Grezaffi v. Smith
1994 WL 278412, 1994 La. App. LEXIS 2052, 641 So.2d 210 (1994)
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Rule of Law:
A threat to do an act that a person has a legal right to do, such as opposing a zoning application, does not constitute duress sufficient to vitiate consent and render a contract voidable.
Facts:
- R. Craig Smith entered into a purchase agreement with Luke J. Grezaffi for a parcel of land upon which Smith planned to build an elderly housing complex.
- Smith's project required that the property purchased from Luke Grezaffi be rezoned by the city.
- Glenn Edward Grezaffi, Luke's brother, owned property adjacent to the parcel Smith was purchasing.
- Glenn Grezaffi and his sister informed Smith that they would use their influence to oppose the rezoning application for his project unless Smith also agreed to purchase Glenn's adjacent property.
- Believing his project would fail without the rezoning, Smith entered into a purchase agreement with Glenn Grezaffi on June 16, 1988, for his 2.536-acre tract for $60,864.00.
- The purchase agreement between Smith and Glenn Grezaffi was contingent on Glenn's property being rezoned 'R-4,' which occurred on August 9, 1988.
- Glenn Grezaffi also secured a commitment from his bank to release the existing mortgage on his property upon the sale to Smith.
- Smith subsequently refused to execute the act of sale for Glenn Grezaffi's property on the agreed-upon closing date of September 1, 1988.
Procedural Posture:
- Glenn Edward Grezaffi filed a suit for specific performance against R. Craig Smith in the 18th Judicial District Court (a trial court).
- Smith filed an exception of improper venue, which the trial court overruled.
- On appeal by Smith, an intermediate appellate court reversed the venue ruling.
- The case was transferred to the 19th Judicial District Court.
- Smith filed an answer raising the defense of duress.
- Grezaffi filed a motion for summary judgment, which the trial court granted.
- Smith's motion for a new trial was granted, but on rehearing, the trial court again entered judgment in favor of Grezaffi.
- Smith (appellant) appealed the trial court's grant of summary judgment to the Louisiana Court of Appeal, First Circuit, with Grezaffi as the appellee.
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Issue:
Does a party's threat to exercise their legal right to oppose a real estate zoning application constitute duress sufficient to vitiate the consent of another party to a separate purchase agreement?
Opinions:
Majority - Carter, Judge
No. A threat to exercise a legal right does not constitute duress sufficient to vitiate consent to a contract. The court reasoned that consent is only vitiated by duress if it results from a threat that causes a reasonable fear of unjust and considerable injury. According to LSA-C.C. art. 1962, the threat of doing a lawful act or exercising a right does not constitute duress. As an adjacent landowner, Glenn Grezaffi had a legal right to oppose the rezoning of the property Smith was purchasing from his brother. Therefore, informing Smith that he would exercise this right was not an improper threat, and the economic pressure Smith felt was not the type of duress that could invalidate the purchase agreement he signed.
Analysis:
This case clarifies the doctrine of economic duress within Louisiana contract law, distinguishing between improper threats and legitimate, hard-nosed bargaining. It establishes that leveraging one's legal rights, even if it places another party at a significant disadvantage, does not rise to the level of duress. The decision reinforces the principle that courts will uphold contracts even when one party felt pressured, provided the pressure did not stem from an unlawful act or threat. This precedent limits the scope of the duress defense, requiring future claimants to demonstrate that the threat they faced was to do something illegal or legally unjust, not merely something financially disadvantageous.
