Court Opinion

ID: 4668334
Source: CourtListenerOpinion
Date Created: 2021-03-16 18:00:20.330749+00
Date Added: 2024-06-11T08:03:02.264981
License: Public Domain

Case: 20-60271     Document: 00515782160          Page: 1    Date Filed: 03/16/2021

              United States Court of Appeals
                   for the Fifth Circuit                        United States Court of Appeals
                                                                         Fifth Circuit

                                                                       FILED
                                                                 March 16, 2021
                                   No. 20-60271                   Lyle W. Cayce
                                                                       Clerk

   Cascade Capital Group, L.L.C.,

                                                             Plaintiff—Appellee,

                                       versus

   David Landrum,

                                                         Defendant—Appellant.

               Appeal from the United States District Court for the
                         Southern District of Mississippi
                            USDC No. 3:17-CV-952

   Before Jolly, Stewart, and Oldham, Circuit Judges.
   Per Curiam:*
          Plaintiff-Appellee Cascade Capital Group, L.L.C. (“Cascade”)
   brought suit against Livingston Holdings, L.L.C., Chestnut Developers,
   L.L.C., Michael Sharpe, and Defendant-Appellant David Landrum
   (collectively, “Borrowers”) due to their default on a Promissory Note and
   subsequent Forbearance Agreement. Landrum admitted all allegations in

          *
            Pursuant to 5th Circuit Rule 47.5, the court has determined that this
   opinion should not be published and is not precedent except under the limited
   circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 20-60271      Document: 00515782160          Page: 2    Date Filed: 03/16/2021

                                    No. 20-60271

   Cascade’s complaint, while the other Borrowers filed counterclaims. The
   district court determined that Landrum was liable for the balance on the Note
   and for attorney’s fees and did not permit Landrum to participate at a bench
   trial considering the liability and counterclaims of the remaining Borrowers.
   Landrum now appeals the denial of his motion for a new trial and the district
   court’s final judgment. We AFFIRM.
                        I. Facts & Procedural History
          In 2008, Borrowers began a project to re-develop the “Old Town” of
   Livingston, Mississippi. In 2011, Borrowers secured a loan from BankPlus to
   fund part of the project. Chestnut, who had acquired the land, provided
   BankPlus with a promissory note in the amount of $978,287.17, secured by a
   Deed of Trust. Livingston Holdings later sought help recapitalizing the
   project. In July 2012, it engaged the consulting services of Cascade, whose
   sole member is Mark Calvert.
          When Borrowers faced default on their BankPlus loan, Calvert offered
   them a new loan, with a principal and interest total of $951,147, despite the
   conflict of interest posed by Calvert serving as both a lender and a financial
   advisor. Borrowers executed the Promissory Note, which was set to mature
   in March 2016. In April 2016, Borrowers executed a Forbearance Agreement,
   requiring a $750,000 payment in December 2016. Borrowers failed to make
   the December payment, placing them in default. Cascade filed a lawsuit in
   December 2017, seeking appointment of a receiver to take possession of
   Borrowers’ property, and a joint and several liability judgment for the
   principal and interest due, as well as attorney’s fees and collection costs.
          All Borrowers except for Landrum filed counterclaims against
   Cascade. In February 2019, the court granted Cascade judgment on the
   pleadings as to Landrum. The same day, the court granted in part and denied
   in part Cascade’s motion for summary judgment. The court determined that

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                                    No. 20-60271

   Borrowers had breached their contract and that there was a genuine issue of
   fact as to whether Cascade had breached its fiduciary duty. There was a
   bench trial from September 23-25 of 2019, and on the first day, the district
   court judge informed Landrum’s counsel that Landrum would not be
   permitted to participate in trial as he had admitted the allegations in the
   complaint and was not a party to any counterclaim. Landrum filed a motion
   for a new trial, which was denied. The district court, in a Rule 54(b)
   judgment, awarded Cascade $1,030,370 in damages from Landrum, as well
   as attorney’s fees and costs.
                             II. Standard of Review
          A district court’s denial of a motion for new trial under Federal Rule
   of Civil Procedure 59 is reviewed for abuse of discretion. Lincoln v. Case, 340
   F.3d 283, 290 (5th Cir. 2003). Awards of attorney’s fees are reviewed for
   abuse of discretion. Davis v. Abbott, 781 F.3d 207, 213 (5th Cir. 2015). The
   reasonableness of attorney rates and hours expended are questions of fact
   reviewed for clear error. La. Power & Light Co. v. Kellstrom, 50 F.3d 319, 324
   (5th Cir. 1995).
                                   III. Discussion
          (A) Participation at Trial and Hearing for Damages
          Landrum argues that he should have been permitted to participate at
   trial to contest damages. Landrum maintains that allegations relating to
   damages could not be deemed admitted and needed to be established in an
   evidentiary proceeding. Landrum contends that he was entitled to protect
   himself from inconsistent judgments among similarly situated defendants,
   and notes that the judgment against all the other Borrowers (who were
   allowed to participate at trial) was significantly lower than the judgment
   against Landrum.

