Stephen J. Williams VS International Offshore Services, L.L.C.
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STATE OF LOUISIANA COURT OF APPEAL FIRST CIRCUIT 20ll C W 1240 2011CW1318 2011 CA 1369 STEPHEN J WILLIAMS VERSUS INTERNATIONAL OFFSHORE SERVICES LLC DATE OF JUDGMENT 0 2012 ON APPEAL FROM THE SEVENTEENTH JUDICIAL DISTRICT COURT NUMBER 116856 DIV A PARISH OF LAFOURCHE STATE OF LOUISIANA HONORABLE JOHN E LEBLANC JUDGE Setifi O r F Ct3 iA Ss f s Gn 35 Io So TiP k CGAR7 d C isses Gilbert R Buras 7r New Orleans Louisiana rs 2 P Tlfe R Sg ult8 vs G As F KPF a J Ge Counsel for Plaintiff Appellee Stephen J Williams Daniel A Cavell Camille A Morvant Thibodaux Louisiana Christopher H Riviere Eric L Trosclair Thibodaux Louisiana Marc S Whitfield Jr Harry Philips Baton Rouge Louisiana J Counsel for Defendant Appellant International Offshore Services LLC James Dasso Jeffrey A Soble Counsel Pro Hac Vice Chicago IL Martin S Triche Napoleonville Louisiana BEFORE CARTER C WHIPPLE KUHN GUIDRY AND WELCH JJ J Disposition DISMISSED JUDGMENT VACATED 2011 CW 1318 GRANTED AND 2011 CW 1240 KUHN J appellant Defendant International Offshore Services LLC IOS appeals the trial court judgment granting summary judgment in favor of plaintiff s appellee Stephen Williams declaring that he was not prohibited from engaging in certain business operations by the terms of either an employment agreement or an operating agreement entered into by the parties Also referred to this panel on review are two writ applications Because we conclude that the trial court lacked subject matter jurisdiction over Williams claims we vacate the judgment granting declaratory relief dismiss 2011 CW 1240 as moot and grant 20ll CW 1318 to sustain the exception raising the objection of lack of subject matter jurisdiction FACTUAL AND PROCEDURAL HISTORY In 2006 Williams founded IOS a corparation which owns and operates several marine vessels that provide support services to the oil and gas indushy In January 2009 Williams sold the majority interest in IOS to Ferry Holdings Corp Ferry a subsidiary of Platinum Equity LLC As part of the sale Williams retained a 20 ownership interest and also entered into an employment agreement to work as the CEO of IOS for two years following the sale the Employment Agreement which included a non provision compete Section 42 of the Employment Agreement states in pertinent part Competition Non Executive agrees that during the Employment Term and provided that the Company continues to pay Exewtive his Base Compensation Executive fur agrees and her covenants for a period of two years following the Terminafion Date within the Restricted Territory Executive shall not directly or indirectly a Carrv on or engage in the Restricted Business For this purpose the Restricted Territory means x the State of Louisiana Parishes of Acadia Ascension Assumption Calcasiea Cameron East Baton Rouge Iberia Iberville Jeff Davis Jefferson Lafayette Lafourche Orleans Plaquemines St Bernard St Charles St James St John the Baptist St Landry St Martin St Mary St Tammany Terrebonne Vermilion and West Baton Rouge the State of Texas County of Harris and the State of Alabama County of Mobile The Restricted Business means the business presentty conducted by the Company or any subsidiary which the parties agree consists of A providing offshore marine transportation to the oil and gas indushy B operating offshore construction barge offshore pipeline lay and bury barge or offshore well intervention and diving support barge C operating any offshore supply vessel or tug or D acting as a broker or intermediary with respect to any of the foregoing 2 In July 2009 Ferry sought to refinance the purchase of its membership interest in IOS which included bringing in more equity owners As a result a Third Amended and Restated Operating Agreement the Operating Agreement was executed by all members of IOS including Williams The Operating Agreement dated July 7 2009 contained a non provision which was compete substantially similar to the non provision in the Employment Agreement compete I and also contained an arbitration provision After serving his two term Williams resigned as CEO of IOS in year January 2011 Following his resignation Williams purchased four liftboats through his newly formed company Alliance Liftboats LLC for the purpose of providing liftboat services to the oil and gas industry On January 17 2011 IOS and Ferry instituted a claim for arbitration with the American Arbitration Association asserting that Williams breached the non compete terms of the Operating Agreement and fiduciary duties he owed to IOS IOS and Ferry requested that the arbitration panel 1 enter an award in favor of IOS and Ferry and against Williams enjoining him from violating the Operating Agreement ar his fiduciary duties 2 declare the respective rights and obligations of Williams IOS and Ferry under the Operating Agreement and 3 award damages to IOS and Ferry Section 13 of the Operating Agreement defines Restricted Business and mirrors the anguage of Section 42 of 2 the Employment Agreement as set forth above The 3 arbitration provision in the Operating Agreement states in pertinent part Binding Arbitratioo Any controversy or claim arising out of or relating to this Operating Agreement including to interpret or enforce any provision of this Operating Agreement shall be settled by final and binding arbitration administered by the American Arbitration Association under its Commercial Arbitration Rules and judgment on the award rendered by the azbitrators may be ein any tered court of competent jurisdiction Any arbitration pursuant to this Section 17 shall be conducted in St Louis Missouri Any 19 arbitration awazd may be entered in and enforced by any court of competent jurisdiction and the parties hereby consent and commit themselves