Brown v. Adolph

691 So. 2d 1321, 1997 WL 155014
CourtLouisiana Court of Appeal
DecidedMarch 27, 1997
Docket96 CA 1257
StatusPublished
Cited by15 cases

This text of 691 So. 2d 1321 (Brown v. Adolph) 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
Brown v. Adolph, 691 So. 2d 1321, 1997 WL 155014 (La. Ct. App. 1997).

Opinion

691 So.2d 1321 (1997)

James H. "Jim" BROWN, as Commissioner of Insurance for the State of Louisiana, in his capacity as liquidator of Car Insurance Company in Receivership (f/k/a Automotive Casualty Insurance Company)
v.
A.J. ADOLPH, Frank Adolph and Mark Adolph.

No. 96 CA 1257.

Court of Appeal of Louisiana, First Circuit.

March 27, 1997.

*1322 Richard A. Curry, Rodolfo J. Aguilar, Jr., and S. Jess Sperry, Baton Rouge, for Plaintiff-Appellant James H. "Jim" Brown, Commissioner of Insurance for the State of Louisiana.

Bernard Marcus and William E. Wright, Jr., New Orleans, for Defendants-Appellants A.J. Adolph and Frank Adolph.

Before WATKINS, GONZALES and KUHN, JJ.

WATKINS, Judge.

This is an appeal by defendant, A.J. Adolph,[1] from a partial summary judgment in favor of the plaintiff James Brown, Commissioner of Insurance for the State of Louisiana, *1323 appearing in his capacity as liquidator of Car Insurance Company in Liquidation (f/k/a Automotive Casualty Insurance Company) (Commissioner).

BACKGROUND FACTS

On August 24, 1992, the Commissioner filed a petition for conservation against Automotive Casualty Insurance Company (ACIC or Old ACIC). On September 1, 1992, the parties entered into a consent order of rehabilitation, by which ACIC and its managing general agent, Adolph Enterprises, Inc., d/b/a Automotive Protection Services (APS), were placed into rehabilitation. The rehabilitation was later converted to a liquidation by ex parte order dated January 20, 1993.

On February 3, 1993, the Commissioner instituted a new proceeding directed at Automotive Financial Services, Inc. (AFS) and its sole shareholder, A.J. Adolph. In that proceeding, the Commissioner alleged that AFS, a finance company which had been operated by A.J. Adolph for more than 15 years before ACIC was formed, was a "single business enterprise" with ACIC and APS. After a seven day trial, judgment was rendered on June 4, 1993, declaring AFS, ACIC and APS to be a "single business enterprise" and ordering the liquidation of AFS as part of ACIC. The judgment was affirmed by this court in Brown v. Automotive Cas. Inc. Co., 93-2169 (La.App. 1st Cir. 10/7/94); 644 So.2d 723, writ denied, 94-2748 (La.1/6/95); 648 So.2d 932. During the pendency of the proceeding against AFS and A.J. Adolph, the Commissioner initiated the instant suit seeking recovery of damages from the former directors of ACIC, APS, and AFS. The plaintiff thereafter filed a "First Amended and Restated Petition," naming additional defendants.[2] On January 14, 1994, the Commissioner filed a second motion and order for partial summary judgment, specifically seeking outstanding amounts on loans made to A.J. Adolph and Frank Adolph. The following pertinent undisputed facts were set forth in the plaintiff's memorandum in support of summary judgment:

