Stephen Lowell Druker v. Michael James Bertel, Full Sail Investments, LLC, 1100 Patterson, LLC and Bertel Construction, LLC

STEPHEN LOWELL DRUKER * NO. 2022-CA-0261

VERSUS *
COURT OF APPEAL
MICHAEL JAMES BERTEL, *
FULL SAIL INVESTMENTS, FOURTH CIRCUIT
LLC, 1100 PATTERSON, LLC *
AND BERTEL STATE OF LOUISIANA
CONSTRUCTION, LLC *******

APPEAL FROM
CIVIL DISTRICT COURT, ORLEANS PARISH
NO. 2021-02788, DIVISION “D”
Honorable Nakisha Ervin-Knott, Judge
******
Judge Rachael D. Johnson
******
(Court composed of Judge Joy Cossich Lobrano, Judge Rosemary Ledet, Judge
Rachael D. Johnson)

Charles L. Stern, Jr.
THE STEEG LAW FIRM, L.L.C.
201 St. Charles Avenue
Suite 3201
New Orleans, LA 70170

Richard L. Traina
THE STEEG LAW FIRM, LLC
201 Saint Charles Avenue, Suite 3201
New Orleans, LA 70170

COUNSEL FOR PLAINTIFF/APPELLANT

Will C. Griffin
Galante & Bivalacqua, LLC
650 Poydras Street
Suite 2615
New Orleans, LA 70130

Anna Lellelid
LOUISIANA COMMUNITY LAW OFFICE
2415 Bienville Street
New Orleans, LA 70119

Salvador I. Bivalacqua
GALANTE & BIVALACQUA LLC
650 Poydras Street
Suite 2615
New Orleans, LA 70130

COUNSEL FOR DEFENDANT/APPELLEE

AFFIRMED
December 5, 2022

RDJ Stephen Lowell Druker (“Mr. Druker”) seeks review of the trial court’s
JCL
November 30, 2021 judgment granting Full Sail Investments, LLC’s (“Full Sail”),
RML
motion for summary judgment. After consideration of the record before this Court

and the applicable law, we affirm the judgment of the trial court.

FACTS AND PROCEDURAL HISTORY

On March 10, 2020, Mr. Druker and Full Sail executed a Louisiana

Residential Agreement to Buy or Sell (the “Contract”) preparatory to the sale of

immovable property located at 1117 Patterson Road, New Orleans, Louisiana (the

“Property”). The Contract concerns the sale of a new home upon the completion

of its construction, with an original act of sale date of July 31, 2020, or earlier with

mutual written consent of the parties. The Louisiana Residential Agreement to

Buy or Sell contains an option for parties to include an addendum if the sale

involves the construction of a new home. Mr. Druker and Full Sail elected to

attach a New Construction Addendum to the Contract, along with several other

1

addenda, including an Addendum to Purchase Agreement, a Hurricane/Disaster

Addendum, and a Deposit Addendum.

The Addendum to Purchase Agreement contains the following provisions:

Seller shall notify Buyer in writing when Certificate of
Occupancy has been obtained, all construction is
complete and permanent utilities are in place at the
property. Buyer’s Due Diligence and Inspection period
shall commence at the time this notification is
communicated to the Buyer from the Seller.

Once the Due Diligence/Inspection period has
commenced, Buyer and Seller must go to the act of sale
for this property within 40 days from that date unless all
parties agree to extend this deadline in writing, or unless
the Buyer terminates the contract prior to the expiration
of the Due Diligence/Inspection period.

...

Architectural drawings and associated documents are for
reference only. The information contained within the
attached documents is intended to depict design and basic
construction detailing. The overall design of the
building, including it’s [sic] number of rooms, doors,
windows and their general placement shall be considered
the object of this contract by both the Seller and the
Buyer. Other than these main elements, Seller reserves
the right to deviate from construction documents at
Seller’s sole discretion without approval from Buyer.

Such deviations shall not be considered a breach of
contract on the part of the Seller. Buyer reserves the
right to cancel this agreement at any time prior to the
expiration of the Due Diligence/Inspection period and
shall be entitled to a full refund of the Deposit.

