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ASSOCIATED ACQUISTIONS,                                                    *                 NO. 2007-CA-0120
L.L.C.
*                                                                          COURT OF APPEAL
VERSUS
*                                                                          FOURTH CIRCUIT
CARBONE PROPERTIES OF
AUDUBON, L.L.C., CARBONE                                                   *                 STATE OF LOUISIANA
HOTEL PROPERTIES, L.L.C.,
R.P. CARBONE                                                               *
CONSTRUCTION COMPANY
D/B/A R. P. CARBONE
COMPANY, ROSS P.
CARBONE AND VINCENT P.
CARBONE
APPEAL FROM
CIVIL DISTRICT COURT, ORLEANS PARISH
NO. 2006-2160, DIVISION “G-11”
Honorable Robin M. Giarrusso, Judge
Charles R. Jones
Judge
(Court composed of Judge Charles R. Jones, Judge Dennis R. Bagneris Sr.,
and Judge Edwin A. Lombard)
J. Konrad Jackson
Robert G. Jackson
Daniel W. Dilzell
JACKSON & JACKSON, PLLC
825 Baronne Street
New Orleans, LA   701131102
COUNSEL FOR PLAINTIFF/APPELLEE
Mark G. Duncan
Stephen I. Dwyer
DWYER & CAMBRE




3421 North Causeway Boulevard, Suite 601
Metairie, LA   70002
COUNSEL FOR DEFENDANTS/APPELLANTS
AFFIRMED
Defendant-Appellant, Carbone Properties of Audubon appeals an
adverse judgment relating to its motion for summary judgment and
exception of no cause of action.  We affirm.
On or about December 22, 2004, the Petitioner-Appellee, Associated
Acquisitions, L.L.C. (hereinafter, “AA”) entered into a Sale Agreement
(hereinafter, the “Sale”), in which it contracted to sell its eleven percent
(11%) membership interest in Defendant-Appellant Carbone Properties of
Audubon, L.L.C. (hereinafter, “CPOA”). CPOA is the owner of the historic
“Audubon Building” at 931 Canal Street in New Orleans. During the time of
the Sale, the property owned by CPOA was being developed into a Hilton
Hotel.
Pursuant to the Sale, AA sold its eleven percent (11%) membership
interest to the Appellant, Carbone Hotel Properties, L.L.C., (hereinafter,
“CHP”) and CPOA. The sale price for the membership interest was a
twenty-five thousand dollar ($25,000) non-refundable down payment, one
secured purchase note to AA in the amount of one million dollars




($1,000,000), another secured purchase note to AA in the amount of one
million five hundred thousand dollars ($1,500,000) and interest in the future
contingent upon certain events.
The second secured purchase note provides that upon the occurrence
of any default thereunder, the “lender has the right to prospectively adjust
and fix the simple interest rate under [the] note until [the] note is paid in full,
at the rate of sixteen percent (16%) per annum.” The note also provides that
in the event the lender refers the note to an attorney for collection, or files
suit against the borrower to collect, the borrower agrees to pay reasonable
attorneys’ fees incurred by the lender. The note was secured by the pledge of
the membership interest that was the subject of the Sale, the personal
guaranty of the Appellants, and the first position assignment and lien on any
and all payments, fees, and/or distributions to CHP, or its affiliates.
On December 30, 2004, CPOA obtained a construction loan from
Marshall Investments Corporation (hereinafter, “Marshall”) for over twenty-
six ($26) million dollars to build the hotel. When the loan closed, CPOA
paid the first note in full. Construction and demolition began, but revealed a
number of unforeseen conditions, which required additional funding, not
considered during the calculation of the original budget. CPOA requested
additional financing from Marshall; however, unresolved issues resulted




