U. S. Bank Association, f/k/a First Bank National Association Trust VS Phillip Vincent Maranto and Vivian Maranto
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NOT DESIGNATED FOR PUBLICATION STATE OF LOUISIANA J COURT OF APPEAL FIRST CIRCUIT 2010 CA 0766 S U BANK NATIONAL ASSOCIATION F FIRST NATIONAL BANK A K ASSOCIATION TRUST ACTING SOLELY IN ITS CAPACITY AS TRUSTEE FOR EQCC HOME EQUITY LOAN TRUST 1991 1 VERSUS PHILLIP VINCENT MARANTO ET UX Judgment rendered OCT 2 9 2010 On Appeal from the 18 Judicial District Court Parish of West Baton Rouge State of Louisiana Suit No 34 Division B 013 The Honorable J Robin Free Judge Presiding Charles K Watts Counsel for the Petitioner Mark C Garrison DefendantinIntervention Appellee Baton Rouge Louisiana S U Bank National Association FK First A National Bank Association Trust Acting Solely In Its Capacity as Trustee for EQCC Home Equity Loan Trust 1991 Dale M Maas Counsel for Defendant IntervenorAppellant Baton Rouge Louisiana Vincent Joseph Maranto BEFORE KUHN PETTIGREW AND KLINE JJ Judge William F Kline Jr retired is serving as judge pro tempore by special appointment of the Louisiana Supreme Court KLINE J Vincent Maranto appeals a summary judgment granted in favor of U Bank S National Association U Bank The judgment declared valid an act of donation S of immovable property from Maranto to his father and dismissed Maranto s petition for intervention For the following reasons we affirm the judgment of the trial court PERTINENT FACTS AND PROCEDURAL HISTORY Maranto donated certain immovable property to his father in 1998 by a document entitled Act of Donation This document was not in authentic form Subsequently Maranto father and mother mortgaged the donated property and s executed a promissory note Funds from the mortgage were used to pay off two prior mortgages that encumbered the property and that Maranto owed Subsequently Maranto father died In 2004 U Bank filed a petition for s S executory process seeking to foreclose on the mortgage for default and nonpayment of the promissory note Maranto then filed a petition for intervention seeking to avail himself of a declaration that his own act being the 1998 donation to his father was null and invalid He thus seeks to be recognized as the owner of the property to have the mortgage in favor of U Bank be declared null and S invalid and to have the mortgage erased and cancelled from the conveyance records On U Bank motion the trial court granted summary judgment in favor Ss of U Bank and against Maranto The trial court ordered that the 1998 Act of S Donation between Maranto and his father be declared valid and lawful Accordingly it dismissed Maranto petition for intervention with prejudice s The record reflects that Maranto had previously filed a motion for summary judgment seeking a ruling that the donation at issue was invalid That motion for reasons unknown was never heard We observe that the validity of the donation was the common determinative issue of both motions Since we affirm the n ial court judgment this s issue is resolved by the final judgment under consideration and Maranto petition for intervention is dismissed with s Prejudice 2 Maranto now appeals asserting two assignments of error relative to the issue of validity of the donation to wit 1 The charge being 35 and the value of the property of 90 089 00 000 70 being greater than the charges plus onehalf and with the charges being even less than two thirds the value of the property by law the Trial Court erred in granting the Summary Judgment and in not applying donation rules to require an authentic act for this donation to be valid and erred in not ultimately invalidating both the donation and the mortgage on the same property 2 The evidence and stipulation being that the Act of Donation from Vince Maranto to his father was not in authentic form such transaction was null and the Trial Court erred in accepting the donation and subsequent mortgage as valid and thereby dismissing the Intervention DISCUSSION Appellate courts review a trial court decision to grant a motion for s summary judgment de novo using the same criteria that govern the trial court s consideration of whether summary judgment is appropriate Waguespack v Richard Waguespack Inc 06 0711 p 2 La 1 Cir 2 959 So App 07 14 2d 982 984 The motion should be granted if the pleadings depositions answers to interrogatories and admissions on file together with affidavits if any show that there is no genuine issue as to material fact and that the mover is entitled to judgment as a matter of law La C art 966B In the matter before us no P factual issues are in dispute Accordingly we determine whether U Bank was S entitled to entry of summary judgment as a matter of law Validity ofDonation All parties concede that the donation is not in proper authentic form to effect a valid gratuitous donation When the act of donation was executed in 1998 La C art 1536 governing donation inter vivos of immovable property provided as follows Louisiana Civil Code art 1541 effective January 1 2009 now governs these donations This article provides as s toI10v 3 An act shall be passed before a notary public and two witnesses of every donation inter vivos of immovable property or incorporeal things such as rents credits rights or action under penalty of nullity The document was not witnessed by the required two witnesses The trial court however concluded from the undisputed facts of the case that the donation was an onerous donation Rules applicable to inter vivos donations do not apply to onerous donations if certain conditions are met La C art 1526 in effect in 1998 