Additionally, the New Construction Addendum states:

Completion: Subject to any delays beyond the control of
Builder, such as inclement weather or other adverse
working conditions, fire or other casualty, riots, material
delivery delays or on account of any acts of God, the
home shall be completed on or before June 22, 2020
unless otherwise amended between parties. All changes

2

to construction or allowances shall be in writing and
signed by all parties.

Full Sail was not the builder of the new residence on the Property. Full Sail

contracted with Bertel Construction, LLC (“Bertel Construction”) to complete

construction of the home.1 Mr. Druker is not a party to the contract between Full

Sail and Bertel Construction, and Mr. Druker did not enter into any other

agreement with Bertel Construction.

It is undisputed that Bertel Construction experienced significant delays

during the course of construction. Pursuant to the terms of the Contract, the parties

mutually agreed in writing to extend the act of sale date on two separate occasions.

First, they agreed to an act of sale date of November 30, 2020, and they later

agreed to an act of sale date of March 30, 2021. Mr. Druker offered to extend the

act of sale date a third time, but Full Sail refused. Construction of the new home

was not completed by the March 30, 2021 act of sale date.

On March 22, 2021, Mr. Druker filed a petition for specific performance,

damages, and injunctive relief against Full Sail, Bertel Construction, Michael

Bertel (“Mr. Bertel”), and 1100 Patterson, LLC (“1100 Patterson”), (collectively,

“Defendants”). In his petition, Mr. Druker sought specific performance from

Defendants to complete construction of the new home. He also sought a

preliminary injunction to enjoin them from stopping construction on the new

residence. Mr. Druker alleged that he would suffer irreparable harm if the new

home was not completed and sought damages, attorney’s fees, and costs.

1 There is some ambiguity in the record as to the exact corporate entity with which Full Sail

contracted, as the New Construction Addendum of the Contract lists “Michael Bertel 110
Patterson, LLC,” as the builder of the residence.

3

On May 12, 2021, the trial court heard and denied Mr. Druker’s application

for preliminary injunction. On June 17, 2021, Druker filed an amended petition,

alleging fraud against Defendants.

On June 18, 2021, Full Sail filed a motion for summary judgment. Full Sail

argued that the Contract was unenforceable because it contained a suspensive

condition based solely on Mr. Druker’s whim. Alternatively, Full Sail asserted that

the Contract failed because both Full Sail and Mr. Druker were unable to perform

their respective conditional obligations on the March 30, 2021 act of sale date. As

to its own obligation, Full Sail alleged that it was unable, through no fault of its

own, to convey merchantable title of the new residence on the Property because

construction was incomplete on March 30, 2021. Concerning Mr. Druker’s

obligation, Full Sail further alleged that Mr. Druker was also unable to perform on

the March 30, 2021 act of sale date because he could not obtain financing for the

sale of the Property.

On September 22, 2021, Mr. Druker filed an opposition to Full Sail’s motion

for summary judgment. Mr. Druker subsequently filed a supplemental opposition

on November 4, 2021, after hiring new counsel. In his supplemental opposition,

Mr. Druker argued that summary judgment was inappropriate because it was

premature. Alternatively, Mr. Druker asserted that Full Sail’s motion for summary

judgment failed as a matter of law because: (1) Full Sail’s performance was not

excused due to impossibility of performance or force majeure; (2) Full Sail’s

interpretation of the Contract concerning its lack of enforceability due to a

suspensive condition based solely on Mr. Druker’s whim was incorrect; and (3)

Full Sail, likely motivated by a desire to sell the home for a higher price, breached

the Contract when it refused to extend the act of sale date for a third time.

4

On November 12, 2021, Full sail filed a reply. Full Sail argued that

summary judgment was proper and that it was entitled to judgment as a matter of

law because Mr. Druker failed to meet his burden of proof that there were any

genuine issues of material fact. Full Sail also contended that Mr. Druker

mischaracterized Full Sail’s arguments in discussing impossibility of performance

and force majeure, as Full Sail never raised those legal arguments in its motion for

summary judgment. Rather, Full Sail asserted that “the conditions in the

[Contract] simply failed through no fault of either party.” Next, Full Sail argued

that the express language of the Contract allowed Mr. Druker to cancel the

Contract at any time subject to his whim and that the Contract is therefore null and

unenforceable. Moreover, Full Sail contended that Full Sail did not have a duty to

extend the Contract a third time because the plain language of the Contract

required mutual written consent for any changes to the act of sale date. Finally,

Full Sail asserted that there was no need for parol evidence because the language

of the Contract is unambiguous.

