author: PAUL A. BONIN, Judge.

text:
    Ava Maria DEJOIE v. David GUIDRY.
    No. 2010-CA-1542.
    Court of Appeal of Louisiana, Fourth Circuit.
    July 13, 2011.

      Leslie A. Bonin, Leslie A. Bonin, LLC, New Orleans, LA, for Plaintiff/Appellee.
    S. Guy deLaup, Metairie, LA, for Defendant/Appellant.
    (Court composed of Judge TERRI F. LOVE, Judge MAX N. TOBIAS, JR., Judge PAUL A. BONIN).
   PAUL A. BONIN, Judge.

| |David Guidry, who is self-employed, appeals the judgment increasing his monthly child support payment from the previous amount of $1,000 stipulated in a consent judgment to the current award of $4,017. He complains that his former wife, Ava Dejoie, did not prove a material change in circumstances from the 2004 consent judgment to the filing of her 2007 rule to increase and the resulting 2010 judgment; for that reason he argues that the judgment should be vacated. He also complains that the trial judge made legal errors both in determining his adjusted gross income, which resulted in the combined adjusted gross income of the parties’ exceeding the child support guidelines, and in setting the amount of the basic child support obligation. For those reasons, he further argues, if we find that Ms. Dejoie has proven a material change in circumstances, we should substitute our own judgment for that of the trial judge, and make our own finding of fact as to his adjusted gross income and then set the amount of his obligation ourselves.

We summarize our decision on the primary issues presented to us. First, we find no legal error which interdicts the trial court’s findings. Second, because we li>find that the trial judge was not clearly wrong in finding that Mr. Guidry’s income had increased to such an extent that his circumstances had materially changed, we conclude that a modification of the 2004 consent judgment is appropriate. And third, because the combined monthly adjusted gross income of the parties exceeds the scheduled guidelines, which requires that the trial judge use her discretion in setting the amount to be awarded as child support to Ms. Dejoie, we find that the trial judge’s award is not excessive and that she did not abuse her discretion. Accordingly, we affirm the judgment. We explain our decision in the following Parts.

I

In this Part we first set out the history of this controversy and then describe some of the specific features of Mr. Guidry’s income.

A

Mr. Guidry and Ms. Dejoie are the parents of one son, their only child. Initially Ms. Dejoie commenced child support proceedings in Jefferson Parish. On September 9, 2004, in that proceeding the parties entered into a stipulated, or consent, judgment. That judgment recognized Ms. De-joie’s monthly gross income to be $3,852 and Mr. Guidry’s monthly adjusted gross income to be $10,053. Based upon their combined monthly adjusted gross income, and the scheduled child support guidelines then in effect, Mr. Guidry was condemned to pay $1,000 per month.

|3On August 20, 2007, Ms. Dejoie registered the child support judgment in Orleans Parish. See La. C.C.P. Art. 2786. At the same time, in order to obtain a modification of the consent judgment, she filed a rule to increase the child support. She also filed a rule for contempt and for past due child support arrearages. Because of delays occasioned by document production problems and the pending ar-rearages matter, the trial of the rule to increase extended over three days in three years. The trial court heard testimony from the parties and from two expert witnesses, both certified public accountants.

After permitting the parties post-trial submissions, the trial court rendered judgment on June 3, 2010.

In her extensive reasons for judgment, the trial judge found that Mr. Gui-dry’s monthly gross income at the time of trial was $47,494, which was adjusted to account for his monthly payment of $1,100 support for his other minor son. Ms. De-joie’s monthly income had increased to $6,000. The combined monthly adjusted gross income, the trial judge found, was $52,394. The trial judge concluded that the resulting differential of $38,542 per month of increased income constituted a material change in circumstances.

The parties’ combined monthly adjusted gross income exceeded the highest amount scheduled in the guidelines used by the trial judge. After a consideration 14of the expenses of the child and the lack of expenses of the father along with a formulaic extrapolation from the scheduled guidelines, the trial judge set the basic monthly child support at $4,633. The trial judge then apportioned each party’s share of the obligation, resulting in the cash portion of Mr. Guidry’s obligation increasing from $1,000 to $4,017 per month. See La. Civil Code Art. 227. The increase was retroactive to the date of the filing of the rule to increase. See La. R.S. 9:315.21 C. Mr. Guidry appeals the judgment.

B

Mr. Guidry is a self-employed business person. The principal source of income is his wholly-owned IRS Subchapter S Corporation, Guico Machine Works. He also wholly owns several other businesses, one of which owns a farm or a country home.

Mr. Guidry earns a salary from Guico and a salary with a bank-holding company. His salary from Guico constantly has been $80,000 annually. From time to time, Gui-co loans or advances money to Mr. Guidry; his record of repayment is unclear. He earns as a director an additional steady amount of $15,000 annually from a bank-related company. Sometimes he receives dividend income from the bank, but his bank-dividend income fluctuates, and his interest income is inconsequential.

Guico has at least one company credit card, which Mr. Guidry and other employees use. Mr. Guidry possesses no credit cards in his personal name. He |sadmits to personal charges on the company credit card. Mr. Guidry did not produce any credit card statements to substantiate the nature of the charges, which averaged on a monthly basis between $20,000 and $25,000. Moreover, he did not produce any documentation suggesting that he reimbursed his company for his personal charges. For the years in question, Mr. Guidry reduced his federal tax liability by claiming all Guico credit card charges as business expenses. Ms. Dejoie contends that he is not entitled to subtract any of the credit card charges because he has not shown them to be ordinary and necessary expenses. Ms. Dejoie points out that in the absence of the credit card billings and specific explanations, there is no basis to distinguish which specific items qualify as ordinary and necessary expenses and which do not.

Mr. Guidry owns no personal vehicles but has the use of company cars, such as a BMW. He, likewise, incurs no housing expenses, but resides on Guico’s premises in an apartment, at his other company’s country farmhouse, and at a girlfriend’s house.

The testimony and documentary evidence mostly addressed Mr. Guidry’s company’s performance from 2006 through the time of the last hearing date in 2010. The evidence demonstrated that its actual (not accounting) performance was consistently improving during those years, which was itself an improvement over its earlier performance, especially in 2004. A major issue which developed during the hearing was whether Mr. Guidry’s expensing of the company’s accelerated | f,depreciation to reduce his personal federal income taxes misrepresented his gross income for child support purposes.

With respect to depreciation as a business expense, Mr. Guidry initially had argued that he was entitled to a deduction for the accelerated depreciation allowable by the IRS. Anticipating, however, that the trial judge in this case would not allow accelerated depreciation as an expense, Mr. Guidry alternatively argued that the trial judge should deduct from the gross receipts of the business as an ordinary and necessary expense required to produce income an amount equal to his company’s non-accelerated depreciation of its assets. At the conclusion of the trial, with the trial judge’s authorization, Mr. Guidry recalculated Guico’s income using a non-accelerated method of depreciation. The trial judge considered this post-trial recalculation in her reasons for judgment.

Thus, Mr. Guidry suggested three different formulations for determining his income. The first determined his income on the basis of his salaries only. The second determined his income basing it on income from all sources, including Guico, but calculated income using accelerated depreciation. The third determined his income by using income from all sources and allowed the expensing of nonaccelerated depreciation only. We reference his third suggested formulation, which Mr. Guidry submitted post-trial, as his best-case scenario. See Part II-C-1, post.

II

|7In this Part we address the threshold issue: whether there has been a material change in Mr. Guidry’s circumstances to justify increasing his child support obligation to Ms. Dejoie. We review, in II-A the controlling law on material change of circumstances and the standard for our review of the trial judge’s determination, in II-B the controlling law on what constitutes a parent’s income and its application to Mr. Guidry’s income, and in II-C Mr. Guidry’s complaints about the trial judge’s findings of fact.

A

“An award of child support may be modified if the circumstances of the child or of either parent materially change and shall be terminated upon proof that it has become unnecessary.” La. Civil Code Art. 142. Ms. Dejoie bears the burden of proof on this issue. “An award for support shall not be modified unless the party seeking the modification shows a material change in circumstances of one of the parties between the time of the previous award and the time of the rule for modification of the award.” La. R.S. 9:311 A(l). “[A] parent seeking an increase should be required to demonstrate an improvement in the payor’s financial condition, or greater needs by the minor.” Bordenave v. Bordenave, 93-1183 (La.App. 4 Cir. 1/13/94), 631 So.2d 519, 520. The trial judge found that there was a material change in circumstances due to the dramatic increase in Mr. Guidry’s income. We review that finding under the well-known clearly wrong standard. State, Dept. of Social Services ex rel. D.F. v. L.T., Jr., 05-1965, p. 6 (La.7/6/06), 934 So.2d 687, 690 (“We also note that the standard of review in a child support case is manifest error.”)

B

1

The Lawmaker provides the sole definition of a parent’s “gross income” for the purpose of calculating the child support obligation. A parent’s “gross income” is not limited to salaries. Instead, “gross income” includes “income from any source,” such as salaries, dividends and interest. See La. R.S. 9:315 C(3)(a). Also, “gross income” includes significant in-kind payments from self-employment which reduce the parent’s personal living expenses as well as a parent’s closely held corporation’s gross receipts “minus ordinary and necessary expenses required to produce income”. La. R.S. 9:315 C(3).

li)Thus, in determining a parent’s gross income, the trial court clearly is not limited to a party’s salary or income reported on a tax return.

