Catahoula Parish School Board v. Louisiana MacHinery Rentals, LLC

STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT

12-443
CONSOLIDATED WITH
12-444

CATAHOULA PARISH SCHOOL BOARD
CATAHOULA PARISH POLICE JURY

VERSUS

LOUISIANA MACHINERY RENTALS, LLC

CONSOLIDATED WITH

CATAHOULA PARISH SCHOOL BOARD
CATAHOULA PARISH POLICE JURY

VERSUS

LOUISIANA MACHINERY COMPANY, LLC

**********
APPEAL FROM THE
SEVENTH JUDICIAL DISTRICT COURT
PARISH OF CATAHOULA, NOS. 26,291 “A” AND 26,292 “A”
HONORABLE KATHY JOHNSON, DISTRICT JUDGE
**********
JAMES T. GENOVESE
JUDGE

**********

Court composed of John D. Saunders, Elizabeth A. Pickett, and James T.
Genovese, Judges.

REVERSED AND REMANDED.

Jesse R. Adams, III
Kathryn S. Friel
Andre Brian Burvant
Matthew A. Mantle
Jones, Walker, Waechter, Poitevent, Carrère & Denègre, L.L.P.
201 St. Charles Ave., 51st Floor
New Orleans, Louisiana 70170-5100
(504) 582-8000
COUNSEL FOR DEFENDANTS/APPELLANTS:
Louisiana Machinery Rentals, LLC and
Louisiana Machinery Company, LLC

Jack Hendrix McLemore, Jr.
Post Office Box 520
200 Advocate Row, Suite B
Vidalia, Louisiana 71373
(318) 336-9189
COUNSEL FOR PLAINTIFFS/APPELLEES:
Catahoula Parish School Board and
Catahoula Parish Police Jury

Robert R. Rainer
Drew M. Talbot
Rainer, Anding & McLindon
8480 Bluebonnet Blvd., Suite D
Baton Rouge, Louisiana 70810
(225) 766-0200
COUNSEL FOR PLAINTIFFS/APPELLEES:
Catahoula Parish School Board and
Catahoula Parish Police Jury

GENOVESE, Judge.

In these consolidated sales and use tax cases, Defendants, Louisiana

Machinery Rentals, LLC, and Louisiana Machinery Company, LLC (collectively

the Companies), appeal partial summary judgments enforcing the assessment of the

taxing authorities, Plaintiffs, Catahoula Parish School Board and the Catahoula

Parish Police Jury. Plaintiffs have answered the appeals, seeking sanctions against

the Companies for filing frivolous appeals. For the reasons that follow, we reverse

the trial court’s grant of the partial summary judgments; we deny the claims for

damages for frivolous appeals; and, we remand these matters to the trial court for

further proceedings.

FACTS AND PROCEDURAL HISTORY

The Companies, Louisiana’s exclusive Caterpillar franchise dealers, sold,

leased, and repaired Caterpillar equipment and machinery in Catahoula Parish.

The Catahoula Parish School Board and the Catahoula Parish Police Jury

designated the Concordia Parish School Board (the Collector) as their sales and use

tax collector.

The Collector commissioned a private auditing firm to perform an audit of

the Companies which revealed deficiencies for the period December 1, 2000,

through June 30, 2007. The Collector, thereafter, initiated the collection process

on November 24, 2009, by sending each of the Companies a Notice of Intent to

Assess additional taxes, penalties, and interest in accordance with La.R.S.

47:337.48.1 The Companies neither protested the Notice of Intent to Assess, nor

did they request a hearing.