to the jurisdiction a venue of any state or federal d court located in St Louis Missouri for purposes of the enforcement of any arbitration award Each of the parties hereto hereby irrevocably waives to the fullest extent permitted by applicable law any objection which it may now or hereafter have to the laying of such venue or any defense of inwnvenient forum Emphasis added 3 On January 19 2011 Williams filed a petition for declaratory judgment naming IOS as defendant Although the original petition did not include any allegations about the non provision in the Operating Agreement Williams compete supplemented his petition in March 2011 to include allegations that he was entitled to a declaration that his activities did not violate either the Employment Agreement or the IOS filed a I Operating Agreement peremptory exception raising the objection of no cause of action and a dilatory exception raising the objection ofprematurity contending that it was entitled to a dismissal of Williams claims as related to the Operating Agreement because Williams failed to abide by the arbitration agreement as set forth in the Operating Agreement After a hearing on May 25 2011 the trial court denied relief in open court and on June 24 2011 signed a judgment overruling IOS s exceptions of no cause of action and prematurity On July 8 2011 IOS filed a writ application with this court bearing number 2011 CW 1240 seeking review of the trial court June 24 2011 judgment s denying the exceptions of no cause of action and prematurity with regard to the claims as to the Operating Agreement 4 This court ordered that the writ be referred to the panel to which the related appeal was assigned See Williams v Int 1 Ofjshore Services L 2011 La App lst Cir 7unpublished C 1240 an 11 22 writ action During May 2011 Williams filed a motion for summary judgment averring that there was no genuine issue of fact regarding whether he was competing against IOS in contravention of the terms of the non clauses in the Employment compete Agreement and Operating Agreement Williams requested that the trial court decree that he was not prohibited from engaging in certain specified business IOS originally filed a writ application on these issues on June 21 201 l but due to defects in the filing the writ was not considered See Wlllia x InPI Ojfshore Servdces L 2011 La App lst Cir 6 xs C 1122 an 11 30 unpublished writ action 4 I activities Williams also sought a declaration that the non and non compete solicitation provisions in both the Employment Agreement and the Operating Agreement were null and unenforceable or alternatively did not prevent Williams from engaging in certain specified business Before the hearing on Williams motion for summary judgment however IOS passed a corparate resolution stating that it released Williams from all claims arising from the non provision as found in the Employment Agreement compete In the corporate resolution IOS expressly reserved all its rights in connection with the non provision as found in the Operating Agreement compete On May 26 20ll IOS filed a declinatory exception raising the objection of lack of subject matter jurisdiction avening that as a result of its corporate resolution there was no longer a justiciable claim or controversy regarding the Employment Agreement and thus any claim relating to it should be dismissed for lack of subject matter jurisdiction Because the exception was not filed in compliance witb the required time period prior to the scheduled hearing date as mandated by the district court rules the trial court declined to hear the exception prior to ruling on Williams motion far summary judgment A hearing on Williams motion for summary judgment was held on June 3 201 l The trial court concluded that Williams was not prevented or prohibited by either the Employment Agreement ar the Operating Agreement from engaging in the liftboat business engaging in the business of providing oil and gas well plug and abandonment services or engaging in any other specified business and on June 21 2011 signed a judgment granting summary judgment in favor of Williams Also on June 21 2011 the trial court heard IOS exceprion of lack of s subject matter jurisdiction premised on the corporate resolution and overruled it in open court A written judgment to that effect was signed on July 12 2011 5 IOS subsequently filed a writ application challenging the trial court s overruling of its exception of lack of subject matter jurisdiction That writ application like the earlier one was also refened to the panel to which the related appeal was assigned See Williams u Int Offshore Services L 2011 l C 1318 La App 1st Cir 8 unpublished writ action Lastly IOS filed this an 11 15 appeal challenging the 7une 21 2011 judgment which granted Williams motion for summary judgment on the merits of his claim for declaratory relief and the July 12 2011 overruling ofthe exception of lack of subject matter jurisdiction DISCUSSION A court subject matter jurisdiction is an issue that cannot be waived ar s conferred by the consent of the parties The issue of subject matter jurisdiction may be raised at any time even y the court on its own motion and at any stage of an action Joseph v Ratcliff 2010 La App lst Cir 3 63 So 220 1342 11 25 3d 224 Appellate courts have the duty to examine subject matter jurisdiction sua sponte even when the parties do not raise the issue Motorola Inc v Associated Indem Corp 2002 La App 1 st Cir 4 867 So 715 717 0716 03 30 2d Subject matter jurisdiction is the legal power and autharity of a court to hear and determine a particular class of actions or proceedings based upon the object of the demand the amount in dispute or the value of the right asserted La C P art 2 A judgment rendered by a court which has no jurisdiction over the subject matter of the action ar