In Re: Precept Credit Opportunities Fund, L.P. Praying for Monition Vs.

IN RE: PRECEPT CREDIT * NO. 2022-CA-0067
OPPORTUNITIES FUND, L.P.
PRAYING FOR MONITION *
COURT OF APPEAL
*
FOURTH CIRCUIT
*
STATE OF LOUISIANA
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CONSOLIDATED WITH: CONSOLIDATED WITH:

SUZETTE LAWRENCE NO. 2022-CA-0068
REYNOLDS

VERSUS

PCOF PROPERTIES

APPEAL FROM
CIVIL DISTRICT COURT, ORLEANS PARISH
NO. 2018-08966, DIVISION “N-8”
Honorable Ethel Simms Julien, Judge
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Judge Daniel L. Dysart
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(Court composed of Judge Daniel L. Dysart, Judge Dale N. Atkins, Judge Pro
Tempore James F. McKay, III)

John A. E. Davidson
DAVIDSON & DAVIDSON, APLC
5000 W. Esplanade Ave
Suite A#284
Metairie, LA 70006

COUNSEL FOR PLAINTIFF/APPELLANT

James E. Uschold

Mark J. Boudreau
JAMES E. USCHOLD, PLC
700 Camp Street, Suite 317
New Orleans, LA 70130

COUNSEL FOR DEFENDANT/APPELLEE

AFFIRMED
SEPTEMBER 16, 2022

DLD Appellants, Suzette Lawrence Reynolds, Leslie Lawrence Adams, Kim
DNA
Lawrence Vanderson, and Henry Lawrence, III, (collectively “the Lawrence
JFM
heirs”) seek review of a November 10, 2021, trial court judgment sustaining

Appellee’s, Precept Credit Opportunities Fund, L.P. (PCOF), Exceptions of

Peremption and Res Judicata, denying Appellants’ Motion for Summary Judgment,

and dismissing Appellants’ nullity actions with prejudice. For the following

reasons, we affirm the judgment of the trial court.

PROCEDURAL AND FACTUAL BACKGROUND

On March 10, 2015, PCOF purchased a tax sale certificate for unpaid 2013

and 2014 ad valorem taxes on the property bearing the municipal address of 5732

Baccich Street, New Orleans, Louisiana 70122. PCOF recorded the certificate on

April 20, 2015, commencing a three-year redemption period. At that time, Harriet

Lawrence, the mother of the Lawrence heirs, was deceased. Henry Lawrence, the

Lawrence heirs’ father, died on June 5, 2018. On September 7, 2018, after the

redemption period expired without redemption, PCOF filed a Petition for

Monition, praying that the tax sale be homologated and that PCOF’s title to and

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full ownership of the property be confirmed. Pursuant to La. R.S. 47:2271, et seq,

PCOF identified each of the Lawrence heirs, mailed notice of the monition

proceedings to each Lawrence heirs’ last known address, and timely published the

monition in the official journal of Orleans Parish. No opposition to PCOF’s

Petition for Monition was filed during the applicable six-month delay.

Consequently, on April 24, 2019, the district court signed a Judgment Confirming

Title and Homologating Tax Sale in favor of PCOF. The Lawrence heirs did not

appeal this judgment.

On May 17, 2019, the Lawrence heirs filed an action to annul both the

monition judgment and the tax sale. PCOF filed Exceptions of Peremption and

Res Judicata. In turn, the Lawrence heirs filed oppositions to the PCOF exceptions

as well as a Motion for Summary Judgment on their nullity action. The trial court

initially ruled in favor of the Lawrence heirs, finding that the tax sale was

absolutely null for lack of pre-sale notice. However, on cross-motions for new

trial, the trial court reversed this decision, sustained PCOF’s Exceptions of

Peremption and Res Judicata, denied the Lawrence heirs’ Motion for Summary

Judgment, and dismissed the Lawrence heirs’ nullity action with prejudice, finding

that the absolute nullity of tax sales no longer exists under Louisiana law. A final

judgment was entered on November 10, 2021, and the Lawrence heirs timely

appealed.

STANDARD OF REVIEW

“A peremptory exception generally raises a purely legal question.” Wells

Fargo Fin. La., Inc. v. Galloway, 17-0413, p. 7 (La. App. 4 Cir. 11/15/17), 231

So.3d 793, 799-800. Appellate courts review Peremptory Exceptions of

Peremption under the manifest error-clearly wrong standard. Lomont v. Bennett,

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14-2483, p. 8 (La. 6/30/15), 172 So.3d 620, 627. If the Appellate Court determines

the that trial court’s findings are reasonable in light of the record, “[it] cannot

reverse even though [it is] convinced that had it been sitting as the trier of fact, it

would have weighed the evidence differently.” Id at 627.

