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Valentino v. Heart and Vascular Associates of Acadiana, P.C.

Court of Appeals of Louisiana, Third Circuit

May 17, 2017

VERNON A. VALENTINO, M.D.
v.
HEART AND VASCULAR ASSOCIATES OF ACADIANA, P.C.

         APPEAL FROM THE FIFTEENTH JUDICIAL DISTRICT COURT PARISH OF LAFAYETTE, NO. 2015-6019 HONORABLE MARILYN CARR CASTLE, DISTRICT JUDGE.

          Alan K. Breaud Thimothy W. Basden Breaud & Meyers COUNSEL FOR PLAINTIFF/APPELLANT: Vernon A. Valentino, M.D.

          Camille Bienvenu Poché, Karen T. Bordelon, Babineaux, Poché, Anthony & Slavich, L.L.C., COUNSEL FOR DEFENDANT/APPELLEE: Heart and Vascular Associates of Acadiana, P.C.

          Jeff Horn, Jr., Ohashi & Horn, LLP COUNSEL FOR DEFENDANT/APPELLEE: Heart and Vascular Associates of Acadiana, P.C.

          Court composed of Shannon J. Gremillion, John E. Conery, and David E. Chatelain, [*] Judges.

          JOHN E. CONERY JUDGE.

         Dr. Vernon A. Valentino (Dr. Valentino) appeals a partial judgment in his favor based on an employment contract against Heart and Vascular Associates of Acadiana, P.C. (HAVAA) wherein the trial court awarded him $30, 856.91, which included $22, 405.26 as a bonus for 2014 and $8, 451.65 for reimbursement of expenses incurred in 2015, plus judicial interest from December 3, 2015. The trial court denied Dr. Valentino's claim for $132, 727.22 in past due wages as well as penalty wages pursuant to La.R.S. 23:631-632. The trial court awarded Dr. Valentino, $15, 553.29 in attorney fees and litigation expenses, but denied the remaining portion of the $42, 332.28 of attorney fees and litigation expenses requested by Dr. Valentino. In his appeal, Dr. Valentino seeks full past due wage reimbursement based on his employment contract with HAVAA, penalty wages, the full amount of attorney fees and litigation expenses for trial, and additional attorney fees for work done on appeal. HAVAA did not appeal the dismissal of its reconventional demand or answer the appeal as to any portion of the trial court's judgment in favor of Dr. Valentino. For the following reasons, we reverse in part, affirm in part, and render.

         FACTS AND PROCEDURAL BACKGROUND

         Dr. Valentino is board certified both as a cardiologist and an interventional cardiologist. He has practiced medicine in the Lafayette, Louisiana area since 1991. Until 2014, Dr. Valentino was a partner in the Lafayette Heart Clinic (LHC) along with Dr. David Baker, the senior physician of the group, and Dr. Chris Mallavarapu. Dr. Brent Rochon was an employee of LHC. In 2013, Dr. Baker announced his retirement, and Dr. Mallavarapu moved his practice to upstate New York. These actions left Dr. Valentino as the only remaining partner in LHC, with Dr. Rochon as the only employee.

         Dr. Kevin Courville is also an interventional cardiologist practicing in Lafayette, Louisiana, who was also a former partner in LHC. Dr. Courville left LHC in 2012 to form HAVAA and become one hundred percent owner. Due to the breakup at the end of 2013 of the partners in LHC, Dr. Valentino and Dr. Courville began discussions about Dr. Valentino joining HAVAA as a "profits-partner" with the goal of both physicians to eventually create what was termed as a "super-group" of cardiologists in Lafayette. Despite the lack of a specific agreement between the two former partners, Dr. Valentino brought his book of patients and staff to HAVAA and began a fulltime practice with HAVAA on January 13, 2014. Dr. Rochon also joined HAVAA in January 2014, but as he had only been an employee of LHC, his status was unclear from the beginning of his association with HAVAA.

         There was no formal or written agreement in place when Dr. Valentino began practicing at HAVAA on January 13, 2014. However, Dr. Courville allegedly told Dr. Valentino that his attorney in Dallas, Mr. Jeff Horn, was working on a contract to formalize an equal partnership agreement in HAVAA, with an eye toward forming the contemplated "super group" of cardiologists. The two doctors also verbally agreed that Dr. Valentino would take a $40, 000.00 draw each month, the same amount as his previous draw at LHC. In anticipation of the promised partnership, Dr. Valentino loaned HAVAA $30, 000.00 in March 2014 to assist with startup expenses and allegedly agreed to defer his draw for a short time until his billings through HAVAA could be realized.

