SHANNON DRIVER AND JASON BOOTHE v. JACK OWENS JR ET AL (2025)

This civil case involves an action by the descendants of a shareholder against an officer and fellow shareholder of a corporation for improper activities depriving the corporation and shareholders of their share from the profits of the corporation's business and sale of certain corporation's assets. The shareholders also sought the dissolution of the corporation.

After a trial on the merits, the trial court dissolved the corporation and awarded plaintiff shareholders their portion from the profits of the corporation's business and sale of certain corporation's assets that transpired after their father was deceased. Defendant shareholder appeals. We affirm.

FACTS AND PROCEDURAL HISTORY

On December 28, 2001, Shirttail Estates, Inc.¹ was formed and incorporated. Relevant to this appeal, in 2012 the corporation passed a resolution naming the owners’ interest of Shirttail Estates as Willie Ray Bridger (“Bridger”) at 32.552583%, Jack F. Owens, Jr. (“Owens”) at 38.75551% and Enoch Denver Boothe (“Boothe”) at 28.691908%. According to Louisiana Secretary of State records, Shirttail Estates’ charter was administratively terminated on April 4, 2015, and no further filings have transpired since that termination. Boothe died on September 16, 2016, and Bridger died in 2021.

Plaintiffs, Shannon Driver and Jason Boothe, (Plaintiffs) the children of Enoch Denver Boothe, filed suit against Jack F. Owens, Jr. (Owens) and Shirttail Estates. Plaintiffs alleged in their suit that Owens conducted Shirttail Estate's business and sold its property without authorization from the shareholders or corporation. Further, Plaintiffs alleged that Owens personally gained from conducting Shirttail Estate's business to the detriment of the corporation and Plaintiffs, as stockholders.

Plaintiffs sought dissolution of Shirttails Estates and compensation from Owens for their share of the profits received by Owens for Shirttails Estates’ business transactions and sale of certain corporate property. A stipulated judgment was entered into by Plaintiffs and Owens granting a preliminary injunction prohibiting the sale of any corporate assets and granting Plaintiffs access to Shirttail Estates’ bank accounts from the time of their father's death. The stipulated judgment also set a hearing on all issues for June 4, 2024, which was continued to July 17, 2024.

After the trial on the merits, the trial court dissolved Shirttail Estates and appointed a liquidator to conduct business on behalf of Shirttail Estates. Further, the trial court rendered judgment in favor of Plaintiffs for $7,965.44 against Owens based on the evidence in the record of certain business transactions and property sales by Owens. Finally, the trial court assessed all costs of the proceedings to Owens. Owens appeals alleging three assignments of error.

ASSIGNMENTS OF ERROR

Owens’ three assignments of error are stated as follows:

1. The court erred to dissolve the corporation. The corporation was sued as a defendant by minority stockholder, who only owned 14+ percent. The plaintiff did not file the necessary derivative action. The plaintiff has no service of process on the defendant corporation. The corporation did not answer the suit. A default judgment was entered against the corporation without a minute entry of a preliminary default being entered into the record. [citation omitted] The default judgment was granted on a rule to show cause.

2. There had been no liquidator appointed. Once appointed, he did nothing. All the tenants left! No electric, no water.

3. The court erred to render judgment against the defendant, Owens.

a) The reasons for judgment reflect a lack of evidence.

b) Everything paid to the corporation went into the corporate account.

c) Even on the exchange deed, the corporation got all benefits, not Owens.

d) The court erred to hold the defendant, Owens, liable for plaintiffs’ portion of the exchange. The corporation, owned by plaintiffs (28.691908%) got the assets of the exchange. The court erred to order the judgment against Owens paid from the corporation assets.

e) If the corporation was to be dissolved, the plaintiffs are only intitled [sic] to their undivided interest.

f) The court erred to order a liquidator, appraisal fee, survey fees, listing and selling fees as costs against defendant. The land does not need to be appraised, listed, or sold. The shareholders had independent offers to purchase that had been accepted.

g) The court erred to cast all costs on defendant, Jack F. Owens, Jr.

STANDARD OF REVIEW

We first note that Owens, in brief, often makes conclusory statements that the trial court's judgment was in error in a specific result, but presents no alleged applicable standard of review nor any argument or evidence to support those statements.

