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Fruge Aquafarms, Inc. v. Hicks

Court of Appeals of Louisiana, Third Circuit

May 3, 2017

FRUGE AQUAFARMS, INC.
v.
ROBERT R. HICKS, JR.

         APPEAL FROM THE FIFTEENTH JUDICIAL DISTRICT COURT PARISH OF ACADIA, NO. 2014-11142 HONORABLE THOMAS R. DUPLANTIER, DISTRICT JUDGE

          Michael H. Landry Landry, Landry & Landry COUNSEL FOR PLAINTIFF/APPELLANT: Fruge Aquafarms, Inc.

          Stephen A. Stefanski Edwards, Stefanski & Zaunbrecher, L.L.P. COUNSEL FOR DEFENDANT/APPELLEE: Robert R. Hicks, Jr.

          Court composed of D. Kent Savoie, Van H. Kyzar, and David E. Chatelain, Judges

          VAN H. KYZAR JUDGE

         Fruge Aquafarms, Inc. appeals from a judgment of the Fifteenth Judicial District Court for Acadia Parish denying its request for specific performance of an agricultural lease contract and for damages, including damages for unjust enrichment, following the termination of the lease. For the reasons assigned, we reverse the judgment of the trial court and remand for proceedings consistent herewith.

         FACTS AND PROCEDURAL HISTORY

         This dispute arises from an agricultural lease between the lessee, Fruge Aquafarms, Inc. (hereinafter Fruge), and the landowner, Robert Hicks, Jr. (hereinafter Hicks), executed in writing in June of 2010. The lease was referenced in Fruge's original petition and attached thereto. The lease involved six separately described tracts of land and was for the specific purpose of permitting Fruge to "use and occupy said premises for agricultural and aquacultural purposes only." The lease further provided Fruge the "authority to plant said premises in rice, soybeans, and wheat, and to farm crawfish, only during the term of this lease in keeping with the farming practices for the cultivation of crops in the locality of said property." The term of the lease as specifically stated therein "is five (5) years, commencing on January 1, 2010, and ending at midnight on January 1, 2015." As to rent, the lease provided that Fruge would pay "Twenty-Five (25%) Percent of the gross revenue derived from the production of rice; and Fifteen (15%) Percent of the gross revenue derived from the production of soybeans" and further provided that Fruge would pay "FORTY AND NO/100 ($40.00) DOLLARS per acre per year for each acre on which crawfish operations are conducted." Further, Fruge agreed to "[r]emove any of its crops from the leased premises prior to the expiration of this lease, it being agreed between the parties that upon Lessee's failure to do so, title thereto shall thereupon vest in Lessor and Lessee shall forfeit any rights therein." Finally, and of particular importance to this litigation, Section 10 of the contract entitled "CONDITION OF SURRENDER" provided as follows:

Lessee agrees that it will peaceably surrender the leased premises at the end of the term hereby granted in the same good order and condition as the premises are at the commencement thereof.
Lessor agrees that if the Lessor terminates the lease for any reason, that the Lessee shall have until the following July of the successive year to complete the harvest of all crawfish.

         As alleged in Fruge's petition, prior to the termination of the lease by its express terms, Hicks provided written notice to Fruge by letter dated October 15, 2014, that he did not intend to renew the lease upon the expiration date. Thereafter, Fruge filed a "Petition for Specific Performance" with the trial court on December 23, 2014. In the petition, Fruge asserted that he:

[D]esires to demand specific performance of the defendant's promise and contractual obligation to allow plaintiff to remain on the defendant's land on which a crawfish crop has been prepared and to remain undisturbed in the use of equipment necessary to complete that harvest by July, 2015, all as specifically set forth in the agricultural lease made the subject of this litigation.

         Further, Fruge pled:

[A]lternative[ly] and only in the event that this Honorable Court finds that the aforementioned agricultural lease does not allow the plaintiff to remain on the tracts of land on which a crawfish crop has already been prepared, plaintiff alleges that it is entitled to an award of damages concerning its preparation of a crawfish crop, all such damages to be proven at the time of trial.

         The matter first came before the trial court for a hearing on January 5, 2015. On that date, according to the minutes of court, the matter was heard on a "Petition for Injunction." According to the minutes, following the arguments of counsel for both parties, the trial court denied the injunction. A judgment was signed by the court on February 9, 2015. The judgment states as follows:

After reviewing the memoranda of the parties and hearing the argument of counsel, the Court denied plaintiffs Petition for Injunction, dismissing plaintiffs claims for injunctive relief against the defendant.
IT IS ORDERED, ADJUDGED AND DECREED that the Petition for Injunction is DENIED, dismissing plaintiffs claim for injunctive relief against the defendant.

         Notice of judgment was mailed on March 3, 2015. Prior thereto, an answer and reconventional demand had been filed by counsel for Hicks, denying the original claims for specific performance under the contract. Fruge then amended and supplemented its petition with leave of court, seeking damages against Hicks for the value of its efforts in preparing the crawfish crop that allegedly went unharvested prior to July 1, 2015, as it claimed was its right pursuant to the lease, and for unjust enrichment. Hicks answered and reconvened seeking damages for unpaid rent pursuant to the lease.

         At the trial date on June 27, 2016, substituted counsel appeared for Fruge, while Hicks was represented by his original attorneys. No evidence was presented by either side. After discussion in open court and arguments of counsel, the trial court ruled as follows:

THE COURT: - I'm not. I mean, I've - Mr. Landry, I've heard this argument. And it's not unjust enrichment. It's not unjust enrichment when somebody, who's involved in a lease, knows the term that the lease ends. Whether he believed it not to end or not, is not a legal binding belief. I mean, his belief doesn't sway the Court that it's a legal belief, and the fact that he put money into it in 2014 to continue, not to mention my guess is Mr. Fruge made quite a ...

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