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Citrus Realty, LLC v. Parker

Court of Appeals of Louisiana, Fourth Circuit

January 30, 2019

CITRUS REALTY, LLC
v.
CONSTANCE CARRERE PARKER AND CAROL CARRERE THOMPSON

          APPEAL FROM 25TH JDC, PARISH OF PLAQUEMINES NO. 60-249, DIVISION "A" Honorable Kevin D. Conner, Judge

          Seth E. Bagwell Matthew J. Fantaci CARVER, DARDEN, KORETZKY, TESSIER, FINN, BLOSSMAN & AREAUX, LLC COUNSEL FOR PLAINTIFF/APPELLANT

          Bruce Victor Schewe Dan Zimmerman PHELPS DUNBAR LLP, George Pivach II Timothy Thriffiley PIVACH, PIVACH, HUFFT, THRIFFILEY & DUNBAR, L.L.C. COUNSEL FOR DEFENDANT/APPELLEE

          Patrick S. Ottinger Ottinger Hebert, L.L.C. ATTORNEYS FOR LOUISIANA LANDOWNERS ASSOCIATION, INC./ AMICUS CURIAE

          Court composed of Judge Rosemary Ledet, Judge Sandra Cabrina Jenkins, Judge Regina Bartholomew-Woods

          REGINA BARTHOLOMEW-WOODS JUDGE

         Appellants, Constance Carrere Parker ("Parker") and Carol Carrere Thompson ("Thompson") (collectively, "Appellants"), appeal the February 20, 2018 judgment of the district court granting summary judgment in favor of Appellees, Citrus Realty, LLC ("Citrus") and White Oak Realty, LLC ("White Oak") (collectively, "Appellees"). For the reasons that follow, we reverse the judgment of the district court and remand for further proceedings.

         PROCEDURAL AND FACTUAL BACKGROUND

         Appellants are the former owners of a ten percent (10%) interest in three (3) noncontiguous tracts of land-Idlewild, Narin, and Braithwaite-located in Plaquemines Parish, Louisiana ("the Property"). In 1999, Appellants agreed to sell their share in the Property to Citrus, subject to a mineral servitude. Citrus agreed to the servitude, but insisted on a surface use restriction. Citrus acquired Appellants' ten percent (10%) interest in the Property pursuant to a cash sale, which provided in part:

Seller hereby reserves all forms of minerals, including oil and gas, in, on or as a part of the soil or geological formations on or underlying the Property, however without the right to utilize the surface to explore for minerals but with the right to explore for minerals by off-site directional drilling or other means not involving the surface of the Property. This reservation specifically reserves to Seller all executive rights and/or other rights to grant mineral leases or conveyances encumbering and/or affecting the Property. The parties hereto further agree, as provided in La. R.S. 31:75, that an Interruption [sic] of prescription for the nonuse of the above described mineral servitude resulting from unit operations, whether conventional or compulsory, shall extend to the entirety of the hereinabove described tract of land burdened by this mineral servitude regardless of the location of the well or of whether all or only part of the hereinabove described tract of land is included in the unit.

         White Oak acquired the remaining ninety percent (90%) interest in the Property subsequent to Appellants' sale to Citrus.

         In 2013, Appellees began to mine a portion of the Property subject to the mineral reservation for clay. Appellants asserted their ten percent (10%) interest in the clay pursuant to the mineral servitude. In response, Citrus sought a declaratory judgment that Appellants' mineral servitude did not extend to the clay. White Oak was added as a party plaintiff by an amended petition filed on April 3, 2013. Appellants filed affirmative defenses, an answer, and a reconventional demand seeking a declaratory judgment that their servitude covered all forms of minerals.

         The matter came before the district court on summary judgment in June 2013. Plaintiffs-Appellees claimed that because clay cannot be excavated without going onto the Property or by offsite drilling, the act of sale did not reserve for Defendants-Appellants a mineral servitude in the clay. In opposition, Defendants-Appellants argued the plain language of the act of sale provides that the mineral servitude covers "all forms of minerals, including oil and gas, in, on or as a part of the soil or geological formations on or underlying the Property" and that the surface use restriction only limits their right to use the surface of the Property for exploration and does not restrict their right to share in the production. Defendants-Appellants alternatively argued that, to the extent the reservation is ambiguous, extrinsic evidence shows that the parties intended solid minerals to be covered by the servitude. On November 27, 2013, the district court denied the motion, setting the matter for further discovery and indicating it would consider the issue on subsequent motion.[1] Appellees sought supervisory review, which this Court denied. Citrus Realty, LLC, et al. v. Parker, et al., 2013-1691 (La.App. 4 Cir. 2/11/14)(unpub.).

         After this Court's denial of the writ application, the parties engaged in additional discovery. Appellants filed a motion for partial summary judgment as to whether the mineral servitude covered clay and whether the servitude had prescribed for non-use. The district court took the matter under advisement and ultimately entered a denial and reasons therefor on January 16, 2018. Appellees subsequently moved for summary judgment for purposes of obtaining a final, appealable judgment. On February 20, 2018, the district ...


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