Day v. Lide

304 So. 2d 843, 1974 La. App. LEXIS 3397
CourtLouisiana Court of Appeal
DecidedDecember 10, 1974
DocketNos. 12479, 12480
StatusPublished

This text of 304 So. 2d 843 (Day v. Lide) 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
Day v. Lide, 304 So. 2d 843, 1974 La. App. LEXIS 3397 (La. Ct. App. 1974).

Opinion

BOLIN, Judge.

On September 17, 1965, David M. Lide, Sr., and Pel-Star Oil Corporation by written instrument leased to E. E. (Jack) Day approximately 450 acres of farmland in Tensas Parish. On the same day, by a separate but similar instrument, Pel-Star leased to Jerry Keith Crane approximately 440 acres in the same parish. These leases were periodically renewed, the final renewals providing they were to remain in effect through December 31, 1974.

In July, 1973, Lide and Pel-Star assigned all the rentals due them under the leases to Lakegrove Plantation. Each lease provided the lessor was to receive from the lessee one-fourth of the cotton produced from the land and the lessee was to receive the remaining three-fourths. Each lease also granted the lessee the right to sell lessor’s one-fourth interest unless the lessor notified the lessee to the contrary in writing, in which event the one-fourth interest would be delivered to the lessor in kind.

[845]*845From 1965 until 1973 the lessees sold all the harvested crops and remitted the amount due to lessors. In March and June, 1973, for the first time each lessee entered into a “Sale and Purchase Agreement” whereby he attempted to sell the future production of cotton under what is commonly referred to as a “Forward Booking Contract”, to Massony Cotton Company.

In July 1973, Lakegrove Plantation, lessors’ assignee of the cotton rentals under both leases, gave written notice to Crane and Day requesting that the lessors’ rent for 1973 be paid by delivery of the crops in kind. Day and Crane, being faced with conflicting demands, filed these concursus proceedings (later consolidated) and deposited in the registry of the court the warehouse receipts representing the lessors’ one-fourth interest in the cotton.

Following trial on the merits the lower court for written reasons decided Day and Crane sold the lessors’ interest in the cotton crop under the sale and purchase agreements prior to the receipt by them of the written notices advising them that the lessors’ one-fourth interest should be paid in kind. Accordingly, a formal judgment was signed ordering delivery of the cotton receipts to the cotton merchant; that the merchant sell the cotton and pay the proceeds to the lessors or their assigns; and further, rejecting defendants’ reconven-tional demand for damages and cancellation of the leases. Defendants in the con-cursus proceedings appeal. The purchaser of the cotton, Massony Cotton Company, answers the appeal seeking damages under its reconventional demand and asking that the judgment be altered to relieve it from the payment of all costs.

We find the lower court was erroneous in holding lessees had the right to sell lessors’ cotton in the -manner in which they did under the forward booking contract.

The overriding issue, which we think is dispositive of the case, is whether the written lease agreements and sale purchase agreements, without other extrinsic evidence, authorized the lessees to sell the lessors’ portion of the crops where the lessors had given written notice prior to the harvest that they desired to receive their portion of the crops in kind.

Each lease contained the following provision :

“The price and consideration for said lease is:
(a) One-fourth (]4) of the cotton and cottonseed (less only the ginning costs) shall be paid net to lessors each year; Party of the Second Part [lessee] shall pay all expenses in connection with said crops, including fertilizer and poison (but only his proportionate part of the ginning costs); Party of the Second Part is granted the right to sell the cotton and cotton seed to he received by Parties of the First Part [Zeiior-y] as rent as aforesaid, and pay to Parties of the First Part the price received therefor, such sale, however, to be not less than the amount of loan available for said cotton in the event a United States Government loan program shall be in effect; provided, however, that in the event Parties of the First Part wish, for business or tax reasons, to delay the sale of their portion of said cotton they may do so by notifying the Party of the Second Part in writing of their desire to do so, and thereupon the Party of the Second Part shall deliver to Parties of the First Part their one-fourth of the cotton, said cotton to be of average grade and staple.” (Emphasis added)

The Sale and Purchase Agreement was executed by Day on June 6, 1973, and by Crane on March 7, 1973. Each contract was signed by Massony Cotton Company as buyer and contained the following provisions, with the blanks appropriately filled in:

“1. On the terms and conditions and at prices hereinafter stated, the Producer [846]*846and Seller agrees to sell, and the Buyer agrees to buy, all and only the cotton produced by Producer and Seller during the crop year 1973 on approximately-acres situated in -.
“2. This contract is for the sale and purchase of all cotton produced on the above described acreage eligible for the 197 — ■ Government loan as determined by USDA official Government class except any false-packed, water-packed, re-packed, re-ginned or oily cotton. All cotton eligible under this contract must be hand or spindle picked.
“3. Producer and Seller agrees to practice normal, good farming methods in the production and harvesting of the crop, to defoliate before machine picking and to harvest, gin and store as fast as practicable after maturity. Buyer has the privilege of controlling within reason the amount of heat and cleaning equipment to be used in ginning the cotton. Producer and Seller agrees further to cooperate in harvesting, handling and ginning the cotton to avoid overheating, overmachining and poor preparation.”

It is significant to note that prior to signing the booking contract in March, 1973, Crane presented Massony with a copy of his lease for review. Massony also knew that Day leased his land under a similar contract.

During the course of trial objection was made to the admissibility of evidence tending to show the intent of the parties to the contracts or to in any way enlarge or contradict the written provisions. The objections were referred to the merits and the evidence was admitted subject to the objection. We hold the objections were valid and should have been sustained. The applicable law is Louisiana Civil Code Articles 1901, 1945 et seq., relating to contracts and the rules for their interpretation.

We find no ambiguity in the lease contracts. The fact that the parties referred to “cotton and cottonseed less only the ginning costs” rather than “cotton crops or standing crops” indicates a clear intention that the parties were referring to “harvested cotton”. The fact that each contract contained the word “sale” rather than “contract to sell”, “sale of a future interest” or “sale of standing crops” indicates an intention to authorize a sale of “harvested cotton”.

Even though lessors were not parties to the booking contracts, the provisions of these contracts may be considered in determining the intent of the lessees. These contracts were clearly not a sale of cotton or a sale of a future interest but by their terms “the producer and seller agrees to sell and the buyer agrees to buy”. In order for a contract to constitute a sale the parties must intend that title shall pass immediately; otherwise it will be considered a contract to sell. Plaquemines Equipment & Machine Co., Inc. v.

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Cite This Page — Counsel Stack

Bluebook (online)
304 So. 2d 843, 1974 La. App. LEXIS 3397, Counsel Stack Legal Research, https://law.counselstack.com/opinion/day-v-lide-lactapp-1974.