proceeding is void See La C arts 3 and 925 P C Both the federal and state arbitration acts indicate the strong legislative policies of both sovereigns favoring arbitration See 9 U C S 1 et seq La R S 4201 9 et seq Any doubt as to whether a controversy is arbitrable should be Both S acu are almost identical in substance as they were both drafted from the Uniform Arbitration Act See FLA CardServires N u Weaver 2010 La 3 A 1372 1 15 62 So3d 709 7L 6 resolved in favor of arbitration Woodson Lonstr Co Inc v R Abshire L Constr Co Inc 459 So 566 569 La App 3d Cir 1984 2d At oral arguments the parties verified to this court that Williams claims under the Operating Agreement were in arbitration Once arbitration has commenced the courts are precluded from exercising jurisdiction Peter Vicari General Contractor Inc u St Pierre 2002 La App Sth Cir 10 831 250 02 16 2d So 296 299 citing Woodson Constn Co I 459 So at 570 zc 2d 71 Accordingly sua sponte we conclude that the trial court did not have subject matter jurisdiction over the claims arising out of the Operating Agreement and therefore incorrectly granted si judgment in favor of Williams on this mmary basis In appeal of the grant of summary judgment as well in its writ application bearing number 2011 CW 1318 IOS challenges the trial court denial of the s exception of lack of subject matter jurisdiction insofar as Williams claims to relief under the Employment Agreement IOS urges that by virtue of the corporate resolution that released Williams from any and all claims IOS may have arising from the non provisions in the Employment Agreement Williams compete demand for declaratory relief seeking a decree of his obligations under the Employment Agreement was rendered moot thereby further depriving the trial court of subject matter jurisdiction Specifically IOS contends that based on its subsequent corporate action there no longer remains any justiciable claim or controversy as to the non agreement in the Employment Agreement compete If a case is moot there is no subject matter on which the judgment of the court can operate Council of City of New Orleans v Sewerage and Water B of New Orleans 2006 La 4953 So 798 80L It is well settled that 1989 07 11 2d courts will not decide abstract hypothetical or moot controversies or render A reconventional demand IOS had asserted was voluntarily dismissed with prejudice 7 advisory opinions with respect to controversies In the Matter ofE 2009 W 1589 La App lst Cir 538 So 1033 1036 Cases submitted for adjudication 10 7 3d must be justiciable ripe for decision and not brought prematurely A justiciable controversy is one presenting an existing actual and substantial dispute involving the legal relations of parties who have real adverse interests and upon whom the judgment of the court may effectively operate through a decree of conclusive character Women Health Clinic v State 2002 La App 1 st Cir 5 s 0016 02 10 825 So 2d 1208 1210 writ denied 2002 La 11 828 So 586 02 1 2d Moreover even though the requirements ofjusticiability are satisfied when the suit is initially filed when the fulfillment of these requirements lapses at some point during the course of the litigation before the moment of final disposition mootness occurs In such a case there may no longer be an actual controversy for the court to address and any judicial pronouncement on the matter would be an impermissible advisory opinion Thus jurisdiction although once established may abate if the case becomes moot In the Matter ofE 38 So at 1037 W 3d Because IOS voluntarily waived its rights arising from the non compete provisions in the Employment Agreement prior to rendition of summary judgment in favor of Williams and in light ofthe allegations of Williams petition there was no justiciable controversy for the trial court and consequently this court to act upon in other words with the corporate resolution waiver there no longer existed a controversy presenting an actual and substantial dispute involving the legal relations of the real adverse interests of the parties relative to the Employment Agreement See Chauvin v Wellcheck Inc 2005 La App lst Cir 1571 06 9 6 938 So 114 118 a lirigant not asserting a substantial existing legal 2d right is without standing to seek a declaratory judgment Accordingly we conclude that the trial court did not have subject matter jurisdiction over the claims a arising out of the Employment Agreement and therefore incorrectly granted summary judgment in favor of Williams on this basis CONCLUSION Because the trial court did not have jurisdiction over Williams claims arising out of either the Operating Agreement as those claims were in arbitration pursuant to the arbitration provision ar the Employment Agreement as IOS s corporate resolution waiving any claims it may have had against Williams resulted in no justiciable controversy and therefore rendered his request for declaratory relief moot we vacate the trial court judgment granting summary judgment in s favar of Williams Likewise we grant 20ll CW 1318 filed by IOS to reverse the trial court July 12 2011 judgment averruling the exception raising the objection s of lack of subject matter jurisdiction to decide Williams claims relative to the Employment Agreement We hereby order that the exception be sustained and we hereby dismiss Williams claims relative to the Employment Agreement And because the trial court lacked subject matter jurisdiction over any of Williams claims for declaratory relief writ application bearing number 2011 CW 1240 also submitted by IOS wherein it sought review of the triai court June 24 2011 s judgment overruling its exceptions raising the objections of no cause of action and prematurity is dismissed as moot Appeal costs are assessed against plaintiff appellee Stephen Williams JUDGMENT VACATED 2011 CW 1318 GRANTED