Should Owens’ assertions involve a question of law, we will apply the de novo standard of review as to the “[q]uestions of law, such as the proper interpretation of a statute, are reviewed by this court under the de novo standard of review.” La. Mun. Ass'n v. State, 04-0227, p. 35 (La. 1/19/05), 893 So.2d 809, 836. “When a trial court commits an error of law, the reviewing court is not subject to the manifest error standard and can make an independent determination of the facts from the record on appeal.” Arabie Bros. Trucking Co. v. Gautreaux, 03-0120, p. 7 (La.App. 1 Cir. 8/4/04), 880 So.2d 932, 938, writ denied, 04-2481 (La. 12/10/04), 888 So.2d 846.

Accordingly, we will apply the manifest error standard of review as to the findings of fact by the trial court. Stobart v. State, Dept. of Transp. & Dev., 617 So.2d 880 (La.1993).

MOTION TO STRIKE

Prior to addressing Owens’ assignments of error, we will first discuss Plaintiffs’ motion to strike. Plaintiffs request that any defense or argument Owens makes on behalf of Shirttail Estates be stricken from the record on appeal and dismissed. Plaintiffs maintain that Owens is no longer eligible to practice law in Louisiana. As such, while Owens can properly represent himself, he cannot properly represent the corporation, Shirttail Estates.

Here, Owens and Shirttail Estates were co-defendants in this matter. While we agree that Owens cannot properly represent Shirttail Estates, we find that the allegations by Plaintiffs relate not only to Owens’ individual actions, but also as to those Owens allegedly made on behalf of Shirttail Estates. As such, we find that any argument made by Owens, whether individually or as to those allegedly made on behalf of the corporation, is synonymous and similar, and relevant herein. Thus, we find any error in allowing Owens’ argument in brief on behalf of Shirttail Estates to be harmless.

Additionally, Shirttail Estates was dissolved by the trial court, and in Assignment of Error Number One, we address whether the trial court erroneously dissolved Shirttail Estates. If Owens cannot represent Shirttail Estates, the judgment dissolving the corporation is final. Therefore, we find this argument moot and deny Plaintiffs’ motion to strike.

ASSIGNMENT OF ERROR NUMBER ONE

Owens’ first assignment of error is that the trial court erred in dissolving the corporation. Owens argues in this assigned error that Plaintiffs did not file the necessary derivative action, nor did they serve process on the defendant corporation. Further, Owens stated that the corporation did not answer the suit, and a default judgment was entered against the corporation without a minute entry of a preliminary default being entered into the record and a default judgment was granted on a rule to show cause.

Louisiana Revised Statutes 12:1-1430 states, in pertinent part, the following:

A. A district court may dissolve a corporation in any of the following:

․

(2) A proceeding by a shareholder if any of the following is established:

(a) The directors are deadlocked in the management of the corporate affairs, the shareholders are unable to break the deadlock, and irreparable injury to the corporation is threatened or being suffered, or the business and affairs of the corporation can no longer be conducted to the advantage of the shareholders generally, because of the deadlock.

․

(c) The shareholders are deadlocked in voting power and have failed, for a period that includes at least two consecutive annual meeting dates, to elect successors to directors whose terms have expired.

Our review of the record indicates that Owens conducted business on behalf of Shirttail Estates as if it were his own sole proprietorship. Evidence in the record shows that Owens committed a multitude of ultra vires acts such as exchanging real estate, selling hay, and collecting rental and boat launch fees on behalf of the corporation without receiving corporate permission or approval of his actions. Further, there is evidence in the record that Owens personally benefitted from those acts beyond his power.

Moreover, it is clear from the record that the object for which Shirttails Estates was formed has failed. The record contains no evidence of the corporation filing annual reports, meetings, distributions, or tax returns. The record also establishes that the relationship between Plaintiffs and Owens is irreparable and that Shirttails Estates cannot now operate in manner advantageous to its shareholders. Additionally, the records of the Louisiana Secretary of State reflect that Shirttail Estates’ charter was administratively terminated on April 4, 2015, and no further filings have transpired since that termination.

It is clear to this court that Shirttail Estates no longer functions as a corporation as it exists in name only. There is no evidence in the record that Shirttail Estates conducts business using corporate law. The evidence contained in the record, even Owens’ self-serving and unsupported testimony, shows that Ownes’ actions, without proper approval from other shareholders in his dealing with the corporation's business and assets, was such that Owens appeared to act in his best interest and as a one-person corporation, as the other two original shareholders were deceased.

Finally, as Owens could not represent the corporation, and as no appropriate representative appealed the trial court's judgment dissolving the corporation, the judgment dissolving Shirttail Estates is final.

