Articles Posted in Real Estate

landcape-1394201-1024x768Desiring to be friendly, you may allow your neighbors to use a portion of your land in order to make their lives a little easier.  You allow your neighbors to continue to use your land for some time, but now you want privacy on your property.  At this point you would most likely ask your neighbor to stop using your land, but what do you do when they refuse?  What do you do when your new neighbor claims ownership of the portion of land that you allowed them to use?  Defending ownership rights against presumptuous neighbors was a recent issue in a case out of St. Landry Parish.  

In 1989, Emery and Hazel Scrantz divorced.  Prior to Mr. and Mrs. Scrantz’s divorce, they owned a single 119-acre tract of land.  After the divorce, a court ordered the land be separated into three separate tracts.  Emery received two tracts, a 20-acre tract, and an 80-acre tract.  Hazel received one 19-acre tract.  Hazel’s 19-acre tract was situated in-between both of Emery’s tracts of land.  In order to allow Emery access to both of his tracts, he was granted a servitude (i.e. easement) to run his cattle across Hazel’s land.  On July 7, 1993, Emery sold his 80-acre tract to his brother, the Plaintiff, Joseph Scrantz.  Emery maintained ownership of his 20-acre tract.   Emery and Joseph shared their land to raise cattle, and would often use the passage crossing over Hazel’s land to transfer the cattle between the two tracts.

In 1994, Hazel sold her 19-acre tract to the Defendants, Marvin and Dorothy Smith.  When the Smiths first purchased the tract of land from Hazel they were unaware of the servitude.   In 2013 Emery died, and his daughter, Tina Scrantz, inherited the 20-acre tract of land. At some point before his death, Emery and Marvin Smith had a disagreement concerning the use of the passage.  The disagreement was settled when Marvin agreed to let Emery’s cattle pass through his tract to access the land owned by the Scrantz brothers.  Marvin Smith also allowed Joseph and Emery to build a fence around the servitude. After Emery’s death, Joseph continued running cattle across the passage to the 20-acre tract now owned by Tina.

demolition-1575129-1024x666Imagine that you own several rental properties, and one day some of the properties get severely damaged by a hurricane. You slowly try to repair the damaged properties, but your local government decides to demolish it, without notifying you first. That is what happened to a St. Bernard Parish, Louisiana man named Glenn Sandrock.

Mr. Sandrock owned approximately forty rental properties in St. Bernard Parish. One of those properties was demolished by St. Bernard Parish Government (“SBPG”). Many properties within the Parish were damaged by Hurricane Katrina. In an effort to rebuild and restore the Parish, the St. Bernard Parish Council passed multiple ordinances which made it mandatory for owners to repair their hurricane-damaged properties. Ordinance #634-12-05 basically allowed SBPG to access private property to clean debris or even to demolish the property if the property didn’t meet reconstruction/maintenance specifications established by SBPG.

Mr. Sandrock received a condemnation notice during December 2006 which declared his property as a public health and safety hazard. The notice also stated that his property was scheduled for demolition. Mr. Sandrock applied for and was granted a demolition appeal in January 2007 which allowed Mr. Sandrock seven days to clean and properly secure the property. Ten days after Mr. Sandrock was given the appeal, SBPG sent an employee to the property to inspect, but without notifying Mr. Sandrock. The SPBG employee inspected the property and found that the property was not up to the standards required by the demolition appeal. Because Mr. Sandrock’s property was still covered with debris and had not been properly secured, SBPG revoked the appeal but did not notify Mr. Sandrock of the revocation.

forest-2-1550924-1-1024x768Imagine you owned acres of lush and valuable trees. Then imagine that one day, you discover your land to be completely barren, the valuable trees almost completely removed.  Even worse, you have no real, viable recourse against the thieves who cut down and hauled off the trees because of a very strict, literal, narrow interpretation of the terms of a statute.  Instead, you are left with stripped land and a possibly uncollectable judgment.  

