72 So. 3d 478
La. Ct. App.2011Background
- Doucet invested about $120,882 in Resort Holding International (RHI) unit leases through First Federal Guaranty (FFG) in 2003–2004, seeking principal safety and steady income.
- Huguet, FFG’s agent, solicited the investment and made representations about RHI’s safety, guaranteed 9% income, and prompt liquidity; he did not disclose FFG’s lack of securities licenses or the sales commissions.
- The Purchase Agreement with Comercializadora Vacacional Panama (CVP) included a broad release for claims against RHI and CVP, but the trial court found Huguet was not an intended released party.
- Doucet subsequently settled with other defendants (FFG, the Comptons, and Pizzolato) for a total of $70,000, leaving only Huguet at issue.
- A one-day bench trial resulted in a judgment against Huguet for damages, attorney’s fees, and costs totaling $49,323, which the court later amended on appeal.
- The court ultimately amended the damages to $41,496, with interest and costs, and held that damages for mental anguish are not permissible under the securities statute.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the release barred Doucet’s claims against Huguet. | Doucet argues Huguet was not released by the Purchase Agreement. | Huguet contends he was released as an agent/representative. | Release did not bar Doucet against Huguet; denial of involuntary dismissal affirmed. |
| Whether the damages awarded were properly calculated. | Doucet advocates the jury/experts’ rescission or benefit‑of‑the‑bargain methods, with credits for settlements. | Huguet argues damages should reflect net investment minus income plus interest and costs, with settlement credits. | Court erred; damages amended to $41,496 plus interest and costs. |
| Whether Doucet could recover damages for mental anguish under RS 51:714. | Doucet seeks damages for mental anguish as part of the securities claim. | Mental anguish damages are not provided by RS 51:714. | Trial court lacked authority to award mental anguish; reversed on that point. |
Key Cases Cited
- Trahan v. Coca Cola Bottling Co. United, Inc., 894 So.2d 1096 (La. 2005) (examines the scope of releases and intended settlements in compromises)
- Johnson v. First Nat. Bank of Shreveport, 792 So.2d 33 (La. App. 3 Cir. 2001) (fraud damages not expressly governed under securities law)
- Norfleet v. Lifeguard Transp. Service, Inc., 934 So.2d 846 (La. App. 4 Cir. 2006) (reasonableness of attorney’s fees in contingency cases)
- Daniel v. Wal‑Mart Stores, Inc., 833 So.2d 1047 (La. App. 2 Cir. 2002) (statutory framework governs recovery and where general rules yield to specific statute)