Angelle v. Energy Builders Co., Inc.

496 So. 2d 509, 1986 La. App. LEXIS 7863
CourtLouisiana Court of Appeal
DecidedOctober 15, 1986
Docket85 CA 0796
StatusPublished
Cited by4 cases

This text of 496 So. 2d 509 (Angelle v. Energy Builders Co., Inc.) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Angelle v. Energy Builders Co., Inc., 496 So. 2d 509, 1986 La. App. LEXIS 7863 (La. Ct. App. 1986).

Opinion

496 So.2d 509 (1986)

Lennie ANGELLE
v.
ENERGY BUILDERS COMPANY, INC., et al.

No. 85 CA 0796.

Court of Appeal of Louisiana, First Circuit.

October 15, 1986.

*510 W. Glenn Soileau, Breau Bridge, for plaintiff-appellant Lennie Angelle.

E.L. Henry, Baton Rouge, for defendant appellant Walter E. Heller and Co. Southeast Inc.

Before LOTTINGER, SHORTESS and CARTER, JJ.

SHORTESS, Judge.

This suit arose from a dispute over a lease agreement. Late in 1981, Lennie Angelle (plaintiff), a contractor, became interested in obtaining a Low Ground Pressure (LGP) tractor for clearing swamp land. An LGP tractor is designed to do work in unstable and muddy terrain. The machine plaintiff wanted had to be equipped with a KG blade, which is used for shearing and cutting purposes. He had an opportunity to do some swamp work for Supreme Contractors, but before he could realistically bid on the work, he needed equipment that he did not have, namely, an LGP tractor with a KG blade. He discovered that Energy Builders Company, Inc., (EBCO) had such a tractor which it wanted to sell. Plaintiff and an EBCO official flew to North Carolina and examined the machine. Plaintiff concluded that if it were equipped with a KG blade it would suit his needs.

Plaintiff had on other occasions rented heavy equipment from General Leasing Services, Inc. (GLS). He contacted GLS which agreed to purchase the equipment from EBCO and lease it to plaintiff. On November 10, 1981, GLS purchased the LGP tractor, a winch, an original angle blade, and KG blade from EBCO for $65,000.00. On November 16, 1981, Angelle Backhoe Rentals and GLS executed a contract by which plaintiff leased the equipment from GLS for a three-year term at $2,988.00 per month. The lease absolved GLS of any warranty obligations and of any liability for EBCO's failure to deliver the described merchandise.[1]*511 GLS then assigned its rights under the lease to one of its creditors, Walter E. Heller & Company Southeast, Inc. (Heller); that assignment, dated November 24, 1981, contains the following germane language:

BORROWER [GLS] does hereby sell, assign, transfer and set over unto HELLER all of its right, title and interest in and to the above described lease contract, together with all the rents, issues and profits due and to become due under said lease contract, subject to the following:
SO LONG as the BORROWER is not in default under the terms of the LOAN AGREEMENT, NOTE and MORTGAGE referred to above, or under any other notes or mortgages held by HELLER, BORROWER shall continue to collect the rents and profits from the lease contract for the benefit of HELLER and as provided in the LOAN AGREEMENT.

EBCO delivered the equipment to plaintiff in late January, 1982. The KG blade was not included in this initial shipment, but, according to his testimony, plaintiff allowed the haulers to leave the LGP tractor with him because they promised that the blade was on another truck and would arrive later. Eventually, a KG blade was sent to plaintiff, but he refused to accept it because it did not fit the LGP tractor. Plaintiff notified GLS that he had not received the blade he needed, and it in turn contacted EBCO, which began attempts to locate an appropriate blade. Although plaintiff never took delivery of a satisfactory KG blade, he made sporadic payments to GLS totaling, he contends, $21,253.00.

In February, 1983, plaintiff filed suit for damages against GLS, EBCO, and the EBCO official, alleging that the failure to deliver the correct KG blade was a breach of contract. Apparently only GLS was served, and by the summer of 1982 it was involved in reorganization under the jurisdiction of the bankruptcy court. A plan submitted by GLS allowed Heller to enforce the lease and assignment agreements. Heller intervened in plaintiff's suit, praying for cancellation of the lease contract and damages for nonpayment. Plaintiff then amended his petition to make Heller a defendant and asked that the $21,253.00 in payments be refunded. Thus, plaintiff and Heller were the only parties before the trial court.

The trial court rendered judgment denying both Heller's claims in intervention and plaintiff's claims against Heller. It found that the warranty waiver did not relieve GLS of its obligation to deliver the equipment plaintiff had ordered and that there had never been a binding contract of lease between plaintiff and GLS because the appropriate KG blade was never delivered. Plaintiff's demand against Heller for the payments made to GLS was also dismissed. Both parties have appealed.

EXISTENCE OF A LEASE CONTRACT

The trial court reasoned that no contract of lease was perfected between GLS and plaintiff because the KG blade, an integral and essential part of the thing leased, was never delivered. "Lease or hire is a synallagmatic contract, to which consent alone is sufficient." LSA-C.C. art. 2669. "[T]hree things are necessary to the perfection of a lease: the thing, the price, and the consent." S. Litvinoff, Smith's Materials on the Louisiana Law of Sales and Leases 468 (1978); LSA-C.C. art. 2670. Delivery of the thing is not essential to the perfection of the contract, although delivery is among the obligations of the lessor. LSA-C.C. art. 2692. The November 16, 1981, agreement between plaintiff and GLS contained all the elements required, and we find that it was a perfected contract of lease. Our remaining inquiry must determine the rights of the parties and their assigns under this lease.

PLAINTIFF'S LIABILITY TO HELLER

To determine Heller's right to receive rental payments under the lease we must determine GLS's rights thereunder. The crux of Heller's position is that GLS validly waived all lessor warranties; if GLS made no warranties, the fact that plaintiff never received the KG blade does not relieve plaintiff of his obligation as lessee to make *512 rental payments. Heller cites Louisiana National Leasing Corporation v. ADF Service, Inc., 377 So.2d 92 (La.1979), as support for its argument. In that case, the lessor of a defective photocopying machine sued its lessee for nonpayment of rent. The lease provided that lessor made no warranties and that no defect in the equipment would relieve lessee of the obligation to pay rent. The Supreme Court, at p. 95, ruled that the implied warranty of fitness could be renounced and that "since it is not expressly or impliedly prohibited by law to waive implied warranties by disclaiming liability for vices and defects in the leased object while retaining the right to collect rentals for the entire term of the lease, it is not against public policy."

In Louisiana National Leasing the lessee had taken possession of the photocopying machine and used it without trouble for three months before it began to malfunction. In the instant case, plaintiff never received a very essential part of the equipment that the lessor agreed to provide. Without the KG blade, plaintiff had no need for this type of tractor. The trial court found that the KG blade was never delivered. We cannot say that this finding was clearly wrong. This failure of delivery meant that plaintiff never acquired peaceable possession of the thing leased. LSA-C.C. art. 2692. It is one thing to permit a lessee and lessor by convention to renounce the lessor's implied warranties against defects and unfitness; it is quite another to permit them to waive the lessor's obligation to deliver and thus avoid his duty to cause the lessee to be in peaceable possession.

In Louisiana National Leasing,

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Bluebook (online)
496 So. 2d 509, 1986 La. App. LEXIS 7863, Counsel Stack Legal Research, https://law.counselstack.com/opinion/angelle-v-energy-builders-co-inc-lactapp-1986.