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Noles-Frye Realty v. Dixon

Court of Appeals of Louisiana, Third Circuit

May 9, 2018

NOLES-FRYE REALTY (NAI LATTER & BLUM)
v.
HOLLY DIXON, ET AL

          APPEAL FROM THE NINTH JUDICIAL DISTRICT COURT PARISH OF RAPIDES, NO. 254, 605 HONORABLE THOMAS MARTIN YEAGER, DISTRICT JUDGE

          William M. Ford COUNSEL FOR DEFENDANTS/APPELLEES: Holly Dixon Sandra Daico Diana Ratner Jayn Robison

          Christie C. Wood Wilson & Wilson COUNSEL FOR DEFENDANTS/APPELLANTS: Andrea Talbot Adrian Talbot

          Michael S. Ricci COUNSEL FOR PLAINTIFF/APPELLEE: Noles-Frye Realty (NAI LATTER & BLUM)

          Court composed of Sylvia R. Cooks, Marc T. Amy, and John E. Conery, Judges.

          MARC T. AMY JUDGE

         Following the failure of a purchase agreement, a realty company commenced this concursus proceeding so that the sellers and the purported buyer could advance their claims of ownership to the underlying deposit. Following a hearing, the trial court ruled in favor of the sellers after observing that, although the buyer was credible in her testimony regarding her inability to secure financing for the home, she failed to produce corroborating documentary or testimonial evidence in that regard. The buyer appeals. Following review, we reverse and render.

         Factual and Procedural Background

         Noles-Frye Realty filed a Petition for Concursus instituting this matter in December 2015, noting that it "became aware that a dispute existed as to the ownership or entitlement of funds, held in escrow as a result of a real estate transaction." The parties to the underlying transaction, a September 2015 Louisiana Residential Agreement to Buy or Sell ("the Agreement"), were named as defendants in the proceeding. The record indicates by the Agreement, Andrea Soltau-Talbot ("the Buyer"), [1] sought to purchase residential property in Alexandria offered for sale by Holly Dixon, Sandra Damico, Diane Ratner, and Jayn Robison (hereinafter "the Sellers").[2] Although the closing date was twice extended, the sale was not completed.

         Both the Buyer and the Sellers claimed entitlement to the $30, 000.00 deposit provided by the Buyer pursuant to the Agreement. Each focused on the initial inquiry as to whether the Agreement provided that the sale was to be a financed one and the effect of the Agreement's condition that:

This sale is conditioned upon the ability of BUYER to borrow with this Property as security for the loan the sum of $ TBD or ___% of the Sale Price by a mortgage loan or loans at an initial interest rate not to exceed ___% per annum, interest and principal, amortized over a period of not less than ___years, payable in monthly installments or on any other terms as may be acceptable to the BUYER provided that those terms do not increase the cost, fees or expenses to the SELLER.

         The Agreement further indicated that the loan was to be secured by "Fixed Rate Mortgage[.]" Following "Other financing conditions[, ]" it provided that: "Financing to be done w/credit union in New Orleans that buyer is member of. Buyer has already prequalified."

         In support of their claim to the deposit, the Sellers argued that, while the Agreement indicated that the sale was to be a financed one, the "TBD" and otherwise uncompleted aspects of the financing details indicated that the sale was not, in fact, contingent on financing. As the sale was not completed, the Sellers sought the deposit by the purchase agreement's provision that:

DEFAULT OF AGREEMENT BY BUYER: In the event of any default of this Agreement by the BUYER, the SELLER shall have at the SELLER'S option the right to declare this Agreement null and void with no further demand, or to demand and sue for any of the following: 1) Termination of this Agreement; 2) Specific performance; 3) Termination of this Agreement and an amount equal to 10% of the Sale Price as stipulated damages.

Further, the SELLER shall be entitled to retain the Deposit. The prevailing party to any litigation brought to enforce any provision of this Agreement shall be awarded their attorney fees and costs. The BUYER may also be liable for Broker fees.

(Emphasis added.)

         Conversely, the Buyer contended that she was unable to secure financing and that, by operation of the financing contingency, she was entitled to the return of the deposit pursuant to the following:

RETURN OF DEPOSIT: The Deposit shall be returned to the BUYER and this Agreement declared null and void without demand in consequence of the following events:
. . . .
2) If this Agreement is subject to the BUYER'S ability to obtain a loan and the loan cannot be obtained, except as stated in lines 70 through 77 of this Agreement, but only if the BUYER has made timely application for ...

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