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Lobell v. Denn

Court of Appeals of Louisiana, Fourth Circuit

December 19, 2018

KENNETH H. LOBELL
v.
CINDY ANN ROSENBERG DENN, ET AL

          APPEAL FROM CIVIL DISTRICT COURT, ORLEANS PARISH NO. 2008-03338, DIVISION "C" Honorable Sidney H. Cates, Judge

          Roderick R. Alvendia ALVENDIA KELLY & DEMAREST, L.L.C.

          Matthew L. Pepper LAW FIRM OF WONDERLY & PEPPER COUNSEL FOR PLAINTIFFS/APPELLANTS

          Harry Rosenberg PHELPS DUNBAR, L.L.P. Brian D. Katz Herbert A. Cade HERMAN HERMAN & KATZ, L.L.C. COUNSEL FOR DEFENDANTS/APPELLEES/PLAINTIFFS IN RECONVENTION

          Court composed of Judge Daniel L. Dysart, Judge Joy Cossich Lobrano, Judge Dale N. Atkins

          DANIEL L. DYSART JUDGE

         This action, a commercial lease dispute, has been the subject of protracted litigation, resulting in numerous decisions over the years from this Court and from the Louisiana Supreme Court.[1] What remains before this Court are concrete, distinct issues arising from a March 23, 2018 judgment appealed by plaintiffs-appellants, Kenneth H. Lobell and K.H.L. Canal, L.L.C. (hereafter, collectively, Lobell").[2]

         A separate appeal from this judgment was taken by defendants-appellants, Cindy Rosenberg Denn, Craig Rosenberg, Ricky Rosenberg, Harry Rosenberg, Lenore Rosenberg Bramblett, Ann Rosenberg Silberman, Carla Rosenberg Waggoner, Paige Rosenberg Hirschkop, Rosalie Rosenberg Samuelson, and Larry Rosenberg, and 2025 Canal Street, L.L.C.[3] (hereafter, collectively, the "Rosenbergs"), also decided this date.

         As will be discussed more fully here, we have reviewed the record in its entirety and we affirm the trial court's judgment as to the issues raised in this appeal, finding no abuse of the trial court's discretion in failing to amend the judgment.[4] We also grant the Rosenbergs' Motion to Strike Lobell's reply brief, but decline to award sanctions.

         FACTS AND PROCEDURAL BACKGROUND

         This case has a lengthy history which has been detailed in several decisions and we summarize those facts as follows.

         The lease at issue, concerning property located at 2025 Canal Street, New Orleans, Louisiana, was originally executed in 1957 between Simon and Herman H. Rosenberg to Eagle Enterprises, Inc. for a 60 year term, expiring on May 31, 2017.[5] In 1997, Mr. Lobell acquired the leasehold interest from the then-leaseholder and executed a "Consent and Agreement" ("lease") with the Rosenbergs (the heirs of Simon and Herman Rosenberg), by which Mr. Lobell assumed the terms of the original lease.[6] Among the requirements of the lease were the obligations of Lobell to pay monthly rent, to pay all ad valorem taxes, maintain insurance coverage of $2.6 million, place any insurance proceeds in a trust for the lessors to use to repair the building, repair damages within six months of the date of damage and generally keep the building in good repair.[7]

          The leased building was damaged in the aftermath of Hurricane Katrina and disputes arose between Lobell and the Rosenbergs, and, in particular "the disbursement and use of insurance proceeds, the payment of rent, and repairs to the building."[8] The Rosenbergs then sent a default letter to Lobell on December 28, 2007, following which Lobell sent a partial payment of past due rents which the Rosenbergs refused to accept.[9] After sending a supplemental default letter to Lobell on February 12, 2008, further detailing the manner by which the Rosenbergs believed Lobell had violated the lease, the Rosenbergs sent Lobell a notice to vacate the premises on May 29, 2008.[10]

         Lobell then instituted this action as a petition for a writ of possession and a possessory action for damages for the Rosenbergs' alleged failure to provide him the opportunity to cure the default; the Rosenbergs responded with an incidental demand based on Lobell's alleged breach of the lease.[11] Following a trial on the merits, the district court rendered judgment on August 22, 2013 in favor of the Rosenbergs and dismissed Mr. Lobell's claims. The court terminated the lease of the property and rendered a money judgment in favor of the Rosenbergs in the amount of $3, 647, 127.81."[12]

         On appeal to this Court, the judgment dismissing Lobell's claims against the Rosenbergs was affirmed, although the Court vacated that portion of the trial court judgment that terminated the lease and awarded damages. This Court determined that the Rosenbergs had not properly terminated the lease because they had not afforded Lobell an opportunity to remedy his default.[13] Lobell sought review of this decision with the Louisiana Supreme Court.

