, in which Mr. Sonnier claims a security interest, was involved in an accident which resulted in a total loss of the vehicle. Both the plaintiff and the defendant claimed the proceeds of a collision claim under an automobile insurance policy issued by Prudential Property and Casualty Insurance Company (Prudential) to Misty Ann Boudreaux. Ms. Boudreaux refused to recognize Mr. Sonnier's alleged security interest, claiming that the vehicle was a gift from Mr. Sonnier.

On September 20, 1994, Mr. Sonnier filed the instant suit, seeking recognition and enforcement of his security interest, naming Ms. Boudreaux and Prudential as defendants. In his petition, Mr. Sonnier asserts that he purchased a 1995 Plymouth automobile registered in the name of Ms. Misty Ann Boudreaux, subject to a security interest in his favor in the amount of the purchase price of $14,810.74. On June 17, 1994, the State of Louisiana issued a certificate of title recognizing his security interest. On June 25, 1994, Ms. Boudreaux was involved in a one car accident that resulted in total-loss damages to the vehicle.

Prudential issued a check payable to Ms. Boudreaux and Mr. Sonnier, in the amount of $9,923.68, representing eighty percent of the cash value of the automobile on the date of the loss, with the understanding that an additional check for the remaining twenty percent, $2,476.32, would be issued upon surrender of the certificate of title.

Mr. Sonnier alleges that he is entitled to a judgment against Ms. Boudreaux and Prudential, in the amount of $12,400.00, representing the total amount of the insurance proceeds. Mr. Sonnier also sought damages from Prudential on allegations of conversion and disposal of the salvage without his consent. ²

Ms. Boudreaux denied any security interest in the vehicle and thereafter filed a reconventional demand seeking a judgment against Mr. Sonnier for $12,400.00, representing the value of the vehicle at the time of the loss, plus storage fees and damages for mental anguish and inconvenience.

[95 2127 La.App. 1 Cir. 3] The case was tried on May 30, 1995, and on August 2, 1995, the trial judge signed a judgment in favor of Ms. Boudreaux and against Mr. Sonnier, awarding her $14,810.74 plus interest from date of judicial demand, all costs and any and all fees resulting from the storage of the vehicle. Mr. Sonnier's demand was dismissed at his cost. Mr. Sonnier appealed, alleging the following assignments of error:

1. The trial court erred in failing to recognize that Mr. Sonnier had a security interest on the vehicle.

2. The trial court erred in finding that it was Mr. Sonnier's intention to give or donate the vehicle to Ms. Boudreaux when it was purchased.

3. The trial court erred in rendering a money judgment against Mr. Sonnier instead of Prudential.

FACTS

Ms. Boudreaux and Mr. Sonnier met and became friends in late 1993. In December 1993, Mr. Sonnier and Ms. Boudreaux purchased a mobile home as co-owners. The home was placed next to Mr. Sonnier's home and Ms. Boudreaux resided there. At Mr. Sonnier's request, Ms. Boudreaux quit her day job at a day care center and her night job at a lounge. Ms. Boudreaux testified that Mr. Sonnier told her he wanted to provide for her because he "loved her like a daughter." On February 1, 1994, Mr. Sonnier and Ms. Boudreaux went shopping for a new vehicle for Ms. Boudreaux because the vehicle she owned was in need of repairs. ³ After finding a vehicle that Ms. Boudreaux liked at Morein Motors, she and Mr. Sonnier executed a retail installment contract with Ms. Boudreaux as the debtor and Mr. Sonnier as the co-debtor. Morein Motors was listed as the vendor/creditor. Ms. Boudreaux signed as the purchaser on the bill of sale and also signed the vehicle application acknowledging Morein Motor's security agreement on the vehicle. A certificate of title was subsequently issued with Ms. Boudreaux as the owner and Morein Motors as a lienholder. Insurance was obtained for the vehicle in Ms. Boudreaux's name and paid for by Mr. Sonnier.

