STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT
14-245
PETER JOSEPH WHITBECK, ET UX.
VERSUS
ROBERT JOSEPH CHAMPAGNE, JR., ET UX.
**********
APPEAL FROM THE THIRTY-EIGHTH JUDICIAL DISTRICT COURT PARISH OF CAMERON, NO. 10-19086 HONORABLE PENELOPE QUINN RICHARD, DISTRICT JUDGE
JOHN E. CONERY JUDGE
Court composed of Sylvia R. Cooks, Jimmie C. Peters, and John E. Conery, Judges.
AFFIRMED.
Raymond B. Landry Richard L. Traina Mollere, Flanagan & Landry L.L.C. 2431 Metairie Road Metairie, Louisiana 70001 (504) 837-4950 COUNSEL FOR DEFENDANTS/APPELLANTS: Robert Joseph Champagne, Jr. Charlet Ann Champagne John M.Veron J. Rock Palermo, III Michael Glenn Hodgkins Turner D. Brumby Veron, Bice, Palermo & Wilson, L.L.C. Post Office Box 2125 Lake Charles, Louisiana 70602-2125 (337) 310-1600 COUNSEL FOR PLAINTIFFS/APPELLEES: Peter Joseph Whitbeck Marissa Jill Whitbeck CONERY, Judge.
Robert and Charlet Champagne (Champagnes) appeal the trial court’s ruling
granting a motion for summary judgment in favor of Peter and Marissa Whitbeck
(Whitbecks). The trial court found the Champagnes in default of a July 2, 2012
Louisiana Residential Agreement to Buy and Sell (Purchase Agreement),1 wherein
the Champagnes agreed to purchase immovable property owned by the Whitbecks.
The trial court ordered the Champagnes to specifically perform under the terms
and provisions of the Purchase Agreement and pay the purchase price of
$450,000.00 to the Whitbecks. The trial court also found that the Whitbecks were
entitled to retain the $2,500.00 deposit given by the Champagnes and awarded
$17,700.00 in attorney fees plus $2,764.35 in costs to the Whitbecks, with judicial
interest from the date of judgment. The trial court denied the Whitbecks motion
for summary judgment seeking an award of broker or realtor fees. The Whitbecks
have answered the appeal and are seeking additional attorney fees and costs, an
award of broker or realtor fees, and attorney fees and costs in connection with the
appeal. For the following reasons, we affirm and award $2,500.00 in attorney fees
to the Whitbecks for work done on this appeal.
FACTS AND PROCEDURAL HISTORY
The Whitbecks’ home at 111 Seagull Lane, Big Lake, Louisiana 70607 (Big
Lake home) was listed on the market for sale. The Champagnes negotiated with
1 Louisiana Revised Statutes 37:1449.1, effective January 1, 2011, requires all licensed real estate agents to use this form in connection with an offer to buy or sell residential real estate. Louisiana Revised Statutes 37:1449.1 provides:
A licensee representing either the buyer or seller of residential real property shall complete the purchase agreement form prescribed by the Louisiana Real Estate Commission in making an offer to purchase or sell residential real property. No person shall alter the purchase agreement form; however, addendums or amendments to the form may be utilized. the Whitbecks for the purchase of the Big Lake home and the parties subsequently
agreed to a cash sale price of $450,000.00. The initial offer was made to the
Whitbecks on June 30, 2012. The Whitbecks accepted the Champagnes’ offer in
writing by signing the Purchase Agreement on July 2, 2012.
Under the specific provisions of the Purchase Agreement, the Champagnes
had a fifteen day period to fully inspect the Big Lake home and were allowed to
conduct any inspections they deemed necessary. The inspection period began to
run on July 3, 2012, the day after the Whitbecks accepted the Champagnes’ cash
offer, and ended on July 17, 2012.2
During the fifteen day inspection period, the Champagnes admit they were
given free rein to inspect the Big Lake home and conducted at least three viewings
or inspections of the home. One of the inspections was conducted by an engineer
with Spell Structural Consulting, L.L.C., and included a structural review of both
the interior and exterior of the Big Lake home. The conclusion of the engineering
inspector was that the interior of the Big Lake home was “in good condition and no
structurally deficient issues were observed with interior finishes.”
2 Lines 141-150 of the Purchase Agreement provide:
Buyer shall have an inspection period of (15) calendar days, commencing the first day after acceptance of this agreement wherein, BUYER may, at BUYER’S expense, have any inspections made by experts or others of his choosing. Such inspections may include, but are not limited to, inspections for termites and other wood destroying insects, and/or damage from same, molds, and fungi hazards, and analysis of synthetic stucco, drywall, appliances, structures, foundations, roof, heating, cooling, electrical, plumbing systems, utility and sewer availability and condition, out-buildings, square footage, school district, flood zone classifications, current zoning and/or subdivision restrictive covenants and any items addressed in the SELLER’S Property Disclosure Document. All testing shall be nondestructive testing. SELLER agrees to provide the utilities for inspections and immediate access. If BUYER is not satisfied with the condition of the Property the BUYER may choose one of the following options within the inspection period[.]
