Marcello v. Bussiere

269 So. 2d 285, 1972 La. App. LEXIS 5841
CourtLouisiana Court of Appeal
DecidedNovember 8, 1972
DocketNo. 4998
StatusPublished
Cited by2 cases

This text of 269 So. 2d 285 (Marcello v. Bussiere) 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
Marcello v. Bussiere, 269 So. 2d 285, 1972 La. App. LEXIS 5841 (La. Ct. App. 1972).

Opinions

LEMMON, Judge.

This appeal involves two contracts, (1) a written agreement to purchase a business known as the “Joy Lounge” and certain specified equipment, and (2) a verbal sublease of the immovable property used in the operation of the business.

Pascal Marcello commenced these proceedings by filing suit on the lease based on the failure of his sublessees, Frederick J. Bussiere and Virginia C. Bussiere, to pay the monthly rental payments. He further sought to sequester the equipment located on the leased premises. The Bus-sieres answered and alleged that the lease was to begin only after Marcello formally transferred the business and equipment pursuant to the written agreement to purchase, which allegedly was never done. They also filed a reconventional demand seeking the return of the purchase price of the equipment and of the rental for two months paid by them on a month to month basis, as well as the cost of good faith renovation and repairs and the loss of expected income.

After a trial on the merits, judgment was rendered awarding Marcello the rent due during the time the Bussieres occupied the premises. The judgment also annulled the sale and awarded the Bussieres the purchase price of the equipment, which was ordered returned to Marcello. Mar-cello appealed, and the Bussieres answered the appeal.

Marcello had leased the immovable property from the owner since 1960 and had previously subleased the premises as a cocktail lounge. However, the City of Gretna had revoked the alcoholic beverage license of the last operator of the lounge, and the premises had not been used for about six months prior to the negotiations pertinent to this lease.

Fred Bonvillion, a lifetime resident of the area, had become friends with the Bus-sieres, who had just moved from New Hampshire and were looking for a business opportunity. Upon learning from Bonvil-lion of the availability of the Joy Lounge, the Bussieres met with Marcello and inspected the premises and the equipment.

[287]*287On or about April 24, 1970 the parties entered into a written agreement to buy and sell “the following described business in Jefferson Parish, Louisiana, to-wit:

“That business known as ‘THE JOY LOUNGE’ located at 319 Huey P. Long Avenue, Gretna, Louisiana, and to all the equipment described as follows: * * * ” (Emphasis supplied)

The agreement further provided that the act of sale was to be passed within 30 days and the consideration of $6,500.00 was due at the time of the sale. Additionally, the parties agreed that the Bussieres would immediately “take possession of said business” and “assume all liabilities for the necessary expenses, taxes and insurance associated with the conducting of the said business.”

On May 14, 1970 the Bussieres paid the $6,500.00 purchase price of the business and equipment and then began extensive renovation of the premises. However, no formal act of sale nor written lease contract were executed. On June 8, 1970 they paid rent, electricity and insurance in the amount of $340.00.

The Bussieres abandoned renovation work in early July after they received information that the City officials would not issue an alcoholic beverage license. When they refused to pay any further rent in response to a July 16 letter from Marcello’s attorney, this suit was filed.

Apparently all parties were well satisfied with the agreements until the problem arose concerning the license. In that regard Bussiere testified that Marcello represented in the early negotiations that he was influential with the City officials and could obtain a license. He advised the Bus-sieres to complete the planned renovation, after which he would bring the proper officials to inspect the place and would obtain a license. When the Bussieres heard that the City officials did not intend to issue a license at that location, they abandoned the renovation and requested the return of their money.

On the other hand, Marcello testified that he did not offer or promise to obtain a license or to assist the Bussieres in obtaining one. As to the sale, he simply delivered the equipment when the purchase price was paid. As to the lease, he verbally agreed to sublease the premises for $250.00 per month, or $50.00 more than the monthly rental that he was paying, for a term of two years, with certain options for additional time. He further stated that he instructed his attorney to draft the formal sale and lease, but that the Bussieres refused to accept an appointment to sign these documents.

Marcello also observed that the Bus-sieres were well aware they were not buying a going business, since at the time of their inspections the place was closed, and he in fact had begun remodeling the premises.

The trial judge found that the parties had entered into a verbal lease of the premises and awarded Marcello the amount of rent due from the time the Bussieres occupied the premises until the time they effectively cancelled the lease because of the license problem. However, he annulled the sale on the grounds of failure of consideration and error, finding that the parties contemplated the sale of a business as well as equipment. He further found that the business “was inoperative, non-existent and possessed neither good will nor the ability to function in view of the attitude of Gretna officials toward its reputation.” Accordingly, he rendered judgment in favor of the Bussieres on their reconventional demand for the purchase price of the equipment, which was ordered returned to Marcello.

Essentially, the judgment of the trial court as to the sale turned on the conclusion that the principal consideration for the Bussieres’ consent was the purchase of [288]*288both business and equipment, not merely the equipment. We believe that conclusion was in error under the facts and circumstances of this case.

We agree that Marcello’s use of the word “business” in the agreement to purchase meant something in addition to the equipment itemized in that agreement. However, we believe that “business”, as used there, simply meant whatever good will and intangible assets were carried over from the former operations on the premises, including the use of the name “Joy Lounge.”

We are supported in this interpretation by the further provision in the written instrument that vendee could take “possession of said business” upon execution of the agreement to purchase. All parties were fully aware that there was no business in operation of which possession could be taken, since the Joy Lounge was not operating at the time the Bussieres inspected the premises nor at the time they executed the agreement to purchase. The right to take possession of the business simply gave them the right to commence operations immediately upon signing the executory contract without waiting for the formal sale.

We conclude that the existence of a business was not a principal consideration for which the Bussieres consented to the sale.

We view the crucial issue in this case a§ whether or not the sale and lease can be invalidated because of a defect or vice of consent grounded on fraud or error. C.C. art. 1819 et seq.

As to fraud, it is undisputed that Marcello was aware during the negotiations that the Bussieres intended to lease the premises and purchase the equipment for the purpose of operating a cocktail lounge.

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Related

Marcello v. Bussiere
271 So. 2d 258 (Supreme Court of Louisiana, 1973)

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Bluebook (online)
269 So. 2d 285, 1972 La. App. LEXIS 5841, Counsel Stack Legal Research, https://law.counselstack.com/opinion/marcello-v-bussiere-lactapp-1972.