Opinion
CIVIL ACTION NO. 02-2170, BANKRUPTCY NO. 00-1250, SECTION "K" (4)
February 4, 2003
ORDER AND REASONS
Before the Court is an appeal from a judgment of the United States Bankruptcy Court Eastern District of Louisiana entered on May 20, 2002 in Adversary Proceeding No. 00-1250 in favor of Schwegmann Giant Supermarkets Partnership (Schwegmann) and against Robert J. d'Hemecourt and Margaret Grenier d'Hemecourt ("d'Hemecourt") and further dismissing d'Hemecourt's reconventional demand against Schwegmann. For the following reasons, the Court affirms the Bankruptcy Court with respect to its denial of plaintiff s request to dismiss and remand this matter to state court; however, the Court reverses the decision of the bankruptcy court on the merits and remands the matter for a new trial.
BACKGROUND
Robert d'Hemecourt acted as a consultant for John Schwegmann (Mr. Schwegmann) and Schwegmann Gaint Supermarkets for a number of years. One project in which d'Hemecourt was involved had to do with the supply of gasline to Schwegmann stores. Mr. Shwegmann determined that having nationally marked gasline would be advantageous to increase gas sales. D'Hemecourt introduced Schwegmann to Amoco, and Schwegmann and Amoco entered into an arrangement.
In 1986, Amoco decided to cease its retail operations in Louisiana, and Schwegmann used d'Hemecourt's services to procure another supplier. A number of oil companies were contacted by d'Hemecoutt and eventually a contract was signed between Texaco and Schwegmann on April 14, 1986. Mr. Schwegmann and d'Hemecourt came to an arrangement that a portion of the profits would inure to the benefit of d'Hemecourt. Discussions memorialized in notes dated April 14, 1986, initialed by Samuel Levy, president of Schwegmann's in 1986, read:
Presently Amoco vs. Schwegmann w/all disc. stands at 15.5 full margin.
Loan w/Bob is $150,000.00
Profit w/Texaco should be at least $150,000.00 of Bob pays difference plus interest.
Texaco vs. Schwegmann full margin w/all discounts should 17.2 base on gasline report of w/ending 1/12/86(w/28)Gallons Sold Grs. Profit $ Full margin 14,432 21,134.03 14.4+.01 rebate 2,884.62 (15.4) _________ 24,018.65 16.4+01 rebate (17.4) If over all profit increases by 456,867.84 Bob pays no interest on Loan.
(Defendants' Exhibit 1). D'Hemecourt maintains that the 2 cent differential or added profit was his commission for facilitating the Schwegmann-Texaco contract.
On that same day, April 14, 1986, a demand note in favor of Schwegmann in the amount of $150,000 was signed by Robert d'Hemecourt and that amount of money was received by d'Hemecourt. The note initially had "none" noted as the amount of interest due. That notation was scratched out, and the amount of 10% was written in. It is unclear when this change was made; however, from a review of the documents and copies involved, it would appear that the change was made at the same time.
A business relationship continued between d'Hemecourt and Schwegmann for a number of years. D'Hemecourt continued to act as a consultant for Mr. Schwegrnann. No demand for an accounting for moneys allegedly due from Schwegmann to d'Hemecourt for the "profits" under the Texaco-Schwegmann contract were made; likewise, Schwegmann made no demand for any payment on the note. The Texaco-Schwegmann gasoline relationship continued for about 11 years.
On March 16, 1990, the Chief Financial Officer David Erath of Schwegmann sent the following letter to d'Hemecourt:
As you may be aware, in the absence of other activity, demand notes become unenforceable after five years. It is, therefore, necessary, and we hereby request, that you kindly execute the enclosed acknowledgment. It is also necessary that the enclosed note copy be initialed and your initials dated.
I realize that this is a bit premature, but I am gradually trying to get the house in order, and would like to put this matter to bed for a while.
Your cooperation will be greatly appreciated, and please do not hesitate to call if you have any questions.
(Defendants' Exhibit 13). D'Hemecourt did not return the acknowledgment as requested. At a restaurant in New Orleans, Mr. Schwegmann met with d'Hemecourt on September 11, 1990, and d'Hemecourt signed an acknowledgment of the note and interest. No mention or notation of the Texaco profits and their effect on the amount due under the note were made. D'Hemecourt and Schwegmann's business relationship eventually deteriorated resulting in the instant lawsuit.