2 In addition, the Whitbecks were required to disclose the following on the
Property Disclosure Form, “Has there been property damage related to the land or
the improvements thereon, including, but not limited to, fire, windstorm, flood, hail,
lighting, or other property damage?” The Whitbecks responded “yes[,]” and that
the repairs related to those damages, defects, and/or other conditions had been
made to the Big Lake home.
During the fifteen day inspection period, the Champagnes asked for
additional information about the repairs made, especially those made to the Big
Lake home after Hurricane Ike. The Whitbecks responded on July 10, 2012, with a
detailed listing and dates of when approximately ten repairs were made to the Big
Lake home. The Whitbecks’ response was sent to the Champagnes a week before
the end of the fifteen day inspection period.
Under the provisions of the Purchase Agreement, if the Champagnes found
any deficiencies in the Big Lake home within the fifteen day inspection period,
they could “elect in writing, to terminate the Agreement and declare the Agreement
null and void,” or “indicate in writing the deficiencies and desired remedies,”
giving the Whitbecks as the sellers seventy-two hours to respond in writing as to
their willingness to remedy those deficiencies.3 The Champagnes did not exercise
either of these options within the fifteen day inspection period.
Under the provisions of the Purchase Agreement, the Champagnes’ silence
was presumed acceptance once the fifteen day inspection period expired, as the
3 Lines 152-155 of the Purchase Agreement provide:
Option 1: BUYER may elect, in writing, to terminate the Agreement and declare the Agreement null and void; or Option 2: BUYER may indicate in writing the deficiencies and desired remedies and SELLER will within seventy two (72) hours respond in writing as to SELLER’s willingness to remedy those deficiencies (“SELLER’s Response”).
3 Purchase Agreement stated that “FAILURE TO MAKE INSPECTIONS OR TO
GIVE WRITTEN NOTICE OF DEFICIENCIES AND DESIRED REMEDIES TO
SELLER (OR SELLER’S DESIGNATED AGENT) AS SET FORTH IN LINES
141 THROUGH 155 WITHIN THE INSPECTION PERIOD SHALL BE
DEEMED AS ACCEPTANCE BY BUYER OF THE PROPERTY’S CURRENT
CONDITION.”
In addition, under the terms of the Purchase Agreement, the Champagnes
agreed to accept the Big Lake home in an “‘as is’ condition” and to “waive, relieve
and release” the Whitbecks from any further actions for redhibition and reduction
of the sale price. The Champagnes also acknowledged the sale of the Big Lake
home was to be made “without warranty of fitness for ordinary or particular use”
and that both parties agreed that this language was to be part of the Act of Sale.4
Based on the Champagnes’ silence and deemed acceptance of the condition
of the Big Lake home, the parties proceeded with the sale process. They mutually
agreed to close the sale of the Big Lake home on Monday, July 23, 2012. However,
on the morning of July 23, 2012, the Champagnes informally notified the
Whitbecks of their intention not to finalize the sale. The Champagnes indicated
they had received information from a third-party that the Big Lake home had a
“mold and mildew issue.” This informal notification by the Champagnes of a 4 Lines 189-195 of the Purchase Agreement provide:
B. SALE “AS IS” WITHOUT WARRANTIES: SELLER and BUYER hereby acknowledge and recognize that the Property being sold and purchased is to be transferred in “as is” condition and further BUYER does hereby waive, relieve and release SELLER from any claims or causes of action for redhibition pursuant to Louisiana Civil Code Article 2520, et seq. and Article 2541, et seq. or for reduction of Sale Price pursuant to Louisiana Civil Code Article 2541, et seq. Additionally, BUYER acknowledges that this sale is made without warranty of fitness for ordinary or particular use pursuant to Louisiana Civil Code Article 2524. SELLER and BUYER agree that this clause shall be made a part of the Act of Sale.
4 potential “mold and mildew issue” was the first time the Whitbecks were notified
that the Champagnes had any reservations about either the condition of the Big
Lake home or finalizing the sale of the property.
The next day, July 24, 2012, the Champagnes formally notified the
Whitbecks of their intention not to purchase the Big Lake home. The Champagnes
gave as their only reason that they had elected “not to move forward with the
purchase of the above mentioned property on the basis of non disclosure by the
sellers.” They further requested “release of the escrowed funds of $2,500.00.” In
response, and in order to dispel the third-party rumor of mold and mildew issues,
the Whitbecks gave the Champagnes complete freedom to take whatever steps they
deemed necessary to satisfy themselves that the Big Lake home was free from
mold and mildew. This offer by the Whitbecks to the Champagnes was confirmed
by Mr. Champagne under oath. He testified that his own real estate agent, Mrs.