After a thorough review of the record, we find the record supports the trial court's decision, and therefore, we find no error by the trial court in dissolving Shirttail Estates. Thus, this assignment lacks merit.

ASSIGNMENT OF ERROR NUMBER TWO

Owens’ second assignment of error asserts first that there had been no liquidator appointed, but then argues that once the liquidator was appointed, he did nothing. However, in brief, Owens fails to make any argument regarding the lack of appointment or inaction of a liquidator.

Owens also fails to state what resolution is sought from this assigned error. There is no indication from Owens that he is seeking the appointment of another liquidator, the removal of this liquidator or any specific action to be performed by the appointed liquidator.

Accordingly, we find no merit to this assignment of error.

ASSIGNMENT OF ERROR NUMBER THREE

Owens’ final assignment of error contains seven subsets that delineate how, in Owens’ view, the trial court erred in rendering judgment against him.

Owens first states that the trial court's reasons for judgment reflect a lack of evidence. However, “[A]ppellate courts review judgments, not reasons for judgment.” Bellard v. American Cent. Ins. Co., 07-1335 p. 25 (La.4/18/08), 980 So.2d 654, 671. Appeals are taken from the judgment, not the written reasons for judgment; La. C.C.P. arts. 1918, 2082 and 2083. Thus, Owens’ first issue raised in the assignment of error is without merit.

Owens next asserts that he properly paid the corporation for any and all transactions as the proceeds went into the corporate account. As such, Owens asserts that Plaintiffs should have been awarded assets from the corporation, rather than from him, from those proper exchanges. However, the record shows that Owens presents no evidence to support his self-serving assertions. Contrarily, we find the record contains sufficient evidence supporting the trial court's findings that certain corporate transactions occurred wherein Shirttail Estates should have received funds, but those funds were not deposited into its bank account, and Owens conducted those transactions. As such, this assertion lacks merit.

Next, Owens contends that the trial court erred in ordering a liquidator, appraisal fee, survey fees, listing and selling fees as costs against him. According to Owens, the land does not need to be appraised, listed, or sold because the shareholders had independent offers to purchase that had been accepted.

The trial court found, and as we upheld that finding above, that the corporation could no longer function properly. To sell corporate property in the manner suggested by Owens, the corporation would need to properly conduct business. Additionally, a liquidator, as appropriately appointed in this case, by law must conduct the corporate business properly, as ordered by the trial court, and in doing so the liquidator's duties include that Shirttail Estates’ property must be appraised and listed for it to be properly sold. Thus, we find this contention lacks merit.

Finally, Owens argues that the trial court erred in casting him with costs of the proceedings. “The trial court, in taxing court costs, is given great discretion and may assess those costs in any manner it deems equitable” [citation omitted]. The standard of reviewing assessment of court costs is abuse of discretion.” Bentley v. Fanguy, 09-822, 09-1509, p. 10 (La.App. 3 Cir. 10/6/10), 48 So.3d 381, 389, writ denied, 10-2854 (La. 2/25/11), 58 So.3d 457.

In reviewing the record, there is ample evidence to establish that Owens has been unilaterally conducting the business of Shirttail Estates, without proper corporate authorization. The evidence contained in the record shows that Ownes’ actions, without proper approval from other shareholders in his dealing with the corporation's business and assets, was such as Owens appeared to act on his best interest and that Owens profited at the expense of the shareholders and the corporation. Here, Plaintiffs sought and received a judgment both dissolving the corporation and against Owens, individually, for an amount he owed them through his unilateral conducting of Shirttail Estate's business for his own personal gains. As such, we find the record fully supports the trial court ruling as to Owens’ personal liability and find no abuse of the trial court's discretion in assessing costs to Owens.

DISPOSITION

Jack Owens, Jr. and Shirttail Estates, Inc. raised three assignments of error by the trial court in granting judgment dissolving Shirttail Estates, Inc. and granting judgment against Jack Owens, Jr. in favor of Shannon Driver and Jason Booth as shareholders of Shirttail Estates, Inc. After review, we find no merit to their assignments of error and find no error in the trial court's judgment. That judgment is affirmed. Costs of these proceedings are assessed to Jack Owens, Jr.

AFFIRMED.

FOOTNOTES

1.   Defendant, Shirttail Estates, is sometimes labeled as “Shirt-Tail Estates” or “Shirttails Estates” interchangeably by the parties. We will use Shirttail Estates throughout this opinion for consistency and clarity.

GARY J. ORTEGO JUDGE