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Blake v. Blake

Court of Appeals of Louisiana, Fourth Circuit

September 20, 2017


         APPEAL FROM 25TH JDC, PARISH OF PLAQUEMINES NO. 52-267 C\W 52-279, 52-942, DIVISION "A" Honorable Kevin D. Conner, Judge

          Michael Robert Carson Riess KINGSMILL RIESS, L.L.C. Phillip A. Wittmann Dorothy H. Wimberly Brooke C. Tigchelaar STONE PIGMAN WALTHER WITTMANN, LLC, David M. Hufft Timothy Thriffiley PIVACH PIVACH HUFFT THRIFFILEY & DUNBAR, L.L.C. COUNSEL FOR PLAINTIFF/APPELLANT


          Court composed of Chief Judge James F. McKay, III, Judge Edwin A. Lombard, Judge Daniel L. Dysart

          Edwin A. Lombard, Judge

          Before the court in these consolidated cases are the cross-appeals of Michael Edward Blake ("Mr. Blake") and Alicia Victoria DiMarco Blake ("Ms. DiMarco").[1] After review of the record in light of the applicable law and arguments of the parties, we find Ms. DiMarco's nullity action was untimely filed, reverse the district court judgment of October 31, 2011, and vacate the district court judgment of June 2, 2016.

         Relevant Facts and Procedural History

         The parties were married on November 14, 2003. On March 8, 2005, Mr. Blake filed a petition for divorce. On March 10, 2005, Ms. DiMarco filed a petition for divorce.[2] Pursuant to a consent judgment signed on October 27, 2005, the community property regime was terminated with an effective date of March 8, 2005. The parties were divorced on November 21, 2005, reserving the community property partition issue to be decided at a later date.

          There were two major assets at issue in the community property partition: (1) the matrimonial domicile in Belle Chasse, Louisiana, purchased by Mr. Blake with separate funds but placed jointly in his name and Ms. DiMarco's on the act of sale and property deed[3] and an oil rig ("the Blake 505") purchased after the termination of the community by a business entity organized and registered by Mr. Blake during the marriage. Specifically, Mr. Blake (whose career in oil related businesses is apparently quite financially rewarding) registered Blake Offshore Drilling Company, LLC ("Blake Offshore Drilling") with the Louisiana Secretary of State on February 18, 2005, approximately fifteen months after marrying Ms. Blake and less than a month before the parties each filed for divorce. In April 2005, after the community property regime was terminated, Blake Offshore Drilling acquired its major asset, the oil rig subsequently named the Blake 505. Unlike Mr. Blake's other business interests, Blake Offshore Drilling (and the Blake 505) became subject to claims in the community partition because it was organized during the brief marriage.

         During the discovery and document exchange related to the community partition, the claim for Ms. DiMarco's half ownership of Mr. Blake's interest in Blake Offshore Drilling was communicated to Mr. Blake and, in response, a letter was sent to Ms. DiMarco requesting payment to Mr. Blake of half of the $874, 462.07 paid in "capital calls" by Mr. Blake on behalf of Blake Offshore Drilling as of January 2006. Shortly thereafter, on March 8, 2006, Mr. Blake (as managing member of Blake Offshore Drilling) filed a lawsuit against Ms. iMarco[4]alleging that, in light of Ms. DiMarco's claimed community property ownership interest in the company, the company's lack of income, and significant capital infusion requirements for ongoing operations, Ms. DiMarco was responsible for $437, 231.04 to Blake Offshore Drilling for her portion of the past capital contributions made by Mr. Blake through January 2006, as well as future payments of approximately $46, 250.00 per month for her portion of the monthly "capital calls."

         Our review of the record indicates that the Blake 505 was a primary focus during the discovery process and interchanges between the parties prior to the compromise agreement settling the community partition entered into by the parties:

(1) In a correspondence dated March 14, 2006, Ms. DiMarco's counsel, Robert Lowe, advised Mr. Blake's counsel: "Also, I want to have someone take a look at the rig that is owned by the entity, Blake Offshore Drilling Company, L.L.C. If you can tell me who our expert should contact concerning the rig, he can make his arrangements directly, as opposed to having it come through this office." On March 14, 2006, Mr. Lowe faxed a letter dated March 27, 2006, to Mr. Blake's counsel requesting confirmation of the deposition schedule, adding: Also I told you that I wanted an expert to go out and look at the rig. I need an answer. I do not want to have to file a Rule on this." A note on the cover sheet (dated March 14, 2006) indicated that Mr. Lowe "dictated this before we spoke today."
(2) By letter dated March 28, 2006, to Mr. Blake's counsel, Mr. Lowe stated: "I need the name of the rig that I previously corresponded with you about, and I also need to know where it is located. As advised, we want to view it."
(3) On April 11, 2006, in a letter related to Mr. Blake's Whitney Bank documents, Mr. Lowe confirmed Mr. Blake's upcoming deposition scheduled for April 25, 2006, and the trial date scheduled for May 30, 2006, advising Mr. Blake's counsel (emphasis added): "As we discussed with the Judge, I want to have an expert review the rig, which you claim was the "old Jedco." If there is something you want the expert to sign, such as the hold harmless you mention, get me a draft of it. The expert's name is Dave Sanderson." (emphasis added).