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          This argument conflates whether Landrum should have been able to
   participate at the bench trial with whether he was entitled to a hearing on
   damages. Landrum was not a party to any claims at trial because the court
   had already granted Cascade judgment against him. Landrum cites to no
   authority indicating that a non-party has a right to participate at trial.
   Landrum’s liability and damages were not the subject of this trial. The
   district court acted properly by excluding him.
          Therefore, we must consider whether Landrum was entitled to his
   own hearing on damages. A party may be entitled to such a hearing on
   damages when damages are unliquidated. Capital One Servs. v. Rawls, 904
   So.2d 1010, 1018 (Miss. 2004), overruled on other grounds, BB Buggies, Inc. v.
   Leon, 150 So.3d 90 (Miss. 2014). Unliquidated damages are “damages that
   have been established by a verdict or award but cannot be determined by a
   fixed formula, so they are left to the discretion of the judge or jury.” Moeller
   v. Am. Guar. & Liab. Ins. Co., 812 So.2d 953, 959–60 (Miss. 2002) (internal
   quotation marks omitted). In contrast, liquidated damages are “set or
   determined by a contract when a breach occurs.” Id. at 959. The damages in
   Landrum’s case are clearly liquidated.
          Landrum’s liability for the unpaid debt on the promissory note was
   clearly determined by a contract. Cascade, in its complaint, stated that
   Landrum owed an outstanding debt pursuant to that contract, and that
   Landrum agreed to pay attorney’s fees and costs. Landrum’s answer
   admitted these allegations. The outstanding debt alleged by Cascade and
   admitted by Landrum is the same amount of liability that Landrum now
   disputes. As all the damages awarded by the district court were liquidated,
   the district court did not err by denying Landrum a hearing.
          (B) Liability for Attorney’s Fees and the Balance on the Promissory Note

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                                     No. 20-60271

          Landrum argues on appeal that because he never contested liability
   before the district court, there is no justification for assigning him extensive
   attorney’s fees. However, the district court agreed with this contention and
   reduced Landrum’s fees accordingly. Despite opportunities to do so,
   Landrum refused to provide any sort of detailed dispute of Cascade’s billing
   entries before the district court, and he declined to identify fees attributable
   to Cascade collecting only from the other Borrowers. The district court
   reviewed Cascade’s billing records and found no excessive, duplicative, or
   inadequately documented entries. The court excluded all fees billed after
   Cascade filed a motion for judgment on the pleadings against Landrum, other
   than the fees incurred as a result of Landrum’s motion for a new trial, and
   concluded that Landrum owed $116,576.50. Given the wide discretion
   district courts are afforded in determining attorney’s fees, and Landrum’s
   refusal to provide any guidance as to which fees should not be included, the
   district court did not err in this award.
          Landrum disputes his liability for the debt and attorney’s fees because
   his liability is greater than that of the other Borrowers. However, Landrum,
   unlike the others, admitted all allegations against him and did not argue that
   Cascade breached a fiduciary duty owed to him. The court’s finding of a
   breach of fiduciary duty by Cascade reduced the judgment owed by the other
   Borrowers. Landrum points to no authority to support the proposition that
   inconsistent judgments are not permitted between defendants where one
   does not dispute liability and the other does. The district court properly
   determined that Landrum was liable for the balance of the promissory note
   and attorney’s fees, both of which Landrum admitted.
                                    IV. Conclusion
          For the foregoing reasons, we AFFIRM the district court’s final
   judgment.

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