Morgan v. Campbell, Campbell & Johnson

• Decision Date: 09 May 1990
• Docket Number: No. 21472-CA,21472-CA
• Citation: 561 So.2d 926
• Court: Court of Appeal of Louisiana — District of US
• Parties: Harold Gene MORGAN and Bonnie Jane Morgan, Plaintiffs-Appellants, v. CAMPBELL, CAMPBELL & JOHNSON, Defendant-Appellee.

Page 926

561 So.2d 926

Harold Gene MORGAN and Bonnie Jane Morgan, Plaintiffs-Appellants, v. CAMPBELL, CAMPBELL & JOHNSON, Defendant-Appellee.

No. 21472-CA.

Court of Appeal of Louisiana Second Circuit.

May 9, 1990.

Booth, Lockard, Politz, LeSage & D'Anna by Nyle A. Politz, Shreveport, for plaintiffs-appellants.

Campbell, Campbell & Johnson by Cecil P. Campbell and Mark O. Foster, Minden, for defendant-appellee.

Before HALL, FRED W. JONES, Jr., and HIGHTOWER, JJ.

HIGHTOWER, Judge.

Plaintiffs, Harold Gene and Bonnie Jane Morgan, appeal a summary judgment rendered against them and in favor of Campbell, Campbell & Johnson, a law firm. We reverse and remand the matter to the district court for further proceedings.

FACTS

The Morgans, husband and wife, agreed to loan Henry and Peggy Lacobee $370,000, to be secured by a mortgage on certain real estate and movables located in Webster Parish. Plaintiffs retained the services of Cecil P. Campbell and the law firm of Campbell, Campbell & Johnson to prepare the appropriate documentation for the transaction.

Pursuant to information provided by the Morgans, Mr. Campbell prepared a promissory note, the payment of which was to be secured by an instrument entitled "Mortgage Act with Homestead Waiver." That document described the mortgaged property as follows:

Township 23 North, Range 9 West Section 35: The east half of northeast quarter; northeast quarter of southeast quarter; the east 15 acres of northwest quarter of southeast quarter; also

Section 36: 72 acres, more or less, described as a tract beginning at the Northwest corner of the Northwest Quarter of Northwest Quarter, section 36, Township 23 North, Range 9 West; and thence East to Indian Creek; thence run in a Southwesterly direction with said creek to the section line between Section 35 and Section 36; thence run North to the point of beginning, being located in the West half of Northwest Quarter of Section 36, Township 23 North, Range 9 West, containing in the aggregate 207 acres, more or less, located in Webster Parish, Louisiana, with all improvements thereon and all rights thereto belonging; also

All cows, heifers, bulls and the increase thereof and additions thereto now owned and as may be hereafter acquired by mortgagors located on the lands hereinabove described, said cattle herd now consisting of approximately 500 head; also

All tractors, harvesters, hay balers, dairy farm equipment, machinery and tools now owned by mortgagors or which may be hereafter acquired and which are now or hereafter may be located on the lands above described.

The mortgage was executed on August 25, 1983 and filed with the Clerk of Court of Webster Parish four days later. The document was duly recorded in the mortgage records; it was not, however, ever recorded in the chattel mortgage records.

About three years later, when the Lacobees sought protection under Chapter 12 of the Bankruptcy Code in the United States Bankruptcy Court, the Morgans filed a proof of claim for $479,957.62 in the proceedings. Counsel for the Lacobees objected, asserting the Morgans did not have a perfected security interest to the movables, and requesting that that portion of the claim be reclassified.

After various hearings, the bankruptcy judge held that the Morgans did not have a secured interest in the movables inasmuch as the failure to record the mortgage document in the chattel mortgage records rendered it ineffective as to third persons. Accordingly, this portion of their claim was ordered reclassified.

The Morgans subsequently filed the present suit, seeking damages of $96,000, the sum allegedly lost in the bankruptcy proceedings due to failure to have a perfected security interest in the movables. The defendant law firm moved for summary judgment, asserting there was no deficiency in the description of movables and that the filing of the act of mortgage with the proper office rendered it effective as to third persons, whether or not the clerk recorded the document in the chattel mortgage records. Defendant also asserted that, since plaintiffs actually compromised their claim in bankruptcy court, they cannot now complain of their failure to recover the full amount of their claim.

In opposing summary judgment, the Morgans filed 13 documents from the bankruptcy proceedings to show they did not voluntarily compromise their claim against the Lacobees, but were forced to accept an inferior position as a result of the bankruptcy judge's rejection of the identical argument, as now posed by defendant, concerning the chattel mortgage's effectiveness. They further maintained that, absent a showing that the clerk was instructed to file the instrument in the chattel mortgage records, the blame cannot shift to that official. Instead, the Morgans asserted they had an unperfected security interest in the cattle and farm equipment as a result of the failure by defendant to have the chattel mortgage adequately recorded so as to affect third persons.

After hearing the motion, the trial court granted summary judgment and dismissed the claims against Campbell, Campbell & Johnson. This appeal ensued.

DISCUSSION

Of course, the legal principles regarding summary judgment are well settled. A motion for summary judgment is properly granted only if the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any, show that there is no genuine issue as to material fact, and that mover is entitled to judgment as a matter of law. LSA-C.C.P. Art. 966; Chaisson v. Domingue, 372 So.2d 1225 (La.1979). The burden of proof in a motion for summary judgment is on the mover to establish that there are no genuine issues of material fact. This is a difficult burden. Only when reasonable minds must inevitably concur is summary judgment warranted, and any doubt should be resolved in favor of trial on the merits. Sargent v. La. Health Serv. & Indem. Co., 550 So.2d 843 (La.App. 2d Cir.1989); Ebarb v. Erwin, 530 So.2d 1166 (La.App. 2d Cir.1988). The mover's pleadings, affidavits and documents are to be scrutinized closely while those of the opponent are to be indulgently treated. Toole v. Tucker, 519 So.2d 348 (La.App. 2d Cir.1988), writ denied, 521 So.2d 1156 (La.1988).

Summary judgment should not be utilized as a substitute for a full trial of a controverted factual issue which is material to the decision of the case. The likelihood that a party will be unable to prove his allegations at trial does not constitute a basis for entering summary judgment. Adams v. Traveler's Ins. Co., 420 So.2d 507 (La.App. 2d Cir.1982), writ denied, 422 So.2d 426 (La.1982). A motion for summary judgment is not appropriate for disposition of cases requiring a judicial determination of subjective facts such as motive, intent, good faith, and knowledge. Rogers v. Johnson, 557 So.2d 1136 (La.App. 2d Cir.1990); New South Advertising v. Krock-O-Cheese, Inc., 486 So.2d 1115 (La.App. 2d Cir.1986); Watson v. Cook, 427 So.2d 1312 (La.App. 2d Cir.1983). Nor is summary judgment appropriate for the disposition of a case in which the ultimate decision will be based on opinion evidence. Dixon v. Perlman, 528 So.2d 637 (La.App. 2d Cir.1988); Verrett v. Cameron Telephone Co., 417 So.2d 1319 (La.App. 3rd Cir.1982), writ denied, 422 So.2d 164 (La.1982).

An attorney is obligated to exercise at least that degree of care, skill and diligence exercised by prudent attorneys practicing in his community or locality. He is not required to exercise perfect judgment in every instance, but his license to practice and his contract for employment hold out to the client that he...