Asi Management, LLC v. Advantage Ford, Inc.

999 So. 2d 66, 2008 La.App. 4 Cir. 0255, 2008 La. App. LEXIS 1520, 2008 WL 4952774
CourtLouisiana Court of Appeal
DecidedNovember 19, 2008
Docket2008-CA-0255
StatusPublished

This text of 999 So. 2d 66 (Asi Management, LLC v. Advantage Ford, Inc.) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Asi Management, LLC v. Advantage Ford, Inc., 999 So. 2d 66, 2008 La.App. 4 Cir. 0255, 2008 La. App. LEXIS 1520, 2008 WL 4952774 (La. Ct. App. 2008).

Opinion

999 So.2d 66 (2008)

ASI MANAGEMENT, L.L.C.
v.
ADVANTAGE FORD, INC.

No. 2008-CA-0255.

Court of Appeal of Louisiana, Fourth Circuit.

November 19, 2008.

*67 Vallerie Oxner, Metairie, LA, for Plaintiff/Appellee, ASI Management, LLC.

William H. Eckert, Rhonda J. Thomas, Ungarino & Eckert L.L.C., Metairie, LA, for Defendant/Appellant, Advantage Ford, Inc.

(Court composed of Chief Judge JOAN BERNARD ARMSTRONG, Judge PATRICIA RIVET MURRAY, Judge ROLAND L. BELSOME).

ROLAND L. BELSOME, Judge.

Defendant-Appellant Advantage Ford, Inc. ("Ford") appeals the trial court's judgment awarding damages to Plaintiff-Appellee ASI Management, LLC ("ASI"). For the reasons that follow, we affirm.

FACTS AND PROCEDURAL HISTORY

On October 11, 2006, ASI brought a 2004 Ford F-150 truck that it owned to Advantage Ford for a "tune-up."[1] While the vehicle was being serviced by Ford, an employee of Ford broke three spark plugs, subsequently causing damage to the engine and disabling the vehicle's computer and security systems. Ford unsuccessfully attempted to fix the damage to the vehicle. ASI had the vehicle towed to three other repair shops in an effort to repair the engine, but none were able to start the vehicle or attempt repairs because the computer systems were disabled.[2]

On September 17, 2007, counsel for ASI issued correspondence directly to Advantage *68 Ford demanding compensation for the damages to the truck.[3] In response, counsel for ASI received a letter from counsel for Advantage Ford, John Cutrera, Jr., dated October 3, 2007, acknowledging the demand letter received by Advantage Ford. Counsel for Ford denied that ASI's vehicle was "running fine" when it was received by Ford; stated that spark plugs "routinely break off" when they are seized in the engine; admitted that three spark plugs had broken off while the vehicle was being repaired by Ford, but denied that Ford caused the plugs to seize in the engine, and asserted that Ford was therefore not liable to ASI for any damage.

Thereafter, on October 5, 2007, ASI filed suit in First City Court, requesting service upon Ford's registered agent. A review of the record evidences that Ford's registered agent in New Orleans was personally served on October 17, 2007. After a hearing, a default judgment in favor of ASI was signed on December 11, 2007 in the amount of $16,616.06, together with costs and legal interest from the date of demand. It is from this judgment that Ford appeals.

DISCUSSION

In its sole assignment of error, Ford argues that the trial court erroneously granted the default judgment because Ford had insufficient opportunity to answer or defend the claims due to ill practices by counsel for ASI. Ford submits that the ill practices by counsel for ASI consisted of: 1) the failure to notify counsel for Ford of the filing of the petition or the hearing on the default judgment, and 2) the taking of the default judgment itself.

