Sadler v. Midboe

723 So. 2d 1076, 1998 WL 917340
CourtLouisiana Court of Appeal
DecidedDecember 28, 1998
Docket97 CA 2120
StatusPublished
Cited by9 cases

This text of 723 So. 2d 1076 (Sadler v. Midboe) 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
Sadler v. Midboe, 723 So. 2d 1076, 1998 WL 917340 (La. Ct. App. 1998).

Opinion

723 So.2d 1076 (1998)

Frank O. SADLER and Janice L. Sadler
v.
Kai D. MIDBOE, et al.

No. 97 CA 2120.

Court of Appeal of Louisiana, First Circuit.

December 28, 1998.

*1077 John David Ziober, Baton Rouge, for Plaintiffs-Appellants Frank O. Sadler and Janice L. Sadler.

Michael P. Smith, Baton Rouge, for State of Louisiana.

Before: FOGG, PARRO, FITZSIMMONS, GUIDRY, JJ., and CHIASSON,[1] J. Pro Tem.

REMY CHIASSON, Judge Pro Tem.

Plaintiffs, Frank and Janice Sadler, appeal from a judgment of the trial court, granting a peremptory exception pleading the objection of prescription urged by the Louisiana Department of Environmental Quality (LDEQ)

FACTS AND PROCEDURAL HISTORY

Cracker Barrel Stores, Inc. (CBSI) operated Cracker Barrel No. 27, a convenience store which also sells gasoline. This store is located in New Roads, Louisiana on the corner of Louisiana Highway 1 and Louisiana Highway 78, directly across from a residence *1078 owned by Frank and Janice Sadler, located on Hwy. 1. Frank Sadler is also the president, a director, and the owner of 50% of the common stock in CBSI.

In December of 1988, a leak occurred in the product delivery lines leading to the underground storage tanks at the store. The leak was discovered by Frank Sadler in January of 1989. The leak migrated under La. Hwy. 1 to the Sadlers' residence located on False River. The release was confirmed by LDEQ on February 8, 1989.

The LDEQ administers the Motor Fuels Underground Storage Tank Trust Fund (the "Tank Trust Fund") which allows the reimbursement from the Tank Trust Fund to eligible underground storage tank owners of costs incurred in the cleanup of groundwater and subsurface soils caused by the leakage from these tanks.

CBSI hired Westinghouse Environmental and Geotechnical Services (Westinghouse) from an emergency response contractor list provided by the LDEQ to perform remediation of the underground leak. On or about February 22, 1989, the product lines which had caused the release were completely replaced. Thereafter, Westinghouse used the Sadlers' property to perform remediation pursuant to a plan of remediation submitted by CBSI and Westinghouse to the LDEQ, who approved the plan. The use of the property included the installation of a treatment system and the placement of equipment on the property.

On July 10, 1991, the LDEQ received a request from Westinghouse to discontinue remediation activities. In response to this request, in a letter directed to Frank Sadler, the LDEQ advised CBSI of the need for further sampling and the possibility of other corrective action before remediation activities could be discontinued. No further remediation was performed and the equipment was removed in December of 1991.

Pursuant to the provisions of the Tank Trust Fund, CBSI submitted three reimbursement applications to the LDEQ for cleanup costs incurred by Westinghouse. The first two payments from the Tank Trust Fund were made on March 22, 1990, in the amount of $98,748.00 and on February 14, 1991, in the amount of $39,405.05. The third reimbursement application of CBSI, submitted on April 6, 1992, requested a total of $150,123.00. Included in the amount requested was an invoice dated January 10, 1992, from the Sadlers to Westinghouse for use of the Sadler residence for remediation purposes from early 1989 through December, 1991. The amount requested was $64,680.00.

In a letter dated September 28, 1992, the LDEQ remitted a payment to CBSI in the amount of $82,897.75. The enclosed report explained that "$67,251.66 was not allowed because of missing support data, excessive costs, items claimed in duplicate, and property rental and freight charges are not reimbursable."

On September 23, 1993, Frank and Janice Sadler filed a petition for damages against CBSI and Kai Midboe, Secretary of the LDEQ, as the representative of the Tank Trust Fund domiciled in the Parish of East Baton Rouge. The Sadlers alleged that their residence had been damaged as a result of the leakage of gasoline from the underground motor fuel storage tanks. The Sadlers requested a reasonable fee for equipment storage on their property and for the time the residence was unmarketable due to the remediation activities undertaken and the use of the property for placement of the cleanup equipment. The Sadlers also claimed a loss of value of the property as a result of the contamination of the soil, interest paid by them on the property's mortgage since the cancellation of a $210,000.00 purchase agreement on the property after the discovery of the leak; and any other loss or damage which may become apparent prior to trial of this matter.

Thereafter, LDEQ filed an answer to the petition. This answer was subsequently amended.

CBSI also attempted to answer the petition, contending that at all times, it was in substantial compliance with, and an eligible participant in, the Tank Trust Fund. Thus, the Tank Trust Fund was obligated to indemnify CBSI for any and all claims by any and all third parties, including the Sadlers. *1079 The answer was signed by Janice Chiasson, Secretary-Treasurer of CBSI. The record reflects that Ms. Chiasson is not an attorney. We note here that a corporation, as a fictional legal person, can only be represented by licensed counsel. Plaquemines Parish Commission Council v. Delta Development Company, Inc., 502 So.2d 1034, 1059 (La.1987).

On December 29, 1994, the Sadlers filed a motion for partial summary judgment, alleging that they were entitled to a judgment on the face of the pleadings against the LDEQ, declaring it liable, jointly, severally and in solido with CBSI and declaring that the LDEQ must indemnify CBSI for all losses sustained by the Sadlers. This motion was denied by the trial court on February 17, 1995.

On January 30, 1995, the LDEQ filed a second supplemental and amending answer.

On February 10, 1995, the LDEQ filed a peremptory exception pleading the objections of prescription and no cause of action. The LDEQ alleged that the Sadlers' petition, on its face, alleged that the cause of action occurred more than one year prior to the commencement of this action and was prescribed by the prescription of one year. The LDEQ further alleged that the Sadlers had failed to state a cause of action for the rental charges.

On April 20, 1995, the Sadlers filed a renewed motion for partial summary judgment based on the trial court's reasons for denying their first motion. Attached to the memorandum in support of their motion for partial summary judgment was an unexecuted copy of a document entitled "Consent Judgment As To Liability Only," which purported to grant partial summary judgment in favor of the Sadlers, finding CBSI liable for any and all damages.

The Sadlers also filed a memorandum in opposition to the exceptions filed by the LDEQ and attached to the memorandum was a "Renunciation of Prescription and Continuing Acknowledgment of Liability," which was executed by CBSI on September 20, 1993.

The LDEQ again amended their answer to allege that CBSI was nothing more than a thinly veiled and undercapitalized corporate entity, representing nothing more than the alter ego of Frank Sadler.

After a hearing was held on September 8, 1995, the trial court issued a judgment on March 14, 1996, granting the LDEQ's exception of prescription.

On March 22, 1996, the Sadlers filed a motion for new trial. The trial court subsequently vacated its previous judgment and granted a new trial on April 24, 1996.

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Bluebook (online)
723 So. 2d 1076, 1998 WL 917340, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sadler-v-midboe-lactapp-1998.