A hearing on the motion for summary judgment was held on November 19,

2021. The trial court concluded:

Article 770 of the Louisiana Civil Code states in
pertinent part, “ . . . a suspensive condition that depends
solely on the whim of the obligor makes the obligation
null.” The [Contract] contained the following language:
“Buyer reserves the right to cancel this agreement at any
time prior to the expiration of the due
diligence/inspection period and shall be entitled to a full
refund of the deposit.”

So the Louisiana Real Estate Commission provides a
mandatory form for Louisiana residential agreements to
buy or sell which contain a due diligence period to
provide the buyer an opportunity to terminate the
[Contract] if he or she chooses. The decision to
terminate is presumed to be based on facts found during

5

the physical inspection of the property and can be
exercised only during the limited inspection period. Now
in this case, this agreement . . . altered the typical due
diligence clause to allow Mr. Druker to cancel the
agreement at any time prior to the expiration of the due
diligence inspection period. The agreement provides for
a due diligence . . . period of 14 days, and this period is
identical to the due diligence period provided for in the
LREC’s mandatory form. However, the due diligence
period does not begin until after [Full Sail] obtains a
certificate of occupancy, which is explained in the
Addendum to the Purchase Agreement, which means that
Mr. Druker can cancel the agreement at any time before
the 14-day due diligence period begins, and his
cancellation does not have to depend on the home not
passing inspection or unacceptable deviations. Under the
agreement, Mr. Druker can cancel without any valid
reason before the due diligence period.

As such, looking at all of this and considering the
arguments of Mr. Traina, Mr. Druker can cancel without
any valid reason before the due diligence period, and I
find that the agreement is unenforceable because the
suspensive condition based on the whim of Mr. Druker
renders the agreement null in accordance with
[Louisiana] Civil Code Article 770. So for the reasons
I’ve outlined, the Motion for Summary Judgment is
hereby granted.

DISCUSSION

Mr. Druker’s Assignment of Error

On appeal, Mr. Druker’s sole assignment of error is that the trial court erred

in granting Full Sail’s motion for summary judgment. Mr. Druker first argues that

had the trial court properly followed Louisiana’s rules of contract interpretation, it

would have concluded that the parties intended that Mr. Druker would have only

been able to cancel the Contract during the Due Diligence/Inspection period.

Second, Mr. Druker contends that the Addendum to Purchase Agreement contains

a resolutory condition and not a suspensive condition. Third, Mr. Druker asserts

that even assuming arguendo that the Addendum to Purchase Agreement contains

6

a suspensive condition, Mr. Druker could only cancel the Contract in good faith

and based on his will as opposed to his whim.

Full Sail argues that the trial court correctly granted its motion for summary

judgment because the Contract between Full Sail and Mr. Druker failed as a matter

of law. Full Sail further argues that the Contract “expired without penalty because

the suspensive conditions therein failed.” In the alternative, Full Sail contends that

the Contract was unenforceable as written because Mr. Druker could cancel the

Contract solely on his whim.

Standard of Review

“Appellate courts review the grant or denial of a motion for summary

judgment de novo, using the same criteria applied by trial courts to determine

whether summary judgment is appropriate.” Chatelain v. Fluor Daniel Const. Co.,

14-1312, p. 3 (La. App. 4 Cir. 11/10/15), 179 So.3d 791, 793 (quoting Mandina,

Inc. v. O’Brien, 13-0085, p. 9 (La. App. 4 Cir. 7/31/13), 156 So.3d 99, 104-05).

The standard for granting a motion for summary judgment is set forth in La. C.C.P.

art. 966(A)(3), which provides that, “[a]fter 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). Generally, the burden of proof on a motion for summary judgment lies

with the mover. La. C.C.P. art. 966(D)(1). If the moving party “will not bear the

burden of proof on the issue that is before the court on the motion for summary

judgment,” however, then the mover need only “point out to the court the absence

of factual support for one or more elements essential to the adverse party’s claim,

action, or defense.” Id. The burden of proof remains on the “adverse party to

7

produce factual support sufficient to establish the existence of a genuine issue of

material fact or that the mover is not entitled to judgment as a matter of law.” Id.

