Terry v. Butler , 240 La. 398 ( 1960 )

HAMITER, Justice.

Plaintiffs, Mrs. Hattie Terry Lanier, Mrs. Hazel Terry McMillin, Mrs. Mary Terry Alpin, Mrs. Hannah Terry Cantwell and Albert Terry, instituted this suit to recover damages of $23,186 for the alleged unlawful cutting and removal of undersized timber from their 220 acre tract of land situated in Catahoula Parish. Made defendants were T. S. Butler and T. A. Mc-Dougal.

After trial judgment was rendered in favor of the plaintiffs and against the defendants, in solido, in the amount of $1,-250, together with legal interest from judicial demand and all costs. And from it all parties appealed, the appeal of the plaintiffs of course being limited to the question of quantum.

The record discloses that prior to August 11, 1950. one Newburg Sandifer approached Albert Terry (a plaintiff) to determine whether he and his co-owners would be interested in selling to a then undisclosed principal timber from their land. After conducting negotiations, in some of which the defendant McDougal took part, an agreement was reached; and at that time Terry (who was acting as the agent for his co-owners) was told that T. S. Butler would be the purchaser of the timber and that McDougal would perform the cutting operations.

Later, on August 11, 1950 and in conformity with the agreement, a deed was executed wherein the plaintiffs sold and conveyed to the defendant Butler all of the merchantable timber on the above mentioned 220 acre tract. The deed particularly provided: “It is contracted and agreed that the purchaser shall not cut or cause to be cut any pine smaller than 10" in diameter, 12" from the ground; or any hardwood timber less than 12" in diameter, 12" from the ground.” But in violation of such provision McDougal, in undertaking the cutting operations through an agent, removed a number of undersized trees and converted them into pulp wood which he sold to the International Paper Company and delivered to the latter’s mill in Spring-hill, Louisiana, where it was used in making lap pulp and other more refined wood-paper products.

Following completion of the cutting operations plaintiffs commenced this litigation. In their original and supplemental petitions they alleged that 719 trees of less than 10" in diameter, 12" from the ground, had been removed by Butler and McDougal. Plaintiffs further alleged that such defendants were in moral bad faith in taking the undersized trees and that, therefore, they were entitled to recover the manufactured value of the timber without any deduction for the manufacturing cost.

As shown by his written reasons for the judgment rendered the district judge found that both of the defendants were in moral, as well as legal, bad faith. He further determined that some 700 undersized trees had been cut and thereafter converted into 100 cords of pulp wood which had a value of $12.50 per cord delivered to the International Paper Company in Springhill. And he fixed the damages to which plaintiffs were entitled as the value of the delivered pulp wood without any deductions for the expenses incurred by the defendants in converting the standing timber into pulp wood and in transporting it to the mill.

The defendant Butler complains here that the district court erred in holding him liable in any amount, his position on this point being that he was not the actual purchaser of the timber from plaintiffs. Alternatively, he contends that if there is liability on his part the damages awarded should be only for the stumpage value of the timber in question inasmuch as he was in neither legal nor moral bad faith. Mc-Dougal, while conceding his legal bad faith, maintains that the trial judge erred in finding him in moral bad faith. And both defendants urge that, in any event, the damages awarded were excessive because only 485 undersized trees were cut and removed.

We agree with the district judge’s conclusion that there is liability on the part of Butler. It is true that he testified (over the repeated objections of plaintiffs’ counsel) that McDougal was the actual and sole purchaser of the timber; that the latter borrowed money from him to make the purchase ; and that, through an oral agreement with McDougal, he had the title placed in his name merely to secure the payment of such loan, as well as the payment of another indebtedness of McDougal with the LaSalle State Bank of which he was the president. But clearly that testimony was inadmissible, and it cannot be considered, for the purpose of varying the written contract executed by Butler with plaintiffs, particularly since it is not shown that the

latter had any knowledge of the mentioned oral agreement. Insofar as these plaintiffs are concerned Butler was the principal, with McDougal acting as his agent, in the purchasing and cutting of the timber.

With reference to the question of the moral bad faith of both defendants the district judge observed: “ * * * defendants had been requested to desist but they continued with their illegal cutting until some one hundred cords of pulpwood from some seven hundred small trees had been illegally taken from this land of the plaintiffs.

“From the evidence adduced upon the trial of this suit, it is certainly apparent that the defendants were acting in moral as well as in legal bad faith in the cutting of this undersized timber from plaintiffs’ lands.” The record amply sustains this observation. The evidence preponderately shows that on at least two occasions, when not more than three or four acres of the 220 acres had been cut, both McDougal and Butler were notified that undersized timber was being removed. Nevertheless, neither took any steps to insure the cessation of such activity.

As to their contention that the district court was in error in concluding that some 700 undersized trees were cut, defendants point out that their witnesses testified that only 485 trees were removed. On the other hand, however, the witnesses for plaintiffs stated that they had gone over the entire property, measured the stumps, and found 719 undersized trees cut. In this connection they said that, while making their inspection, they marked each undersized stump so that it would not be counted twice. Thus, there was an obvious conflict in the evidence respecting the number of undersized trees removed. And in resolving it the judge accepted the testimony of plaintiffs’ witnesses. We cannot say that, in so doing, he manifestly erred, especially since it appears that the inspection by such witnesses was carefully and accurately made.

