Kyzar, Judge.
The plaintiff, Doris H. Usie, filed this application for supervisory writs seeking to have the trial court judgment sustaining the exceptions of prematurity in favor of the defendants, Royer Mobile Homes of Opelousas, Inc. and Sunshine Homes, Inc. set aside. For the following reasons, we grant the writ application and make it peremptory by reversing the trial court judgment and remanding the matter for further proceedings.
On March 27, 2007, Usie went to Royer Mobile Homes of Opelousas, Inc. (Royer) to find a new manufactured home (hereinafter sometimes referred to as "home") to take the place of her present home. After choosing a home, she paid a non-refundable deposit of $500.00 by check so Royer would hold the home until she could arrange financing through a third-party lender. On April 10, 2007, Usie executed a purchase agreement with Royer, which identified both the home and the home's purchase price of $39,500.00, and which was signed by both Usie and Alan Amy, Royer's president. However, since Usie's financing arrangements were not yet finalized, Royer agreed that it would continue to hold the home, as well as Usie's $500.00 check.
On April 19, 2007, First Louisiana National Bank, on behalf of Usie, issued a check payable to Royer in the amount of $33,500.00, for the bulk of the home's purchase price. The remaining balance of the purchase price, $6,000.00, was obtained from the trade-in value of Usie's former home. On May 5, 2007, Usie returned to Royer to sign additional documents, one of which was entitled "ACKNOWLEDGMENT AND AGREEMENT (HUD CODE HOME)," which contained the subject arbitration agreement, as follows:
No representative of Sunshine, the manufacturer, was present when the parties executed this document on May 5, 2007, although the signature of Sunshine's service manager, Hugh M. Ballard, was added at a later, unspecified time.
Usie alleged that she began experiencing health problems in October 2013, and that she discovered leaks in her roof in 2014. Upon further investigation, she determined that there was roof damage, rotting wood, and mold in her home. After paying for extensive home repairs, Usie filed the instant suit against Royer, the seller, and Sunshine.
In response to the lawsuit, Royer and Sunshine each filed exceptions of prematurity, arguing that this suit should be dismissed or stayed and that Usie should be required to arbitrate her claims pursuant to the arbitration clause contained in the "Acknowledgment and Agreement" document signed by her. Following a hearing, the trial court sustained the exceptions and stayed the matter pending resolution of the claims in arbitration. Usie has filed the instant writ application seeking reversal of the trial court judgment.
In Abshire v. Belmont Homes, Inc., 04-1200, pp. 7-8 (La.App. 3 Cir. 3/2/05), 896 So.2d 277, 283 (alteration in original), writ denied, 05-862 (La. 6/3/05), 903 So.2d 458, this court set forth the proper standard for reviewing a trial court's judgment sustaining an exception of prematurity based on an arbitration provision, as follows:
The law applicable to the enforceability of arbitration agreements was recently discussed in Duhon v. Activelaf, LLC, 16-818, pp. 5-6 (La. 10/19/16), ___ So.3d ___, ___, 2016 WL 6123820 (third alteration in original), as follows:
In determining whether an arbitration agreement should be enforced, we first recognize that there exists a strong legislative policy in Louisiana favoring arbitration. Aguillard v. Auction Management Corp., 04-2804 (La. 6/29/05), 908 So.2d 1. In support of this policy, Louisiana has enacted the Louisiana Binding Arbitration Law (LBAL), which is found at La.R.S. 9:4201-4217. Specifically, La.R.S. 9:4202 provides:
The arbitration clause in the present case specifically references the Federal Arbitration Act (FAA), 9 U.S.C. § 1, et seq. Section Two of the FAA provides:
9 U.S.C. § 2 (emphasis added).
Usie raises numerous arguments in support of a reversal of the trial court's ruling, amongst which is that Coleman v. Jim Walter Homes, Inc., 08-1221 (La. 3/17/09), 6 So.3d 179, which the defendants and the trial court relied on, is distinguishable from the facts of the instant case. In that case, the supreme court held that arbitration was required in a claim arising from the sale of a manufactured home. Although the purchaser entered into an agreement to purchase a home manufactured by Jim Walter Homes, Inc., the initial agreement was verbal and both parties understood that written documents would have to be signed at a later date to complete the sale. To that point, the supreme court stated:
Coleman, 6 So.3d at 183.
In contrast, Usie relies on three cases from this court: Quebedeaux v. Sunshine Homes, Inc., 06-349 (La.App. 3 Cir. 10/11/06), 941 So.2d 162, writs denied, 06-2698, 06-2772 (La. 1/8/07), 948 So.2d 131, 948 So.2d 134; St. Romain v. Cappaert Manufactured Housing, Inc., 05-140 (La. App. 3 Cir. 6/1/05), 903 So.2d 1186; and Abshire v. Belmont Homes, Inc., 04-1200 (La.App. 3 Cir. 3/2/05), 896 So.2d 277, writ denied, 05-862 (La. 6/3/05), 903 So.2d 458.
In Quebedeaux, this court held invalid an arbitration agreement the seller unilaterally added to a purchase agreement because the buyers would have lost their $15,000.00 down payment and $7,000.00 they spent on site preparation had they refused to sign the agreement. In St. Romain, we held that the purchaser of a manufactured home was not required to arbitrate her redhibition claims, when the evidence showed that the purchaser were unaware of and never signed an arbitration agreement as part of her purchase of the manufactured home. In Abshire, we further held that an arbitration agreement was invalid when it was not shown to be part of the consideration for the purchase of the home and that the manufacturer, who was not a party to the purchase agreement, could not unilaterally "assign additional consideration for the perfection of the sale." Abshire, 896 So.2d at 285.