This is what happened to the Lowman Family in DeSoto Parish.  The Lowmans, in this case, are comprised of a sibling group who owned about twenty acres of land once populated by timber bearing trees.  Upon discovering the trees missing, the Lowmans filed a lawsuit against six defendants composed of two groups: three individuals and three companies.  The individuals, Ricky Whitaker (“Ricky”), Michael Whitaker(“Michael”) and Jerry Whitaker (“Jerry”), are siblings.  The companies, Jerry Whitaker Timber Contractors, L.L.C. (“JWTC”), Evergreen Timber

Corporation (“Evergreen”) and Brady Timber Corporation (“Brady”), were allegedly directing the actions of the Whitaker siblings in an employer type manner which, if true, would render the company defendants vicariously liable for the Whitakers’ actions.  

tax-1501475-1024x768In Louisiana, a failure to pay your property taxes can result in your property being subject to a tax sale. This can cause a tremendous headache. Though the Louisiana Constitution and Revised Statutes provide that the government’s right to proceed to a tax sale expires three years after the last day of the year in which the taxes were due, one New Orleans property owner was sent a tax bill including unpaid taxes which seemingly should have been expired.

In 2006, Kathleen Bilbe purchased a piece of real estate located at 1722 Lark Street in New Orleans. The property was subject to ad velorem taxes. Ms. Bilbe failed to pay her property taxes in 2007, which accumulated interest, penalties, and costs. The New Orleans Department of Finance sent Ms. Bilbe a tax bill for 2007 reflecting the real estate taxes she owed for 2010, neighborhood fees for 2010, and the unpaid taxes from 2007. Ms. Bilbe made a partial payment towards the unpaid 2007 taxes in February 2010 but the entire balance of the 2010 bill remained.

The Department of Finance sent a notice to Ms. Bilbe that her property could be subject to a tax sale due to her unpaid taxes in July of 2011. That same month she paid the entire balance and her property was spared from the tax sale. Though the Louisiana Revised Statutes allow an opportunity to dispute the amount assessed by the tax collector, Ms. Bilbe did not indicate that she was making the payment in protest. La. R.S. 47:2314.

shopping-center-1507250-1024x768Even if a property is zoned for commercial purposes, a city may discretionarily deny a business from buying and developing that property if the city determines it is against the public interest. The city of Shreveport, Louisiana was challenged when they denied a Dollar General’s site plan to develop a commercially zoned, “use by right” 1.13-acre lot. While Dollar General’s developer, GBT Realty Corporation, petitioned the trial and appellate courts for damages resulting from loss of a business opportunity, the courts ruled that the city was immune from tort liability when a city exercises its discretion in the use of its commercially zoned properties.

In May 2012, GBT appeared before the Shreveport Metropolitan Planning Commission (MPC) at a public hearing to develop a Dollar General store. The MPC expressed concerns relating to the proximity of a Family Dollar store across the street from the proposed Dollar General site as well as concerns about the appearance and landscaping of the proposed Dollar General store. A month later, GBT presented an updated plan with changes made to the store’s landscaping and facade at an MPC public hearing. Nonetheless, amid concerns by the public as well as the MPC, the board unanimously vetoed Dollar General’s plan citing that the plan did not comply with proposed zoning changes for the city’s “2020 Master Plan” and that the site in question was too small to accommodate Dollar General’s store plan. In response, GBT filed an action before the First Judicial District Court to approve the first site plan. The District Court approved the plan and reversed the MPC’S decision. In April 2013, GBT filed a lawsuit against the MPC and city of Shreveport alleging a tort claim for loss of business opportunity due to the delay in approval has caused the plan to fall apart.

