Opinion ID: 26067
Heading Depth: 2
Heading Rank: 3

Heading: Count Six: Avoidance of the Exchange Agreement and Conveyance.

Text: 16 Count Six of the amended complaint asserts that the Taylors failed to abide by the terms of the Act of Exchange within the time limitations and seeks to set aside the conveyance from the Serses to the Taylors based on lack of consideration. 17 Because, as we have stated, Louisiana law does not consider the redemption a new conveyance, this argument assumes an attempted redemption may be deficient in such a way that it is deemed a new transaction. Trinity argues that the redemption should be set aside because the right of redemption was not self-executing, that is, certain conditions precedent in the Act of Exchange were never met: the Serses were to execute new deeds, the deeds were to be quitclaim rather than warranty, the Taylors were to pay all the rent under the lease-back, the Taylors were to return the 600,000 shares of Trinity stock to the Serses, and the Taylors were to post a letter to the Serses at their last known address. 18 The Act of Exchange shows that the Taylors' right of redemption is conditioned solely on the stock price and is exercisable by the posting of the notice via certified letter. Both the condition precedent and the resolutory condition appear in the following provision: 19 The Taylors are willing to accept the Stock in exchange for the Real Estate Property subject to the Stock having an average quoted bid price . . . of not less than $1.00 per share on any public stock exchange on which the Stock is listed for sale at the close of trading on the Anniversary Date. In the event the Stock should have an average quoted bid price less than $1.00 per share at the close of business on the Anniversary Date, the Taylors shall have the right to redeem the Real Estate Property for a period of thirty (30) days from the Anniversary Date. It is expressly agreed and understood by the parties hereto that the posting of the notice of redemption by certified mail addressed to the Sers at their last known residence address is a resolutory condition which will automatically operate to dissolve this Act of Exchange. In such event, the Taylors, shall return the stock to the Sers. 20 Ex. A to Am. Complaint, para. 4 of Exchange Agreement (emphasis added). A certified letter to the Serses stating the Taylors' intent to redeem and offering to return the stock to them or their designee is also appended to the complaint (ex. E). The sole condition precedent of the redemption the stock price on the Anniversary Date is not at issue. 3 The resolutory condition occurred when the letter was posted. Though Trinity complains that Sidney Sers executed the deed from Cali, Columbia, where he was a fugitive, on the same day the Taylors sent the certified letter to him in Texas, nothing in the agreement requires proof that written notice was delivered before execution of the instrument recognizing that the property was redeemed. 21 The last sentence in the provision quoted above demonstrates that the return of the stock is not a condition precedent but rather occurs after the resolution of the exchange. 4 Nor are the execution of a deed and payment of rent conditions precedent to exercising the right to redeem. 5 Accordingly, the redemption was exercised by the posting of the notice, and placed the parties in the same state as though the Exchange Agreement had never been entered. 22 Under no circumstances could Trinity prove that any failure to abide by the terms of the Act of Exchange entitles Trinity to recover the real estate from the Taylors, or that their redemption can be characterized as a new transfer from the Serses. 23