1
Louisiana Revised Statutes 47:337.48 provides as follows:

A. If a taxpayer fails to make and file any return or report required by the
provisions of the local ordinance and this Chapter, the collector shall determine
the tax, penalty, and interest due by estimate or otherwise. Having determined the

The Collector then issued each of the Companies a formal Notice of

Assessment (also referred to as the Original Assessments) on December 24, 2009,

allegedly in accordance with La.R.S. 47:337.51 in effect in 2009 before the 2010

amendment to subsections A and B.2 Upon receipt of the notice, the Companies

amount of tax, penalty, and interest due, the collector shall send by mail a notice
to the taxpayer at the address given in the last report filed by him pursuant to the
provisions of this Chapter, or to any address that may be obtainable from any
private entity which will provide such address free of charge or from any federal,
state, or local government entity, including but not limited to the U.S. Postal
Service or from U.S. Postal Service certified software, setting out his
determination and informing the person of his purpose to assess the amount so
determined against him after fifteen calendar days from the date of the notice.

B. If a return or report made and filed does not correctly compute the
liability of the taxpayer, the collector shall cause an audit, investigation, or
examination, as provided for by R.S. 47:337.35, to be made to determine the tax,
penalty, and interest due. Having determined the amount of tax, penalty, and
interest due, the collector shall send by mail a notice to the taxpayer at the address
given in the last report filed by him pursuant to the provisions of this Chapter, or
to any address that may be obtainable from the U.S. Postal Service or from U.S.
Postal Service certified software, setting out his determination and informing the
person of his purpose to assess the amount so determined against him after thirty
calendar days from the date of the notice.
2
Louisiana Revised Statutes 47:337.51 provided as follows:

A. Having assessed the amount determined to be due, the collector shall
send a notice by certified mail to the taxpayer against whom the assessment is
imposed at the address given in the last report filed by said taxpayer, or to any
address obtainable from any private entity which will provide such address free of
charge or from any federal, state, or local government entity, including but not
limited to the United States Postal Service or from the United States Postal
Service certified software. If no report has been timely filed, the collector shall
send a notice by certified mail to the taxpayer against whom the assessment is
imposed at any address obtainable from any private entity which will provide
such address free of charge or from any federal, state, or local government entity,
including but not limited to the United States Postal Service or from the United
States Postal Service certified software. This notice shall inform the taxpayer of
the assessment and that he has sixty calendar days from the date of the notice to
(a) pay the amount of the assessment; (b) request a hearing with the collector; or
(c) pay under protest in accordance with R.S. 47:337.63.

B. If any dealer shall be aggrieved by any findings or assessment of the
collector, he may, within thirty days of the receipt of notice of the assessment or
finding, file a protest with the collector in writing, signed by himself or his duly
authorized agent, which shall be under oath and shall set forth the reason therefor,
and may request a hearing. Thereafter, the collector shall grant a hearing to said
dealer, if a hearing has been requested, and may make any order confirming,
modifying or vacating any such finding or assessment. The filing of any such
protest shall not abate any penalty for nonpayment, nor shall it stay the right of
the taxing authority to collect the tax in any manner herein provided. Appeals
from the decision of the collector shall be directed to any state, city or federal
court of competent jurisdiction. This Section shall afford a legal remedy and right
2

did not pay the assessment, respond in protest, or request a hearing. Instead, the

Companies provided additional tax records to the auditors that they had previously

withheld.

The Collector reviewed the additional audit documentation and subsequently

affirmed its findings. On February 22, 2010, the Collector reissued a second

formal Notice of Assessment-Extension (sometimes referred to as the First Revised

Assessments) to the Companies in accordance with La.R.S. 47:337.51. The First

Revised Assessments extended additional time to the Companies to raise either

factual or legal objections. They did not do so.

After receiving the First Revised Assessments, the Companies again

submitted additional records to the auditors. After the auditors reviewed this

newly supplied information, the assessments were substantially reduced. The

Collector then issued a third formal Notice of Assessment-Extension (sometimes

referred to as the Second Revised Assessments) to the Companies on April 26,

2010. The Companies did not respond to the Second Revised Assessments.

of action in any state, city or federal court having jurisdiction of the parties and
subject matter for a full and complete adjudication of any and all questions arising
in the enforcement of the local ordinance and this Chapter as to the legality of any
tax accrued or accruing or the method of enforcement thereof.