2. On May 22, 1991, A.J. Adolph received a loan from AFS in the amount of $600,000.00. Of this amount, $21,000.00 was repaid to AFS, and $230,000.00 was later treated as a bonus to A.J. Adolph, leaving as [sic] unpaid balance on the loan of $349,000.00. Interest accrued on this balance in the amount of $10,731.75 as of September 30, 1991, all as evidenced by Check Number 3219, dated May 22, 1991, payable to A.J. Adolph, adjusting journal entries dated September 30, 1991, the Balance Sheet of AFS dated July 31, 1992, and the Affidavit of Special Deputy Liquidator, R. Peter Girouard, Jr. (the "Liquidator's Affidavit"). (Copies of Check Number 3219 is attached as Exhibit E, adjusting journal entries are attached as Exhibit F, Balance Sheet of AFS is attached as Exhibit G, and the Liquidator's Affidavit is attached as Exhibit H.)
3. A. J. Adolph and Frank Adolph received loans from AFS, which balances were $55,418.29 and $19,906.16 respectively before they were written off by AFS on November 30, 1992, as a cash expense as evidenced by the cash receipts records dated November 30, 1992, and the Liquidator's Affidavit. (The cash receipts records are attached as Exhibit I.)
4. A. J. Adolph, Frank Adolph, and Mark Adolph have refused to return any sums advanced by AFS, despite amicable demand.
5. By order dated October 1, 1992, A.J. Adolph is to receive a one-time credit in the amount of Three Hundred Thousand and No/100 ($300,000.00) Dollars against any judgment that is issued against A.J. Adolph. A copy of the order is attached as Exhibit J.

Plaintiff's motion for partial summary judgment was heard on June 29, 1994, and judgment was granted in favor of plaintiff against A.J. Adolph for $415,150.04,[3] and *1324 against Frank Adolph for $19,906.16. The defendants filed a motion for new trial, and in support thereof submitted the affidavit of Mr. A.J. Adolph describing the circumstances giving rise to the amount for which the Commissioner sought recovery. The Commissioner filed a motion to strike the affidavit of Mr. Adolph. After hearing, the court denied the motion for new trial, and granted the motion to strike.

Defendants appealed, alleging the following assignments of error:

1. The trial court erred in granting relief beyond that which was sought in the Commissioner's lawsuit against the Adolphs.
2. The trial court erred in granting a partial summary judgment on one of many theories of law.
3. The trial court erred in considering the Affidavit of R. Peter Girouard who had no personal knowledge of the facts set forth in his Affidavit.
4. The trial court erred in awarding judgment against A.J. Adolph and Frank Adolph on loans which were written off by the corporation.
5. The trial court erred in refusing to consider the Affidavit of A.J. Adolph in which he denied that the amounts received by him from AFS were to be treated as "loans."

SUMMARY JUDGMENT

Appellate courts review summary judgments de novo under the same criteria that govern the trial court's consideration of whether summary judgment is appropriate. Schroeder v. Board of Supervisors of Louisiana State University, 591 So.2d 342, 345 (La.1991). Louisiana Code of Civil Procedure Article 966(B) provides that a motion for summary judgment "shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to material fact, and that mover is entitled to judgment as a matter of law."

Prior to 1996 La. Acts, First Extraordinary Session, No. 9, which amended LSA-C.C.P. art. 966, summary judgments were not favored, and all doubt concerning a dispute as to a material issue of fact was resolved against granting the motion for summary judgment and in favor of a trial on the merits. See Robertson v. Our Lady of the Lake Regional Medical Center, 574 So.2d 381, 385 (La.App. 1st Cir.1990), writ denied, 573 So.2d 1136 (La.1991). However, LSA-C.C.P. art. 966 A(2), as amended, now provides in part, "The summary judgment procedure is designed to secure the just, speedy, and inexpensive determination of every action, except those disallowed by Article 969. The procedure is favored and shall be construed to accomplish these ends." As this legislation is procedural in nature, it must be applied retroactively, as well as prospectively. NAB Natural Resources, L.L.C. v. Willamette Industries, Inc., 28,555, p. 3 (La. App.2d Cir. 8/21/96); 679 So.2d 477, 479; Short v. Giffin, 96-0361, pp.

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Bluebook (online)
691 So. 2d 1321, 1997 WL 155014, Counsel Stack Legal Research, https://law.counselstack.com/opinion/brown-v-adolph-lactapp-1997.