As sons of an owner of a successful recreational vehicle business, Alan and Jeff Kite worked in the family business of Kite Brothers. The relationship went sour between father and son. The children gave themselves raises and later left — taking some business records with them. But, Alan Kite’s claims, such as defamation, retaliatory discharge, and detrimental reliance, against Kite Brothers didn’t hold up at trial court or the court of appeal. In Kite v. Kite Bros., No. 11-334 c/w 11-335 (La. Ct. App. 3 Cir. 10/5/11) the court of appeal affirmed the 36th Judicial District Court, Beauregard Parish after it determined that the trial court had rendered a final judgment on those claims.
Family businesses create unique disputes of a personal nature. Robert Kite co-founded the dealership with his brother in 1961. It began as a corporation but was changed to a limited liability company in 1998. During the 1980s, Robert Kite hired his sons Alan and Jeff. Although he never signed an employment contract, Alan had broad powers in the business to write checks on the company account. The father believed that he was being generous to son Alan, who earned more than $200,000 a year. But, the father set the salaries. Hurricane Rita in September 2005 provided a diversion for the sons to decide, on their own, to raise their salaries. Alan agreed with his brother to take more than triple his previous weekly salary, which had been set at $1,500 a week. They also agreed to take a 10% cut of all revenues. They agreed that this arrangement would end when “everything settled down after the storm.”
They didn’t stop. The father noticed the increased unauthorized compensation to Jeff in January 2006. He demanded that Jeff return his salary to its authorized level. The father also revoked both sons’ authority to write checks and canceled their credit cards. Alan continued to give himself a weekly salary of $5,000 instead of $1,500. Later that month, the sons left the business. Father and sons disagree whether Alan and Jeff quit or were fired. Alan took with him, also without permission, business papers owned by the business. The father sought them back by filing a criminal complaint. Alan assured an investigating police officer that he would return the records, but he never did. Alan’s lawyer later returned some of them.
The father still wanted to make things right and keep the family together. He couldn’t verify Alan’s rightful final compensation because Alan took some of those records. The father just “wrote Alan a check for $100,000, minus employment taxes.” The sons still sued their father and the business, and the father and business counterclaimed (“reconventional demands”) for the unauthorized salaries and raises. The father tried to resolve the dispute through mediation. The parties came to an agreement, but Alan and Jeff failed to abide by it. The trial court combined with the sons’ claims the father’s claim to declare the mediation null. The sons started a competing RV dealership, but Alan and Jeff argued about control of their company. Jeff reconciled with his father and dismissed the claims he had against his father.
The father moved the trial court to dismiss Alan’s claims. The motion for summary judgment had numerous affidavits and depositions to support dismissal. Although Alan argued that the parties disputed various facts, preventing dismissal, Alan never gave the court what it wanted: specific statements in dispute. The court dismissed several of Alan’s claims, but not all. The dismissed claims included defamation, retaliatory discharge, and detrimental reliance.
For an issue to be accepted by the court of appeal, the trial court must be done with it. The trial court shows this by issuing a valid, final judgment. That issue was unclear. The trial court dismissed only some of Alan’s claims; others could be tried. The court did not explain why it considered its judgment on some of the claims to be final. It only said “there is no just reason for delay.” But, that’s just some words cribbed from the Louisiana Code of Civil Procedure. Without a valid, final judgment, the court of appeal had no authority to hear the case. The trial court should have been explicit, but when a court is not, the court of appeal can decide for itself. Four factors are decisive. What is the relationship between the claims decided by the trial court and those that were not? Could the trial court’s deciding of other matters make review unnecessary? Might the reviewing court, if it decides to review the issue now, have to consider the issue again? Do various other factors, such as delay, economics and solvency, shortening the time of trial, the frivolous nature of the other claims, expense, and similar concerns preclude review?
For the appeal of the partial summary judgment, dismissing only some of Alan’s claims, the court of appeal felt safe in hearing the appeal. The claims were individual. They didn’t relate to the claims that the trial court had not decided. It would be unlikely that the court of appeal would face the same issues again from another appeal from the case. The court accepted review of the trial court’s dismissals.
The results of the claims on appeal will be described in a subsequent blog.
Sometimes, the reasons for seeking just recovery are many and complicated. In such cases, some of those claims may be solved individually. A lawyer can make sure that the trial court made a valid, final judgment that resolves the matter or allows an appeal.
If you have been harmed by the acts of another, call the Berniard Law Firm toll free at 1-866-574-8005 and speak with a lawyer who can help you get the recovery you deserve.