AND 2011 CW 1240 DISMISSED 9 STEPHEN J WILLIAMS STATE OF LOUISIANA COURT OF APPEAL VERSUS FIRST CIRCUIT INTERNATIONAL OFFSHORE 2011 CW 1240 SERVICES 2011 CW 1318 LLC 2011 CW 1369 WffiPPLE J dissenting U I respectfully dissent from the majority opinion vacating the June s 21 2011 partial summary judgment and granting IOS writ application in s 2011 CW 1318 and dismissing the writ application in 2011 CW 1240 each of which I address individually below 2011 CW 1240 In this writ application IOS challenges the trial court denial of its s exceptions of no cause of action and prematurity filed in response to s Williams Second Supplemental and Amended Petition wherein Williams challenged his obligations under the non provision of the compete Operating Agreement In support of these exceptions IOS avers that pursuant to the arbitration clause in the Operating Agreement any dispute as to the terms of the Operating Agreement including interpretation of the non compete provision therein must be decided in the arbitration forum At the hearing on IOS exceptions of no cause of action and s prematurity the trial court denied the exceptions in open court concluding that Williams p etition stated a cause of action and was not s P remature Specifically the trial court found that Williams had a cause of action and that w or not that is concurrent with the arbitration agreement or hether not was not the issue for the trial court In the present matter the parties do not dispute that there is a written arbitration provision in the Operating Agreement Rather the issue is whether this specific non issue is referable to arbitration IOS compete avers this issue is referable to arbitration relying on the presumption of arbitrability and the language of the arbitration provision IOS contends the arbitration provision in the Operating Agreement broadly covers any controversy or claim Thus IOS argues because Williams supplemental s petition for declaratory judgment seeks a declaration that the non compete clause in the Operating Agreement would not restrict certain activities this claim is subject to arbitration In opposition Williams avers that public policy and judicial efficiency provide an exception under these particular facts and that the non compete issue should remain pending in the district court ancillary to his original petition As support Williams notes that Louisiana has a strong public policy of restricting non agreements citing SWAT 24 competition Shreveport Bossier Inc v Bond 2000 La 6 808 So 2d 294 1695 O1 29 s Louisiana policy against non agreements and the exceptions competition thereto are set forth in LSA 23 Specifically LSA 23 S R 921 SA R 921 provides 1 Every contract or agreement ar provision thereof by which anyone is restrained from exercising a lawful profession trade ar business of any kind except as provided in this Section shall be null and void However every contract or agreement or provision thereof which meets the exceptions as provided in this Section shall be enforceable 2 The provisions of every employment contract or agreement or provisions thereof by which any foreign or domestic employer or any other person or entity includes a choice of forum clause or choice of law clause in an employee contract s of employment or collective bargaining agreement or attempts to enforce either a choice of forum clause or choice of law clause in any civil or administrafive action involving an employee shall be null and void except where the choice of forum clause or choice of law clause is expressly lrnowingly and voluntarily ageed to and ratified by the employee after the 2 occurrence of the incident which is the subject of the civil or administrative action Emphasis added In sum LSA 23 clearly provides that every choice of SA R 921 2 forum and choice of law clause in agreements between employees and employers is null unless agreed to by the employee after the incident As such Williams avers that 1 it is undisputed that IOS was his employer 2 IOS is now attempting to remove the non issue as related to the compete Operating Agreement to a new forum the arbitration forum and 3 to allow such would violate the public policies set forth in La R 23 S 921 2 A In evaluating these public policy arguments I note that the parties do not cite nor have I found a case where an arbitration clause was set aside specifically for being in violation of Louisiana public policy against s compete non agreements However the clear language of LSA 9 S R 4201 provides an exception to arbitration clauses for such grounds as exist at law or in equity for the revocation of any contract Furthermore as stated by the United State Supreme Court in M Bremen v Za Off S ata Shore Company 407 U 1 15 92 S Ct 1907 1916 32 L Ed 2d 513 1972 A S contractual forum of choice clause should be held unenforceable if enfarcement would contravene a strong public policy of the forum in which suit is brought whether declared by statute or by judicial decision Zapata involved a contract for a tug owner to tow a barge from Louisiana to Italy The contract contained a choice clause far the London Court of Justice forum of Ultimately the Supreme Court remanded the matter stating Although their opinions are not altogether explicit it seems reasonably clear that the District Court and the Court of Appeals placed the burden on Underwater to show that London would be a more convenient forum than Tampa although the contract expressly resolved that issue The correct approach would have been to enforce the forum clause specifically unless Zapata could clearly show that enforcement would be unreasonable and unjust or that the clause was invalid for such reasons as fraud or overreaching Accordingly the case must be remanded for reconsideration Emphasis added Shore Off 92 S Companv ata 3 Ct at 1916 Counsel for IOS further argues