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Iberia Bank v. Dalton Construction, LLC

Court of Appeals of Louisiana, Second Circuit

June 26, 2019

IBERIA BANK Plaintiff-Appellee
v.
DALTON CONSTRUCTION, LLC AND NICHOLAS DALTON Defendants-Appellants IBERIA BANK Plaintiff-Appellee
v.
NICHOLAS DALTON Defendant-Appellant

          Appealed from the Forty-Second Judicial District Court for the Parish of DeSoto, Louisiana Trial Court Nos. 78952; 78953 Honorable Charles B. Adams, Judge

          MARK W. ODOM Counsel for Appellants

          McNEW, KING, & LANDRY, L.L.P. Counsel for Appellee By: William T. McNew April M. Hammett

          Before WILLIAMS, McCALLUM, and THOMPSON, JJ.

          THOMPSON, J.

         On November 20, 2017, Plaintiff, Iberia Bank, filed suit in the 42nd Judicial District Court to collect on a promissory note and guaranty (No. 78952). Named as defendants were Dalton Construction, LLC, and Nicholas Dalton, based on his execution of a commercial agreement guarantying the payment of Dalton Construction, LLC's indebtedness. On that same date, Plaintiff also filed a separate suit in the 42nd Judicial District Court on a line of credit agreement against Nicholas Dalton (No. 78953).

         Answers in both suits were filed by Defendants on January 26, 2018. Plaintiff filed motions for summary judgment ("MSJ") in both suits on March 16, 2018. The hearing on the MSJ in the suit on the promissory note/guaranty (No. 78952) was scheduled for April 24, 2018, before Division "B." The hearing on the MSJ in the suit on the line of credit (No. 78953) was scheduled for April 26, 2018, before Division "A." Counsel for both parties agreed to consolidate the two actions. On April 24, 2018, the actions were consolidated into No. 79, 852, and a hearing on the motions for summary judgment was set for May 31, 2018, in Division "B."

         On May 31, 2018, Defendants filed a motion to stay pending arbitration and for continuance, based upon an arbitration clause in the promissory note.[1] Plaintiff consented to a continuance to allow the motions for summary judgment and the motion to stay to be heard together. The motions were rescheduled for June 21, 2018. On June 20, 2018, Plaintiff filed a memorandum in opposition to the motion to stay pending arbitration. At the hearing on June 21, the trial court denied the motion to stay in open court (and signed a judgment to that effect on July 13, 2018) and granted a continuance as to the motions for summary judgment to allow oppositions to be filed. The trial court specifically ordered that "[A]ny opposition to the Motions [for] Summary Judgment be filed on or before July 12, 2018. If no opposition is timely filed, no hearing will be held and the Court shall rule on the Motions based on the record."

         No such opposition was filed, and the trial court signed a judgment on July 30, 2018, granting summary judgment in favor of Plaintiff and against Defendants in the suit on the promissory note/guaranty (No. 78952) in the amount of $69, 305.29, together with accrued interest of $2, 344.10 through October 18, 2017, interest accruing thereafter at the rate of 7.38% per annum until paid, late fees of $302.85, and reasonable attorney fees and costs. In a second judgment signed on July 30, 2018, the trial court granted summary judgment in favor of Plaintiff and against Nicholas Dalton in the suit on the line of credit (No. 78953) in the amount of $13, 018.55, together with accrued and unpaid interest of $1, 256.24 through October 18, 2017, interest accruing thereafter at the default rate provided for in the parties' agreement of 21% per annum until paid, late fees of $75, and reasonable attorney fees and costs. Defendants have appealed from the trial court's judgments denying their motion to stay and granting summary judgment in favor of Plaintiff in the suit on the promissory note/guaranty (No. 78952/52, 752-CA).[2]

         DISCUSSION

         The issue of whether a court should stay or compel arbitration is a question of law. Swaggart v. Doe, 50, 739 (La.App. 2 Cir. 04/05/17), 216 So.3d 1118, writ denied, 17-0758 (La. 09/22/17), 227 So.3d 822); Hansford v. Cappaert Manufactured Housing, 40, 160 (La.App. 2 Cir. 09/21/05), 911 So.2d 901, writ denied, 05-2338 (La. 03/17/06), 925 So.2d 542; Conagra Poultry Co. v. Collingsworth, 30, 155 (La.App. 2 Cir. 01/21/98), 705 So.2d 1280; Williams v. Keller Williams Realty, 14-0202 (La.App. 4 Cir. 11/05/14), 154 So.3d 605; Hennecke v. Canepa, 96-0772 (La.App. 4 Cir. 05/21/97), 700 So.2d 521, writ denied, 97-1686 (10/03/97), 701 So.2d 210. The applicable standard of review for questions of law is whether the trial court was legally correct or incorrect. Id.

         The failure of a party to arbitrate in accordance with the terms of an agreement may be raised either through a dilatory exception of prematurity demanding dismissal of the suit or by a motion to stay the proceedings pending arbitration, as was done in the case sub judice. Swaggart, supra; Long v. Jeb Breithaupt Design Build Inc., 44, 002 (La.App. 2 Cir. 02/25/09), 4 So.3d 930; Wied v. TRCM, LLC, 30, 106 (La.App. 2 Cir. 07/24/97), 698 So.2d 685.

         La. R.S. 9:4202 provides:

If any suit or proceedings be brought upon any issue referable to arbitration under an agreement in writing for arbitration, the court in which the suit is pending, upon being satisfied that the issue involved in the suit or proceedings is referable to arbitration under such an agreement, shall upon application of one of the parties stay the trial of the action until an arbitration has been had in accordance with the terms of ...

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