Opinion
NO. 21-CA-698
05-16-2023
STATE of Louisiana, Division of Administration, Office of Community Development - Disaster Recovery Unit v. David MCCREA A/k/a David Michael McCrea
COUNSEL FOR PLAINTIFF/APPELLEE, STATE OF LOUISIANA, DIVISION OF ADMINISTRATION, OFFICE OF COMMUNITY DEVELOPMENT - DISASTER RECOVERY UNIT ('OCD - DRU") Mary C. Cali, Baton Rouge, LAJohn C. Walsh Caroline M. Tomeny, Baton Rouge, LA,William J. Wilson John C. Conine, Jr.Drew D. Lyons, Baton Rouge, LAHunter Farrar COUNSEL FOR DEFENDANT/APPELLANT, DAVID M. MCCREA Christopher H. Szeto Ian Dunbar
COUNSEL FOR PLAINTIFF/APPELLEE, STATE OF LOUISIANA, DIVISION OF ADMINISTRATION, OFFICE OF COMMUNITY DEVELOPMENT - DISASTER RECOVERY UNIT ('OCD - DRU") Mary C. Cali, Baton Rouge, LAJohn C. Walsh Caroline M. Tomeny, Baton Rouge, LA,William J. Wilson John C. Conine, Jr.Drew D. Lyons, Baton Rouge, LAHunter Farrar
COUNSEL FOR DEFENDANT/APPELLANT, DAVID M. MCCREA Christopher H. Szeto Ian Dunbar
Panel composed of Judges Susan M. Chehardy, Jude G. Gravois, Marc E. Johnson, Robert A. Chaisson, Stephen J. Windhorst, John J. Molaison, Jr., and Cornelius E. Regan, Pro Tempore
ROBERT A. CHAISSON, JUDGE
CHAISSON, J.
This appeal arises from an action brought by the State of Louisiana, Division of Administration, Office of Community Development – Disaster Recovery Unit ("OCD-DRU") against David McCrea seeking enforcement of a $30,000.00 stipulated damages provision of a Road Home Program Grant Elevation Incentive Agreement under which Mr. McCrea, whose home had been damaged by Hurricanes Katrina and Rita, received federal disaster relief funds in exchange for agreeing to elevate his home at or above base flood elevations published by FEMA.
BACKGROUND
On June 23, 2008, David McCrea signed an Elevation Incentive Agreement with OCD-DRU Road Home Program representatives, wherein he received a grant of $30,000.00 in exchange for promises to elevate his home within three years and to make all repairs in conformity with the minimum standards set by the 2003 International Residential Building Code.
On December 11, 2020, OCD-DRU filed this suit for breach of contract against Mr. McCrea seeking $30,000.00 in stipulated damages, attorney's fees and costs, as well as "any sums ... which may be due by the Defendant pursuant to any other Grant, Incentive, or Mitigation Program..." for his alleged failure to demonstrate compliance with the work set forth in the Elevation Incentive Agreement. Subsequently, the State filed a motion for summary judgment against Mr. McCrea.
On August 25, 2021, following a hearing, the trial court rendered judgment granting the State's motion for summary judgment and ordering Mr. McCrea to pay $30,000.00, as well as legal interest and $1,000.00 in attorney's fees and all costs of the proceedings. The State subsequently recorded the judgment in itsfavor in the mortgage records of Jefferson Parish at Book 4956 Folio 69. Mr. McCrea filed an appeal from this judgment.
On May 3, 2023, the State filed a Motion and Order to Remand for Dismissal requesting that the judgment of the lower court be vacated and that the matter be remanded to the trial court "so that OCD-DRU may dismiss its suit against Defendant – Appellant DAVID MICHAEL MCCREA and cancel the recorded judgment." The State attached to its motion a copy of the Motion and Order for Dismissal to be filed with the trial court, which states that this proceeding is to be dismissed with prejudice at the State's costs. Also attached to its motion is a copy of the Request to Cancel Inscription and a copy of the Release by Obligee of Record of an Unparaphed Obligation, which the State indicates it will file with the Clerk of Court and Recorder of Mortgages, in order to cancel the inscription of the judgment in the mortgage records of Jefferson Parish.
We take judicial notice of the fact that it has been widely reported by local media that the State, with the concurrence of the U.S. Department of Housing and Urban Development, has agreed to forego further legal actions and release 3,300 homeowners from their Road Home Program debt obligations.