Procedural Background
On August 10, 1995, Schwegmann filed suit to collect on the note. The suit was not served immediately. On May 5, 1998, an answer and reconventional demand based on, inter alia, d'Hemecourt's claim for compensation under the Texaco-Schwegmann's contract was filed by d'Hemecourt. Significant discovery occurred in this matter including the depositions of Schwegmann and Levy, and a motion to compel was filed and granted by the state court based on Schwegmann's alleged failure to produce the necessary records with respect to gasoline sales at the stores. On July 22, 1999, Schwegmann filed a Motion to Set for Trial in the Orleans Parish proceeding.
On September 20, 2000, Schwegmann filed for relief under Chapter 11 of the United States Bankruptcy Code. On December 8, 2000, an Application for Removal of the state court proceeding to the United States District Court for the Eastern District of Louisiana was filed in the United States District Court for the Eastern District of Louisiana. The case was then transferred to Bankruptcy Court; on December 11, 2000, it was assigned adversary proceeding number 00-1250. No Notice of Removal was allegedly filed in the state court matter, and d'Hemecourt contends that his counsel received no notice at that time.
On June 6, 2001, the Schwegmann bankruptcy was converted to a case under Chapter 7 of the United States Bankruptcy Code and Wilbur J. Babin, Jr. was duly confirmed as Chapter 7 trustee. On October 1, 2001, an order was entered by The Honorable Jerry A. Brown approving the appointment of present counsel for Schwegmann as counsel for the Chapter 7 trustee in this matter.
On June 14, 2001, Judge Brown held a pre-trial conference. Counsel for d'Hemecourt was absent and was contacted by phone. Trial dates and a scheduling order were discussed and set. Counsel contends that he:
never received notice of the status conference, let alone notice that the case had been removed prior to the telephone call from the Bankruptcy Court. In fact, thereafter, [counsel] contacted the clerk of Court in Orleans Parish, who indicated that a Notice of Filing Removal was notably absent from the state court record. Therefore, undersigned counsel reviewed the United States District Court's record for the instant case, bearing docket number 00-3647, and discovered that no Notice of Removal, or any supporting documentation, was contained therein. Moreover, Schwegmann also failed to serve undersigned counsel with its Ex Parte Motion to Transfer the instant case from the United State District Court for the Eastern District of Louisiana to the Bankruptcy Court.
Nonetheless, the record indicates that notice of the pre-trial conference was sent to counsel by the Bankruptcy Court on April 25, 2001 to 2222 Canal Street which was the address registered with the Court system.
In addition, a minute entry memorializing the pre-trial conference held on June 14, 2001, was entered and sent to counsel on June 25, 2001. In that minute entry, there is no indication that counsel objected to the jurisdiction of the Bankruptcy Court or that counsel intended to file any pleading seeking a remand. Trial was then set for November 1, 2001.
Counsel for d'Hemecourt then filed a Motion to Set Trial on July 22, 2001, in the state court proceeding, and on August 2, 20001, Judge DiRosa in Civil District Court for the Parish of Orleans set the matter to proceed on October 18, 2001. On August 3, 2001, counsel for Schwegmann received the October 18, 2001 trial date notice.
For three months after counsel for d'Hemecourt had notice, albeit not written, of the removal, counsel filed nothing in federal court to indicate his intention to contest the removal or his objection to trial occurring in federal court. He participated in a pre-trial conference and agreed to a trial date; he filed nothing to indicate his non-agreement with the trial setting for November 1, 2001. Only on September 26, 2001, did counsel file a Motion to Dismiss citing the defects in the removal process.
On October 3, 2001, Schwegmann filed a notice with the Civil District Court to cure the alleged procedural defect. On October 9, 2001, d'Hemecourt filed a Motion to Remand. On October 10, 2001, the Bankruptcy Court denied the Motions to Dismiss and Remand. An interlocutory appeal was sought from this Court and denied. A Motion to Reconsider was filed and submitted when the Bankruptcy Court brought this matter to trial on May 14, 2002. Schwegmann sought judgment for $428,100.66 which included interest and attorneys' fees and $781.78 in costs. A judgment was entered in favor of Schwegmann and against d'Hemecourt. The Bankruptcy Court in addition dismissed d'Hemecourt's reconventional demand.
In essence, d'Hemecourt contends four errors were made by the Bankruptcy Court which were: 1) its failure to remand the case at bar to state court; 2) its finding that the parties did not have a legal contract as between Schwegmann and d'Hemecourt; 3) its finding that d'Hemecourt's debt to Schwegmann was not reduced by the amount owed to d'Hemecourt by Schwegmann for his commissions on the sale of Texaco gasoline; and 4) its denying the admission of Proffer 2 and Proffer 3. The Court will take each up seriatim.
