Billy Spain v. H&H Investors, L.L.C.

• Court: Louisiana Court of Appeal
• Decided: September 26, 2023
• Docket: 2023-C-0491
• Status: Published

Opinion

BILLY SPAIN * NO. 2023-C-0491

VERSUS * COURT OF APPEAL H&H INVESTORS, L.L.C., ET * AL. FOURTH CIRCUIT * STATE OF LOUISIANA *******

ON SUPERVISORY WRIT FROM THE CIVIL DISTRICT COURT, ORLEANS PARISH NO. 2022-10771, DIVISION “E” Honorable Omar Mason, Judge ****** Judge Paula A. Brown ****** (Court composed of Judge Roland L. Belsome, Judge Joy Cossich Lobrano, Judge Paula A. Brown, Judge Tiffany Gautier Chase, Judge Nakisha Ervin-Knott)

LOBRANO, J., DISSENTS AND ASSIGNS REASONS CHASE, J., DISSENTS

James M. Garner Joshua S. Force Grant G. Butler SHER GARNER CAHILL RICHTER KLEIN & HILBERT, L.L.C. 909 Poydras Street, 28th Floor New Orleans, Louisiana 70112

COUNSEL FOR DEFENDANT/RELATOR

Hannah D. Adams Julia K. Jack David H. Williams SOUTHEAST LOUISIANA LEGAL SERVICES 1340 Poydras St. Suite 600 New Orleans, LA 70112

COUNSEL FOR PLAINTIFF/RESPONDENT WRIT GRANTED; REVERSED SEPTEMBER 26, 2023 PAB RLB NEK

Relator, Archon Information Systems, L.L.C., seeks review of the district

court’s June 29, 2023 judgment, which overruled its exception of no cause of

action and exception of prescription. For the reasons that follow, we grant

Relator’s writ application, reverse the district court’s judgment overruling its

exception of no cause of action, sustain its exception of no cause of action, and

dismiss Respondent’s, Billy Spain, claim of absolute nullity.

FACTS AND PROCEDURAL HISTORY

Respondent became delinquent on the property taxes due for the property

located at 6310 Stratford Place, New Orleans, Louisiana 70131 (“the property”).

On July 12, 2011, September 19, 2011, July 23 2012, and September 11, 2012, the

City of New Orleans (“the City”) through its contractor, Relator, sent notices by

certified mail to Respondent notifying him that his taxes were delinquent and his

property was scheduled for tax sale. The green cards from all four certified

mailings were returned “unclaimed/unable to forward.” Allegedly, these notices

were also sent to Respondent by first-class mail, but he did not receive the notices.

1 On September 25, 2012, the property went to tax sale. Because there was no

buyer at the tax sale, the property was adjudicated to the City. A tax sale certificate

was recorded on July 1, 2016. Respondent did not redeem the property.

On July 1, 2022, the City sent notice to Respondent that his interest in the

property would be terminated if he did not redeem the property by making all

required payments to the tax collector or file a lawsuit within sixty days.

Respondent admits that he received this notice.

Despite receiving the July 1, 2022 pre-deprivation notice, Respondent did

not redeem the property or file a lawsuit within the sixty-day time period. On

September 19, 2022, the City sold the property to H&H Investors, L.L.C. On

November 22, 2022, after the sixty-day time period had expired, Respondent filed

a lawsuit seeking to annul the tax adjudication and subsequent property sale.

Thereafter, on February 9, 2023, Relator filed exceptions of no cause of action and

prescription. Respondent filed an opposition memorandum on June 7, 2023. The

matter came for hearing on June 16, 2023, and the district court signed a written

judgment denying the exceptions on June 29, 2023.

In overruling Relator’s exception of no cause of action, the district court

held that the alleged defects or deficiencies in the pre-tax sale notice to Respondent

were sufficient to support a “cause of action under the law with respect to absolute

nullity with respect to the tax sale in this matter.” The court overruled the

exception of prescription on the basis that “there is no prescription with respect to

absolute nullities.” This timely writ application for supervisory review followed.

2 DISCUSSION

A district court’s ruling on a peremptory exception of no cause of action

presents a legal question and is thus reviewed under the de novo standard of

review. Phillips v. Gibbs, 10-0175, p. 3 (La. App. 4 Cir. 5/21/10), 39 So.3d 795,

797 (citing Tuban Petroleum, L.L.C. v. SIARC, Inc., 09-0302, p. 3 (La. App. 4 Cir.

