Belle Pass Terminal, Inc. v. Jolin, Inc.

774 So. 2d 1251, 99 La.App. 1 Cir. 2988, 2000 La. App. LEXIS 3573, 2000 WL 1871734
CourtLouisiana Court of Appeal
DecidedDecember 22, 2000
DocketNos. 99 CA 2988, 99 CA 2989
StatusPublished
Cited by1 cases

This text of 774 So. 2d 1251 (Belle Pass Terminal, Inc. v. Jolin, 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
Belle Pass Terminal, Inc. v. Jolin, Inc., 774 So. 2d 1251, 99 La.App. 1 Cir. 2988, 2000 La. App. LEXIS 3573, 2000 WL 1871734 (La. Ct. App. 2000).

Opinion

| .CARTER, C.J.

Richard P. Guidry appeals the denial of his petition seeking to annul a prior judgment finding appellant, along with Elmo Pitre, Jr., and Belle Pass Terminal, Inc. (Belle Pass) liable on a $2 million promissory note.

BACKGROUND

This litigation arises out of a business deal gone sour between Guidry, Pitre, Belle Pass, Joseph E. Blanchard, Jr., Jolin, Inc. (Jolin), and Harold Calíais. The facts detailing the original dispute and resolution can be found in our prior decision in this matter, Belle Pass Terminal, Inc. v. Jolin, Inc., 92-1544 (La.App. 1st Cir.3/11/94), 634 So.2d 466, writ denied, 94-0906 (La.6/17/94), 638 So.2d 1094.

To briefly summarize the background, the Belle Pass litigation arose from the sale of a marine terminal and docking facility at Pass Fourehon in Lafourche, Louisiana. Blanehard!s company, John, owned the facility and leased the land used for the facility from Caillouet Land Company (CLC). By the express terms of the leases, Blanchard/Jolin could not sell, assign, or transfer the leases without CLC’s consent.

In early 1989, Blanchard informed Pitre of his desire to sell his business on the docks. Following several attempts to secure potential buyers and the necessary financing, Pitre, Calíais, and Guidry formed a corporation, Belle Pass, which would purchase the dock and other fixed assets from Jolin in exchange for a mortgage and promissory note for $2 million with an interest rate of 13%, payable in 120 monthly installments. This transaction was executed on April 6, 1989. Gui-dry, as president of Belle Pass, signed the note and Guidry and Pitre personally guaranteed the note. Calíais purchased certain movable property from Jolin for $1 million; however, Calíais did not guarantee the $2 million note. CLC was not informed of the transaction between the parties.

[1253]*1253After the sale, the Belle Pass business struggled and the relationships between the parties became strained. Pitre, who was working as the manager of the dock, was terminated by Guidry and Calíais following his indictment on felony counts in federal court. Pitre filed a lawsuit against Guidry and Calíais over his termination. Blanchard also became upset with Guidry and Calíais over Pitre’s dismissal from Belle Pass. It 14was only after the relationships between the parties began to deteriorate, that Calíais and Guidry revealed to CLC that there had been a transfer of the business located at the terminal.

Following the termination of Pitre, the parties encountered difficulties involving the required insurance coverage and timeliness of the scheduled payments to Blanchard. John filed a lawsuit on the promissory note against Belle Pass, Gui-dry, Pitre, and Calíais. This suit was consolidated with another lawsuit filed by Belle Pass and Calíais against Blanchard and Jolin alleging breach of warranty, red-hibition, and damages from the sale of the movable property and the purported sale and mortgage of the leases John had from CLC.

The matter was tried before a jury in early 1992. The critical issue presented to the jury concerned whether John’s lease of the CLC land had been sold to Belle Pass. The jury determined that John and Blanchard had not sold their leases issued by CLC to Belle Pass, Guidry, and Pitre. As a result of this determination, judgment was rendered in the action on the promissory note in favor of John and Blanchard and against Belle Pass, Guidry, and Pitre for $2 million, interest of 13% per annum from April 6, 1989, with a credit for previously paid installments, and attorney’s fees of $125,000.00. This portion of the judgment was affirmed on appeal by this court in Belle Pass, 634 So.2d at 488.

