Wilson Oil Co. v. Central Oil & Supply Corp.

557 So. 2d 753, 1990 WL 18574
CourtLouisiana Court of Appeal
DecidedFebruary 28, 1990
Docket21271-CA
StatusPublished
Cited by4 cases

This text of 557 So. 2d 753 (Wilson Oil Co. v. Central Oil & Supply Corp.) 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
Wilson Oil Co. v. Central Oil & Supply Corp., 557 So. 2d 753, 1990 WL 18574 (La. Ct. App. 1990).

Opinion

557 So.2d 753 (1990)

WILSON OIL COMPANY, INC., Plaintiff-Appellant,
v.
CENTRAL OIL & SUPPLY CORP., Roland Carter, and Billy R. Wollerson, Defendants-Appellees.

No. 21271-CA.

Court of Appeal of Louisiana, Second Circuit.

February 28, 1990.
Rehearings Denied March 29, 1990.
Writs Denied May 25, 1990.

Smith, Taliaferro, Seibert, Boothe & Purvis, Jonesboro by V. Russell Purvis, for plaintiff-appellant.

Kneipp & Hastings, Monroe by Donald L. Kneipp, for defendants-appellees, Cent. Oil & Supply and Billy R. Wollerson.

Percy A. Ford, Jr., West Monroe, for defendant-appellee, Roland Carter.

*754 Before MARVIN, SEXTON and NORRIS, JJ.

MARVIN, Judge.

In this action that arose when a lessee and gasoline retailer (Wollerson) and his lessor (Carter) mutually agreed in 1987, after a two-year relationship, to cancel a 1985 eight-year lease of the service station property, Wilson Oil Co., Inc., Wollerson's supplier of gasoline, appeals a judgment rejecting its demands which included the value of pumps, tanks and other improvements it installed in and on the leased premises under its verbal agreement to supply Wollerson with gasoline and other products.

The primary defendant is Central Oil & Supply Corporation, a gasoline supplier and competitor of Wilson, who paid Wollerson $322,000 for his business (inventory and movable furnishings) and became the lessee and operator of the station in 1987 under a new five-year lease with Carter for monthly rent that was about $500 higher than Wollerson had been paying Carter.

The trial court found that Wilson's verbal agreement with Wollerson to install the equipment necessary to sell its gasoline failed to specify a definite term, contrary to Wilson's argument that a "10-year term" was agreed to or was "customarily" contemplated in such a supply agreement.

Central stipulated it owed Wilson $7,312 for the value of gasoline in the underground tanks when it became the operator-lessee of the station in 1987. The judgment awarded Wilson this amount. Wilson seeks to increase the judgment by its lost profits and its expense in installing the necessary equipment on and in the leased premises.

We amend to increase the judgment by $23,000, which we find is the fair value of the underground tanks that Central agreed in its contract with Wollerson to pay Wilson.

We affirm the judgment as amended.

FACTS

In early 1985 Carter agreed to lease the undeveloped land to Wollerson and to finance the construction of improvements for a gas station and convenience store on Interstate Highway 20 to be called Billy's Gas and Go. On May 15, 1985, Carter and Wollerson signed an eight-year lease, effective July 1, 1985. Notice of the lease was filed in the public records on May 16, 1985. Construction was completed and the business opened on July 1, 1985.

Wollerson negotiated with several bulk suppliers, including Wilson and Central, before he made a "handshake" verbal agreement with Wilson to buy gasoline exclusively from Wilson in return for Wilson's installing the necessary equipment at the station.

Wollerson's lease with Carter clearly stated that any improvements made by Wollerson would be owned by Carter when the lease terminated. After concluding his negotiations with Wilson, through Mike Wilson, who was the principal owner and executive officer of the corporation, Wollerson introduced Mike Wilson to Carter in Carter's office. Carter testified that, during a 10-15 minute meeting, he effectively explained to Wilson that

Anything that is put on the property, except the underground tanks, belongs to me, and you need to understand that in making your deal with Wollerson. If you remove the tanks, you must put the property back in the condition it was in before the tanks were installed.

Carter testified that he disclaimed the tanks, notwithstanding the provision in the recorded lease that he would own all equipment installed on the leased premises, because he understood the tanks were hazardous when empty.

Wilson testified that Carter said nothing about ownership of the equipment at this meeting and merely gave his approval to Wilson's agreement with Wollerson. Wollerson neither recalled nor denied that Carter claimed ownership of any of the equipment.

Mike Wilson said he "understood from the outset" the agreement to supply products to Wollerson would endure for a ten-year term. Wollerson testified that no *755 term was discussed until June 1986 when he offered to buy the equipment Wilson had installed because he had had such a profitable first year.

According to Wollerson, Wilson declined his offer to buy the equipment because Wollerson had "leased" the equipment from Wilson for ten years as a part of the supply agreement. Wollerson said he attempted to explain to Wilson that he could not have a ten-year lease with Wilson because he only had an eight-year lease with Carter. Wilson did not recall the details of this conversation, but acknowledged that Wollerson sought several times to buy the equipment, believing that his sale of the business to Central would be facilitated if Wollerson owned the equipment.

After his conversation with Wollerson, Wilson drafted and presented to Wollerson and Carter in June 1986 a "purchase agreement" under which Wollerson and Carter would agree to use Wilson as the exclusive supplier for the station for ten years beginning July 1, 1985, in return for Wilson's installation of the equipment at the station. Under this proposed written agreement, Wilson would "own" the equipment it had installed. Wollerson and Carter declined to sign Wilson's written proposal.

On May 1, 1987, Wollerson and Central signed an agreement whereby Central would buy Wollerson's business, assets and inventory. The equipment Wilson had installed in 1985 was expressly excluded from the purchase agreement and from the Wollerson-Central sale that was executed May 20, 1987. Upon joining with Wollerson in formally cancelling the 1985 eight-year lease, Carter executed a new lease with Central Oil. This lease also provided that any improvements made by the lessee would belong to Carter.

Before Central acquired Wollerson's business, Central's CEO, Hardeman Cordell, told Wilson's CPA, Maurice Linam, that Central would pay for the equipment Wilson had installed at the station, subject to credits that Central claimed from dealings with Wilson Oil at a location in Ferriday, La. Cordell asked for, and Linam provided at the Wollerson-Central sale closing, invoices to Wilson totaling about $137,000 that represented what it cost Wilson to purchase and install the equipment at Wollerson's station and the value of the gasoline in the underground tanks at the time of the sale by Wollerson to Central. About ten days later, Central's attorney wrote to Wilson's attorney:

Confirming our telephone conversation of Friday, May 22, 1987, please be advised that Central Oil & Supply Corporation stands ready to pay Wilson Oil Company the fair value of the petroleum distribution equipment located at Billy's Gas and Go as long as it receives an equivalent credit for its petroleum distribution equipment which was and/or is being used by Wilson Oil Company at the convenience store formerly known as "Wagoner's Stop'N Go", Ferriday, Louisiana. It is my understanding that Mike Wilson has furnished invoices totaling approximately $137,000.00 representing the cost of the petroleum distribution equipment at Billy's Gas and Go.

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Related

Beckham v. Hibernia National Bank
665 So. 2d 706 (Louisiana Court of Appeal, 1995)
Wilson Oil Co. v. Central Oil & Supply Corp.
563 So. 2d 885 (Supreme Court of Louisiana, 1990)

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557 So. 2d 753, 1990 WL 18574, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wilson-oil-co-v-central-oil-supply-corp-lactapp-1990.