C. (1) No assessment made by the collector shall be final if it is
determined that the assessment was based on an error of fact or of law. An “error
of fact” for this purpose means facts material to the assessment assumed by the
collector at the time of the assessment to be true but which subsequently are
determined by the collector to be false. “Error of law” for this purpose means that
in making the assessment the collector applied the law contrary to the
construction followed by the collector in making other assessments.

(2) The determination of an error of fact or of law under this Subsection
shall be solely that of the collector, and no action against the collector with
respect to the determination shall be brought in any court, and no court shall have
jurisdiction of any such action, it being the intent of this Subsection only to permit
the collector to correct manifest errors of fact or in the application of the law
made by the collector in making the assessment; however, all reductions of
assessments based on such errors, except estimated assessments made due to the
failure of the taxpayer to file a proper tax return, must be approved and signed by
the collector. Estimated assessments made due to the failure of the taxpayer to
file a proper tax return may be corrected by the acceptance of the proper tax
return and must be approved by the collector or his designee.

3

Consequently, on September 27, 2010, the Collector instituted the present

proceedings by filing a Rule for Payment of Sales Tax against each of the

Companies for payment of taxes, penalties, interest, and attorney fees pursuant to

La.R.S. 47:337.61.3

3
Louisiana Revised Statutes 47:337.61 provides as follows:

In addition to any other procedure provided in this Chapter or elsewhere in
the laws of this state, and for the purpose of facilitating and expediting the
determination and trial of all claims for taxes, penalties, interest, attorney fees, or
other costs and charges arising, there is hereby provided a summary proceeding
for the hearing and determination of all claims by or on behalf of the taxing
authority, or by or on behalf of the collector, for taxes and for the penalties,
interest, attorney fees, costs or other charges due thereon, by preference in all
courts, all as follows:

(1) All such proceedings, whether original or by intervention or third
opposition or otherwise, brought by or on behalf of the taxing authority, or by or
on behalf of the collector, for the determination or collection of any tax, interest,
penalty, attorney fees, costs or other charge claimed to be due shall be summary
and shall always be tried or heard by preference, in all courts, original and
appellate, whether in or out of term time, and either in open court or chambers, at
such time as may be fixed by the court, which shall be not less than two nor more
than ten days after notice to the defendant or opposing party.

(2) All defenses, whether by exception or to the merits, made or intended
to be made to any such claim, must be presented at one time and filed in the court
of original jurisdiction prior to the time fixed for the hearing, and no court shall
consider any defense unless so presented and filed. This provision shall be
construed to deny to any court the right to extend the time for pleading defenses,
and no continuance shall be granted by any court to any defendant except for legal
grounds set forth in the Louisiana Code of Civil Procedure.

(3) That all matters involving any such claim shall be decided within
forty-eight hours after submission, whether in term time or in vacation, and
whether in the court of first instance or in an appellate court, and all judgments
sustaining any such claim shall be rendered and signed the same day, and shall
become final and executory on the fifth calendar day after rendition. No new
trial, rehearing or devolutive appeal shall be allowed. Suspensive appeals may be
granted, but must be perfected within five calendar days from the rendition of the
judgment by giving of bond, with good and solvent security, in a sum double that
of the total amount of the judgment, including costs. Such appeals, whether to a
court of appeal or to the supreme court, shall be made returnable in not more than
fifteen calendar days from the rendition of the judgment.

(4) Whenever the pleadings filed on behalf of the taxing authority, or on
behalf of the collector, shall be accompanied by an affidavit of the collector or of
one of his assistants or representatives or of the counsel or attorney filing the
same, that the facts as alleged are true to the best of the affiant's knowledge or
belief, all of the facts alleged in said pleadings shall be accepted as prima facie
true and as constituting a prima facie case, and the burden of proof to establish
anything to the contrary shall rest wholly on the defendant or opposing party.

4

The Companies responded to these proceedings by filing exceptions,

affirmative defenses, and answers to each Rule for Payment of Sales Tax.

