Travcal Properties, LLC v. Logan

• Decision Date: 06 October 2010
• Docket Number: No. 10-323.,10-323.
• Citation: 49 So.3d 466
• Parties: TRAVCAL PROPERTIES, LLC v. Gregory J. LOGAN, et al.
• Court: Court of Appeal of Louisiana — District of US

49 So.3d 466

TRAVCAL PROPERTIES, LLC

v.Gregory J. LOGAN, et al.

No. 10-323.

Court of Appeal of Louisiana, Third Circuit.

Oct. 6, 2010.

Rudie Ray Soileau, Jr., Lundy, Lundy, Soileau & South, LLC, Lake Charles, LA, Counsel for Defendant Appellee: Gregory J. Logan.

Kenneth Warren DeJean, Attorney at Law, Lafayette, LA, Counsel for Defendant Appellee: Hit or Miss, LLC.

Francis X. Neuner, Jr., Laborde & Neuner, Lafayette, LA, Counsel for Defendant Appellee: William E. Logan Jr. (Trustee for Sa-Jes).

Michael Reese Davis, Hymel Davis & Petersen, LLC, Baton Rouge, LA, Counsel for Plaintiff Appellant: Travcal Properties, LLC.

Camille Bienvenu Poche', Babineaux, Poche', Anthony & Slavich, Lafayette, LA, Counsel for Defendant Appellee: Gregory J. Logan.

Tim P. Hartdegen, Hymel Davis & Petersen, LLC, Baton Rouge, LA, Counsel for Plaintiff Appellant: Travcal Properties, LLC.

Daniel J. Poolson, Jr., Laborde & Neuner, Lafayette, LA, Counsel for Defendant Appellee: William E. Logan Jr. (Trustee for Sa-Jes).

Court composed of JOHN D. SAUNDERS, MARC T. AMY, and ELIZABETH A. PICKETT, Judges.

SAUNDERS, Judge.

**1 Herein, we address whether the Calcasieu Parish court abused its discretion in sustaining an exception of lis pendens in favor of the Appellees, Gregory Logan andWilliam Logan. For the following reasons, we find that it did not and affirm the trial court's ruling.

FACTS AND PROCEDURAL HISTORY:

At issue before this court is an exception of lis pendens sustained by the trial court in favor of the Appellees, Gregory Logan and William Logan. The matter arises out of a dispute over the management and operation of Hit or Miss, L.L.C. (hereinafter referred to as "Hit or Miss"), a Wyoming limited liability company—specifically, Gregory Logan's status as manager of the company and the authority with which the position carries.

Hit or Miss is owned in equal parts by Travcal Properties, L.L.C. (hereinafter referred to as "Travcal") and The Sa-Jes Trust (hereinafter referred to as "Sa-Jes"). Travcal is a single member Louisiana limited liability company that is owned by Texada Trust and managed by Edwin K. Hunter. Gregory Logan is the initial income beneficiary of Sa-Jes.

The dispute between the parties began when Gregory Logan was notified that he would no longer continue to serve in the role as manager of Hit or Miss. The company's operating agreement stated that Gregory Logan would serve as the initial manager of the company until such time as his successor was elected and qualified.

Legal action commenced on April 9, 2009, when Gregory Logan filed a petition in Lafayette Parish seeking a declaratory judgment confirming his authority to continue to serve as manager of Hit or Miss until such time as a successor manager is elected and qualified. Gregory Logan named Hit or Miss and its two members, **2 Travcal and William Logan (as trustee of Sa-Jes), as defendants in the original petition.

On May 7, 2009, Travcal filed a derivative suit in Calcasieu Parish alleging various acts of mismanagement and breaches of fiduciary duties by Gregory Logan.

On June 11, 2009, Gregory Logan filed an amended petition in the Lafayette Parish proceeding. In the amended petition, Gregory Logan expanded on the original claim by seeking specific rulings confirming his authority as manager of Hit or Miss and relating to certain actions taken by him in that capacity. Included in the amended petition are requested rulings on the following: (i) that no person other than the duly-appointed manager of Hit or Miss has the right to act for, or on behalf of Hit or Miss, or to take any action enumerated in Section 3.1(b) of the Operating Agreement for or on behalf of Hit or Miss; (ii) that Travcal has no right or authority to take any action by or on behalf of Hit or Miss; and specifically that Travcal had no right or authority to register Hit or Miss to do business in the State of Louisiana, to designate a principal business address in the State of Louisiana or to appoint a registered agent for Hit or Miss in the State of Louisiana; (iii) that Appellee, as the manager of Hit or Miss has authority under the Operating Agreement to establish a working capital reserve for Hit or Miss and to withhold such amounts from distributions to the members of Hit or Miss; and, (iv) that Appellee, as manager of Hit or Miss, properly classified payments made by certain Mexican entities to Hit or Miss as ordinary income on the tax filings of Hit or Miss and on the K-1s issued to the members of Hit or Miss.