that any public policy in LSA S R 921 23 should not trump the Federal Arbitration Act In support IOS cites Dahiva v Talmidge International LTD OS La App 4 Cir 5 0514 06 26 931 So 2d 1163 In Dahiva a foreign maritime warker brought suit in a Louisiana district court far injuries His maritime employer sought to stay the proceeding pending arbitration of the claim as required by the Convention on the Recognition and Enforcement of Foreign Arbitral Awards Similar to the present matter the plaintiff argued that Louisiana s clause selection forum anti provision as set forth in LSA 23 SA R 921 2 and the public policies therein conflict with and prohibit the Convention s mandate to enforce the arbitration clauses The Fourth Circuit ultimately rejected the argument and ordered arbitration but only after weighing the two competing policies at play i Louisiana policy against forum e s selection clauses in employment agreements and the Conventiods policy of rigorous enforcement of arbitration agreements in order to have predictabiliry in the resolurion of disputes in the international commercial system The Fourth Circuit found the federal policy outweighed the Louisiana public policy noting the Louisiana policy seeks to protect Louisiana citizen and the plaintiff in the case at hand was a employees resident and citizen of India Notably Dahiva did not establish a steadfast rule that federal law always supercedes state law that purports to nullify a forum selection clause rather Dahiva recognized that the competing purposes of the state and federal law must be weighed against each other On this basis Williams counters that the operative language of the compete non agreements in the Employment Agreement and Operating 4 Agreement are identical and are both governed by Louisiana law Therefore he contends that maintaining the claim in the district court as it pertains to both the Employment Agreement and the Operating Agreement serves the interest of justice by avoiding or reducing the possibility of inconsistent judgments on the same material facts and application of law e i the district court finding that Williams proposed new business s ventures did not violate the language of the non agreement in the compete Employment Agreement but the arbitration panel finding that the new business ventures did violate the same non agreement as set forth in compete the Operating Agreement I agree In particular I note that LSA 9 specifically provides an S R 4201 exception to the application of arbitration clauses for such grounds as exist at law or in equity which include judicial efficiency and the prevention of inconsistent decisions Moreover given the status of the parties the nature of their relationship and the timing and purpose underlying the confection of the subsequent Operating Agreement I find no error in the trial court s ruling denying these exceptions by the defendant Although it is well established that arbitration is favored under state and federal law IOS arguments in this writ application raise several s concerns Plaintiff spetition for deciaratory relief involves interpretation of a non clause competition Virtually the same non clause is competition found in the Employment Agreement and the Operating Agreement between the parties It is undisputed that the Employment Agreement does not contain an arbitration clause and that all claims related to the non compete agreement as stated in the Employment Agreement are contractually and 2 Section 17 of the OperaYing Agreement states 2 Application of Louisiana Law This Operating Agreement and the application or interpretation hereof shall be governed exclusively by its terms and the law of the State of Louisiana without giving effect to principles of conflicts of laws 5 legally reserved to the district court As such I agree with Williams that inconsistent decisions could result if the district court interpreted the clause in the Employment Agreement while the arbitration panel interpreted the same language but as found in the Operating Agreement However the more compelling argument is that since the claim involves a compete non clause between an employee and employer allowing the defendants to transfer the claim to the arbitration panel and forcing plaintiff to be bound thereby would violate LSA 23 and the public S A R 921 2 policies therein Although this precept is qualified by In Re Gulf Fleet s Holdin wherein the court held that the public policy considerations of S R 921 LSA 23 unequal bargaining power and loss of livelihood do not come into play where the employee is the former owner of the company and the employment agreement was part of a multi dollar purchase million of the company these considerations are seemingly inapplicable under the particular facts presented herein Specifically in this case the dispute involves two contractual agreements the employee has specifically owner agreed and acknowledged in both contracts that there is a reservation of some rights to compete and the district court is exercising lawful jurisdiction to consider in a properly filed declaratory judgment action by the employee the very same provision which would be at issue in the subsequently confected Operating Agreement Accordingly I conclude the trial court did not err in denying IOS s exceptions of no cause of action and prematurity and hereby deny this application for supervisory writs Thus I find no error in the trial court s exercise of jurisdiction and to render declaratory judgment addressing the I 3 note that my colleagues conclude that the trial court had no jurisdiction herein because although nothing in this regard appears of record at oral argument and by a letter from defendants thereafter the parties counsel disclosed that some arbitration has occurred herein However I note that nothing has been presented to this