Alonzo v. Chifici
| Decision Date | 18 April 1988 |
| Docket Number | No. 87-CA-738,87-CA-738 |
| Citation | 526 So.2d 237 |
| Parties | Charles ALONZO and CPA Construction Company v. Frank CHIFICI, Deanie's Restaurant, Inc. and Deanie's Take-Out, Inc. 526 So.2d 237 |
| Court | Court of Appeal of Louisiana — District of US |
James E. Shields, Gretna, for plaintiff-appellee Charles Paul Alonzo.
David C. Loeb, Susan M. Chehardy, William C. Harrison, Jr., Gauthier, Murphy, Sherman, McCabe, Chehardy & Ellis, Metairie, for defendants-appellants.
Before KLIEBERT, GRISBAUM and GOTHARD, JJ.
Frank A. Chifici, Barbara A. Chifici, Chifici Enterprises, Inc., d/b/a Deanie's Seafood Restaurant, Deanie's Seafood Carry Out Restaurant, Inc. and the Estate of Frank A. Chifici appeal suspensively from a judgment in favor of Charles Paul Alonzo and CPA Construction Co., Inc. in the amount of $328,660.80 for what the trial court characterized as the balance due on an open account, penalties, and attorneys fees arising out of the renovation of a restaurant at 1713 Lake Avenue in Metairie. For the reasons which follow we reverse the judgment of the trial court.
In April of 1982 Frank Chifici purchased "Deanie's Seafood, Inc.," a corporation which operated a restaurant at 1713 Lake Avenue in Metairie. "Deanie's Seafood, Inc." was liquidated and the business re-established as "Chifici Enterprises, Inc." in which Frank Chifici was the President and owner of a 72.3% interest. The remaining 27.7% was owned by co-investors.
In 1983 Frank A. Chifici directed the renovation (leasehold improvement) of the premises. He solicited the assistance of Charles Alonzo, a contractor who was overseeing the construction of Chifici's home on Teton Street and renovations at "Chifici's Restaurant" at 404 Magazine Street. Alonzo was the president and sole owner of CPA Construction Company, Inc. During the course of the 1713 Lake Avenue renovations, Frank Chifici underwent treatment for cancer and was absent on frequent occasions. The restaurant remained open during the renovations, which took approximately one year and were completed in September of 1984. In July of 1985 Alonzo and CPA Construction Co., Inc. filed suit for monies allegedly owed to them.
The initial petition filed by Charles Alonzo and his corporation, CPA Construction Co., Inc. was entitled "Breach of Agreement, Services Rendered, and Damages" and named as defendants Frank Chifici, "Deanie's Restaurant" and "Deanie's Takeout." 1 Plaintiffs alleged they entered into an agreement with Frank Chifici to renovate the premises at 1713 Lake Avenue and 404 Magazine Street and had acted as a contractor and renovated the premises, but had not been paid for his services, which he valued "in excess" of $300,000.00. Alternatively, plaintiffs sought recovery for unjust enrichment in the same amount. Plaintiffs also sought damages for breach of the agreement.
Frank Chifici died on September 3, 1985, less than two weeks after he was served with a copy of the petition. Plaintiffs thereafter amended the original petition to name as defendants Frank Chifici, Chifici Enterprises, Inc., d/b/a Deanie's Seafood, and Deanie's Seafood Carry-Out Restaurant, Inc., and to allege that the defendant corporations were the alter ego of Frank Chifici, who at all times was authorized to act on behalf of the corporations.
After a discovery period for which the term adversarial is an understatement, an answer in the form of a general denial was filed on behalf of the defendant corporations and the estate of Frank Chifici through its administrator, Barbara Chifici. A pre-trial memorandum by "Paul Alonzo d/b/a CPA Construction Co., Inc., a construction general contractor" explained that although he was paid a "substantial" sum for the "three jobs," material and labor costs, much less the normal profit of a contractor "were not recovered," and the outstanding balance of $500,000.00 was "acknowledged" by Frank Chifici on "several occasions."