Ford further argues that ASI's alleged ill practices in obtaining the default judgment are a basis for annulling the judgment pursuant to La.Code Civ. Proc. art.2004. As the party seeking the annulment of a judgment based upon ill practices, Ford bears the burden of demonstrating how Ford was excused or prevented from asserting its claims or defenses. CA One/Pampy's v. Brown, et al, 07-1377, p. 6 (La.App. 4 Cir. 4/2/08), 982 So.2d 909, 913 (citing Green v. Neese, 99-3223, 99-3224, p. 3 (La.App. 4 Cir. 9/20/00), 769 So.2d 694, 696-7). The criteria for determining whether a judgment has been obtained by ill practices are: 1) whether the circumstances under which the judgment was rendered evidenced the deprivation of legal rights of the litigant seeking relief; and 2) whether the enforcement of the judgment would be inequitable and unconscionable. Brown, 07-1377, p. 6-7, 982 So.2d at 914 (citing Power Marketing Direct, Inc. v. Foster, 05-2023, p. 12 (La.9/6/06), 938 So.2d 662, 670). Additionally, a trial court has discretion in deciding whether a judgment should be annulled due to fraud or ill practices, to which discretion a reviewing court will defer. Foster, 05-2023, p. 10, 938 So.2d at 669.

In this case, Ford does not dispute that its registered agent was personally served with ASI's petition. Rather, Ford asserts that notice of the lawsuit and default judgment should also have been provided to Mr. Cutrera in addition to the registered agent. Accordingly, this Court must determine whether, by serving Ford's registered agent, ASI deprived Ford of some legal right, and whether enforcement of the judgment would be unconscionable or *69 inequitable. See Brown, supra; Neese, supra.

The Louisiana Code of Civil Procedure provides that service on a domestic or foreign corporation is made by personal service on any of its agents for service of process. La.Code Civ. Proc. art. 1261(A). Thus, counsel for ASI complied with the service requirements mandated by the Code of Civil Procedure. Ford maintains, however, that pursuant to Louisiana jurisprudence, even though service was proper, the default judgment should nonetheless be annulled because it was obtained by ill practices. In support, Ford relies in part on Kem Search, Inc. v. Sheffield, 434 So.2d 1067, 1070 (La.1983). In Kem Search, the defendant, David Sheffield, was served with a copy of the petition and subsequently spoke with counsel for Kem Search over the telephone regarding the suit. Kem Search, 434 So.2d at 1069. Following the telephone conversation, Sheffield issued correspondence to counsel for Kem Search, confirming the conversation wherein counsel for Kem Search agreed to allow Sheffield additional time to obtain counsel and file responsive pleadings. Id. Sheffield further stated in the letter that he wished to discuss the matter in person and potentially reach an amicable settlement. Id.

Shortly thereafter, counsel for Kem Search responded to Sheffield's letter, in which the Court noted a willingness to discuss settlement was indicated, in addition to the following remark: "If you wish to discuss this matter[,] feel free to give me a call." Id. Approximately a month later, without informing Sheffield, counsel for Kem Search entered a preliminary default,[4] and then ultimately confirmed the preliminary default, again without notifying Sheffield. Id. The Louisiana Supreme Court concluded that Sheffield was unfairly deprived of an opportunity to present his defenses and lost legal rights. Id. at 1071. The Court noted that although Sheffield could have acted more prudently to protect his rights by filing responsive pleadings, enforcement of the judgment would be unconscionable "because Sheffield failed to act due to his mistaken and not unreasonable impression that Kem Search's attorney would give him an opportunity to file pleadings if his settlement overtures were rejected." Id. The Court further stated that "[t]he communications between Sheffield and the Kem Search attorney provide a basis for a reasonable belief that Sheffield, an attorney, would be given such notice." Id. The facts in the instant case are plainly distinguishable from the circumstances in Kem Search, in which numerous communications were made and the potential for settlement was discussed. We therefore find Ford's reliance on Kem Search to be misplaced.

Ford also cites Russell v. Illinois Central Gulf Railroad, 96-2649 (La.1/10/97), 686 So.2d 817, in support of its argument. In Russell,

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Russell v. Illinois Cent. Gulf R. Co.
686 So. 2d 817 (Supreme Court of Louisiana, 1997)
Kem Search, Inc. v. Sheffield
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Johnson v. Welsh
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Bluebook (online)
999 So. 2d 66, 2008 La.App. 4 Cir. 0255, 2008 La. App. LEXIS 1520, 2008 WL 4952774, Counsel Stack Legal Research, https://law.counselstack.com/opinion/asi-management-llc-v-advantage-ford-inc-lactapp-2008.