court to establish that a final awazd has been confirmed Moreover in my opinion the fact of or propriety o an arbitration panel exercise of jurisdiction is neither dispositive or s persuasive in our resolution of the issues presented for review where as noted above the dispute involves two separate contractual agreements the employee and the owner purchaser have specifically agreed and acknowledged in both contracts that there is a reservation of some rights to compete and the district court is exercising lawful jurisdiction to consider in a properly filed declaratory judgment action by the employee the very same provision which would be at issue in a subsequently confected Operating Agreement 6 parties respective claims and defenses related to the non compete provisions in both the Operating Agreement and Employment Agreement 2011 CW 1318 In this writ applicarion IOS challenges the trial court denial of s s IOS exception of lack of subject matter jurisdiction regarding Williams s claim for declaratory judgment as to his obligations under the Employment Agreement Specifically IOS contends that by virtue of that the corporate resolution which it passed through which IOS released Williams from any and all claims arising from the non agreement in the Employment compete Agreement Williams demand for declaratory judgment decreeing his s obligations under the Employment Agreement was rendered moot thereby further depriving the trial court of subject matter jurisdiction Specifically IOS contends that based on its actions there no longer remains any justiciable claim or controversy as to the non agreement in the compete Employment Agreement Accardingly in this writ application IOS seeks reversal of the trial court July 12 2011 judgment denying its exception and s requests dismissal of the judicial proceedings and any resulting rulings in the trial court to the e they relate to the Employment Agreement ent The corporate resolution passed by IOS provides in pertinent part as follows BE IT HEREBY RESOLVED that International Offshore Services L IOS does hereby irrevocably and C unconditionally release Steven J Williams Williams from any and all Claims as defined below whether known or unknown asserted or unasserted which are in any way on account of relating to or arising from Section 4 Limitation on Activities of the International Offshore Services L C Employment Agreement signed by Williams on January 8 In 4 its writ application IOS also contends that the trial court erred in granting s Williams motion far summary judgment on his declaratory action claim involving the Employment Agreement before resolving IOS exception of lack of subject matter s jurisdiction However I also reject this argument as meritless finding no reversible enor on this basis 7 2008 a copy of which is attached to this Resolution and agrees that it will not enfarce or seek to enforce any Claims against Williams for any breach of the Limitation on Activities provisions of said Employment Agreement BE IT FURTHER RESOLVED that the above inevocable release does not nar does it in any way indicate any intent to waive ar release any Claims against Williams which are in any way on account of relating to arising out of or arising from the Third Amended and Restated Operating Agreement of International Offshore Services L dated July 7 2009 C Third Amended and Restated Operating Agreement or any earlier version of the operating agreements of IOS including without limitarion the Non provisions contained in Competition Section 13 of the Third Amended Operating Agreement or any similar provisions contained in any earlier versions of the operating agreements of IOS by operation of law or otherwise and IOS does hereby expressly reserve all of its rights under said Third Amended and Restated Operating Agreement and earlier versions and all claims it may have against Williams under said Third Amended Operating Agreement and Williams agrees to and consents to this reservation of rights under the Third Amended Operating Agreement BE IT FURTHER RESOLVED that for purposes of this Resolution Release and Agreement the term Claims comprehensively includes but is not limited to actions lawsuits proceedings claims causes of action demands grievances liabilities suits and judgments whether actual or potential whether presently known or unknown recognized by the law of any jurisdiction whether arising in tort in contract at law in equity at common law or under any federal state county or local statute ar law under any and all theories of recovery of whatsoever nature under any theory of liability whatsoever Emphasis added In denying the exception of lack of subject matter jurisdiction the trial court stated as follows The resolution by IOS seeks to walk away from the controversy But it this Court position and I do not feel s s that defeats subject matter jurisdiction Because it is still Mr s William right to determine the extent and scope of any limitations that the agreement may have put on him whether or not IOS chose to participate in the battle and certainly they did until the very end If a case is moot there is no subject matter on which the judgment of the court can operate Council of Citv of New Orleans v Sewera Water Board of New Orleans 2006 La 4 953 So 2d 798 1989 07 11 8 801 It is well settled that courts will not decide abstract hypothetical or moot controversies or render advisory opinions with respect to controversies In the Matter of E 2009 La App l Cir 5 W 1589 10 7 38 So 3d 1033 1036 Cases submitted for adjudication must be justiciable ripe far decision and not brought prematurely A controversy justiciable is one presenting an existing actual and substantial dispute involving the legal relations of parties who have real adverse interests and upon whom the judgment of the court may effectively operate