Little v. Haik

• Decision Date: 04 May 1964
• Docket Number: No. 46910,46910
• Citation: 163 So.2d 558,246 La. 121
• Parties: Sterling E. LITTLE and Raymond B. Hayes v. Robert G. HAIK.
• Court: Louisiana Supreme Court

Page 558

163 So.2d 558

246 La. 121

Sterling E. LITTLE and Raymond B. Hayes v. Robert G. HAIK.

No. 46910.

Supreme Court of Louisiana.

May 4, 1964.

Robert Louis Carruth, New Orleans, for defendant and appellant.

Cobb & Wright, Joseph V. Ferguson, II, New Orleans, for plaintiffs and respondents.

McCALEB, Justice.

This is a suit for enforcement of an oral agreement of joint adventure allegedly confected by plaintiffs and defendant for the purpose of acquiring certain oil, gas and mineral leases. The plaintiffs, Little and Hayes, are consulting geologists and the defendant, Haik, is an attorney-at-law. The petition alleges, in substance, that Haik proposed to Little during October, 1958 that they buy leases for their joint account; that Little, after consulting Hayes and obtaining his approval, reached an agreement with Haik whereby the latter was to purchase mineral leases in his name for the joint account of the parties affecting tracts in Iberia and St. Martin Parishes which plaintiffs had investigated and found to be suitable geologically for mineral exploration; that, in accordance with this agreement, Haik acquired certain leases embracing lands situated in Township 11 South, Range 10 East, and Township 12 South, Range 10 East, in the aforesaid parishes; that Haik sold the leases at a profit and, subsequently, reacquired them and that he has refused to recognize plaintiffs' interests in the leases and to render an accounting of his trust. Plaintiffs prayed that Haik be ordered to convey to them a 2/3 interest in the mineral leases which stood in his name at the date the suit was filed and they also demanded an accounting for the profits he had made under the agreement. In addition, they obtained a rule nisi for defendant to show cause why a preliminary injunction should not issue, restraining defendant from transferring or encumbering his interest in any of the leases he had previously acquired.

In the alternative, plaintiffs sued for breach of contract alleging that they had incurred expenses and had devoted considerable time in making surveys, core analyses, etc.; that the time and scientific knowledge they had imparted was worth $28,500 and that they were entitled to recover the total amount of $29,208.32 as damages.

Further in the alternative, plaintiffs averred that, in any event, they were entitled to recover the amount of $29,208.32 on a quantum meruit for professional services rendered and the expenses they had incurred in connection with the acquisition of the leases.

In response to the rule nisi (which is, of course, a summary proceeding) defendant filed exceptions of want of interest and no cause of action accompanied by his answer, in which he denied all and singular the claims of plaintiffs respecting the existence of a joint adventure to acquire mineral leases. Under his exception of no cause of action, defendant alleged that plaintiffs were seeking to establish title to and an interest in immovable property and that they were precluded from proving any such interest or title by parol evidence.

The exceptions were overruled by the trial judge. This was correct since plaintiffs had alleged in their alternative demand, based on a quantum meruit for services rendered and monies advanced, a cause of action provable by parol evidence.¹ Thereafter, on trial of the merits, parol evidence was admitted to prove plaintiffs' allegations of a joint adventure to acquire the mineral leases without further objection by defendant. However, defendant took the witness stand and denied the existence of the asserted verbal agreement.

After hearing the evidence, the district judge found that plaintiffs had carried the burden of proving the joint adventure alleged by them and he, accordingly, decreed plaintiffs to be the owners of an undivided two-thirds interest in the oil, gas and mineral leases and defendant was ordered to convey such interest to plaintiffs. The judge further rendered judgment in favor of plaintiffs and against defendant on their demand for an accounting, decreeing a personal judgment in favor of Little for $1627.75 and in favor of Hayes for $1388.13, with interest from judicial demand and costs.

Defendant appealed to the Court of Appeal, Fourth Circuit, where the judgment of the district court, based on parol evidence, was affirmed. See Little v. Haik, La.App., 154 So.2d 507. In commenting on the order of the district court that defendant convey to each plaintiff an undivided one-third interest in the mineral leases registered in his name when the case was tried, the court said:

'* * * The rendition of such a judgment was correct since the defendant did not object to the introduction of parol testimony to establish plaintiffs' interest in the mineral lease.'

See 154 So.2d 510.

