Ttv, LLC v. David B. Simmons

STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT

10-1163

TTV, L.L.C.

VERSUS

DAVID B. SIMMONS

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APPEAL FROM THE
FIFTEENTH JUDICIAL DISTRICT COURT
PARISH OF LAFAYETTE, NO. C-2007-5954
HONORABLE EDWARD BROUSSARD, DISTRICT JUDGE

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JIMMIE C. PETERS
JUDGE

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Court composed of John D. Saunders, Oswald A. Decuir, and Jimmie C. Peters,
Judges.

AFFIRMED IN PART, REVERSED IN PART, AND RENDERED.

Lamont P. Domingue
Voorhies & Labbe
P. O. Box 3527
Lafayette, LA 70502
(337) 232-9700
COUNSEL FOR PLAINTIFF/APPELLANT:
TTV, L.L.C.

David A. Lowe
Keegan, Denicola, Kiesel,
Bagwell, Juban & Lowe, LLC
5555 Hilton Avenue
Suite 205
Baton Rouge, LA 70808
(225) 364-3600
COUNSEL FOR DEFENDANTS/APPELLEES:
David B. Simmons
Wrightwood Construction, L.L.C.

PETERS, J.

TTV, L.L.C. (TTV), a Louisiana limited liability company, brought suit against

David B. Simmons and Wrightwood Construction, L.L.C. (Wrightwood

Construction), another Louisiana limited liability company, to recover certain funds

it had paid to the defendants pursuant to a services and construction agreement

entered into by the litigants. TTV appeals the trial court judgment rejecting its

claims. For the following reasons, we affirm the trial court’s rejection of TTV’s

claims against Wrightwood Construction but reverse the trial court’s rejection of its

claims against Mr. Simmons and render judgment in favor of TTV and against Mr.

Simmons in the amount of $112,421.00.

DISCUSSION OF THE RECORD

In September of 2004, TTV acquired a thirty-year old apartment complex in

Baton Rouge, Louisiana. In the Spring of 2007, Glenn Stewart, TTV’s principal

owner and general manager, was involved in building a new apartment complex in

Lafayette, Louisiana. The contractor in the Lafayette project was Julian LeCraw

Construction Company (LeCraw Construction), and David B. Simmons was LeCraw

Construction’s project manager for the Lafayette project. During this time TTV

decided to renovate the Baton Rouge apartment complex and convert it into a facility

to be known as Tiger Manor Condominiums.

In the Spring of 2007, and before any renovation and remolding activity was

performed on the Baton Rouge property, Mr. Stewart approached LeCraw

Construction’s president, Steven Hendricks, and offered his company the opportunity

of performing the work on the Tiger Manor project. Mr. Hendricks declined the

opportunity, but offered to loan Mr. Simmons to TTV as a consultant on the Tiger

Manor project. However, the loan of Mr. Simmons’ services was to be limited to the

time he was not involved in activities for LeCraw Construction. In fact, LeCraw

Construction continued to pay Mr. Simmons’ salary through August 28, 2007, and

billed TTV $4,550.00 for Mr. Simmons’ consulting services between May 18 and

July 18, 2007.1

With nothing more than an understanding that LeCraw Construction was

loaning Mr. Stewart to TTV as a consultant, Mr. Stewart and Mr. Simmons began

working together in earnest in June of 2007. At that point, they were involved in

choosing floor finishes, deciding on cabinet options, establishing budgets for the

remodeling projects, and acquiring permits. TTV’s initial goal was to quickly

complete two model units at Tiger Manor for use in promoting sales and rentals.

The first direct reference to funding of the Tiger Manor project found in the

record is a June 11, 2007 e-mail from Mr. Simmons to Mr. Stewart wherein he noted

that “[w]e will also need to arrange for some funding this week so I can keep things

moving.” Three days later, on June 14, 2007, Mr. Stewart issued Mr. Simmons a

$25,000.00 check. This was followed by two additional $25,000.00 checks from Mr.

Stewart to Mr. Simmons—one issued on June 20, 2007, and the other on June 27,

2007. On July 12, 2007, Mr. Stewart issued a $50,000.00 check to Mr. Simmons.2

Six days after receiving the last check, on July 18, 2007, Mr. Simmons e-

mailed Mr. Stewart a detailed budget for the entire renovation project. The bottom

line of that budget reflected a projected cost of construction of $6,827,966.00. The

cover letter attached to the transmitted budget discussed some possible changes and

1
This represented seven days of consulting services at $650.00 per day.
2
At trial Mr. Stewart testified that TTV reimbursed him for the $125,000.00 he spent on its
behalf.