“The standard of review of a peremptory exception of res judicata requires

an appellate court to determine if the trial court's decision is legally correct or

incorrect.” BBCL Entrs., LLC v. American Alt. Ins. Corp., 15-0469, p. 3 (La. App

4 Cir. 2/3/16) 187 So.3d 65, 67 (quoting Myers v. Nat’l Union Fire Inc. So. of

Louisiana, 09-1517, p. 5 (La. App. 4 Cir. 5/19/10), 43 So.3d 207, 210). Factual

issues are reviewed on a manifest error/clearly wrong basis. BBCL Entr.s, LLC,

187 So.3d at 67 (citing Countrywide Home Loans Serv., LP v. Thomas, 12-1304, p.

3 (La. App. 4 Cir. 3/20/13), 113 So.3d 355, 357).

“Appellate courts review summary judgments under the de novo standard of

review, using the same standard applied by the trial court in deciding the motion

for summary judgment; as a result, we are not required to analyze the facts and

evidence with deference to the judgment of the trial court or its reasons for

judgment.” Precept Credit Opportunities Fund, L.P. v. Elmore, 21-0502, (La.

App. 4 Cir. 2/20/22), 338 So.3d 87, 89-90, (citing Smith v. State, 18-0197, p. 3 (La.

App. 4 Cir. 1/9/19), 262 So.3d 977, 980). “After an opportunity for adequate

discovery, a motion for summary judgment shall be granted if the motion,

memorandum, and supporting documents show that there is no genuine issue as to

material fact and that the mover is entitled to judgment as a matter of law.” La.

C.C.P. art. 966(A)(3).

DISCUSSION

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On appeal, the Lawrence heirs argue that the trial court erred by sustaining

PCOF’s Exceptions of Peremption and Res Judicata, denying their Motion for

Summary Judgment, and dismissing their nullity action with prejudice. The

Lawrence heirs assert five assignments of error:

1. Post-sale notice does not cure the Constitutional entitlement to pre-sale

notice;

2. Under the amendment to La. R.S. 47:2153, taxing authorities must cancel

a tax sale in the absence of actual notice or proof of a reasonable effort to

provide notice after performing research before the sale. Although

Harriet Watson Lawrence was deceased at the time of the tax sale, she

was still the record owner and survived by appellees;

3. Without service of process, a court has no jurisdiction to render a

judgment against any person. A judgment does not cure an absolute

nullity, such as lack of pre-sale notice of a tax sale. A monition

proceeding is subject to the court’s rules of civil procedure. The failure to

serve notice of judgment leaves the monition judgment subject to a

motion for new trial as it is not final;

4. The City of New Orleans, as tax collector, has no authority to delegate its

constitutional duty to provide notice of delinquency to tax payers; and

5. The Affidavit of Ann Marie Sledge, an employee of Archon Information

Systems was accepted by the trial court concerning her assertions of

knowledge of the City of New Orleans notice procedures and the

transmission of tax notices from Temecula, California without explaining

how such notices became City records. The Affidavit should have been

stricken.

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This Court has recently addressed the exact arguments made in errors two,

four, and five. See Elmore, 21-0502, 338 So.3d 87. We agree with the Elmore

Court’s ruling on these issues. Accordingly, we find no merit to errors two, four,

and five, and we pretermit any further discussion of said errors. Moreover, in

order to reach a substantive discussion on the merits of the Lawrence heirs’

remaining assignments of error, this Court must first address whether the trial court

properly sustained PCOF’s Exceptions of Peremption and Res Judicata.

Exception of Peremption

“Tax sales are subject to a three-year redemption period which runs from the

date the tax sale deed is recorded. La. Const. Art. 7, § 25(B). The redemption

period is peremptive.” Succession of Caldarera v. Zeno, 09-1397, p. 6 (La. App. 4

Cir. 7/16/10), 43 So.3d 1080, 1085 (citing Harris v. Estate of Fuller, 532 So.2d

1367, 1369 (La. 1988)). Peremptive periods can be neither suspended nor

interrupted. Id., see also La. C.C. art. 3461.

A petition for Monition may be filed after the peremptive period expires to

protect the acquiring person from eviction. La. R.S. 47:2271. Louisiana Revised

Statute 47:2275 states in pertinent part that:

“[T]he petitioner shall send a written notice to all tax sale parties
whose interest the petitioner intends to be terminated….[W]ritten
notice shall provide that the parties have until…[s]ix months after the
first publication of the notice…if the proceeding is brought less than
five years after filing the tax sale certificate….This written notice
shall be sufficient, and it shall not be necessary to determine whether
any [other] notice of tax sale or other notices were given.” [emphasis
added]

La. R.S. 47:2275.

Here, PCOF recorded the tax sale certificate on April 20, 2015, triggering

the start of a peremptive redemption period which expired on April 20, 2018.

