from the Sixth Judicial District Court for the Parish of
Tensas, Louisiana Trial Court No. 23583 Honorable Michael E.
MICHAEL E. KRAMER Counsel for Appellants
LAW OFFICES Counsel for Appellee By: Richard B. Levin J.
BROWN, GARRETT, and COX, JJ.
defendants, KT Farms Partnership ("KT Farms"), Kyle
Aymond, Thad Herron, KT-One Farms, LLC ("KT-One")
& Thad Kyle Investments, LLC ("TKI"), appeal
from a trial court judgment finding them all liable in solido
to the plaintiff, Monsanto Company ("Monsanto"), in
the amount of $671, 041.60 for seed and products, plus
interest and court costs, as well as attorney fees of $50,
000. For the following reasons, we amend in part, and as
amended, affirm the trial court judgment.
and Herron were farmers in Tensas and Franklin Parishes, and
they, along with KT-One, were partners in KT Farms. Aymond
and Herron formed KT-One and TKI. In February 2011, KT Farms
submitted an interest-free seed financing application to
Monsanto, requesting a credit limit of $245, 000. This
document was signed by Aymond. In addition, he signed an
"Interest Free Seed Financing" agreement with
Monsanto that is the subject of this case. The dealer who was
to supply the Monsanto products under this agreement was
Tensas Farm Service ("Tensas").
2011, TKI executed a guaranty agreement to cover the
obligations of KT Farms to Monsanto. Aymond signed the
guaranty on behalf of TKI. All purchases made by KT Farms
from Monsanto in 2011 were paid for.
2013, Aymond and Herron, on behalf of KT Farms, signed one
page of an incomplete document reflecting that the local
dealer had been changed to Helena Chemical Company
("Helena"). According to Monsanto, in 2013, KT
Farms purchased a total of $671, 041.60 in seed and other
products and did not pay for the goods. Demand for payment
was made by certified letters mailed in February 2014 to
Aymond and Herron as partners of KT Farms. The letters were
unclaimed and were marked "return to sender."
2014, Monsanto filed a petition to collect under the 2011
financing agreement, naming as defendants KT Farms, through
its partners, Aymond, Herron, and KT-One, and TKI as
guarantor of KT Farms. Attached to the petition was a blurred
and partially illegible copy of the financing agreement
signed by Aymond in 2011; a copy of a page from an
unidentified document changing the dealer to Helena, which
was signed in 2013 by Aymond and Herron on behalf of KT Farms
as customer; a copy of the guaranty signed by Aymond on
behalf of TKI in 2011; and copies of the demand letters to KT
Farms through Aymond and Herron. Monsanto alleged that, under
the terms of the agreement, the defendants were liable for
the debt, as well as 18% interest per year on the debt from
December 31, 2013, until paid, plus 25% attorney fees.
defendants filed an answer alleging that the copy of the 2011
agreement attached to the petition was not legible, making it
impossible to determine the terms and conditions of the
alleged agreement. The defendants urged that there was no
information to support the claims of purchase of product, and
that 25% attorney fees were excessive. They also disputed the
balance owed. A pleading in the record indicates that in
October 2015, KT Farms filed for bankruptcy, which was
dismissed in April 2016, and the bankruptcy stay was lifted.
matter was tried on November 30, 2016. Sharon Hernandez, the
collection manager for Monsanto from Missouri, testified that
KT Farms applied to Monsanto for credit through an
interest-free credit financing agreement in February 2011.
The agreement was to cover any purchases made from Monsanto
until cancelled. Aymond, on behalf of TKI, signed a guaranty
agreement to cover the debt of KT Farms to Monsanto. Copies
of the credit application, the 2011 agreement, and the
guaranty agreement were filed into evidence. However, the
copy of the 2011 agreement filed into evidence was not
entirely legible and was introduced over an objection by the
defendants. As explained in one of the briefs on appeal, the
original document was electronically stored. The resulting
copy was only partially legible. Monsanto produced neither
the original agreement signed by Aymond nor a legible copy.
identified a blank agreement submitted by Monsanto that
purported to supply the missing language in the original
agreement. It also provided a copy of a document signed by
Aymond and Herron on behalf of KT Farms in 2013, when the
Monsanto dealer was changed to Helena. Monsanto did not argue
that KT Farms executed a new financing agreement in 2013.
Hernandez stated that the only change to the 2011 agreement
was that Helena became the dealer instead of Tensas. These
documents were admitted into evidence, subject to the
defendants' objection that they were not complete.
memos and delivery tickets were admitted into evidence to
prove that KT Farms made the alleged purchases from Monsanto.
Hernandez testified that these documents corroborated the
Monsanto statement of account, dated February 18, 2014, which
was also admitted into evidence. She stated that Monsanto had
not received payment for any of the charges, even though
formal demand for payment had been made on the defendants.
According to Hernandez, the goods were supplied by Helena,
but the debt was owed to Monsanto.
cross-examination, Hernandez acknowledged that the 2011
agreement had a credit limit of $245, 000; she opined that KT
Farms asked for and received a higher credit limit. She
stated she did not know if any purchases were made in 2012,
or what the credit limit was in 2013.
Willis, a credit manager for Helena from Tennessee,
identified documents connected with the sale of the Monsanto
goods to KT Farms in 2013. He said that, once executed, a
financing agreement remained in effect and the only paperwork
that would have to be resubmitted to Monsanto would be
acknowledgement of a change of dealer. This would allow the
new dealer to receive payments from Monsanto. Willis
identified the invoices and delivery tickets sent from Helena
to Monsanto for payment. When Monsanto paid Helena, Helena
assigned all rights for payment on the invoices to Monsanto.