2

raised questions concerning certain categories before closing with the following

discussion of the startup costs:

Here is a basic breakdown on the money paid to date . . . . .
I will have a very detailed one put together for you when you return ...
There are two bid deposits that need to go out while you are gone to
keep the granite and windows moving . . . .
Mobilization 25K
Permits 25K
License 28K
General Conditions 50K
Model Units (2) 44K
Next 10 units @ 25% 50K
Deposits
Granite 40K
Windows 75K
Total 337K
Paid 125K
Balance 212K
Let me know if you need the account number to transfer funds or you
can leave a check with someone and I will have it picked up which ever
is easier for you . . . . . Just let me know

As the e-mail reflects, Mr. Simmons drew no distinction between what had been paid

by the $125,000.00 he had received and what was to be paid. At best, the e-mail

purports to establish the estimated costs for the completion of the two model units and

the first ten units thereafter.

The first reference to Wrightwood Construction comes in a July 27, 2007 e-

mail sent by Mr. Simmons to Mr. Stewart wherein he sent a second copy of the cover

letter to the proposed budget and stated:

This is a copy of the email I sent to you before you left on the money
status....
Like I told you if you want to wait on the deposits that is fine but need
the other to keep things moving ...
You can make this and all future payments to Wrightwood Construction,
LLC. I can have the check picked up in Lafayette or it can be delivered
to Baton Rouge and given to Sam [the on-site manager]. I will be back
on site Sunday and most of next week ....
Just let me know....

3

That same day Mr. Simmons sent Mr. Stewart another e-mail that stated:

We have the permits for the model units ....
The others should follow very soon....
I have everyone scheduled to put the models together the correct way....
Plumber is working this weekend and the Electrician will be there in
force on Monday...
I will push everyone as much as possible so we can have these
completed as soon as possible. Hopefully early week of the 6th...

Apparently in response to these e-mails, TTV issued a check made payable to

Wrightwood Construction for $212,000.00 on July 30, 2007.

In the meantime, the project continued to move forward. According to Mr.

Stewart, by the end of July 2007, he had worked with an architect to help TTV obtain

its building permits; had hired everyone working on the site; had helped select all of

the options for the condominiums, including kitchen appliances, finishes, and lighting

packages; had overseen the demolition work on forty-five of the preexisting units;

and had almost completed the two model units.

The two model units were completed some time around the first week in

August of 2007. On August 20, 2007, Mr. Stewart e-mailed Mr. Simmons reporting

that the open house involving the two model units had been well received. In the e-

mail, he thanked Mr. Simmons for his “hard work,” and noted that Mr. Simmons had

“certainly delivered as [he had] promised!” The following day, August 21, 2007, Mr.

Simmons e-mailed Mr. Stewart concerning the plans to paint the buildings and install

shutters and windows, as well as plans for clubhouses, playgrounds, and a basketball

court. The next week was Mr. Simmons’ last day on LeCraw Construction’s payroll.

Despite the fact that Mr. Simmons had begun to work full-time with and/or for

TTV, the parties still had no written agreement. However, the new relationship had

a short life. In mid-September relations between Mr. Stewart and Mr. Simmons

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began to deteriorate because Mr. Simmons ignored Mr. Stewart’s repeated e-mail

efforts to obtain an accounting of the money already paid to Mr. Simmons and

Wrightwood Construction—and to get a response to his dissatisfaction with the

progress of the project.

On September 26, 2007, TTV took steps to terminate its relationship with Mr.

Simmons and Wrightwood Construction. Mr. Stewart had the locks changed at the

project office and secured the contents thereof. According to Mr. Stewart, between

the time the two models were completed and September 26, 2007, essentially no work

was performed at Tiger Manor.

TTV filed suit against Mr. Simmons and Wrightwood Construction on

November 5, 2007, alleging that the defendants had improperly diverted the

$337,000.00 it had disbursed between June 14 and August 3, 2007, to Mr. Simmons’

personal use. Mr. Simmons and Wrightwood Construction answered the suit and

reconvened for damages for breach of contract, unjust enrichment, quantum meruit,

and defamation.