The court must also consider whether a parent receives in-kind payments. “Such payments include but are not limited to a company car, free housing, or reimbursed meals”. See LA. R.S. 9:315 C(3)(b). Mr. Guidry receives in-kind payments from Guico. He does not possess a personal automobile, but has free use of a number of company cars, including a luxury automobile. Also, he has no personally owned or rented residence. He has the use of a Guico-provided apartment as well as another company-owned farmhouse. These in-kind payments meet the statutory test for inclusion as income because they significantly reduce Mr. Guidry’s personal living expenses. Id. The value of these payments is quantifiable as income to Mr. Guidry.

The income to be attributed to a parent who owns a closely held corporation is the corporation’s “[g]ross receipts minus ordinary and necessary expenses required to produce income”. See La. R.S. 9:315 C(3)(c). The court, of course, is not bound by the controlling parent’s designation of which expenses are “ordinary and necessary,” even if made in federal tax returns. See Roberts v. Roberts, 95-1626 (La.App. 4 Cir. 6/5/96), 677 So.2d 1042; Hudnall v. Hudnall, 00-0330, p. 10 (La.App. 1 Cir. 5/11/01), 808 So.2d 641, 648; Baggett v. Baggett, 96-453, pp. 9-10 (La.App. 3 Cir. 4/23/97), 693 So.2d 264, 269; see also LA. R.S. 9:315 C(l)(c). If expenses are to be subtracted from gross receipts as “ordinary and necessary,” the party controlling the closely held corporation must bear that burden. See Scott v. Scott, 43,455 (La.App. 2 Cir. 8/13/08), 989 So.2d 290, 295 (proprietor/parent must demonstrate expense).

2

Thus, it is readily apparent that Mr. Guidry’s first contention that the trial judge should have restricted her findings regarding his current income to his two salaries is not supported by controlling law. While it is true that his salaries remained virtually unchanged from the time of the 2004 consent judgment until the filing of the rule to increase and through the trial, the trial judge must determine all sources of income to Mr. Guidry.

While we accept that Mr. Guidry established that his gross income as stipulated in the 2004 consent judgment represented his salaries at that time which had not changed by the time of the rule to increase, at trial he did not offer any proof whatsoever that in 2004 he had other sources of income which he had failed to disclose to either the Jefferson Parish judge or to Ms. Dejoie. If, as he alternatively suggests, his income has not really increased because in 2004 he did not report income from all sources, it is Ms. Dejoie, not he, who has been disadvantaged. More importantly for our purposes, however, such an argument undercuts his contention that no modification can be justified. If an earlier ^stipulated judgment was not given the proper consideration by the trial judge, it is error to rely upon the flawed judgment in denying a modification of child support. See Stogner v. Stogner, 98-3044 (La.7/7/99), 739 So.2d 762, 769.

In the absence of substantial evidence that the 2004 consent judgment was flawed either because of misrepresentation by Mr. Guidry or of improper application of the guidelines by the Jefferson Parish judge, we confine ourselves to the content of the 2004 consent judgment and presume that the district judge performed her duty under Stogner and approved the stipulated amounts based upon the guidelines using Mr. Guidry’s gross income, which at the time may have consisted of his salaries alone. That judgment, to which Mr. Gui-dry consented, memorialized that his monthly adjusted gross income was $10,053.

C

Once Mr. Guidry’s contention that only his income from salaries should be considered for the purposes of determining whether a material change of circumstances has occurred is jettisoned, his best-case scenario for his monthly gross income shows an increase to $26,716.

1

Mr. Guidry’s best-case scenario for his annual gross income accepts his reconstructed calculation for Guico’s gross receipts, uncritically and fully deducting non-accelerated depreciation and all credit card charges. Mr. Guidry’s gross income, according to Mr. Guidry, using Guico’s gross receipts less ordinary 11?and necessary expenses including straight-line depreciation and credit card expense and all his other sources of income (such as his salaries) would be $320,588 annually, for a monthly gross income of $26,716.

Mr. Guidry is not entitled to a reduction of Guico’s gross receipts by expensing accelerated depreciation of its assets. Regarding acceleration, the statute itself expressly excludes from “ordinary and necessary expenses” amounts “allowable by the Internal Revenue Service for the accelerated component of depreciation expenses”. La. R.S. 9:315 C(3)(c) (emphasis added); see also Riggs v. LaJaunie, 98-304, pp. 4-5 (La.App. 3 Cir. 10/7/98), 720 So.2d 114, 117 (proprietor/parent bears burden that his earnings are calculated without the use of an accelerated component of acceleration). The trial judge clearly and correctly rejected any accelerated component of depreciation as an expense to reduce Guico’s gross receipts.

But “by implication, a non-accelerated straight-line depreciation expense of a business asset required to produce income may be an ordinary and necessary expense.” Thomey v. Thomey, 33,000, p. 3 (La.App. 2 Cir. 4/7/00), 756 So.2d 698, 701 (emphasis added). Although Mr. Guidry is correct in his argument that the trial judge did not fully accept his reconstructed allowance for non-accelerated depreciation, we are not persuaded that her refusal to debit the full amount has any appreciable effect on determining whether there has been a material change in his circumstances.

^J^Similarly, Mr. Guidry complains that the trial judge imputed to him additional estimated income of $10,000 per month for his unreimbursed company credit card charges. Typical monthly charges for the company’s single credit card were in the range of $20,000 to $25,000. Mr. Guidry testified that several employees, in addition to himself, also used the credit card. He explained that often large opportunity-purchases were made with the card. He acknowledged, however, that he used the card for entertainment and for personal expenses. He described a single instance of repaying the company for such a personal expense, one involving his purchase of a shotgun. Notably, despite discovery and informal requests, Mr. Guidry did not produce any credit card statements. Guico’s CPA explained at trial that, in the preparation of the company’s federal tax returns, the accounting firm does not review the credit card statements but accepts Mr. Guidry’s representation that all charges are authorized deductible business expenses. The trial judge decided that, on average, Mr. Guidry enjoyed the personal use of the credit card in the amount of $10,000 a month and added that amount back to the gross income.

But, for the purposes of accepting ar-guendo Mr. Guidry’s best-case scenario, we lay that imputed income to the side. The inclusion or exclusion of such imputed income has no appreciable effect on our determination of whether the trial judge was clearly wrong in finding a material improvement in Mr. Guidry’s circumstances.

114Under Mr. Guidry’s best-case scenario, his monthly adjusted gross income more than doubled, indeed nearly tripled, from 2004 until the time of the hearing. We conclude that the trial judge was not clearly wrong in finding that there was a material change in his circumstances to justify an increase in his child support obligation.

2

We now address Mr. Guidry’s argument that the manner in which the trial judge determined his gross monthly income constitutes legal error which obliges us to set aside the finding and make a de novo determination of his monthly adjusted gross income. The Louisiana Supreme Court has instructed intermediate appellate courts to apply the manifest error standard of review unless “one or more trial court legal errors interdict the fact-finding process.” Evans v. Lungrin, 97-0541, 97-0577, p. 6 (La.2/6/98), 708 So.2d 731, 735. “A legal error occurs when the trial court applies incorrect principles of law and such errors are prejudicial.” Id., citing Lasha v. Olin Corp., 625 So.2d 1002, 1006 (La.1993). But not every error is prejudicial. “Legal errors are prejudicial when they materially affect the outcome and deprive a party of substantial rights.” Id. “When such a prejudicial error ... skews the trial court’s finding of a material issue of fact and causes it to pretermit other issues, the appellate court is required, if it can, to render judgment on the record by applying the correct law and determining the essential material facts de novo.” Id.

The trial judge determined Mr. Guidry’s monthly adjusted gross income to be $47,494. She arrived at this figure by averaging the parties’ conflicting submissions. The CPA who investigated Mr. Guidry’s finances at Ms. Dejoie’s 11firequest restated Mr. Guidry’s gross adjusted income for three years, 2006-2008. Mr. Gui-dry countered that the calculations of the restatement not only excluded the accelerated depreciation expense lawfully claimed for IRS purposes, but also failed to factor into the restatement the so-called straight-line depreciation. Post-trial, with permission of the court, Mr. Guidry supplied his own recalculation of Guico’s income by deducting as an expense the non-accelerated depreciation for each of the three years.

With respect to this specific component of the calculation, the trial judge did not choose to accept one calculation and reject the other. Rather the trial judge, as she characterized it, “reconciled” the conflicting calculations. Mr. Guidry, for his part, characterizes the trial judge’s finding as an objectionable Solomonic “splitting the baby.” The trial judge averaged each party’s submission of Guico’s income figures for the three years. Then the trial judge averaged the two resulting averages and made a finding of fact that Mr. Guidry’s average income for the three-year period was $579,267. The resulting average monthly income amount would be $37,493.

While such explicit mathematical averaging is not usually desirable, we note that the trial judge’s finding was within the range of reasonable alternatives, and as the fact-finder, she was not required to accept the evidence of one party and its expert to the exclusion of the other party and its expert. See Lasyone v. Kansas City Southern R.R., 00-2628, p. 13 (La.4/3/01), 786 So.2d 682, 693; Katner v. Katner, 09-0974, p. 6 (La.App. 4 Cir. 12/23/09), 28 So.3d 566, 572.

