Duckworth Properties, L.L.C. v. Williams

52 So. 3d 287, 2010 La.App. 4 Cir. 0244, 2010 La. App. LEXIS 1613, 2010 WL 4813578
CourtLouisiana Court of Appeal
DecidedNovember 24, 2010
Docket2010-CA-0244
StatusPublished
Cited by5 cases

This text of 52 So. 3d 287 (Duckworth Properties, L.L.C. v. Williams) 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
Duckworth Properties, L.L.C. v. Williams, 52 So. 3d 287, 2010 La.App. 4 Cir. 0244, 2010 La. App. LEXIS 1613, 2010 WL 4813578 (La. Ct. App. 2010).

Opinion

TERRI F. LOVE, Judge.

|TDuckworth Properties, L.L.C. appeals the annulment of a default judgment against Clarence Williams and Irma Williams. The trial court granted the petition of Mr. and Mrs. Williams to annul the default judgment entered in favor of Duck-worth due to the improper practices of counsel for Duckworth. Because the record reflects that the trial court’s decision was reasonable, we affirm.

FACTUAL AND PROCEDURAL HISTORY

On April 1, 2008, Irma Williams filed suit in the Civil District Court for Orleans Parish against Duckworth Properties, L.L.C. (“Duckworth”) for breach of contract. Mrs. Williams alleged in her petition that Duckworth failed to properly restore her home pursuant to their contract of July 6, 2006. Mrs. Williams further *289 sought removal of a lien Duckworth had placed on her property for a sum it alleged she had failed to pay as per their contract.

Subsequently, on June 20, 2008, Duck-worth filed a suit against Mrs. Williams and her husband, Clarence Williams, in First City Court for breach of contract. Duckworth alleged in its petition that Mr. and Mrs. Williams (collectively referred to as “the Williamses”) failed to pay certain sums pursuant to the contract. Duck-worth’s suit against the Williamses arose out of the same 12transaction as that of the suit pending in Civil District Court against Duckworth.

On July 16, 2008, Duckworth obtained a default judgment against the Williamses. On April 7, 2009, the Williamses filed a petition to annul the default judgment pursuant to La C.C.P. art.2004, which was granted by the trial court at a hearing conducted on November 19, 2009. Duck-worth appeals the annulment, claiming that the trial court erred in granting same.

STANDARD OF REVIEW

“Trial courts are permitted discretion in deciding when a judgment should be annulled because of fraud or ill practices, to which discretion reviewing courts will defer.” Wright v. Louisiana Power & Light, 06-1181, p. 12 (La.3/9/07), 951 So.2d 1058, 1067. Our courts have examined each case from an equitable viewpoint to “ascertain whether allowing the judgment to stand would be inequitable or unconscionable” considering the practice by which the party was able to obtain the judgment. Alonso v. Bowers, 222 La. 1093, 64 So.2d 443, 444 (1953).

ANNULMENT

A final judgment obtained by fraud or ill practices may be annulled. La. C.C.P. art 2004(A). To determine whether a judgment has been obtained by actionable fraud or ill practices, it must be shown that: “(1) the circumstances under which the judgment was rendered showed the deprivation of legal rights of the litigant seeking relief, and (2) the enforcement of the judgment would have been unconscionable and inequitable.” Johnson v. Jones-Journet, 320 So.2d 533, 537 (La.1975). “[T]he article is not limited to cases of actual fraud or intentional wrongdoing”; however, it “is sufficiently broad to encompass” situations where:

a judgment is rendered through some improper practice or procedure which operates, even innocently, to deprive the party cast in judgment of some legal right, and where |3the enforcement of the judgment would be unconscionable and inequitable.

Kem Search, Inc. v. Sheffield, 434 So.2d 1067, 1070 (La.1983).

Duckworth avers that no fraud or ill practices were employed in acquiring the default judgment against the Williamses, and that the trial court therefore had no basis upon which to annul the default judgment. In their petition to annul the default judgment, the Williamses alleged that Duckworth’s counsel engaged in ill practices by filing suit in First City Court and obtaining a default judgment against them while their suit was pending against Duck-worth in Civil District Court. In its oral reasons for judgment, the trial court found that the actions of Duckworth’s counsel amounted to ill practices.

Duckworth argues that, because the Williamses were properly served with its petition for breach of contract, entry of default judgment following the legal delays was proper. To support this position, Duckworth cites various cases where the defendant’s failure to act was the decisive factor in upholding default judgments.

*290 Duckworth’s reliance on such cases is misplaced, however, because the case sub judice differs factually from those cited by Duckworth where the defendant pursues an action for nullity as a substitute for an appeal from a default judgment or as the solution to legal rights lost though one party’s negligence. Here, the Williamses do not dispute that they were served nor that they were obligated to respond. Rather, the Williamses sought annulment of the default judgment because of the alleged ill practices of Duckworth’s counsel.

Ill Practices

As referenced above, La. C.C.P. art.2004

|4is not limited to cases of actual fraud or wrongdoing, but is sufficiently broad enough to encompass all situations wherein a judgment is rendered through some improper practice or procedure which operates, even innocently, to deprive the party cast in judgment of some legal right, and where the enforcement of the judgment would be unconscionable and inequitable.

Russell v. Illinois Cent. Gulf R.R., 96-2649 (La.1/10/97), 686 So.2d 817, 819, quoting Kem Search, 434 So.2d at 1070. The Louisiana Supreme Court has found it to be an ill practice when an attorney obtains a default judgment without attempting to notify the opposing attorney when the opposing attorney participated in the litigation proceedings and the defendants were actively attempting to defend their rights. Kem Search, 434 So.2d at 1070; Russell, 96-2649, 686 So.2d at 819.

Here, Duckworth took a default judgment against the Williamses in First City Court without notice to their attorney while their suit against Duckworth was pending in Civil District Court regarding the same contractual dispute. Although the Williamses had not participated in the First City Court litigation at the time the default judgment was entered there, their suit in Civil District Court itself demonstrated that they were actively attempting to defend their rights in the contract dispute.

In Power Mktg. Direct, Inc. v. Foster, 05-2023, p. 1 (La.9/6/06), 938 So.2d 662, 664, the Louisiana Supreme Court found that

[a] party’s failure to give notice to an opposing party of his intent to take a default judgment against the opposing party, who is actively participating in litigation pending in a foreign jurisdiction between the same parties arising out of the same factual basis and contesting identical questions of law, constitutes fraud or ill practice under La. C.C.P. art.2004. (Emphasis added).

There, a breach of contract action was filed by Power Marketing against Foster in the state of Ohio pursuant to a choice of law clause contained in the parties’ | r,contract. Foster, 05-2023, p. 2, 938 So.2d 662, 664.

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52 So. 3d 287, 2010 La.App. 4 Cir. 0244, 2010 La. App. LEXIS 1613, 2010 WL 4813578, Counsel Stack Legal Research, https://law.counselstack.com/opinion/duckworth-properties-llc-v-williams-lactapp-2010.