Having concluded that the defendants were in moral bad faith we must determine the amount of damages to which the plaintiffs are entitled, they having appealed from the district court’s award that was predicated on the value of the pulp wood as converted by defendants and delivered to the International Paper Company Mill.

Complaining that the award was improperly based they, to quote from the brief of their counsel, say: “The manufactured product of small trees which are not converted to lumber, would be the product to which they are converted. The undersize trees from the Terry property were taken to International Paper Company’s Spring-hill Mill, at Springhill, Louisiana, and there manufactured into unbleached and bleached paper board. * * * ” And they take the position that they are entitled to the value of the products into which the timber was ultimately manufactured (lap pulp and paper board) through the efforts and expenditures of the innocent purchaser International "Paper Company, this without any deduction for costs incurred by the latter or by the defendants.

The numerous decisions cited by plaintiffs, all of which we have carefully considered, do not support their position. •Rather, they sustain the basis for determining value that was used by the trial judge.

Thus, in Kennedy v. Perry Timber Company, 219 La. 264, 52 So.2d 847, 851 (primarily relied on by plaintiffs), this court said: “The measure of damages allowable for the unlawful cutting of timber is well settled in this State. If the trespass has been reckless and willful, the trespasser is said to be guilty of moral bad faith and is liable for the converted value of the timber without allowance or deduction for costs and expenses. In cases where the trespasser believes himself to be owner but should have known otherwise, either from information available to him or other ascertainable facts which would have placed a reasonably prudent man on notice, he is held to be in legal bad faith and the actual expenses incurred by him in converting the timber are to be deducted in assessing the damages. * * * ” While in the Kennedy case we did not spell out what was meant by the term “converted value” used in referring to the trespasser in moral bad faith, the remainder of the quoted language clearly shows that the court intended that the owner would be entitled to the value of the product as converted by the trespasser. Moreover, the result reached in the case indicates such an intention. Therein, we specifically pointed out that “Simmons (one of the defendants) wantonly and recklessly cut and removed 1810 trees from plaintiff’s land, converted them into poles and pilings, which he sold to Perry Timber Company (another defendant) for $3416.35and we affirmed a damage award against those defendants for the named amount. (Italics ours.)

Again, in State v. F. B. Williams Cypress Company, Limited, 131 La. 62, 58 So. 1033, 1036 (cited in the Kennedy decision and relied on herein by plaintiffs), we observed: “* * * In the instant case, as in the case of Eastman v. Harris, supra, the ends of justice are subserved by holding that the owner is entitled to the profit resulting from the change made in the form or condition of the property by the possessor in legal bad faith, and that the latter cannot reasonably expect anything more than the reimbursement of the expense incurred in making the change. * * * ” There, the wrongdoer was in legal, but not in moral, bad faith; consequently, he was condemned for the value of the timber in the state into which he converted it, less his converting expenses. (Italics ours.)

The same principle, stated in a different way, was expressed thusly in State v. Jefferson Island Salt Mining Company, Inc., 183 La. 304, 163 So. 145, 167 (cited in the Kennedy case and by plaintiffs herein), the court having found that the trespasser there was in moral bad faith: “ ‘The measure of damages for the reckless, willful, or intentional taking of ore or timber from the land of another without right is the enhanced value of the ore or timber when it is finally converted to the use of the trespasser, without allowance to him for the labor bestowed or expense incurred in removing and preparing it for market.’ * * ” (Italics ours.)

We recognize, of course, that in some decisions cited by plaintiffs the court has used the term “manufactured value” in assessing damages for timber wrongfully taken. But obviously it was so employed for the reason that the timber had been changed through the efforts and expense of the trespasser into products more refined than mere logs, poles or pulp wood.

For example, in Coignet v. Louisiana Cypress Lumber Company, Limited, 177 La. 1023, 150 So. 6, 9, the court said: “As we appreciate the law of this state, the measure of damages due by a trespasser must be determined by the value of the timber and its manufactured product at the time the timber is cut and the lumber is sold by the trespasser. Allen v. Frank Janes Co., 142 La. 1056, 78 So. 115; * * (Italics ours.)

Incidentally, the following observation is found in the mentioned Allen case: “In measuring the damages due by a trespasser for -cutting and removing, timber, this cpurt has made a distinction between legal and moral bad faith. In both cases the value of the timber is fixed at the amount at which . it was sold by the trespasser; but in the one case the expenses incurred by the trespasser are allowed to be deducted, whereas in the other, they are not. * * * ” [142 La. 1056, 78 So. 116.] (Italics ours.)

In sum, we have found no decision in the jurisprudence of this state wherein- damages were awarded in excess of the value of the timber as converted and sold by the wrongdoer.

In the instant cause the judge awarded damages for only 700 undersized trees removed, whereas the evidence preponderate- ■ ly shows that those taken numbered 719 which produced a total of 102.7 cords of pulp wood. To the extent of this difference the award will have to be increased.

For the reasons assigned the judgment of the district court is amended by increasing the award in favor of plaintiffs from $1,250 to $1,283.75; and, as thus amended, it is affirmed. The costs of this court shall be paid in the proportion of one-half by plaintiffs and one-half by the defendants.