But, more to the point, the trial judge’s calculation does not constitute “legal error” in the contemplation of Evans v. Lungrin, which would require us to make a de novo finding. The material issue, which we earlier described as the threshold |1fiissue, is whether there has been a material change in Mr. Guidry’s circumstances. The trial judge’s method did not affect a substantial right of Mr. Guidry. As we earlier observed, even under Mr. Guidry’s best-case scenario Ms. Dejoie is entitled to an increase in child support payments. The calculation method did not cause the trial judge to pretermit any other issue and it did not interdict her finding of a material change of circumstances. Therefore, we reject Mr. Guidry’s request that we make a de novo determination of whether there has been a material change because the trial judge’s finding is not clearly wrong and is reasonable.

Ill

In this Part we address the dis-positive issue: whether the amount of the child support award is excessive. Using either the trial court’s finding of the parties’ combined monthly adjusted gross income or Mr. Guidry’s best-case scenario for the parties’ combined income, we note that their combined income is higher than the highest scheduled amount on the guidelines. Thus, the trial judge was required to use her discretion in setting an amount of the obligation. “If the combined adjusted gross income of the parties exceeds the highest level specified in the schedule contained in R.S. 9:315.19, the court ... shall use its discretion in setting the amount of the basic child support obligation ... but in no event shall it be less than the highest amount set forth in the schedule.” La. R.S. 9:315.13 B(l).

We review the setting of the obligation under the abuse of discretion standard. Id. “[T]he trial court has discretion in setting the amount of child support when the combined adjusted gross income of the parties exceeds the highest figure provided in the schedule, and its judgment in such matters will not be disturbed in the absence of a showing of an abuse of that discretion.” Rosenbloom v. Rosenbloom, 94-1762, p. 4 (La.App. 4 Cir. 4/26/95), 654 So.2d 877, 879.

117Here, again, Mr. Guidry urges us to find legal error and make a de novo determination of the basic child support obligation. He argues that the trial judge did not set the basic child support obligation by using her discretion. Instead, she im-permissibly designed a formula to factor a multiple of the highest scheduled income to mathematically extrapolate to a proportionate obligation. The trial judge, he argues, determined that Mr. Guidry’s income — as she determined it to be — was 1.75 times more than the $30,000 highest scheduled amount, and she multiplied the highest scheduled obligation amount to ascertain the basic child support obligation in this matter. Such mechanical extrapolation, he contends, is prohibited.

In Rosenbloom the district court, using a mathematical formula which it designed, determined that the differential between the highest scheduled amount and the parties’ combined income was twelve percent; then the district court used that twelve-percent factor to ascertain the amount of the obligation. Rosenbloom, pp. 5-6, 654 So.2d at 880. Because the district judge in that case applied the flat percentage “without concern and discretion by the court in balancing the needs and lifestyle of the child,” we found the use of such a mathematical extrapolation to be “clearly erroneous.” Id.

While it is true that the trial judge did do something very similar to that which was done by the district judge in Rosen-bloom, we discern one important distinguishing factor. In our case, the trial judge explicitly considered and discussed the needs of the child — a factor absent in Rosenbloom. Thus, the trial judge did engage in discretionary fact-finding along with the disfavored formulaic extrapolation.

118But, as we stated in the preceding Part II-C-2, ante, we will make a de novo determination of a fact only when there has been prejudice to a substantial right of a party. We detect no such prejudice in the amount which the trial judge decided as the basic child support obligation.

Mr. Guidry receives more than $6,000 monthly in salary income alone. Other than his child support payment for the benefit of his other minor son, which amount has been considered in adjusting his monthly gross income, Mr. Guidry has virtually no other out-of-pocket expenses. He has no housing expense. He has no automobile expense. He dines and entertains himself and others on the company credit card; he does not reimburse the company. If all of his monthly salary were absorbed by his child support obligation, Mr. Guidry would still have more than $20,000 per month in additional income for himself — under his best-case scenario. Undoubtedly as a result of his hard work, Mr. Guidry enjoys a comfortable lifestyle, which he can deservedly well afford.

This comfortable lifestyle should be extended to young Guidry who should not be disadvantaged in his lifestyle because of his parents’ divorce and his living primarily with his mother, Ms. De-joie. “Children are entitled to the same standard of living that they would enjoy if they lived with their father if their father’s financial circumstances are sufficient to permit this.” Bullock v. Bullock, 98-0268, p. 4 (La.App. 4 Cir. 8/19/98), 719 So.2d 118, 115. Therefore, “the circumstances of the parents and the child’s best interest are determinative considerations, and the parents’ ability to pay and the lifestyle that the child otherwise would enjoy if the 1^parents had not separated are important considerations.” Langley v. Langley, 07-0754, p. 7 (La.App. 4 Cir. 3/26/08), 982 So.2d 881, 887; Vaccari v. Vaccari, 10-2016, p. 4 (La.12/10/10), 50 So.3d 139, 142. See also La. Civil Code Art. 141 and La. R.S. 9:315 A.

The abuse-of-discretion standard of review is highly deferential to the trial judge’s determination. In other contexts, the Louisiana Supreme Court has refused to disturb an award unless it is “so gross as to be contrary to right reason.” Youn v. Maritime Overseas Corp., 623 So.2d 1257, 1261 (La.1993). We have followed the Supreme Court’s lead and observed in a different context that we will not disturb a fact-finder’s discretion unless the award “shocks the conscience.” See, e.g., Scott v. American Tobacco Co., Inc., 09-0461, p. 16 (La.App. 4 Cir. 4/23/10), 36 So.3d 1046, 1056, writ denied, 10-1358, 10-1361 (La.9/3/10), 44 So.3d 686, 44 So.3d 707, cert. den. sub nom. Philip Morris USA, Inc. v. Jackson, 564 U.S. -, 131 S.Ct. 3057, 180 L.Ed.2d 886 (2011).

With all of these considerations in mind, we are unable to find that the trial judge abused her discretion in finding the basic child support obligation to be $4,633 and apportioning 89% of that amount to Mr. Guidry. Considering Mr. Guidry’s income and the lack of personal expenses to support his lifestyle, his child support obligation of $4,017 is surely not contrary to right reason or shocking to the conscience. Thus, we conclude that the trial judge did not abuse her discretion and that the child support award is not excessive.

|2(1DECREE

The judgment of June 3, 2010, which modified the consent judgment of September 9, 2004, increasing the child support payments due by David Guidry to Ava Dejoie for the support of their minor son, is affirmed, retroactive to date of the filing of the rule to increase. See La. R.S. 9:315.21 C. All costs of the appeal are taxed to Mr. Guidry. La. C.C.P. Art. 2164.

AFFIRMED

      . The judgment also increases his share of certain identified expenses from 72% to 89%.

      . Mr. Guidry has another minor son, whom he financially supports.

      . His monthly child support obligation also included a pro rata sharing of itemized expenses of the child.

      .The rule for arrearages and contempt was resolved in the district court and is not involved in this appeal.

      .The parties do not object or complain that the trial judge used a three-year income average. Considering Mr. Guidry’s self-employment status and the protracted trial of the rule to increase, we agree that in this case the averaging of three consecutive annual incomes is reasonable approach and we use the same approach. See, e.g., Janney v. Janney, 05-0507, p. 7 (La.App. 1 Cir. 7/26/06), 943 So.2d 396, 401.

      . The trial judge referenced the 2008 amendments, but the rule to increase was filed when the 2001 version was applicable. Under either version, however, the parties' combined monthly adjusted gross income exceeded the scheduled guidelines.

      . Ms. Dejoie has not appealed or answered the appeal. See La C.C.P. Art. 2121 and 2133 A.

      . Mr. Guidry claimed as an expense the financial support he provides his girlfriend for her mortgage payments and utility bills. These totaled about $1,500 monthly.

      . This included GoZone accelerated depreciation. See IRS Publication 4492.

      .There are multiple forms of non-accelerated depreciation, the most common of which is straight line depreciation. Often, "straight line” depreciation is used as shorthand for non-accelerated depreciation.

      . La. R.S. 9:315 C(3) reads:
      (3) "Gross income" means:
      (a) The income from any source, including but not limited to salaries, wages, commissions, bonuses, dividends, severance pay, pensions, interest, trust income, recurring monetary gifts, annuities, capital gains, social security benefits, workers' compensation benefits, basic and variable allowances for housing and subsistence from military pay and benefits, unemployment insurance benefits, disaster unemployment assistance received from the United States Department of Labor, disability insurance benefits, and spousal support received from a preexisting spousal support obligation;
      (b) Expense reimbursement or in-kind payments received by a parent in the course of employment, self-employment, or operation of a business, if the reimbursements or payments are significant and reduce the parent’s personal living expenses. Such payments include but are not limited to a company car, free housing, or reimbursed meals; and
      (c) Gross receipts minus ordinary and necessary expenses required to produce income, for purposes of income from self-employment, rent, royalties, proprietorship of a business, or joint ownership or a partnership or closely held corporation. "Ordinary and necessary expenses” shall not include amounts allowable by the Internal Revenue Service for the accelerated component of depreciation expenses or investment tax credits or any other business expenses determined by the court to be inappropriate for determining gross income for purposes of calculating child support.
      (d)As used herein, "gross income” does not include:
      (i) Child support received, or benefits received from public assistance programs, including Family Independence Temporary Assistance Plan, supplemental security income, food stamps, and general assistance.
      (ii) Per diem allowances which are not subject to federal income taxation under the provisions of the Internal Revenue Code.
      (iii) Extraordinary overtime including but not limited to income attributed to seasonal work regardless of its percentage of gross income when, in the court's discretion, the inclusion thereof would be inequitable to a party.
      (iv) Any monetary gift to the domiciliary party when the objective of the gift is to supplement irregular child support payments from the nondomiciliary party.
      (v) Any disaster assistance benefits received from the Federal Emergency Management Agency through its Individuals and Households Program or from any other nonprofit organization qualified as a tax-exempt organization under Section 501(c) of the Internal Revenue Code of 1954, as amended.

