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LLC v. Clipper Construction, LLC

Court of Appeals of Louisiana, Fifth Circuit

May 15, 2019

131 BEVERLY KNOLL, LLC
v.
CLIPPER CONSTRUCTION, LLC

          ON APPEAL FROM THE TWENTY-FOURTH JUDICIAL DISTRICT COURT PARISH OF JEFFERSON, STATE OF LOUISIANA NO. 710-152, DIVISION "A" HONORABLE RAYMOND S. STEIB, JR., JUDGE PRESIDING

          COUNSEL FOR PLAINTIFF/APPELLEE, 131 BEVERLY KNOLL, LLC Jason M. Cerise, Omer F. Kuebel, III, Natalie M. White

          COUNSEL FOR DEFENDANT/APPELLANT, CLIPPER CONSTRUCTION, LLC AND JOSEPH S. TUFARO Thomas P. Hubert, David K. Theard

          Panel composed of Judges Stephen J. Windhorst, Hans J. Liljeberg, and John J. Molaison, Jr.

          STEPHEN J. WINDHORST, JUDGE

         Appellants, Clipper Construction, LLC ("Clipper Construction") and Joseph S. Tufaro ("Tufaro"), appeal the trial court's (1) May 22, 2017 confirmation of default judgment in favor of appellee, 131 Beverly Knoll, LLC ("131 Beverly Knoll"), and against appellants; and (2) May 21, 2018 judgment denying appellants' motion for new trial. Appellants also filed a peremptory exception of res judicata in this Court. For the reasons that follow, appellants' peremptory exception of res judicata is overruled and the trial court's May 22, 2017 confirmation of default judgment and May 21, 2018 denial of appellants' motion for new trial are affirmed.

         Facts and Procedural History

         On January 10, 2012, appellee, 131 Beverly Knoll, filed a "Petition for Executory Process and Appointment of Keeper" against Clipper Construction. In its petition, appellee asserted the following: (1) it was the holder and owner of two promissory notes ("notes") executed in 2005 and 2008 by Tufaro on behalf of Clipper Construction ("Borrower") in favor of First Community Bank ("FCB" or "Lender"); (2) the notes were secured by a mortgage executed by Tufaro on behalf of Borrower; (3) the notes were obtained for the sole purpose of building a residential home at 129 Beverly Drive ("Beverly Property");[1] (4) the Beverly Property was used to secure the notes; (5) Troy Duhon purchased the notes and collateral documents from FCB; (6) Duhon assigned the notes and collateral documents to appellee; (7) the notes and mortgage were in default; (8) the current indebtedness due to appellee; (9) notice of default was sent to Borrower; and (10) Borrower failed to remit payment.[2]

         On January 12, 2012, based on the allegations in the petition and attachments thereto, the trial court ordered a writ of seizure and sale of the Beverly Property. On October 3, 2012, the Beverly Property was sold for $885, 000.00.

         On August 25, 2015, appellee filed a "Second Amended and Restated Petition Converting Executory Process Foreclosure to Deficiency Judgment Action," adding Tufaro, individually, as an additional defendant.[3] The second amended petition contended that the price at the foreclosure sale was insufficient to satisfy the indebtedness owed to appellee and requested that the proceeding be converted to an ordinary proceeding to obtain the deficiency amount owed.[4] Appellants were personally served with the second amended petition on February 2, 2016.

         On February 24, 2016, appellee filed a motion for preliminary default judgment after appellants failed to appear or file an answer or pleading. On February 14, 2017, the trial court granted the motion for preliminary default judgment.[5]

         On May 22, 2017, appellee filed a motion for confirmation of default judgment.[6] On the same day, the trial court granted judgment in favor of appellee and against appellants, in solido, for the principal sum of $274, 443.53, plus accrued interest thereon through May 18, 2017 in the amount of $270, 231.92, together with attorney fees in the amount of $33, 502.50, plus costs and expenses in the amount of $1, 352.90, plus interest continuing to accrue thereafter on said sums at the rate of 21% per annum, until paid, plus all attorney's fees, costs, and expenses incurred with the collection and/or enforcement of the judgment.

         On May 30, 2017, appellants filed a motion to annul default judgment or alternatively, motion for new trial, alleging (1) the ill practices of appellee's counsel for failing to notify appellants' counsel of its intention to file a motion for preliminary default judgment and to confirm the default judgment, when appellee knew appellants were represented by counsel; and (2) that Tufaro believed that the claims in the second amended petition for deficiency judgment were extinguished by a settlement agreement entered into by the parties in November 2012 ("2012 Settlement Agreement"), one month after the Beverly Property was sold. Appellants filed a consent motion[7] to continue and reset the hearing, which the trial court denied on July 31, 2017, stating "the Motion to Annull [sic] Default Judgment is Denied Improper Form."[8]

         On March 22, 2018, appellants filed an unopposed motion to reset their motion for new trial, arguing that the trial court did not rule on their previously filed motion for new trial. Appellants' motion for new trial was set for hearing.

         On May 9, 2018, after argument of counsel and submission of exhibits into evidence, the trial court denied appellants' motion for new trial.[9] The trial court found that (1) appellants were properly served with the petition; (2) appellants failed to appear or file an answer or other pleading; (3) in February 2016, appellee's counsel sent, and appellants received notice of, appellee's intention to file a motion for preliminary default; (4) appellants had over a year to file an answer or other pleading in response to the motion for preliminary default but failed to do so; (5) the motion for preliminary default was granted almost one year after it was filed; (6) the evidence supporting the motion for confirmation of default judgment presented a prima facie case; and (7) the confirmation of default judgment was properly served on appellants. A written judgment denying the appellants' motion for new trial was signed on May 21, 2018. This appeal followed.

         Discussion

         On appeal, appellants contend that the trial court erred in granting appellee's motion for confirmation of default judgment and denying appellants' motion for new trial. Additionally, appellants filed a peremptory exception of res judicata, for the first time, with this Court. Appellants' peremptory exception may be raised for the first time in the appellate court pursuant to La. C.C.P. art. 2163, and will be considered herein.[10]

         Exception of Res judicata

         Appellants contend that on November 6, 2012, one month after the Beverly Property was sold in this proceeding, the parties entered into the 2012 Settlement Agreement, which extinguished any debt owed and remaining by Clipper Construction and/or Tufaro to Duhon concerning the Beverly Property. Appellants assert that the 2012 Settlement Agreement involves the same parties and the same ...


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