Cambrie Celeste, LLC and Cambrie Celeste Commercial Tenant, LLC v. Starboard Management, LLC, F.I.N.S. Construction, LLC, Cambrie Celeste Developer, LLC, Robert Armbruster and Nicole Armbruster

CAMBRIE CELESTE, LLC * NO. 2019-CA-0401
AND CAMBRIE CELESTE
COMMERCIAL TENANT, LLC *
COURT OF APPEAL
VERSUS *
FOURTH CIRCUIT
STARBOARD MANAGEMENT, *
LLC, F.I.N.S. STATE OF LOUISIANA
CONSTRUCTION, LLC, *******
CAMBRIE CELESTE
DEVELOPER, LLC, ROBERT
ARMBRUSTER AND NICOLE
ARMBRUSTER

APPEAL FROM
CIVIL DISTRICT COURT, ORLEANS PARISH
NO. 2012-01997, DIVISION “F”
Honorable Christopher J. Bruno, Judge
******
Judge Roland L. Belsome
******
(Court composed of Judge Roland L. Belsome, Judge Daniel L. Dysart, Judge
Paula A. Brown)

Julie U. Quinn
Justin E. Alsterberg
QUINN ALSTERBERG, LLC
855 Baronne Street
New Orleans, LA 70113

COUNSEL FOR PLAINTIFF/APPELLEE

Fred L. Herman
Jacob D. Young
Meredith E. Chehardy
CHEHARDY SHERMAN WILLIAMS
One Galleria Boulevard
Suite 1100
Metairie, LA 70001

COUNSEL FOR DEFENDANT/APPELLANT

AFFIRMED
December 4, 2019

This appeal stems from an eviction and subsequent damages judgment

rendered against Starboard Management Company, LLC, as a result of its failure to

pay rent. On appeal, Defendants and owners of Starboard, Robert and Nicole

Armbruster, seek review of the trial court’s judgment finding them personally

liable for the damages judgment against Starboard. For the following reasons, we

affirm.

FACTS AND PROCEDURAL HISTORY

On March 1, 2012, Plaintiffs, Cambrie Celeste LLC and Cambrie Celeste

Commercial Tenant, LLC (CCCT), filed a Petition for Eviction and for Damages

for Breach of Lease against numerous defendants: Starboard, Robert and Nicole

Armbruster, F.I.N.S Construction, LLC, and Cambrie Celeste Developer, LLC. In

response, Defendants filed an answer and reconventional demand. In October of

2013, the trial court ultimately rendered a judgment evicting Starboard and placing

Plaintiffs in possession of the leased property located at 621 Celeste Street, in New

Orleans.

1

After a contempt hearing was held as a result of Starboard’s repeated failure

to provide discovery responses, the trial court dismissed Starboard’s affirmative

defenses and prohibited it from raising any new affirmative defenses. Later, on

November 14, 2014, Plaintiffs filed a motion for summary judgment as to

damages. In response, Starboard filed a motion for reconsideration or

reinstatement of its affirmative defenses and reconventional demand. In addition,

on December 24, 2014, Robert Armbruster signed an affidavit to dissolve

Starboard. It was filed with the Louisiana Secretary of State’s office on December

29, 2014.

Following a hearing on July 27, 2016, the trial court denied Starboard’s

motion for rehearing on the affirmative defenses as untimely and rendered

summary judgment in favor of the Plaintiffs in the amount of $1,614,941.69

against all Defendants.1 The Defendants filed a suspensive appeal.

During the pendency of the appeal, Starboard file a petition for bankruptcy

in U.S. Bankruptcy Court for the Eastern District of Louisiana.2 On December 16,

2016, Starboard filed a motion to reinstate in order to proceed in bankruptcy court.

On January 13, 2017, the court issued an order to reinstate Starboard; however, it

was not filed with the Secretary of State at that time.

On November 6, 2017, this Court upheld the damages judgment against

Starboard but reversed the judgment as to all other defendants since Starboard was

1
The hearing on the motion for summary judgment was delayed due to the parties’ agreement to
stay the case while they attempted to settle their various legal disputes.
2
This case was automatically stayed pending the resolution of the bankruptcy case.