         After granting certiorari, the Louisiana Supreme Court reversed this Court's decision in Lobell II, finding that Lobell was not entitled to a cure period under the lease. The Court agreed with the trial court's findings that Lobell breached the lease in many manners and thus, "the Rosenbergs had ground[s] to terminate the lease."[14] Thus, the Court found no error in the trial court's determination that the lease had been properly terminated.[15] The Court remanded the matter to this Court to review the trial court's award of damages, as that issue had been pretermitted in the decision under review.[16]

         After remand, this Court considered the trial court's August 22, 2013 judgment awarding damages to the Rosenbergs of the following amounts: past due rent of $193, 749.69; $56, 766.67 in ad valorem taxes; restoration costs of $3, 230, 126.72; and attorney's fees in the amount of $166, 484.73.[17] In Lobell IV, this Court observed:

Mr. Lobell, on remand, reiterates his attack on the trial court's award of restoration costs but additionally and for the first time argues that we must now modify the awards of judicial interest and past due rent. We reject his arguments on these last two issues. His rent argument is premised upon the contention that the Supreme Court implicitly overruled the trial court's termination of the lease and instead concluded that the Rosenbergs' December 28, 2007, January 31, 2007, and February 12, 2008 letters terminated the lease. Thus, he argues, the award must be recalculated to reflect that no rent was due after February 2008. The trial judge, however, rejected this assertion and we explicitly affirmed his ruling on this point. Mr. Lobell failed to seek review of this ruling with the Supreme Court, which noted that this aspect of the trial judge's ruling is final. And we refuse to reopen the matter.

Lobell IV, pp. 6-7, 184 So.3d 850 at 854. The Lobell IV Court then addressed the issue of the award for restoration costs, finding "that the award for restoration costs was sufficiently substantiated by the evidence and is not clearly wrong." Id., p. 8, 184 So.3d at 855. Lobell applied to the Louisiana Supreme Court for a writ of certiorari to review this Court's opinion, which was denied on May 27, 2016. Lobell v. Rosenberg, 16-0669 (La. 5/27/16), 192 So.3d 744.

         Thereafter, on June 21, 2016, Lobell filed a Motion to Amend Judgment under La. C.C.P. art. 1951, seeking to have the trial court's "original judgment" (the August 22, 2013 judgment) amended so as to correct "errors of calculation." He argued that the judgment improperly awarded rents beyond the period of August 2005 through February 2008, and improperly ordered Lobell to pay taxes beyond 2008, the date on which he argued that the lease was terminated as per the Supreme Court decision in Lobell III. He further argued that the August 22, 2013 judgment awarded judicial interest in derogation of our jurisprudence regarding interest on restoration awards.

In July, 2016, the Rosenbergs filed several motions, including:
-A Motion and Order for the release of proceeds held by FNBC Bank pursuant to an irrevocable letter of credit based on the finality of the judgment following the Supreme Court's May 27, 2016 denial of Lobell's application for a writ of certiorari and review of this Court's decision in Lobell IV;
- A Motion to Assess and Order Payment of Post-Trial Unpaid Rent, Unpaid Taxes, Unpaid Insurance and Interest Thereon (hereafter, "Post-Trial Motions") by which the Rosenbergs maintained that they were entitled to rent, taxes and insurance which accrued from April 30, 2013 (the date the trial court determined that the lease had been terminated) and June 7, 2016 (the date on which the Lobell IV decision became final pursuant to La. C.C.P. art. 2166 E[18]);
-A Motion to Confirm Calculation of Judicial Interest, seeking judicial interest on the August 22, 2013 judgment from the date of judicial demand (June 20, 2008) through the date on which the judgment is paid;
-A Motion for Sanctions pursuant to La. C.C.P. art. 863, alleging that Lobell's Motion to Amend Judgment violates article 863;[19] and
-A Motion to Assess and Order Payment of Post-Trial Attorney Fees and Interest Thereon.

         The trial court heard arguments on the first two of the Rosenbergs' motions and by judgments dated September 6, 2016, the trial court granted the motion for the release of the proceeds held by FNBC Bank but denied the motion for post-trial unpaid rent, taxes, insurance and interest. The Rosenbergs then filed a Motion to Withdraw Funds from the Registry of the Court on September 23, 2016 and by judgment dated September 28, 2016, the trial court authorized the withdrawal of $4, 750, 000.00.

         The remaining motions were heard by the trial court on August 31, 2016 and by judgment dated September 27, 2016, the trial court denied Lobell's motion to amend the judgment. The judgment further found the Rosenbergs' motion to confirm the calculation of judicial interest to be "unnecessary" on the basis that the "LSBA's Judicial Interest Calculator is an appropriate calculator;" the motion to confirm amount of court costs and interest thereon to be "unnecessary" because

          "[t]rial court costs and appellate court costs are what they are;" and granted the motion for payment of post-trial attorney's fees and interest "with the issue of reasonableness and the starting date for calculating judicial interest reserved" and to be decided by the court if the parties could not agree as to the amount.

         The Rosenbergs filed a motion for a devolutive appeal of the September 6, 2016 judgment, while Lobell filed a motion for a devolutive appeal of the September 27, 2016 judgment. On appeal, this Court found that the judgments at issue were not final judgments, declined to convert the appeals into applications for supervisory writs and dismissed both appeals.[20]

         In the interim and while Lobell V was pending in this Court, the trial court issued a judgment on September 12, 2017, granting in part and denying in part the motion for post-trial attorney's fees and interest. It awarded the Rosenbergs the sum of $393, 536.28, with legal interest from the date of the judgment until paid.[21]

         On November 21, 2107, the Rosenbergs filed a Third-Party Petition for Alternative Writ of Mandamus and for Cancelation of Lis Pendens, by which they sought to have Dale Atkins, as Clerk of Court for Orleans ...


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