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Law Office of Brian E. Crawford, L.L.C. v. Winnsboro Elevator, L.L.C.

Court of Appeals of Louisiana, Second Circuit

June 27, 2018


          Appealed from the Fourth Judicial District Court for the Parish of Ouachita, Louisiana Trial Court No. 2016-3162 Honorable B. Scott Leehy, Judge

          MATHERNE & DAVIS By: Valerie Van Matherne Lauren Pickett Davis Counsel for Appellant

          JAMES MATTHEW HOLLIS Counsel for Appellees

          Before PITMAN, GARRETT, and COX, JJ.

          GARRETT, J.

         The plaintiff, the Law Office of Brian E. Crawford, L.L.C., appeals from a trial court judgment that rejected its open account claim against two individuals. The trial court found that the plaintiff failed to provide sufficient corroborating evidence required by La. C.C. art. 1846 to prove an oral contract to represent the individual members of a limited liability company. Finding no error by the trial court, we affirm the trial court judgment, which dismissed the plaintiff's claims against the individual defendants.


         From the trial testimony of Brian Crawford ("Brian"), we glean the following. Over the years, Brian performed legal work on behalf of Winnsboro Elevator, L.L.C. ("Winnsboro"), a company in the grain elevator storage business, and its agents and officers, Noble E. Ellington, Jr., and his son, Ryan Ellington. While both were members of the company, Ryan was the manager of the elevator. Brian testified that, in the first litigation he handled for them, the company and both men were his clients, but the company was the only named party.

         At some point, Winnsboro sold the facilities that formerly housed its operations and the grain stored in the silos to Lakeland Grain Company; ultimately, Agspring purchased those assets. Agspring filed suit against Lakeland and Winnsboro, alleging that some of the grain sold to them was spoiled and that the two companies, through their officers and directors, had failed to disclose the condition of the grain, thereby reducing the value of the purchased assets.

         In the summer of 2014, Brian met with Noble and Ryan about this lawsuit and agreed to represent them. Because Winnsboro was essentially defunct and had no funds, consideration was given to not defending against the suit. Due to the possibility of personal liability against Noble and Ryan as members and managers, Brian did not agree with this course of action. In August 2014, Noble requested that Brian prepare an estimated budget for the case in the event that it went through discovery and trial. The budget, which estimated costs of $46, 175, was emailed to Noble, who responded, "A good bit more than we thought!" Nonetheless, Brian provided representation in the case. Brian performed various legal services, including representing Noble and Ryan at their depositions.[1] Although they were not named as defendants, there were allegations that they knowingly or negligently failed to disclose the condition of the grain. The case eventually settled in about November 2015. According to Brian, the settlement documents identified Noble and Ryan as members and managers of Winnsboro and released them from any individual responsibility. Winnsboro was relieved of paying any money unless it secured settlements in unrelated cases involving BP and Syngenta.[2]

         At the conclusion of the litigation, Brian sought payment of his legal bills. He had numerous conversations with Ryan and Noble. The Ellingtons told him that they were still having financial difficulty and that they would pay him when they received funds from settlements in the unrelated claims involving BP and Syngenta. (Brian was not involved as counsel in either of those cases.) Brian also sent several demand letters which were addressed to Ryan and Noble. The first demand letter, which was dated December 21, 2015, stated that, due to Noble and Ryan's assertion that Winnsboro had no funds, the plaintiff had agreed to forgo monthly payment of bills and allow them to pay when they were able to do so. However, the letter recited a conversation between Brian and Noble wherein Noble indicated "that he understood that payment would not be required for these legal services until, or unless, settlement was reached in either the BP or Syngenta cases." Brian stated in the letter that there was no such agreement and that he would have never agreed to such a contingency on an hourly rate case.

         In October 2016, the plaintiff filed this lawsuit on open account, against Winnsboro, Noble and Ryan. The petition asserted that the defendants owed legal fees in the amount of $47, 338.24, together with interest and attorney fees and costs, pursuant to La. R.S. 9:2781. It alleged that the defendants agreed to pay an hourly rate of $225 for attorney work and $90 per hour for paralegal work, plus reimbursement of expenses incurred by the plaintiff, and that they were sent monthly invoices itemizing the work performed and the amount charged. The total debt was $47, 473.24; the only payment made was $135 in July 2014. Attached to the petition were a statement dated July 31, 2016, showing the balance owed of $47, 338.24; copies of five demand letters; and copies of the law firm's detail transaction file list showing the billable hours and amounts owed. A verification and affidavit by the law firm's bookkeeper affirmed the correctness of the petition and the accuracy of the monthly statement and detail transaction file list.

         The defendants filed a general denial answer. Noble and Ryan also filed an exception of no right of action in which they claimed that they never entered into any contractual relationship with the plaintiff in their personal capacities and that the plaintiff never represented them in their personal capacities. They maintained that any legal services were performed solely on behalf of the company. The exception was withdrawn immediately prior to the trial on the merits held on April 3, 2017.

         Only two witnesses testified - the law firm's bookkeeper and Brian. The bookkeeper verified the monthly invoices for the legal work, and they were admitted into evidence. She also stated that the invoices showed "Winnsboro Elevator LLC/Agspring" as the client, and that no invoices had Noble's or Ryan's personal names on them. The only payment received was a check for $135 from Winnsboro in July 2014. In his testimony, Brian set forth the history of his legal work for the defendants, as explained above. He considered Noble and Ryan to be longtime friends and valued clients. Because he trusted them to pay their legal fees, he did not require them to execute a personal guaranty agreement for his representation. He testified that the Ellingtons orally guaranteed Winnsboro's debt and that he would not have accepted representation had they not done so. The demand letters and the email exchange with the proposed budget were admitted during his testimony. Noble and Ryan did not testify or present any evidence. ...

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