Sabine State Bank & Trust Co. v. Louisiana Department of Social Services

117 So. 3d 1283, 2013 WL 3197440, 2013 La. App. LEXIS 1308
CourtLouisiana Court of Appeal
DecidedJune 26, 2013
DocketNo. 48,259-CA
StatusPublished

This text of 117 So. 3d 1283 (Sabine State Bank & Trust Co. v. Louisiana Department of Social Services) 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
Sabine State Bank & Trust Co. v. Louisiana Department of Social Services, 117 So. 3d 1283, 2013 WL 3197440, 2013 La. App. LEXIS 1308 (La. Ct. App. 2013).

Opinion

BROWN, Chief Judge.

hThe critical issue to be resolved in this concursus proceeding against a state agency is whether it was sufficient to serve only the attorney general or whether it was necessary to also serve the head of the state agency. For reasons that follow, we find that the service of citation on only the attorney general was sufficient for purposes of La. R.S. 13:5107. Consequently, we find that the trial court’s judgment that denied the state agency’s exception of insufficiency of service of process was correct.

We further find that the evidence presented to the trial court clearly supports the conclusion that Frances M. Pesnell was the sole owner of the certificate of deposit held by Sabine Bank.

Facts and Procedural Background

The facts giving rise to this case are not in dispute. The State of Texas requested that the State of Louisiana intercept assets belonging to Billy McElduff, Jr. (“McEl-duff’), to satisfy delinquent child support payments. The amount of arrears owed was $26,983.37. The Sabine State Bank and Trust Company (“Sabine Bank”) received from the Louisiana Department of Children and Family Services, Support Enforcement Services (“DCFS-CSE”) a Notice to Freeze the assets of McElduff. Sabine Bank had a certificate of deposit in the amount of $75,484.74 in the names of Frances M. Pesnell, Tracy N. McElduff, Susan K. Barmore and Billy McElduff, Jr., all residents of Lincoln Parish.

Sabine Bank filed a petition for concur-sus in the Third Judicial District Court in Lincoln Parish, Louisiana, naming as defendants the four parties listed on the certificate of deposit and the DCFS-CSE.

| i>Sabine Bank’s petition was filed on October 19, 2011. The DCFS-CSE was served through the Louisiana Secretary of [1285]*1285State and the Office of the Louisiana Attorney General on November 15, 2011. On January 20, 2012, Ms. Pesnell filed a motion and order to limit the time in which DCFS-CSE had to file an answer pursuant to La. C.C.P. art 4657.1 An order was signed on January 23, 2012, which granted DCFS-CSE ten days from date of service of the motion to file an answer. Service of the motion and order was made upon DCFS-CSE through the secretary of state on February 1, 2012, and the attorney general on February 2, 2012.

On March 1, 2012, DCFS-CSE filed a motion requesting an extension of time to file an answer. The court granted an extension until March 22, 2012. DCFS-CSE then filed an exception of insufficiency of service of process on March 12, 2012 (fax filed on March 8, 2012). Also, on this date, Ms. Pesnell filed a motion to vacate DCFS-CSE’s motion for extension of time to answer. Both parties were required to brief the motion and exception at a hearing held on March 12, 2012. On April 9, 2012, the court issued a ruling denying DCFS-CSE’s exception and vacating the motion for extension of time. Even so, DCFS-CSE filed an answer in this proceeding |Hon April 19, 2012. Ms. Pesnell filed a motion to vacate and expunge DCFS-CSE’s answer which was granted on May 17, 2012.

A hearing was held on July 9, 2012. DCFS-CSE waived its appearance at the hearing by letter from its counsel. Ms. Pesnell, Barmore and Lunsford, all of whom were listed as holders on the certificate of deposit, testified. Barmore and Lunsford testified that they were listed for administrative purposes and had no authority to claim the money. Lunsford testified that Billy McElduff, Jr., Ms. Pes-nell’s son who was in prison at this time, verbally admitted having no claim to the money. Ms. Pesnell testified that the certificate of deposit with Sabine Bank was purchased entirely with a royalty check made payable to her that she had received from her deceased husband’s estate. She further testified that she was the beneficiary of all interest income from the certificate of deposit and the income was reported on her tax return. Ms. Pesnell’s address was the only one listed on the certificate of deposit.

Judgment was rendered finding that the CD was the sole property of Ms. Pesnell and ordering Sabine Bank to cancel the notice to freeze, intercept, and/or encumber assets. DCFS-CSE was ordered to pay all costs of the proceeding totaling approximately $2,338.40. The court further ruled that Ms. Pesnell was to have full and uncontrolled discretion to access the funds from in the certificate of deposit. Following the judgment, Ms. Pesnell withdrew all funds from the certificate of deposit.

DCFS-CSE filed a motion for suspen-sive appeal.2

[1286]*1286| ^Discussion

This court must determine whether the trial court erred in finding that Sabine Bank perfected proper service of process by serving the original petition and order to DCFS-CSE to answer on the áttorney general. La. R.S. 13:5107(A)(1), provides:

In all suits filed against the state of Louisiana or a state agency, citation and service may be obtained by citation and service on the attorney general of Louisiana ... and on the department, board, commission, or agency head or person, depending upon the identity of the named defendant and in accordance with the laws of this state, and on the department, board, commission, or agency head or person, depending upon the identity of the named defendant and the identity of the named board, commission, department, agency, or officer through which or through whom suit is to be filed against. (Emphasis added).

The Louisiana State Supreme Court has interpreted La. R.S. 13:5107(A)(l)in two recent decisions. In Whitley v. State Bd. of Supervisors of Louisiana State University Agricultural and Mechanical College, 11-0040 (La.07/01/11), 66 So.3d 470, a medical malpractice suit against Louisiana’s Medical Center (“University”) in New Orleans where service was made solely on the Chairman of the LSU Board of Supervisors, the supreme court wrote:

The use of the word “may” followed by the use of the words “or” and “and” in numerous instances throughout the statute makes this provision convoluted and confusing ...
Key to our interpretation of this statutory provision is the fact that LSA-R.S. 13:5107(A) contains a single verb phrase, that is, “may be obtained,” which modifies all of the phrases that follow it, including | F,those that appear after the conjunctive “and” in question. Therefore, from a grammatical standpoint, citation and service:
1. may be obtained by citation and service on the attorney general of Louisiana, or on any employee in his office above the age of sixteen years, or any other proper officer or person, depending upon the identity of the named defendant and in accordance with the laws of this state, and
2. may be obtained by citation and service on the department, board, commission, or agency head or person, depending upon the identity of the named defendant and in accordance with the laws of this state, and
3. may be obtained by citation and service on the department, board, commission, or agency head or person, depending upon the identity of the named defendant and the identity of the named board, commission, department, agency, or officer through which or through whom suit is to be filed against.
Providing permission to request service on the AG and the head of the agency does not impose a requirement that the plaintiffs request for service pertain to both.

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117 So. 3d 1283, 2013 WL 3197440, 2013 La. App. LEXIS 1308, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sabine-state-bank-trust-co-v-louisiana-department-of-social-services-lactapp-2013.