Byron P. Guillory, Et Ux. v. Pelican Real Estate, Inc.

STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT

14-58

BYRON P. GUILLORY, ET UX.

VERSUS

PELICAN REAL ESTATE, INC., ET AL.

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APPEAL FROM THE
TWENTY-SEVENTH JUDICIAL DISTRICT COURT
PARISH OF ST. LANDRY, NO. 08-C-3477-C
HONORABLE ALONZO HARRIS, DISTRICT JUDGE

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ELIZABETH A. PICKETT
JUDGE

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Court composed of Sylvia R. Cooks, John D. Saunders, Elizabeth A. Pickett,
Shannon J. Gremillion, and Phyllis M. Keaty, Judges.

Gremillion, J., dissents and assigns reasons.

REVERSED AND REMANDED FOR FURTHER PROCEEDINGS.

Melvin A. Eiden
Rabalais & Hebert
701 Robley Drive, #210
Lafayette, LA 70503
(337) 981-0309
COUNSEL FOR PLAINTIFFS/APPELLANTS:
Byron P. Guillory
Margo L. Guillory

Randall L. Guidry
Attorney at Law
503 W. University Avenue
Lafayette, LA 70506-3651
(337) 233-8800
COUNSEL FOR PLAINTIFFS/APPELLANTS:
Byron P. Guillory
Margo L. Guillory

Timothy W. Basden
Breaud & Meyers
P.O. Drawer 3448
Lafayette, LA 70502
(337) 266-2200
COUNSEL FOR DEFENDANTS/APPELLEES:
Pelican Real Estate, Inc.
Marla Smith Landry
Brandi Hebert McKnight
Linda Krupke

Thomas J. Eppling
Staines & Eppling
3500 N. Causeway, Suite 820
Metairie, LA 70002
(504) 838-0019
COUNSEL FOR THIRD PARTY/APPELLEE:
St. Paul Fire & Marine Insurance Company

James L. Brazee, Jr.
Brazee Law Firm
2901 Johnston St., #206
Lafayette, LA 70503
(337) 237-0492
COUNSEL FOR DEFENDANT/APPELLEE:
Dr. Johnny Wayne Jones

2

PICKETT, Judge.

Byron and Margo Guillory appeal the trial court‟s denial of their Motion to

Vacate Ex Parte Order of Abandonment. For the following reasons, we reverse the

judgment of the trial court and remand for further proceedings.

FACTS

In June 2008, Byron and Margo Guillory filed suit, alleging that the home

they purchased from Johnny Jones in Sunset contained a redhibitory defect because

the home and property on which it is situated are prone to flooding. They sued:

(1) Mr. Jones; (2) Marla Landry, Mr. Jones‟s real estate agent; (3) Brandi

McKnight, their real estate agent; (4) Pelican Real Estate, Inc., the entity that

brokered the sale; (5) Linda Krupke, another real estate agent; and (6) ABC

Insurance Company. All of the real estate agents were employed by Pelican. In

their petition, the Guillorys alleged that Mr. Jones and the real estate agents knew

the property had previously flooded and that they made, or caused to be made,

negligent or fraudulent misrepresentations regarding the propensity of the property

to flood that affected their decision to purchase the property.

Mr. Jones answered the suit and filed third party demands against Pelican,

Landry, McKnight, Krupke, and St. Paul Fire and Marine Insurance Company,

Pelican‟s professional liability insurer. St. Paul filed an answer to Mr. Jones‟ third

party demand. St. Paul hired separate counsel to represent Pelican, Landry,

McKnight, and Krupke and to represent Mr. Jones.

On June 20, 2013, St. Paul filed an Ex Parte Motion to Dismiss on the

ground that the Guillorys‟ lawsuit was abandoned because no steps had been taken

in the prosecution or defense of the matter since March 4, 2010, more than three

years before the filing of the motion. The trial court signed the order St. Paul

submitted with its motion the following day, dismissing “the above captioned

matter, including any and all Third Party Demands made therein” with prejudice.

On July 30, 2013, the Guillorys filed a Motion to Vacate the Ex Parte Order of

Dismissal. After a hearing, the trial court granted the Guillorys‟ motion only to the

extent that it requested the dismissal be without prejudice. The Guillorys appealed

the trial court‟s dismissal of their case.

In defense of the Motion to Abandon, and on appeal, the Guillorys assert

that the parties engaged in extensive discovery with the last deposition being taken

on March 4, 2010, and that they propounded interrogatories and requests for

production of documents upon Pelican on December 17, 2012. They further

asserted that Pelican did not respond to the discovery, and that on January 21,

2013, their counsel sent notice scheduling a Rule 10.1 discovery conference upon

Pelican for 2:00 p.m. January 28, 2013. Counsel for Pelican, Landry, McKnight,

and Krupke responded by email on January 24, 2013, asking for terms of a

possible settlement. Counsel for the Guillorys conducted the Rule 10.1 discovery

conference as scheduled to discuss the outstanding discovery. During the

conference, counsel for Pelican, Landry, McKnight, and Krupke asked the

Guillorys to submit a written settlement proposal to his clients and that he be

allowed to respond to the proposal before responding to the discovery.

