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Gaubert Oil Company, Inc. v. Bayou Fuel Marine And Hardware Supplies, Inc.

Court of Appeals of Louisiana, Fifth Circuit

October 23, 2019

GAUBERT OIL COMPANY, INC.
v.
BAYOU FUEL MARINE AND HARDWARE SUPPLIES, INC., C&M CONTRACTORS INC., LAFITTE REAL ESTATE, L.L.C., JACQUELYN R. DAIGLE, JARED DAIGLE, CHAD DAIGLE, GULF COAST BANK AND TRUST COMPANY, NEW ORLEANS REGIONAL BUSINESS DEVELOPMENT LOAN CORPORATION, JLH ENTERPRISES, L.L.C., JEAN LAFITTE HARBOR, L.L.C., JEAN LAFITTE MARINE, L.L.C.

          ON APPEAL FROM THE TWENTY-FOURTH JUDICIAL DISTRICT COURT PARISH OF JEFFERSON, STATE OF LOUISIANA NO. 759-820, DIVISION "N" HONORABLE STEPHEN D. ENRIGHT, JR., JUDGE PRESIDING

          COUNSEL FOR PLAINTIFF/APPELLANT, GAUBERT OIL COMPANY, INC. Daniel A. Ranson Ryan C. Higgins

          COUNSEL FOR DEFENDANT/APPELLEE, GULF COAST BANK AND TRUST COMPANY, NEW ORLEANS REGIONAL BUSINESS DEVELOPMENT LOAN CORPORATION Wayne A. Maiorana, Jr. Robert A. Mathis

          Panel composed of Judges Marc E. Johnson, Stephen J. Windhorst, and John J. Molaison, Jr.

          JOHN J. MOLAISON, JR. JUDGE

         This is an appeal from the grant of a partial summary judgment in favor of two defendants, Gulf Coast Bank and Trust Company (Gulf Coast) and New Orleans Regional Business Development Loan Corporation (RLC) in a revocatory action filed by Gaubert Oil Company, Inc. (Gaubert). The revocatory action is one of several claims asserted in a petition filed by Gaubert against numerous defendants as a result of a default on a promissory note held by Gaubert. Gulf Coast and RLC (collectively known as "the lenders") are lenders and hold mortgages and other security interests in certain immovable and movable property that Gaubert asserts was owned by Bayou Fuel Marine and Hardware Supplies, Inc. (Bayou Fuel), the maker of the promissory note which forms the basis of the revocatory action. Gaubert asserts that the property was sold to a third party, increasing or causing the insolvency of the debtor. For the following reasons, we affirm the judgment.

         PROCEDURAL HISTORY

         On April 12, 2016, Gaubert filed a petition naming defendants, Bayou Fuel, C&M Contractors, Inc. (C&M), Lafitte Real Estate, LLC (Lafitte Real Estate), Gulf Coast, RLC, Jean Lafitte Harbor, LLC, Jean Lafitte Marine, LLC, JLH Enterprises, LLC, (JLH), Jacquelyn Daigle, Chad Daigle, and Jared Daigle as solidary obligors. The petition states a claim for indebtedness on a promissory note made by Bayou Fuel, a revocatory action, enforcement of a security interest and purchaser liability.

         The petition claims that on March 3, 2016, Bayou Fuel, C&M and Lafitte Real Estate sold movable and immovable property to JLH, adversely affecting Gaubert's security interest in the property. The petition prays for a judgment against all defendants, who Gaubert asserts are solidary obligors, that includes the annulment of the sale and transfer of any property, the liquidation of the property, and the annulment of any and all security interests held by the lenders resulting from the sale.

         Gaubert filed a motion for summary judgment against defendants Bayou Fuel, Jacquelyn Daigle, Jared Daigle and Chad Daigle as to a promissory note made by Bayou Fuel in Gaubert's favor. The trial court granted that motion in a judgment rendered on December 17, 2017. In that judgment, the trial court found that Bayou Fuel and the Daigles defaulted on a promissory note and were solidarily liable for payment to Gaubert in the amount of $609, 726.35. That judgment was appealed to this Court. However, before the appeal was considered, the parties reached a compromise to satisfy the judgment, and ultimately filed a joint motion to dismiss the appeal. This Court granted that motion on October 8, 2018. Gaubert Oil Company, Inc., v. Bayou Marine and Hardware Supplies, Inc., 18-225 (La.App. 5th Cir.).

