DENNIS R. BAGNERIS, SR., Judge.
This matter derives from a mandamus action filed by Trustees of the New Orleans Firefighters' Pension and Relief Fund to compel the City of New Orleans to make certain statutory contributions owed to the Fund. As part of its response, the City filed a reconventional demand, seeking injunctive relief and damages based on alleged mismanagement of the Fund by its Trustees.
La. R.S. 11:3361 et seq. (collectively, the pension statute) provides for the creation of the Firefighters' Pension and Relief Fund and outlines contributions that the City shall make to the Fund. On July 19, 2012, the Trustees of the Fund filed a Petition for Writ of Mandamus, requesting that the City be ordered to pay sums owed to the Fund as mandated by La. R.S. 11:3384.
After a hearing on the exceptions, the trial court granted the Fund's exceptions of no right of action and no cause of action based on the City's lack of standing. Thereafter, the City filed a Motion for New Trial To Clarify Judgment, seeking clarification as to whether the City would be permitted to amend its reconventional demand to add New Orleans Fire Department Superintendent, Timothy McConnell, who is also a Fund trustee and member, as a plaintiff-in-reconvention. The trial court denied the motion without a hearing.
This appeal followed.
The City raises three assignments of error. They include that 1) the district court erred in granting the Fund's exception of no right of action; 2) the district court erred in granting the Fund's exception of no cause of action; and 3) the district court erred in denying the City's request for leave to amend and the City's Motion for New Trial to Clarify Judgment.
The Court of Appeal reviews de novo a trial court judgment sustaining an exception of no right of action as a question of law and determines whether the trial court's ruling was correct or incorrect as a matter of law. First Bank and Trust v. Duwell, 11-0104, p. 4 (La.App. 4 Cir. 5/18/11), 70 So.3d 15, 18.
In the present matter, the City argues that as an obligatory payor of substantial monies to the Fund, the City has a right of action to recover damages for the inflated contributions that the City has been called upon to pay into the Fund due to the Trustees' alleged mismanagement. The City suggests that its standing to sue is buttressed by this Court's recent decision to affirm the trial court's judgment that granted mandamus relief which compelled the City to pay into the Fund amounts owed pursuant to La. R.S. 11:3384(F).
We disagree with the arguments advanced by the City. First of all, the City's reliance on City of Louisville is misplaced. Although that decision allowed the City of Louisville to bring an action against the police officers' pension trustees for breaches of fiduciary duty based on bad investment decisions, the State of Louisiana, unlike the Kentucky legislature, has a pension statute that describes the fiduciary duties of the Fund's Trustees and limits the parties who may bring a cause of
The Louisiana legislature has delineated the fiduciary and investment responsibilities of the Fund's Trustees in La. R.S. 11:3363.1. In particular, La. R.S. 11:3363.1E provides that a fiduciary must discharge his duties solely in the interest of system members and beneficiaries for the exclusive purpose of providing benefits to participants and beneficiaries, and paying the expenses of administering the plan. La. R.S. 11:3363.1H(1) states in part that a
Next, we reject the City's contention that this Court's decision in New Orleans Fire Fighters Pension, supra, created a suretyship between the City and the Fund so as to give the City a right of action for the relief requested in its reconventional demand. The City argues that as a surety, the City is entitled to recoup from the Trustees any contributions caused by the Trustees' bad investments under the law of suretyship.
This Court does not dispute that the City has an interest in the Fund's investment decisions; however, the pension statute referenced herein only establishes mandates that require the City to make contributions to the Fund. These mandates align with the State legislature's acknowledged intent to ensure that the firefighter's retirement benefit fund is fully funded. We find nothing within these statutes that creates a fiduciary duty between the City and the Trustees of the Fund; nor do we find anything that affords the City the right to recover damages, seek injunctive relief, control the Fund's investment decisions, or obtain any of the other relief requested in its reconventional demand.