Standard of Review
This Court has jurisdiction over this appeal under § 158 of Title 28 and it:
may affirm, modify or reverse a bankruptcy court's judgment, order or decree or remand with instructions for further proceedings. Findings of fact, whether based on oral or documentary evidence, shall not be set aside unless clearly erroneous, and due regard shall be given to the opportunity of the bankruptcy court to judge the credibility of the witnesses.
Bankr. R. 8013. Thus, the Court reviews the bankruptcy court's conclusion of law de novo, findings of fact for clear error, and mixed questions of law and fact de novo.
Failure to Remand
D'Hemecourt contends that the Bankruptcy Court's failure to either grant the Motion to Dismiss and/or the Motion to Remand was error based on alleged procedural failures. There is a vague allegation found in a footnote that a Notice of Removal was not filed in federal district court (Appellant's Original Brief, p. 76, n. 14), which is totally unfounded as the Court has in its record the Application for Removal stamped filed on December 8, 2003. D'Hemecourt also contends that Schwegmann failed to serve d'Hemecourt with notice as required under 28 U.S.C. § 1446 (d) which is contrary to the certificate of service contained in the Application for Removal. But most importantly, he contends that the alleged failure to file a copy of the notice with the clerk of the state court "timely" required the Court to remand this matter for the procedural defalcation. Reviewing this assignment of error de novo, the Court finds these arguments are without merit.
Section 1446(a) of Title 28 of the United States Code requires a defendant desiring to remove any civil action from a State court to file in the district court of the United States for the district within which such action is pending a notice of removal signed pursuant to Fed.R.Civ.P. 11 and containing a short and plain statement of the grounds for removal, together with a copy of all process, pleadings, and orders served upon such defendant in such action. 28 U.S.C. § 1446 (a). A motion to remand the case on the basis of any defect other than lack of subject matter jurisdiction must be made within 30 days after the filing of the notice of removal under section 1446(a). Id. (emphasis added). Section 1446(d)does require the defendant to promptly give written notice of the removal "to all adverse parties" and requires the defendant to" file a copy of the notice with the clerk of such State court, which shall effect the removal and the State court shall proceed no further unless and until the case is remanded." 28 U.S.C. § 1446 (d). This "requirement" and a failure to comply therewith has had various consequences on the removal process in various jurisdictions; however, under the interpretation provided by the United States Court of Appeals for the Fifth Circuit, failure to meet this requirement is not fatal to the removal process as demonstrated in Dukes v. South Carolina Ins. Co., 770 F.2d 545, 547 (5th Cir. 1985).
In that case, plaintiffs Dukes and Barber sought to collect proceeds of an insurance policy issued by South Carolina Insurance Company ("South Carolina"), which claim was denied by South Carolina. Dukes and Barber filed suit against the insurer in a Mississippi state court. South Carolina filed a removal petition and bond with the United States District Court clerk on November 5, 1982. Like the case at bar, the state court record did not reflect the receipt of a copy of the petition, and South Carolina was unaware of this defect. It answered the petition in federal court and both parties participated in pretrial discovery in the federal forum.
South Carolina, proceeding in the federal forum, served a request for admissions on Dukes and Barber, to which they did not timely respond. South Carolina sought summary judgment, triggering a late response by Dukes and Barber on January 30, 1984 to the request; South Carolina then moved to strike the response as untimely.
On July 20, 1984, Dukes and Barber took a default judgment in the state court without notice to counsel for South Carolina. It was not manifest, from the record, whether Dukes and Barber advised the state court that the case had been removed to federal court and that they had been proceeding before that court for more than one year. The federal court, not having been advised of the state court default, granted South Carolina's motion to strike and motion for summary judgment. Dukes and Barber then informed the federal court and counsel for South Carolina of the state court judgment, and filed a motion to reconsider in the federal court.