The trial court concluded that the city was protected from liability from exercising its discretion in disapproving the site plan. Louisiana statute protects public bodies, including cities and its officers, when they perform discretionary acts that are within the scope of their governmental responsibilities.  La. R.S. 9:2798.1. The trial court recognized that the city exercised its discretion in denying the Dollar General site plan based on issues of impact to the nearby property, traffic, and other public safety concerns. The trial court also concluded that the plan fell apart because of disagreements between GBT and Dollar General rather than falling apart due to the delay caused by the MPC denial and the district court’s approval. Accordingly, the trial court ruled in favor of the city of Shreveport.

termite-formation-1358063-1024x768Buying or selling a home is a complicated process filled with legal and practical pitfalls that can cause problems for both the buyer and seller.  One of the most important steps that a person engaged in a transaction with potential legal issues must take is to speak with a good lawyer who can navigate the process and make sure their rights and interests are protected to the fullest extent possible.  A good lawyer can also make sure that the buyer or seller understands all the implications of contractual language.  In a home sale, every word in the agreement is important and can alter the rights of everyone involved in the transaction.  One or two seemingly insignificant words can entirely change the rights and protections that a party may normally receive under the law.  The Prejeans found out the hard way. In their case, a combination of a few termites, some water, and the two little words “as is,” led to a massive headache and loss of money when they purchased a home in Houma, Louisiana.

The Prejeans entered into a purchase agreement to buy the house in Houma from John Monteiro. John’s wife acted as the realtor.  Prior to closing the sale, the Monteiros disclosed that the house had previously been infested with termites. The Prejeans had Terminex inspect the house.  Termites were found living in the house and a later home inspection found defects in the house such as a wet spot on the wall in the kitchen and standing water in the same location, among other issues.  The report prompted the Prejeans to request that Mr. Monteiro make repairs, treat the home for termites, and acquire a termite treatment plan from Terminex.  The Prejeans retained a right to inspect the house, including opening up the walls to ensure that termites and moisture were not present, before closing the sale, but chose not to exercise those rights.  Instead, the Prejeans executed an Act of Cash Sale, providing that the sale was “as is” and waiving all warranties on the property.

Following the completion of the sale, the Prejeans began renovating the home but had to halt the renovations when they found that there was extensive termite damage and infestation combined with water damage.  The Prejeans filed a lawsuit against the Monteiro estate and against Ms. Monteiro as the acting realtor. Mr. Monteiro passed away before the lawsuit was filed.

residence-1226143-768x1024In joint real estate ventures, all partners are presumed to be equal unless agreed otherwise. All parties should have equal decision-making power, share equally in gains and losses, and possess equal interests in the subject property. Cooperation among the partners is essential to the success of the venture. Each person must enter into the transaction with an open mind towards other partner’s ideas and business tactics. However, when one person uses the other partners for his own personal gain, litigation usually follows. This was the unfortunate situation in the following case.

The defendant, Mr. Paul Barranco, wanted to purchase three apartment complexes in Baton Rouge, LA as investment properties. After failing to obtain financing on his own, he enlisted the help of Plaintiffs, Mr. Brignac and Mr. Godchaux. The three parties formed God-Brig-Bar, LLC. Plaintiffs sent their tax information to Mr. Barranco for the purposes of obtaining financing. Mr. Barranco advised Plaintiffs that he was selling another apartment complex located on Ned Drive in Baton Rouge and that the proceeds from that sale may be used as a down-payment on the three apartment complexes. Each Plaintiff gave a check to Mr. Barranco for their one-third deposit amount on the three complexes in the amount of $10,000.00 each.

Mr. Barranco deposited the funds and advised Plaintiffs that Palisades Properties expressed interest in acquiring the purchase agreements to the three properties. The sale of the three complexes to Palisades Properties would yield $1,132,000.00 in profits to be split three ways. Mr. Barranco drafted and signed a letter of intent in his name only to Palisades Properties, stating that he would sell it the three purchase agreements, one for each complex. Plaintiffs advised Mr. Barranco that they wanted the letter of intent changed to include all of their names. Mr. Barranco refused to do so and asserted that it might scare off the potential buyer since they were already nervous about such a large investment.

lake-reserve-1634943-1024x768Normally, people pay extra for waterfront property but prefer for their yard to be on a lake front, have an ocean view, or even have a pond on the property. Most would not consider having a home built on an improperly graded yard that fills up with water every time it rains a desirable body of water to have on the property. This is exactly what happened to Debbie Shepard in May of 2009 when her backyard had a hole in it that was promised to be fixed before the closing of the house. Luckily for her, she was entitled to remedies under the Louisiana New Home Warranty Act (“NWHA”).

