State of Louisiana, Division of Administration, Office of Community Development - Disaster Recovery Unit v. Michelle Stewart and Raymond Alcindor a/k/a Raymond Marc Stewart ( 2022 )

STATE OF LOUISIANA
mtJ
COURT OF APPEAL
FIRST CIRCUIT
2022 CA 0574
STATE OF LOUISIANA, DIVISION OF ADMINISTRATION
OFFICE OF COMMUNITY DEVELOPMENT - DISASTER
RECOVERY UNIT
1 iII.i.
MICHELLE STEWART AND RAYMOND ALCINDOR A/K/A
RAYMOND MARC STEWART
JUDGMENT RENDERED: DEC 1 5 2022
Appealed from The Twenty -Second Judicial District Court
Parish of St. Tammany • State of Louisiana
Docket Number 2020- 10220 • Division H
The Honorable Alan A. Zaunbrecher, Presiding Judge
Christopher H. Szeto COUNSEL FOR APPELLANTS
Ian G. Dunbar DEFENDANTS— Michelle Alcindor,
New Orleans, Louisiana a/ k/ a Michelle Stewart, and
Raymond Aicindor a/ k/ a Raymond
Marc Stewart
Mary Catherine Cali COUNSEL. FOR APPELLEE
John C. Walsh PLAINTIFF— State of Louisiana,
Caroline M. Tomeny Division of Administration, Office of
William J. Wilson Community Development -Disaster
Jahn C. Conine, Jr. Recovery Unit
Drew D. Lyons
Hunter N. Farrar
Baton Rouge, Louisiana
BEFORE: WELCH, PENZATO, AND LANIER, J.T.
WELCH, J.
In this matter involving an elevation grant awarded under the Road Home
Program for Hurricanes Katrina and Rita victims, the State of Louisiana, through the
Division of Administration, Office of Community Development - Disaster Recovery
Unit, filed suit against the homeowners for an alleged breach of an Elevation
Incentive Agreement, under which the homeowners allegedly received funds to
elevate their home to protect against flood damage. The trial court granted a motion
for summary judgment filed by the State. The homeowners appealed, arguing the
trial court failed to rule on their peremptory exceptions prior to granting summary
judgment in favor of the State. For the following reasons, we reverse and remand.
FACTS AND PROCEDURAL HISTORY
The defendants— Michelle Alcindor ( a/ k/ a Michelle Stewart) and Raymond
Alcindor ( a/ k/ a Raymond Marc Stewart)— are the owners of property located at
7650 Rochon Drive, New Orleans, Louisiana, 70128. Following mass devastation
caused by Hurricane Katrina on August 29, 2005, the Alcindors' home was
damaged, but not destroyed.
In the wake of Hurricanes Katrina and Rita, the State instituted the Road
Home Program— a federally funded program administered by the State to provide
financial assistance to affected homeowners. The Road Home Program offered two
types of grants: compensation grants and elevation grants. On November 20, 2008,
the Alcindors signed a " Declaration of Covenants Running with the Land Hurricane
Katrina / Hurricane Rita" and a " Grant Agreement," which awarded the AIcindors a
9,024. 81 compensation grant to rebuild and reoccupy their home.
The second type of grant -- an elevation grant -- was offered as an incentive
for homeowners in flood -prone areas to elevate their homes to a level that met or
exceeded the Advisory Base Flood Elevation established by the Federal Emergency
Management Agency (" FEMA"). The terms of the elevation grant were set forth in
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an Elevation Incentive Agreement form. The Alcindors signed a document titled
Elevation Incentive Agreement - For Use with Prior Road Home Grant" on
December 31, 2008, agreeing to elevate their home within three years to a level at
or above the Advisory Base Flood Elevation established by FEMA. The Alcindors
allegedly received elevation grant funds in the amount of $30, 000.00.
Eleven years later, on January 15, 2020, the State filed suit against the
Alcindors for breach of contract. The essence of the State' s suit is that the Elevation
Incentive Agreement required the Alcindors to elevate their home within three years
of signing and that the Alcindors breached the agreement by failing to comply with
its terms. The State sought judgment against the Alcindors in the full sum of
30, 000. 00 in elevation grant funds, with legal interest from the date of judicial
demand until paid, together with reasonable attorney fees and for all costs of the
proceedings.
After the Alcindors filed an answer,' the State filed a motion for summary
judgment, arguing there were no genuine issues of material fact that the Alcindors
failed to demonstrate they complied with the terms of the Elevation Incentive
Agreement by showing the elevation of their home for which the funds were
awarded, nor had the Alcindors repaid the $ 30, 000. 00 elevation grant or made any
arrangements for repayment.