Rhonda Gaspard, informed him that the Whitbecks were willing to allow the
Champagnes to conduct all inspections necessary to confirm that mold was not
present in the Big Lake home. In an effort to break the impasse between the
parties and to impress on the Champagnes the seriousness of their actions in
refusing to complete the sale as per the Purchase Agreement, Mrs. Gaspard, in a
July 23, 2012 correspondence, urged the Champagnes to “investigate further” in
order to determine if there was a real basis for the third-party mold rumor. She
also suggested that the Champagnes have someone check with a moisture meter for
any moisture in the walls or tear out the sheetrock in the suspected area.
Mrs. Gaspard also told the Champagnes that her broker, Tim Flavin, was of
the opinion that the Champagnes were contractually bound to close on the Big
Lake home unless they could prove there was a mold problem and that it had been
5 covered up by the Whitbecks. Mrs. Gaspard further informed the Champagnes that
the Whitbecks intended to seek specific performance of the Purchase Agreement.
She then suggested, once again, that the sheetrock be torn out in the area in
question and that an expert be called to confirm the absence or presence of mold or
any structural defects.
The Champagnes never took advantage of the Whitbecks’ offers to conduct
any and all inspections necessary to satisfy themselves that the Big Lake home was
mold free. It is undisputed that the Champagnes never hired anyone to conduct a
mold assessment of the Big Lake home. Due to the Champagnes failure to address
the mold rumor, and in an attempt to resurrect the sale, the Whitbecks hired their
own environmental professional, Booth Environmental Services, LLC (Booth).
Booth performed a “Moisture and Mold Assessment Sampling” and a “MOLD
ASSESSMENT REPORT,” dated August 6, 2012. The report, which was
introduced into evidence, contained two opinions. In the first Booth opinion, the
Booth inspector states, “according to the air samples, the indoor area is not
considered to be elevated at the time of the inspection.” The Booth opinion also
states, “there was also no visible evidence observed by the Booth Environmental
staff to suggest that an issue existed with elevated mold at the time of inspection.”
The Whitbecks sent a copy of the Booth report to the Champagnes on
August 8, 2012, and insisted that they finalize the sale. The Champagnes
maintained their position and refused to close the sale of the Big Lake home,
despite taking no steps to provide evidentiary support for their contention that the
Whitbecks failure to disclose a mildew and mold problem in the Big Lake home
was a breach of the Purchase Agreement.
6 Ms. Rhonda Gaspard, the Champagnes’ realtor, requested that the
Champagnes obtain an affidavit from Mr. Stanley Schiele, a local contractor, and
the supposed “third-party source” of the mold rumor at the Big Lake home. The
affidavit was not forthcoming until two months after the initial July 23, 2012
closing date for the sale of the property. Mr. Schiele’s affidavit failed to support
the Champagnes’ contention that the Whitbecks had failed to disclose a mold
problem in the Big Lake home and only stated there was “potential for mold.” Mr.
Schiele also testified via deposition that despite working as a contractor in the area
for a number of years, he “never encountered any black mold in the Big Lake area.”
The Whitbecks filed suit against the Champagnes on September 5, 2012,
seeking specific performance 5 of the Purchase Agreement, retention of the
Champagnes’ deposit, both attorney and broker fees, and costs.6 The Whitbecks
claimed that the Champagnes had breached the Purchase Agreement by failing to
complete the sale on the Big Lake home. The Champagnes reconvened seeking
the return of their deposit, along with costs and attorney fees.
At the close of discovery, during which the depositions of the parties, the
realtors and Mr. Schiele, the source of the third-party mold rumor, were taken, the
5 Lines 228-232 of the Purchase Agreement provide:
DEFAULT OF AGREEMENT BY BUYER: In the event of any other default of this agreement by BUYER except as set forth in lines 103 through 122, SELLER shall have at SELLER’s option the right to declare this Agreement null and void with no further demand, or to demand and sue for any of the following: 1) Termination of this Agreement; 2) Specific Performance; 3) Termination of this Agreement and an amount equal to 10% of the Sale Price as stipulated damages. 6 Lines 234-236 of the Purchase Agreement provide, “Further, SELLER shall be entitled to retain the Deposit. The prevailing party to any litigation brought to enforce any provision of this Agreement shall be awarded their attorney fees and costs. The BUYER may also be liable for Broker fees.”
7 Whitbecks filed a motion for summary judgment. A hearing on the Whitbecks’
motion was held on July 24, 2013. After considering all the depositions, pleadings,
and affidavits in support of and in opposition to the motion, the trial court granted
the Whitbecks’ motion for oral reasons assigned. The trial court ruled that the
Whitbecks were entitled to specific performance of the Purchase Agreement and
awarded judgment in the amount of $450,000.00 to the Whitbecks in accordance
with the contract. The trial court also allowed the Whitbecks to retain the
$2,500.00 deposit without credit toward the sales price, plus costs, and indicated it
would make an award of attorney fees. The court ordered briefing and set an
additional hearing for September 4, 2013, on both the attorney and broker fees
issue.
