Benton v. Clay
123 So. 3d 212
| La. Ct. App. | 2013Background
- Benton and Calvin Clay agreed at a timber-land auction to purchase a 29-acre tract together; both signed the Purchase and Sale Agreement and paid earnest money.
- Benton withdrew $18,000 from her 401(k) and had funds available; Clay was the designated contact with the title company (Hudson Lane).
- Clay allegedly told Hudson Lane Benton could not afford her share; the Clays closed alone on August 15, 2007, took out a mortgage for the full purchase price, sold timber, and used the land.
- Benton sued to set aside the sale, obtain specific performance (1/2 undivided interest), and damages; the Clays later impleaded Hudson Lane for malpractice/indemnity/contribution.
- Trial court found Clay knowingly misrepresented Benton’s participation, breached the joint-purchase agreement in bad faith, awarded Benton specific performance and damages (including half timber proceeds), dismissed Clays’ third-party claims against Hudson Lane as prescribed, but also awarded Benton attorney fees.
Issues
| Issue | Benton’s Argument | Clay’s Argument | Held |
|---|---|---|---|
| Whether Clay’s conduct constituted intentional misrepresentation/fraud | Clay knowingly told title co. Benton wasn’t participating; Benton relied and suffered loss | Benton didn’t prove fraud or intent; Clay claimed ignorance | Trial court’s credibility findings upheld; Clay knowingly misrepresented and acted in bad faith/fraudulent manner |
| Whether Benton is entitled to specific performance / detrimental reliance | Agreement to co-purchase existed; Benton relied (paid earnest money, withdrew funds); specific performance practicable | Agreement was oral or lacked required formalities; land changed/encumbered making specific performance impracticable | Court found a valid enforceable agreement and alternatively detrimental reliance; specific performance ordered (1/2 interest free of encumbrances) |
| Damages and attorney fees award to Benton | Entitled to damages and fees due to bad faith/fraud | Damages limited (e.g., earnest money only); no statutory basis for attorney fees | Damages (including 1/2 timber proceeds) affirmed; attorney fees reversed (no statutory/contractual basis) |
| Whether Clays’ third-party claims vs. Hudson Lane were barred or viable | Indemnity/contribution claim accrues at judgment; malpractice/tort claims timely | Claims against title co. were prescribed/perempted or lacked right of action | Trial court correctly dismissed Clays’ damages claims as prescribed and found no right to contribution/indemnity under current law; dismissal affirmed |
Key Cases Cited
- Rosell v. ESCO, 549 So.2d 840 (La. 1989) (appellate review of trial court fact findings — manifest error standard)
- Suire v. Lafayette City-Parish Consol. Gov’t, 907 So.2d 37 (La. 2005) (elements and availability of detrimental reliance)
- Dumas v. State ex rel. Dept. of Culture, Recreation, & Tourism, 828 So.2d 530 (La. 2002) (abolition of solidarity among non-intentional tortfeasors)
- Boudreaux v. Jeff, 884 So.2d 665 (La. App. 1st Cir. 2004) (fraud/suppression principles and burdens)
- Welch v. Willis-Knighton Pierremont, 56 So.3d 242 (La. App. 2d Cir. 2010) (deference to factfinder when evidence permits two views)
- Automatic Coin Enter., Inc. v. Vend-Tronics, Inc., 433 So.2d 766 (La. App. 5th Cir. 1983) (fraud by promises not intended to be performed)