With this factual background, the trial court was required to determine the

nature of the agreement or agreements among the parties to the litigation and to trace

the $337,000.00 at issue. With regard to the first issue, the only uncontested part of

that determination was that LeCraw Construction loaned Mr. Simmons’ services to

TTV with the understanding that LeCraw Construction would continue to pay Mr.

Simmons.

With regard to the relationships among the parties, Mr. Stewart testified that

initially he expected Mr. Simmons to be a consultant and facilitator who would help

TTV obtain its permits, select a general contractor, and provide advice on how to

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convert the thirty-year-old apartment buildings into condominiums. According to Mr.

Stewart, these services were to be performed by Mr. Simmons without compensation

because he [Mr. Simmons] was on loan from LeCraw Contractors and was being paid

by that entity for the very services for which Mr. Simmons now seeks compensation.

When the Tiger Manor project began, Mr. Stewart did not anticipate that Mr.

Simmons would be a candidate for the general contractor position, but he testified

that as early as June 3, 2007, he realized that Mr. Simmons “wanted to take over the

whole project and be the general contractor and do everything. And he explicitly

made that clear to me when he went over the June 15th budget.” According to Mr.

Stewart, the terms of the proposed budget reflected a profit margin for the general

contractor of $500.00 per unit for each of the 300 projected units, or a maximum of

$150,000.00. Mr. Stewart testified that his understanding early in June of 2007 was

that Mr. Simmons would form a construction company, obtain his contractor’s

license, and undertake the remodeling project for the contemplated profit of $500.00

per unit.

Mr. Simmons, on the other hand, testified that the $500.00 per unit profit,

totaling $150,000.00, was to compensate him for his consulting activities in setting

up the project. According to Mr. Simmons, he had earned his $150,000.00 consulting

fee when the two model units were completed. When the original general contractor

did not work out, he formed his own construction company and, only then did he

become the general contractor for that job. In other words, Mr. Simmons argues that

there were actually two different agreements with TTV—the first was a personal one

for his consultant services that he completed and for which he was entitled to the

agreed-upon compensation of $150,000.00; and the second was between TTV and

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Wrightwood Construction for which he and/or Wrightwood Construction were

entitled to a separate compensation.3

The trial court rendered judgment rejecting both the original claim and the

reconventional demand and effectively left the parties in a status quo situation. In its

written reasons for judgment, the trial court stated in pertinent part:

The evidence fails to sustain plaintiff’s burden of proof that any
funds were misappropriated. No builders or suppliers testified that any
funds were due them. As stated in defendants[sic] post-trial
memorandum, “plaintiff failed to produce one single invoice or bill that
it had to pay because Simmons and/or Wrightwood failed to pay it.”
The plaintiff’s claim for damages is denied.

Defendants were terminated prior to the project being finished.
They were to have been paid One Hundred Fifty Thousand Dollars
($150,000.00), collectively, for their work. They received One Hundred
Twenty-Five Thousand Dollars ($125,000.00). This court cannot say
that they were either underpaid or overpaid. Defendants may retain the
portion of the fee collected, but will not be granted the additional
Twenty-Five Thousand Dollars ($25,000.00) because the project was
not finished at the time of their termination.

In its five assignments of error, TTV basically raises one issue: whether the

trial court erred in rejecting its claims for conversion, breach of contract, fraud,

breach of fiduciary duty, and intentional interference with a contract because TTV

failed to produce evidence of unpaid builders or suppliers.

OPINION

TTV did not appeal the portion of the trial court judgment finding that the

agreement between Mr. Simmons and Mr. Stewart provided for Mr. Simmons and/or

Wrightwood Construction to be paid a total of $150,000.00 for their role in the Tiger

Manor project, nor did it appeal the $125,000.00 partial award for that role.

However, the trial court’s reasons for judgment implicitly reject Mr. Simmons’

3
Mr. Simmons never testified concerning what he understood his compensation to be as
general contractor.

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assertion that he was to be paid $150,000.00 for services rendered as a consultant

setting up the project and that Wrightwood Construction was to be paid another,

unspecified, fee for its work during the renovation and construction phase. While the

correctness of this determination plays only a peripheral part in our analysis and is not

directly before us on appeal, we do note that this determination is supported by the

record—particularly the July 18, 2007 e-mail wherein the cover letter made no

mention of the purported $150,000.00 consultant fee. In fact, the only reference in

that document to the margin of profit is in the budget, which provides for a $500.00

payment for each of the 300 units completed. Additionally, it is not disputed that Mr.