through a decree of conclusive character Women Health Clinic v State 2002 La App l Cir s 0016 02 10 5 825 So 2d 1208 1210 writ denied 2002 La 11 828 02 1 So 2d 586 Moreover even though the requirements of justiciabiliry are satisfied when the suit is initially filed when the fulfillment of these requirements lapses at some point during the course of the litigation before the moment of final disposition mootness occurs In such a case there may no longer be an actual controversy for the court to address and any judicial pronouncement on the would matter be an impermissible advisory opinion Thus jurisdiction although once established may abate if the case becomes moot In the Matter of E 38 So 3d at 1037 W However exceptions to the mootness doctrine have been recognized Under the voluntary cessation exception if a defendant voluntarily stops wrongful conduct then that change alone does not make a case moot unless the defendant shows with assurance that there is no reasonable expectation that the alleged violation will recur Cat Meow Inc v City of New s Orleans throu Department of Finance 98 La 10 720 So 2d 0601 98 20 1186 1194 Where the defendant has voluntarily ceased the complained of conduct a court should consider 1 whether there is any reasonable 9 expectation that the a violation will recur and 2 whether there are leged ar unresolved collateral consequences such as an outstanding claim for compensatory or monetary relie In the Matter of E 38 So 3d at 1037 W The corporate resolution in the instant case does prevent IOS from asserting any and all claims against Williams under the non compete provision in the Employment Agreement Thus IOS would not be able to sue Williams under the non provision of the Employment compete Agreement for any of the business ventures in which he is now involved However contrary to the assertions by IOS the corporation resolution only releases Williams from any claims by IOS under the non in the compete Employment Agreement it does not release him from his obligations under the non provision compete Also with regard to unresolved collateral consequences as noted by Williams the resolution of the extent of his obligations under the non compete clause is relevant with regard to Williams sfiduciary obligations to IOS assumed pursuant to the Employment Agreement for which IOS could presumably sue alleging a violation of Williams fiduciary duties based on s his current business activities Accordingly because Williams is still bound by the obligations of the non agreement I conclude that a compete justiciable controversy remains and he is entitled to have the extent of those obligations judicially determined through his declaratory judgment action For these reasons I would deny IOS application for supervisory s writs of review at IOS costs challenging the trial court July 12 2011 s s judgment denying IOS exception of lack of subject matter jurisdiction s THE INSTANT APPEAL Turning to the instant appeal wherein IOS challenges the trial court s June 21 20ll judgment granting Williams smotion for summary judgment 10 in the judgment the trial court declared that Williams is not prevented by either the Employment Agreement or the Operating Agreement from engaging in certain listed business enterprises which the trial court determined were not prohibited by the provisions ofthe two agreements With S regard to IOS appeal of the trial court June 21 2011 judgment granting s s s Williams motion for summary judgment after the record was lodged this court issued a Rule to Show Cause Order on September 19 2011 which stated in pertinent part The June 21 2011 judgment on appeal in this matter appears to be a partial summary judgment without the proper designation of finality required by Pr C LSA art 1915 Therefore the parties are hereby ordered to show cause by briefs on or befare October 19 2011 why this appeal should not be dismissed by showing that La C art P B 1915 is not applicable or that there has been a designation of the judgments as final by the trial court under La C Art 1915 P B In response to this order the record in this matter was supplemented with a September 22 2011 Order signed by the trial court which states IT IS HEREBY ORDERED ADJUDGED AND DECREED that the Judgment signed on June 21 2011 granting summary judgment in favor of Mr Williams and against IOS constitutes a full and final judgment as it grants the relief sought by plaintiff against the defendant and as such is immediately appealable The June 21 2011 judgment which granted Williams motion for summary jud s nent granted him the relief that he prayed for in his motion for summary judgment in that it granYed him declaratory relie The judgment however did not grant Williams all of the relief that he prayed for in his original and supplemental petitions in that it did not grant his prayer for all costs and reasonable attorney fees and as such the judgment is not s final under LSA art 1915 Accordingly the June 21 2011 judgxnent is a C A partial summary judgment without the proper designation of finality required by LSA P C art 1915 as set forth in this CourYs September 19 2011 Rule to Show Cause B Order See Josenh v Ratcliff 2010 La App 1 Cir 3 63 So 2d 220 224 1342 11 25 However in considering the trial court September 22 2011 order in response to s this courYs show cause order decrees that the June 21 20ll judgment constitutes a full and final judgment as it grants the relief sought by plaintiff against the defendant and as such is immediately appealable while it does not reference LSA art 1915 or P C B 1915 I would nonetheless consider the language of the order as constituting the appropriate and proper certification of finality required by Article 1915 since it refers B to the June 21 2011 judgment as being a and final judgmenY and immediately full appealable Moreover