4/15/09), 11 So.3d 519, 522). The pertinent question on an exception of no cause

of action is whether, when viewed in the light most favorable to the plaintiff and

with every doubt resolved in his behalf, the petition states any valid cause of action

for relief. Id. (citing Wright v. Louisiana Power & Light, 06-1181, p. 15 (La.

3/9/07), 951 So.2d 1058, 1069). This exception is designed to test the legal

sufficiency of a petition by determining whether a party is afforded a remedy in

law based on the facts alleged in the pleading. Phillips, 10-0175, p. 3, 39 So.3d at

797-98 (citing Foti v. Holliday, 09-0093, p. 5 (La. 10/30/09), 27 So.3d 813, 817).

All well-pleaded allegations of fact are accepted as true and correct, and all doubts

are resolved in favor of sufficiency of the petition so as to afford litigants their day

in court. Phillips, 10-0175, p. 3, 39 So.3d at 798. The burden of demonstrating that

a petition fails to state a cause of action is upon the mover. Id. (citing Ramey v.

DeCaire, 03–1299, p. 7 (La.3/19/04), 869 So.2d 114, 119).

This Court has held that a deficiency in pre-tax sale notice is insufficient for

purposes of nullifying a tax sale. Sunset Harbour v. Brown, 22-0572, p. 6 (La.

App. 4 Cir. 1/9/23), 356 So.3d 1167, 1171-72 (citing Cmty. Associates, Inc. v.

Taylor, 19-0242, p. 7 (La. App. 4 Cir. 7/31/19), 364 So.3d 1, 6); see also PCOF

3 Properties, L.L.C. v. Joseph, 21-0341, p. 6 (La. App. 4 Cir. 12/1/21), 332 So.3d

220, 224 n. 2 (where this Court observed that “only deficiencies in post-tax sale

notice provide a ground for seeking nullification of a tax sale”). Further, this Court

has recognized that “any deficiency in pre-sale notices can be cured by proper

post-sale notice.” Klein v. Henderson, 21-0317, p. 19 (La. App. 4 Cir. 11/17/21),

332 So.3d 764, 777 n. 13 (quoting Stow-Serge v. Side by Side Redevelopment, Inc.,

20-0015, p. 7 (La. App. 4 Cir. 6/10/20), 302 So.3d 71, 77 n. 9). This Court has also

recognized that “[u]nder the 2008 revisions [to the tax sale laws], ‘tax sales may no

longer be attacked as absolute nullities.’” Precept Credit Opportunities Fund, L.P.

v. Walker, 21-0670, p. 8 (La. App. 4 Cir. 6/22/22), 343 So.3d 299, 305 (quoting

Stow-Serge, 20-0015, p. 5, 302 So.3d at 76).

In the case sub judice, the record reflects that Respondent acknowledged

receipt of post-sale notice of the tax sale. As such, we find that the district court

erred in overruling the Relator’s exception of no cause of action on the basis that

the alleged defects in the pre-tax sale notices to Respondent were sufficient to

support a cause of action for the absolute nullity of the tax sale.

Having found that the Respondent failed to state a sufficient cause of action,

we must now determine if an amendment to the petition would have cured the

grounds for Relator’s exception of no cause of action. Pursuant to La. C.C.P. art.

934, “[w]hen the grounds of an objection pleaded by the peremptory exception [of

no cause of action] may be removed by amendment of the petition, the judgment

sustaining the exception shall order such amendment within the delay allowed by

4 the court. If the grounds raised through the exception cannot be so removed, the

action, claim, demand, issue, or theory shall be dismissed.” In light of the fact that

Respondent received post-sale notice, an amendment to the petition would not cure

the grounds for the exception of no cause of action; thus, dismissal is the

appropriate remedy.

CONCLUSION

For the reasons stated above, we grant Relator’s writ application, reverse the

district court’s judgment overruling Relator’s exception of no cause of action,

sustain Relator’s exception of no cause of action, and dismiss Respondent’s claim

of absolute nullity1.

WRIT GRANTED; REVERSED

1 Because this Court concludes Respondent has no cause of action for absolute nullity, it is not

necessary for this Court to address the peremptory exception raising the objection of prescription.