William Logan, on June 19, 2009, in response to Gregory Logan's amended petition, filed an answer and cross-claim against Travcal in the Lafayette Parish **3 proceeding. Among other things, the cross-claim sought a declaratory judgment (i) confirming Gregory Logan as managerof Hit or Miss and confirming that Gregory Logan will continue to serve as manager of Hit or Miss until such time as his successor may be elected and qualified, (ii) declaring that no person other than the duly appointed and qualified manager of Hit or Miss has a right to act for or on behalf of Hit or Miss, (iii) declaring that Gregory Logan, as manager of Hit or Miss, is the sole person to act for and on behalf of Hit or Miss, (iv) declaring that the members of Hit or Miss, in their capacity as members, do not have the authority to act for or on behalf of Hit or Miss.

Travcal responded to the amended petition and cross-claim by filing an exception of lis pendens in the Lafayette parish court. A hearing on the exception was held on August 17, 2009, and the court overruled the exception on August 24, 2009. Thereafter, Travcal requested supervisory writs with this court regarding the August 24, 2009 overruling of its exception of lis pendens. Writs were denied by this court and subsequently by the supreme court.

Gregory Logan and William Logan filed exceptions of lis pendens in Calcasieu Parish related to the May 7, 2009, derivative suit filed by Travcal. A hearing on that exception was held on September 4, 2009, and on September 25, 2009, the Calcasieu Parish court sustained the exception. It is from this ruling that Travcal now appeals.

APPELLANT'S ASSIGNMENT OF ERROR:

The trial court abused its discretion in granting [Appellees'], Hit or Miss, L.L.C.'s, and William Logan, Jr.'s exceptions raising the objection of lis pendens.

LAW AND DISCUSSION ON THE MERITS:

At issue before this court is whether the Calcasieu Parish trial court was correct **4 in sustaining an exception of lis pendens in favor of Appellees, Gregory Logan and William Logan.

The basis for the exception of lis pendens lies in La.Code Civ.P. art. 531. It reads as follows:

When two or more suits are pending in a Louisiana court or courts of the same transaction or occurrence, between the same parties in the same capacities, the defendant may have all but the first suit dismissed by excepting thereto as provided in Article 925. When the defendant does not so except, the plaintiff may continue the prosecution of any of the suits, but the first final judgment rendered shall be conclusive of all.

The article lays out three requirements that must be satisfied in order for a lis pendens exception to be properly sustained. First, there must be two or more suits pending. Second, the suits must involve the same transaction or occurrence. Third, the suits must involve the same parties in the same capacities.

In Coury Moss, Inc. v. Coury, 07-1578, p. 4 (La.App. 3 Cir. 4/30/08), 981 So.2d 936, 939-40, writ denied, 08-1174 (La.9/19/08), 992 So.2d 944, this court stated that, "[t]he test for ruling on an exception of lis pendens is to inquire whether a final judgment in the first suit would be res judicata in the subsequently filed suit. Domingue v. ABC Corp., 96-1224, p. 3 (La.App. 4 Cir. 6/26/96), 682 So.2d 246, 248."

Looking to the three requirements laid out by La.Code. Civ.P. art. 531, there is no dispute between the parties that two suits are pending in Louisiana courts and that the Lafayette Parish suit was instituted prior to the Calcasieu Parish suit, nor is there a dispute that Gregory Logan's amended petition relates back to the filing of the original petition. There is also no dispute that the same parties exist in thesame capacities in both suits. Thus, the issue comes to rest on whether the two proceedings involve the same transaction or occurrence.

**5 Before we begin our discussion on the transactions or occurrences at the root of the suits at issue, we will address Travcal's argument in brief that the Calcasieu Parish court's sustaining of the lis pendens exception was improper because the initial suit filed was a declaratory judgment. Travcal asserts that because the Lafayette Parish proceeding was a declaratory judgment, as a matter of law, it cannot be res judicata as to the instant suit. We find no merit in this argument and direct attention to this court's decision in Spallino v. Monarch Sign Co., 00-447 (La.App. 3 Cir. 10/11/00), 771 So.2d 784, wherein we found that an eviction suit was barred by an exception of lis pendens because of the existence of a suit seeking declaratory judgment on the ownership of the property.

We now turn our attention to the remaining unresolved prong of La.Code Civ.P. art. 531—whether the two suits arise out of the same transaction or occurrence. There is no one test to determine what constitutes the same "transaction or occurrence." The idea that the expression carries a broad meaning was addressed by this court in Hy-Octane Investments, Ltd. v. G & B Oil Products, Inc., 97-28 (La.App. 3 Cir. 10/29/97), 702 So.2d 1057.

The term "transaction or occurrence" is used in seven articles of the Code of Civil Procedure.

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