2

the only defendant prohibited from using its affirmative defenses.3 Then, on

December 7, 2018, Plaintiffs filed a motion to enforce personal liability against

Defendants, Robert and Nicole Armbruster, for Starboard’s debts in connection

with the damages judgment, pursuant to La. R.S. 12:1335.1.

In response, on January 17, 2019, Starboard submitted the bankruptcy

court’s reinstatement order to the Secretary of State’s office. On the same day, the

Louisiana Secretary of State reinstated Starboard.4 After a hearing on February 8,

2019, the trial court granted the Plaintiffs’ motion to enforce personal liability

against the Armbrusters for Starboard’s July 26, 2016 damages judgment. This

appeal followed.5 The February 8, 2019 judgment was later amended pursuant to

this Court’s order to include the proper decretal language.

STANDARD OF REVIEW

As the facts in this matter are not in dispute and the issue is purely one of

statutory interpretation, we review this matter de novo, without deference to the

legal conclusions of the courts below. Turner v. Willis Knighton Med. Ctr., 12-

0703, p. 4 (La. 12/04/12), 108 So.3d 60, 62 (citation omitted).

DISCUSSION

On appeal, the Armbrusters assert that the trial court erred in finding them

personally liable for the damages judgment rendered against Starboard. They raise

3
Cambrie Celeste LLC v. Starboard Mgmt., LLC, 16-1318, p. 19 (La. App. 4 Cir. 11/6/17), 231
So.3d 79, 89, writ denied, 17-2041 (La. 2/2/18), 235 So.3d 1110.
4
The trial court relied on the Secretary of State’s certificate in finding there was an additional
dissolution. While the Armbrusters dispute this fact, there is no evidence to suggest the trial
court’s determination was manifestly erroneous. Nevertheless, this issue is not material to the
determinations made in this appeal.
5
While the Armbrusters caption their appeal brief as an application for supervisory writ of
review, the record reflects that they filed a motion for a devolutive appeal.

3

two issues: 1) the trial court erred in enforcing personal liability against them,

pursuant to La. R.S. 12:1335.1, and 2) the motion to enforce personal liability was

procedurally improper.

PERSONAL LIABILITY

First, the Armbrusters claim that the trial court erred in holding that they

were personally liable for the damages judgment. We disagree.

La. R.S. 12:1335.1 states:

A. In addition to all other methods of dissolution, if a limited liability
company is no longer doing business, owes no debts, and owns no
immovable property, it may be dissolved by filing an affidavit
with the secretary of state executed by the members or by the
organizer, if no membership interests have been issued, attesting to
such facts and requesting that the limited liability company be
dissolved. Thereafter, the members, or the organizer if no
membership interests have been issued, shall be personally liable
for any debts or other claims against the limited liability company
in proportion to their ownership interest in the company. The
secretary of state may prescribe and furnish forms for filing the
affidavit.

B. The secretary of state shall reinstate a limited liability company
that has been dissolved pursuant to this Section only upon receipt
of an order issued by a court of competent jurisdiction directing
him to do so. (Emphasis supplied).

In this case, Starboard was properly served with the petition for eviction and

damages on March 15, 2012. Later, on December 29, 2014, Starboard was

dissolved by affidavit, pursuant to La. R.S. 12:1335.1, during the pendency of the

motion for summary judgment on damages. In the affidavit, Mr. Armbruster

declared that Starboard was no longer doing business, owed no debts, and was

dissolved. Despite dissolving Starboard, Robert Armbruster and his counsel

proceeded on behalf of Starboard at the hearing on the motion for summary

4

judgment without objection. After the hearing, the trial court rendered a damages

judgment against Starboard on July 27, 2016.

On January 13, 2017, after the damages judgment was rendered against

Starboard, the bankruptcy court issued a re-instatement order. On December 7,

2018, Plaintiffs sought to enforce personal liability against the Armbrusters. Once

Plaintiffs sought to enforce personal liability, Starboard filed the bankruptcy

court’s reinstatement order with the Secretary of State, on January 17, 2019. After

a hearing on February 8, 2019, the trial court found the Armbrusters personally

liable for Starboard’s debt in connection with the damages judgment.

