Tri-Lake of Louisiana, LLC v. Couteau Plateau, LLC

STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT

10-1384

TRI-LAKE OF LOUISIANA, LLC, ET AL.

VERSUS

COUTEAU PLATEAU, LLC

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APPEAL FROM THE
THIRTY-EIGHTH JUDICIAL DISTRICT COURT
PARISH OF CAMERON, NO. 10-18350
HONORABLE PENELOPE Q. RICHARD, DISTRICT JUDGE

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MARC T. AMY
JUDGE

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Court composed of Marc T. Amy, Shannon J. Gremillion, and Phyllis M. Keaty,
Judges.

AFFIRMED.

Steven Broussard
Broussard & Hart, LLC
1301 Common Street
Lake Charles, LA 70601
(337) 439-2450
COUNSEL FOR DEFENDANT/APPELLANT:
Couteau Plateau, LLC

Thomas J. Gayle
Gayle Law Firm
Post Office Box 3190
Lake Charles, LA 70602-3190
(337) 494-1220
COUNSEL FOR PLAINTIFFS/APPELLEES:
Tri-Lake of Louisiana, LLC
Wilson LeJeune

AMY, Judge.

The plaintiffs filed suit seeking the return of the purchase price of a mobile

home. The defendant alleged that the underlying contract was valid and that the risk

of loss for the destruction of the mobile home fell on the purchaser. After trial, the

trial court entered judgment in favor of the plaintiffs and awarded the purchase price

of the mobile home. The defendant appeals. For the following reasons, we affirm.

Factual and Procedural Background

The defendant, Couteau Plateau, LLC, owns a camp in Cameron Parish.

According to Frank Sadler, a manager/member of Couteau Plateau, the camp was

destroyed by Hurricane Rita in 2006. Sadler testified that he arranged for the

purchase of a mobile home to be used as a temporary camp while the permanent

structure was being rebuilt. In the summer of 2008, Couteau Plateau decided to sell

the mobile home.

Tri-Lake of Louisiana, LLC and Wilson LeJeune, plaintiffs, were interested in

purchasing a mobile home. LeJeune is a manager/member of Tri-Lake. LeJeune

testified that, after he viewed the mobile home, Tri-Lake agreed to purchase it. The

parties signed the bill of sale and the title on August 22, 2008 and LeJeune tendered

twenty-five thousand dollars as the purchase price. LeJeune testified that he

attempted to have the mobile home titled in Tri-Lake’s name on August 26, 2008.

According to his testimony, he learned that, in addition to other defects, significant

taxes were owed on the defendant’s original purchase of the mobile home.

LeJeune alleges that he contacted Sadler about the outstanding taxes and the

parties disputed whether or not taxes were owed on the purchase. According to

Sadler, he offered LeJeune a refund of the purchase price and LeJeune refused.

According to LeJeune, the matter was left “up in the air.” Sadler then left the country

on September 8, 2008 for an extended vacation. Before Sadler returned, Hurricane

Ike made landfall on September 12, 2008, and the mobile home was destroyed by its

flood waters.

The plaintiffs filed suit, seeking the return of the purchase price due to a mutual

mistake in the price. After a trial, the trial court entered judgment in the plaintiffs’

favor and awarded the contract price to the plaintiffs. The defendant appeals,

asserting the following assignments of error:

No. 1 - The trial court erred in failing to acknowledge when
LeJeune refused Sadler’s offer of a full refund the day after
the sale, LeJeune waived his right to demand a refund once
the mobile home was destroyed.

No. 2 - The trial court erred in failing to find there was a valid sale.

No. 3 - The trial court erred in failing to find the risk of loss had
transferred to LeJeune at the time the mobile home was
destroyed.

No. 4 - The trial court erred in failing to find LeJeune’s negligence
in failing to timely move the mobile home to a safe haven
was the legal cause of its destruction.

No. 5 - Finally, the trial court erred in failing to find no sales tax
was owed in connection with the original purchase of the
mobile home by Sadler due to the fact that prior to trial
Sadler had filed the required Act of Immobilization thereby
exempting the mobile home from sales taxes in connection
with Sadler’s original purchase.

Discussion

Three of the defendant’s assignments of error are predicated on the assumption

that the trial court erred in finding that there was no contract. Before turning to those

assignments, we address whether the trial court erred in finding that there was no

contract, which the defendant raises in his second assignment.

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Sales Taxes

Relevant to the determination of whether or not a contract existed is the

defendant’s last assignment of error—that the trial court erred in failing to find that

no sales tax was owed because of a late-filed “Act of Immobilization.” Upon the

filing of an Act of Immobilization, a mobile home ceases to be subject to the taxes

due upon movables and becomes subject to the taxes due on immovable property.

La.R.S. 9:1149.4. After Hurricanes Katrina and Rita, the legislature allowed

retroactive filing of an Act of Immobilization for mobile homes purchased in certain

parishes between September 1, 2005 and December 1, 2006. La.R.S. 9:1149.4(C).

The Act of Immobilization filed in this case reflects that it was filed in the Cameron

Parish records on July 31, 2009.

The defendant argues that the trial court erred in finding that, because the Act

of Immobilization could have been filed at any time, no outstanding taxes were owed

on the mobile home. The defendant argues that, therefore, the taxes were a “non-

issue” in this case. We find the defendant’s argument unpersuasive. At the time of

the sale, the Act of Immobilization had not been filed. Taxes on the sale of a mobile

home are due and owing until the Act of Immobilization is filed. La.R.S.