Article 1526 provided as follows In consequence the rules peculiar to donations inter vivos do not apply to onerous and remunerative donations except when the value of the object given exceeds by onehalf that of the charges or of the services Emphasis added Here the value of the property donated was 70 00 000 s Maranto two mortgages were charges imposed on the donee that had to be paid off These charges equaled 35 In concluding that the donation was valid the trial 80 089 court applied Art 1526 pursuant to the Louisiana Supreme Court directions in s Moore v Sucher 234 La 1068 102 So 459 1958 In Moore 234 La at 2d 1074 102 So at 461 the supreme court ruled as follows 2d It will thus be seen that the charge here imposed on the donee exceeds onehalf of the value of the object given This being true the act here under attack has more of character of an onerous contract than of a donation Maranto argues that the trial court misapplied Art 1526 and that the trial court was bound to follow Whitman v Whitman 206 La 1 18 So 633 1944 2d In Whitman 206 La at 22 18 So at 640 the supreme court observed as 2d follows We have found from the evidence that the services rendered by the donee in this instance in compliance as far as he could comply with the obligations imposed upon him by the donation greatly exceeded twothirds of the value of the property donated which is the same as to say that the value of the property donated did not amount to one A donation inter vivos shall be made by authentic act under the penalty of absolute nullity unless otherwise expressly permitted by law 4 Louisiana Civil Code art 1526 was amended effective January I 2009 The terms and effect of this amendment are discussed below 4 and onehalf times the value of the services rendered by the donee He did not wilfully violate his obligation to provide a home for and support his mother Maranto cites two First Circuit cases issued subsequent to Moore that adopt the Whitman interpretation Clarke v Brecheen 387 So 1297 La App 1 Cir 2d 1980 and Succession of Danos 359 So 679 La App 1 Cir 1978 2d Under the Moore analysis the donation at issue is onerous and valid since the rules applying to inter vivos donations do not apply Under the Whitman analysis the charges do not exceed twothirds the value of the property and regular donations rules would apply rendering the donation invalid The discrepancy in interpreting Art 1526 appears to arise from the meaning Louisiana courts have given or not given to the phrase exceeds by one half Article 1526 in effect here provides that the rules peculiar to intervivos donations do not apply except when the value of the object given exceeds by onehalf that of the charges or of the services We are confronted by the inconsistent manner in which the courts have applied Art 1526 As this court observed in Succ of Danos 359 So at 681 2d the correct mathematical meaning of Article 1526 has been the source of considerable confusion in the jurisprudence Subseqent to the supreme court s decision in Moore this court followed the Whitman formulation in Clarke and Succ of Danos Further law review articles have discussed the historical discrepancies and have generally concluded that the Whitman formula is the more correct application of Art 1526 See Comment Personal Services About the Home 23 La 418 432 n 1963 and J Denson Smith Particular Rev L 78 Contracts Sale 19 La 319 32223 1959 Rev L Another concern is the recent amendment to Art 1526 effective January 1 2009 The article now provides 5 The rules peculiar to donations inter vivos do not apply to a donation that is burdened with an obligation imposed on the donee that results in a material advantage to the donor unless at the time of the donation the cost of performing the obligation is less than two thirds of the value of the thing donated This new articulation appears to codify the Whitman formulation and the comment to the article states that the new language is not intended to change the law Even so while this express intent of the legislature serves us well we must observe that the interpretation of the law belongs to the judiciary and not the Legislature Mallard Bay Drilling Inc v Kennedy 041089 p 14 La 05 29 6 914 So 533 544 2d In light of these considerations this court now faces the issue of whether the trial court ruled appropriately in following the Louisiana Supreme Court decision s in Moore which is its most recent ruling on the interpretation of La C art 1526 We conclude that since Moore is the supreme court most recent s pronouncement on the interpretation of Art 1526 we are constrained to follow it The supreme court most recent pronouncement is controlling s See Scott v American Tobacco Co 980452 p 4 La 4 Cir 11 725 So 10 12 App 98 4 2d Further the supreme court favorably cited the rule as explained in Moore the year after deciding it in Garcia v Dulcich 237 La 359 368 69 111 So 309 312 2d 1959 Accordingly we conclude the trial court did not err in concluding that the donation at issue was valid Further because we have concluded that the onerous donation was a valid one we find it unnecessary to address the issue of whether Maranto orally transferred the property to his father We therefore pretermit discussion of this issue 0 Finding no merit in Maranto assignments of error we affirm the judgment s of the trial court relying on the last expression of the Louisiana Supreme Court in Moore v Sucher 234 La 1068 102 So 459 1958 2d DECREE For the above reasons we affirm the judgment of the trial court Costs of this appeal are assessed to Vincent Maranto AFFIRMED V
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