On June 7, 1994, Mr. Sonnier paid off the lien in favor of Morein Motors. At that time he and Ms. Boudreaux executed another retail installment contract identical in form to the contract executed on February 2, 1994. The new contract listed Ms. Boudreaux as the [95 2127 La.App. 1 Cir. 4] debtor and Mr. Sonnier as the vendor/creditor. The contract was a demand note for the full price of the vehicle with a annual percentage rate of 10 percent. Ms. Boudreaux's signature appears on the contract over the words "Debtor Signature" located in the section of the contract dealing with insurance matters. Approximately one and one-half inches below her signature in the insurance section is another blank with the words "Debtor Signs." Ms. Boudreaux did not sign in this blank. Ms. Boudreaux also signed the application for vehicle title acknowledging a lien in favor of Mr. Sonnier. A certificate of title was issued on June 17, 1994, recognizing Misty Ann Boudreaux as the owner of the vehicle and Mr. Sonnier as the lien holder.

Shortly after the vehicle was paid off, the relationship between Mr. Sonnier and Ms. Boudreaux deteriorated. Ms. Boudreaux moved back to her parents' home when Mr. Sonnier's interest in her became romantic.

Ms. Carla LeFleur, the sales manager at Morein Motors, was present during the February 2 transaction and the June 7 transaction. Ms. LeFleur testified that on June 7, 1994, Mr. Sonnier paid off the lien in favor of Morein Motors and executed the retail installment contract with Ms. Boudreaux. She stated that she explained the documents to Ms. Boudreaux and that Ms. Boudreaux did not indicate that she did not understand them. Ms. LeFleur witnessed Ms. Boudreaux's signature on all the documents executed that day. Ms. LeFleur could not explain why Ms. Boudreaux's signature was on the insurance portion of the contract instead of at the "Debtor Signs" blank. Ms. LeFleur stated that she prepared the documents, and that it was unnecessary to sign in the insurance section as it was blank and did not require a signature.

Ms. Boudreaux testified that she never intended to give Mr. Sonnier a security interest in the vehicle and that she believed it was a gift from Mr. Sonnier. She stated that she believed that the papers she signed on June 7, 1994, were necessary in order to release the vehicle from the previous mortgage. Ms. Boudreaux's mother and a friend of Ms. Boudreaux both testified that Mr. Sonnier told them that he was purchasing the vehicle for Ms. Boudreaux.

Mr. Sonnier testified that he did not intend to give the car to Ms. Boudreaux as a gift. He stated that he was purchasing it for her to use and that he intended to keep a security lien [95 2127 La.App. 1 Cir. 5] on the vehicle. Apparently, no payments were made by Ms. Boudreaux to Mr. Sonnier on the debt.

In oral reasons for judgment the trial court made the following pertinent findings of fact and conclusions of law:

This Court finds that the Plaintiff in this matter is a sixty-eight (68) year old man who entered into an amorous, but non-conjugal relationship with a nineteen (19) year old girl. There was little or no communications between the parties and what happened. The documents are mismanaged, confused and simply not clear. The Court can think of no other reason to place a vehicle in the name of this girl other than to give it to her as a gift, particularly in view of the fact that she was not working at the time. The Plaintiff insisted that she not work. He began to track her on a daily basis. He was overwhelmed by her. He was extremely interested in her. And she came by and signed a bunch of documents and decorated the paper with them. The decorations of the paper may have been at a later time and after the gift was given.

... I think she came back and signed documents carelessly and recklessly, and I think the second time she signed the documents-- ... Unfortunately, in the insurance documents which might have led to something else, there appears to be no signature by the Defendant. The insurance policy appeared to have been taken out in her name, with her as the named insured in the policy. The policy does not reflect that there is a mortgage or lien on the policy in any way whatsoever ... ⁴

The Plaintiff paid for the insurance policy, ... and in obtaining the insurance he obtained an insurance policy without naming himself as a lien holder. I think the final say in this is that since he did not name himself as a lien holder in the policy it was not his intention at that time to have a lien on the vehicle.... I think that he did a foolish thing, and he didn't take care of his business....

LAW

The law applicable to this case is found in Chapter 9 of the Louisiana Commercial Laws, which became effective January 1, 1990. Because Louisiana's version of the Uniform Commercial Code was recently enacted, little jurisprudence has developed in this area of the law. Accordingly, our research encompasses cases from other jurisdictions which we look to for guidance and explanation, remembering that one of the purposes of the Uniform Commercial Code is to make uniform the law among the various jurisdictions.

Louisiana law defines a ...