Trial commenced on September 4, 1986. Alonzo introduced several "final invoices" for the work on the three projects which he said were approved by Frank Chifici at a meeting on December 20, 1984. During the course of plaintiffs' case in chief the trial judge allowed defendants to orally amend their answer to specifically plead the affirmative defense of extinguishment and illegality of contract, and to advance a reconventional demand for repair costs related to allegedly defective workmanship. 2 Trial was continued at the request of defense counsel, and on September 11, 1986 defendants filed an amended answer wherein they acknowledged "plaintiff" performed a portion of the renovations to the premises operated by Chifici Enterprises, Inc. (Deanie's Seafood Restaurant) pursuant to a verbal agreement with Frank A. Chifici, who was acting in his capacity of president of Chifici Enterprises, Inc. Defendants averred plaintiffs received $353,000.00 for their efforts for a net profit of $64,900.00 (23%) and reconvened against plaintiffs on the grounds:
(1) Plaintiffs were unlicensed contractors and not entitled to profits;
(2) Plaintiffs diverted funds from the renovation project for the purpose of constructing his personal residence in Slidell;
(3) Plaintiffs failed to perform in a workman-like manner, necessitating repair costs of $150,000.00
On November 10, 1986 plaintiffs filed a supplemental and amending petition seeking $470,391.21 for "Breach of Agreement, Services Rendered Damages and Alternatively Suit on Open Account Interest and Attorney Fees." The amounts due under alternative theories of recovery were enumerated as follows:
(1) Direct and Consequential Damages for Breach $202,435.42
of Agreement, Loss of Revenue
Mental 267,859.79 $470,391.21 (sic)
Anguish
Loss of
Future
Earnings
(2) Unjust Enrichment 470,391.21
(3) Non-payment on Open Account
17 Teton 267,995.79 3
1713 Lake Avenue 196,160.51
404 Magazine Street 6,274.91
$470,391.21 (sic)
Defendants filed an answer in the form of a general denial.
The trial court rendered judgment in favor of Charles Alonzo and CPA Construction Company, Inc., and against Frank Chifici, Barbara Chifici, Chifici Enterprises, Inc., Deanie's Seafood Carry-Out Restaurant, Inc., and the estate of Frank Chifici. In reasons for judgment the court enunciated its finding that an oral contract existed between Alonzo and Chifici to renovate 1710 (sic) Lake Avenue and that Alonzo performed in a workmanlike manner. 4 The court characterized the contract as an open account because Alonzo billed costs to "Chifici's" account, who made payments on the balance due. The court concluded Alonzo was entitled to "the balance due ... penalties and attorney's fees" totaling $328,660.80. Finally, the court found the evidence produced at trial warranted piercing the corporate veil and declared the defendant corporations to be the alter ego of Barbara and Frank Chifici.
At the outset we note that the judgment as against two of the judgment debtors is an absolute nullity. Barbara Chifici was not a named defendant and cannot be cast in judgment. Luneau v. Hanover Ins. Co., 478 So.2d 752 (La.App. 3rd Cir.1985); Champagne v. Lee, 470 So.2d 378 (La.App. 5th Cir.1985). Frank A. Chifici died prior to judgment, and a judgment cannot be rendered for or against a deceased person. White v. Givens, 491 So.2d 63 (La.App. 1st Cir.1986). Accordingly, the portion of the judgment naming Barbara Chifici and Frank Chifici as judgment debtors is declared a nullity and is vacated and set aside. Thus, the only remaining valid defendants are the estate of Frank Chifici, Chifici Enterprises, Inc., and Deanie's Seafood Carry-out Restaurant, Inc.
We attempted to compute how the trial court arrived at the award of $328,660.80 but were unable to do so. The amount claimed on open account for 1713 Lake Avenue was $196,160.00, and the maximum possible penalty under LSA-R.S. 9:2784 was $29,424.00 (15%). Thus, the attorney's fees would exceed $100,000.00. At our request the parties submitted post-argument memorandums on the issue; neither side was able to explain how the amount of the award was determined. Defendants averred the multitude of figures bandied about by plaintiff in his pleadings and when testifying at trial makes it impossible to determine the manner in which the total award was computed. Plaintiffs launch into a discourse whereby they take the invoiced amount for 1713 Lake Avenue ($196,160.00) and add various percentages of profit and overhead to reach totals approximating $328,000.00; however, contrary to counsel's contentions, profit and overhead were figured into the "open account" invoice, as evinced by Alonzo's trial testimony. 5 Thus, neither side is able to provide any insight as to how the award was computed. In any event, we find that the record does not support an award in plaintiff's favor.
That an oral contract existed for the renovation of 1713 Lake Avenue was admitted by the defendants. The trial court concluded the parties to the contract were Charles Alonzo and Frank Chifici. We agree these two individuals made the agreement, but in their capacity as corporate presidents rather than as individuals. Alonzo was aware Frank Chifici was president of the corporate entity which owned the restaurant and that there were other shareholders. Alonzo averred in his original petition that Chifici had the authority to enter into the agreement on behalf of Chifici Enterprises, Inc. The checks issued in payment for the work were drawn on the Chifici Enterprises, Inc. account and bore that name. Alonzo testified he personally made deposits of sales receipts...
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