Simmons began his involvement with the Tiger Manor project as a loaned employee

from LeCraw Construction or that his employer had continued to pay his normal

salary while he was working on the Lafayette, Louisiana, TTV project and had billed

TTV for what it understood to be Mr. Simmons’ efforts in Baton Rouge.

TTV claims the right to recover under six different legal theories, and in each

assignment of error asserts that the trial court erred in rejecting its claim based on it

failure to produce evidence of unpaid builders or suppliers. We agree.

The issue before the court was whether Mr. Simmons and/or Wrightwood

Construction improperly diverted funds placed in their trust to Mr. Simmons and,

while TTV may have had to pay expenses associated with the Tiger Manor project

that should have been paid with the funds distributed to Mr. Simmons and/or

Wrightwood Construction, that is not an element of its proof to establish that Mr.

Simmons and/or Wrightwood Construction improperly diverted funds placed in their

trust. The trial court erred as a matter of law in requiring TTV to produce evidence

of unpaid builders or suppliers. That being the case, and because the record before

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us is complete, we will consider the merits of the legal theories espoused by TTV

under the de novo standard of review. Evans v. Lungrin, 97-541, 97-577 (La. 2/6/98),

708 So.2d 731.

In performing the de novo review of the matter before us, we find it necessary

to consider only one of the legal theories—breach of a fiduciary duty. “As a basic

proposition, for a fiduciary duty to exist, there must be a fiduciary relationship

between the parties.” Scheffler v. Adams and Reese, L.L.P., 06-1774, p. 6 (La.

2/22/07), 950 So.2d 641, 647. The Louisiana Uniform Fiduciaries Law, La.R.S.

9:3801-3814, defines a fiduciary as follows:

“Fiduciary” includes a trustee under any trust, expressed, implied,
resulting or constructive, executor, administrator, guardian, conservator,
curator, receiver, trustee in bankruptcy, assignee for the benefit of
creditors, partner, agent, officer of a corporation, public or private,
public officer, or any other persons acting in a fiduciary capacity for any
person, trust or estate.

La.R.S. 9:3801(2).

Additionally, a corporation can be a fiduciary. La.R.S. 9:3801(3). As pointed out by

the supreme court, “[t]he defining characteristic of a fiduciary relationship, therefore,

is the special relationship of confidence or trust imposed by one in another who

undertakes to act primarily for the benefit of the principal in a particular endeavor.”

Scheffler, 950 So.2d at 648.

The existence of a “special relationship of confidence or trust” between Mr.

Simmons and Mr. Stewart was clearly demonstrated at trial. In his testimony

concerning the relationship he created as a consultant for TTV, Mr. Simmons stated:

He [Mr. Stewart] told me that he needed assistance putting it
together. He did not know construction. He knew my background and
felt comfortable with my knowledge and felt like I could assist him
greatly in putting this project together. And we discussed it and came
to an agreement that I would do the set up on the project for him.

9

When describing Mr. Simmons’ role in the project, Mr. Stewart stated:

He [Mr. Simmons] was going to be the general contractor. I
mean, he was going to do the whole thing. You know, I didn’t know
anything about construction really. And he was going to get the permits,
get all the subs lined up. I mean, he was running the show.

Even Mr. Simmons’ argument in his brief to this court supports the special

relationship of trust and confidence, as it stated:

Specifically, [TTV] told Simmons that he needed help putting the
Project because [TTV] had no construction experience. [TTV]
discussed this opportunity with him because [TTV] knew Simmons’
background, felt comfortable with Simmons’ construction knowledge,
and felt like Simmons could greatly assist [TTV] in putting the Project
together. At that time, Simmons had over thirty (30) years of experience
in the construction industry . . . .

[Citations to the record omitted.]

The trust that TTV and Mr. Stewart placed in Mr. Simmons is further evidenced by

the fact that the entire relationship regarding the expenditure of the $337,000.00

existed without a written contract and was evidenced by nothing more than a cover

letter to an e-mail.