      . Mr. Guidry testified that Guico was having difficulties in 2004.

      . His counsel explained at oral argument that the company does not receive a paper statement, only online statements.


source: Caselaw Access Project

author: LOLLEY, J.

license: Public Domain

text:
    Mark E. PEROT, Plaintiff-Appellee v. Yulonda PEROT, Defendant-Appellant.
    No. 46,431-CA.
    Court of Appeal of Louisiana, Second Circuit.
    Aug. 10, 2011.
    Rehearing Denied Sept. 15, 2011.

      Kammer & Huckabay, Shreveport, LA, by Pugh T. Huckabay, III, for Appellant.
    Chris L. Bowman, Jonesboro, LA, for Appellee.
    Before STEWART, MOORE and LOLLEY, JJ.
   LOLLEY, J.

|,Yulonda Perot appeals the judgment by the Second Judicial District Court, Parish of Claiborne, State of Louisiana, in favor of Mark E. Perot denying Yulonda’s Petition to Rescind the Extrajudicial Partition of Community Property. For the following reasons, we reverse the judgment of the trial court and remand the matter to the trial court for the determination of attorney fees to Yulonda Perot.

Facts

After approximately 22 years of marriage to Yulonda, Mark filed a petition for divorce on August 9, 2006. The petition was filed on Mark’s behalf by Danny New-ell, an attorney and close personal friend of Mark’s, and Yulonda had no knowledge that the petition had been filed. That evening at Mark’s insistence, he and Yu-londa went to Newell’s office to work out a settlement of the community property. The parties signed a partition of community property agreement (the “community property agreement”) and a corresponding quitclaim deed for a majority of the community immovable property. Yulonda claims that both Mark and Newell told her that Newell was not representing either party and that the agreement was a fair division of the property. The parties apparently revisited Newell’s office a couple of days later to re-sign the same agreement in the presence of two witnesses (the original agreement signed and dated August 9 actually bears two signatures for each of the parties). The community property agreement was filed in the record on August 11, 2010. Also on that day, a verifying affidavit by Mark was filed into the | grecord, in which he verified that the allegations of the petition were true and correct.

Shortly thereafter, Yulonda filed suit to have the community property agreement rescinded on the grounds of error, fraud, duress, and lesion. After a three-day trial on the matter, the trial court rendered a judgment in favor of Mark, denying Yulon-da’s petition to rescind. Yulonda filed the instant appeal.

Law and Discussion

On appeal, Yulonda argues that the community property agreement should be rescinded for several reasons, primarily lesion and fraud. Considering the facts of the case, particularly the disturbing actions of Mark and his original attorney in the divorce proceeding, we conclude that the trial court applied the incorrect burden of proof regarding the fraud claim and erred in not rescinding the community property agreement for fraud.

An appellate court may not set aside a trial court’s finding of fact in the absence of manifest error or unless it is clearly wrong, and where two permissible views of the evidence exist, the fact finder’s choice between them cannot be manifestly erroneous or clearly wrong. Cole v. State Department of Public Safety and Corrections, 2001-2123 (La.09/04/02), 825 So.2d 1134; Stobart v. State through Dept. of Transp. and Development, 617 So.2d 880 (La.1993). To reverse a fact finder’s determination, the appellate court must find from the record that a reasonable factual basis does not exist for the finding of the trial court and that the record establishes that the finding is clearly wrong. Stobart, supra. |sEven though an appellate court may feel its own evaluations and inferences are more reasonable than the fact finder’s, reasonable evaluations of credibility and reasonable inferences of fact should not be disturbed upon review where conflict exists in the testimony. Cole, supra; Rosell v. ESCO, 549 So.2d 840 (La.1989).

A contract is formed by the consent of the parties. La. C.C. art. 1927. However, consent may be vitiated by error, fraud, or duress. La. C.C. art. 1948. Fraud is a misrepresentation or a suppression of the truth made with the intention either to obtain an unjust advantage for one party or to cause a loss or inconvenience to the other. La. C.C. art. 1953; Shelton v. Standard/700 Associates, 2001-0587 (La.10/16/01), 798 So.2d 60. Fraud may also result from silence or inaction. La. C.C. art. 1953. Error induced by fraud need not concern the cause of the obligation to vitiate consent, but it must concern a circumstance that has substantially influenced that consent. La. C.C. art. 1955. Fraud does not vitiate consent when the party against whom the fraud was directed could have ascertained the truth without difficulty, inconvenience, or special skill. However, this exception does not apply when a relation of confidence has reasonably induced a party to rely on the other’s assertions or representations. La. C.C. art. 1954. Fraud need only be proven by a preponderance of the evidence and may be established by circumstantial evidence. La. C.C. art. 1957.

Initially, the trial court in this case erred by applying the improper burden of proof to Yulonda regarding her fraud claim against Mark. The trial court observed in its reasons for judgment that Yulonda sought | rescission of the community property agreement on the basis of error, fraud, duress and/or lesion. However, the trial court stated that Yulonda had the burden of proving her claims by clear and convincing evidence, launching into a somewhat detailed discussion of the evidence regarding the valuation of the community property involved. The trial court failed to consider the claim for rescission by the individual alleged causes. Had the trial court considered Yulonda’s items of claim of fraud individually, the applicable burden of proof would have been the more relaxed burden of a preponderance of the evidence. See La. C.C. art. 1957.

In this case, Yulonda’s consent to the community property agreement was obviously vitiated by fraud, said fraud, which was perpetrated by Mark by his misrepresentation or suppression of the truth made with the intention to obtain an unjust advantage. The fraud is evident from the record, and the trial court clearly erred in finding otherwise. Whereas Mark testified that he could not remember exactly how the community property agreement came into existence, Yulonda testified that she and Mark arrived at Newell’s office after business hours on the evening of August 9, 2006. She explained that the couple knew Newell well-he was a close family friend. According to Yulonda, Newell had some paperwork already drawn up concerning the settlement of the community property when they arrived at his office; however, Yulonda testified that she had no knowledge that Mark had already instituted divorce proceedings against her.

Among other provisions, the three-page community property agreement stated the following:

|s8. The parties further acknowledge that each has been advised to seek the advice of counsel and relieve the undersigned notary/attorney from any and all liability, it having been explained that he is representing neither partg and will not be involved in angtliing other than reducing the parties [sic] agreement to writing in legal form. (Emphasis added).

Yulonda testified that Newell said he represented neither party, and this provision in the agreement, drawn up by Newell, supports her testimony. Unbeknownst to Yulonda, Newell was indeed representing Mar — he had filed a petition for divorce on Mark’s behalf that very day. Moreover, that petition contained allegations referring to “the parties’ ” (i.e., Mark and Yulonda) community property settlement agreement “to be filed.” Specifically, the following allegation was made in the petition:

The parties have settled community property pursuant to the Community Property Settlement Agreement to be filed. As part of this property settlement, Defendant, YULONDA PEROT, will received $250.00, per month as spousal support which will terminate upon the date a divorce judgment is obtained. Additionally, as part of the property settlement and any obligation to pay permanent alimony, Plaintiff, MARK E. PEROT, has agreed to maintain health insurance on YULONDA PEROT for one year from the date of this filing and to pay directly to Bossier Parish Community College, tuition for a period of one year, or until YULONDA PEROT is no longer enrolled, whichever is sooner.

For an act to constitute fraud, it must be calculated to produce a misleading effect. McCoy v. City of Monroe, 32,521 (La.App.2d Cir.12/08/99), 747 So.2d 1284, writ denied, 2000-1280 (La.2001), 788 So.2d 441. Here, there is direct evidence that Mark misrepresented the facts to and suppressed information from Yulonda, with the effect of misleading her. Clearly, as represented to the trial court in Mark’s petition for divorce, Mark and Newell had already anticipated the terms of the community | ^property agreement before Yu-londa got to Newell’s office that evening. The overt misrepresentations made to Yu-londa later that day regarding Newell’s involvement in the matter and his legal representation of Mark had a direct bearing on her consideration to enter into an agreement which would forever relinquish her right to any community property owned by her and Mark. It is apparent that Mark did not want Yulonda to know that he was represented by Newell already, and the fact that Newell was actually representing Mark in his divorce undoubtedly gave him an unfair advantage in the negotiation and completion of the community property agreement. See Skannal v. Bamburg, 44,820 (La.App.2d Cir.01/27/10), 33 So.3d 227, writ denied, 2010-0707 (La.05/28/10), 36 So.3d 254, where this court determined that the “material inducement” led that plaintiff to enter into a “deal ... so peculiar and unfavorable to [the plaintiff] that it could not have occurred in the absence of fraud.” Id. at 238.

Furthermore, although it could be argued that Yulonda may have been able to later ascertain the truth of Newell’s legal relationship with Mark without difficulty, Mark’s urgency and coercion, coupled with the deceitful assurances and misrepresentation regarding Newell’s role in the agreement, made it impossible for her to ascertain the truth of the matter at the time that she was called to act. Moreover, even though she and Mark were on the brink of divorce, she apparently trusted him and Newell, whom she characterized as a “family friend.” Clearly, a relationship of confidence existed that reasonably induced Yulonda to rely on Mark’s and Newell’s assertions and representations.

