Wood v. Omni Bancshares, Inc.
69 So. 3d 475
La. Ct. App.2011Background
- Adrienne Wood and Glen Wood operated Woody’s Collision Specialists, LLC and related entities under a loan secured by a mortgage on Woody’s property; Omni Bank was the lender and loss payee on insurance proceeds from United Fire Group (UFG).
- A 2002 promissory note for $400,000 secured the loan, and a collateral mortgage required continuous insurance; an authorization resolution initially allowed Adrienne or Glen to sign Woody’s commercial account 8874.
- In 2005 Glen amended the authorization to remove Adrienne from the account; in 2006 a new three-signature resolution for account 6508 was created, with Adrienne alleging an oral agreement with Tappan that UFG insurance proceeds be deposited into account 6508 or escrow 4132.
- UFG issued multiple insurance checks totaling $181,686.48 deposited into 6508; additional checks were deposited into Woody’s 3374 and later diverted to Glen Wood’s personal account.
- Adrienne filed a damages action against Omni and Tappan for breach of contract on July 9, 2008; Omni and Tappan asserted peremptory exceptions and asserted a third-party demand against Glen Wood and Woody’s; the trial court ruled on these exceptions, including after learning of a consent judgment, and the matter was appealed.
- The appellate court reverses the trial court’s rulings on the exceptions and remands for further proceedings, holding that the consent judgment could not be used to support the exception of no cause of action and that Adrienne’s petition adequately stated a breach of contract claim.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the trial court could reconsider its ruling on Omni’s no-cause-of-action exception. | Adrienne argues the initial ruling became law of the case and should not be reconsidered. | Omni contends reconsideration was permissible as per Lab. and due to later disclosures. | Reconsideration allowed; law-of-the-case argument rejected. |
| Whether Adrienne’s petition states a breach-of-contract claim against Omni and Tappan. | Adrienne asserts the petition plausibly alleges a breach of the oral agreement to deposit insurance proceeds. | Omni contends the petition does not state a breach of contract on its face. | Petition states a valid breach-of-contract claim against Omni and Tappan. |
| Whether the third-party demand against Woody’s and Glen Wood was properly dismissed. | Adrienne’s pleadings show reimbursement theories against Woody’s and Wood. | Woody’s and Glen Wood were improperly dismissed from the third-party action. | Dismissal of the third-party demand reversed; third-party claim may proceed. |
| Whether extraneous consent-judgment evidence could be considered in the no-cause-of-action analysis. | Consent judgment should not be treated as evidence for the no-cause-of-action issue. | Consent judgment might influence the court’s understanding of the relationship and actions. | Extraneous consent judgment cannot support a no-cause-of-action ruling; reversal of the ruling. |
Key Cases Cited
- Babineaux v. Pernie-Bailey Drilling Co., 262 So.2d 328 (La. 1972) (interlocutory reconsideration of rulings permitted)
- Louisiana State Bar Ass’n v. Carr and Assocs., Inc., 15 So.3d 158 (La. App. 1 Cir. 2009) (reconsideration of overruling of peremptory exceptions)
- Schell v. N.K. Enterprises, 688 So.2d 68 (La. App. 5 Cir. 1997) (extraneous evidence not admissible to support no-cause-of-action exception)
- Albarado v. Abadie, 703 So.2d 736 (La. App. 5 Cir. 1997) (no-cause-of-action review is on face of petition; facts admitted as true)
- Lambert v. Riverboat Gaming Enforcement Div., 706 So.2d 172 (La. App. 1 Cir. 1997) (standard for no-cause-of-action review; causal sufficiency)
- Ramey v. DeCaire, 869 So.2d 114 (La. 2004) (de novo review of trial court’s ruling on no-cause-of-action)