Faced with those facts the appellate court found that "[f]ailure to file a copy of the removal petition with the state court clerk is a procedural defect, and does not defeat the federal court's jurisdiction."Dukes v. South Carolina Ins. Co., 770 F.2d 545, 547 (5Z Cir. 1985). Thus, "[a] plaintiff waives the right to object to a failure to file [notice] in the state court if he proceeds with the action in a federal court having knowledge of the procedural defect in the removal." Wright, Miller Cooper, Federal Practice and Procedure § 3726 at 380 (1998) citing Dukes. Indeed, the court found that the state court had constructive notice because of Dukes and Barber's participation in the state court action. "In absence of proof that they failed in their duty as officers of the court to advise the state court of the removal before seeking a default judgment in that forum, we presume that they properly discharged their duty to the state court and advised the court of the removal and of their participation in the conduct of the federal litigation during the previous year. Dukes mandates the affirmation of the Bankruptcy Court's decision to deny a remand to state court.
D'Hemecourt insists that based on Jackson v. City of New Orleans, 1995 WL 599046 (ED. La. Oct. 10, 1995), this court should remand this case. Such reliance is misplaced. In Jackson, plaintiff moved to remand and that motion was unopposed. The court noted on that basis alone, it could grant Jackson's motion. This factor is not present in the case at bar; both motions were vehemently contested. The Jackson court then determined that New Orleans had failed to give Jackson prompt notice and for that reason the case could be remanded. The Jackson court did not discussDukes and in light of the foregoing discussion concerning Fifth Circuit precedent, this Court cannot rely on Jackson for that premise. But most importantly, unlike d'Hemecourt, plaintiff Jackson filed his motion to dismiss and/or remand within the time prescribed by 28 U.S.C. § 1447 (c) and Fed.R.Civ.P. 6(e)-33 days after constructive notice.
In the case at bar, d'Hemecourt failed to object timely to the removal; he did not file anything into the federal record to demonstrate his objection to the removal procedure for three months after he had constructive notice of the removal (pretermitting whether he actually never received a copy of the Notice of Removal) and he had knowledge that there was some alleged defalcation with respect to notice in the state court proceeding. This 90- day inaction constitutes a waiver of his procedural objections.
As noted, procedural objections must be raised within 30 days after the Notice of Removal under 28 U.S.C. § 1446 (a) is filed; section 1446(a) refers to the notice that is filed in federal district court. D'Hemecourt argues the thirty days ran from the time that the Notice of Removal was filed in state court. This contention is simply a misapprehension of the law. Furthermore, even if the 30 days ran from the day that the state court had notice, then this Court must find that the state court had constructive notice, as was found in Dukes, when Motion to Set for Trial was filed in July of 2001. The motion to remand was not forthcoming until October. No error on the part of the Bankruptcy Court occurred in this respect. The Court will now turn to the merits of the appeal.
Failure to Find a Contract
D'Hemecourt contends that the Bankruptcy Court's failure to find a contract between Schwegmann and d'Hemecourt with respect to the Texaco gasline contract is error. As this issue is a mixed question of fact and law, the Court reviews the record de novo. The Court would note at the outset that d'Hemecourt's counsel's failure to abide by many of the strictures of the pre-trial scheduling order including the necessity to exchange documents, may have colored the tenor of the trial. This Court does not countenance such defalcations. Nonetheless it is clear from the testimony that there was an agreement between Mr. Schwegmann and d'Hemecourt such that d'Hemecourt should have received compensation under the Schwegmann-Texaco gasline contract. As such, it must reverse the trial court's findings in this respect.
Article 1027 of the Louisiana Civil Code provides in relevant part:
A contract is formed by consent of the parties established through offer and acceptance.
Unless the law prescribes a certain formality for the intended contract, offer and acceptance may be made orally. in writing. or by action or inaction that under the circumstances is clearly indicative of consent.
La. Civ. Code art. 1927. "This article embodies the notion of 'meeting of the minds' which is required to form a valid contract." Patrick S. Ottinger. Principles of Contractual Interpretation, 60 La. L.Rev. 765, 767 (2000). As noted in this work, "[i]t is not uncommon for parties to enter into a preliminary or interim agreement prior to the execution of a more formal agreement. In these cases, the issue might arise whether the parties are bound prior to the execution of the later agreement or, in some cases, if the later agreement is never executed." Id. at 768.