17Here, the dual fraud perpetrated by Mark and his attorney Newell is patent on the record. In failing to consider the activity and circumstances surrounding the execution of the community property agreement, which was highly evident by the record before it, the trial court erred in not finding that Yulonda proved by a preponderance of the evidence that Mark’s (and arguably his attorney’s) actions constituted fraud sufficient to rescind the community property agreement.

Additionally, in Yulonda’s petition to rescind the community property agreement, she alleged entitlement to attorney fees pursuant to La. C.C. art. 1958, which states: “The party against whom rescission is granted because of fraud is liable for damages and attorney fees.” Once fraud is established, the party responsible for the fraudulent activity is liable for damages and attorney fees under art. 1958. Osborne v. McKenzie, 48,658 (La.App.2d Cir.10/22/08), 998 So.2d 187, writ denied, 2008-2555 (La.01/09/09), 998 So.2d 726. Here, there has been no showing made regarding the amount of attorney fees incurred by Yulonda in seeking the rescission of the agreement for fraud; therefore, on this limited issue, we remand the matter to the trial court to take evidence considering the attorney fees and to make an award of such to Yulonda pursuant to La. C.C. art. 1958.

Finally, for the reasons stated herein, it is unnecessary to consider the value of the actual community property made the subject of the community property agreement, as any consideration of the legionary nature of the agreement is pretermitted by the conclusion that Mark fraudulently induced Yulonda to enter into the agreement in the first place.

| ^Conclusion

For the foregoing reasons, the trial court’s judgment in favor of Mark Perot is reversed and the community property settlement agreement dated August 9, 2006, is rescinded. All costs of this appeal are assessed to Mark Perot. The matter is remanded to the trial court for the specific issue of determining the attorney ■ fee award to Yulonda Perot pursuant to La. C.C. art. 1558.

REVERSED AND REMANDED FOR FURTHER PROCEEDINGS.

APPLICATION FOR REHEARING

Before STEWART, GASKINS, DREW, MOORE and LOLLEY, JJ.

Rehearing denied.

DREW, J., would grant rehearing.

      . The rescission of the community property agreement has the effect of rescinding the corresponding quit claim deed, because the deed was entered into pursuant to the terms of the agreement.


author: PEATROSS, J.

text:
    Steven BOGUES, et al., Plaintiffs-Appellees v. LOUISIANA ENERGY CONSULTANTS, INC. and J & K Petroleum, L.L.C., Defendants-Appellants.
    No. 46,434-CA.
    Court of Appeal of Louisiana, Second Circuit.
    Aug. 10, 2011.

      McMichael, Medlin, D’Anna, Wedge-worth & Lafargue, L.L.C., Shreveport, LA, by James C. McMichael, Jr., for Appellant, Louisiana Energy Consultants, Inc.
    Bodenheimer, Jones & Szwak, LLC, Shreveport, LA, by David A. Szwak, for Appellees.
    George W. Thornell, Adela C. Nieto, Pro Se.
    Kevin J. Severson, Covington, LA, for J & K Petroleum, LLC.
    Before BROWN, PEATROSS & DREW, JJ.
   PEATROSS, J.

|,In this suit for declaratory judgment, Defendant/Plaintiff in Reconvention Louisiana Energy Consultants, Inc. (“LEC”), appeals the judgment of the trial court sustaining Plaintiffs’, Steven Bogues, et al, (“Plaintiffs/lessors”) Exceptions of No Cause of Action and Vagueness and dismissing LEC’s Reconventional Demand. For the reasons stated herein, we affirm.

FACTS

Plaintiffs are the lessors of mineral interests in an aggregate of 68 acres located in DeSoto Parish, Louisiana. There are 22 leases involved in this matter and LEC is the successor-in-interest to the original lessee by way of assignment. On February 20, 2009, Plaintiffs/lessors filed suit seeking a declaratory judgment terminating the leases and for damages. The suit claimed that, while the lessee had drilled and produced from a well on the property starting in 1997, it had failed to timely pay royalties and operate the leasehold as a reasonable and prudent operator. The suit also alleged that the lessee had breached an implied covenant of reasonable development by failing to conduct further exploration and was currently in the process of trying to farm out the deep rights under the leases by negotiating with Chesapeake Operating, Inc., and XTO Energy, Inc. Plaintiffs/lessors sought damages for unpaid revenues derived from production and a judgment declaring the leases terminated.

|2LEC filed aclaim in reconvention seeking damages under La. C.C. art. 2315 for intentional tort and for violations of the Louisiana Unfair Trade Practices Act (“LUTPA”), La. R.S. 51:1401, et seq. Generally, LEC alleged that Plaintiffsfiessors had engaged in a campaign to discredit LEC in its negotiations with third parties on farm-out agreements despite the fact that LEC had paid all royalties due and otherwise maintained its obligations under the leases. LEC alleged that this was done so that Plaintiffsfiessors could seek cancellation of the leases and deal directly with the third parties for development of the deep rights on more favorable terms to Plaintiffsfiessors. In order to bring its claim under the purview of LUTPA, LEC contended that Plaintiffsfiessors were “potential business competitors” of LEC arising from Plaintiffsfiessors’ efforts to cancel the leases so that they could further develop the property themselves.

Plaintiffsfiessors responded to the Re-conventional Demand by filing Exceptions of Vagueness, No Right of Action and No Cause of Action. Plaintiffsfiessors alleged that LEC has no right of action and that its “loosely alleged” claims failed to state a cause of action in defamation or tort and failed to state a cause of action under LUTPA. The exceptions were sustained by the trial judge and LEC was given 30 days to amend its Reconventional Demand. LEC then filed an Amended Reconven-tional Demand and Plaintiffsfiessors reurged their exceptions, arguing that LEC simply restated the allegations of the original Reconventional Demand.

The trial judge again sustained the exception of no cause of action and vagueness and did not rule on the exception of no right of action. |sFollowing a determination by this court that the judgment was final for purposes of appeal, the appeal was allowed to proceed.

DISCUSSION

A “cause of action,” when used in the context of the peremptory exception of no cause of action, refers to the operative facts that give rise to the plaintiff’s right to judicially assert the action against the defendant. White v. St. Elizabeth B.C. Board of Directors, 45,213 (La.App.2d Cir.6/2/10), 37 So.3d 1139. The purpose of the exception of no cause of action is not to determine whether the plaintiff will prevail at trial, but is to ascertain if a cause of action exists. “We The People” Paralegal Services, L.L.C. v. Watley, 33,480 (La.App.2d Cir.8/25/00), 766 So.2d 744. The peremptory exception of no cause of action tests the legal sufficiency of the petition by determining whether the law affords a remedy on the facts alleged in the petition. Gipson v. Fortune, 45,021 (La.App.2d Cir.1/27/10), 30 So.3d 1076, writ denied, 10-0432 (La.4/30/10), 34 So.3d 298. The exception is triable on the face of the petition; and, for the purpose of determining the issues raised by the exception, the well-pleaded facts in the petition must be accepted as true. Fink v. Bryant, 01-0987 (La.11/28/01), 801 So.2d 346.

The burden of demonstrating that the petition states no cause of action is upon the mover. Scheffler v. Adams and Reese, LLP, 06-1774 (La.2/22/07), 950 So.2d 641; Wright v. Louisiana Power & Light, 06-1181 (La.3/9/07), 951 So.2d 1058. In reviewing rulings on exceptions of no cause of action, courts may consider exhibits attached to the petition in determining 14whether the law extends a remedy to the plaintiff under the factual allegations of the petition. Kuebler v. Martin, 578 So.2d 113 (La.1991); Creamer Brothers, Inc. v. Hicks, 39,799 (La.App.2d Cir.6/29/05), 907 So.2d 880.

An appellate court’s review of a trial court’s ruling sustaining an exception of no cause of action is de novo because the exception raises a question of law and the trial court’s decision is based only on the sufficiency of the petition. Fink, supra. The essential question is whether, in the light most favorable to plaintiff and with every doubt resolved in plaintiffs favor, the petition states any valid cause of action for relief. Wright, supra. When the grounds upon which an exception of no cause of action is based may be removed by amendment of the petition, the judgment sustaining the exception must order an amendment within a specified delay. “We The People” Paralegal Services, L.L.C., supra.

In the case sub judice, LEC has asserted claims of intentional tort under La. C.C. art. 2315 and violations of LUTPA. As previously stated, following the first ruling of the trial judge sustaining the exceptions, LEC was afforded an opportunity to amend its claims in reconvention. We have conducted a de novo review of LEC’s Amended Reconventional Demand and concur with the trial judge that LEC has failed to state a cause of action under either theory.

| -JLUTPA

Unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce are prohibited by law. La. R.S. 51:1405(A). La. R.S. 51:1409 provides, in pertinent part:

A. Any person who suffers any ascertainable loss of money or movable property, corporeal or incorporeal, as a result of the use or employment by another person of an unfair or deceptive method, act, or practice declared unlawful by R.S. 51:1405, may bring an action individually but not in a representative capacity to recover actual damages. If the court finds the unfair or deceptive method, act, or practice was knowingly used, after being put on notice by the attorney general, the court shall award three times the actual damages sustained. In the event that damages are awarded under this Section, the court shall award to the person bringing such action reasonable attorney fees and costs. Upon a finding by the court that an action under this Section was groundless and brought in bad faith or for purposes of harassment, the court may award to the defendant reasonable attorney fees and costs.