As authority for this conclusion the Court of Appeal cited In Re Industrial Homestead Assn. (La.App.) 198 So. 528 and White v. Lockhart (La.App) 129 So.2d 917 and cases cited therein.

Following the refusal of a rehearing, defendant applied for a writ of review asserting that the ruling of the Court of Appeal is in direct conflict with our recent decision in Hayes v. Muller (on rehearing) 245 La. 356, 158 So.2d 191. The application was granted and the case has been argued and submitted for our decision.

The codal provision which controls this case² is Article 2275. This is the first article of Section 2 of Chapter 6 of Title IV of Book III of our Civil Code, and deals with the testimonial proof of conventional obligations. It declares:

'Every transfer of immovable property must be in writing; but if a verbal sale, or other disposition of such property, be made, it shall be good against the vendor, as well as against the vendee, Who confesses it when interrogated on oath, provided actual delivery has been made of the immovable property thus sold.' (Italics ours).

The Article has been many times construed and applied in cases of verbal transfers and no citation of authority is required to say that it has been rigidly enforced against all persons seeking to establish an interest in immovable property by parol evidence.

Albeit a mineral lease is not either factually or in law a real right (see Reagan v. Murphy, 235 La. 529, 105 So.2d 210), it has nevertheless been 'classified' as such by R.S. 9:1105 and this statute has conferred upon all owners of mineral leases '* * * the benefit of all laws relating to the owners of real rights in immovable property or real estate.' Accordingly, in view of this statute and the proscription of Article 2275 of the Civil Code, parol evidence was inadmissible to refute the denial of defendant that he and plaintiffs entered into a joint adventure for the acquisition of mineral leases and likewise, under our decision on rehearing in Hayes v. Muller, verbal proof of such an agreement could not be received to establish plaintiffs' demand against defendant for an accounting for the profits made by him as the result of the sale of the leases.³

The opinion of the Court of Appeal, as we have observed, is based on the premise that defendant's failure to object at the trial to the introduction of testimonial proof constituted a waiver of his right to require that plaintiffs establish their interest in the leases by written evidence. We think the deduction patently erroneous. The provisions of Article 2275 are unmistakably clear; they ban testimonial proof of all dispositions affecting real property, save in cases where the person holding the title confesses under oath to a verbal agreement to transfer the real estate or to grant an interest therein. And, when a party interrogated as to the existence of such a verbal contract denies that the contract has been made, as in this case, the other party or parties are bound by such denial and cannot contradict it by parol. Fontenot v. Ludeau, 191 La. 540, 186 So. 21; Harvey v. Richard, 200 La. 97, 7 So.2d 674 and Lawrence v. Claiborne, 215 La. 785, 41 So.2d 680. Under such circumstances, there is no warrant in law or in fact for a conclusion that failure to formally object to the offer of parol evidence either changes the nature of such proof or enhances its value so as to equate it to the standards prescribed by the Code. The most that can be said, we believe, is that the failure to object to such evidence enlarges the pleadings. But, then, the pleadings as enlarged would evidence merely a demand to acquire an interest in an immovable under an oral contract, which is not permissible under our law, unless the defendant confesses under oath the making of the contract.

In this Court counsel for plaintiffs persist in the argument that defendant's failure to formally object to the parol evidence at the trial is fatal to his defense despite the fact that he specially assailed plaintiffs' right to prove their case by such evidence. To fortify this position several cases are cited which are said to support it.

We find no merit in the contention. Even though it be conceded that the grounds upon which the exception of no cause of action was founded could not supply the absence of an objection by defendant to parol evidence, it is our view that, by failing to object, defendant did not waive his right to insist that plaintiffs' demands for an interest in the leases and for an accounting be rejected in view of their inability to establish their claims by written evidence. As stated above, this Court, pursuant to Article 2275, has consistently refused to consider parol proof of a claimed title interest by one party when the party against whom the claim is made has purchased the immovable from another party. See Barbin v. Gaspard, 15 La.Ann. 539 (1860);⁴ Kunmengeiser v. Juncker, 28 La.Ann. 678 (1876); Hoffman v. Ackermann (on rehearing) 110 La. 1070, 35 So. 293 (1903); Hanby v. Texas Company, 140 La. 189, 72 So. 933 (1916); Hodge v. Hodge, 151 La. 612, 92 So. 134 (1922); Succession of Prescott, 170 La. 233, 127 So. 611 (1930); Ceromi v....