Indeed, the Louisiana Supreme Court explained in Breaux Brothers Constr. Co. v. Associated Contractors. Inc., 226 La. 720, 77 So.2d 17 (La. 1954):
It is elementary in our law, that where the negotiations contemplate and provided that there shall be a contract in writing, neither party is bound until the writing is perfected and signed. The distinction is manifest between those cases in which there is a complete verbal contract, which the law does not require to be reduced to writing, and a subsequent agreement that it shall be reduced to writing, and those in which, as in this case, it is a part of the bargain that the contract shall be reduced to writing. In the first class of cases the original verbal contract is in no manner impaired by the failure to carry out the subsequent agreement to put it in writing. In the second class of cases, the final consent is suspended; the contract is inchoate, incomplete and it can not be enforced until it is signed by all the parties.Id. at 728, 20. Thus, "an agreement between parties, where their minds have met upon all essentials, constitutes a contract between them and binds them at once although they may have agreed that they would thereafter execute a formal instrument containing the terms of their present agreement." Newport Limited v. Sears. Roebuck Co., 6 F.3d 1058, 1065 (5th Cir. 1993), citing Mermelstein v. Schwab, 64 So.2d 37, 38 (La.Ct.App. 1953) (citations omitted). With this legal framework in mind, the Court finds the Bankruptcy Court was in error to not find a contract between d'Hemecourt and Schwegmann considering the testimony received.
It is uncontroverted that three documents were signed on April 14, 1986. They were (1) the contract for gasoline between Texaco and Schwegmann which d'Hemecourt helped to facilitate; (2) a demand note for $150,000 by d'Hemecourt to Schwegmann; and (3) an outline concerning methods by which the added revenues from the new gasoline contract would be used to offset the loan of $150,000.00 from Schwegmann to d'Hemecourt. The circumstance that these three contracts or documents were executed on the same day demonstrate a connexity. This conclusion is further supported by John Schwegmann's own deposition testimony:
Q. [W]e have three documents signed all on the same day.
A. Okay.
Q. Would that indicate to you some kind of way that there was a relationship between that note and those other documents, the contract and the documents signed by Sam Levy?
A. Yes.
(Defendants' Exhibit 5).
Furthermore, having reviewed the equivocal and less then forthcoming testimony of John Schwegmann concerning the arrangement, it is abundantly clear even through his prevarication that if the margin of profit under the Texaco contract was more than what was made under the Amoco contract, that additional profit margin was to inure to the benefit of d'Hemecourt to the extent of offsetting the loan. (Transcript pp. 76-79, and pp. 144-145). There is insufficient evidence to support any contention that d'Hemecourt was to receive residuals after the note was fully offset by those revenues. On several occasions, Schwegmann testified that there was an arrangement. Indeed Schwegmann testified that there was some arrangement that d'Hemecourt would profit from the Texaco contract providing that certain things materialized. (Transcript, p. 80.) He further agreed that there was no question in his mind that there was an understanding that if the Texaco deal was profitable, d'Hemecourt would be remunerated. (Transcript 80-81). Further proof of Mr. Schwegmann's knowledge and agreement to that arrangement is provided in Defendants' Exhibit 4 where, in Schwegmann's own hand, the differences in revenue as between Texaco and Amoco are outlined. Furthermore, neither did Schwegmann make any request for payment on the note, nor did d'Hemecourt ask for any payment from the gasoline profits; that circumstance indicates that there was an agreement that the additional profits were to offset the amount due under the note.
Levy concurred that if there were profits, d'Hemecourt was to receive remuneration. (Transcript p. 204). From the document Levy penned, which is quoted in its entirety above, Defendants' Exhibit 1, it is also clear that if the profit from the Texaco contract was at least $150,000, d'Hemecourt would owe Schwegmann nothing. If it were not, then, d'Hemecourt was to pay the difference plus interest. If over all profit increased by $456,867.84, d'Hemecourt would pay no interest on the loan. The Court finds Levy's testimony that he was practically forced to initial the document and that the document means nothing incredible. Levy was impeached by his prior deposition testimony in which he averred that he could remember no details of any meeting because there were so many. (Defendants' Exh. D16). Furthermore, Levy testified "he [d'Hemecourt] needed to talk to us and get an arrangement properly put in writing so he can—so he could be—then turn over to the chief financial officer of the accounting department to keep track of what he was talking about. That was never done." As the Court finds the terms of Defendants' Exhibit 1 were agreed to and such a formalization was not noted as necessary in that document, then the failure to commit the agreement into an integrated document is not fatal to d'Hemecourt's claim for remuneration. See Breaux, 226 La. at 728720, 77 So.2d at 20; Newport., 6 F.3d at 1065.