The definition portion of LUTPA is found in La. R.S. 51:1402, which provides, in pertinent part:

(1) “Consumer” means any person who uses, purchases, or leases goods or services.
(3) “Consumer transaction” means any transaction involving trade or commerce to a natural person, the subject of which transaction is primarily intended for personal, family, or household use.
* * *
(8) “Person” means a natural person, corporation, trust, partnership, incorporated or unincorporated association, and any other legal entity.
(9) “Trade” or “commerce” means the advertising, offering for sale, sale, or distribution of any services and any property, corporeal or incorporeal, immovable or movable, and any other article, commodity, or thing of value wherever situated, andJjjincludes any trade or commerce directly or indirectly affecting the people of the state.

As a threshold matter, recall that the trial judge did not sustain Plaintiffs/lessors’ exception of no right of action as to the LUTPA claim. The supreme court has recently interpreted and explained the right of action, or standing, to recover for violations of LUTPA in Cheramie Services, Inc. v. Shell Deepwater Production, Inc., 09-1633 (La.4/23/10), 35 So.3d 1053. The supreme court recognized and held that section 1405(A) grants a right of action to “[a]ny person who suffers any ascertainable loss” from a violation of this prohibition.

The parties in the instant case presented argument to the trial court and to this court concerning Plaintiffs/lessors’ alleged status as potential business competitors of LEC and the bearing that Plaintiffsfies-sors’ status has on resolution of this matter. The supreme court in Cheramie, supra, expressly held that LUTPA is not limited to consumers and business competitors, abrogating any prior ruling to the contrary. The supreme court further stated that LUTPA applies to any person who suffers a loss due to the unfair methods and deceptive business practices of another. Our analysis, therefore, is not concerned with whether LEC has a right of action under LUTPA by virtue of the Plaintiffs/lessors’ status, i.e., whether the parties fit into the class of persons the statute was intended to protect.

The critical issue before us, rather, is whether the allegations made by LEC state a cause of action under LUTPA— whether facts were alleged that, if taken as true, constitute the type of conduct to which the prohibitions of LUTPA were designed to extend. In this regard, the supreme court in \7Cheramie went on to explain that “it has been left to the courts to decide, on a case-by-case basis, what conduct falls within the statute’s prohibition.” See also Dufau v. Creole Engineering, Inc., 465 So.2d 752 (La.App. 5th Cir.), writ denied, 468 So.2d 1207 (La.1985).

In order to recover under LUTPA, a plaintiff must prove “some element of fraud, misrepresentation, deception, or other unethical conduct” on the part of the defendant. Cheramie, supra. The plaintiff must show that the alleged conduct “offends established public policy and ... is immoral, unethical, oppressive, unscrupulous or substantially injurious.” Id. Quoting from Turner v. Purina Mills, Inc., 989 F.2d 1419 (5th Cir.1993), the supreme court in Cheramie further explained:

LUTPA does not prohibit sound business practices, the exercise of permissible business judgment, or appropriate free enterprise transactions. The statute does not forbid a business to do what everyone knows a business must do: make money. Businesses in Louisiana are still free to pursue profit, even at the expense of competitors, so long as the means used are not egregious. Finally, the statute does not provide an alternate remedy for simple breaches of contract. There is a great deal of daylight between a breach of contract claim and the egregious behavior the statute proscribes. (Internal citations omitted.)

In addition, in concurring with the majority in Cheramie, Justice Johnson noted that the range of prohibited practices under LUTPA is extremely narrow. Id.

Against this backdrop, we examine the following allegations stated in LEC’s Amended Reconventional Demand:

5.
Beginning in July 2008 and before, plaintiffs have been engaged in a joint effort or conspiracy to cause harm to LEC by making knowingly false public statements and allegations 18about LEC’s activities as operator in a fraudulent effort to have the leases terminated and/or to sufficiently cloud the rights, title and status of LEC as lessee/operator so as to prevent LEC from farming out or otherwise further develop its interest in the leases. The knowingly false statements include statements that LEC has never paid royalties due under the Leases; that it had not operated the Leases as a reasonable and prudent operator and that it had not reasonably developed the Leases. The existence of the conspiracy was revealed in a letter dated July 28, 2008 authored by Thomas Paul Brown and Frances Sue Mobley Brown in which they solicited other members of the plaintiffs group to join them in their illegal efforts to avoid their obligations under the Leases. The Browns held public meetings at the Stonewall Library in Stonewall, Louisiana on July 30, 2008; August 11, 2008; September 10, 2008 and October 1, 2008. Those meetings were attended by other plaintiffs and by third parties who are not plaintiffs. Plaintiffs attended the meetings and joined the conspiracy and the efforts to harm LEC by making and/or adopting the knowingly false statements outlined above.
6.
The conspiracy and efforts to harm LEC culminated in the filing of the present lawsuit against LEC in February 2009. The lawsuit contains knowingly false statements by plaintiffs to the effect that LEC has never paid royalties due under the Leases; that it had not operated the Leases as a reasonable and prudent operator and that it had not reasonably developed the Leases. These statements were sworn to by the plaintiffs as true in verifying affidavits to the petition and were made with the malicious intent to cause harm to LEC by having the leases terminated and/or sufficiently clouding the rights, title and status of LEC as lessee/operator so as to prevent LEC from farming out or otherwise further develop its interest in the Leases. In their depositions taken on May 20, 2009, plaintiffs Thomas Brown, the City of Stonewall (through its mayor Curtis McCune) and the Salem Baptist Church (through its representative Curtis McCune) admitted that their statements that they had never been paid royalties under the Leases were not true and that their purpose in organizing the plaintiffs’ group, in making the false statements in the lawsuit and otherwise was to have the leases terminated and to sufficiently cloud the rights, title and status of LEC as lessee/operator so as to prevent LEC from farming out or otherwise further develop its interest in the Leases.
_1⅛8.
LEC believes that the knowingly false statements by all plaintiffs were made directly to, or were otherwise communicated to representatives of a number of oil and gas companies that were potentially interested in pursuing joint development activities of the Leases with LEC ... none were willing to pursue any sort of arrangement for development of the Leases with LEC. This result was precisely what was intended by the plaintiffs and was the object of their conspiracy.

It is undisputed that the lessors were unhappy with the leasing arrangement with J & K Petroleum and, thus, with LEC, and the performance of LEC as operator. We do not find dishonest, immoral or egregious, however, allegations that the lessors attended meetings to discuss their leases with other similarly situated lessors. Further, LEC’s belief that lessors communicated unfavorable opinions of LEC to others does not constitute the type of egregious conduct envisioned by the legislature in LUTPA.

Simply stated, this matter involves lessors and a lessee to 22 mineral lease contracts, all of whom are dissatisfied with the conduct of the opposing party(ies). The lessors sued the lessee and the lessee reconvened, claiming that it has been unable to farm out the leases at issue because of the dispute -with the lessors and based upon its belief that lessors had been misrepresenting the lessee to other oil and gas companies. While this case is not “a simple breach of contract” case, we find a “great deal of daylight” between these allegations and the scope of unfair and deceptive conduct in trade and commerce that LUTPA was intended to proscribe. Cheramie, supra, citing Turner, supra. We further find this interpretation to be | insupported by the fact that the development of consumer protection laws was essentially a response to consumer dissatisfaction with their treatment in the marketplace. See Cheramie, supra, J. Johnson concurring, citing Breeden and Lovett, Louisiana’s New Unfair Trade Practice and Consumer protection Law, 20 La. B.J. 307 (1973).

For these reasons, our de novo review leads this court to agree with the trial court’s judgment sustaining Plaintiffs/lessors’ exception of no cause of action regarding LEC’s claim under LUTPA.

Tortious Interference with Business

LEC also asserts that the Amended Reconventional Demand sufficiently pleads a cause of action for tortious interference with business under La. C.C. art. 2315. LEC argues that the actions of the lessors improperly influenced its ability to conduct business with third parties, ie., further development of the leases with other oil and gas companies. According to LEC, the lessors did this by knowingly making false statements to other lessors to influence them to break them leases with LEC and to other companies to cast doubt on LEC as a prudent operator.

On the other hand, Plaintiffs/lessors suggest that this purported cause of action is a melding of an improperly pleaded tortious interference with contract claim and a defamation claim.

The Restatement (Second) of Torts § 766B provides:

One who intentionally and improperly interferes with another’s prospective contractual relation (except a contract to marry) is subject to liability to the other for the pecuniary harm resulting from loss of the benefits of the relation, whether the interference consists of |n (a) inducing or otherwise causing a third person not to enter into or continue the prospective relation or (b) preventing the other from acquiring the prospective relation.

Louisiana courts have recognized a cause of action for tortious interference with business relations. Junior Money Bags, Ltd. v. Segal, 970 F.2d 1 (5th Cir.1992); Dussouy v. Gulf Coast Inv. Corp., 660 F.2d 594 (5th Cir.1981). The cause of action for tortious interference with business derives from La. C.C. art. 2315. Tor-tious interference is based on the principle that the right to influence others not to enter into business relationships with others is not absolute. Junior Money Bags, Ltd., supra, citing Ustica Enterprises, Inc. v. Costello, 434 So.2d 137 (La.App. 5th Cir.1983). Louisiana law protects the businessman from “malicious and wanton interference,” though it permits interferences designed to protect legitimate interests of the actor. Dussouy, supra. A plaintiff bringing a claim for tortious interference with business must ultimately show “by a preponderance of the evidence that the defendant improperly influenced others not to deal with the plaintiff.” Junior Money Bags, Ltd,., supra. Significantly, it is not enough to allege that a defendant’s actions affected plaintiffs business interests; the plaintiff must allege that the defendant actually prevented the plaintiff from dealing with a third party. Ustica, supra.

