Agrifund, LLC v. Radar Ridge Planting Co.
| Decision Date | 17 July 2019 |
| Docket Number | No. 52,432-CA,52,432-CA |
| Parties | AGRIFUND, LLC, Plaintiff-Appellant v. RADAR RIDGE PLANTING CO., INC. and Thomas A. Dickerson, Defendants-Appellees |
| Court | Court of Appeal of Louisiana — District of US |
BREITHAUPT, DUBOS, & WOLLESON, LLC By: Robert Alan Breithaupt, Michael Lee DuBos, James R. Close, Jared S. Scheinuk, Monroe, Counsel for Appellant
MIXON, CARROLL & FRAZIER, PLLC By: James E. Mixon, James L. Carroll, Rossanna R. McIlwain, Columbia, Counsel for Appellee Caldwell Bank & Trust Company
LAW OFFICE OF BRIAN E. CRAWFORD By: Brian E. Crawford, Monroe, Counsel for Appellee Franklin State Bank & Trust Company
PETTIETE, ARMAND, DUNKELMAN, WOODLEY, BYRD, & CROMWELL, L.L.P. By: Joseph S. Woodley, Shreveport, Counsel for Appellee Commercial Capital Bank
COOK, YANCEY, KING, & GALLOWAY By: Bernard S. Johnson, Lisa Conly Cronin, Shreveport, Counsel for Appellee Clark A. McCain
SMITH & ASSOCIATES By: Leroy Smith, Jr., Tallulah, Counsel for Appellee Danny A. Dickerson
HAMMONDS, SILLS, ADKINS, & GUICE By: Jon Keith Guice, Justin N. Myers, Linda K. Ewbank, Monroe, Counsel for Appellee Brian Wilson
FRILOT, LLC By: David S. Daly, Elliot M. Lonker, New Orleans, Counsel for Appellees David S. Stephens, Lawrence W. Pickett, Jr., and Lawrence W. Pickett, Jr., APAC
SAMUEL T. SINGER, Winnsboro, Counsel for Appellee Franklin State Bank & Trust Company
MICHAEL E. KRAMER, Winnsboro, Counsel for Appellee Franklin State Bank & Trust Company
Before PITMAN, GARRETT, STONE, COX, and McCALLUM, JJ.
This case arises from agricultural loans that were not repaid. The lender, Agrifund, LLC ("Agrifund"), appeals from a trial court judgment granting exceptions of no cause of action as to its claims against eight of the numerous defendants in this case, and the dismissal of those defendants with prejudice. For the reasons stated below, we affirm in part and reverse in part. We find that the plaintiff has alleged a cause of action in conversion against the three banks named as defendants. We find that the plaintiff has not alleged any other causes of action against any of the defendants who filed the exceptions that are before us. The matter is remanded to the trial court for further proceedings.
This matter began on April 14, 2016, with a ten-page petition filed by an agricultural lender, Agrifund, against Radar Ridge Planting Company, Inc. ("Radar Ridge"), a farming entity, and Thomas A. Dickerson ("Dickerson"), as guarantor, to collect money owed under a delinquent agricultural loan and for recognition of a security interest on agricultural products secured under the UCC. The original suit, grounded on promissory notes and security agreements, consisted of 47 paragraphs.
The matter lay dormant until March 1, 2017, when Agrifund filed a "First Supplemental and/or Amended Petition." This pleading adopted all of the original allegations and added 22 additional pages of allegations, for a total of 102 paragraphs of allegations. This petition added 21 additional defendants, whom we will refer to as the (1) Dickerson entities, (2) banks and bank employees with whom Dickerson and his entities did business ("bank defendants"), and (3) accountants who provided services for Dickerson and his entities ("accounting defendants"). This petition sought damages against the added parties under different legal theories designated as counts. Count One alleged fraud and conspiracy to commit fraud, Count Two alleged racketeering, Count Three alleged unfair trade practices under the Louisiana Unfair Trade Practices Act ("LUTPA"), and Count Four alleged conversion. The petition recited a lengthy history of events in an effort to establish liability on the part of all of the added parties, in addition to still seeking relief against the original defendants on the notes and security interests and damages. The thrust of the amended petition was that the conduct on the part of the added parties either facilitated, caused, or contributed to a massive fraudulent scheme perpetrated by Dickerson against Agrifund.
Exceptions of no cause of action filed by the banking and accounting defendants were sustained by the trial court, which dismissed the claims, but allowed Agrifund time to amend.
