171 So. 3d 975
La. Ct. App.2015Background
- Arthel Scheuermann died testate; she bequeathed her LLC membership interest in Scheuermann & Jones, LLC to Mark Gonzalez, who was also named an independent executor.
- Gonzalez, both individually and as executor, sued the LLC and surviving member/manager Lawrence Blake Jones for discovery to value the membership interest and for recovery of its value; defendants filed a reconventional demand alleging overpayments to Scheuermann.
- Gonzalez also sought a declaratory judgment that La. R.S. 12:1330 and 12:1333 (LLC assignment and treatment of a deceased member’s interest) are unconstitutional and alternatively asked for a judicial assignment of the membership interest.
- The defendants moved for partial summary judgment under La. C.C.P. art. 966(E) on constitutionality; the trial court granted the motion and labeled the partial summary judgment as final and appealable under La. C.C.P. art. 1915(B), without explaining reasons on the record.
- The Fourth Circuit, on its own motion, issued a rule to show cause and, after de novo review applying Messinger factors and ripeness principles, held the partial summary judgment was improperly designated final because there was just reason for delay; the appeal was dismissed and the court declined to convert it to supervisory review or vacate the interlocutory ruling.
Issues
| Issue | Plaintiff's Argument (Gonzalez) | Defendant's Argument (LLC & Jones) | Held |
|---|---|---|---|
| Whether a partial summary judgment declaring La. R.S. 12:1330 and 12:1333 constitutional was appealable as a final judgment under La. C.C.P. art. 1915(B) | Certification was proper and so the judgment is immediately appealable | Certification was improper because there remained related claims and factual issues; article 1915(B) requires an express determination there is no just reason for delay with reasons | Not appealable: court found there was just reason for delay and dismissal of appeal for lack of appellate right |
| Whether the district court should decide the constitutionality of §§ 1330 and 1333 at this stage (ripeness/fitness) | Immediate resolution needed because statutes potentially block access to LLC records and affect valuation for succession/tax purposes | Decision premature before discovery and resolution of related claims; constitutional ruling might be moot or unnecessary | Issue not fit: court held the record was not sufficiently developed and the constitutional ruling was premature |
| Whether Gonzalez can access the LLC’s books/records to value the membership interest despite §§ 1330–1333 | Statutes conflict with succession procedure, due process, and are vague; executor needs records to inventory and value estate | Access can be obtained via alternative routes (e.g., partnership claim, defending reconventional demand, assignment, or operating agreement issues); statutes presumptively constitutional | Left unresolved on merits: access dispute remains for trial court; interlocutory ruling may be revisited during litigation |
| Whether the appellate court should convert the improper appeal into a supervisory writ or vacate the partial summary judgment | Conversion or vacatur appropriate to obtain immediate review and avoid prejudice | Conversion not appropriate because reversal wouldn’t terminate litigation; vacatur unnecessary since interlocutory rulings are revisable in trial court | Court declined conversion to supervisory review and declined to vacate the interlocutory partial summary judgment |
Key Cases Cited
- R.J. Messinger, Inc. v. Rosenblum, 894 So.2d 1113 (La. 2005) (factors to evaluate certification of partial judgments under Article 1915)
- Ring v. State, Dept. of Transp. and Development, 835 So.2d 423 (La. 2003) (courts should avoid deciding constitutionality when not essential; ripeness doctrine)
- Perschall v. State, 697 So.2d 240 (La. 1997) (discussion of when a ruling becomes moot or abstract)
- La. Associated Gen. Contractors, Inc. v. State, 669 So.2d 1185 (La. 1996) (mootness and practical significance doctrines)
- Favrot v. Favrot, 68 So.3d 1099 (La. App. 4 Cir. 2011) (appealability principles for interlocutory orders)
- Brown v. State, Dept. of Public Safety & Corrections, 680 So.2d 1179 (La. 1996) (presumption of constitutionality of statutes)
- Attain v. Marico Partnership, 851 So.2d 974 (La. 2003) (same)
- Curtiss-Wright Corp. v. General Elec. Co., 446 U.S. 1 (U.S. 1980) (counterclaims’ relevance to finality and setoff considerations)