The Guillorys provided a written settlement offer to Pelican, Landry,

McKnight, and Krupke. Pelican, Landry, McKnight, and Krupke did not respond

to the discovery, and their counsel informed counsel for the Guillorys that he

considered the case abandoned. Thereafter, St. Paul moved to have the case

abandoned; Pelican, Landry, McKnight, Krupke, and Mr. Jones joined in the

motion.

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ASSIGMENTS OF ERROR

The Guillorys assign three errors with the trial court‟s judgment:

1. The trial court erred when it held that the actual participation in
a Rule 10.1 discovery conference by the attorney for Pelican,
Landry, McKnight, and Krupke was not an action taken by
defendants during the abandonment period sufficient to
preclude a finding of abandonment.

2. The trial court erred when it held that the Guillorys‟ action was
abandoned as to all parties.

3. The trial court erred when it did not find that the totality of the
circumstances precluded a finding of abandonment of the
Guillorys‟ claims.

DISCUSSION

Louisiana Code of Civil Procedure Article 561(A)(1) provides, in pertinent

part: “An action . . . is abandoned when the parties fail to take any step in its

prosecution or defense in the trial court for a period of three years.” Subsection

(B) of Article 561 provides: “Any formal discovery as authorized by this Code

and served on all parties whether or not filed of record, including the taking of a

deposition with or without formal notice, shall be deemed to be a step in the

prosecution or defense of an action.”

In Louisiana Department of Transportation & Development v. Oilfield

Heavy Haulers, L.L.C., 11-912, pp. 5-6 (La. 12/6/11), 79 So.3d 978, 981-82, the

supreme court discussed the purpose and history of abandonment, explaining:

The purpose of Article 561 is the prevention of protracted
litigation filed for purposes of harassment or without a serious intent
to hasten the claim to judgment. See Chevron Oil Co. v. Traigle, 436
So.2d 530, 532 (La.1983). Abandonment is not a punitive concept;
rather, it balances two competing policy considerations: (1) the desire
to see every litigant have his day in court and not to lose same by
some technical carelessness or unavoidable delay, and (2) the
legislative purpose that suits, once filed, should not indefinitely linger,
preserving stale claims from the normal extinguishing operation of
prescription. Clark, 00-3010, p. 10-11; 785 So.2d at 787.

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Our jurisprudence has uniformly held Article 561 is to be
liberally construed in favor of maintaining a plaintiff‟s suit. Id., p. 8;
785 So.2d at 785. Because dismissal is the harshest of remedies, any
reasonable doubt about abandonment should be resolved in favor of
allowing the prosecution of the claim and against dismissal for
abandonment. Id., p. 10; 785 So.2d at 787. The intention of Article
561 is not to dismiss suits as abandoned based on technicalities, but
only those cases where plaintiff‟s inaction during the three-year
period has “„clearly demonstrated his abandonment of the case.‟” Id.,
p. 8-9; 785 So.2d at 785-86 (quoting Kanuk v. Pohlmann, 338 So.2d
757, 758 (La.App. 4 Cir. 1976), writ denied, 341 So.2d 420
(La.1977)). For the purpose of determining abandonment, “the intent
and substance of a party‟s actions matter far more than technical
compliance.” Thibaut Oil Co., Inc. v. Holly, 06-0313, p. 5 (La.App. 1
Cir. 2/14/07); 961 So.2d 1170, 1172-73.

The Guillorys first urge that the trial court erred in finding their claims

against Pelican, Landry, McKnight, and Krupke were abandoned because within

three years of the last action taken in this case, they propounded interrogatories and

requests for production on Pelican in December 2012 and conducted a Rule 10.1

discovery conference with counsel for Pelican on January 29, 2013. We agree.

The supreme court has construed Article 561 as imposing three

requirements: (1) a party must take some “step” in the prosecution or defense of

the litigation; (2) the step must be taken in the litigation and must appear in the

record, unless it is formal discovery; and (3) that step must have been taken within

three years of the last step taken by either the plaintiff or defendant. Oilfield

Heavy Haulers, 79 So.3d 978.