On the same date that the State filed its Motion and Order to Remand for Dismissal, Mr. McCrea's counsel filed a letter with this Court indicating that he "consents to the motion and order to remand for dismissal filed today by the Appellee in this matter without objection " (emphasis added). Counsel's letter further states that they agree to the State's motion because of "the inclusion of a release and request for cancellation which states:
We note that Mr. McCrea consents to the State's motion without objection , despite the fact that the State's Motion requests that the judgment be vacated. In a separate appeal pending before this Court, State of Louisiana, Division of Administration, Office of Community Development – Disaster Recovery Unit v. Kiesha N. Moreira , No. 22-CA-245, ––– So.3d ––––, 2023 WL 3556887, which concerns a judgment that also arises out of the Road Home Grant Elevation Incentive Program, the State has filed a Motion and Order to Remand For Dismissal in which the State requests that the judgment be vacated by this Court. In that matter, Ms. Moreira, represented by the same counsel as Mr. McCrea, has filed a Limited Opposition to the State's Motion, correctly pointing out that "a motion to vacate is not a proper procedural mechanism and does not exist under Louisiana law." We agree with this contention and, finding such action to be unnecessary in this Court in order to dismiss this appeal, decline to do so.
The undersigned [i.e. OCD-DRU] acknowledges that he/she is liable to and shall indemnify the Recorder of Mortgages and any person relying on this request for cancellation for any damages they may suffer as a consequence of such reliance in accordance with the provisions of La. R.S. 9:5174." (emphasis in original letter).
Although Mr. McCrea grants his consent to the State's motion conditioned upon the inclusion of the above-quoted language, we find that his interpretation of the nature of the quoted indemnification language is misplaced. This indemnification provision is specifically to protect the Recorder of Mortgages, and any other person who is damaged by reliance on the request for cancellation (which, by its very nature, would not include Mr. McCrea himself), by virtue of an erroneous request to cancel the inscription.
Consequently, the indemnification language quoted by Mr. McCrea's counsel in his letter of consent to the State's motion is not the provision that provides Mr. McCrea protection against any future liability on the judgment at issue. Rather, it is the statement in the State's motion that indicates it is moving to dismiss the appeal and remand to the trial court for the express purpose of dismissing the litigation, with prejudice, at the State's cost, and the release language in the attached Release by Obligee of Record of an Unparaphed Obligation, which states that "the mortgage or privilege was paid, extinguished , or otherwise satisfied " and that "the obligation secured by the mortgage or privilege is hereby released " (emphasis added).
We note that in Ms. Moreira's opposition to the State's Motion to Remand in State v. Moreira , No. 22-CA-245, she indicates that she would consent to the State's motion if it included a release with indemnification like the one attached to the State's motion in this matter. In the Moreira case, a Request to Cancel Inscription and a Release by Obligee of Record of an Unparaphed Obligation (pursuant to La. R.S. 9:5169 ) would not be appropriate, and frankly would be meaningless to the Clerk of Court and Recorder of Mortgages because the judgment in that case was not recorded in the mortgage records; however, we agree that including language in the Motion to Remand for Dismissal stating that the "judgment was extinguished or otherwise satisfied and the obligation is therefore released" would be appropriate to allay any concerns Ms. Moreira may have regarding potential future liability on the judgment.
DECREE
Accordingly, without consideration of the merits of this case, we hereby partially grant the State's Motion and Order to Remand for Dismissal insofar as we dismiss this appeal and remand the foregoing matter to the trial court for the express purpose of Plaintiff-Appellee, State of Louisiana, Division of Administration, Office of Community Development – Disaster Recovery Unit, dismissing the suit filed against Defendant-Appellant, David McCrea, with prejudice and at its costs, and for cancellation of the inscription in the mortgage records of Jefferson Parish at Book 4956 Folio 69. Further, we partially deny the State's motion insofar as it requests this Court to vacate the August 25, 2021 judgment of the trial court. All costs of these proceedings are assessed to Appellee.
NOTICE OF JUDGMENT AND CERTIFICATE OF DELIVERY
I CERTIFY THAT A COPY OF THE OPINION IN THE BELOW-NUMBERED MATTER HAS BEEN DELIVERED IN ACCORDANCE WITH UNIFORM RULES - COURT OF APPEAL, RULE 2-16.4 AND 2-16.5 THIS DAY MAY 16, 2023 TO THE TRIAL JUDGE, CLERK OF COURT, COUNSEL OF RECORD AND ALL PARTIES NOT REPRESENTED BY COUNSEL, AS LISTED BELOW: