Barry Doleac v. Real Estate Professionals, LLC

CourtMississippi Supreme Court
DecidedMarch 22, 2004
Docket2004-CA-00902-SCT
StatusPublished

This text of Barry Doleac v. Real Estate Professionals, LLC (Barry Doleac v. Real Estate Professionals, LLC) is published on Counsel Stack Legal Research, covering Mississippi Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Barry Doleac v. Real Estate Professionals, LLC, (Mich. 2004).

Opinion

IN THE SUPREME COURT OF MISSISSIPPI

NO. 2004-CA-00902-SCT

BARRY DOLEAC, THE DOLEAC COMPANY AND THE DOLEAC BUILDING, LLC

v.

REAL ESTATE PROFESSIONALS, LLC

ON MOTION FOR REHEARING

DATE OF JUDGMENT: 03/22/2004 TRIAL JUDGE: HON. SEBE DALE, JR. COURT FROM WHICH APPEALED: FORREST COUNTY CHANCERY COURT ATTORNEY FOR APPELLANT: RAY T. PRICE ATTORNEYS FOR APPELLEE: RICHARD ANTHONY FILCE ERIK M. LOWREY NATURE OF THE CASE: CIVIL - TORTS-OTHER THAN PERSONAL INJURY & PROPERTY DAMAGE DISPOSITION: REVERSED AND REMANDED - 09/15/2005 MOTION FOR REHEARING FILED: 06/21/2005 MANDATE ISSUED:

EN BANC.

SMITH, CHIEF JUSTICE, FOR THE COURT:

¶1. The motion for rehearing is denied. The prior opinion is withdrawn, and this opinion

is substituted therefor.

¶2. Real Estate Professionals, LLC (“REP”) sued Barry Doleac, The Doleac Company and

The Doleac Building, LLC for breach of their Independent Contractor Agreement, tortious

interference with business relations, breach of their Asset Purchase Agreement, trespass to

chattels, conversion, and for punitive damages. REP also asked for an accounting, declaratory

judgment and an injunction. Before trial, the Chancery Court of Forrest County granted a temporary restraining order, permitting REP to remain in possession of the leased premises.

Doleac’s motion to dismiss the complaint and compel arbitration was denied by the chancellor.

The chancellor found for REP, and Doleac now appeals to this Court. We hold that the

chancery court erred in denying the motion to compel arbitration. Therefore, we reverse and

remand with directions to submit all disputes to binding arbitration.

FACTS AND PROCEDURAL HISTORY

¶3. Barry Doleac is the principal shareholder in Doleac Company and Doleac Building,

LLC. The Doleac Company is owned 95% by Barry, president, who was also a licensed

Mississippi real estate broker, and 5% is owned by his wife Carolyn. REP is a limited liability

company organized and doing business as a real estate agency in Hattiesburg, Mississippi. The

case sub judice is a suit for various claimed torts arising from the performance of three

contracts which were signed to effectuate the sale of a real estate business.

¶4. The Doleac Company, Doleac Building and Barry Doleac executed three agreements

with REP on December 31, 1999. Those three agreements are as follows: (1) an Asset

Purchase Agreement (hereinafter “APA”) for REP to buy The Doleac Company; (2) a Lease

Agreement (hereinafter “LA”) by which REP was to rent office space from The Doleac

Building; and (3) an Independent Contractor Agreement (hereinafter “ICA”) for Barry Doleac

to work for REP for a period of five years.

¶5. The APA provided for the purchase by REP of certain business assets of The Doleac

Company at a purchase price of $500,000, payable $125,000 at closing with balance evidenced

by promissory note payable in monthly installments over a five-year period. The monthly

installments were contingent upon Barry, agents currently associated with Barry and any other

2 agents recruited by Barry producing a minimum of $1,100,000 gross commission income

yearly. The contract references a security agreement in REP’s “present and future listing

agreements and all personal property owned or acquired” that was to be attached to the APA

but that security agreement was never attached. In conjunction with this, a UCC-1 financing

statement was filed and reflects that it applied to REP’s “listing agreements and sales

contracts.”

¶6. The APA stated that Barry would enter into an employment contract with REP, the

terms of which were incorporated into and made part of the APA. This ICA provided that Barry

would work for REP for a term of five years beginning on January 1, 2000, and continuing

through December 31, 2004. The compensation to Barry was on a commission basis, outlined

with specificity in the agreement. This agreement states that it is “the entire agreement

between undersigned parties and can only be amended in writing and signed by both parties.”

The agreement does not make any provision for termination except by completion of the stated

term.

¶7. Also incorporated into and made apart of the APA was a lease of certain property. This

LA leased “suites 1, 4, 5, and part of suite 3" at a stated location to be used primarily for

offices. The rental on this certain property was $7,500 per month to be paid the first of each

month and a penalty of 4% to be added if payment is not received within ten days of the due

date. This agreement provided that if there is a default by Lessee, Lessor will provide written

notice and if such default is not cured within 10 days then “Lessor may re-take the same as if

this lease had not been made.”

3 ¶8. Almost immediately REP started becoming delinquent in making the payments under

the LA and the APA. The Doleac Company and Building called every month to inform REP

that payment was late. When the late payment was brought to the attention of REP, the sales

manager would send a check which included the payment plus the late fee. This sales manager

left REP and after that Doleac Company had problems getting payment. In July and August

2002, REP did not make the payments again and ignored the repeated inquiries about the late

payments. On behalf of Doleac Company and Doleac Building, Barry, took the three

agreements to his attorney in order to determine a course of action. Barry Doleac, on advice

of the attorney, changed the locks on the building which REP rented, as authorized and agreed

to in the LA. Barry said that he changed the locks on the building on Labor Day when the office

was closed so that business was minimally disrupted and in order to quickly work something

out regarding the late payments. There was also a security guard stationed at the door in order

to regulate access to the building.

¶9. The agents working for REP were eventually allowed into the building, and some of the

agents were accompanied by the security guard. Four agents testified that the lock-out

concerned them because they did not know exactly what was happening. One agent testified

that the lock-out affected REP because rumors started spreading to other companies and their

agents. Furthermore, one agent lost two listings because of the rumors regarding the lock-out.

¶10. The next day, the owners of REP, Barry Doleac, and Doleac’s attorneys met. At the

meeting Doleac told REP the amount of money due under the LA and APA which was required

to be paid in order for the building to be unlocked. Doleac’s position was that the lease was

null and void since REP was three months late. Furthermore, since REP was late on payments

4 under the APA and since this agreement included an acceleration clause, Doelac considered

the entire amount on the note due. The parties agreed that REP would pay the back due rent on

the lease and that the parties would renegotiate a new lease for one suite. Furthermore, the

parties agreed that REP would pay $50,000 under the APA instead of the full amount that was

owed. The total amount that REP was required to pay in order to get the building unlocked was

$80,600, which included the $50,000 on the APA, the back due rent and the current rent,

attorney’s fees and the cost of changing the locks. REP borrowed the money and paid Doleac

what was owed. The next day a new key was given to REP, and it was given access to the

building.

¶11.

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