While the Armbrusters now suggest that the damages judgment is invalid

since Starboard was dissolved at the time the judgment was rendered, this issue

was not raised with the trial court before proceeding on the motion for summary

judgment, or on appeal. The July 27, 2016 damages judgment against Starboard is

now a valid final judgment. Since Starboard was dissolved at the time the

judgment was issued, the Armbrusters are personally liable pursuant to La. R.S.

12:1335.1, which imposes personal liability, “for any debt or other claims,” on the

members of an LLC in proportion to their ownership interest once the LLC is

dissolved.

In addition, the Armbrusters argue that Starboard was reinstated on January

13, 2017, pursuant to the bankruptcy court’s order. They conclude that since

Starboard was reinstated before the hearing and judgment on the motion to enforce,

they cannot be held personally liable.

5

Despite argument to the contrary, Starboard was not re-instated until January

17, 2019, when it filed the reinstatement order with the Secretary of State.6

Nevertheless, regardless of whether Starboard was reinstated in January 2017 or

January 2019, our conclusion remains the same, unless reinstatement was

retroactive to the date of dissolution.

In this case, there is nothing to suggest Starboard requested retroactive

application of the reinstatement order below. Additionally, the bankruptcy court

did not order the reinstatement to have retroactive effect. Since the Armbrusters

do not argue that reinstatement is retroactive on appeal, the issue is not before this

Court.

Nevertheless, the law and jurisprudence signify that reinstatement, under

these circumstances, is prospective, only, so as not to shield the members from

personal liability. See La. R.S. 12:1300 et seq.; In re Reinstatement of S&D

Roofing, LLC, 16-085, pp. 4-5 (La. App. 5 Cir. 9/22/16), 202 So.3d 177, 180-81

(statute permitting reinstatement of an LLC dissolved by affidavit was silent on the

matter of retroactivity, suggesting legislature did not intend reinstatement to be

given retroactive effect, and public policy did not support retroactive

reinstatement, since at time of LLC dissolution, one member was aware that a

lawsuit was pending against LLC); Cf, Robertson v. Weinmann, 00-0799, p. 6 (La.

App. 4 Cir. 2/21/01), 782 So.2d 38, 42 (holding that reinstatement of a corporation

dissolved by affidavit should not be given retroactive effect unless expressly stated

by the legislature).
6
La. R.S. 12:1335.1(B) explicitly requires the Secretary of State to reinstate a limited liability
company, which was dissolved pursuant to an affidavit, but only after receiving a court order.
The bankruptcy order explicitly directs the Secretary of State to reinstate Starboard pursuant to
La. R.S. 12:1335.1(B). It further directs Starboard’s counsel to serve the required parties who
would not otherwise receive notice. However, Starboard did not file the reinstatement order and
obtain reinstatement with the Secretary of State until January 17, 2019.

6

Given that Starboard was dissolved by affidavit at the time the damages

judgment was issued against it and the reinstatement did not have retroactive

effect, the Armbrusters are personally liable in proportion to their ownership for

the judgment. As such, the trial court correctly found the Armbrusters personally

liable for Starboard’s damages judgment, pursuant to La. R.S. 12:1335.1(A).

PROCEDURAL CAPACITY

Next, the Armbrusters argue that the motion to enforce personal liability was

procedurally improper. Citing to S&D Roofing, LLC, supra and Butcher v. Keith

Hebert Carpentry/Vinyl Siding, Inc., 06-0672 (La. App. 3 Cir. 12/20/06), 945

So.2d 914, they assert that the petition for damages should have been amended to

include them in their personal capacities. However, neither S&D Roofing nor

Butcher makes such a conclusion. Moreover, unlike in Butcher,7 where the

petition was amended to include the corporate shareholder individually, the record

in this case reflects that the Armbrusters were already named in their personal

capacity in the original petition for eviction and damages. Under these

circumstances, an amendment was not necessary. Thus, there was no procedural

error in proceeding against the Armbrusters in their personal capacity.

CONCLUSION

Considering the foregoing circumstances, the trial court’s judgment

enforcing personal liability against the Armbrusters, pursuant to La. R.S.

12:1335.1, was legally and procedurally correct. Accordingly, we affirm.

AFFIRMED

7
06-0672, p. 2, 945 So.2d at 915.

7