In Oilfield Heavy Haulers, the plaintiffs scheduled a Rule 10.1 discovery

conference with one defendant within three years of the last “step” in the

prosecution or defense of the case. All parties in the litigation were copied with

the correspondence scheduling the conference. This court held that because the

correspondence scheduling a Rule 10.1 discovery conference was informal

4

correspondence between the parties, not the formal discovery required by Article

561, it was “tantamount to the employment of „extrajudicial efforts‟ at resolving

outstanding discovery issues” and, therefore, was not a step in the prosecution of

the action. Oilfield Heavy Haulers, 10-1392, p. 6 (La.App. 3 Cir. 4/6/11), 62 So.3d

308, 312. The supreme court reversed, explaining:

[S]ending a letter to all parties scheduling a discovery conference
under Louisiana District Court Rule 10.1 constitutes a step in the
prosecution or defense of the action. Rule 10.1 requires a discovery
conference prior to filing any discovery motion, and discovery
motions have the effect of hastening the matter toward judgment.
Thus, scheduling a Rule 10.1 conference is a necessary part of the
discovery motion process, and a necessary step to hasten a matter
toward judgment when a party has failed to comply with discovery
requests.

Oilfield Heavy Haulers, 79 So.3d at 986.

Mr. Jones and St. Paul assert that because they were not copied with the

discovery, the discovery did not interrupt the abandonment period. Pelican,

Landry, McKnight, and Krupke argue that their notice and receipt of the Guillorys‟

December 2012 discovery requests did not interrupt the accrual of abandonment as

to them because not all parties were served with the discovery requests or the

notice of the Rule 10.1 discovery conference. They contend Article 561 requires

that service of formal discovery be made on all parties in the litigation for the

discovery to constitute a step in the prosecution of the case for purposes of

abandonment. They argue that the supreme court‟s holding in Oilfield Heavy

Haulers stands for this proposition and that the first circuit‟s decision in Louisiana

Department of Transportation & Development v. Bayou Fleet, Inc., 09-1569

(La.App. 1 Cir. 4/28/10), 37 So.3d 1066, writ granted, 10-1215, (La. 7,2,10), 39

So.3d 585, is on point with the facts herein.

5

In Bayou Fleet, DOTD filed suit against the owner of a motor vessel and the

vessel‟s captain for damage caused when the vessel collided with a bridge. At the

request of the vessel owner, DOTD initially withheld service while the two parties

attempted to resolve the claim. Time passed without the claim being resolved and

DOTD served the owner; thereafter, the two parties continued trying to resolve the

claim. More than three years after the last pleading, DOTD moved for a

preliminary default which was granted. 1 The owner, who had not previously been

represented by counsel, hired counsel at that time. The newly-hired counsel had

the suit dismissed on the basis of abandonment.

In seeking to have the dismissal vacated, DOTD asserted three reasons why

the case was not abandoned. First, it argued that an agreement between the parties

that DOTD would not take any action against the owner without giving a thirty-day

written notice interrupted the abandonment period. Next, it argued that the owner

waived its right to plead abandonment because it acknowledged owing a debt to

DOTD. Lastly, DOTD argued that correspondence between it and the owner

before the owner was represented by counsel constituted discovery that satisfied

the formal discovery requirement of Article 561. The trial court found no merit in

DOTD‟s arguments and denied its motion to vacate the dismissal of its case. The

first circuit affirmed.

Pertinent to this case, the first circuit determined that the owner‟s

correspondence requesting documentation supporting the amounts DOTD sought

1
DOTD had filed a motion to substitute counsel during that time; however, it did not
dispute that the filing of the motion to substitute counsel and attendant order did not interrupt the
accrual of time for purposes of abandonment. See Chevron Oil Co. v. Traigle, 436 So.2d 530
(La.1983).

6

to recover did not interrupt the abandonment period because none of the

correspondence was served on the boat captain. The first circuit reasoned:

Pursuant to La. C.C.P. art. 1474, the mailing of discovery
pleadings to adverse parties, in accordance with La. C.C.P. art. 1313,
satisfies the service requirement of La. C.C.P. art. 561. However, in
order to satisfy La. C.C.P. art. 561, it is necessary that any discovery
be mailed to all the parties to the action. In the present case, Bayou
Fleet does not dispute receiving any of DOTD‟s letters by mail, but
the record does not establish that any of the letters sent by these two
parties were also served on Mr. Elsik, the other defendant in the suit.
Thus, the letters were not “served on all parties” as required by La.
C.C.P. art. 561. Because DOTD did not establish service of “formal
discovery” on “all parties,” it did not establish a “step” in the
prosecution of the action. See Stillman [v. Bd. of Supervisors of S.
Univ. & Agric. & Mech. Coll., 07-2107, p. 4 (La.App. 1 Cir. 6/6/08),
992 So.2d 523,] 526.

Bayou Fleet, 37 So.3d at 1075-76 (all but last citation omitted) (footnote omitted).

The supreme court granted DOTD‟s writ of certiorari and reversed the first

circuit‟s conclusion, stating: “Given the unique facts and circumstances of this

case, we find defendant‟s correspondence was tantamount to formal discovery.”