The Alcindors filed an opposition to the State' s motion for summary judgment
on July 28, 2021, arguing that while they did apply for and sign an agreement to
receive a compensation grant, they did not recall signing an Elevation Incentive
Agreement, nor did they ever receive a $ 30, 000. 00 elevation grant. The Alcindors
contended that the elevation of their home had never been established. The Alcindors
also argued that there were genuine issues of material fact as to whether the State' s
t It appears that at the time the Alcindors filed their answer on February 4, 2020, they did not have
legal representation.
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claim had prescribed under La. C. C. art. 3499; 2 was preempted by La. R.S. 9: 2772;3
and was barred by res judicata via a compromise.' The Alcindors also raised the
affirmative defenses of negligent misrepresentation and detrimental reliance.
Finally, the Alcindors objected to the affidavit of the Chief Operating Officer of the
Office of Community Development -Disaster Recovery Unit, Jeff Haley, and the
documents attached thereto ( OCD -DRU -1 to 19) that the State submitted in support
of its motion.
In a reply memorandum to the Alcindors' opposition to its motion for
summary judgment, the State objected to any document referenced by the Alcindors
that was not an affidavit or certified or attached to an affidavit. The State also
objected to portions of the affidavits of the Alcindors.
1 A personal action, such as a claim for a breach of contract, is a personal action subject to a
liberative prescription of ten years. See La. C. C. art. 3499; CWI Holdings, LLC v. Robertson
Dev., L.L.C., 2021- 0569 ( La. App. ls` Cir. 12122121), 340 So. 3d 47, 49 n. 1. The Alcindors signed
the Elevation Incentive Agreement on December 31, 2008, and had three years from that date to
elevate their home to a level at or above the Advisory Base Flood Elevation established by FEMA.
The Alcindors argue, however, that a breach could have occurred at the time they signed the
agreement if the elevation of their home already met or exceeded the Advisory Base Flood
Elevation established by FEMA. The Alcindors contend that there is no survey or elevation
certificate establishing the actual elevation of their home at any time— not at the time they signed
the Elevation Incentive Agreement, nor any time thereafter. Thus, they argue there are genuine
issues of material fact as to whether the State' s claim is prescribed by the ten-year prescriptive
period set forth in La. C. C. art. 3499.
3 Louisiana Revised Statutes 9:2772 provides a five-year peremptive period for actions involving
deficiencies in surveying, design, supervision, or construction of immovables or improvements
thereon against any person performing or furnishing land surveying services. The Alcindors allege
that there are several cases pending before the Louisiana Fifth Circuit Court of Appeal as to
whether La. R.S, 9: 2772' s five- year peremptive period for actions against land surveyors applies
to the State' s breach of contract claims against homeowners who accepted elevation funds under
the Road Home Program. We note that the Fourth Circuit Court of Appeal has already decided this
issue, molding that La. R. S. 9: 2772' s five- year peremptive period does not apply to these types of
claims. See State v. Porter, 2022- 0250 ( La. App. 4ch Cir. 9/ 7/ 22), So. 3d , 2022 WL
4091995.
The Alcindors argue that they accepted a compromise offered by the State in an October 14, 2016
letter, which stated, in pertinent part:
2. If Grant Recipient... used the RHEI funds to finish the repairs to the hoine:
a. Provide proof of payment documentation ( i. e. contracts, receipts,
canceled checks, or bank statements) on all of the repair or reconstruction
work done on the home... .
The Alcindors argued they accepted the State' s compromise and used the elevation grant funds to
repair their home. Thus, there is a genuine issue of material fact as to whether the State' s claim is
barred by res judicata via a compromise.
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On August 11, 2021— the day before the motion for summary judgment
hearing— the Alcindors filed a peremptory exception raising the objections of
prescription pursuant to La. C. C. art. 1564; peremption by La. R. S. 9: 2772; and no
cause of action. The Alcindors argued that the grants awarded to homeowners under
the Road Home Program were gratuitous donations from a disaster relief agency;
thus, under La. C. C. art. 1564' s five-year prescriptive period for an action to dissolve
a donation for failure to fulfill the condition or perform the charges, the State' s claim
is prescribed. The Alcindors further argued that La. R.S. 9: 2772' s five-year
peremptive period for actions on improvements to immovable property applied to
the State' s breach of contract claims against homeowners who accepted elevation
funds under the Road Home Program. Finally, the Alcindors argued that the State' s
petition failed to allege sufficient facts to establish the Alcindors failed to elevate
their home or provide proof of elevation of their home. The State did not allege facts
or attach any survey or elevation certification to its petition establishing the actual
elevation ofthe Alcindors' home at any time— not at the time the Elevation Incentive
Agreement was signed, nor any time thereafter.
