King v. Pontchartrain Mortgage Co.

134 So. 3d 19, 13 La.App. 5 Cir. 633, 2014 WL 346617, 2014 La. App. LEXIS 203
CourtLouisiana Court of Appeal
DecidedJanuary 31, 2014
DocketNo. 13-CA-633
StatusPublished
Cited by7 cases

This text of 134 So. 3d 19 (King v. Pontchartrain Mortgage Co.) 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
King v. Pontchartrain Mortgage Co., 134 So. 3d 19, 13 La.App. 5 Cir. 633, 2014 WL 346617, 2014 La. App. LEXIS 203 (La. Ct. App. 2014).

Opinion

SUSAN M. CHEHARDY, Chief Judge.

| {¡On appeal before us is a summary judgment that was granted, dismissing the plaintiffs’ legal malpractice suit against one defendant. We affirm.

STATEMENT OF THE CASE In August 2001, Evangelist W. King1 and Jason King (collectively hereinafter “King”), sued Pontchartrain Mortgage Company, Inc. and Pontchartrain Mortgage Corporation (collectively hereafter “Pontchartrain”), Mortgage Equity, Inc. and Commercial Lenders and Equity, Inc. (collectively hereafter “Equity”), Terry P. Lafargue (“Lafargue”), and Bruce A. Miller (“Miller”). In the petition (as amended and supplemented in November 2001 and September 2004), King alleged breach of contract against Pontchartrain and La-fargue arising from a Settlement Agreement and Release executed on October 21, 1998 (“the Agreement”), under which Pontchartrain, Equity and Lafargue agreed to pay $70,000 in return for Evangelist King’s relinquishing his claims to a 50% ownership interest in Pontchartrain and Equity.2 King alleged that Lafargue and Pontchartrain breached the Agreement by failing to make payments as set out in the Agreement. King further alleged that Lafargue knew at the time of the Agreement that the value of |sthe stock/corporations exceeded that communicated to King, and that King would not have entered into the agreement if they had been informed of the true state and/or value of the corporations.3

King alleged Miller committed legal malpractice because he simultaneously represented both King and La-fargue/Pontchartrain in preparing the Agreement, yet Miller failed to disclose the dual representation. King further alleged that Miller erroneously counseled Evangelist King that it was in his best interest to enter the Agreement, when Miller knew that the value of the stock/corporations exceeded that communicated to King by the defendants.

On October 4, 2012, defendant Miller filed a motion for summary judgment. Miller asserted that King would be unable to prove his claim of legal malpractice against Miller because King could not prove any damages caused by Miller’s alleged conduct. Specifically, Miller asserted that King had no evidence that the amount paid to King under the Agreement was not a fair valuation of King’s claimed interest in Pontchartrain at the time the Agreement was signed.

In support of the motion for summary judgment, Miller attached an affidavit by Timothy Murphy, the former certified public accountant for Pontchartrain. In this affidavit, Murphy avers that he is a certified public accountant and has been so licensed since 1982, and that he was the certified public accountant for Pontchartrain when it was in business. Murphy avers that he was aware in 1998 that King desired to leave his employment with Pontchartrain and demanded that he be paid what he believed was his one-half interest in the capital stock of Pontehar-[21]*21train or one-half of the value of the company. Murphy further avers that although he did not do a formal valuation of Pontchartrain, he was familiar with its |4fínancial status in 1998, and that he believes that the agreed payment of $70,000 to King as set forth in the Settlement Agreement and Release represented a fair, if not even generous, estimate of one-half of the value of Pontchartrain in October, 1998.

Miller also attached the affidavit of Terry P. Lafargue, in which Lafargue testified that he and King, alone, negotiated the settlement agreement at issue. Lafargue further testified that he and King agreed on the $70,000 settlement figure paid to King based upon the calculation of Pontchartrain’s assets as of September 30, 1997, less its liabilities. Lafargue further testified that he and King agreed that this amount would result in a one-half value of $60,949, but that King was not satisfied with being paid $61,000. Therefore, La-fargue said, he agreed to increase the payout to King to the sum of $70,000 in order to resolve this disagreement.

In opposition to the motion for summary judgment, King asserted that he was damaged because Miller failed to disclose his conflict of interest, in that he has not received all payments due him because of a clause in the Agreement that provided that Pontchartrain Mortgage Company, Inc. would not make payments to King if the corporation’s net income was less than $8,000.00 for a month; that he was “duped” by Mr. Miller and the corporation was under-valued; and that King cannot determine the full extent of his damages until he can take the deposition of Terry LaFargue, the preparer of the financial statements for Pontchartrain Mortgage Company, Inc. Thus, King contends the motion for summary judgment is premature because there remains outstanding discovery.

On January 22, 2013, three days before the date set for hearing of the motion for summary judgment, King filed a Supplemental Memorandum in Opposition to Motion for Summary Judgment. Attached to it was a report by Bert F. Verdigets, CPA, CFE, CFF, in the form of a letter to plaintiffs’ counsel stating that, based on his analysis, the range of the price for the company on October 21, 1998, would be | ¡^between $142,225 and $489,625 or at 50% $71,113 and $244,812 respectively, not including interest on those amounts, “which would significantly increase those numbers.” The letter was neither sworn nor accompanied by an affidavit verifying it.

At the hearing on the motion for summary judgment, counsel for Miller objected to admitting the Verdigets letter as an exhibit in support of King’s opposition. Defense counsel pointed out that the letter was inadmissible because it was unsworn and also because it was filed only three days before the hearing, in violation of La. C.C.P. art. 966 and La. Distr. Ct. Rule 9.9.

In ruling on the motion for summary judgment the judge stated, “I am going to grant the motion. Given the age of the case and the fact that the affidavit, I mean, the letter is not sworn, ... I’m going to find it’s not admissible.... There was certainly enough time for sworn evidence to be presented.”

The plaintiffs have appealed. On appeal they make the following assignments of error:

1. The totality of the record evidence established that Mr. King proved that he sustained damages as a result of Mr. Miller’s conflict of interest, and at a minimum, raised multiple issues of material fact that precluded the granting of summary judgment. The district court erred in granting Mr. Miller’s Motion for Summary Judgment.
[22]*222. Mr. Bert Verdigets’s expert report was timely filed and appropriate evidence to oppose a Motion for Summary Judgment pursuant to the Louisiana Supreme Court’s decision in Independent Fire Ins. Co. v. Sunbeam Corp., 99-2181 (La.02/29/00), 755 So.2d 226. The district court erred in excluding Mr. Verdigets’s expert report from evidence.

We find no merit in these assignments, for the following reasons.

[,LAW AND ANALYSIS

Appellate courts review summary judgments de novo, under the same criteria that govern the district court’s consideration of whether summary judgment is appropriate. Premier Restaurants, Inc. v. Kenner Plaza Shopping Ctr., L.L.C., 99-1310, p. 8 (La.App. 5 Cir. 8/29/00), 767 So.2d 927, 931-32, citing Schroeder v. Board of Supervisors, 591 So.2d 342, 345 (La.1991).

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Bluebook (online)
134 So. 3d 19, 13 La.App. 5 Cir. 633, 2014 WL 346617, 2014 La. App. LEXIS 203, Counsel Stack Legal Research, https://law.counselstack.com/opinion/king-v-pontchartrain-mortgage-co-lactapp-2014.