Larry W. Bamburg, Individually and as Successor in Interest to Bamburg Heating and Air Conditioning, Inc. v. Air Systems, LLC

CourtLouisiana Court of Appeal
DecidedApril 14, 2021
Docket53,848-CA
StatusPublished

This text of Larry W. Bamburg, Individually and as Successor in Interest to Bamburg Heating and Air Conditioning, Inc. v. Air Systems, LLC (Larry W. Bamburg, Individually and as Successor in Interest to Bamburg Heating and Air Conditioning, Inc. v. Air Systems, 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
Larry W. Bamburg, Individually and as Successor in Interest to Bamburg Heating and Air Conditioning, Inc. v. Air Systems, LLC, (La. Ct. App. 2021).

Opinion

Judgment rendered April 14, 2021. Application for rehearing may be filed within the delay allowed by Art. 2166, La. C.C.P.

No. 53,848-CA

COURT OF APPEAL SECOND CIRCUIT STATE OF LOUISIANA

*****

LARRY W. BAMBURG, Plaintiff-Appellant INDIVIDUALLY AND AS SUCCESSOR IN INTEREST TO BAMBURG HEATING AND AIR CONDITIONING, INC.

versus

AIR SYSTEMS, LLC Defendant-Appellee

Appealed from the First Judicial District Court for the Parish of Caddo, Louisiana Trial Court No. 580308

Honorable Michael Pitman, Judge

MARK W. ODOM Counsel for Appellant

LISKOW & LEWIS Counsel for Appellee By: Paul M. Adkins

Before MOORE, GARRETT, and STONE, JJ. GARRETT, J.

In this breach of contract suit, the plaintiff, Larry W. Bamburg,

individually and as successor in interest to Bamburg Heating and Air

Conditioning, Inc. (collectively referred to hereinafter as “Bamburg”),1

appeals from a trial court judgment which awarded attorney fees of $82,464

and costs and disbursements of $3,844.57 in favor of the defendant, Air

Systems, LLC. The same judgment denied Bamburg’s claims against Air

Systems in the principal demand, as well as Air Systems’s reconventional

demand claims against Bamburg. The appeal is limited to one issue – the

trial court’s award of attorney fees to Air Systems as “the prevailing party.”2

We affirm the trial court judgment.

FACTS

To understand the complexity of the issues presented below, we find it

necessary to explain the background facts. Due to the paucity of evidence in

the appellate record, we have ascertained the following information from the

available pleadings and the trial court’s written opinion.

Both Bamburg and Air Systems were sellers, suppliers, installers, and

servicers of home heating and air conditioner systems in the Shreveport/

Bossier area. According to the trial court’s written opinion, Mr. Bamburg,

who was the president, sole director, and sole shareholder of his company,

was a “well-qualified HVAC technician” who lacked formal education in

1 However, where appropriate, such as when discussing his personal employment claims, we will refer to Larry Bamburg as “Mr. Bamburg.” 2 Due to the narrow focus of the appeal, the appellant significantly limited the designation of the record. No testimony was transcribed, and the appellant requested that only eight pleadings and two trial exhibits (the contract between the parties and a letter which Air Systems sent to Mr. Bamburg which was dated January 16, 2014) be made part of the appellate record. The only transcript included is a hearing held on January 6, 2020, which addressed the prevailing party issue. business and contracts, whereas John Dean, the manager of Air Systems, and

his wife/business partner, Lori Dean, were “sophisticated business owners

with little or no personal experience in installing and servicing HVAC

systems.” In 2012, Bamburg and Air Systems entered into an asset purchase

agreement (“APA”) whereby Air Systems purchased assets from Bamburg

and assumed certain liabilities. Bamburg was to be paid $100,000, plus a

“contingent amount,” minus the assumption by Air Systems of certain

liabilities. The APA specified that the “contingent amount” portion of the

purchase price was to be calculated as 30% of the “2013 Bamburg

Revenue,” which was defined as the revenue attributable to former Bamburg

customers during the 2013 calendar year. The contingent amount was to be

paid in two equal installments – the first no later than April 1, 2014, and the

second a year later. Additionally, Mr. Bamburg entered into an employment

agreement with Air Systems, which was attached to the APA as Exhibit K.3

Pursuant to an escrow agreement contained in the contract, the first

$100,000 of the purchase price was deposited into escrow and used to

discharge various Bamburg obligations. Mr. Bamburg signed the APA

without seeking legal advice.

The APA contained the following relevant provision:

8.3 Attorney Fees. If any legal action or other Legal Proceeding relating to any of the Transactional Agreements or the enforcement of any provision of any of the Transactional Agreements is brought against any party to this Agreement, the prevailing party shall be entitled to recover reasonable attorney fees, costs and disbursements (in addition to any other relief to which the prevailing party may be entitled).

3 The employment agreement gave Mr. Bamburg the position of field operations supervisor with base compensation of $29 per hour and a term of three years. It permitted his termination for several causes, including failure to comply with the company’s written policies.

2 Mr. Dean sent Mr. Bamburg a letter dated January 16, 2014,

informing him that he appeared to owe Air Systems in excess of $140,000.

In support of this, Mr. Dean cited (1) the disappointing volume of Bamburg

business for 2013, which was only about a third of what they expected, and

(2) the existence of extended parts and labor warranties promised to

customers which were not covered with purchases of contracts from

manufacturers and other third-party vendors. Mr. Dean candidly stated that

he would not have completed their transaction if he had been aware of the

latter issue. He also noted that he was under the impression that Mr.

Bamburg was not in a financial position to pay the amount due under the

agreement.

On October 16, 2014, Bamburg filed a petition for breach of contract,

injunctive relief, and unpaid wages against Air Systems. It alleged two

specific breaches of contract. The first claim asserted that Air Systems

failed to make the first installment of the contingent amount which was due

on April 1, 2014. It claimed that the 2013 Bamburg Revenue was greater

than $358,753.91, the amount reported by Air Systems in its letter. It further

alleged that Air Systems had limited the potential and actual sales amount

used to calculate the contingent amount. The petition stated that counsel for

Air Systems had sent a letter to Bamburg’s counsel, advising that Air

Systems did not owe any contingent amount under the agreement. As a

result, Bamburg claimed that the notice in the letter constituted an

anticipatory breach by Air Systems as to the final installment of the

contingent amount due on April 1, 2015. Pursuant to Section 8.9 of the

agreement, Bamburg requested injunctive relief ordering specific

performance of the agreement by payment of the contingent amount. Mr.

3 Bamburg contended that, upon the dissolution of his company on November

20, 2013, he assumed the right to receive the payments due under the

The second claim of contract breach concerned Mr. Bamburg’s

entitlement to wages as a fulltime employee. He asserted that Air Systems

attempted to unilaterally amend the employment agreement by limiting the

number of hours he worked to 30 hours per week, effectively converting

him to a part-time employee. Due to the two sets of alleged contract

breaches, he asserted that he was entitled to resign and that he did so. He

alleged that he was owed $5,684.58 in unpaid hours and overtime, plus

penalty wages and attorney fees under La. R.S. 23:632.

On November 14, 2014, Air Systems filed a pleading entitled

“Exceptions, Answer, and Reconventional Demand.”4 In its answer, Air

Systems made general denials and maintained that the documents at issue

were the best evidence.

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Larry W. Bamburg, Individually and as Successor in Interest to Bamburg Heating and Air Conditioning, Inc. v. Air Systems, LLC, Counsel Stack Legal Research, https://law.counselstack.com/opinion/larry-w-bamburg-individually-and-as-successor-in-interest-to-bamburg-lactapp-2021.