At the August 12, 2021 hearing, the trial court ruled on the objected to
evidence.' The trial court overruled the Alcindors' objection to the affidavit of Jeff
Haley, and the documents attached thereto, that the State submitted in support of its
motion. The trial court sustained the State' s objections to the Alcindors' exhibits that
were not attached to an affidavit. The trial court then noted that it was not
considering the Alcindors' peremptory exceptions raising the objections of
prescription, peremption, and no cause of action; the trial court proceeded to hear
arguments on the State' s motion for summary judgment. At the conclusion of the
hearing, the trial court granted the State' s motion for summary judgment.
5 See La. C.C. P. art. 966( D)( 2) (" The court shall consider all objections prior to rendering
judgment. The court shall specifically state on the record or in writing which documents, if any, it
held to be inadmissible or declined to consider.").
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The trial court signed a judgment in accordance with its oral ruling on
September 17, 2021, granting the State' s motion for summary judgment and
rendering judgment in favor of the State and against the Alcindors in the amount of
30,000. 00, together with legal interest from the date of judicial demand, January
15, 2020, until paid, plus $ 750. 00 in attorney fees, and all costs of the proceedings.
The trial court provided written reasons for ruling on October 19, 2021. As to the
Alcindors' peremptory exceptions, on each of the proposed orders to set the
exceptions for hearing,' the trial court handwrote " Rule to Show Cause Denied.
Exception not considered." and indicated that the State' s motion for summary
judgment was granted in open court on August 12, 2021. The Alcindors now appeal.'
LAW AND DISCUSSION
When an unrestricted appeal is taken from a final judgment, the appellant is
entitled to seek review of all adverse interlocutory judgments prejudicial to him, in
addition to the review of the final judgment. Judson v. Davis, 2004- 1699 ( La. App.
I" Cir. 6129105), 916 So. 2d 1106, 1112, writ denied, 2005- 1998 ( La. 2110106), 924
So. 2d 167. In conjunction with their appeal of the trial court' s September 17, 2021
judgment, the Alcindors also seek review of the trial court' s denial of their
peremptory exception raising the objections of prescription, peremption, and no
cause of action. In their first assignment of error on appeal, the Alcindors argue that
the trial court erred in failing to hold a hearing and rule on their peremptory
exceptions prior to deciding the State' s motion for summary judgment. We agree.
6 See La. Dist. Court Rules, Rule 9. 8 (" All— motions ... shall be accompanied by a proposed order
requesting that the ... motion be set for hearing.").
7 The Alcindors filed a supervisory writ application with this court, seeking review of the trial
court' s decision that overruled their peremptory exception urging peremption. This court granted
the Alcindors' writ application with an order remanding the case for the limited purpose of
instructing the trial court to grant the Alcindors an appeal of the September 17, 2021 judgment, so
the Alcindors could seek review of any adverse interlocutory ruling in conjunction with an appeal
of the final judgment. See State v. Stewart, 2021- 1372 ( La. App. 1St Cir. 2114/ 22), 2022 WL
444399 ( unpublished writ action). Thereafter, the Alcindors filed a motion for a devolutive appeal
on March 11, 2022. The trial court signed an order of appeal on March 21, 2022, notice of which
was transmitted by the Clerk of Court to the parties on March 25, 2022.
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Article 921 of the Louisiana Code of Civil Procedure states in part that "[ a] n
exception is a means of defense ... used by the defendant ...to— defeat the demand
brought against him." The function of the peremptory exception is to have a
plaintiff' s action declared legally nonexistent, or barred by effect of law; hence, a
peremptory exception tends to dismiss or defeat the action. La. C. C. P. art. 923. The
peremptory exception may be pleaded at any stage of the proceeding in the trial court
prior to a submission of the case for a decision. La. C. C. P. art. 928. Louisiana Code
of Civil Procedure article 929( B) provides that if a peremptory exception is filed
after the answer, but at or prior to trial of the case, it shall be tried and disposed of
either in advance of or on the trial of the case.