Debbie Shepard purchased a lot with a newly constructed home on it built by Robinson Construction. Before closing on the property, Shepard noticed that water was pooling up in the backyard every time that it rained, and notified Robinson Construction. Robinson said that it would be fixed before the finalization of the sale of the property. The problem was still not fixed by the time of closing and wasn’t addressed until months after Shepard had moved into the home. Robinson installed three pipes in the back yard that were meant to alleviate and reroute the water from the backyard but instead made the pooling problem much worse. Robinson then refused to fix the problem, which led to Shepard filing the lawsuit against the company.

Robinson argued that under La. R.S. 9:3144, the warranty did not include any damage that was caused or worsened by a change in grading of the ground made by anyone other than the builder or their agents, It also argued that the damage was not a result of poor construction by the builder.

house-1-1225482-1024x767Below is a case of a home sale in St. Bernard Parish that didn’t go all too well. In this case, communications between the parties to the sale were delayed and the sale never went through. The case highlights the need to be diligent when buying or selling real estate and the necessity of having a good real estate lawyer.

The sellers, David and Gwendolyn Hopkins, placed a home for sale in Arabi, Louisiana. Juanita Coco, an interested buyer, contracted with a representative of Prudential Realtors in order to buy that same home. Both the Hopkins and Ms. Coco signed an Act of Sale agreement that was contingent upon Ms. Coco being able to obtain financing in the amount of $152,200. The Act of Sale, by agreement, was supposed to be completed by a deadline of April 4, 2008, with the option to extend the deadline.

Ms. Coco hired an appraiser to determine the value of the home. The appraiser told Ms. Coco that because the house was located in an area that was previously affected by Hurricane Katrina, the appraiser had to list the home at a value that was considerably less than the asking price. The original asking price of the home was $152,500 and the appraisal price was $147,000.  Since it was appraised below the asking price, Ms. Coco’s lender, Countrywide Bank, stated that it would not approve Ms. Coco’s home loan if the asking price was not reduced. The Hopkins signed an amendment to the original Act of Sale to have the original price reduced to the appraisal price. They faxed it to Dane Ruffins, a Prudential representative, after business hours on April 3, 2008. Ms. Ruffins did not receive the amendment until the morning of April 4, 2008. The same day that, Ms. Ruffins also received a letter from Countrywide Bank stating that the loan would not be approved.

house-i-1491881-1024x768Sometimes even the best-planned of deals amongst parties may fall through. Parties often turn to the courts to resolve contractual disputes. When a court is interpreting a contract between two parties, it is often as simple as applying the “four corners” rule. I.e. it will not look at anything outside the four corners of the contract. This particular method of interpretation is useful (and under Louisiana law mandatory) where a contract is written clearly and is not ambiguous. In a recent case, the Louisiana Fourth Circuit Court of Appeal upheld this method of interpretation when faced with a contract dispute out of Orleans Parish.

In 1999, Mr. and Mrs. Tubbs made an offer to purchase a house from Mr. and Mrs. Schafer. The Schafers accepted this offer, creating a contract to sell the house. As part of the deal, the Tubbses made a deposit of about $53,000 via a promissory note. Among the terms of this contract was a provision that would cancel the contract should the Tubbses be unable to obtain sufficient financing for the purchase price. If this happened, then the Schafers would have to return the promissory note deposit the Tubbses had paid as part of the arrangement. The Tubbses were unable to get the necessary funding so they did not show up to the closing.

The Schafers sued to collect the note as damages stipulated in the contract. In response, the Tubbses responded that the contract should be considered null and void since they were unable to obtain financing because the financing contract itself required that their home is sold by a specified time. The Tubbses attempted to sell their former home to a family suggested by the Schafers. When the deal fell through due to the bankruptcy of the would-be buyer, they were unable to keep the 7% interest rate they had been promised.