If the non-moving party fails to do so, then summary judgment will be granted.

Failure of the Contract

A contract is defined as “an agreement by two or more parties whereby

obligations are created, modified, or extinguished.” La. Civ. Code. art. 1906. The

Contract at issue is a bilateral commutative contract. “A contract is bilateral, or

synallagmatic, when the parties obligate themselves reciprocally, so that the

obligation of each party is correlative to the obligation of the other.” La. Civ.

Code art. 1908. “A contract is commutative when the performance of the

obligation of each party is correlative to the performance of the other.” La. Civ.

Code art. 1911. Specifically, the Contract is an agreement preparatory to a sale.

“An agreement whereby one party promises to sell and the other promises to buy a

thing at a later time, or upon the happening of a condition, or upon some

performance of some obligation by either party, is a bilateral promise of sale or

contract to sell.” La. Civ. Code art. 2623. An agreement preparatory to a sale

“gives either party the right to demand specific performance” and “must set forth

the thing and the price, and meet the formal requirements of the sale it

contemplates.” Id.

The Contract at issue contains conditional obligations. “A conditional

obligation is one dependent on an uncertain event. If the obligation may not be

enforced until the uncertain event occurs, the condition is suspensive. If the

obligation may be immediately enforced but will come to an end when the

uncertain event occurs, the condition is resolutory.” La. Civ. Code art. 1767. “A

suspensive condition that depends solely on the whim of the obligor makes the

8

obligation null. A resolutory condition that depends solely on the will of the

obligor must be fulfilled in good faith.” La. Civ. Code art. 1770. “If the condition

is that an event shall occur within a fixed time and that time elapses without the

occurrence of the event, the condition is considered to have failed.” La. Civ. Code

art. 1773.

“Contracts have the effect of law and may be dissolved only through the

consent of the parties or on grounds provided by law. Contracts must be

performed in good faith.” La. Civ. Code art. 1983. “Interpretation of a contract is

the determination of the common intent of the parties.” La. Civ. Code art. 2045.

“When the words of a contract are clear and explicit and lead to no absurd

consequences, no further interpretation may be made in search of the parties’

intent.” La. Civ. Code art. 2046. “Each provision in a contract must be interpreted

in light of the other provisions so that each is given the meaning suggested by the

contract as a whole.” La. Civ. Code art. 2050. “The interpretation of a contract’s

provisions is typically a matter of law that properly may be decided on motion for

summary judgment.” Iteld v. Four Corners Const., L.P., 12-1504, p. 15 (La. App.

4 Cir. 6/5/13), 157 So.3d 702, 713 (citing Hall v. Malone, 12-0264, pp. 4-5 (La.

App. 4 Cir. 11/7/12), 104 So.3d 593, 596. “The interpretation of a contract is

normally a question of law.” Id., p. 16, 157 So.3d at 714 (citing Brown v. Drillers,

Inc., 93-1019 (La. 1/14/94), 630 So.2d 741, 749-50.

The principal obligations of each party in the Contract at issue were

conditioned upon uncertain events. More specifically, they both contained

suspensive conditions. Full Sail’s obligation to convey merchantable title was

conditioned upon the completion of construction of the new home, and Mr.

Druker’s obligation to purchase the Property was conditioned upon his ability to

9

obtain financing. As to Mr. Druker’s obligation, this Court has previously

determined that an obligation to purchase immovable property conditioned upon a

buyer’s ability to obtain financing is a suspensive condition. Rousset v. Smith, 14-

1409, p. 9 (La. App. 4 Cir. 9/23/15), 176 So.3d 632, 639; Kansas v. Schaeffer, 299

So.2d 474, 476 (La. App. 4th Cir. 1974); Treadaway v. Piazza, 156 So.2d 328, 330

(La. App. 4th Cir. 1963) (“It is well-settled that an agreement to purchase an

immovable, conditioned upon purchaser’s ability to obtain a stipulated loan to

finance the purchase, is a contract subject to a suspensive condition.”). Similarly,

Full Sail’s obligation to sell the Property was conditioned upon the suspensive

condition of the completion of construction of the new home in advance of the

March 30, 2021 act of sale date. It is undisputed that construction of the new home

on the Property was incomplete on the March 30, 2021 act of sale date.