Royer and Sunshine contend that the ruling in Coleman places into question the continued viability of the holdings in Quebedeaux, St. Romain, and Abshire. In Fin & Feather Chalets, LLC v. Southern Energy Homes, Inc., 13-6082, 2014 WL 4354459 (E.D. La. Sept. 2, 2014), which was quoted by the trial court, the federal court declined to address the viability of Quebedeaux, St. Romain, and Abshire because Coleman was on point with the facts at issue in that matter. However, the court in Fin & Feather recognized that state law is applicable to the initial determination of whether an arbitration agreement is valid.
In Posadas v. The Pool Depot, Inc., 02-1819, pp. 3-4 (La.App. 1 Cir. 6/27/03), 858 So.2d 611, 613-14, writ denied, 03-2125 (La. 11/7/03), 857 So.2d 502 (citations omitted) (emphasis added), the court stated as follows:
The written purchase agreement in this instance was executed by Usie and Royer on April 10, 2007. Usie alleges that the sale was complete as of that date; while the Royer and Sunshine contend that the sale was not completed until May 5, 2007, when the document containing the arbitration clause was executed. Pursuant to La.Civ.Code art. 2456, "[o]wnership is transferred between the parties as soon as there is agreement on the thing and the price is fixed, even though the thing sold is not yet delivered nor the price paid." In this instance, the purchase agreement set forth the specific manufactured home that Usie was purchasing and the price to be paid for the home being purchased. While she had not yet obtained financing for the home, La.Civ.Code art. 2456 specifically states that payment of the purchase price is not necessary for ownership to transfer.
Additionally, there is no provision in the purchase agreement making the procurement of financing a condition precedent to the sale. Although the purchase agreement states, "Title to the within described unit passes as of the date of signing of the retail installment or security agreement by the purchasers even though physical delivery may not be made until a later date", financing was not being provided by either the seller or the manufacturer, and those financing documents between the buyer and the third-party lender, if any, were not necessary to the transaction at hand. Further, while the parties anticipated that Usie would trade her used manufactured home as partial payment for the new home, the actual trade in was not required prior to the transfer of ownership of the new home.
Although the trial court concluded that Coleman was controlling, we find that it is distinguishable from the facts at issue here. In Coleman, the parties, who initially entered into a verbal agreement, understood that written documents were necessary to perfect the sale, including the financing documents, which were facilitated by the seller. In the instant case, the parties agree that a written purchase agreement was executed on April 10, 2007, which was clear as to the object of the sale and the price. There were no conditions precedent set forth in the agreement pertaining to this transaction. Indeed, the language in the document itself refers to the purchase as a completed transaction. Moreover, there was neither verbal discussion nor written provisions concerning the necessity to arbitrate at the time the purchase agreement was executed.
Further, while Royer and Sunshine pontificate that Coleman overturned the holdings of this court in Quebedeaux, St. Romain, and Abshire, we find that each of these cases is factually distinguishable from Coleman. To hold to the contrary would be to give every seller the absolute power to demand, even after the fact, that purchasers sign arbitration agreements or risk losing their money or property. Thus, we conclude that the trial court erred in sustaining the peremptory exceptions of prematurity requiring arbitration in this case based upon the holdings in Coleman and Fin & Feathers.
We turn now to determine the validity of the arbitration clause in the agreement dated May 5, 2007, and its effect, if any, when considered separately from the previously executed sale. It is clear that the arbitration agreement, if valid under the contract laws of this state, could, by its own terms, bind the parties to arbitration for any claims related to the prior sale. It is not disputed that the agreement containing the arbitration language was executed by Usie and Royer, through its president, Amy, and that Sunshine was neither a party to the sale nor represented in person when this document was executed.
We find that the facts presented herein are indistinguishable from those in Rodriguez v. Ed's Mobile Homes of Bossier City, Louisiana, 04-1082 (La.App. 3 Cir. 12/8/04), 889 So.2d 461, writ denied, 05-83 (La. 3/18/05), 896 So.2d 1010. There, an arbitration agreement was invalidated for lack of consent by the purchasers, who executed a purchase agreement for a mobile home prior to the mention of or signing of the arbitration agreement. However, despite the fact that they were already legally and financially liable for the mobile home, the Rodriguez plaintiffs genuinely believed, even if they were never explicitly told so, that the execution of the arbitration agreement was a prerequisite to their gaining possession of the home. We held that this "understanding was error under the law." Id. at 464. We, likewise, hold that Usie's understanding in this case was also error under the law. Accordingly, we find that Usie's consent to the arbitration agreement is invalidated based on this legal error.
Further, as we noted in Rodriguez, the manufacturer "knew or should have known that the arbitration agreement could not be part of the consideration of the original contract, especially as no mention of arbitration was made until after signing the original contract. A party cannot, unilaterally, assign additional consideration for the perfection of a sale." Id. Even if the purchase agreement and arbitration agreement had been contemporaneously, evidence is still required that the arbitration agreement was part of the consideration of the original purchase agreement for it to be valid. Abshire, 896 So.2d 277. In this instance, no such evidence is present. Thus, Sunshine, who was not a party to the purchase agreement, is precluded from unilaterally assigning additional consideration for the perfection of the sale in the form of the arbitration agreement. Had Royer required Usie to agree to the arbitration agreement as to both it and Sunshine
For the reasons assigned herein, we grant and make peremptory the application for supervisory writs filed by Doris H. Usie, and in doing so, reverse the judgment of the trial court sustaining the exceptions of prematurity in favor of Royer Mobile Homes of Opelousas, Inc. and Sunshine Homes, Inc. We assess all costs of this writ application to Royer Mobile Homes of Opelousas, Inc. and Sunshine Homes, Inc.