On November 29, 2017, Agrifund filed a "Second Supplemental and Amended Petition," which amended many of the existing paragraphs and added additional paragraphs, for a total of 234 numbered paragraphs, in an effort to address the deficiencies noted by the trial court in its opinion sustaining the exceptions. In response, the same exceptors filed more exceptions of no cause of action. The trial court again sustained the exceptions and dismissed the plaintiff's claims against the exceptors.1
Agrifund appealed. Voluminous briefs and reply briefs were filed. This case was initially argued before a three-judge panel. Pursuant to La. Const. Art. 5, Section 8 (B), the case was later reassigned to a five-judge panel. Additional briefs were filed. The matter was argued again before the five-judge panel. More briefs were then filed. Hence, a rather unusual delay in handling the appeal has occurred in this case.
The narrow issue before us is whether the trial court erred in sustaining the exceptions of no cause of action filed by the banking and the accounting defendants and dismissing the plaintiff's claims as to these parties.
Following our de novo review, and guided by the well-established legal precept that we must assume that all of the well-pled factual allegations are true, we ultimately find that the plaintiff has alleged a cause of action for a claim in conversion against the three banks. This cause of action was pled only against the banks. In all other respects, we find that the plaintiff has not alleged any other causes of action against any of the exceptors under the other legal theories pled by Agrifund.
To evaluate whether the trial court correctly sustained the exceptions in this matter, a detailed examination of all three petitions is necessary. This task is complicated because the petitions are not succinctly stated or artfully drawn. Further, none of the loan documents, promissory notes, agricultural security agreements, UCC-1F forms, guaranty agreements, or checks described below were attached to the pleadings. The trial court chose to rule on the exceptions of no cause of action and pretermitted ruling on the numerous other exceptions which address some of these deficiencies, so they are not before us.
According to the original petition, in 2015, Agricultural Resource Management ("ARM") extended a crop production loan for that year to Dickerson and one of his farming entities, Radar Ridge. ARM filed a UCC-1F form perfecting its security interest in all future crops and future Farm Services Agency ("FSA") payments for the defendants' cotton, soybean, corn, and rice crops grown in Morehouse, Franklin, and Richland Parishes. In January 2016, the parties agreed to convert the crop production loan to a crop storage loan with Agrifund, an affiliate of ARM. In February 2016, it was discovered that the defendants did not have the grain in storage that they claimed. In April 2016, Agrifund filed its original petition against Dickerson and Radar Ridge seeking payment of the delinquent notes, recognition of its security interests, and damages for nonpayment of the loan.
As set forth above, Agrifund filed a first supplemental and amended petition adding numerous defendants, including Dickerson's father, Danny A. Dickerson, and the "Dickerson entities" comprised of Dickerson Ag Inc.; Kelley Ag Service, Inc.; Dickerson Farming Partnership; Dickerson Agricultural Partnership; B & T Farms, LLC; Tough Luck Farms, LLC ("Tough Luck"); W & T Farms, LLC; Yes Farms, LLC ("Yes Farms"); Tibb Co. Farms, LLC; High Flyers, Inc. ("High Flyers"); and Number Two Farms, LLC ("Number Two Farms"). Agrifund also named as defendants the "bank defendants" comprised of several banks and bank employees, including Clark A. McCain, an employee of Franklin State Bank and Trust Company; Franklin State Bank and Trust Company ("FSB"); Commercial Capital Bank ("Commercial Capital"); Brian Wilson, an employee of Caldwell Bank and Trust Company; and Caldwell Bank and Trust Company ("Caldwell Bank"). Agrifund also included as defendants the "accounting defendants" comprised of Dickerson's accountants and accounting firm, David S. Stephens; Lawrence W. Pickett, Jr.; and Lawrence W. Pickett, Jr., a Professional Accounting Corporation. Finally, Agrifund named as a defendant Crop Production Services, Inc. ("Crop Production Services"), an entity associated with FSB.
Regarding the accounting defendants, Agrifund alleged that they performed accounting services for Dickerson and his entities and conspired with Dickerson in preparation for the 2015 crop year to organize farming entities to engage in improper, fraudulent, and deceptive acts and practices with respect to acquisition of crop loans, conduct of operations, sale of crops, and allocation and disbursement of proceeds from the sale of crops. Agrifund contended that the accounting defendants aided in reactivating High Flyers, an inactive corporation, without the knowledge of the registered agent, William J. Casiday, and used Casiday's tax identification number to defraud creditors, kite checks, launder money, and abscond with the proceeds from crops that were pledged as security for loans. It alleged that the accounting defendants added Scott and Theresa Higdon as partners in the Dickerson Agricultural Partnership without their knowledge, submitted fraudulent documents to FSA to participate in government crop and crop insurance programs, forged signatures on loan documents submitted to FSB, forged signatures to open an account with Crop Production Services, and forged signatures for a loan with Commodity Credit Corporation.
As to the bank defendants, Agrifund alleged that McCain, an employee of FSB, signed loan documents...
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