215 So. 3d 939
La. Ct. App.2017Background
- KLLC (Krebs, Lasalle, Lemieux Consultants, Inc.) was dissolved by affidavit in Jefferson Parish circa December 26, 2012 under former La. R.S. 12:142.1.
- In May 2016 KLLC’s designated representatives petitioned the district court to reinstate the corporation; the petition asserted the pre-repeal statute (La. R.S. 12:142.1) governed reinstatement.
- The Louisiana Legislature repealed La. R.S. 12:142.1 and enacted the Business Corporations Act, including La. R.S. 12:1-1444, effective January 1, 2015; the new law limits reinstatement to requests made within three years of termination.
- The district court denied KLLC’s petition on June 13, 2016, applying the new statute’s three-year limit; KLLC appealed.
- This court concluded that the law in effect at the time of dissolution (former La. R.S. 12:142.1) governs KLLC’s ability to seek reinstatement and that KLLC may pursue reinstatement, subject to proving a valid and lawful purpose.
- The court vacated the district court’s order and remanded, directing that KLLC be given a reasonable opportunity to seek an evidentiary hearing to present evidence of a lawful purpose for reinstatement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the new Business Corporations Act (La. R.S. 12:1-1444) applies to KLLC’s 2012 dissolution | KLLC: the law in effect at dissolution (former R.S. 12:142.1) controls; new statute should not bar reinstatement | State/District Court: new statute’s 3‑year limitation bars reinstatement because it governs reinstatement requests | Held: Former R.S. 12:142.1 governs KLLC’s capacity to seek reinstatement; R.S. 12:1-1444 does not apply to KLLC’s pre‑enactment dissolution |
| Whether the repeal and new statute should apply retroactively | KLLC: repeal should not cut off a right accrued under prior law | State: application of the new statute is proper to limit reinstatement | Held: Transitional provisions and Civil Code art. 6 support prospective application; the new time limit is substantive and thus not retroactive |
| Standard/burden for reinstatement | KLLC: entitled to pursue reinstatement and to present reasons (e.g., maintain pending suit) | State: dismissal appropriate absent compliance with new limits | Held: KLLC must produce evidence of a valid and lawful purpose for reinstatement; burden on petitioner |
| Remedy and process | KLLC: requested reinstatement proceeding | State: proceeded to deny petition without evidentiary hearing | Held: Vacate denial and remand so KLLC may obtain a reasonable opportunity for an evidentiary hearing on purpose for reinstatement |
Key Cases Cited
- In re Reinstatement of S & D Roofing, LLC, 202 So.3d 177 (La. App. 5 Cir. 2016) (standards for reinstatement and factual inquiry)
- Krebs, Lasalle, Lemieux Consultants, Inc. v. G.E.C., Inc., 197 So.3d 829 (La. App. 5 Cir. 2016) (prior panel holding that former R.S. 12:142.1 applied to KLLC’s pre‑enactment dissolution)
- In re Reinstatement of Southern Labor Servs., L.L.C., 142 So.3d 60 (La. App. 5 Cir. 2014) (evidentiary hearing required before reinstatement)
- Manuel v. Louisiana Sheriff’s Risk Management Fund, 664 So.2d 81 (La. 1995) (retroactivity rules and Civil Code art. 6)
- Sawicki v. K/S Stavanger Prince, 802 So.2d 598 (La. 2001) (analysis when legislature’s intent on retroactivity is not explicit)
- Butcher v. Keith Hebert Carpentry/Vinyl Siding, Inc., 945 So.2d 914 (La. App. 3 Cir. 2006) (dissolution by affidavit does not absolve shareholders of personal liability)
- In re Reinstatement of Venture Assocs., 906 So.2d 498 (La. App. 1 Cir. 2005) (maintaining a pending lawsuit is a valid purpose for reinstatement)