Counsel for the Whitbecks submitted a detailed attorney fees claim for $30,
850.00. After receipt of post-motion briefing, the trial court held the September 4,
2013 hearing as scheduled. On September 30, 2013, the trial court issued its
written ruling and awarded the Whitbecks $17,700.00 in attorney fees,
approximately half the amount claimed, plus costs of $2,764.35. The trial court
also denied the Whitbecks’ request for broker fees. A final judgment was signed
on October 29, 2013, from which the Champagnes have filed a timely suspensive
appeal. The Whitbecks have answered the appeal and seek an increase of the
attorney fees award to $30,850.00, the original amount claimed, an award of
broker’s fees, plus attorney fees and costs for the appeal.
ASSIGNMENTS OF ERROR
The Champagnes argue the trial court erred by granting the Whitbecks’
motion for summary judgment and ordering specific performance of the Purchase
Agreement.
8 In their answer to appeal, the Whitbecks argue that the trial court erred in not
granting the total amount of attorney fees sought and in failing to award the
Whitbecks broker or realtor fees. The Whitbecks seek an additional award of
attorney fees and costs for the appeal.
LAW AND DISCUSSION
Standard of Review
Summary judgments are reviewed de novo, applying the same standard to
the matter as that applied by the trial court. Smith v. Our Lady of the Lake Hosp.,
Inc., 93-2512 (La. 7/5/94), 639 So.2d 730. Summary judgment is favored by law
and provides a vehicle by which the just, speedy, and inexpensive determination of
an action may be achieved. La.Code Civ.P. art. 966(A)(2). The trial court is
required to render summary judgment “if the pleadings, depositions, answers to
interrogatories, and admissions, together with the affidavits, if any, admitted for
purposes of the motion for summary judgment, show that there is no genuine issue
as to material fact, and that mover is entitled to judgment as a matter of law.”
La.Code Civ.P. art. 966(B)(2). In this case, all documentation in support of and in
opposition to the Whitbecks motion for summary judgment was properly admitted
into evidence at the July 24, 2013 hearing. Though heard as a motion for summary
judgment, it appears that the parties in effect introduced the entirety of the
evidence by way of depositions, affidavits, and exhibits, and the Court, after
considering all the evidence submitted at the hearing, made a ruling that no
material facts remained for trial.
In 1997, the legislature enacted La.Code Civ.P. art. 966(C)(2), which
clarified the burden of proof for a summary judgment proceeding. The initial
burden of proof remains with the mover to show that no genuine issue of material
9 fact exists. If the mover has made a prima facie showing that the motion should be
granted, the burden shifts to the non-moving party to present evidence
demonstrating that a genuine material factual issue remains. Id. “[T]he failure of
the non-moving party to produce evidence of a material factual dispute mandates
the granting of the motion.” Hutchinson v. Knights of Columbus, Council No.
5747, 03-1533, p. 7 (La. 2/20/04), 866 So.2d 228, 233.
When a motion for summary judgment is made and supported, the adverse
party may not rest on the allegations or denials of his pleadings, but must set forth
specific facts showing that there is a genuine issue for trial. La.Code Civ.P. art.
967(B). “A fact is ‘material’ when its existence or nonexistence may be essential
to [a] plaintiff’s cause of action under the applicable theory of recovery. Smith,
639 So.2d at 751. “[F]acts are material if they potentially insure or preclude
recovery, affect a litigant’s ultimate success, or determine the outcome of the legal
dispute.” Id. (quoting S. La. Bank v. Williams, 591 So.2d 375, 377 (La.App. 3 Cir.
1991), writ denied, 596 So.2d 211 (La.1992)).
In determining whether a fact is material, we must consider the substantive
law governing the litigation. Davenport v. Albertson’s, Inc., 00-685 (La.App. 3 Cir.
12/6/00), 774 So.2d 340, writ denied, 01-73 (La. 3/23/01), 788 So.2d 427. In this
case, the substantive law of contracts is applicable.
Questions of contractual interpretation are questions of law, which are
subject to a de novo standard of review. Mitchell v. Patterson Ins. Co., 00-612
(La.App. 3 Cir. 12/6/00), 774 So.2d 366. Contracts have the force of law between
the parties, and the courts are bound to interpret them according to the common
intent of the parties. La.Civ.Code arts. 1983 & 2045. If the words of the contract
are clear, unambiguous, and lead to no absurd consequences, the court need not
10 look beyond the contract language to determine the true intent of the parties.
La.Civ.Code art. 2046. “Each provision in a contract must be interpreted in light
of the other provisions so that each is given the meaning suggested by the contract
as a whole.” La.Civ.Code art. 2050. Whether or not a contract is ambiguous is a
question of law. La. Ins. Guar. Ass’n. v. Interstate Fire & Cas. Co., 93-911
(La.1/14/94), 630 So.2d 759.