Thereafter, and with leave of court, the Collector filed a Supplemental and

Amending Petition for Rule to Show Cause in Summary Sales and Use Tax

Proceeding in each proceeding. In addition, the Collector filed exceptions of lack

of subject matter jurisdiction and exceptions of preemption in response to the

Companies’ exceptions, affirmative defenses, and answers. The Collector also

filed motions for partial summary judgment. Responding to the supplemental

petitions, the Companies again raised exceptions, affirmative defenses, and filed

answers thereto.

On January 5, 2012, the trial court held a hearing only on the motions for

partial summary judgment. Based upon its determination that the April 26, 2010

Second Revised Assessments were final, the trial court granted partial summary

judgments against each Company in favor of the Collector. The Companies

appealed their respective judgments, and the Collector answered the appeals,

seeking sanctions for frivolous appeals. These matters were consolidated by this

court on appeal.

ASSIGNMENTS OF ERROR

On appeal, the Companies assign four errors by the trial court. They first

assert that the trial court erred in failing to find that the Notice of Assessment-

Extensions did not comply with La.R.S. 47:337.51(A), thereby making said notices

invalid and void. The Companies next assert that the trial court erred in

concluding that the requirements of La.R.S. 47:337.51(A) need not have been

specifically enumerated in these cases since the taxpayers were large companies.

The Companies further assert that the trial court erred in failing to find that the

claims for taxes had prescribed prior to the issuance of the Notice of Assessment-
5

Extensions. Finally, they contend that the trial court erred in granting the motions

for partial summary judgment because the affidavits filed in support thereof were

not based on personal knowledge and that genuine issues of material fact as to the

amount of taxes owed by the Companies remain in dispute.

LAW AND DISCUSSION

STANDARD OF REVIEW

Our Louisiana Supreme Court has instructed us on the standard
of review relative to a motion for summary judgment as follows:

A motion for summary judgment is a procedural
device used when there is no genuine issue of material
fact for all or part of the relief prayed for by a litigant.
Duncan v. U.S.A.A. Ins. Co., [06-363 (La. 11/29/06)],
950 So.2d 544, [see La.Code Civ.P.] art. 966. A
summary judgment is reviewed on appeal de novo, with
the appellate court using the same criteria that govern the
trial court’s determination of whether summary judgment
is appropriate; i.e. whether there is any genuine issue of
material fact, and whether the movant is entitled to
judgment as a matter of law. Wright v. Louisiana Power
& Light, [06-1181 (La. 3/9/07)], 951 So.2d 1058[ ]; King
v. Parish National Bank, [04-337 (La. 10/19/04)], 885
So.2d 540, 545; Jones v. Estate of Santiago, [03-1424
(La. 4/14/04)], 870 So.2d 1002[.]

Samaha v. Rau, 07-1726, pp. 3-4 (La. 2/26/08), 977 So.2d 880,
882-83 (footnote omitted).

Jagneaux v. Frohn, 11-461, p. 2 (La.App. 3 Cir. 10/5/11), 74 So.3d 309, 310.

ASSIGNMENTS OF ERROR NUMBERS ONE & TWO

Louisiana Revised Statutes 47:337.5 Notice

In these combined assignments of error, the Companies essentially allege

that the trial court erred in finding that the Collector’s notices (in globo) failed to

comply with La.R.S. 47:337.51(A) and were, therefore, invalid and void. The

notice in question is as follows:

NOTICE: As provided in LA R. S. 47:337.51B, if you wish to protest, you have thirty (30) days
from the date hereof to file with this office a written protest, signed by you or your duly
authorized agent, which shall be under oath, fully disclosing the reasons therefor, and request a
hearing.

6

If you do not timely file a written protest and request a hearing, you have sixty (60) calendar days
from the date hereof to:

1) Pay the amount set forth herein above,
2) Pay the total amount set forth herein above under protest as provided in LA R.S.
47:337.63 and file suit for recovery within thirty (30) days of payment, or

3) Within thirty (30) days of receipt of this Notice of Assessment, file suit in any state
court of competent jurisdiction contesting the final assessment, and in connection
therewith, post a commercial bond or other security as provided in LA R.S.
47:337.64 in accordance with the procedures set forth therein.

