Franklinton Canning Co. v. Blaize & Johnson , 191 So. 318 ( 1939 )

I am forced to disagree with the majority opinion on its reversal of the finding of facts by the trial court, as well as what appears to me to be an incorrect application of certain legal principles involved in the case.

The majority opinion concedes the existence of a valid and binding contract of lease of the canning plant for the 1938 season between the receiver and Blaize and Johnson by which contract the said Blaize and Johnson unconditionally bound themselves to pay the plaintiff the sum of $300 plus 5 cents per case on all beans packed as rental for the plant. In order for Blaize and Johnson to be relieved of any of their obligations, and in order for the property of these lessees or the property of any third person in the leased premises to be released from the rental obligation assumed in that lease, the burden rests on Blaize and Johnson, or any third person seeking to have his property released from the lessor's privilege, to show that the lease was so modified or changed as to eliminate part of the rental charge. This principle of law is too well established to require the citation of authority, yet, as I read the majority opinion, it appears to me that this rule has been reversed, and a conclusion has been reached which, in effect, holds that the plaintiff has failed to prove that the original lease was not modified and the 5 cent per case part of the rent was not eliminated, instead of placing the burden of showing this modification on the defendants. The effect of releasing Skrmetta from personal liability also has the effect of releasing the property and effects which he placed in the premises from the lessor's privilege which plaintiff otherwise would have had on this property to secure the payment of that part of the rent based on 5 cents per crate.

The majority opinion further concedes that the evidence shows that Johnson and Blaize, the ones who were bound for the rent, brought Skrmetta into the picture for the purpose of letting Blaize out. It was not the plaintiff that initiated the move to change the terms of the lease. Johnson brought Skrmetta to the receiver to discuss a plan whereby Blaize who had paid one hundred dollars on the rent might get his money back and retire from the contract. It is stated in the majority opinion that the receiver testified that Johnson brought Skrmetta to his office and that both Johnson and Skrmetta stated to the receiver that if Blaize could be gotten out, Skrmetta would take his place on refunding to Blaize the amount the latter had paid on the rent. It was on this testimony of Greenlaw, the receiver, that the trial judge based his finding of fact wherein he held that the amount of rent to be paid had not been changed by any agreement on the part of the receiver. If the testimony of Greenlaw on this point is accepted there is nothing to show that he at any time agreed to eliminate the 5 cents per case as part of the rent, and the result of the decree entered on the appeal is to hold that the receiver did either expressly or impliedly agree to eliminate this part of the agreement.

I am unwilling to subscribe to an opinion which holds that the trial judge was in error in believing the testimony of Greenlaw instead of that of Skrmetta and his witnesses, one of whom was Johnson. The reasons given in the majority opinion for holding that the trial judge was in error in believing the testimony of Greenlaw in preference to that of Skrmetta and his witnesses are the following:

(1) Because Greenlaw did not tell Skrmetta all the terms of the lease with Blaize and Johnson and particularly the 5 cents per case as part of the rent. It is conceded that Greenlaw did not purposely withhold any information from Skrmetta. Then why was Greenlaw obliged to give Skrmetta all the details of the lease? It was Johnson and Skrmetta who came to Greenlaw to discuss and secure changes in the lease, not the making of a new lease. It was certainly as much the duty of Skrmetta to ask for and obtain all the terms of a lease under which he was to assume certain obligations as it was the duty of Greenlaw to give him the details of the lease. As Johnson brought Skrmetta to Greenlaw to substitute Skrmetta for Blaize, Greenlaw certainly had a right to assume that Skrmetta knew the terms of the lease with Blaize and Johnson. It is indicated in the majority opinion that it was the duty of Greenlaw not only to show the written contract to Skrmetta but to have secured his assent in writing to the terms of the lease. I am unable to see why such a great obligation was placed on Greenlaw and practically none at all on Skrmetta. Greenlaw was not seeking a new lessee; he already had lessees who were bound under terms which they themselves proposed and which the court approved.

(2) It is stated that Greenlaw is a much more experienced business man with greater business acumen than Skrmetta and for that reason he was under a greater duty to inform the latter of the terms of the Blaize and Johnson lease. But the trial judge who had a peculiar opportunity to ascertain the ability and business acumen of Skrmetta did not think he was in need of special protection on account of ignorance and inexperience, but, on the contrary, thought that Skrmetta was well able to take care of himself. My reading of the testimony does not lead me to believe that the trial judge was in error in his evaluation of Skrmetta's ability and business acumen.

