SOUTHERN CASING OF LA., INC. v. Houma Avionics, Inc.

809 So. 2d 1040, 2001 WL 1151076
CourtLouisiana Court of Appeal
DecidedSeptember 28, 2001
Docket2000 CA 1930, 2000 CA 1931
StatusPublished
Cited by32 cases

This text of 809 So. 2d 1040 (SOUTHERN CASING OF LA., INC. v. Houma Avionics, 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
SOUTHERN CASING OF LA., INC. v. Houma Avionics, Inc., 809 So. 2d 1040, 2001 WL 1151076 (La. Ct. App. 2001).

Opinion

809 So.2d 1040 (2001)

SOUTHERN CASING OF LOUISIANA, INC.
v.
HOUMA AVIONICS, INC.
Houma Avionics, Inc.
v.
Southern Casing Of Louisiana, Inc.

Nos. 2000 CA 1930, 2000 CA 1931.

Court of Appeal of Louisiana, First Circuit.

September 28, 2001.

*1042 Timothy Ellender, Houma, Counsel for Appellee Southern Casing of Louisiana, Inc.

Joseph Bartels, Defendant/Appellant, New Orleans, Counsel for Appellant Houma Avionics, Inc.

Before: GONZALES, KUHN, and CIACCIO[1], JJ.

KUHN, J.

This appeal arises out of an informal business arrangement entered into by Southern Casing of Louisiana, Inc. and Houma Avionics, Inc. Pursuant to the arrangement, Southern Casing constructed an airplane hangar on property that Houma Avionics leased from the Houma/Terrebonne Airport Commission. Southern Casing also paid to have two fuel tanks and their pumping systems installed on the leased property. For a number of years, the parties shared occupancy of the hangar and the use of the tanks. Ultimately, the parties had a dispute over who owned the hangar and tanks, and Houma Avionics demanded that Southern Casing pay rent for its continued occupancy of the hangar. As a result, Southern Casing removed its aircraft from the hangar and filed a petition for judicial sequestration, asserting its ownership claim to the hangar, tanks and pumping systems.[2] Houma Avionics answered *1043 the sequestration suit and reconvened urging its ownership claims and asserting allegations of breach of contract, fraud, and unjust enrichment. Also, in a separate suit, Houma Avionics filed a petition for declaratory judgment seeking to be declared owner of the items in question. Upon Houma Avionics' motion, the suits were consolidated for trial. Southern Casing later amended its petition to allege that Houma Avionics' actions had caused it monetary damage.

In response to the petition for declaratory judgment, the court declared Houma Avionics to be the owner of the hangar[3] but also ordered that Houma Avionics pay $114,100, together with legal interest from August 14, 1998, to Southern Casing. The amount represented the trial court's determination of the value of the hangar at the time of trial, plus an award of interest from the date of the petition for judicial sequestration. The court also declared that at the time the action was instituted, Houma Avionics did not own either of the two fuel tanks. The court recognized, however, that ownership of the aviation gas fuel tank was later conveyed to Houma Avionics.[4]

In response to the petition for judicial sequestration, the trial court ruled in favor of Southern Casing and against Houma Avionics, declaring that at the time the action for judicial sequestration was instituted, Southern Casing was the owner of the two fuel tanks and pumps. This judgment also recognized that after the suit was filed, Houma Avionics purchased the aviation gas fuel tank from Southern Casing and has, thereby, become owner of that tank.[5] The judgment denied the claims asserted by Houma Avionics in its reconventional demand.

Houma Avionics has appealed these judgments. With respect to the judgment on the action for declaratory judgment, we vacate the portion of the judgment that declares that Houma Avionics is the owner of the hangar and the portion that orders Houma Avionics to pay $114,100, with legal interest from August 14, 1998, to Southern Casing. We affirm the provisions of the judgment addressing ownership of the tanks and pumps, and remand the matter for further proceedings to determine ownership of the hangar.

With respect to the judgment on the action for judicial sequestration, we affirm that part of the judgment declaring Southern Casing to be the owner of the two fuel tanks and pumps at the time the action *1044 was instituted. We also affirm that part of the judgment recognizing that Houma Avionics later purchased the aviation gas fuel tank. We vacate that part of the judgment denying Houma Avionics' claim for unjust enrichment but otherwise affirm the denial of Houma Avionics' claims raised in its reconventional demand. We remand this matter for further proceedings to address ownership of the hangar and to reconsider Houma Avionics' claims for unjust enrichment.

I. FACTUAL AND PROCEDURAL BACKGROUND

Houma Avionics, a company owned and operated by James Graves, engages primarily in the installation and repair of radios and other aviation equipment. Until 1992, Houma Avionics had operated its business on its leasehold without the use of an airplane hangar. During May of 1992, Graves learned that Southern Casing was interested in leasing property from the Airport Commission for the purpose of constructing a hangar. Graves also learned that Southern Casing's bid had been rejected by the commission.[6]

Southern Casing was controlled and managed by Michael X. St. Martin. Graves had previously performed avionics repair work on St. Martin's airplanes and he also knew Southern Casing's pilot, Lloyd Geist. At some point, Graves and Geist discussed the possibility of entering into a business agreement whereby an aircraft hangar would be built on Graves' leasehold. According to Graves, he had been contemplating constructing a hangar on his leasehold and he believed that if a larger hangar were built it could accommodate the interests of both Southern Casing and Houma Avionics. Graves understood that Southern Casing wanted private hangar space for the storage of St. Martin's airplanes and the ability to obtain fuel at less than retail cost. Since Houma Avionics was a fixed-based operator (FBO), it was licensed to store and sell aircraft fuel. As of that time, however, Houma Avionics did not have storage tanks on its leasehold and had not been selling fuel.

Geist testified that when he first spoke with Graves, he understood that Graves was proposing that both parties could benefit from a shared arrangement. Southern Casing would not have to pay rent to the airport commission if it built on the property leased by Graves and Graves would have a hangar in which he could conduct business out of the weather. Geist testified that he was not initially interested in the proposal because he understood St. Martin was interested in operating his own facility. Geist explained, however, that Graves continued to pursue the deal. According to Geist, Graves ultimately proposed he would pay all utilities and insurance expense, obtain all building permits, sell fuel to Southern Casing at cost, and pay a fuel flowage fee to Southern Casing on each gallon of fuel sold to third parties. In exchange, he expected Southern Casing to incur the expense of building the hangar and installing the fuel facilities.

Graves and Geist were the primary persons involved in discussing the terms of the business arrangement. But at some point prior to or during the construction of the hangar, St. Martin, Geist, Graves, and St. Martin's accounting personnel met to discuss the terms of the agreement. St. Martin testified that Graves wanted Southern Casing to transfer ownership of the hangar and tanks to him at a later date for *1045 no additional consideration. St. Martin testified that the meeting ended without an agreement regarding ownership and that no documents were executed regarding the terms of an agreement. Despite the parties' failure to reach an agreement regarding ownership, the construction of the hangar and installation of the tanks was not halted.

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Cite This Page — Counsel Stack

Bluebook (online)
809 So. 2d 1040, 2001 WL 1151076, Counsel Stack Legal Research, https://law.counselstack.com/opinion/southern-casing-of-la-inc-v-houma-avionics-inc-lactapp-2001.