A motion for summary judgment is a procedural device used to avoid a full-
scale trial when there is no genuine factual dispute, Naquin v. Louisiana Power &
Light Co., 98- 2270 ( La. App. 1St Cir. 3131100), 768 So. 2d 605, 607, writ denied,
2000- 1741 ( La. 9115100), 769 So. 2d 546. The summary judgment procedure is
favored and is designed to secure the just, speedy, and inexpensive determination of
every action. La. C. C. P. art. 966( A)(2); Naquin, 768 So. 2d at 60V
Here, the Alcindors filed an answer; then, the State filed a motion for
summary judgment, which if granted, would have disposed of its entire case against
the Alcindors. Thereafter, the Alcindors filed their peremptory exceptions. Because
the Alcindors filed an answer prior to filing the peremptory exceptions, the
provisions of La. C. C. P. art. 929( B) are triggered. Accordingly, the trial court was
required to rule on the Alcindors' peremptory exceptionsrip or to or at a trial on the
merits of the State' s motion for summary judgment. See La. C. C. P. art. 929( B); see
S Appellate courts review summary judgments de novo, using the same criteria that govern the trial
court' s consideration of whether summary judgment is appropriate. Bozarth v. State LSU
Medical Center/Chabert Medical Center, 2009- 1393 ( La. App. 1St Cir. 2112110), 35 So. 3d 316,
323. The motion should be granted only if the pleadings, depositions, answers to interrogatories,
and admissions on file, together with the affidavits, if any, show that there is no genuine issue as
to material fact, and that the mover is entitled to judgment as a matter of law. La. C. C. P. art.
966( A)( 3) and ( 4); Bozarth, 35 So. 3d at 323.
F
also, e.g., Tanner v. Morgan, 2018- 1719 ( La. App. I` Cir. 7/ 10/ 19), 280 So. 3d
1237; Breen v. Breen, 2018- 1322 ( La. App. 1st Cir. 12126118), 2018 WL 6818902,
at * I( unpublished writ action); Williams v. Genuine Parts Co., 2014- 0857 ( La.
App. Pt Cir. 118115), 2015 WL 1. 27974, at * 4 ( unpublished). 9 A hearing or trial of
an exception ( other than the exception of no cause of action) is just that— a trial at
which competent, relevant evidence should be presented for the trier of fact' s
consideration. See La. C. C. P. arts. 930, 931. Kirby v. Field, 2004- 1898 ( La. App.
1St Cir. 9123/ 05), 923 So. 2d 131, 137 n. 8, writ denied, 2005- 2467 ( La. 3/ 24106), 925
So. 2d 1230.
Therefore, we must reverse the trial court' s orders denying the Alcindors'
peremptory exceptions; reverse the trial court' s September 17, 2021 judgment
granting the State' s motion for summary judgment; and remand this matter to the
trial court with instructions to conduct a trial on the Alcindors' peremptory
exceptions in advance of, or, at a trial on the merits of the State' s motion for
summary judgment. 1°
DECREE
We reverse the trial court' s August 13, 2021 orders, which overruled the
peremptory exceptions raising the objections of prescription, peremption, and no
9 See also Tanner v. Morgan, 2018- 1719 ( La. App. I" Cir. 7110119), 280 So. 3d 1237, 1238 ( when
defendant -in -reconvention asserted peremptory exceptions of no cause of action and no right of
action in his answer, trial court erred in failing to conduct a hearing on the exceptions prior to the
hearing on the merits of defendants' motion for partial summary judgment as mandated by La.
C. C. P. art. 929( A)). But compare State v. Zanders, 2021- 0336 ( La. App 1St Cir. 12122121), 339
So. 3d 1194, 1199, a similar Road Home case wherein this court held that the trial court did not err
by declining to hold a hearing on the peremptory exceptions of prescription and peremption prior
to ruling on the merits of the State' s motion for partial summary judgment. Zanders is
distinguishable from the instant case, however, because the record in Zanders clearly established
that the trial court consider the defendants' arguments on prescription and peremption ( prior to
hearing arguments on the motion for partial summary judgment), and found those arguments to be
without merit. " Based on these unique facts and circumstances, we find no error by the district
court ruling on the motion for summary judgment without first having a hearing on the exceptions."
Id.10 We pretermit discussion of the Alcindors' remaining assignments of error.
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cause of action filed by the defendants, Michelle Alcindor, a/ k/a Michelle Stewart,
and Raymond Alcindor, a/ k/a Raymond Marc Stewart.
We reverse the trial court' s September 17, 2021 judgment, which granted a
motion for summary judgment and rendered judgment in favor of the State of
Louisiana, through the Division of Administration, Office of Community
Development - Disaster Recovery Unit, and against Michelle Stewart and Raymond
Alcindor, a/ k/ a Raymond Marc Stewart, in the amount of $30, 000.00, together with
legal interest from the date of judicial demand, January 15, 2020, until paid, plus
750. 00 in attorney fees, and all costs of the proceedings.
We remand this matter to the trial court with instructions to conduct a trial on
the Alcindors' peremptory exceptions in advance of, or, at a trial on the merits of the
State' s motion for summary judgment.
REVERSED AND REMANDED WITH INSTRUCTIONS.
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