A fiduciary must handle the manner entrusted to him “as though it were his

own affair.” Noe v. Roussel, 310 So.2d 806, 819 (La.1975). The fiduciary “may not

take even the slightest advantage, but must zealously, diligently and honestly guard

and champion the rights of his principal against all other persons whomsoever, and

is bound not to act in antagonism, opposition or conflict with the interest of the

principal to even the slightest extent.” Id. at 819. To establish a cause of action for

breach of fiduciary duty, the plaintiff must prove fraud, breach of trust, or some

action outside the limits of the fiduciary’s duty. Sampson v. DCI of Alexandria, 07-

671 (La.App. 3 Cir. 10/31/07), 970 So.2d 55. We find that TTV established both of

the last two elements.

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The record establishes that the $337,000.00 at issue is the exact amount

requested by Mr. Simmons in his cover letter to the July 18, 2007 e-mail; that Mr.

Stewart, acting on behalf of TTV, paid $125,000.00 of that amount directly to Mr.

Simmons before Wrightwood Construction came into existence; and that TTV paid

the remaining $212,000.00 to Wrightwood Construction pursuant to Mr. Simmons’

instruction. However, because the payments were made to separate entities, they

must be considered separately.

The record also establishes that of the initial $125,000.00, which was paid

directly to Mr. Simmons, only $12,579.00 was used for the benefit the Tiger Manor

project.4 Additionally, the trial court rejected Mr. Simmons’ argument that he was

entitled to a separate $150,000.00 consulting fee in addition to his salary from his

direct employer. Thus, we find that Mr. Simmons breached his fiduciary duty to TTV

by diverting the remaining $112,421.00 directly to his benefit.

The remaining $212,000.00 paid to Wrightwood Construction presents a

different situation entirely. This amount arises from the second contract affecting the

project. It was not between TTV and Mr. Simmons, but between TTV and

Wrightwood Construction, and Wrightwood Construction was to make a profit of

$500.00 per unit for every one of the 300 units completed under the contract. Thus,

although in its reasons for judgment the trial court seemed to award the previously

claimed compensation to both Mr. Simmons and Wrightwood Construction, it is clear

that Wrightwood Construction is the proper entity to receive credit for that amount.5

4
Mr. Simmons paid $3,680.00 to Patrick Davis, a contractor working on the project;
$3,200.00 to Sandra O’Brian, Mr. Simmons’ sister, whom he hired to serve as project manager; and
$5,699.00 for cabinets to be installed in the units.
5
The trial court judgment itself does not mention the $125,000.00 issue. Instead, it simply
states that all claims of both David B. Simmons and Wrightwood Construction “against TTV, L.L.C.
and Glenn Stewart are denied with prejudice.”

11

The record establishes that Wrightwood Construction paid $125,725.64 for the

benefit of the Tiger Manor project and paid the remainder, $86,274.36, to Mr.

Simmons directly. When proper interpretation is given to trial court reasons for

judgment, the amount paid to Mr. Simmons represents part of the $125,000.00 fee.6

We find that Wrightwood Construction is not indebted to TTV and the trial court did

not err in dismissing TTV’s claims against Wrightwood Construction.

DISPOSITION

For the foregoing reasons, we reverse the trial court’s judgment to the extent

that it dismissed TTV, L.L.C.’s claims against David B. Simmons and award

judgment in favor of TTV, L.L.C. and against David B. Simmons, in the amount of

$112,421.00. We affirm the trial court’s rejection of TTV, L.L.C.’s claims against

Wrightwood Construction, L.L.C. We assess all costs of this appeal to David B.

Simmons.

AFFIRMED IN PART, REVERSED IN PART, AND RENDERED.

6
Wrightwood Construction did not appeal the trial court’s failure to award it an additional
balancing sum. We note that in their reply brief, the defendants attempt to argue that the trial court
erred in denying Mr. Simmons’ claims for breach of contract, lien, and defamation. However,
neither defendant filed an answer to the appeal, as required under La.Code Civ.P. art. 2133. Filing
a brief does not satisfy the article’s requirements. Brewington v. La. Dep’t of Corr., 447 So.2d 1184
(La.App. 3 Cir. 1984), writ denied, 449 So.2d 1348 (La.1984). Accordingly, we do not address those
issues.

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