Category: Uncategorized

Real Estate Liability: Recovery Denied in “As Is” Sale Despite Quick Discovery of Mold

05.31.2019

In the recent case of Riedel v. Fenasci, 2018-0540 (La. App. 1 Cir. 12/28/18), _______ So. 3d _______, 2018 WL 6818716, home buyers sued the sellers and the involved real estate agents after mold was discovered shortly following the sale. This is a common fact pattern in humid South Louisiana. The buyers lost in the trial court when there was no evidence that the sellers or the agents knew of the problem. The result was affirmed by the First Circuit Court of Appeal.

The Riedels identified mold weeks after the closing and filed a claim with their homeowner’s insurer. But the claim was denied when the insurer’s inspection revealed long- term damage, rot, and deterioration in a ceiling due to water damage. That finding prompted the suit.

Against the sellers, the Riedels contended that they “had to have known” about the moisture and mold in the home prior to the sale. Because the home was sold “as is,” they had to establish fraud to recover. However, the sellers had not lived in the home for years and had received no complaints from tenants over this time. Under such facts, the claim of fraud was not supported.

The Riedels also sued both agents for negligent misrepresentation, and their own agent for breach of fiduciary duty. In assessing the claim against the agents, the Riedel Court agreed that real estate agents are liable for negligent misrepresentation when they fail to disclose hidden defects in the property which were known or should have been known to them. The Court also agreed that a purchaser’s real estate agent owes a fiduciary duty, the highest duty of care recognized by law. Nevertheless, when the plaintiffs’ own inspector found no visible evidence of mold prior to the sale and there was no indication that the agents possessed prior knowledge of the mold, the claim against the agents was also dismissed.

Marty Golden has been practicing law based in Baton Rouge, Louisiana for over thirty years, concentrating in civil litigation primarily involving injuries, property damage, insurance coverage, and contract disputes. Much of his practice is defending and advising real estate agents in suits by property buyers and sellers, but Marty also defends other professionals, insurance companies, manufacturers, and business owners. Marty has a special interest in all things procedural, because they are the rules of the road for litigators and knowing them better than his opponent gives him a leg up in court.

Louisiana Supreme Court issued a significant ruling in a class action case involving tax credits for solar panels

05.10.2019

Recently, the Louisiana Supreme Court issued a significant ruling in a class action case handled by Keogh Cox partners Chris Jones and Nancy Gilbert. The case involved tax credits for solar panels. The Court’s ruling overturned a lower court decision that held an Act of the Legislature unconstitutional. After the plaintiffs’ Application for Rehearing was denied, the Court’s decision is now final.

In Ulrich, et al. v. Kimberly Robinson, Secretary of the Louisiana Department of Revenue, 2018-0534 (La. 3/26/19), 2019 WL 1395316, the class action plaintiffs were persons who purchased and installed residential solar panel systems in their homes. When they claimed the solar electric system tax credits on their 2015 state tax returns pursuant to La. R.S. 47:6030, the tax credits were denied by the Louisiana Department of Revenue, based on Act 131 of the 2015 legislative session. Act 131 capped the maximum amount of solar panel tax credits to be granted by the Department of Revenue, and the plaintiffs’ claims were made after the cap was exhausted.

When their claims for the tax credits were denied, plaintiffs filed a declaratory judgment action seeking to declare Act 131 unconstitutional. During the pendency of the suit in the district court, the Louisiana Legislature enacted Act 413 which provided additional funding for solar tax credits. Under Act 131, all taxpayers whose solar panel tax credit claims were previously denied would receive the entirety of their tax credits over installments. The district court declared Act 131 unconstitutional and concluded that Act 413 did not moot the controversy.

Because the district court declared Act 131 unconstitutional, the Department directly appealed the decision to the Louisiana Supreme Court. Oral arguments occurred in October of 2018. In the Court’s recent opinion, it concluded that Act 413 mooted the controversy. According to the Court, the plaintiffs no longer maintained a “justiciable controversy” because Act 413 provided for the payment of the entirety of the previously denied tax credits. Accordingly, the Court overruled the district court’s judgment that declared Act 131 unconstitutional. Plaintiffs filed an Application for Rehearing and that request was recently denied, making this decision final.

Chris Jones is a partner with Keogh Cox in Baton Rouge, LA. He focuses his practice on class actions and mass torts, and handles these matters in courts throughout the country. He is a life-long resident of Baton Rouge, where he lives with his wife and four children.

When the Phone Rings: Responding to the Workplace Accident

02.25.2016

“Having a response plan in place before an accident is important. It can improve safety, save time, reduce distraction, and limit exposure.”

It will happen, maybe today, maybe tomorrow, maybe six years from now; but if you are an employer of any size, the call will come, and the co-worker, passerby, or caller- in a panicked voice- will inform you that there’s been an accident. You cannot control what has just happened. You can control what you do about it.

Supreme Court Emphasizes “Error-Correcting” as Proper Role of Appellate Courts

01.21.2016

In a 68 page decision, the Louisiana Supreme Court in Hayes Fund for the First United Methodist Church of Welsh, LLC, et al. v. Kerr-McGee Rocky Mountain LLC, et al. forcefully explained the role of an appellate court. It is axiomatic that Louisiana appellate courts are courts of review. Louisiana law specifically sets the standard of review an appellate court must apply when reviewing a trial court’s factual decisions (manifest error) or its legal decisions (de novo). According to Hayes Fund, a failure to faithfully apply the “manifest error” standard of review where applicable causes an appellate court to function as a “choice-making court” when its proper role is to serve as an “errors-correcting court.”