Do not disregard this notice, failure to act within the time or manner provided will result in
the assessment becoming final and enforceable by warrant for distraint. Additional
penalties, interest and collection fees may be assessed at that time.

Any questions concerning this notice may be directed to the undersigned representative.

Respectfully,

Department of Revenue & Taxation
Sales and Use Tax Division
Parishes of Concordia, Catahoula, Caldwell,
East Carroll, LaSalle and Tensas

BY: _____[Original Signed]_________
Thomas H. O’Neal

IMPORTANT: The collector may, in his discretion, proceed to enforce the collection of any taxes due by means of any of
the following remedies or procedures: (1) Assessment and distraint, as provided by R.S. 47:337.48 through 337.60, (2)
Summary court proceeding, as provided in R.S. 47:337.61, (3) Ordinary suit under provisions of the general laws regulating
actions for the enforcement of obligations, (4) Rule to cease business as provided in R.S. 47:337.33. The Collector by
issuing this Notice does not waive the right to assert such other remedies.

Our brethren in the second circuit squarely addressed the issue of the

validity of the same Notice and Assessment(s) pursuant to La.R.S. 47:337.51 in the

case of Caldwell Parish School Board v. Louisiana Machinery Co., LLC, 47,349,

47,350 (La.App. 2 Cir. 5/16/12), 94 So.3d 144.4 In Caldwell, the second circuit

found the same notices to be statutorily and substantially deficient in that they did

not specifically give notice to the taxpayers that they had sixty days from the date

of the notices to request a hearing on the matter. We agree.

We are, however, mindful of the fact that there are a number of other tax

cases involving Louisiana Machinery Rentals, LLC and/or Louisiana Machinery

Company, LLC in a number of parishes and judicial districts concerning La.R.S.

47:337.51 (Sec. 51) and La.R.S. 47:337.61 (Sec. 61). Some of these cases have
4
We note that the supreme court, in docket number 12-1383, granted writs on September 28,
2012.
7

been decided in favor of the tax collector; some have been decided in favor of the

taxpayer; and, several are presently before our supreme court on supervisory writs.

Of particular interest, we note this court’s recent decision in Jefferson Davis

Parish School Board, ex rel. Sales/Use Tax Dep’t v. Louisiana Machinery Rentals,

LLC, 11-510, 11-512 (La.App. 3 Cir. 10/5/11), 74 So.3d 1272, writ denied,

11-2437 (La. 1/13/12), 77 So.3d 972, wherein we held that the Jefferson Davis

Parish School Board properly followed the procedure outlined in Sec. 51; however,

the issue of proper notice was neither argued nor assigned as error in the Jefferson

Davis case. Therefore, that case is readily distinguishable and neither persuasive

nor controlling.

We are also cognizant of this court’s recent decisions in LaSalle Parish

School Board v. Louisiana Machinery Rentals, LLC, 12-259 (La.App. 3 Cir.

6/6/12), 92 So.3d 1232, and LaSalle Parish School Board v. Louisiana Machinery

Co., LLC, 12-276 (La.App. 3 Cir. 6/6/12), 92 So.3d 1238 (collectively referred to

herein as LaSalle). We likewise distinguish LaSalle as it relied on Normand v.

Randazzo, 11-308 (La.App. 5 Cir. 12/28/11), 85 So.3d 707, writ denied, 12-285

(La. 4/9/12), 85 So.3d 697. LaSalle differs from Normand. In Normand, the

summary proceeding was brought as an alternative to the assessment procedure. In

the instant case and in LaSalle, the summary proceedings were entirely premised

and dependent upon the alleged finality of the assessments. Additionally, in

Normand, contrary to LaSalle, there was a hearing in the summary proceeding

wherein testimony was presented and documentary evidence was introduced on the

merits of the tax collector’s claims. In LaSalle, the taxpayers were precluded from

presenting any evidence on the assessment or raising any defenses. Due to the

significant inconsistency and distinguishing factors in LaSalle and Normand, we

8

elect to follow Normand as the more accurate statement of the law relative to the

requirements of Sections 51 and 61.