The jurisprudence has viewed this cause of action with disfavor. In JCD Mktg. Co. v. Bass Hotels and Resorts, Inc., 01-1096 (La.App. 4th Cir.3/6/02), 812 So.2d 834, the court explained:

Louisiana courts have limited this cause of action by imposing a malice element, which requires that the plaintiff show the | ^defendant acted with actual malice. Although its meaning is not perfectly clear, the malice element seems to require a showing of spite or ill will, which is difficult (if not impossible) to prove in most commercial cases in which conduct is driven by the profit motive, not by bad feelings. In fact, there appear to be no reported cases in which anyone actually has been held liable for the tort. In order to sustain a claim for tortious interference with business relations, actual malice must be pleaded in the complaint. (Internal citations omitted.)

Applying the above principles to the allegations in the Reconventional Demand of LEC, we conclude that LEC has failed to state a cause of action under this very limited theory of recovery in Louisiana. First, there are no factual allegations describing any conversation between a particular plaintiff/lessor and any particular entity with whom LEC was attempting to confect a business relationship. Second, the allegations of the Reconventional Demand fall short of the malice, ill will or spite element that must be pleaded in the petition to sufficiently state a cause of action for tortious interference with business. JCD Mktg. Co., supra.

In light of our conclusions herein, we pretermit any discussion of the ruling on the exception of vagueness.

CONCLUSION

For the foregoing reasons, the judgment of the trial court granting the Exception of No Cause of Action and Vagueness and dismissing the Reconventional Demand of Louisiana Energy Consultants, Inc., is affirmed. Costs of appeal are assessed to Louisiana Energy Consultants., Inc.

AFFIRMED.

      . The original lessee was J & K Petroleum, L.L.C., also a named defendant in the action for declaratory judgment. In June 1997, J & K Petroleum assigned to LEC all of its right, title and interest (reserving an overriding royalty interest) in the subject leases. J & K Petroleum is not involved in the current appeal.


author: STEWART, J.

text:
    Steven Ralph DICKERSON and Marcia Jeanette Simmering Dickerson, Plaintiffs-Appellees v. Henson S. COON, Jr. and Joan Terry Coon, Defendants-Appellants.
    No. 46,423-CA.
    Court of Appeal of Louisiana, Second Circuit.
    Aug. 10, 2011.

      Dewey J. Smith, Jr., Monroe, LA, for Appellants.
    Shotwell, Brown & Sperry, Monroe, LA, by Marshall T. Napper, for Appellees.
    Before WILLIAMS, STEWART and LOLLEY, JJ.
   STEWART, J.

_JjThe defendant, Joan Terry Coon, individually and as Independent Executrix of the Succession of Henson S. Coon, Jr. (hereafter “Coon”), appeals a judgment granting a right of passage in favor of the plaintiffs, Steven Ralph Dickerson and Marcia Jeanette Simmering Dickerson (referred to jointly as “Dickerson”). Coon asserts that the trial court committed manifest error in placing the servitude along the shortest route and in failing to award damages. We find no manifest error by the trial court in fixing the servitude along the shortest route, but we do find that the trial court erred in failing to award damages for the value of the timber that will have to be removed from Coon’s land.

FACTS

On March 11, 2008, Dickerson filed a petition seeking a right of passage for an enclosed estate described as follows:

The Southwest Quarter of Northeast Quarter, Section 28, Township 17 North, Range 1 East, Ouachita Parish, Louisiana, containing 40 acres, more or less.

The nearest public road is Guyton Loop Road, part of which is located on neighboring property owned by Coon and described as:

The Northeast Quarter of Southwest Quarter and Northwest Quarter of Southeast Quarter, Section 28, Township 17 North, Range 1 East, Ouachita Parish, Louisiana.

Dickerson asked that the right of passage be located along an existing logging road that begins at Guyton Loop Road and runs through Coon’s land north of the road up to the southwest corner of his land. Aternatively, Dickerson asked the court to select the shortest route from Guyton Loop Road to the southwest corner of his property.

| ^Dickerson attached to the petition plats and surveys detailing a 15-foot wide servitude over both the logging road and the shortest route. These two routes are in the same general area of the Coon property. According to calculations based on the attachments, the distance along the logging road is 2,433.67 feet, and the route contains 0.272 acres. The distance along the shortest route is 1,433.96 feet and contains 0.242 acres.

In answer, Coon asserted that the area of the logging road is the highest point of elevation on his land. He claimed that establishing a right of passage along the logging road would bisect the property and disturb the hunting club, which leases the acreage. Coon asserted that his acreage is used to grow timber, whereas the Dickerson acreage is at a lower elevation, subject to frequent flooding, and best described as a marsh for most of the year. Coon proposed an alternative right of passage along the north boundary of his westerly tract. Coon asserted that the boundary route would provide access to Dickerson’s marshy acreage without bisecting his best land or disturbing the hunting club. Dickerson had previously rejected this route.

The main issues at trial concerned the location of the right of passage and damages, if any. That the Coon property was the servient estate and owed a right of passage for the benefit of Dickerson’s enclosed estate was not disputed. The trial court recognized three possible options for location of the right of passage: (1) the shortest route; (2) the existing logging road; and (3) the border or west side/ north side route proposed by Coon. After hearing the evidence and viewing the properties and areas of the proposed | ¡¡routes in person, the trial court ordered that the right of passage be fixed along the shortest route. The trial court found that the other two options had “pros and cons of equal weight” but that the first option, the shortest route, was clearly in line with the codal provisions governing rights of passage.

Judgment was rendered September 22, 2010, granting Dickerson the right of passage across the shortest route on Coon’s land from Guyton Loop Road to the southwest corner of Dickerson’s enclosed estate. The judgment did not mention any award of damages to Coon. Each party was ordered to bear its own costs and pay one-half the court costs.

Mr. Henson S. Coon, Jr., died on July 28, 2010. For purposes of the appeal, his wife, Joan Terry Coon, was appointed Independent Executrix for his succession and recognized as the defendant in lieu of the deceased.

DISCUSSION

Location of the Right of Passage

The trial court’s factual findings are subject to reversal if the appellate court finds that no reasonable factual basis exists for the findings of fact and determines that the record establishes that the trial court’s findings are manifestly erroneous or clearly wrong. Allerton v. Broussard, 2010-2071 (La.12/10/10), 50 So.3d 145, recon. denied, 2010-2071 (La.1/28/11), 56 So.3d 974; Stobart v. State, Through Dept. of Transportation and Development, 617 So.2d 880 (La.1993). The appellate court does not determine whether the trier of fact was right or wrong. Rather, the issue to be resolved is whether the trier of fact’s conclusion was reasonable based on a review of the entire record. Stobart, supra. If the trier of fact’s findings hare reasonable in light of the record reviewed in its entirety, then reversal is not warranted. Id. This is so even if the appellate court, sitting as the trier of fact, would have weighed the evidence differently. Id. Where there are two permissible views of the evidence, “the factfinder’s choice between them cannot be manifestly erroneous or clearly wrong.” Id. at 883.

La. C.C. art. 689 permits the owner of an estate with no access to a public road to claim a right of passage over neighboring property to the nearest public road. The owner of the enclosed estate “is bound to indemnify his neighbor for the damage he may occasion.” Id.

La. C.C. art. 692, which governs location of the right of passage, instructs that the owner of the enclosed estate may not demand a right of passage at the location of his choice. Rather, it “generally shall be taken along the shortest route from the enclosed estate to the public road at the location least injurious to the intervening lands.” La. C.C. art. 692.

The use of “generally” in La. C.C. art. 692 indicates that there are exceptions to the shortest route requirement. The circumstances of each case will determine the location of the servitude. Anderton v. Akin, 493 So.2d 795, 797 (La.App. 2d Cir. 1986), writ denied, 497 So.2d 1014 (La.1986). Upon determining which estate will be burdened with the right of passage, courts usually engage in a balancing test to determine where on the servient estate the right of passage should be located. Davis v. Culpepper, 34,736, p. 8 (La.App.2d Cir.7/11/01), 794 So.2d 68, 73-74, writ denied, 2001-2573 (La.12/14/01), 804 So.2d 646, citing Mitcham v. Birdsong, 573 So.2d 1294 (La.App. 2d Cir.1991); Roberson v. Reese, 376 So.2d 1287 (La.App. 2d Cir.1979); C. Sherburne Sentell, III, Comment, Fixing the Right of Passage from an Enclosed Estate: Deciding Where to Break Out Using Louisiana Civil Code Article 692, 54 La. L.Rev. 1659, 1670 (1994).

However, departure from the general rule requiring location of the right of passage along the shortest route “must be supported by weighty considerations.” A.N. Yiannopoulos, 4 La. Civ. Law Treatise, Predial Servitudes § 97, (3d Ed.2004). While courts will normally grant a right of passage that is least injurious to the servient estate, other factors such as distance, degree of injury to the servient estate, practicability, and cost weigh in the decision of where to locate the right of passage. Id.

