Larocca v. La. Motor Vehicle Comm'n
| Decision Date | 10 May 2023 |
| Docket Number | 22-CA-197 |
| Parties | JOSEPH LAROCCA AND LOROCCA AUTO SALES, INC. v. LOUISIANA MOTOR VEHICLE COMMISSION |
| Court | Court of Appeal of Louisiana — District of US |
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JOSEPH LAROCCA AND LOROCCA AUTO SALES, INC.
v.
LOUISIANA MOTOR VEHICLE COMMISSION
No. 22-CA-197
Court of Appeals of Louisiana, Fifth Circuit
May 10, 2023
ON APPEAL FROM THE TWENTY-FOURTH JUDICIAL DISTRICT COURT PARISH OF JEFFERSON, STATE OF LOUISIANA NO. 819-515, DIVISION "O" HONORABLE DANYELLE M. TAYLOR, JUDGE PRESIDING
COUNSEL FOR PLAINTIFF/APPELLEE, LOROCCA AUTO SALES, INC. Robert G. Harvey, Sr.
COUNSEL FOR DEFENDANT/APPELLANT, LOUISIANA MOTOR VEHICLE COMMISSION Adrian F. LaPeyronnie, III
Panel composed of Judges Robert A. Chaisson, Stephen J. Windhorst, and John J. Molaison, Jr.
STEPHEN J. WINDHORST JUDGE
Appellant, Louisiana Motor Vehicle Commission, appeals the trial court's March 10, 2022 judgment, which reversed and dismissed an administrative adjudication against appellee, LaRocca's Auto Sales, Inc. For the reasons that follow, we affirm in part the trial court's judgment dismissing the administrative adjudication. The trial court's judgment is reversed in part and remanded for further proceedings as to the award of costs and attorney's fees.
PROCEDURAL HISTORY and FACTS
This appeal involves an administrative proceeding before the Louisiana Motor Vehicle Commission (herein after "LMVC" or "the Commission"). The Commission is the state agency that is authorized to enforce the Louisiana Motor Vehicles Sales Finance Act ("LMVSFA"), La. R.S. 6:969.1, et seq.[1] The Commission's executive director filed a complaint and notice of hearing charging LaRocca's Auto Sales, Inc. ("LaRocca's Auto") with a violation of La R.S. 6:969.35. The complaint alleged that "since at least October 2019" LaRocca's Auto has been engaging in the business of making consumer loans and/or origination of consumer credit sales without first having acquired a sales finance license as required under the LMVSFA.
The following facts and evidence were adduced at the March 8, 2021 hearing before the Commission.
Antoine Derouen, a compliance investigator with the Commission, testified he was advised by the Commission's licensing department that LaRocca's Auto was offering financing on its website. The licensing department requested that he visit LaRocca's Auto's premises to investigate and determine if LaRocca's Auto is required to obtain a sales finance license. He was also informed that the address for
LaRocca's Auto, 2604 West Napoleon, in Metairie, was the same address as Car City Autoplex ("Car City") and that they shared the same inventory based on their respective websites.
Mr. Derouen testified that on October 14, 2019, prior to visiting LaRocca's Auto's premises, he reviewed the websites for LaRocca's Auto and Car City. He determined that they shared the same inventory and confirmed that LaRocca's Auto's website offered financing. Mr. Derouen stated that the website offered financing through an online application with a link that stated "Apply Online." The link redirected him to the "loan application page," which he printed. He testified that this application indicates to the Commission that LaRocca's Auto is offering financing.
Mr. Derouen stated he also called the phone number listed on LaRocca's Auto's website to "shop the dealership for financing" and an individual answered "Car City Autoplex." He informed the individual that he called the phone number for LaRocca's Auto. The individual identified himself as Frank Amos and stated that he was the manager of LaRocca's Auto and Car City. Mr. Amos informed him that both businesses "shared the same phone number that - you could obtain the same vehicle, and that he handles both." Mr. Derouen stated that he wanted to view a vehicle and was told to make an appointment online. Mr. Amos told him that he could complete the application online "to speed up the process. That way, they would already have my credit run and see how much I was approved for ahead of time." Based on the information he acquired, Mr. Derouen determined that he should visit LaRocca's Auto and advise the owner that a sales finance license was required.
