Little Bell, LLC v. Centerpoint Energy, Inc.

838 F. Supp. 2d 522, 2012 WL 13971, 2012 U.S. Dist. LEXIS 786
CourtDistrict Court, W.D. Louisiana
DecidedJanuary 4, 2012
DocketCivil Action No. 09-712
StatusPublished
Cited by1 cases

This text of 838 F. Supp. 2d 522 (Little Bell, LLC v. Centerpoint Energy, Inc.) is published on Counsel Stack Legal Research, covering District Court, W.D. Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Little Bell, LLC v. Centerpoint Energy, Inc., 838 F. Supp. 2d 522, 2012 WL 13971, 2012 U.S. Dist. LEXIS 786 (W.D. La. 2012).

Opinion

RULING

ROBERT G. JAMES, Chief Judge.

Three motions for summary judgment are pending before the Court. The first Motion for Summary Judgment was filed by Defendants CenterPoint Energy, Inc. (“CenterPoint”); CenterPoint Energy Services, Inc. (“CES”); and Centerpoint Energy-Mississippi River Transmission, LLC (“CE-MRT”). [Doc. No. 63], Plaintiffs Little Bell, LLC; Martha Perry Amman (“Amman”); and Paula Perry Blackman (“Blackman”) filed an Opposition on October 25, 2011. [Doc. No. 75], Defendants filed a reply on November 8, 2011. [Doc. No. 80].

Plaintiffs filed a cross-Motion for Summary Judgment. [Doc. No. 69]. Defendants filed an Opposition on October 28, 2011. [Doc. No. 76].

Finally, Defendant CE-MRT and Intervenor CenterPoint Energy Gas Transmission Company, LLC (“CEGT”) filed a Joint Motion for Summary Judgment. [Doc. No. 70]. Plaintiffs filed an Opposition on October 18, 2011 [Doc. No. 74], and DefendanWIntervenor filed a Reply on November 1, 2011. [Doc. No. 78].

For the following reasons, Defendants’ Motion for Summary Judgment is GRANTED IN PART and DENIED IN PART, and Plaintiffs’ cross-Motion for Summary Judgment is DENIED. Accordingly, Plaintiffs’ Petition for Eviction [Doc. No. 1] is DISMISSED WITH PREJUDICE. Additionally, DefendantIntervenor’s Joint Motion for Summary Judgment is DENIED.

I. FACTS AND BACKGROUND

This lawsuit concerns two leases held by DefendanWLessee CE-MRT, which operates a natural gas pipeline and a compressor station on the leased property. Plaintiffs-Lessors filed a Petition for Eviction, alleging that CE-MRT breached the lease agreements.

Plaintiffs in this action are two individuals, Amman and Blackman, and one limited liability corporation, Little Bell. Little Bell’s two officers, Harvey Perry and John W. Perry, Jr., together with Amman and Blackman (sometimes referred to as “Lessors”), inherited a tract of land in More-house Parish, Louisiana. The land is subject to two 99-year leases (the “Leases”) currently held by CE-MRT (sometimes referred to as “Lessee”).

Plaintiffs, in their Motion for Summary Judgment [Doc. No. 69], seek a finding that Defendants’ alleged breach of the Leases entitles them to the remedies of lease termination and eviction.

Defendants, in their Motion for Summary Judgment [Doc. No. 63], seek: (1) a finding that there was never a breach of the Leases due to defective notice provided by Lessors; (2) that if there was a breach, this Court should apply judicial [525]*525control to maintain the Leases; and (3) that Plaintiffs acted in bad faith and thus their petition for lease termination and eviction constitutes an abuse of rights.

The Leases require Lessee to pay the property taxes assessed on the leased land. Under the Leases, if Lessee fails to pay the taxes, Lessors can pay the taxes and then make written demand on Lessee for reimbursement. If Lessee then fails to reimburse Lessors, after sixty days, Lessors have the right to terminate the Leases.