         At the deposition of Mr. Blake, wherein Mr. Blake's business and financial interests were discussed extensively, [5] the Blake 505 was a major point of questioning. Mr. Blake answers in response to specific questions related to the value and potential of Blake Offshore Drilling and its primary asset, the Blake 505, were equivocal, referencing the cost of the rig, the necessity and expense of refurbishing it (seventeen million dollars), the difficulties in selling the rig (because it was not designed to operate in the Gulf of Mexico and needed to be refurbished), and financing of the rig by Whitney Bank. It should be noted, however, that Mr. Blake's valuation of the rig was in the context of repeated assurances made by Ms. DiMarco's counsel to Mr. Blake's counsel, that as exemplified by the following colloquy, an independent maritime expert had been retained on behalf of Ms. DiMarco and that an independent appraisal was forthcoming:

MR. LOWE: David, I don't know what the Whitney has; but obviously on this thing, we're going to have to get the organizational documents, the capitalization documents, and that type of thing.
MR. HUFFT: My best advice is to subpoena them from Mike Riess [Mr. Blake's business counsel] and let him make a return on that subpoena.
MR. LOWE: Well, you got -
MR. HUFFT: I can call and ask him.
MR. LOWE: You got to tell him to just produce the stuff to us; because, to go through a lawyer, it's a little bit more difficult. So you are agreeing that he can produce all the documents whatever in reference to that company.
MR. HUFFT: That is fine. Because that is a - that technically has the community interest.
MR. LOWE: I'm not sure what it is or what it has, was capitalized or what it's worth; and, I've been asking you in writing. We have had this thing set in a little bit more than a month. I need to get somebody to go out and look at this thing. I retained somebody, and I need - and they need to go see it. (emphasis added).
MR. HUFFT:: I understand. And we're going to give you some documents to sign and everything.
MR. LOWE: Well, you got to get them to me.
MR. HUFFT: We will.
MR. LOWE: Because I don't control this guy's schedule, okay.
MR. HUFFT: I understand.
MR. LOWE: And we need to do it pretty quickly and I've - and I've been asking. It's in Pascagoula somewhere.
MR. BLAKE: Shipyard.

         Mr. Blake also confirmed, in response to questioning about the formation of Blake Offshore Drilling and its asset, the Blake 505, that funding for the business entity and its primary asset was based solely on Mr. Blake's personal guarantee to Whitney Bank for eleven or twelve million dollars, that Ms. DiMarco was not involved in the project and made no personal guarantees on the project, and that as a "protective measure" he never discussed Blake Offshore Drilling with Ms. DiMarco after the "Declaration of Separateness" was recorded in April 2005. When asked why he formed a business in February 2005 (shortly before filing for divorce) that would be a "community entity, " Mr. Blake conceded that he did not think of the community property implications at the time he formed Blake Offshore Drilling. Rather, he formed the entity to purchase the oil rig in anticipation of an "overseas contract, " but the potential contract did not come to fruition and, since then, Mr. Blake and his partner (in Blake Offshore Drilling) had "[b]een trying" to sell it to "[j]ust anybody that would have it." Mr. Blake was not asked, however, as to any specific parties previously or currently expressing any interest in purchasing the rig. When asked about details of the Whitney Bank funding for Blake Offshore Drilling, the "overseas contract" that "fell through, " and about documentation related to ""the deal [that] fell through, " Mr. Blake explained that there had been no "deal" because "there is no revenue produced by it, " and there was no documentation of the potential sale because it was "verbal" with "no contract signed."

         When questioned as to why it was necessary to refurbish the rig, Mr. Blake explained it was "to get it in other parts of the world where it could be used." When asked why they were only "slowly working" on refurbishing the rig, Mr. Blake explained that "it eats a lot of money, " funds that came out of his "own pocket" which could be verified by talking to his Chief Financial Officer, the person handling the specific financial details and records related to the rig. When asked why he was "delaying" refurbishing the rig so that it could be sold, Mr. Blake explained that, through his other companies, he had "three rigs in a shipyard getting outfitted . . . [s]o it's very expensive" and I'm limited on what I can do cashwise." When asked "what support do you have for the 17 million to refurbish" (the rig to make it operational), Mr. Blake responded that his "operational guy[], " Rodney Meisetschlager "produced" the budget for refurbishing. Finally, when asked if "any offers had been made to buy the rig, " Mr. Blake initially said "no, " but then qualified his answer: "Well, I mean, we've - we've talked to people; talked to brokers; trying to bring people over there to buy it. Just hadn't got any takers. Not in very good shape."

         When asked directly as to his selling price, Mr. Blake stated that was something he'd have to discuss with his partner. When asked his opinion as to what it was worth in its current condition, Mr. Blake said "I don't have it. I don't know." Mr. Lowe then asked about whether Mr. Blake had done a personal financial statement subsequent to June 14, 2005, and Mr. Blake deferred the question, ...

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