Accordingly, the suspensive condition failed. Even assuming arguendo, as the

trial court assumed, that Mr. Druker was able to obtain financing to purchase the

Property, Full Sail could not fulfill its obligation to sell a newly-constructed home

on the March 30, 2021 act of sale date because the suspensive condition that

construction would be finished failed.

This Court has held that when a party to a purchase agreement cannot fulfill

an obligation due to the failure of a suspensive condition by no fault of the

obligated party, the purchase agreement is null. Bacon v. Ford, 522 So.2d 1232,

1234-35 (La. App. 4th Cir. 1988) (“When a purchaser, through no fault of his own,

is unable to obtain the loan upon which the agreement is conditioned, the

obligations imposed by the agreement are not binding upon the parties; the

agreement is null and the parties are released from their obligations to perform.”);

Rousset, 14-1409, p. 29, 176 So.3d at 649. (“Given the trial judge’s finding that the

10

[buyers] were unable, through no fault of their own, to secure financing by the date

set for the act of sale, her conclusion that the purchase agreement was thus

rendered null should not be controversial. It is . . . the only legal conclusion.”).

Full Sail repeatedly asserts that the construction delays were through no fault of its

own. Mr. Druker, on the other hand, contends that “[f]act issues exist as to the

reasons for the delays and whether the delays could have been avoided.” Even

assuming arguendo that some of the delays could have been avoided, there is no

evidence in the record that Full Sail, which was not the builder of the new home,

was at fault for Bertel Construction’s failure to complete construction in advance

of the March 30, 2021 act of sale date. Accordingly, we find that the trial court

correctly concluded that the Contract failed and is null.

Enforceability of the Contract

Mr. Druker contends that the trial court erred in concluding that he could

cancel the Contract at any time prior to the expiration of the Due

Diligence/Inspection period and that the “unambiguous language of the Contract

and its addenda shows that the right only existed between the commencement and

the expiration” of the Due Diligence/Inspection period.” Based on this

interpretation, Mr. Druker further argues that his right to cancel the Contract is a

resolutory condition and that, even if it were a suspensive condition, Mr. Druker

could only cancel the Contract based on his will and not on his whim. We

disagree. The plain language of the Addendum to Purchase Agreement provides

that Mr. Druker “reserves the right to cancel this agreement at any time prior to the

expiration of the date of the Due Diligence/Inspection period and shall be entitled

to a full refund of the deposit.” Accordingly, we find no support for Mr. Druker’s

11

assertion that he could only cancel the Contract within the Due

Diligence/Inspection period.

We agree with the trial court that the Contract was “unenforceable because

the suspensive condition based on the whim of Mr. Druker renders the agreement

null.” In McCall v. Focus Worldwide Television Network, Inc., this Court

concluded that an employment contract with modified terms to allow an employee

to continue her work at a company for as long as she wanted contained a

suspensive condition based solely on her whim that rendered the agreement null

pursuant to La. Civ. Code art. 1770. 12-0742, pp. 19-20 (La. App. 4 Cir. 6/12/13),

119 So.3d 876, 887. Similarly, the Contract at issue modified the standard terms

of the Louisiana Residential Agreement to Buy or Sell, which provides a 14-day

Due Diligence/Inspection period to allow the Buyer to cancel the agreement based

on facts ascertained during that 14-day period, such as construction defects or a

failed inspection, to allow Mr. Druker to cancel “at any time,” even prior to the

commencement of the Due Diligence/Inspection period. This effectively turned

Mr. Druker’s ability to cancel from a permissible suspensive condition based on

his informed decision making, or his will, arising from facts discovered during the

Due Diligence/Inspection period, into a suspensive condition dependent solely on

his whim because the express language of the Addendum to Purchase Agreement

allows him to cancel based on his unbridled discretion even in advance of the start

of the Due Diligence/Inspection Period. Accordingly, we find that the trial court

correctly determined that the Contract permits Mr. Druker to cancel “without any

valid reason” prior to the commencement of the Due Diligence/Inspection period

and is therefore a suspensive condition based solely on his whim that renders the

Contract null.

12

DECREE

For the reasons stated above, we affirm the trial court’s ruling finding that

there are no genuine issues of material fact regarding the validity and

enforceability of the Contract and that Full Sail is entitled to judgment as a matter

of law.

AFFIRMED

13