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Harriet and Henry Lawrence were the record owners at the time of the tax sale as

well as when PCOF recorded the tax certificate, although Harriet had predeceased

the tax sale. On September 17, 2018, after the redemptive period expired without

redemption by Henry Lawrence or any of the Lawrence heirs, PCOF filed a

Petition for Monition, praying that the tax sale be homologated and that PCOF’s

title to and full ownership of the property be confirmed. All parties were properly

noticed on October 11, 2018, and PCOF’s Monition was granted thereafter in

accordance with the statutory six-month delay.

It is uncontested that neither Henry Lawrence nor the Lawrence heirs

redeemed the tax sale prior to April, 20, 2018. Because the peremptive period

expired without redemption and PCOF’s monition was granted without opposition

after all interested parties were duly notified in accordance with La. R.S. 47:2275,

et seq, the trial court’s judgment sustaining PCOF’s Peremptory Exception of

Peremption is neither clearly wrong nor manifestly erroneous. Therefore, we

affirm the judgment as to the sustained Exception of Peremption.

Exception of Res Judicata

After the Lawrence heirs failed to redeem the property within the three-year

peremptive period, and after a valid and final judgment was issued granting

PCOF’s unopposed Petition for Monition, the Lawrence heirs brought an action to

annul both the monition judgment and the tax sale.

“The doctrine of res judicata precludes re-litigation of claims and issues

arising out of the same factual circumstances when there is a valid final judgment.”

BBCL Enterprises, LLC, 187 So.3d at 68 (citing Igbokwe v. Moser, 12–1366, p. 4

(La. App. 4 Cir. 4/24/13), 116 So.3d 727, 730). “It is designed to promote judicial

efficiency and final resolution of disputes.” Id. “[I]t is well established that on an

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exception of res judicata, the burden is on the exceptor to prove the essential

elements by a preponderance of the evidence.” Id.

La. R.S. 13:4231 states in pertinent part:

(2) If the judgment is in favor of the defendant, all causes of action
existing at the time of final judgment arising out of the transaction or
occurrence that is the subject matter of the litigation are extinguished
and the judgment bars a subsequent action on those causes of action.

(3) A judgment in favor of either the plaintiff or the defendant is
conclusive, in any subsequent action between them, with respect to
any issue actually litigated and determined if its determination was
essential to that judgment.

In Igbokwe, the Louisiana Supreme Court found that five elements must be present

for a party to prevail on its res judicata claim:

(1) the judgment is valid; (2) the judgment is final; (3) the parties are
the same; (4) the cause or causes of action asserted in the second suit
existed at the time of the final judgment in the first litigation; and (5)
the cause or causes of action asserted in the second suit arose out of
the transaction or occurrence that was the subject matter of the first
litigation.

Id. at 68 (citing Igbokwe, 12-1366, p. 5, 116 So.3d at 731).

The record indicates that each element required for PCOF to prevail on its

res judicata exception was present. The Lawrence heirs’ annulment action was

barred because the trial court’s monition judgment was valid, final, and between

the same parties. Furthermore, the causes of action asserted by the Lawrence heirs

existed at the time the monition judgment became final. At that time, the

Lawrence heirs could have appealed the judgment, sought to annul the monition,

and/or sought to annul the tax sale. None of these actions were taken. Instead, the

Lawrence heirs filed their action to annul the monition judgment and tax sale

nearly one month after the unopposed, final judgment was entered on the monition

petition and more than four years after the tax certificate was purchased by PCOF.

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Moreover, the Lawrence heirs’ annulment actions undeniably arose out the same

transaction or occurrence that was the subject matter of the monition judgment,

that action being PCOF’s purchase of the tax certificate and the filing of PCOF’s

Petition for Monition. Therefore, we find that the trial court’s judgment sustaining

PCOF’s Exception of Res Judicata is neither manifestly erroneous nor clearly

wrong. Accordingly, we affirm the judgment as to the sustained Exception of Res

Judicata.

Motion for Summary Judgment

Because we find that the trial court’s judgment sustaining PCOF’s

Exceptions of Peremption and Res Judicata was neither clearly wrong nor

manifestly erroneous, the trial court properly denied the Lawrence heirs’ Motion

for Summary Judgment on the annulment actions. The arguments made in the

Lawrence heirs’ Motion for Summary Judgment are either res judicata are

perempted, as indicated by the judgment sustaining PCOF’s Exceptions.

Therefore, we affirm the trial court’s judgment denying of the Lawrence heirs

Motion for Summary Judgment.

Lawrence Heirs’ Remaining Assignments of Error

Considering this Court’s findings, the Lawrence heirs’ remaining

assignments of error are moot and, as such, we decline any further discussion of

said errors.

CONCLUSION

For the foregoing reasons, we affirm the trial court’s November 10, 2021

judgment sustaining PCOF’s Exceptions of Peremption and Res Judicata, denying

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the Lawrence heirs’ Motion for Summary Judgment, and denying the Lawrence

heirs’ nullity actions with prejudice.

AFFIRMED

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