Louisiana Power & Light Co. v. Town of Arcadia

• Decision Date: 15 March 1954
• Docket Number: Civ. A. No. 4151.
• Citation: 119 F. Supp. 818
• Court: U.S. District Court — Western District of Louisiana
• Parties: LOUISIANA POWER & LIGHT CO. v. TOWN OF ARCADIA.

119 F. Supp. 818

LOUISIANA POWER & LIGHT CO. v. TOWN OF ARCADIA.

Civ. A. No. 4151.

United States District Court W. D. Louisiana, Shreveport Division.

March 15, 1954.

Goff & Caskey, Arcadia, La., Monroe & Lemann, New Orleans, La., Theus, Grisham, Davis & Leigh, Monroe, La., for plaintiff.

Smith, Risinger & Shuey, Shreveport, La., for defendant.

DAWKINS, Jr., Chief Judge.

Tried to the court, the action is for a declaratory judgment¹. Jurisdiction exists².

Plaintiff is a public service corporation. On March 1, 1951, pursuant to municipal ordinances regularly adopted, defendant granted plaintiff a franchise contract to furnish water to the town. Included, and presented here for interpretation, was the following proviso:

"We will supply to the Town of Arcadia, without charge, water for its sewage disposal systems, its municipal buildings, drinking fountains, and the cemetery. Should the Town waste water supplied without charge as aforesaid, we will give notice, in writing, specifying the waste complained of; and, if within thirty (30) days from the date of such notice the Town has not remedied such waste, or has failed within such period to commence and diligently prosecute steps to prevent such waste, we will thereafter be entitled to charge the Town for the amount of water wasted on the basis of the customary rate. In addition, we will supply, without charge, water for the operation of the present sixty-four (64) four-inch and fourteen (14) two-inch fire hydrants in the Town of Arcadia; and, for each additional twenty (20) water customers which we obtain in excess of our present five hundred and seventy-five (575), we will supply and install the necessary lines, furnish, install, and supply water for the operation of one (1) additional four-inch fire hydrant. The installation of such additional fire hydrants is in no way a limitation upon the provision regarding fire classifications as set out in paragraph (1) above. Also, we will furnish and deliver water, without charge, to the proposed city natatorium and any city parks, when and if they are built, in sufficient quantity, quality, and volume to maintain reasonable operation of these facilities and meet all requirements of the public health authorities." (Emphasis supplied.)

The critical language is that emphasized in the quotation, for a dispute as to its meaning brought about this controversy.

In late 1952, defendant began detailed planning for a public swimming pool, tentative plans having originated some time earlier. Later, it advertised for construction bids in accordance with approved plans and specifications, providing for a so-called "flow-through" type of operation. This meant that the only method for changing water was by a continuous flow of fresh water through it.

State Board of Health regulations³ affecting public swimming pools require that, for sanitation purposes, (1) in "flow-through" pools there must be a complete change of water at least twice each twenty-four hours, or (2) if this method is not used, an adequate filtration and disinfection system must be installed and utilized.

Defendant's pool has a water volume capacity of some 200,000 gallons. If water is furnished on a "flow-through" basis, about 400,000 gallons daily would be needed. Plaintiff's daily water plant capacity is 500,000 gallons and daily normal consumption by the town is 350,000 gallons. Both parties agree, therefore, that it is impossible for plaintiff to supply water for the pool on a "flow-through" basis, and still fulfill the town's normal needs. Consequently, a filtration plant must be installed at the pool, if it is to operate.

The dispute as to the extent of plaintiff's obligations in this respect having arisen during construction, the parties agreed, without prejudice to the rights of either, and in order to minimize damages which will accrue to the loser, that necessary plumbing for future installation of the water purifying system be "stubbed-in" before the pool was completed. This was done.

The system must be installed and it will cost about $12,000. The question is: Under the contract, who must pay for it?

Each insisting that the other is liable for this necessary expenditure, the parties have advanced their respective arguments with much force.

Confronted, as we are, with a contract that is virtually silent on the particular point at issue, we look for guidance to rules of interpretation laid down by the Louisiana Civil Code and by State jurisprudence.

Contracts must be construed as a whole, not by clauses, sentences or paragraphs taken from context⁴. Their meanings should be interpreted in the light of conditions and circumstances existing at the time, and the parties' intentions are to be gained from all parts⁵.

A fairly recent Louisiana Supreme Court decision⁶ used this language:

"When courts are called upon to interpret written instruments purporting to evidence obligations, if any doubt arises, they look beyond the mere wording of the instrument itself and endeavor to ascertain what was the true intent of the parties, for it is the intent of the parties which determines whether an obligation was assumed.

"The Civil Code, under the heading `Of the Interpretation of Agreements,' beginning with article 1945, prescribes the general rules for the interpretation of agreements. In article 1945 it is provided:

"`That courts are bound to give legal effect to all such contracts according to the true intent of all the parties,' and:

"`That the intent is to be determined by the words of the contract, when these are clear and explicit, and lead to no absurd consequence.

"`That it is the common intent of the parties, that is, the intention of all, that is to be sought for; if there was a difference in this intent, there was no common consent, and consequently no contract.'

"Article 1950 reads as follows:

"`When there is anything doubtful in agreements, we must endeavor to ascertain what was the common intention of the parties, rather than to adhere to the literal sense of the terms.'" (Emphasis supplied.)

Contracts should not be construed so as to impose absurd or impossible conditions upon either of the parties. This is a familiar rule recently reiterated⁷ by the Louisiana Supreme Court:

"In the case of Rolland's Heirs v. McCarty, 19 La. 77, decided in 1841, it was held by this court that `The court will not presume, that parties make use of words in their contracts to which no meaning is attached by them. Some effect is to be given to every word if possible; and but rarely will the court reject words or phrases in a contract as surplusage'. In Clay v. Ballard, 9 Rob. 308, 41 Am.Dec. 328, decided in 1844, this court held that `In the interpretation of a contract, it will not be presumed that either party intended to impose an absurd or impossible condition'.

"The general rule announced in the above cited cases

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