Terms of the Purchase Agreement
If the terms of the Purchase Agreement at issue are “clear and explicit and
lead to no absurd consequences, no further interpretation may be made in search of
the parties’ intent. La.Civ.Code art. 2046.” Gonsoulin v. Pontiff, 11-177, p. 5
(La.App. 3 Cir. 10/5/11), 74 So.3d 809. In this case, the Purchase Agreement at
issue is the standard form required by the Louisiana Real Estate Commission in
connection with the sale and or purchase of a residential property. Thus, the trial
court correctly found in its reasons for granting the Whitbecks’ motion for
summary judgment that the contract was clear and unambiguous and therefore the
law between the parties:
The Court finds that the contract in this matter is clear and unambiguous. It’s the law between the parties. The depositions confirm that the parties understood the contents of the contract. And it’s clear from the depositions and the contract that the Champagnes breached their duty under the contract.
So the Court’s going to grant the motion for summary judgment in favor of the plaintiffs; order specific performance; order the sellers retain the deposit; award attorney fees to be determined at a hearing, at a date and time set today. And the contract says, “May order broker fees.” I will determine at that hearing whether broker fees will be awarded.
The Champagnes argue that there are genuine issues of material fact that
preclude summary judgment in this case. However, in light of the depositions and
11 exhibits submitted by the Whitbecks and the clear and unambiguous wording of
the Purchase Agreement, we cannot agree. When a motion for summary judgment
is made and supported, the adverse party may not rest on the allegations or denials
of his pleadings, but must set forth specific facts showing that there is a genuine
issue for trial. La.Code Civ.P. art. 967(B).
The Champagnes failed to produce any expert testimony to support their
claim that the Whitbecks had failed to disclose the presence of mold or any
structural defect. Mr. Champagne testified in his deposition, after a discussion
about the mold inspection commissioned by the Whitbecks, that they had “no
scientific evidence to refute” the conclusions of Booth that there was no mold
present in the Big lake home.
Neither the affidavit nor the deposition testimony of Mr. Schiele supports
the Champagnes’ claim that the Whitbecks failed to disclose the presence of mold.
Mr. Schiele testified under oath that water spots he observed on a ceiling in one of
the rooms only have the “potential for mold” and that he had never encountered
“black mold” in the Big Lake area.
The Champagnes also argue the Whitbecks failed to disclose that a window
had been replaced in the same room which had water spots on the ceiling. This
issue was thoroughly discussed by Mr. Schiele in his deposition as a “potential”
source of mold. However, Mr. Schiele also confirmed that he never saw mold in
the Big Lake home.
The Property Condition Disclosure Form was not a part of the record, but we
12 allowed the parties to supplement the record with the form and have reviewed it.7
The alleged undisclosed repairs were thoroughly discussed in the deposition of Mr.
Champagne wherein he admitted that he had no evidentiary support that any
alleged undisclosed repairs by the Whitbecks met the definition of a “Known
defect” on the Property Disclosure Form. A “Known defect” is defined in the
Property Disclosure Form, as “a condition found within the property that was
actually known by the seller and that results in one or all of the following.” The
“Known defect” either presents a “substantial adverse effect on the value of the
property,” “significantly impairs the health or safety of any future occupants[,]” or
“significantly shortens the expected normal life of the premises” if the repairs are
not made.
Based on the uncontradicted evidence submitted at the motion for summary
judgment, and the clear terms of the Purchase Agreement, we find there is no
genuine issue of material fact to defeat the Whitbecks’ motion for summary
judgment.
The Champagnes were given carte blanche to inspect the house by the
Whitbecks, who asserted all through this process that they had nothing to hide.
The Champagnes were free to take any measures necessary to assure there was no
mold or structural defect present in the Big Lake house, including tearing out the
sheetrock in the bedroom in question, as recommended by their realtor. The
Champagnes failed to do so.
The Champagnes have failed to present any documentary evidence or
testimony to create a genuine issue of material fact sufficient to defeat the motion
7 The Property Disclosure Form is now required by the Louisiana Real Estate Commission as provided by La.R.S. 9:3196, et seq. The form used was in compliance with the statute.
13 for summary judgment sought by the Whitbecks. We affirm the trial court’s ruling
granting summary judgment to the Whitbecks for the Champagnes breach of the
Purchase Agreement.
Stipulated Damages in the Purchase Agreement
The Champagnes argue that the trial court erred in granting specific
performance in favor of the Whitbecks and ordering them to execute the Purchase
Agreement for the cash price of $450,000.00. The Purchase Agreement clearly
states that “specific performance” is one of the three options available to the Seller
when the Buyer breaches the Purchase Agreement. The Purchase Agreement
states that the seller may “demand and sue for any of the following: 1) Termination
of this Agreement; 2) Specific Performance; 3) Termination of this Agreement and
an amount equal to 10% of the Sale Price as stipulated damages.”