from these transactions. The disagreements between CPOA and Marshall
began prior to Hurricane Katrina. As
CPOA and Marshall attempted to resolve the issues the hurricane struck
New Orleans on August 29, 2005. CPOA claims that the storm drastically
affected its construction, and thus should be cause for dissolution of its
agreement with AA.
On January 18, 2006, AA notified CPH of the interest payment, in the
amount of $35,215.15, due on February 20, 2006. CPH did not respond, nor
did they make any payment toward the note, and on February 22, 2006, AA
sent CPH a notice of default. Thereafter, AA instituted the foregoing action.
On September 15, 2006, the trial court granted AA’s Motion for
Summary Judgment and Exception of No Cause of Action, rendering
judgment in favor of AA in the sum of $1,546,422.40 pursuant to the Second
Note, with interest thereon. Additionally, the court granted a declaratory
judgment in favor of AA, in which the court stated that the provisions of
Section 2.4 of the Sale are legally enforceable terms of the agreement that
the Defendant-Appellants must comply with. The district court also
recognized AA’s security of the performance of the obligations as being the
valid pledge and assignment of the 11% membership interest and the in
solido personal guaranty of R.P. Carbone Construction, Ross Carbone and




Vincent Carbone as being fully enforceable in accordance with the terms
thereof.    No reasons for judgment were provided.
CPOA asserts that the trial court erred in holding that there was no
genuine issue of fact to be determined at trial regarding (1) the intent and
purpose of the Sale and corresponding promissory notes as they were
connected to the hotel
construction project, (2) the unlawful actions of CPOA’s construction lender
following the storm which effectively ended the hotel project, and (3) the
manner in which these events rendered performance of the sale and notes
impossible, and thus erred in granting the Motion for Summary Judgment
and sustaining the Exception of No Cause of Action.
DISCUSSION
Appellate courts use the same standard of review applied by the trial
courts, de novo, to determine whether the summary judgment is appropriate.
Williams v. Metro Home Health Care Agency, Inc., 02-0534, p. 2 (La. App.
4 Cir. 5/8/02), 817 So.2d 1224, 1226, (citing Independent Fire Ins. Co. v.
Sunbeam Corp., 99-2181, c/w 99-2257, (La. 2/29/00), 755 So.2d 226, 230).
The supporting documentation submitted by the parties should be scrutinized
equally, and there is no longer any overriding presumption in favor of trial
on the merits. Schully v. Hughes, 00-2605, p. 2 (La. App. 4 Cir. 6/5/02), 820




So.2d 1219, 1220   (citing Independent Fire Ins. Co. v. Sunbeam Corp., 99-
2181, c/w 99-2257, (La. 2/29/00), 755 So.2d 226, 231). Additionally, the
summary judgment procedure is designed to secure the just, speedy, and
inexpensive determination of actions. Two Feathers Enterprises v. First
National Bank, 98-0465, p. 3   (La. App. 4 Cir. 10/14/98), 720 So.2d 398,
400. This procedure is favored and shall be construed to accomplish these
ends. La.C.C.P. art. 966(A)(2).
Louisiana Code of Civil Procedure article 966(B) provides that a
summary judgment shall be rendered forthwith if the pleadings, depositions,
answers to interrogatories, and admissions on file, together with the
affidavits, if any, show that there is no genuine issue as to a material fact,
and that the mover is entitled to judgment as a matter of law. However, if the
movant will not bear the burden of proof at trial on the matter that is before
the court, the movant’s burden does not require him to negate all essential
elements of the adverse party’s claim. Rather, he need only point out that
there is an absence of factual support for one or more elements essential to
the adverse party’s claim. La. C.C.P. art. 966(C)(2).
Pursuant to La. C.C.P art. 966, the initial burden of proof remains on
the mover to show that no genuine issue of material fact exists. After the
mover has met its initial burden of proof, the burden then shifts to the non-