The Bankruptcy Court relied in part on the fact the note had been acknowledged in 1990 to determine that there was no contract. There is conflicting testimony as to the purpose of the acknowledgment; however, its mere fact would not rescind a contract previously confected in 1986. The contract was related to, but separate from, the promissory note. Simply because the note was acknowledged did not alleviate Schwegmann's obligation to use gas profits to offset the debt. At the time of the acknowledgment there had been neither demand for payment nor any accounting in reference to the offset.
To quote the Bard, "What's in a name? That which we call a rose by any other name would smell as sweet." Shakespeare, "Romeo and Juliet", II, ii, 43. Whether characterized as an arrangement, understanding, or contract, the testimony and documents demonstrate there was an agreement that d'Hemecourt be compensated for facilitating the Texaco contract. Merely because Mr. Schwegmann cannot remember the "parameters" of the contract does not render it void, meaningless or non-existent. There is sufficient evidence of what the terms of the contract were weighing all of the testimony as a whole. The Court emphasizes Defendants' Exhibit 1 was formulated on the same day as the note and the Texaco contract. This occurrence is more than mere coincidence, and the Court finds it is more likely than not that the basic terms of Schwegmann's contract with d'Hemecourt were confected. As stated in the legal analysis above, even if a more formal agreement were anticipated, the preliminary verbal and written agreement were sufficient to bind Schwegrnann.
Failure to Reduce Amount Owed to Schwegmann Under the Note by the Moneys Earned Under the Schwegmann-d'Hemecourt Contract.
This issue is also a mixed question of law and fact and subject to de novo review. As the Court addressed this contention fully in the previous analysis and for the reasons stated therein, the Court finds that the Bankruptcy Court committed error in this regard, and remands the case for trial on this issue.
Failure to Admit Proffer 2 and 3
Whether the Bankruptcy Court abused its discretion in its failure to admit Proffers 2 and 3 is subject to an abuse of discretion standard.General Electric Co. v. Joiner, 118 5. ct. 512, 517 (1997); Love v. National Medical Enterprises, 230 F.3d 765, 775 (5th Cir. 200). Furthermore, to the extent that d'Hemecourt is appealing the decision of the Bankruptcy Court to strike plaintiff's reconventional demand, the standard of review is de novo as it is an issue of law.
The reconventional demand contains allegations that focus on d'Hemecourt's right to recover compensation for efforts made prior to April 14, 1986, reference gasoline rights; (2) monies due under a contract entered into on April 14, 1986, which claim an offset to a note as well as any residuals occurring after payoff of the note; and (3) compensation for hundreds of additional hours of consulting services reference gasoline outlets and "food supermarket outlets."
This Court has reviewed in detail the transcript of the proceedings before the Bankruptcy Court. The Bankruptcy Court struck the reconventional demand with respect to all claims "except as to Texaco." (Transcript, May 15, 2002, p. 49). This deletion was apparently aimed at the so called "Checkers" claim which plaintiff contended was enmeshed in the reconventional demand. (See Answer and Reconventional Demand, ¶ IV.) Although silent with respect to its particular reasons, this Court finds no error in the Bankruptcy Court's dismissal of the Checkers claim. Even under notice pleading, the allegations in the Reconventional Demand are neither sufficient to raise this issue for trial, nor has the Court been made aware of any other pleading, properly filed, that specifically raised this issue in a timely manner for trial.
The Court does not find error in either the dismissal of the reconventional demand insofar as it seeks remuneration over and above the offset to the note for the reasons stated above. There is simply insufficient evidence of any contract between Schwegmann and d'Hemecourt with regard to payment to d'Hemecourt for any other consulting services provided to Schwegmann by d'Hemecourt even if Proffers 2 and 3 had been admitted. (See p. 13 above). Accordingly,
IT IS ORDERED that the opinion of the Bankruptcy Court is AFFIRMED in part and REVERSED in part. The Bankruptcy Court's judgment is affirmed with respect to the denial of the Motion to Dismiss and the Motion to Remand, and as to the dismissal of plaintiffs reconventional demand except as to the d'Hemecourt claim for offset of the amount due under the demand note as contemplated by the terms of Defendants' Exhibit 1.
IT IS FURTHER ORDERED that the judgment of the Bankruptcy Court in favor of Schwegmann Giant Supermarkets and against Robert J. d'Hemecourt and Margaret Grenier d'Hemecourt is REVERSED and REMANDED with instructions that Schwegmann's shall produce all evidence necessary for the Bankruptcy Court to determine whether any moneys are still due and owing under the Demand Note considering the provisions of the Schwegmann-d'Hemecourt contract for remuneration for the Texaco contract