The Champagnes argue that the trial court is required to choose the option to
be exercised in the event of a breach of the Purchase Agreement. However, the
clear language of the Purchase Agreement provides, “SELLER shall have at
SELLER’s option the right” to choose the remedy for the Champagnes’ breach of
the Purchase Agreement. Documentation presented in support of the motion for
summary judgment clearly provides that from the date of the closing when the
Champagnes refused to go through with the sale, the Champagnes were on notice
from both their broker, Tim Flavin, and their realtor, Rhonda Gaspard, that the
Whitbecks intended to seek specific performance of the Purchase Agreement
should the Champagnes choose not to perform.
Louisiana Civil Code Article 1986 provides:
Upon an obligor’s failure to perform an obligation to deliver a thing or not to do an act, or to execute an instrument, the court shall grant specific performance plus damages for delay if the obligee so
14 demands. If specific performance is impracticable, the court may allow damages to the obligee.
Upon a failure to perform an obligation that has another object, such as an obligation to do, the granting of specific performance is at the discretion of the court.
(Emphasis added.)
In Charter Sch. of Pine Grove v. St. Helena Parish Sch. Bd., 07-2238, p.14
(La.App. 1 Cir. 2/19/09), 9 So.3d 209, 222, our sister circuit succinctly discussed
La.Civ.Code art. 1986 and the jurisprudence applicable to a breach of a contract
that contains a provision for specific performance:
Upon an obligor’s failure to perform an obligation to do, the granting of specific performance is at the discretion of the court. See LSA–C.C. art.1986. Under Louisiana’s civil law system, specific performance is the preferred remedy for breach of contract. An obligee enjoys the right to demand, insofar as is practicable, the specific performance of the obligation. Lombardo v. Deshotel, 94– 1172 (La.11/30/94), 647 So.2d 1086, 1090; see LSA–C.C. art.1986. An obligee has a right to specific performance for breach of contract except when it is impossible, greatly disproportionate in cost to the actual damage caused, no longer in the creditor’s interest, or of substantial negative effect upon the interests of third parties. J. Weingarten, Inc. v. Northgate Mall, Inc., 404 So.2d 896, 901 (La.1981).
The Champagnes argue that the trial court erred in enforcing the Whitbecks’
claim for specific performance for the agreed upon sum of $450,000.00 cash, as it
would be “impracticable” to force the Champagnes to acquire ownership of the Big
Lake home. After the purchase, if the alleged defect of mold was discovered, the
discovery would lead to another lawsuit, an action in redhibition, pursuant to
La.Civ.Code art. 2520.
However, under the explicit terms of the Purchase Agreement, the
Champagnes agreed, “the Property being sold and purchased is to be transferred in
‘as is’ condition and further BUYER does hereby waive, relieve and release
15 SELLER from any claims or causes of action for redhibition pursuant to Louisiana
Civil Code Article 2520, et seq. and Article 2541, et seq. or for reduction of Sale
Price pursuant to Louisiana Code Article 2541, et seq.” They also agreed, “[t]hat
this sale is made without warranty of fitness for ordinary or particular use
pursuant to the Louisiana Civil Code Article 2524. SELLER and BUYER agree
that this clause shall be made a part of the Act of Sale.”
In Ross v. Premier Imports, 96-2577 (La.App. 1 Cir. 11/7/97), 704 So.2d 17,
21, writ denied, 97-3035 (La. 2/13/98), 709 So.2d 750, the first circuit provided
that a seller may “limit his obligations as seller, providing he does so clearly and
unambiguously.” In Keaty v. Moss Motors, Inc., 93-1452 (La.App. 3 Cir. 6/1/94),
638 So.2d 684, 687, writ denied, 94-2211 (La. 11/11/94), 644 So.2d 399, a panel
of this court specified that for the conditions necessary for the waiver to be
effective, the contractual waiver must, “(1) be written in clear and unambiguous
terms; (2) be contained in the contract; and, (3) either be brought to the attention of
the buyer or explained to him.”8
The trial court specifically found that the contract was “clear and
unambiguous” and that it was “the law between the parties.” In addition, the trial
court found that “the depositions confirm the parties understood the contents of the
contract.” Based on the trial court’s findings that there was no genuine issue of
material fact, and our review of the Purchase Agreement and the record, we find
that the uncontradicted facts support the conclusion that the provisions of the
contract are enforceable against the Champagnes and present no bar to the remedy
of specific performance granted by the trial court. This conclusion is further
8 Louisiana Civil Code Article 2548, amended by La. Acts 1993, No.841 § 1, codified the jurisprudential requirements and became effective January 1, 1995.
16 supported by the Champagnes’ failure to produce any evidence to support their
contention that the Big Lake home contained mold or any defect that would qualify
as a basis for refusal to honor the Purchase Agreement.
Louisiana Civil Code Article 2005 allows parties to “stipulate the damages
to be recovered in case of nonperformance, defective performance, or delay in
performance of an obligation.” Further, “[T]hat stipulation gives rise to a
secondary obligation for the purpose of enforcing the principal one.” Louisiana
Civil Code Article 2012 also instructs, “Stipulated damages may not be modified
by the court unless they are so manifestly unreasonable as to be contrary to public
policy.” Neither party has argued that the stipulated damages are “so manifestly
unreasonable as to be contrary to public policy.” Id.