moving party to produce factual support sufficient to establish that he will be
able to satisfy his evidentiary burden at trial. La. C.C.P. art. 966(C)(2). If the
non-moving party fails to meet this burden, there is no genuine issue of
material fact, and the mover is entitled to summary judgment. La. C.C.P. art.
966; Schwartz v. Administrators of Tulane Educational Fund, 97-0222 (La.
App. 4 Cir. 9/10/97), 699 So.2d 895, 897. When a motion for summary
judgment is properly supported, the non-moving party may not rest on the
mere allegations or denials of his pleadings, but his response, by affidavits
or as otherwise provided by law, must set forth specific facts showing that
there is a genuine issue of material fact for trial. La. C.C.P. art. 967; Townley
v. City of Iowa, 97-493 (La. App. 3 Cir. 10/29/97), 702 So.2d 323, 326.
CPOA asserts that the intent and purpose of the Sale lends its way to a
genuine issue of material fact, and thus the district court should have denied
AA’s Motion for Summary Judgment. Contracts have the effect of law for
the parties and may only be dissolved through the consent of the parties
involved or on grounds provided by law. La. Civ. Code art. 1983. When
discerning the intent of the parties,                                                “[t]he interpretation of a contract is the
determination of the common intent of the parties with courts giving the
contractual words their generally prevailing meaning.”  SWAT 24 Shreveport
Bossier, Inc. v. Bond, 00-1695, p. 20 (La. 6/29/01), 808 So.2d 294, 307,




citing La. C.C. arts. 2045, 2047; see e.g. Amend v. McCabe, 95-0316, p. 7-8
(La. 12/1/95), 664 So.2d 1183, 1187.    Louisiana Civ. Code art. 2046, states
that, “when the words of a contract are clear and explicit and lead to no
absurd consequences, no further interpretation may be made in search of the
parties’ intent.”  Additionally, “[e]ach provision in a contract must be
interpreted in light of the other provisions so that each is given the meaning
suggested by the contract as a whole,”  La. Civ.Code art. 2050.   “When a
contract is not ambiguous or does not lead to absurd consequences, it will be
enforced as written and its interpretation is a question of law for a court to
decide.”  American Deposit Ins. Co. v. Myles, 00-2457, p.5   (La. 4/25/01),
783 So.2d 1282, 1286.
The intent of the parties of this contract is clear. CPOA intended to
buy the eleven percent (11%) membership interest from AA for a price. AA
reciprocated and accepted that offer for the sale of their eleven percent
(11%) membership interest. Pursuant to the Sale, transfer, assignment of
membership interest, and resignation of a member of the executive
committee, CPH “desire[d] to purchase the [m]embership [i]nterest from
[AA] … and to settle all disputes between the parties.” Likewise, AA signed
the Sale agreement and desired the same. In accordance with the sale, AA
sold, transferred, and assigned CPH all of their rights, title, and interest in




Carbone Properties of Audubon, L.L.C.   The intent of the parties was to
transfer the membership interest and in fact that transfer has taken place. The
Sale became effective as of November 20, 2004, “on and only on its
execution and delivery by each party, payment of the initial twenty-five
thousand dollars ($25,000) … and recordation of the mortgage and security
documents provided for [in the Sale agreement].” CPOA has offered no
evidence to rebut these and other factual assertions, has presented no
genuine issues of material fact that are in dispute, and thus AA’s Motion for
Summary Judgment was granted.  Thus, the judgment of the district court
must be affirmed.
CPOA also asserts that the contract should be dissolved based on a
fortuitous event, which made their performance impossible. An Act of God
or “a fortuitous event is one that, at the time the contract was made, could
not have been reasonably foreseen.” La. Civ. Code art. 1875. As the
Appellants (CPOA) state, there is little question that Hurricane Katrina was a
fortuitous event. Even with our foreknowledge that the hurricane was rearing
its way toward the state, the damage and effects of the storm were
unexpected and unprecedented. And although its damages left some
obligations impossible to fulfill, not all contracts are nor should they be
rendered dissolved unless the law requires.




For further guidance, the Louisiana Civil Code in Article 1873
provides in pertinent part that, “[a]n obligor is not liable for his failure to
perform when it is caused by a fortuitous event that makes performance
impossible.”  This article introduces the defense of impossibility of
performance. La. Civ. Code art. 1873, com. (c).  The contract can be
dissolved if, “the entire performance owed by one party has become
impossible because of a fortuitous event.” La. Civ. Code art. 1876. Then the
other party may recover any performance he has already rendered. Id.
Article 1873 also provides that, “an obligor is liable when the fortuitous
event occurred after he has been put in default.”
The Supreme Court held in Dallas Cooperage & Woodenware Co. v.
Creston Hoop Co., 109 So. 844, (La. 1926) that “[t]he nonperformance of a
contract is not excused by a fortuitous event where it may be carried into
effect, although not in the manner contemplated by the obligor at the time
the contract was entered into.” Id.
This same disposition was reiterated by this Court, in Schenck v.
Capri Construction Co. Inc., 194 So.2d 378 (La. App. 4 Cir. 1967), which
concerned the  performance of a contract after a hurricane.    Schenck
involved an action by homeowners to cancel a construction contract for an
addition to their home. The performance of the contract only became more