Instruction on fixing the right of passage is found in Anderton, 493 So.2d at 798, which explains that while the right of passage should be fixed at the point least injurious to the servient estate, the matter of its location is not to be left to the “caprice or option” of the party who must grant the servitude. The court must also be mindful of the rights that the law affords the dominant estate owner. As such, a right of passage that is “extremely circuitous, impracticable, and expensive” should not be selected because it is less burdensome to the servient estate owner. Anderton, supra, citing Wells v. Anglade, 23 So.2d 469 (La.App. 1st Cir.1945), citing Littlejohn v. Cox, 15 La.Ann. 67 (La.1860).

Coon argues that the trial court erred in fixing the passage along the shortest route rather than along the boundary route, which would be least injurious. Coon asserts that the evidence proves that both the logging road and the shortest route would be injurious. Both routes would divide the 551 (¡acres north of Guyton Loop Road into about a 45-acre tract east of the servitude and a 10-acre tract west of the servitude. Also, either route would bisect the 55 acres at its crown (area of highest elevation), which Coon considers a prime area for building a house.

The possibility that grandchildren might one day build a house on the property and the concern that the passage dividing the property might prevent them from doing so was expressed by the defendants’ son, Henson S. Coon, III, (“Henson”) in his testimony and by the defendant, Henson S. Coon, Jr., (“Mr. Coon”) in his deposition, which was introduced into evidence in lieu of his testifying. Coon’s expert appraiser, A.J. Burns, Jr., agreed that fixing the passage along the shortest route or the logging road would bisect the property and diminish that area’s desirability as a house site.

In his deposition, Mr. Coon stated that he inherited the land from his father, had owned it for 50 years, had harvested timber, and had leased it to a hunting club for the last 17 years. He recalled that when his father purchased the property, there had been a house site in the area of the logging road. His son Henson believed there may have been a home on the property about 100 years ago. Mr. Coon also recalled that the logging road was used for a while to access an oil well on the property. About five years before Dickerson bought the land, Mr. Coon had allowed a lumber company that was harvesting timber from what is now Dickerson’s land to use the logging road.

[7We are not persuaded by the argument that the shortest route is injurious to Coon’s land because it divides the 55 acres north of Guyton Loop Road at its crown and might prevent the use of that area as a home site. Coon has owned the property for over 50 years without residential development on it. There are no plans for future development. Mr. Coon and Henson merely expressed the desire that descendants might one day build a house on the property. If the servitude interferes with any future development, the servient estate has the right to demand relocation of the servitude to a more convenient location at his expense. La. C.C. art. 695. Also, nothing in the record shows that a passage along the shortest route would interfere with the hunting club which leases the Coon property.

Steven Dickerson testified that he purchased his property, which consists of 25 acres of wetland and 15 acres of timberland, in March 2008 for recreational purposes and for a timber investment. He estimated that he would need access to the property once per week to transport tools and materials either by foot, utility vehicle, or a light truck. He has no plans to erect a permanent structure or run utilities to the property. He requested the logging road because it was comparable to the shortest route, would require limited work to make passable, and no timber would have to be cleared. However, he had no strong objection to the shortest route even though it would require him to clear timber and bring in dirt to make a passage. He explained that the boundary route would require him to clear even more timber, to bring in even more dirt, and to contract engineering work to address an area where water collects along the route.

1 sDarryl James Rayner, Jr., a dirt contractor and owner of R & R Dirt, L.L.C., testified as an expert in road maintenance and construction on behalf of Dickerson. Rayner prepared cost estimates for constructing a passable 15-foot wide servitude along the three proposed routes. Rayner testified that it would cost $997.50 to make the existing logging road passable and would require about 45 cubic yards of dirt to fill holes and shape the roadway. Construction of a passable roadway along the shortest route would cost $4,457.50, for excavation work, installation of a drainage pipe, and dirt work to fill the area of the roadway. Construction of a passable roadway along the Coon boundary route would cost $11,220.00, and would require the setting of two drainage pipes, excavation work, and 650 cubic yards of dirt for spreading and filling along the passage.

Gregory Hebert, a professional forester, testified as an expert in timber on behalf of Dickerson and conducted a timber assessment for the shortest route and the boundary route. He did not assess the area of the logging road because he did not expect there would be a need to remove much timber in an area where a passage already existed. He determined the value of the timber along the boundary route to be $643.60, and the value of the timber along the shortest route to be $291.43.

Considering cost and practicability, this court, if sitting as the trier of fact, may have selected the existing logging road which historically had been used as a passage and is in close proximity to the shortest route. However, we cannot conclude that the trial court’s selection of the shortest route is unreasonable or that reversal is warranted. The law favors the | pshortest route, and departure from the general rule favoring the shortest route is not supported by “weighty considerations.” The shortest route will provide direct access from the Dickerson’s tract to the nearest public road. Making a passable roadway along the shortest route will involve considerably less expense than doing so along Coon’s proposed boundary route. From our review of the record, we find the fixing of the right of passage along the shortest route to be neither manifestly erroneous nor clearly wrong.

Damages

Coon also argues that the trial court erred in failing to address and award damages. Coon seeks damages totaling $16,891.43 for a servitude along the shortest route.

The trial court’s judgment is silent as to the issue of damages. When a judgment is silent as to a party’s claim or demand, it is presumed that the trial court denied the relief sought. TSC, Inc. v. Bossier Parish Police Jury, 38,717 (La.App.2d Cir.7/14/04), 878 So.2d 880. Based on this principle of law, we find that the absence of any mention of damages in the judgment equates to a denial of damages.

La. C.C. art. 689 provides that the owner of an enclosed estate who claims a right of passage over neighboring property is “bound to indemnify his neighbor for the damage he may occasion.” This provision recognizes that the owner of the servient estate “may” receive “damage” requiring indemnification by the owner of the dominant estate. Greenway v. Wailes, 41,412, p. 12 (La.App.2d Cir.8/1/06), 936 So.2d 296, 303. The Greenway |inopinion explains that “damage” under La. C.C. art. 689 does not mean compensation based on the appraised value of the servient property as though the fixing of the right of passage is an expropriation or taking of the property. The right of passage is a legal servitude, a limitation on ownership established by law for the benefit of the general public or particular persons. La. C.C. art. 659. This limitation on ownership is for the “common utility” of adjacent properties and has been part of this state’s policy regarding ownership of land since statehood. Greenway, supra, at 41,412, p. 12, 936 So.2d at 303, and provisions cited therein. Moreover, the right of passage for the enclosed estate “has been a limitation on ownership of immovables since our earliest civil code.” Id.

The burden is on the owner of the servient estate to prove the amount of damage resulting from the servitude of passage. Bailey v. McNeely, 2005-629 (La.App.3d Cir.12/30/05), 918 So.2d 1124. Burns, Coon’s expert real estate appraiser, testified as to the damages he believed would be due for the “taking” or use of the right of passage. He valued the right of passage at $2,000 based on comparable sales of “rye grass and easements” and what he learned from talking to others who had negotiated such things. Next, he determined that the 55-acre tract, which he valued at $146,000, would suffer a 10 percent diminution in value when burdened with the right of passage. Thus, he assessed damages in the amount of $14,600. He likened these damages to severance damages. Burns believed that a right of passage along the shortest route, or even the logging road, would diminish the desirability of the area for building a house. Based on Burns’ testimony |nand the timber value attributed to the shortest route by Dickerson’s timber expert, Coon seeks damages in the amount of $16,891.43.

Dickerson’s expert appraiser, Richard K. Moore, could not come up with any damages or calculate any loss to Coon’s property from use of a right of passage along the shortest route, or even the logging route. He believed there to be enough acreage in the area of the crown to have a home site set back from the roadway. Thus, any damage from use of the right of passage would be minimal.

When expert testimony differs, the trial court must determine the more credible evidence. ScenicLand Const. Co., LLC v. St. Francis Medical Center, Inc., 41,147 (La.App.2d Cir.7/26/06), 936 So.2d 247. The effect and weight to be given to expert testimony depends on the underlying facts and rests within the broad discretion of the trial court. Id. In deciding to accept the opinion of one expert and reject the opinion of another expert, the trial court can virtually never be manifestly erroneous. Id.; Fox v. Fox, 97-1914 (La.App.1st Cir.11/6/98), 727 So.2d 514, unit denied, 99-0265 (La.3/19/99), 740 So.2d 119.

By denying damages, the trial court must have accepted the expert appraisal testimony offered by Moore and rejected Burns’ testimony. This finding is supported by Greenway, supra. Burns’ assessment of damages was based on his view of the right of passage as a taking for which compensation is due rather than as the exercise of a limitation on ownership that already burdened Coon’s property. The trial court could have reasonably credited Moore’s opinion that there would be sufficient acreage |12for both a home-site and roadway in the area of the shortest route and that there would bé no damage resulting from use of the right of passage. Also, Burns improperly valued the right of way by comparison with sales of easements. La. C.C. art. 689 refers to indemnification for damages that may be occasioned; it does not provide for compensation to the owner of the servient estate for the right of passage.

Though we find no error in the trial court’s failure to award damages based on the testimony of Coon’s appraiser, we do find that the record establishes damages in the amount of $291.43 based on the value of the timber that will have to be removed from the area of the servitude. We find that this amount, $291.43, should have been awarded to Coon, and amend the trial court’s judgment accordingly.

CONCLUSION

For the reasons explained, we affirm the judgment of the trial court fixing the servitude of passage along the shortest route. We amend the judgment to award damages of $291.43 for the removal of timber in the area of the passage. Each party is to bear his own costs on appeal.

AMENDED IN PART, and AFFIRMED AS AMENDED.