Royal Oldsmobile Co. v. Heisler Properties, L.L.C.

58 So. 3d 483, 2010 La. App. LEXIS 1796, 2010 WL 5373913
CourtLouisiana Court of Appeal
DecidedDecember 28, 2010
DocketNo. 10-CA-152
StatusPublished
Cited by5 cases

This text of 58 So. 3d 483 (Royal Oldsmobile Co. v. Heisler Properties, L.L.C.) 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
Royal Oldsmobile Co. v. Heisler Properties, L.L.C., 58 So. 3d 483, 2010 La. App. LEXIS 1796, 2010 WL 5373913 (La. Ct. App. 2010).

Opinion

FREDERICKA HOMBERG WICKER, Judge.

13This appeal concerns a dispute over contested provisions in a lease agreement — the right of first refusal to purchase the leased property and the exercise of lease renewal options. The original 1977 lease provided for renewal options. It is undisputed that the original lease was recorded but the exercises of renewal options were not. The plaintiff, Royal Oldsmobile Company, Inc. (Royal), originally leased the property from two brothers; Frank P. Dimitri and Joseph Dimitri. After their deaths, the ownership changed. Now, Royal seeks specific performance requiring the current owners to sell their respective one-half undivided interests to Royal in accordance with the alleged lease provisions. Alternatively, Royal asks that all sales that occurred in violation of its right be rescinded and that the defendants/parties who acquired ownership following the brothers’ deaths be ordered to sell their interests in the property to Royal. Royal sued the Dimitri defendants,1 the Succession of Garrett defendants,2 and [485]*485Heisler Properties, LLC (Heisler). Royal additionally seeks rental reimbursement or 14damages for amounts it paid based on its contention that those amounts are null and void given the violation of its right of first refusal.

The partial summary judgments on appeal arise from cross-motions for summary judgment filed by Royal and one of the current buyers, the Succession of Garrett defendants, which the trial judge granted in part in one judgment. She denied Royal’s motion for summary judgment as to the Succession of Garrett defendants and she granted the Succession of Garrett defendants’ cross-motion for summary judgment. As to the Succession of Garrett defendants, she concluded that the right was not triggered by an involuntary U.S. Marshal’s bankruptcy sale through which the Succession of Garrett acquired the property. Regarding Royal’s motion for summary judgment against Heisler, the trial judge granted the motion, finding that Heisler was aware that Royal leased the property at the time of the sale and, relying on La.C.C. art. 3389,3 she found that the recordation of the exercise of lease renewal options was not necessary for the lease to continue to affect third parties such as Heisler. She rendered judgment finding that Royal was entitled to specific performance of its right to first refusal with respect to the leased property acquired by Heisler. Royal and Heisler appeal. The trial judge only decided two theories of the case; namely, that the right of first refusal was not barred by Royal’s failure to record the exercise of renewal options and the right was not triggered by an involuntary U.S. Marshal’s bankruptcy sale. For the foregoing reasons, we vacate in part the certification of appealability issued by the trial [ .judge; dismiss without prejudice in part; affirm in part; and remand for further proceedings.

Procedural History and Underlying Facts

Frank P. Dimitri and Joseph Dimitri were the original co-owners with one-half undivided interests in the leased property located in Jefferson Parish bounded by Severn Avenue, Veterans Boulevard, 27th Street and North Hullen Street. The brothers leased the property to Royal on June 29, 1977. It is undisputed that the original lease was recorded. Paragraph 19 of the lease contained the following right of first refusal:

RIGHT OF FIRST REFUSAL. In the event that the Lessor has a bona fide offer in writing and desires to sell all or any part of the leased premises, the Lessee shall have the right of first refusal, for a period of thirty (30) days following delivery of a copy of the offer to its offices, to purchase the property for such amounts and upon such terms as the Lessor has an opportunity to sell such property to a third person. Provided, however, the right of first refusal provided for in this paragraph shall not apply to sales or transfers from the [486]*486present owner to trusts for the benefit or members of the families of such owner, or to corporations, the majority of the voting stock of which is owned by the present owner or members of his family; however, such right of first refusal shall be binding on such transferees in the event the transferees desire to sell all or part of the leased premises, and Lessor agrees that a clause to that effect shall be set forth in any act of transfer of the property to any trust or corporations as set forth above.

The lease provided for successive options to renew as follows:

The original term was 60 months, commencing on October 1, 1977 and expiring September 30, 1982. It provided that the lessee shall have the option to renew the lease for two consecutive five-year periods and an additional seven-year period and another additional period of seven years, two months upon the same terms and conditions contained in the lease, with the exception of the monthly rental rate, which shall increase as further provided. It stated that if the lessee decided to exercise the option, the lessee shall notify the lessor in writing of the exercise of its option at least 120 days prior to the end of the primary term or, any | (¡extension thereof. If written notice is not given, the lessor shall notify the lessee in writing that it is time to exercise the lessee’s option. If said written notice from the lessee was not given within 10 days of the lessor’s notice, the option shall automatically expire the lease. It stated that it was understood and agreed that the renewal option contemplated four renewal options with the first being exercised at least 120 days pri- or to the end of the first five-year extension (September 30, 1987). The expiration date of the final option period was November 30, 2006.4

Frank Dimitri and Joseph Dimitri died in 1993 and 2003, respectively. Thereafter, subsequent transfers of the leased property resulted in the Succession of Garrett’s ownership of Frank’s undivided interest and Heisler’s ownership of Joseph’s undivided interest. The Succession of Garrett and Heisler each acquired an undivided one-half interest in the property on October 14, 2003 and December 11, 2003 respectively.5

After Frank died in 1993, his wife, Josephine Desalvo Dimitri, was recognized as the sole heir and placed in possession of all of Frank’s assets on June 26, 2000. Pursuant to bankruptcy proceedings in the United States Eastern District of Louisiana, in the bankruptcy case entitled “In re Josephine Dimitri,” consolidated with “Jo[487]*487sephine D. Dimitri v. Granville Semmes, et. als,” the bankruptcy court seized property belonging to the debtor, Josephine D. Dimitri, on June 24, 2003. The property included Frank’s undivided interest in the leased |7property. The seized property, along with other property, was sold on October 14, 2003 by the United States Marshal for the Eastern District of Louisiana to the highest bidder — Succession of William C. Garrett.

After Joseph died on June 19, 2003, his widow, Josephine Virga Dimitri, and the Succession of Joseph Dimitri entered into a cash sale of property on December 11, 2003. They sold, among other pieces of property, Joseph’s undivided half interest in the leased property to Josephine Desal-vo Dimitri. On the same day, December 11, 2003, Josephine Desalvo Dimitri sold, among other pieces of property, the subject property to Heisler.

The Motions for Summary Judgment The 2006 Motions

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Pecora v. Berlin
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Cite This Page — Counsel Stack

Bluebook (online)
58 So. 3d 483, 2010 La. App. LEXIS 1796, 2010 WL 5373913, Counsel Stack Legal Research, https://law.counselstack.com/opinion/royal-oldsmobile-co-v-heisler-properties-llc-lactapp-2010.