FACTS

As a result of the verdict and judgment, Belle Pass declared bankruptcy. In the bankruptcy proceeding, Blanchard foreclosed on his mortgage and succeeded in reclaiming the terminal facility. Blanchard began executing his judgment against Guidry, but made no effort to execute against Pitre until May 7, 1995. By that time Blanchard was unable to execute the judgment against Pitre because Pitre had also declared bankruptcy.

The proliferation of litigation spawned by the 1989 Belle Pass transaction continued on September 18, 1995, when Rodney J. Martin filed a suit for breach of contract against Blanchard, Blanchard’s wife, Linda, and Elmo Pitre, III d/b/a R & J Trucking Company. Martin alleged the defendants were jointly and solidarily liable to | Rhim for the principal sum of $34,096.88, and also sought to recover lost profits and damages allegedly resulting from the defendant’s alleged breach of contract. Martin’s case was consolidated with a suit on a promissory note filed by Blanchard against Elmo Pitre, III (Pitre, III).

The testimony in Martin’s case revealed that in early 1991, Pitre (the father of Pitre, III) approached Rodney Martin with a scheme he claimed would be very profitable for himself and Martin. Pitre explained that Blanchard was engaged in litigation arising from the sale of the terminal facility at Port Fourchon to Belle Pass and that Blanchard needed help in paying his legal fees.

According to Martin, Blanchard and Pi-tre were seeking to obtain a judgment against Calíais for the $2 million note. Martin’s role was to provide funds to Blanchard on his legal expenses and in exchange he would be considered an equal partner when Blanchard and Pitre returned to business in Fourchon 'at the old Jolin facility. Martin subsequently took out loans on his home in order to funnel money to Blanchard for his legal fees. According to Martin, his arrangements with Blanchard and Pitre were to be kept secret from Calíais and Guidry. Martin was never repaid for his loans that provid[1254]*1254ed Blanchard with funds to pay his legal expenses and his lawsuit ensued.2

When Guidry became aware of the alliance between Blanchard and Pitre, he filed a suit on November 15, 1995, pursuant to LSA-C.C.P. art. 2004 seeking to annul the prior judgment in the Belle Pass litigation that was originally rendered on March 2, 1992. Guidry contended that he knew nothing of the pact between Blanchard and Pitre until Martin’s suit was filed in September, 1995. Guidry argues that had the jury in the 1992 Belle Pass trial known of the relationship that existed between Blanchard and Pitre, and if it had known that Pitre was directing Martin to provide funds to Blanchard for his legal expenses, the jury would have rejected the Blanchard/Pitre version of the 1989 transaction.

|fiAfter a trial on this matter, the trial court denied Guidry’s petition seeking annulment of the judgment, making him liable on the $2 million note. Guidry appeals the judgment of the trial court, and specifies the following as his assignments of error:

1. The trial court erred in concluding that Pitre and Blanchard did not commit fraud or ill practices within the meaning of LSA-C.C.P. 2004 in the Belle Pass litigation.
2. The trial court applied an improper standard in reaching its decision that the Belle Pass judgment should be annulled, namely that evidence of collusion and concealment of collusion by Pitre and Blanchard would not have made a difference in the outcome of the Belle Pass litigation.

DISCUSSION

The trial court is accorded great discretion in deciding when a judgment should be set aside for fraud or ill practices. Kem Search, Inc. v. Sheffield, 434 So.2d 1067, 1071 (La.1983),

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Related

Belle Pass Terminal, Inc. v. Jolin, Inc.
800 So. 2d 762 (Supreme Court of Louisiana, 2001)

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Bluebook (online)
774 So. 2d 1251, 99 La.App. 1 Cir. 2988, 2000 La. App. LEXIS 3573, 2000 WL 1871734, Counsel Stack Legal Research, https://law.counselstack.com/opinion/belle-pass-terminal-inc-v-jolin-inc-lactapp-2000.