DOTD v. Bayou Fleet, Inc., 10-1215 (La. 7/2/10), 39 So.3d 585, 586. The court

continued: “The serving of any discovery materials shall be considered a step in

the prosecution or defense of an action for purposes of La.Code Civ. Proc. Art.

561, notwithstanding such discovery materials are not filed in the record of the

proceedings. La.Civ.Code Proc. Art. 1474(C)(4).” Id.

As the first circuit noted in Bayou Fleet, La.Code Civ.P. art. 1474, in

conjunction with La.Code Civ.P. art. 1313, provides for the service of discovery by

mail. The first circuit interpreted Article 561 as requiring service of discovery on

all defendants to constitute a step in the prosecution or defense of the action. The

supreme court determined, however, that as long as service of discovery satisfies

the requirements of Article 1474, it satisfies the requirements of Article 561.

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Accordingly, the Guillorys‟ service of discovery on Pelican constituted a step in

the prosecution of their actions against all the defendants for purposes of Article

561.

This result is especially applicable here where the facts alleged by the

plaintiffs show that all the defendants are likely solidarily liable. In Clark v. State

Farm Mutual Automobile Insurance Co., 00-3010, p. 11 (La. 5/15/01), 785 So.2d

779, 787, abandonment was recognized as a form of liberative prescription and,

therefore, “subject to prescription-based exceptions.” The Civil Code provides in

Article 1799, “The interruption of prescription against one solidary obligor is

effective against all solidary obligors,” and in Article 3503, “When prescription is

interrupted against a solidary obligor, the interruption is effective against all

solidary obligors.” Treating abandonment as a species of prescription and

applying the Civil Code concept of interruption of prescription applicable to

solidary obligors, we conclude that interruption of the three-year abandonment

period as to one defendant who is solidarily liable with the other defendants

interrupts the accrual of abandonment as to all the defendants with whom that

defendant is solidarily liable. Therefore, even if the Guillorys‟ service of

discovery on Pelican, Landry, McKnight, and Krupke was not sufficient to

constitute a step in the prosecution of their claims under Article 561, application of

this prescription-based exception yields the same result. For these reasons, the

judgment of the trial court is reversed, and the matter is remanded for further

proceedings.

DISPOSITION

The judgment dismissing the claims of Byron and Margo Guillory is

reversed, and the matter is remanded to the trial court for further proceedings. All

8

costs are assessed to the defendants, Johnny Jones, Marla Landry, Brandi

McKnight, Pelican Real Estate, Inc., Linda Krupke, and St. Paul Fire and Marine

Insurance Company.

REVERSED AND REMANDED FOR FURTHER PROCEEDINGS.

9

STATE OF LOUISIANA

COURT OF APPEAL, THIRD CIRCUIT

DOCKET # 14-58

BYRON P. GUILLORY, ET UX.

VERSUS

PELICAN REAL ESTATE, INC., ET AL.

GREMILLION, Judge, dissents.

I respectfully dissent from the majority’s decision. Louisiana Code of Civil

Procedure Article 561(B) reads (emphasis added): “Any formal discovery as

authorized by this Code and served on all parties whether or not filed of record,

including the taking of a deposition with or without formal notice, shall be deemed

to be a step in the prosecution or defense of an action.”

The majority is correct that Louisiana Dep’t of Transp. & Dev. v. Oilfield

Heavy Haulers, L.L.C., 11-912, (La. 12/6/11), 79 So.3d 978, held that a conference

held pursuant to Rule 10.1 represented a step in the prosecution sufficient to halt

the accrual of abandonment. However, that case involved the noticing of all

parties of the conference. The majority acknowledges this holding but explains it

away on the basis of first circuit jurisprudence.

“The sources of law are legislation and custom.” La.Civ.Code art. 1. This

article states the most fundamental principle in Louisiana judicial interpretation.

Jurisprudence—especially a single case—does not constitute law; rather, the

expression of the legislature does. The legislature spoke when it enacted Code of

Civil Procedure article 561(B). Had the legislature intended to allow partial notice

or notice to a single party in multi-party litigation, the legislature could have

omitted the phrase “and served on all parties.” But it did not omit those words, and

their inclusion is presumed to carry intent. ABL Mgmt., Inc. v. Bd. of Sup’rs of

Southern Univ., 00-798 (La. 11/28/00), 773 So.2d 131. “When a law is clear and

unambiguous and its application does not lead to absurd consequences, the law

shall be applied as written and no further interpretation may be made in search of

the intent of the legislature.” La.Civ.Code art. 9.

The phrase “and served on all parties” must be given effect. It cannot be

ignored. And in this case, the notice of the 10.1 conference was not served on all

parties; therefore, in my opinion, the matter was abandoned.

2