The original lessee paid the entirety of the consideration for the leased property to the original lessors at the beginning of the Leases’ respective terms. [See Doc. No. 64-1, Ex. A-l, A2], Lessors inherited the property without the prospect of receiving rents or sale income until the Leases expire in 2048 and 2050.1

The original lessee assigned the Leases to Defendant-Lessee, who subsequently underwent several name changes. [See Doc. No. 64-1, Ex. A-8 through A-10]. Lessee is currently named CE-MRT and is a wholly owned subsidiary of Center-Point. Lessors assert that they never received formal notification of the assignment of the Leases or Lessee’s name changes, although they were aware that the sign on the fence of the leased land periodically changed. [Doc. No. 69-3, p. 67].2

It is undisputed that Lessee paid the taxes assessed against the property from the inception of the leases through the 1998 tax year. Inexplicably, Lessee failed to pay the property taxes for the 1999 tax year. As a result, a portion of the property was sold at a tax sale in April 2000. On July 5, 2000, John Perry paid the 1999 property taxes and redeemed the property on behalf of Little Bell.3 Going forward, the taxing authority invoiced Little Bell, which paid the taxes for the leased property through 2008. During this period, neither John Perry nor Little Bell notified CE-MRT, or any of its affiliated corporate entities, of its failure to pay property taxes, nor did John Perry or Little Bell make written demand for reimbursement. Plaintiffs assert that Little Bell (and by extension, its officers) was unaware that' it was paying property taxes over the ensuing eight-year period until the annual tax bill spiked by more than $1,000 in 2008 (from 2000-2007 the tax bill fluctuated between $223-$269). [Doc. No. 69-3, p. 6; Doc. No. 69-4, Ex. E].

On December 9, 2008, Little Bell sent a letter (“December 9 Letter”) to Center-Point at a P.O. Box in Houston, Texas, demanding reimbursement for taxes paid between 2000 and 2008. [Doc. No. 69-4, Ex. E]. Enclosed with the letter was a spreadsheet providing the amount of taxes paid each year by Little Bell and an assessment number. The spreadsheet applied an 8% interest rate to the tax payments, which resulted in a total amount of $4,057.14. The letter, signed “Little Bell, [526]*526LLC,” did not include a point of contact or phone number, a deadline for reimbursement, copies of the Leases, or identify the CenterPoint subsidiary leasing the property. The subject line of the letter merely stated: “Unpaid Property Taxes[,] More-house Parish Louisiana [,] Paid by Little Bell, LLC.” CenterPoint received the letter on December 15. [Id.]

On that same day, Jane Cook, a property tax associate at CenterPoint, mailed a response to Little Bell in which she requested the name of the particular Center-Point subsidiary leasing the land and a more specific location for the land. In her letter (“December 15 Letter”), Cook pointed out that “CenterPoint Energy, Inc. has many subsidiaries and I need to know which one in particular is leasing the property and where the property is located in Morehouse Parish.” [Doc. No. 69-4, Ex. F]. Cook also requested a point of contact at Little Bell from whom she could obtain further information and provided a phone number that Little Bell could use to contact her. [Id.].

In a December 26, 2008 email exchange, Harvey Perry and John Perry discussed Cook’s letter:

Harvey Perry: What do you think we should do. If we contact them and prove they owe it they will pay it. If we don’t they will probably argue that we did not fully notify them. My thought is don’t do anything and take a shot at them.

John Perry: I agree with you!

[Doc. No. 64-1, Ex. A-ll], In a separate email on the same day, Harvey wrote to John: “I gave them the parish and the assessment number. They have all the information they need to research it. I feel pretty good about doing nothing.” [Id.].

On February 18, 2009, Lessors’ attorney sent a letter to CenterPoint notifying it of the termination of the Leases based on the non-payment of taxes (“Termination Letter”). [Doc. No. 64-1, Ex. A-5]. The Termination Letter included copies of both Leases (neither of which was enclosed nor specifically referenced in the December 9 Letter).

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838 F. Supp. 2d 522, 2012 WL 13971, 2012 U.S. Dist. LEXIS 786, Counsel Stack Legal Research, https://law.counselstack.com/opinion/little-bell-llc-v-centerpoint-energy-inc-lawd-2012.