Louisiana Revised Statutes 47:337.51(A)(prior to January 1, 2011)(emphasis

added) specifically states that, “This notice shall inform the taxpayer of the

assessment and that he has sixty calendar days from the date of the notice to (a)

pay the amount of the assessment; (b) request a hearing with the collector; or (c)

pay under protest. . . .” The statute reads “shall[,]” and it requires that the notice

inform the taxpayer that he has sixty days to request a hearing.

The notice in the instant case does not state that the taxpayer has sixty days

to request a hearing. The notice states that the taxpayer has sixty days to pay the

amount set forth therein, pay the amount therein under protest, or file suit within

thirty days of receipt of the notice. It does not state anywhere in the notice, as

mandated by the statute, that the taxpayer has sixty days to request a hearing.

After thoroughly reviewing the facts in the instant case, and considering the

jurisprudence pertaining to the notice requirements of La.R.S. 47:337.51(A) prior

to January 1, 2011, we find the notice in the instant case to be deficient and the

assessment invalid due to its failure to state that the taxpayer has sixty days from

the date of the notice to request a hearing as mandated by the statute. As such, the

written notice given in the instant case does not comply with La.R.S. 47:337.51(A)

and does not have the preclusive and legal effect of denying the Companies the

right to present their defenses in response to the Collector’s claims, even in a

summary proceeding.

Louisiana Revised Statutes 47:337.61

The fact that we find the notice deficient and the assessment invalid under

Sec. 51 does not conclude this matter. The Collector still has the option to proceed

with summary proceedings in accordance with Sec. 61, which it did.
9

The Uniform Local Sales Tax Code (ULSTC), La.R.S. 47:337.1, et seq., is

the law which governs the local collection and enforcement of sales and use taxes.

Louisiana Revised Statutes 47:337.455 allows the Collector three options “to

enforce the collection of any taxes due under the local ordinance”: assessment and

distraint (Sec. 51); summary court proceedings (Sec. 61); or ordinary suit for the

enforcement of obligations. There is also an alternative procedure under La.R.S.

47:337.33 which allows the Collector to pursue an injunction. Because the

Collector did not seek an injunction and did not file an ordinary suit for

enforcement of the obligation, these remedies are not at issue and need not be

addressed.

In the instant case, the Collector began its sales and use tax collection

proceedings by assessment and distraint in accordance with Sec. 51, which requires

a valid notice as previously discussed. Later on in the proceedings, the Collector

filed supplemental and amending pleadings in order to pursue its claims in a

5
Louisiana Revised Statutes 47:337.45 (prior to January 1, 2011) provided as follows:

A. In addition to following any of the special remedies provided in this
Chapter, the collector may, in his discretion, proceed to enforce the collection of
any taxes due under the local ordinance by means of any of the following
alternative remedies or procedures:

(1) Assessment and distraint, as provided in R.S. 47:337.48 through
337.60.

(2) Summary court proceeding, as provided in R.S. 47:337.61.

(3) Ordinary suit under the provisions of the general laws regulating
actions for the enforcement of obligations.

B. The collector may choose which of these procedures he will pursue in
each case, and the counter-remedies and delays to which the taxpayer will be
entitled will be only those which are not inconsistent with the proceeding initiated
by the collector, provided that in every case the taxpayer shall be entitled to
proceed under R.S. 47:337.63 except (a) when an assessment for the tax in
question has become final or (b) when a suit involving the same tax obligation is
pending against him; and provided further, that the fact that the collector has
initiated proceedings under the assessment and distraint procedure will not
preclude him from thereafter proceeding by summary or ordinary court
proceedings for the enforcement of the same tax obligation.

10

summary proceeding in accordance with Sec. 61, which it was legally entitled to

do. Thereafter, the Collector filed motions for partial summary judgment within

the summary proceedings and attached its supporting documentation and affidavits

in accordance with the provisions of Sec. 61.