difficult for homeowners after the hurricane because of the expenses in
repairing their home.  The “plaintiffs’ contention [was] not based on a matter
of storm damage to the building but [rather] upon economic feasibility.”
Schenck, 194 So.2d at 380.  However, this Court determined that
performance of the contract “was not rendered impossible but only more
difficult or more burdensome.”   Schenck, 194 So. 2d at 380.
The case at bar, very much like the Schenck case, brings the same
problem to light. Marshall has terminated CPOA’s construction loan and the
hotel franchise agreement has been terminated. CPOA can not now rescind
its agreement with AA or try to dissolve the contract simply because the
means of fulfilling that agreement have become more difficult. It is
“immaterial to the plaintiff how the defendant secure[s] the article [or rather
the financing] which it [is] obligated to deliver.” Dallas Cooperage &
Woodenware Co., supra, 109 So. 844, (La. 1926).  The defendant can only
claim force majeure as an excuse when encountered by an “insurmountable
obstacle that make[s] the performance actually impossible.” 5 La. Civ. L.
Treatise, Law of Obligations § 16.17 (2d. ed.).
In Picard Const. Co. v. Bd. Of Com’rs of Caddo Levee Dist., 109 So.
816 (La. 1926), a construction company undertook excavating work and ran
into a peculiarly hard subsoil formation. The Supreme Court concluded that




the agreements legally entered into have the effect of law for the parties and
must be performed in good faith, thus, “it follows that a party is obliged to
perform a contract entered into by him if performance be possible at all, and
regardless of any difficulty he might experience in performing it.” Id. at 818;
See also Hugh v. Grant Parish School Bd., 145 So. 794, 797 (La. App. 2d
Cir. 1933). Thus the case at bar should follow settled Louisiana
jurisprudence. The unexpected and unforeseen damage of Hurricane Katrina
does not change the agreement between these parties; therefore, this is an
agreement which can still be performed. The contract is valid and the
judgment of the district court stands.
CPOA’s next assignment of error addresses the district court’s
granting of the exception of no cause of action. The appellate courts review a
trial court’s decision on an exception of no cause of action de novo “because
the exception raises a question of law and the lower court’s decision is based
only on the sufficiency of the petition.” Brookewood Investments Co., L.L.C.
v. Sixty-Three Twenty-Four Chef Menteur Highway, L.L.C., 07-0050 (La.
App. 4 Cir. 5/16/07), ___ So.2d ___, 2007 WL 1574908; (citing City of New
Orleans v. Bd. Of Comm’rs of Orleans Levee Dist., 93-0690, p. 28 (La.
7/5/94), 640 So.2d 237, 253). Louisiana Code of Civil Procedure article 931
provides that, “no evidence can be introduced to support or to controvert an




exception of no cause of action,” but rather, the issue must be decided on the
face of the petition, whether the plaintiff is legally entitled to the relief
sought.  Brookewood Investments, Id. at *1 (citing Everything on Wheels
Subaru, Inc. v. Subaru South, Inc., 616 So.2d 1234, 1235 (La. 1993).
Louisiana has a system of fact pleading, and “it is insufficient to state a
cause of action where the petition simply states legal or factual conclusions
without setting forth facts that support the conclusions.”   Id.  The question in
the matter sub judice is whether the appellants state a valid cause of action.
The appellants are seeking a dissolution of the Sale based on the defense of
impossibility of performance, but just as previously recognized, the Sale
should be upheld. The Sale only became more burdensome, but not
impossible.  Thus, the appellants do not state a cause of action.
DECREE
For the foregoing reasons, we affirm the judgment of the district
court.
AFFIRMED

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