The parties agreed in the Purchase Agreement to a cash price for the Big
Lake home of $450,000.00. The trial court granted specific performance to the
Whitbecks based on the stipulated damage provisions in the Purchase Agreement
and ordered the Champagnes to perform according its terms, finding the Purchase
Agreement was “the law between the parties.”
In Stumpf v. Richardson, 99-415, p. 5 (La.App. 5 Cir. 11/30/99), 748 So.2d
1225, 1227-28, the trial court found that the contract included a clause for specific
performance, that the terms of the contract had been met, and thus granted specific
performance to the sellers and ordered the buyer to pay the agreed to price of
$525,000.00. The buyer refused to complete the sale for the negotiated price of
$525,000.00, the value of the property in the lender’s appraisal, after having the
property appraised at $378,000.00 in her separate appraisal. The court in Stumpf
based its ruling on City of Kenner v. Jumonville, 97-125 (La.App. 5 Cir. 8/27/97),
701 So.2d 223, 228, writ denied, 97-2890 (La.1/30/98), 709 So.2d 718, cert.
17 denied, 524 U.S. 953, 118 S.Ct.2371 (1998), and stated, “Courts ‘cannot
undermine a contract simply because it was a bad deal, or is believed to be, for one
of the parties.’”
The same principle applies in this case. We agree with the trial court that
specific performance was properly granted as a remedy to the Whitbecks for the
Champagnes’ failure to perform under the clear terms of the Purchase Agreement.
Duty to Mitigate
The Champagnes argue that the Whitbecks had a duty to mitigate the
stipulated damages by continuing to market their Big Lake home to try and find
another buyer for the property. Louisiana Civil Code Article 2002 provides, “An
obligee must make reasonable efforts to mitigate the damage caused by the
obligor’s failure to perform. When the obligee fails to make these efforts, the
obligor may demand that the damages be accordingly reduced.” In Lombardo v.
Deshotel, 94-1172 (La. 11/30/94), 647 So.2d 1086, the supreme court discussed
the conflict between La.Civ.Code art. 2002 and stipulated damage provisions in a
contract. In Lombardo, the supreme court held that La.Civ.Code art. 2002 was not
applicable and there was no duty on the part of the obligee to mitigate his damages
when stipulated damages were part of the contractual obligation of the obligor:
The obligee can recover no more nor less than the stipulated damages regardless of the amount of damage or the consequences caused by the obligee’s neglect. Consequently, because the seller, Lombardo, could not suffer a reduction of her stipulated damages and therefore owed no duty to mitigate her damage to the purchaser.
Lombardo, 647 So.2d at 1092 (emphasis added).
We agree that the trial court correctly interpreted the terms of the Purchase
Agreement providing for specific performance by requiring the Champagnes to
18 perform under the terms of the Purchase Agreement and purchase the Big Lake
home for the agreed to cash price of $450,000.00.
Remaining Damages Awarded by the Trial Court
The Purchase Agreement also provides, “Further, SELLER shall be entitled
to retain the Deposit. The prevailing party to any litigation brought to enforce any
provision of this Agreement shall be awarded their attorney fees and costs. The
BUYER may also be liable for Broker fees.”
The trial court, under the provisions of the Purchase Agreement, correctly
awarded the $2,500.00 deposit to the Whitbecks without a reduction of the
purchase price of the Big Lake home. Also, under the terms of the Purchase
Agreement, the trial court awarded the Whitbecks their requested costs of
$2,764.35. The Champagnes did not brief either of these issues to this court on
appeal and therefore pursuant to Uniform Rules—Courts of Appeal, Rule 2–12.4,
these issues are considered abandoned.
The Whitbecks’ Answer to Appeal
The Whitbecks have answered the appeal and seek the following, “(i) a
modification of the trial court judgment to increase the award of attorneys’ fees, (ii)
a modification and/or reversal of the judgment to grant an award of broker fees,
and (iii) an award of attorneys’ fees and costs incurred in connection with this
appeal.”
Attorney Fees
After granting the Whitbecks’ motion for summary judgment, the trial court
deferred ruling on the attorney fee and broker’s fee issues and requested that
counsel submit a post hearing memoranda on these issues. The trial court then
heard oral argument on these issues at a hearing on September 4, 2013. In support
19 of their request for attorney fees and costs, Turner D. Brumley, counsel for the
Whitbecks, had submitted a memorandum and a sworn affidavit with
documentation supporting one hundred and eighteen hours of work on the
Whitbecks’ lawsuit for a total of $30,850.00 in attorney fees and $2,764.35 in costs.