Louisiana Revised Statutes 47:331.61(2) specifically allows for defenses to

be presented in the summary proceedings. It is undisputed that the Companies

presented defenses, including its exception of prescription, which were disallowed

by the trial court. In fact, the trial court specifically stated in its ruling “that each

of these assessments are final and that the defendant’s [sic] [are] precluded from

attacking them.” The trial court erred in ruling that the Companies could not attack

the assessments and present defenses, which is contrary to the provisions of Sec.

61(2). In Tensas Parish School Board v. Louisiana Machinery Co., LLC, 47,516,

47,517 (La.App. 2 Cir. 6/29/12), 94 So.3d 1039,6 on this same issue and set of

facts, the second circuit reversed the trial court’s grant of partial summary

judgments, finding that the taxpayers are allowed to present defenses under Sec.

61. We agree.

In summary, Sec. 51 and Sec. 61 are two separate and distinct remedies

available to the Collector in pursuit of its collection of sales and use taxes under

La.R.S. 47:337.1, et seq. Either may be implemented.

In the instant case, the Collector began in Sec. 51 and ended in Sec. 61. Had

this court not held the Collector’s Sec. 51 Notice of Assessment to have been

defective in its failure to apprise the Companies of their right to request a hearing

within sixty days of the notice, the assessment would have been valid and final

after that sixty day period, since no action was taken during that time period, and

6
We note that the supreme court, in docket number 12-1762, granted writs on September 28,
2012.

11

the Companies would have been precluded from raising any defenses. However,

such was not the case. The Collector’s Notice of Assessment was statutorily

deficient and defective; therefore, the Collector’s claim that the assessment was

final and definitive and that the Companies were precluded from challenging same

by prescription or otherwise is erroneous and without merit.

The Collector’s alternative attempt to proceed with summary proceedings

under Sec. 61, though legally permissible, is tainted and thwarted by the trial

court’s refusal to allow the Companies to present its defenses to the Collector’s

claims, which the statute specifically permits. Consequently, the trial court’s grant

of the Collector’s motions for partial summary judgment must be reversed and the

matter remanded for further proceedings consistent herewith.

ASSIGNMENT OF ERROR NUMBER THREE

Prescription

In this assignment of error, the Companies allege that the trial court erred in

not finding the Collector’s claim for taxes to have been prescribed. Whether the

Collector’s claim for taxes had prescribed was neither addressed nor ruled upon by

the trial court. The trial court did not consider this issue since it disallowed any

and all defenses, including the exception of prescription, presented by the

Companies. Having reversed the trial court’s ruling that the Collector’s Notice of

Assessment under Sec. 51 was valid and having found that the Companies are

legally permitted under Sec. 61 to assert defenses to the Collector’s claims, we

remand this matter to the trial court for consideration and ruling upon the defenses,

including the exception of prescription, asserted by the Companies.

ASSIGNMENT OF ERROR NUMBER FOUR

The Companies allege that the trial court erred in granting the Collector’s

motions for partial summary judgment in that the supporting affidavits were not

12

based on personal knowledge and that genuine issues of material fact existed as to

the amount of tax owed by them. We agree.

In order to respond to this assignment of error, we must first differentiate

between a summary judgment proceeding and summary proceedings. They are not

one and the same.

In the instant case, the Collector filed motions for partial summary judgment

within the summary proceedings provided for in Sec. 61. However, the rules for

summary judgment are different from the rules set forth in the summary

proceedings allowed in Sec. 61. Specifically, the evidentiary rules in a summary

judgment proceeding are strict and definitive. Only certain evidentiary matters

may be considered in a summary judgment proceeding, e.g., pleadings,

depositions, answers to interrogatories, admissions, and affidavits. La.Code Civ.P.

art. 966(B). No testimony is allowed. Additionally, in a summary judgment

proceeding, “[s]upporting and opposing affidavits shall be made on personal

knowledge, shall set forth such facts as would be admissible in evidence, and shall

show affirmatively that the affiant is competent to testify to the matters stated

therein.” La.Code Civ.P. art. 967(A).