9:1149.4(B). Thus, at the time of the purported sale, taxes were still owed on the

mobile home. Although the Act of Immobilization could have been filed

retroactively, it was not filed prior to the destruction of the mobile home. In fact, it

was not filed until after the instant suit was filed—almost a year after the destruction

of the mobile home. Further, the responsibility to file the Act of Immobilization fell

to the defendant, not the plaintiffs. See Gibbs Constr. Co., Inc. v. Thomas, 500 So.2d

764 (La.1987) (wherein the supreme court found that a subcontractor could not rely

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on his own failure to deliver a required letter of credit to defeat his obligations under

a contract). Therefore, we find that the trial court did not err in failing to find that no

taxes were owed.

This assignment of error is without merit.

Mutual Error or Mistake

The defendant alleges that the trial court erred in finding that no valid contract

for sale existed.

The requirements for a valid sale are addressed in La.Civ.Code art. 2439,

which states that: “Sale is a contract whereby a person transfers ownership of a thing

to another for a price in money. The thing, the price, and the consent of the parties

are requirements for the perfection of a sale.”

Louisiana Civil Code Article 1948 provides that consent may be vitiated by

error, fraud, or duress. In order to vitiate consent, the error must concern a cause

without which the obligation would not have been incurred and must have been

known or should have been known to the other party. La.Civ.Code art. 1949.

Error may concern a cause when it bears on the nature of the
contract, or the thing that is the contractual object or a substantial
quality of that thing, or the person or the qualities of the other party, or
the law, or any other circumstance that the parties regarded, or should
in good faith have regarded, as a cause of the obligation.

La.Civ.Code art. 1950.

The determination of the existence of a contract is a finding of fact that will not

be disturbed on review unless clearly wrong or manifestly erroneous. Dubois Constr.

Co. v. Moncla Constr. Co., 39,794 (La.App. 2 Cir. 6/29/05), 907 So.2d 855.

Here, the trial court found that “there was mutual error as to the purchase price

which vitiated Mr. LeJeune’s consent to the sale. Thus, there was no valid sale in this

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case.” The defendant argues that the sales tax issue was not substantial enough for

Tri-Lake to rescind the sale when the defendant offered to refund the purchase price,

and thus, could not have been a cause without which the obligation would not have

been incurred.

At trial, LeJeune testified that he agreed to purchase the mobile home for

twenty-five thousand dollars. LeJeune’s testimony reflects that he considered that he

would be able to title the mobile home in Tri-Lake’s name for the agreed upon

purchase price. Additionally, according to LeJeune, an insurance agent, he would not

have been able to obtain insurance on the mobile home until he could title it in Tri-

Lake’s name and would not have been able to obtain flood insurance for an additional

thirty days. He further testified that he was afraid to move the mobile home without

insurance.

LeJeune testified that he could have found the money to pay the taxes, but that

he did not intend to pay any of the defendant’s outstanding taxes because he had not

agreed to pay any extra tax. LeJeune did not know how much the outstanding taxes

would have been, but he was under the impression that, including interest and fees,

they would have totaled in the thousands of dollars.

Sadler testified that he was under the impression that removing the axles and

tongue “immoblized” the home for the purposes of exemption from sales tax. He said

he was unaware that an Act of Immobilization needed to be filed in order to exempt

the mobile home from sales tax. He also testified that he was unaware that he needed

to have the title transferred into Couteau Plateau’s name and that he believed the bill

of sale was sufficient to effect the transfer. Sadler testified that his first conversation

with LeJeune was strictly about the price of the mobile home and that Couteau

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Plateau would accept the risk of loss for Hurricane Gustav. Sadler denied that he

spoke with LeJeune about the title or sales tax issue before he left for vacation.

Rather, LeJeune testified that the first time he spoke to Sadler was about the

outstanding tax issue and that Sadler asked him if he wanted his “money back.”

According to LeJeune, he told Sadler that he wanted to work out the tax issue, but

that he would “think about it” and get back to Sadler. Sadler testified that LeJeune

“refused” his offer of a refund. LeJeune testified that he declined Sadler’s offer

because the mobile home was a “good deal” and he wanted to try and work things

out.

Here, the relevant determination is whether the error with regard to the then-

oustanding taxes was sufficient to constitute an error that vitiated consent. In Levin

v. May, 03-2205 (La.App. 1 Cir. 9/17/04), 887 So.2d 497, the first circuit held that,

in the sale of a business, the failure to remit collected sales taxes could constitute an

error that concerned cause. The first circuit compared the failure to remit collected

sales taxes in that case to the inability to provide merchantable title in the sale of

immovable property. Id.

Similarly, our review of the record, including the above testimony, as well as

the physical evidence and depositions submitted at trial, reveals evidence sufficient

to support the trial court’s conclusion that neither did the parties intend for LeJeune

to be responsible for additional taxes nor would LeJeune have purchased the mobile

home if he knew that he would have to pay the taxes. Thus, the trial court was not

manifestly erroneous in finding that this error vitiated consent and there was not a

valid contract.

This assignment of error is without merit.

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Additional Assignments of Error

The defendant has asserted three additional assignments of error which are all

predicated on the assumption that the trial court erred in finding that no valid contract

existed. Because we have determined that the trial court did not so err, those

assignments of error are pretermitted.

DECREE

For the foregoing reasons, the trial court’s judgment is affirmed. All costs of

this appeal are assessed to the defendant.

AFFIRMED.

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