The City contends that in the event the trial court properly granted the Fund's exceptions, that La. C.C.P. art. 934 requires that the City should have been given an opportunity to amend its reconventional demand. Accordingly, the City claims the trial court erred in denying its motion for new trial to clarify judgment that sought leave to name Board member and New Orleans Fire Department Superintendent, Timothy McConnell, as a plaintiff-in-reconvention. The City represents that as a Fund trustee and member, Superintendent McConnell has standing to bring the claims asserted in the City's reconventional demand.
La. C.C.P. art. 934 states in part that "[w]hen the grounds of the objection pleaded by the peremptory exception may be removed by amendment of the petition, the judgment sustaining the exception shall order such amendment within the delay allowed by the court." Therefore, the question for this Court to answer is whether the addition of Superintendent McConnell as a plaintiff-in-reconvention would give the City a right of action; we answer "no."
The exception pleading objection of no right of action, questioning plaintiff's standing or interest to bring suit, relates specifically to person of plaintiff; standing raises issue of whether plaintiff belongs to particular class for which law grants remedy for particular grievance or whether plaintiff has interest in judicially enforcing right asserted. See Mouton v. Department of Wildlife & Fisheries for State of Louisiana, 95-0101 (La.App. 1 Cir. 6/23/95), 657 So.2d 622. In the matter before us, we have already determined that the City does not have a right of action as the pension statute does not place the City in that class of persons who can maintain a right of action against the Fund. Accordingly, notwithstanding whether Superintendent McConnell may have a right of action or cause of action against the Fund, his status does not empower him or grant him the capacity to bring an action on behalf of the City.
The City does not have standing to seek the remedies sought in its reconventional demand. Any amendment to add Superintendent McConnell to its reconventional demand cannot confer upon the City a right of action; hence, the trial court did not err granting the Fund's exceptions and in denying the City's motion for new trial.
Wherefore, based on the foregoing reasons, the judgment of the trial court is affirmed.
LOBRANO J., dissents.
I respectfully dissent from the majority opinion affirming the trial court's sustaining of the exceptions of no right of action and no cause of action raised by the defendants-in-reconvention. In my opinion, La. Rev.Stat. §§ 11:3362,
Mr. Norman S. Foster, in his capacity as Chief Financial Officer and Director of Finance for the City of New Orleans, is one of the named plaintiffs-in-reconvention in this case. As the Director of Finance for the City, he is also a statutorily named, ex-officio member of the Board of Trustees for the Fund.
Mr. Foster, as well as the other members of the Fund's Board of Trustees, is deemed to be in a fiduciary relationship with the Fund, because he exercises discretionary authority and control with respect to the management of the system funds or assets. See La.Rev.Stat. § 11:3363.1(A)(1). As a fiduciary, he is required to discharge his duties with respect to the system in the exclusive interest of the members and beneficiaries. See La.Rev.Stat. § 11:3363.1(D).
However, if Mr. Foster has any knowledge of a co-fiduciary's breach of any obligation or statutorily imposed duty, as a fiduciary he has a duty to remedy that breach. See La.Rev.Stat. § 11:3363.1(G)(2). Each fiduciary has a duty of accountability for his own actions, inactions, and decisions, as well as those of his co-fiduciaries. In other words, the statute provides the Director of Finance for the City, as a plaintiff-in-reconvention, with both standing
The reconventional demand in this case alleges that various trustees of the board breached their fiduciary duties to the Fund and mismanaged the Fund in numerous ways, including making a series of bad investments. Given that the Director of Finance for the City, one of the plaintiffs-in-reconvention, has a statutory duty to remedy any breach by another co-fiduciary if he has knowledge of that breach, I would remand this case to the trial court to allow the Director of Finance, as a statutorily named, ex-officio member of the Board of Trustees for the Fund, to amend the reconventional demand petition to clearly state his cause of action.
The named defendants-in-reconvention included William M. Carouche, Richard J. Hampton, Nicolas G. Felton, Terrell P. Hampton, Darryl P. Klumpp, Dean DiSalvo, and Keith Noya, in their official capacities as Trustees of the New Orleans Fire Fighters Pension and Relief Fund, collectively, "the Fund."