This is contrary to the admissibility of affidavits permissible in summary

proceedings allowed under Sec. 61. An affidavit in accordance with Sec. 61(4)

only requires “that the facts as alleged are true to the best of the affiant’s

knowledge or belief,” not that the affiant must have personal knowledge of the

matters stated therein as required in summary judgment affidavits. This nuance

creates a conflict between the requirements of admissible affidavits when a motion

for summary judgment is filed within summary proceedings allowed under Sec. 61,

as is the case herein.

13

Furthermore, a summary judgment proceeding is only a type of summary

proceedings. Summary proceedings are defined as “those which are conducted

with rapidity, within the delays allowed by the court, and without citation and the

observance of all the formalities required in ordinary proceedings.” La.Code

Civ.P. art. 2592. Summary proceedings may be used for trial or disposition of

those matters specifically set forth in La.Code Civ.P. art. 2592. Louisiana Code of

Civil Procedure Article 2592(12) states that summary proceedings are allowed in

“[a]ll other matters in which the law permits summary proceedings to be used.”

Sec. 61 provides for the use of summary proceedings for the hearing and

determination of all claims by or on behalf of the taxing authority or tax collector

by preference in all courts. The summary proceedings in Sec. 61 allow for

defenses to be presented and testimony to be had. This is contrary to a summary

judgment proceeding which has strict evidentiary requirements and does not permit

testimony.

Considering this disparity, a motion for summary judgment is problematic

and inappropriate in Sec. 61 summary proceedings unless the legal requirements

for all pertinent statutes are met. The affidavits by Mr. Thomas H. O’Neal, the

Sales Tax Director for the Concordia Parish School Board, in the Sec. 61

proceedings, were valid, but those same affidavits are invalid in a summary

judgment proceeding because they were not based on requisite personal

knowledge. The matter comes before us in a summary judgment proceeding;

therefore, the affidavits, which were not based on personal knowledge, were

inadmissible, and the grant of the partial summary judgments improvident. This in

no way precludes the use of Sec. 61 affidavits in summary proceedings in Sec. 61

hearings; however, should a summary judgment proceeding be implemented in

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summary proceedings under Sec. 61, the strict evidentiary requirements of a

summary judgment proceeding must be followed.

Even assuming, arguendo, that the notice herein is determined to be

satisfactory, the grant of summary judgment must be and is reversed, as it was

based on legally deficient affidavits and incompetent evidence.

ANSWER TO APPEAL

Finally, we must consider the Collector’s request for sanctions against the

Companies for frivolous appeals. When considering allegations of a frivolous

appeal, this court has stated:

The Louisiana Supreme Court has instructed
appellate courts to award damages for frivolous appeal
only when an appeal is taken for purposes of delay or
when appellate counsel is not sincere in the belief of the
view he or she advances on appeal. Middleton v. City of
Natchitoches, 06-1531 (La.App. 3 Cir. 4/4/07), 954 So.2d
356. Damages will not be awarded where the slightest
justification is found for taking the appeal and even
where the appellant does not prevail. Id.

Roy v. Alexandria Civil Serv. Comm’n, 07-1458, p. 6 (La.App. 3 Cir.
4/2/08), 980 So.2d 225, 229.

Succession of Brown, 10-1394, p. 10 (La.App. 3 Cir. 6/29/11), 69 So.3d 1211,

1217.

In the instant matter, we have found the Companies’ appeals to be

meritorious; therefore, the appeals are not frivolous. Thus, we deny the Collector’s

request for sanctions for frivolous appeal.

DECREE

For the reasons expressed herein, the trial court’s grant of the partial

summary judgments in favor of the Catahoula Parish School Board and Catahoula

Parish Police Jury, and against Louisiana Machinery Rentals, LLC, and Louisiana

Machinery Company, LLC, are reversed. Additionally, this matter is remanded to

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the trial court for further proceedings consistent herewith. Costs of this appeal are

assessed to the Catahoula Parish School Board and Catahoula Parish Police Jury in

the amount of $4,362.45 pursuant to La.R.S. 13:5112.

REVERSED AND REMANDED.

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