         In the instant appeal, Gulf Coast and RLC filed a motion for summary judgment, primarily arguing that a revocatory action cannot cancel a lender's mortgage. The trial court granted the summary judgment finding in part that, a revocatory action only lies to revoke contracts between third parties and the obligor. The trial court reasoned that at the time of the sale, Lafitte Real Estate and C&M, two of the sellers, were not Gaubert's obligors. Finally, the trial court found that Gaubert had no recorded lien interests in the assets of Lafitte Real Estate and C&M at the time of the sale.

         Gaubert filed a motion for new trial which the trial court granted in part to clarify the original judgment. The trial court found that there is no genuine issue of material fact, and the lenders are entitled to judgment as a matter of law with regard to Gaubert's assertion of a revocatory action seeking to directly annul the lenders' mortgages and security interests, and dismissed those claims with prejudice. The judgment clarified that the summary judgment was granted as to Gaubert's assertion that the lenders' mortgages may be invalid based on a theory that Bayou Fuel, C&M and Lafitte Real Estate operated as a single business enterprise. The judgment makes it clear that nothing in the original judgment affects Gaubert's claim that Bayou Fuel, C&M, and Lafitte Real Estate operated as a single business enterprise and that each is a solidary obligor on the promissory note, and that nothing in the original judgment is meant to affect the ranking of any security interest. Gaubert appeals.

         In a separate, but related appeal pending before this Court, defendants, JLH, Jean Lafitte Harbor, LLC and Jean Lafitte Marine, LLC, filed a motion for summary judgment in the revocatory action. The trial court granted that motion and dismissed Gaubert's revocatory action against JLH, noting that the other two defendants were previously dismissed with prejudice from this case by a judgment dated November 27, 2018. Gaubert Oil Company, Inc. v. Bayou Fuel Marine and Hardware Supplies, Inc., 19-252 (La.App. 5th Cir.) ___ So.3d ___.

         FACTS

         Bayou Fuel, C&M and Lafitte Real Estate are businesses started by Kenneth Daigle and Al Gross in the 1970's in Lafitte, Louisiana. Bayou Fuel operated as a marina and supply business selling fuel, groceries, marine and hardware supplies. C&M provided crane and dock services for the oil field industry with equipment to load and unload barges. C&M also rented boats and cabins, and operated a trailer park. Lafitte Real Estate owned the immovable property, located at 4932 Kenal Drive, which it leased to the other two entities.

         In 2006, Kenneth Daigle's sons, Chad and Jared, purchased Mr. Gross' 50% shares in the businesses for $2.6 million through financing and a mortgage with Whitney Bank. That mortgage was subsequently assigned to NCC Financial, LLC (NCC). After that transaction, all three businesses were owned by Jacquelyn Daigle (Nicholas Daigle's wife) (50%), Chad Daigle (26%) and Jared Daigle (24%) respectively.

         Gaubert, a supplier of commercial fuel including gasoline and diesel fuel, sold fuel to C&M and Bayou Fuel on an open account for many years, and the parties agreed that a good business relationship existed among them. In 2014, when the amount unpaid on the open accounts grew to about $900, 000.00, Gaubert put deliveries on a cash on delivery basis. Shortly thereafter, Gaubert and Bayou Fuel agreed to convert the accounts payable to a promissory note in favor of Gaubert. Gaubert agreed to waive the finance charges on the amount due, and Bayou Fuel executed a promissory note to Gaubert in the amount of $774, 670.14. In conjunction with the promissory note, the parties also executed a commercial security agreement encumbering the equipment, inventory, accounts receivables, and proceeds from the sale of any of the assets of Bayou Fuel. The documents were filed in the Lafourche Parish registry. After a few months, the companies stopped making payments to Gaubert on the promissory note because of financial restraints.

         In 2015, the Daigles' decided to sell all of their holdings. Their real estate agent secured an interested buyer, Nicholas Dinet, who agreed to purchase the real property and all equipment and inventory for $3.1 million. However, Mr. Dinet was unable to secure financing to complete the transaction.

         Further negotiations involved Maria Couevas, who was only able to secure financing in the amount of $1.8 million through a combination of loans including one by Gulf Coast and two by RLC. RLC is a community development entity which ...


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