based on a de novo review of the propriety of this certification see R J Messineer Inc v Rosenblum 2004 La 3 894 So 2d 1113 1122 I find 1664 OS 2 there is no just reason for delaying review of this partial summary judgment in that the issues raised in this appeal are closely aligned with the issues addressed by this court in the related writ applications that were referred to this panel Accordingly a review of the June 21 2011 partial suuunary judgment at this time would facilitate final resolufion of these issues in this case thereby fostering judicial economy Moreover regarding the relationship between the adjudicated and unadjudicated claims see Messin 894 So er 2d at 1122 the remaining issues of costs and attorney fees before the trial court aze s distinct from the issues presented in the present appeal such that a final determination may be made as to the issues presently before this court Accordingly I would recall the Rule to Show Cause Order and maintain IOS s appeal of the June 21 2011 partial summary judgment 11 On appeal IOS again asserts that the trial court erred in 1 ignoring a binding arbitration clause as to the non provisions in the compete Operating Agreement and 2 granting the summary judgment as to the renounced non provisions in the Employment Agreement where compete no justiciable controversy remained because of IOS waiver of all legal s claims related to the non provisions of that agreement compete Essentially IOS again avers that the trial court had no jurisdiction to decide claims arising under the Operating Agreement contending the arbitration clause therein required those matters to be submitted to an arbitration panel and further that the trial court lacked subject matter jurisdiction to decide claims relating to the non provision in the Employment Agreement compete where IOS by corporate resolution agreed not to enforce that provision in the Employment Agreement Notably there is no assignment of error challenging the merits of the trial court declarations in the June 21 2011 s partial summary judgment With regard to the portion of the June 21 2001 partial summary judgment declaring that Williams is not prevented or prohibited by the provisions of the Operating Agreement from engaging in certain business activities for the reasons set forth above in our disposition of writ application number 2011 CW 1240 I would affirm the judgment on appeal Although 6 not listed as an assignment of error IOS argues in its appellate brief that the trial court should have determined whether it had subject matter jurisdiction before it considered Williams smotion for summary judgment A judgment rendered by a court which has no jurisdiction over the subject matter of the action or proceeding is null P C LSA art 3 Gisclair v Louisiana Taac Commission 2009 La 0007 09 26 6 16 So 3d 1132 1133 n L However while the better practice may have been for the trial court to decide the issue of iYs continuing subject matter jurisdiction prior to ruling on Williams motion for summary judgment in disposition herein of IOS writ s s application in 20ll CW 1318 I find that IOS corporate resolution did not deprive the s trial court of subject matter jurisdiction over the claims related to the non compete agreement in the Employment Agreement anddenied in my view that the exception of thus lack of subject matter jurisdiction was properly 12 With regard to IOS second assignment of error wherein it contends s that the trial court erred in granting summary judgment as to the terms of the compete non provision of the Employment Agreement because the corporate resolution it passed rendered this claim moot for the reasons expressed in my analysis of writ number 2011 CW 1318 above I likewise find no merit to this argument Because the corporate resolution only releases Williams from any claims by IOS under the non in the compete Employment Agreement but does not release him from his obligations therein Williams was still bound by the obligations of the non compete agreement in addition to any fiduciary duties assumed through the Employment Agreement Accordingly a justiciable controversy remained and Williams was entitled to have the extent of those obligations judicially determined through his declaratory judgment action Moreover because IOS has not challenged the substance or merits of the trial court determination as to Williams obligations pursuant to the s s compete non clause in the Employment Agreement I note that issue is not before us I note however that the June 21 2011 judgment provides in part that Williams is not prevented or prohibited by the Employment Agreement from engaging in any other business that IOS was not engaged on January 8 2009 as defined by the four categories specifically listed in the non compete clause judgment be Emphasis added precise definite Louisiana courts require that a and certain Vanderbrook v Coachmen Industries Inc 2001 La App 1 Cir 5 818 So Zd 906 913 0809 02 10 Because these four categories are not specified within the judgment this portion of the judgment lacks specificity and is not precise definite and certain as required by the jurisprudence However the judgment clearly 13 recognizes that Williams business activities are limited only by those s activities in which IOS was engaged at the time the parties entered into the Employment Agreement and as stated above IOS has not challenged the substance of this ruling Accordingly 1 would amend the judgment to expressly state the four categories of business activities in which IOS was engaged at the time of confection of the Employment Agreement as set forth in the non provision therein See LSA art 2164 and compete P C Brister v Brister 2010 CU 2278 p 3 App l Cir 5 La 11 6 unpublished For these reasons I respectfully dissent 14
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