Upon arrival at LaRocca's Auto, Mr. Derouen spoke with Mr. Amos, who remembered him because Car City recently obtained a sales finance license. Mr. Derouen testified that Mr. Amos confirmed that he was the manager for LaRocca's
Auto and Car City, that he handles the daily operations for both businesses, and that both businesses were originating loans. Mr. Derouen informed Mr. Amos that a sales finance license was required and gave him an application to be completed by the owner of LaRocca's Auto, Joseph LaRocca, within 30 days. Mr. Amos indicated that he would assist Mr. LaRocca with completing the application because he recently obtained a sales finance license for Car City. Later during his testimony, Mr. Derouen testified that Mr. Amos stated that "since he handled the day to day administrative duties for Mr. LaRocca he would be the one completing it." While he was at LaRocca's Auto's premises, Mr. Derouen took two photographs of a "LaRocca Auto Sales" sign on the building shared by LaRocca's Auto and Car City.
Mr. Derouen again spoke with Mr. Amos a few days later and was informed that Mr. LaRocca was not present, but that Mr. LaRocca was given the application. He followed up on November 15, 2019, and Mr. Amos notified him that they needed additional time to submit the application. He informed Mr. Amos that he needed to speak with Mr. LaRocca, who called him back "a couple of hours later." Mr. LaRocca stated that there was "some confusion between him and Mr. Amos" and he "only received the application two days prior" and he requested an additional two weeks. When the application was not received, Mr. Derouen testified that he attempted to contact Mr. LaRocca at his place of business and spoke with Mr. Amos. Mr. Amos informed him that the application was complete, but Mr. LaRocca was attempting to obtain additional documents. Mr. LaRocca was granted an additional two-week extension. However, when he followed up, Mr. Amos told him that Mr. LaRocca obtained an attorney and would not be filing the application.
At the hearing, Mr. Derouen was shown the website, which still contained a link to "Apply Online" for financing. However, when the page was redirected, the loan application listed Car City instead of LaRocca's Auto. Although the website contained this change, the loan application page still had LaRocca's Auto's name
right above it and the application had not been removed from the website. Mr. Derouen testified that LaRocca's Auto is offering financing due to the loan application being on its website. He testified that the determining factor is that the loan application was on its website and according to "LMVC law," LaRocca's Auto was originating loans. He stated that offering and taking loan applications is "a part of originating," which requires a license. Mr. Derouen stated that as of the date of this hearing, a loan calculator, which calculates payments, was now also offered on the website. Mr. Derouen testified that in his opinion the "mere offering" of finance is sufficient to trigger a violation of the statute if a sales finance license is not obtained under the law.[2]
On cross examination, when asked if LaRocca's Auto is "making a consumer loan," Mr. Derouen replied "Yes, sir. His business is offering financing." He testified that "Mr. LaRocca via his website and the used car dealership is offering financing to consumers." Mr. Derouen affirmatively stated that his evidence that LaRocca's Auto was "making a consumer loan" was the blank application on the website with the business' name on the application. Mr. Derouen testified that LaRocca's Auto's manager, Mr. Amos, confirmed that LaRocca's Auto was "offering financing via the website," and he "handles all day-to-day operations" for LaRocca's Auto. Mr. Derouen conceded that he did not find nor attempt to locate a loan application filled out by Mr. LaRocca on behalf of LaRocca's Auto. He testified that "originating a loan" constitutes "taking the application and then forwarding it." When questioned about the language in La. R.S. 6:969.35 that specifically refers to a fine for "each contract originated," Mr. Derouen conceded that he did not find any contracts completed by Mr. LaRocca on behalf of LaRocca's
Auto. Mr. Derouen stated LaRocca's Auto is in violation of the statute because the "website has a blank application" for financing, which a consumer can complete. He testified that under "LMVC law that is offering financing, and also constitutes originating a loan." He stated that "offering financing" constitutes the "beginning of originating the loan," and therefore, LaRocca's Auto is required to obtain a sales finance license.
Mr. Derouen acknowledged that the phone number on the website [504-3040094] was answered "Car City Autoplex," not LaRocca's Auto. He stated that when he asked, Mr. Amos confirmed that LaRocca's Auto and Car City share the same phone number and the same building." Mr. Amos advised that Mr. LaRocca owned the lot that his dealership, Car City, is currently located and that he is the manager and handles the daily operations for both businesses. When he inquired as to how the sale of the vehicles would be handled since the inventory and price were the same on both websites, Mr. Amos informed him that "he was the one that made the final determination." Mr. Amos further confirmed that LaRocca's Auto and Car City both originate loans. Based on his conversation with Mr. Amos, Mr. Derouen stated that he did not investigate further to determine if the number listed was in fact LaRocca's Auto's phone number. He also testified that based on statements by Mr. Amos and the LaRocca's Auto sign on the building, he "knew" LaRocca's Auto "was operating out of that location." He further acknowledged that he did not investigate the website. He testified that he did not know how to determine the owner of the website...
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