(3) As a circumstance strengthening the contention of Skrmetta that the 5 cents per case was eliminated in the agreement had by him with the receiver, it is said that the receiver made no demand on Skrmetta for this 5 cents per case until the close of the season. This is true, but it is also true that the receiver made no demand on Skrmetta for the balance of $200 which, under the original lease, was to be paid before the end of the packing season.

In an effort to support the contention of Skrmetta that he was not to pay 5 cents per case as part of the rent, Johnson testified that any person who would agree to pay $300 and 5 cents per case for the rent of this plant would be out of his mind, yet, Johnson stultified himself in so testifying as he is the very person whose name is signed to the letter of Blaize and Johnson to the receiver proposing to pay these identical amounts for the rent of this plant.

Mr. Greenlaw, the Receiver, testified that after the contract of lease was entered into with Blaize Johnson and after they had paid the $100 provided for in the lease, Johnson brought Skrmetta to his office and these two stated to him that if they could get Blaize out Skrmetta would come in and take his place; that Skrmetta did not inquire as to the terms of the contract with Blaize Johnson, and that he (Greenlaw) did not tell him the terms nor say anything about the 5 cents per crate as part of the rent; that he (Greenlaw) did not know that Skrmetta was not familiar with this part of the contract until just before the end of the packing season; that he (Greenlaw) thought that Skrmetta was familiar with the contract of lease as he was trying to get Blaize out of it; that nothing was said at the time about Skrmetta paying Blaize back the one hundred dollars that he paid. Greenlaw testified positively that he had no agreement with Skrmetta that the latter was to pay Blaize $100 to refund the amount paid by him and that Skrmetta was to pay the other $200 and take over the plant. The receiver further stated positively that he entered into but one contract for the lease of the plant, and that was with Blaize Johnson under the order of court.

In my opinion, the testimony of Greenlaw is corroborated by the following facts and circumstances:

(1) Blaize and Johnson sought out Skrmetta and brought him to Greenlaw with the apparent purpose of making it possible for Blaize to get out and get his money back. If Blaize and Johnson did not inform Skrmetta of all the terms of the lease, that was no fault of Greenlaw's as the latter understood that Skrmetta was taking the place of Blaize.

(2) Skrmetta actually paid Blaize $100 to re-imburse him, and thereafter Blaize retired from the business and it was carried on by Johnson and Skrmetta.

(3) Before Skrmetta came into the picture the receiver and Blaize Johnson had a verbal understanding that a man named James was to keep an account of the number of crates packed by the plant so that the rent could be determined, and this agreement was carried out after Blaize got out and Skrmetta came in. If this part of the lease had been abrogated in the new agreement as claimed by Skrmetta, there would have been no occasion whatever for a man to keep account of the crates for the receiver.

(4) At no time did the receiver get an order of court to make a different lease with another person and on entirely different terms.

Under the finding of fact made by the trial judge, I think the acts of Skrmetta in paying off Blaize and continuing the business with Johnson under the terms of the lease, particularly with reference to keeping an account of the crates packed, are sufficient to bind Skrmetta under an implied agreement on his part to assume the obligations of the lease. C. C. arts. 1816 and 1817; Meriwether v. Dorrity et al., 158 La. 405, 104 So. 187. The assumption by Skrmetta of the obligation of the lease does not arise from an agreement on his part to pay the debt of a third person, but his obligation was a primary one arising from his undertaking to carry out a lease made for the mutual benefit of the lessor and the lessees and in which Skrmetta, for his own pecuniary benefit, took over the rights, as well as assuming the obligations of the lease. Wallenburg v. Kerry, 16 La.App. 221,133 So. 823.

If Skrmetta was substituted as the sole lessee of the plant for a rental of $300 only as claimed by him, it is obvious that the original lease with Blaize and Johnson was abrogated and there is no liability on the part of Blaize and Johnson whatever, yet by reason of the failure of the latter to appeal from the judgment against them, we have the anomalous and inconsistent situation wherein plaintiff has a judgment against its original lessees under a contract that was not merely changed as to the amount of the rent, but which was entirely abrogated and another one substituted in its place.

I respectfully dissent.