         Despite his alleged assurances to Dr. Valentino that the partnership agreement was in the works, Dr. Courville's testimony at trial indicates that from the beginning, he did not instruct his attorney to prepare a partnership agreement that would make Dr. Valentino a partner in HAVAA. He admitted that instructions to Mr. Horn were to draft a physician's employment agreement (PEA), making Dr. Valentino a HAVAA employee, not an equal partner. Indeed, in the answer to Dr. Valentino's lawsuit, HAVAA admitted that Dr. Valentino was an employee.

         When no partnership agreement was forthcoming, Dr. Valentino requested the financial records for the term of his practice with HAVAA beginning January 13, 2014. Dr. Courville refused his request and indicated he would not divulge any financial information until the PEA was signed by Dr. Valentino. Dr. Valentino was first presented with the PEA in March 2014. Dr. Valentino signed the PEA in April 2014, with an effective date of January 1, 2014, and became an employee of HAVAA. Still, Dr. Valentino was never shown the requested financial information.

         The PEA guaranteed Dr. Valentino a salary of $480, 000.00 a year. He received his first check on May 5, 2014, for the two-week pay period following his signing of the PEA. Dr. Valentino immediately began seeking his past due wages retroactive to January 13, 2014 through April 18, 2014. Dr. Valentino admittedly began work with HAVAA on January 13, 2014. Though the PEA became effective on January 1, 2014, and does cover Dr. Valentino's entire tenure with HAVAA, he is only claiming past due wages from January 13, 2014. The PEA also provided that any bonus paid to Dr. Valentino was at the sole discretion of HAVAA, which is in direct conflict with their earlier verbal agreement. Dr. Valentino had no part in determining the bonus or access to the financial basis for determining a bonus under the terms of the PEA.

         The PEA was the only agreement written and signed between Dr. Valentino and HAVAA. It contained an "Entire Agreement" clause which provided that the PEA, "supersedes and merges all prior agreements and discussions between Physician and Employer."

         In mid-2014, a meeting was held between Dr. Courville, Dr. Valentino, and Dr. Rochon to discuss the status of HAVAA. Once again, Dr. Valentino and Dr. Courville discussed the issue of Dr. Valentino's past due wages which totaled over $140, 000.00 for January 13, 2014 through April 18, 2014. The details of the meeting will be thoroughly discussed in a subsequent portion of this opinion.

         On July 16, 2014, Dr. Valentino again requested by email that HAVAA pay his past due wages and again sought to be permitted to review the financial records of HAVAA for the second quarter of 2014. His request was again denied. On October 7, 2014, Dr. Valentino made another request by email seeking his past due wages, repayment of his $30, 000.00 loan made to HAVAA, the cost of supplies provided to the business, and a further request for HAVAA's financial records. Dr. Courville failed to respond to Dr. Valentino's October 7, 2014 email.

         Dr. Valentino resigned from HAVAA on July 27, 2015, via a letter of resignation delivered to Dr. Courville. In his resignation letter, Dr. Valentino made yet another demand for his past due wages. Dr. Valentino testified at trial that he never received a written response to his demands, only that Dr. Courville stated that he would speak with his attorney about the issue. No further response was forthcoming from Dr. Courville or his attorney.

         When no response to his demand for past due wages and other expenses allegedly owed was received from Dr. Courville, Dr. Valentino engaged counsel, who made a formal written demand on his behalf to HAVAA for his past due wages from January 13, 2014 through April 18, 2014, along with other expenses and benefits which are not included in Dr. Valentino's claim on appeal. HAVAA failed to respond to Dr. Valentino's attorney's demand letter. On December 3, 2015, Dr. Valentino filed this petition entitled, "PETITION FOR UNPAID WAGES, BENEFITS, AND REIMBURSABLE EXPENSES AND FOR PENALTY WAGES AND ATTORNEY FEES[.]"

         HAVAA answered Dr. Valentino's petition and admitted that Dr. Valentino began his employment at HAVAA on January 13, 2014, and was first paid wages on May 5, 2014. HAVAA also admitted that HAVAA had received a demand for past due wages from Dr. Valentino as well as his counsel's formal demand for the past due wages dated September 24, 2015. HAVAA responded to the petition with a number of defenses. For the first time, in its reconventional demand, HAVAA claimed that Dr. Valentino had breached the terms of the PEA by working at Abbeville General Hospital while he was an employee of HAVAA.

         The summary proceeding allowed in a wage dispute pursuant to La.R.S. 23:631 began on March 18, 2016. After testimony began, the trial court determined the case could not be completely resolved in a summary proceeding and reset the case for trial on the merits as an expedited ordinary proceeding on June 22, 2016. At the beginning of the trial, the trial court without objection ordered that all testimony and evidence introduced at the March 18, 2016 trial would be considered a part of the trial record. Both Dr. Valentino and Dr. Courville testified live at the trial on the merits.

