Sloane v. Davis

397 So. 2d 1376
CourtLouisiana Court of Appeal
DecidedApril 15, 1981
Docket8079
StatusPublished
Cited by5 cases

This text of 397 So. 2d 1376 (Sloane v. Davis) 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
Sloane v. Davis, 397 So. 2d 1376 (La. Ct. App. 1981).

Opinion

397 So.2d 1376 (1981)

Bryan J. SLOANE, Jr., Plaintiff and Appellant,
v.
Edward Mike DAVIS, d/b/a Tiger Oil Company, Defendant and Appellee.

No. 8079.

Court of Appeal of Louisiana, Third Circuit.

April 15, 1981.

*1377 Dubuisson & Dubuisson, James G. Dubuisson, Opelousas, for plaintiff and appellant.

Camp, Carmouche, Palmer, Barsh & Hunter by A. J. Gray, III, Lake Charles, for defendant and appellee.

Before CULPEPPER, FORET and STOKER, JJ.

CULPEPPER, Judge.

This is an action to enforce an employment contract. Plaintiff, Bryan J. Sloane, Jr., a geologist, seeks to compel his former employer, Edward Mike Davis, d/b/a Tiger Oil Company, an independent oil operator, to assign to him certain overriding royalty payments from the "Mecom prospect". Plaintiff's claim is based on the provisions of a written employment contract made with defendant. Upon joint motion of counsel, the trial of this matter was severed and heard solely on the question of liability under the contract. The question of damages, if any, was to be tried at a later date. After two days of testimony, the district court rendered judgment in favor of defendant and dismissed plaintiff's suit. Plaintiff appeals. We reverse and remand.

The trial judge held the written contract is ambiguous as to the provisions at issue, thus permitting consideration of parol evidence to show the intent of the parties. Moreover, the judge held that even if the contract is not ambiguous, plaintiff cannot recover because the Mecom lease was not acquired as the result of services performed by plaintiff or a co-employee in his office. On appeal, defendant does not contend the contract is ambiguous. He contends plaintiff did not comply with the contract as written.

*1378 On October 5, 1973, plaintiff was hired as a geologist by the defendant, Edward Davis. The terms of the employment contract were provided in a letter agreement signed by plaintiff and defendant. Under the agreement, plaintiff was to receive a minimum salary of $1800.00 per month for a minimum term ending no sooner than December 31, 1974. In addition to the base salary, plaintiff was granted an option to purchase an overriding royalty on any mineral leases acquired by the defendant in certain instances. The pertinent provisions of the October 5, 1973 contract provide:

"Furthermore, employer hereby grants to employee the option of purchasing an overriding royalty on all oil, gas and mineral leases acquired by employer as a result of employee's services or as a result of efforts of other members of the office wherein employee renders his services. Employee's cost of said overriding royalty shall be $10 per prospect.
"The amount of overriding royalty available to employee is described by the following paragraphs:
"(1) On prospects generated by employee he shall be entitled to acquire 1% of 8/8ths overriding royalty.
(2) On prospects generated by any member of South Louisiana Division other than employee, employee shall be entitled to acquire 0.5% of 8/8ths overriding royalty."

In the spring of 1975, plaintiff's employer, Davis, entered into discussions with John Mecom, Sr., concerning oil and gas exploration on property owned by Mecom's family in Cameron Parish, Louisiana. Defendant assigned plaintiff to conduct a geological study of the area to determine the feasibility of the venture. Plaintiff was also instructed by defendant to consult with Mr. Lee Morgan, a geologist in New Orleans working for Mr. Mecom. Plaintiff met with Mr. Morgan in New Orleans and obtained certain geological maps which Morgan had already prepared. These maps designated several oil and gas prospects on the land. Based on this information and on additional geological information prepared by plaintiff, plaintiff made several maps of the subsurface area.

After his geological study was complete, plaintiff submitted a written report to Joe Freeman, his immediate supervisor in the Lake Charles office, recommending that Tiger Oil Company join Mr. Mecom in the drilling venture. After consideration of plaintiff's proposal, which was concurred in by Joe Freeman, Tiger Oil Company and John Mecom entered into a mineral lease on August 14, 1975. Drilling was commenced soon thereafter on one of the prospects and production was obtained.

On March 16, 1976, in a letter agreement signed by plaintiff and defendant, the October 5, 1973 employment agreement was changed. The opening paragraph of the March 16, 1976 agreement provides:

"This letter will supersede and replace that certain Letter Agreement dated October 5, 1973, by and between Bryan J. Sloane, Jr. (hereinafter referred to as `employee') and Edward Mike Davis (hereinafter referred to as `Davis'). All terms and conditions hereinafter set forth shall be effective as of October 5, 1973."

Under the second agreement, plaintiff's salary remained at $1800.00 per month. The conditions necessary to acquire an option to purchase an overriding royalty, however, were changed by the amended contract which now reads in pertinent part as follows:

"Furthermore, Davis hereby grants to employee the option of purchasing an overriding royalty on all oil, gas and mineral leases acquired by Davis as a result of employee's services or as a result of efforts of other members of the office wherein employee renders his services. Employee's cost of said overriding royalty shall be $10 per prospect.
"At any time that over $150 per acre bonus or consideration is paid for acquiring leases, then the overriding royalty amount to be received by employee shall be negotiated between employee and Davis. However, it shall never exceed 1% of 8/8ths. The amount of overriding royalty available to employee is described by the following paragraphs:
*1379 "(1) On prospects generated by employee, he shall be entitled to receive 1% of 8/8ths overriding royalty, so long as the royalty and/or overriding royalty interest (excluding the employee's overriding royalty) shall not exceed a 1/6th total royalty. If Davis gives more than a 1/6th royalty and/or overriding royalty interest, then the overriding royalty interest hereinabove provided for shall be proportionately reduced.
"(2) On any prospect reviewed and interpreted by employee, other than his own original prospects, as defined in paragraph 1 above, located in South Louisiana which, for purpose of this letter, shall embrace an area located on the northern boundaries of Beauregard, Allen, Evangeline, St. Landry, Point Coupee, West Feliciana, East Feliciana, St. Helena, Tangipahoa and Washington Parishes, Louisiana, to the southern boundary of Zone 1, employee shall receive a ½ of 1% of 8/8ths overriding royalty interest. However, any prospect, whether it be self-generated and be deemed the prospect of employee, or any other prospect reviewed and interpreted by employee not being his prospect, shall be sent by registered mail to Davis for his approval by the division manager. Such prospect shall include the terms and conditions of the entire prospect, delineated by section, township and range, or by outline, along with the amount of overriding royalty to be received by employee. Should Davis concur, he shall return a copy to the division manager, appropriately signed, and retain a copy in the Houston Office."

The parties agree it is this agreement, rather than the October 5, 1973 agreement, which is now controlling.

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Related

Browning v. Exxon Corp.
848 F. Supp. 1241 (M.D. Louisiana, 1994)
Boyd v. Martin Exploration Co.
56 B.R. 776 (E.D. Louisiana, 1986)
Sloane v. Davis
433 So. 2d 374 (Louisiana Court of Appeal, 1983)
Duncan v. Paragon Resources, Inc.
417 So. 2d 850 (Louisiana Court of Appeal, 1982)

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Bluebook (online)
397 So. 2d 1376, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sloane-v-davis-lactapp-1981.