Willis identified credit memos from Monsanto to Helena for
the invoices submitted for payment.
said that customers often called in orders which Helena
delivered to the farms after purchase. Sometimes they were
signed for and sometimes they were not. He was asked how
Helena verified that the person placing the order was the
person who received the delivery. He stated that their
locations were very familiar with their customers and
recognized their voices on the telephone. They also knew the
locations where the products were to be delivered. He said
sometimes a customer will pick up an order. Willis testified
that he did not know of any complaints that orders placed for
KT Farms were not legitimate or were not
testified that he and Herron handled all orders placed with
Helena. Sometimes they would call the store and sometimes
they went to the store to place orders. Products were then
delivered to them. Aymond examined the delivery tickets and
invoices and observed that some of them were difficult to
read. He claimed the tickets were not signed by people
connected with KT Farms and said he had no way to know if he
received the seed and supplies represented by the tickets.
cross-examination, Aymond acknowledged signing the financing
agreement with Monsanto in 2011, with a $245, 000 credit
limit, but said the signature on the document supplied by
Monsanto did not look like his. He also denied ever signing a
personal guaranty agreement or entering into a financing
agreement with Helena as the supplier in 2013.
was called by Monsanto on cross-examination. He acknowledged
that, in 2011, KT Farms applied to Monsanto for interest-free
financing. He examined the 2011 financing agreement and said
the signature on the document looked like Aymond's.
Herron acknowledged that KT Farms made purchases from Helena
in 2013. He said he was a partner in TKI, but did not
remember the company signing a guaranty agreement with
Monsanto in 2011. Herron first testified that KT Farms did
not file for bankruptcy in 2015. He later said that Aymond
filed the paperwork, but KT Farms did not go through with the
bankruptcy. He did not know if the $671, 041.60 debt at issue
in this case was listed as a debt in the bankruptcy filings
or if he signed the bankruptcy papers.
trial court took the matter under advisement and issued
written reasons and a judgment in favor of Monsanto. In the
reasons for judgment, the trial court found that, in 2011, KT
Farms entered into the "Interest Free Seed Financing
Agreement" with Monsanto. The court found that TKI,
"Kyle Aymond and Thad Herron guaranteed the obligations
of KT Farms." In 2013, the dealer was changed from
Tensas to Helena. The court stated that, from April to June
2013, KT Farms used the credit extended in the financing
agreement to obtain products totaling $671, 041.60. No
payments were made and no response was made to Monsanto's
demand for payment. The court noted that, at trial, Aymond
and Herron claimed that the goods were not delivered to KT
court found that Monsanto carried its burden of proof on the
amount owed and noted that the agreement called for 18%
interest per year, from December 31, 2013, until paid, along
with reasonable attorney fees. According to the court,
Monsanto sought 26% attorney fees, which would amount to
$175, 000, but the trial court found this was unconscionably
excessive. The trial court considered the hours
worked, the expertise of the attorney, and the fact that the
attorney took the case on a 15% contingency fee agreement.
The court noted that the matter required more skill than a
regular open account case. The trial court awarded attorney
fees in the amount of $50, 000. The trial court signed a
judgment in favor of Monsanto and against KT Farms, Aymond,
Herron, KT-One, and TKI, in solido, for $671, 041.60, plus
18% interest per year on the unpaid balance from December 31,
2013, until paid, together with court costs and $50, 000 in
attorney fees. The defendants appealed.
TO RECOVER ON DEBT, INTEREST, AND ATTORNEY FEES
defendants argue that the trial court erred in granting
judgment in favor of Monsanto based upon the provisions of
the 2011 and 2013 "Interest Free Seed Financing"
agreements. They maintain that the 2011 agreement filed into
evidence was illegible, making it impossible to determine its
terms and provisions. They assert that the first three pages
of the 2013 agreement were blank. Therefore, according to the
defendants, there are no applicable provisions in either
agreement which would render them liable to Monsanto.
defendants also argue that the trial court erred in awarding
Monsanto $50, 000 in attorney fees. They contend that the
2011 and 2013 agreements did not provide for the award of
attorney fees. In the alternative, the defendants argue that,
if attorney fees are due, Monsanto is limited to an award of
reasonable attorney fees. Based upon the affidavit of
Monsanto's attorney regarding the amount of work done in
this matter, Monsanto should only recover $15, 000, not $50,
000 as awarded by the trial court.
be discussed below, we find that the trial court properly
awarded Monsanto the money due for items purchased by KT
Farms, but erred in basing that decision entirely on the 2011
agreement. Also, the trial court erred in awarding interest
and attorney fees based solely upon the 2011 contract and
erred in the amounts awarded. The trial court further erred
in finding that Aymond and Herron personally guaranteed the
debts of KT Farms, in addition to the guaranty executed by
TKI, and erred in finding all the defendants liable to
Monsanto in solido.
the trial court properly awarded Monsanto $671, 041.60 for
charges made by KT Farms, it erred in basing that decision
solely upon the terms of the 2011 financing agreement. The
copy of the 2011 contract filed into evidence does not
contain any legible provisions setting an 18% per year
interest rate or entitling Monsanto to recover attorney fees.
The legible portion of the 2011 agreement provided:
Interest Free Financing Agreement
[Illegible] below ("Customer") agrees to pay
Monsanto Company ("Monsanto") for the purchase of
Monsanto seed products that Customer has [Illegible] Dealer
listed below and that the Dealer has assigned to Monsanto
pursuant to the terms of Monsanto's current FarmFlex
Financing [Illegible] of Customer's purchases that the
Dealer may assign to Monsanto is limited to the
Customer's credit limit approved in relation to this
[Illegible] may change or withdraw that credit limit at
anytime [sic], except to the extent seed that has already
been delivered to ...