Landry v. Base Camp Management, LLC

206 So. 3d 921, 2015 La.App. 1 Cir. 1377, 2016 La. App. LEXIS 1972
CourtLouisiana Court of Appeal
DecidedOctober 31, 2016
Docket2015 CA 1377
StatusPublished
Cited by4 cases

This text of 206 So. 3d 921 (Landry v. Base Camp Management, LLC) 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
Landry v. Base Camp Management, LLC, 206 So. 3d 921, 2015 La.App. 1 Cir. 1377, 2016 La. App. LEXIS 1972 (La. Ct. App. 2016).

Opinions

CHUTZ, J.

[gAt issue in this case is whether any cause of action lies against an adversary’s attorney for exceeding the scope of the mandate given to the attorney by his clients, where no intent or malice has been alleged. We find no cause of action is stated under these circumstances,

FACTS AND PROCEDURAL HISTORY

The following facts are not disputed. In 2010, the successful alligator hunters and seafood fishermen in Assumption Parish who star in the television series, Swamp People, Troy Landry and Jacob Landry, and company, Troy Landry Productions, LLC [“the Landrys”], retained Roy H. Maughan, Jr., The Maughan Law Firm, LLC, Base Camp Management, LLC, and Creative Media Solutions, LLC [“the Mau-ghan parties”], to assist them with their entertainment related pursuits. The first contractual agreement between the Lan-drys and Maughan parties was executed in 2010 [“Maughan I”], the same year that the Swamp People series commenced to air.

By 2011, the Landrys wished to renegotiate their contract to adjust their fee agreement with the Maughan parties. The Landrys retained attorney, Alfred S. Lipp-man, to represent them in the negotiations. The negotiations began in June 2011 and continued until October 2011, when a new professional services agreement was reached by the Landrys and Maughan parties [“Maughan II”]. The terms of Mau-ghan II included an arbitration clause, whereby the parties agreed to arbitrate any disputes that may arise out of the contract.

A year later, in November 2012, the Landrys terminated Maughan II. The Maughan parties subsequently sought payment for services they claimed were still owed to them under the terms of the contract.

This litigation began in June 2013, when the Landrys filed a Petition for Declaratory Judgment against the Maughan parties in the district court, seeking to |avoid Mau-ghan II, inter alia, on grounds the contract contained an unenforceable arbitration clause.1 According to the Landrys, the arbitration clause was unenforceable because it lacked the requisite disclosures [923]*923about the effect the attorney’s arbitration clause would have on their rights. The disclosure requirements cited by the Lan-drys stem from a Louisiana Supreme Court decision that was issued after Mau-ghan II was executed, which requires attorneys to make certain disclosures to their clients in order to enforce an arbitration clause that is contained within an attorney-client . retainer agreement. See Hodges v. Reasonover, 2012-0043 (La. 7/2/12), 103 So.3d 1069, cert. denied, — U.S. —, 133 S.Ct. 1494, 185 L.Ed.2d 548 (2013).

The Maughan parties met the petition with an exception of prematurity, contending that the issues raised therein were subject to Maughan II’s arbitration provision and therefore had to be arbitrated before suit could be filed. After conducting a full evidentiary hearing on the matter, the district court denied the exception. In reasons for judgment, the district court found that it was incumbent on Mr. Lipp-man, as the Landrys’ attorney, to advise them of the full consequences of the arbitration clause. The court found that Mr. Lippman’s failure to make the disclosures rendered the arbitration clause void and unenforceable.

After the district court found that Maugham II’s arbitration clause was unenforceable, the Maughan parties filed a third-party petition against Mr. Lippman and his law firm, Lippman & Mahfouz, LLC [collectively referred to as “Attorney Lipp-man”], alleging that Attorney Lippman breached the duties he owed his clients, the Landrys, by failing to advise them that Maughan II contained an arbitration agreement and by failing to advise them of the legal effects of the 14arbitration clause.2 The Maughan parties then alleged that they were “direct, identifiable, and intended beneficiaries” of Attorney Lippman’s representation of the Landrys, such that they were entitled to recover damages as a result of the breach.

In response to the suit, Attorney Lipp-man filed exceptions raising the objections of no right and no cause of action, asserting, among other things, that the petition failed to state a cause of action in legal malpractice as the petition failed to allege that any attorney-client relationship existed between Attorney Lippman and the Maughan parties.

Before the exceptions were heard, the district court granted the Maughan parties leave to-file an amended third party petition [“the amended petition”]. Therein, the Maughan parties added a new allegation that Attorney Lippman exceeded the scope of the authority that was given to him by his clients, the Landrys, by including an arbitration agreement in Maughan II without obtaining the Landrys’ authorization to do so; by committing the Landrys to a for-cause termination provision when they were not authorized to do so; by committing the Landrys to an allegedly excessive fee for the services the Maughan parties would provide; by committing the Landrys to pay a combined fee for services rendered by the Maughan Law Firm and Base Camp Managément; and by committing the Landrys to every other complained of grievance enumerated in the Landrys’ petition for declaratory judgment. Consequently, the Maughan parties alleged that Attorney Lippman was liable to them—the intended beneficiaries of the Landrys’ engagement of Attorney Lipp-[924]*924man—under La. C.C. article 3019, which provides that a mandatary who exceeds his authority is personally bound to the third person |fiwith whom he contracts, unless that person knew at the time the contract was made that the mandatary had exceeded his authority or unless the principal ratifies the contract. The Maughan parties did not allege any facts tending to suggest that Attorney Lippman committed any intentional torts.

Attorney Lippman filed new exceptions raising the objections of no right and no cause of action in response to the amended petition, contending that the Maughan parties also lacked a right or cause of action under the theory of mandate. After a hearing, the district court granted Attorney Lippman’s exceptions in a judgment signed March 27, 2015. The March 27th judgment granted the Maughan parties 30 days to amend their pleading, but the Maughan parties did not file an amended petition within that timeframe. Subsequent to the expiration of the 30-day period, the district court entered a final judgment dismissing the Maughan parties’ claims against Attorney Lippman with prejudice. The Maughan parties have appealed the judgment sustaining Attorney Lippman’s exceptions.

DISCUSSION

On appeal, the Maughan parties present two arguments in support of their contention that they have stated a cause of action against Attorney Lippman. First, they argue that Louisiana courts have long recognized a cause of action brought against an attorney by a third-party, non-client, when the attorney exceeds the limits of his agency. Second, they argue that the First Circuit has previously recognized that a negligence cause of action may lie against an attorney when brought by a non-client, third-party beneficiary of the attorney’s work. See Blanchard v. Blanchard, 2012-0106 (La.App. 1 Cir. 12/31/12), 112 So.3d 243, 251, writ denied, 2013-0488 (La. 4/12/13), 111 So.3d 1013. In presenting these arguments, the Maughan parties attempt to distinguish the Louisiana Supreme Court’s decision in Montalvo v. Sondes, 93-2813 (La.

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206 So. 3d 921, 2015 La.App. 1 Cir. 1377, 2016 La. App. LEXIS 1972, Counsel Stack Legal Research, https://law.counselstack.com/opinion/landry-v-base-camp-management-llc-lactapp-2016.