         At the close of trial, the matter was taken under advisement by the trial court, who then issued written reasons in a ruling dated July 7, 2016. A judgment in accordance with the trial court's ruling was signed by the trial court on August 30, 2016. Dr. Valentino timely filed this appeal of the trial court's denial of his full past due wages, penalty wages, and failure to award the full amount of attorney fees and litigation expenses, and requested additional attorney fees for work done on appeal. HAVAA did not answer the appeal or file a separate appeal of the denial of its reconventional demand.

         ASSIGNMENTS OF ERROR

         Dr. Valentino asserts the following assignments of error on appeal:

1. The trial court erred in failing to award Dr. Valentino the wages owed to him by HAVAA under the Physician Employment Agreement for the work actually performed between January 13, 2014 and April 18, 2014.
2. The trial court erred in finding that Dr. Valentino agreed to work for free between January 13, 2014 and April 18, 2014.
3. The trial court erred in denying Dr. Valentino's claim for penalty wages under La. R.S. 23:632.
4. The trial court erred in refusing to award Dr. Valentino all of the attorney fees and litigation expenses which he incurred in the litigation of his claim for unpaid wages.

         LAW AND DISCUSSION

         Standard of Review

         In Hayes Fund for First United Methodist Church of Welsh, LLC v. Kerr-McGee Rocky Mountain, LLC, 14-2592, p. 8 (La. 12/8/15), 193 So.3d 1110, 1115-16, the supreme court reiterated the duty of appellate courts in a manifest error review and stated in pertinent part:

In all civil cases, the appropriate standard for appellate review of factual determinations is the manifest error-clearly wrong standard, which precludes the setting aside of a trial court's finding of fact unless that finding is clearly wrong in light of the record reviewed in its entirety. Cenac v. Public Access Water Rights Ass 'n, 02-2660, p. 9 (La. 6/27/03), 851 So.2d 1006, 1023. Thus, a reviewing court may not merely decide if it would have found the facts of the case differently. Hall v. Folger Coffee Co., 03-1734, p. 9 (La. 4/14/04), 874 So.2d 90, 98. Rather in reversing a trial court's factual conclusions with regard to causation, the appellate court must satisfy a two-step process based on the record as a whole: there must be no reasonable factual basis for the trial court's conclusion, and the finding must be clearly wrong. Stobart v. State through Dept. of Transp. and Development, 617 So.2d 880, 882 (La.1993).
This test requires a reviewing court to do more than simply review the record for some evidence, which supports or controverts the trial court's findings. The court must review the entire record to determine whether the trial court's finding was clearly wrong or manifestly erroneous. Parish Nat. Bank v. Ott, 02-1562, pp. 7-8 (La. 2/25/03), 841 So.2d 749, 753-54. The issue to be resolved on review is not whether the judge or jury was right or wrong, but whether the judge's or jury's factfinding conclusion was a reasonable one. Rosell v. ESCO, 549 So.2d 840, 844 (La.1989); Canter v. Koehring Co., 283 So.2d 716, 724 (La.1973).

         Errors of law, however, are reviewed de novo. Foti v. Holliday, 09-93 (La. 10/30/09), 27 So.3d 813. Accordingly, when reviewing an issue of law, we "render[ ] judgment based on the record without deference to the legal conclusions of the lower courts." Id. at 817

         Assignment of Errors One and Two - The Physician Employment Agreement-Past Wages From January 13, 2014 -April 18, 2014

         Dr. Valentino filed suit for payment of his past due wages pursuant to La.R.S. 23:631 which states, in pertinent part:

A. (1)(b) Upon the resignation of any laborer or other employee of any kind whatever, it shall be the duty of the person employing such laborer or other employee to pay the amount then due under the terms of employment, whether the employment is by the hour, day, week, or month, on or before the next regular payday for the pay cycle during which the employee was working at the time of separation or no later than fifteen days following the date of resignation, whichever occurs first.
B. In the event of a dispute as to the amount due under this Section, the employer shall pay the undisputed portion of the amount due as provided for in Subsection A of this Section. The employee shall have the right to file an action to enforce such a wage claim and proceed pursuant to Code of Civil Procedure Article 2592.[1]

         HAVAA argues that Dr. Valentino was not entitled to payment of past wages under the terms of the PEA for the period from January 13, 2014 to April 18, 2014, because he verbally agreed to waive these initial past wages in discussions with Dr. Courville when it was contemplated that a partnership between the two physicians and the eventual formation of a "super group" of cardiologists was the goal.

         The trial court in its ruling found that despite the express terms of the written PEA, "the weight of the evidence establishes that the compensation for the initial period when no draws or salary were received was to be based upon the profitability of the physician and compensated in the form of bonuses[.]" The trial court calculated the amount for bonuses in 2014 to be $22, 405.26 plus $8, 451.65 for unreimbursed expenses. The trial court gave no explanation for the calculation and awarded those sums to Dr. Valentino, plus interest. No appeal ...


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