In their opposition memorandum, counsel for the Champagnes claimed that
the amount of attorney fees “requested by the Whitbecks for attorney fees is about
twice as much as would be appropriate under the circumstances revealed by the
record of this proceeding.” Counsel for the Champagnes did not challenge the
hourly rate of the Whitbecks’ attorneys, but argued in its memorandum, without
any documentation, that the Whitbecks’ attorneys should have only spent half as
much time on the case as claimed.
In response, at oral argument, counsel for the Whitbecks asked that the
Champagnes’ attorneys submit their bills in-camera and thus allow the trial court
to compare the attorney fees for both parties to see if the Whitbecks’ attorneys
should have only spent fifty hours on the case. The trial court then allowed the
attorneys for the Champagnes ten days to provide the court with “a detailed
accounting of their attorney fees in this matter,” for an in-camera inspection.
After the requested submission from counsel for the Champagnes, the trial
court issued a ruling on September 30, 2013. The Champagnes’ attorney fees
accounting is not in the record before us and cannot be considered, as provided in
La.Code Civ.P. art. 2164. The trial court stated as its basis for reducing by almost
half the attorney fees requested by the Whitbecks, “After review of the attorney
fees requested and incurred by the parties in this case and the jurisprudence on
reasonable attorney fees, the Court will award $17,700 as a reasonable attorney fee
to the plaintiffs; expenses incurred by the plaintiffs in the amount of $2,764.35.”
20 In Covington v. McNeese State Univ., 12-2182, p. 6 (La. 5/7/13), 118 So.3d
343, 348, the supreme court held, “The appellate court reviews an award of
attorney’s fees for an abuse of discretion. The district court’s factual
determinations will not be set aside absent manifest error. Stobart v. State, Dep’t
of Trans. and Dev., 617 So.2d 880, 882 n. 2 (La.1993).”
The supreme court in State, Department of Transportation and Development
v. Williamson, 597 So.2d 439, 441-42 (La.1992), outlined the factors that must be
considered by a court in reviewing an award of attorney fees:
Factors to be taken into consideration in determining the reasonableness of attorney fees include: (1) the ultimate result obtained; (2) the responsibility incurred; (3) the importance of the litigation; (4) amount of money involved; (5) extent and character of the work performed; (6) legal knowledge, attainment, and skill of the attorneys; (7) number of appearances made; (8) intricacies of the facts involved; (9) diligence and skill of counsel; and (10) the court’s own knowledge.
The trial court was in the best position to determine the fairness of the award
of attorney fees. After reviewing the Champagnes’ documentation, which is not in
the record before us, the trial court exercised its much discretion and awarded
attorney fees of $17,700.00 to the Whitbecks. We cannot say that the amount so
awarded was an abuse of the trial court’s discretion.
Broker Fees
The Purchase Agreement states, “The BUYER may also be liable for Broker
fees.” The Whitbecks seek $26,000.00 in broker/realtor fees based on the sale
price of the Big Lake home in the Purchase Agreement, the delay occasioned by
the Champagnes’ breach of the terms of the Purchase Agreement, and the necessity
of filing this litigation.
21 The trial court declined to award broker’s fees and stated in its ruling
“Finally, I will deny the plaintiffs’ request for broker fees in this matter.” The
Purchase Agreement, which controls, allows the trial court the discretion to award
broker’s fees. We cannot say that the trial court abused its considerable discretion.
Attorney Fees on Appeal
The Champagnes argue that the Whitbecks are not entitled to attorney fees
for work on the appeal. However, this circuit specifically held in McFadden v.
Import One, Inc., 10-952, p. 16 (La.App. 3 Cir. 2/9/11), 56 So.3d 1212, 1223:
When an award for attorney’s fees is granted at a lower court level, the recipient of those fees is entitled to additional fees for work done on appeal. This keeps the appellate judgment consistent with the underlying judgment. Wilczewski v. Brookshire Grocery Store, 08– 718, p. 18 (La.App. 3 Cir. 1/28/09), 2 So.3d 1214, 1226, writ denied, 09–456 (La.4/13/09), 5 So.3d 170.
Based on the work performed by counsel for the Whitbecks on appeal, we
find that $2,500.00 is a reasonable award. We therefore grant the request of the
Whitbecks for attorney fees on appeal and award attorney fees in the amount of
$2,500.00, plus all costs of the appeal.
CONCLUSION
For the foregoing reasons, we affirm the trial court’s judgment in favor of
Peter and Marissa Whitbeck and against Robert and Charlet Champagne. We find
the Champagnes in breach of the June 30, 2012 Purchase Agreement and order the
Champagnes to specifically perform by paying $450,000.00 in cash under the
terms and provisions of the Purchase Agreement. We affirm the trial court’s
judgment allowing the Whitbecks to retain the $2,500.00 deposit, without an offset
against the sales price, all with legal interest from the date of judgment, plus the
award of costs to the Whitbecks in the amount of $2,764.35. We affirm the trial
22 court’s award of $17,700.00 in attorney fees and we award the Whitbecks
$2,500.00 as attorney fees for work on the appeal. We assess all costs of this
appeal to Robert and Charlet Champagne.