Chestnut v. Hammatt
157 So. 2d 915, 1963 La. App. LEXIS 2043 (1963)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
An object placed on land by its owner for the land's service and improvement becomes an immovable by destination and passes with the sale of the land. A prior, separate sale of that object is ineffective against the land's purchaser if the object's new owner, acting as the land seller's agent, failed to disclose his ownership during the land sale negotiations.
Facts:
- Mrs. Louella Fugler Hammatt owned a 200-acre dairy farm equipped with a Van Vetter Bulk Milk Tank and vacuum pump, which were essential for the dairy's operation.
- On December 24, 1960, Mrs. Hammatt entered into a written agreement to sell the 200 acres to Nathaniel P. Chestnut, which was witnessed by her agent, R. L. Fugler, Jr.
- On January 5, 1961, Mrs. Hammatt executed an act of sale for the milk tank and pump as movables to R. L. Fugler, Jr.
- R. L. Fugler, Jr. acted as Mrs. Hammatt's agent during the final negotiations for the sale of the land to Chestnut and his partner, Melba L. Harvey.
- On January 12, 1961, Mrs. Hammatt sold the 200-acre property and its improvements to Chestnut and Harvey, who then leased the dairy back to Mrs. Hammatt for 90 days.
- During the lease period, R. L. Fugler, Jr. operated the dairy.
- On April 5, 1961, R. L. Fugler, Jr. and several others removed the bulk milk tank and pump from the property during the early morning hours.
Procedural Posture:
- Nathaniel P. Chestnut and Melba L. Harvey sued Mrs. Louella Fugler Hammatt, R. L. Fugler, Jr., and Fred Fugler in a Louisiana trial court for compensation for the tank and pump.
- The plaintiffs alleged unlawful conversion against all defendants and, alternatively, breach of warranty of title against Mrs. Hammatt.
- The trial court found that the pump was a movable but the bulk milk tank was an immovable.
- The trial court entered judgment in favor of the plaintiffs and against the defendants in solido for $2,336.42, representing the value of the tank.
- The defendants (appellants) appealed the trial court's judgment to the Court of Appeal of Louisiana, First Circuit. The plaintiffs (appellees) did not appeal the ruling regarding the pump.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does an essential piece of equipment, classified as an immovable by destination, pass with the sale of real estate to a bona fide purchaser, despite the owner's prior, undisclosed sale of the equipment as a movable to the owner's agent who negotiated the real estate transaction?
Opinions:
Majority - Ellis, Judge.
Yes, the equipment passes with the sale of the real estate. Under Louisiana Civil Code Article 468, the bulk milk tank was an 'immovable by destination' because the owner placed it on the land for its service and improvement, as milk produced without it would be unsalable. Although an owner can treat an immovable by destination as a movable, this is not determinative here. R. L. Fugler, Jr., as the vendor's agent and the alleged purchaser of the tank, was bound to disclose his ownership to the plaintiffs during the sale negotiations. By remaining silent about his ownership of what appeared to be part of the real estate, he is estopped from asserting his claim against the bona fide purchasers. Furthermore, Mrs. Hammatt had already entered into a written agreement to sell the land and its improvements on December 24, 1960, divesting her of the right to subsequently sell the immovables by destination separately without the purchasers' consent.
Analysis:
This decision reinforces the doctrine of immovables by destination and establishes an important estoppel principle in Louisiana property law. It clarifies that an agent's duty of disclosure in a real estate transaction can override a prior, separate conveyance of a fixture. The ruling protects bona fide purchasers from secret side-deals that would devalue their property, emphasizing that what appears to be part of the realty is presumed to be included in the sale unless explicitly excluded. The case also affirms that a binding purchase agreement for real estate limits the seller's ability to subsequently sever and sell fixtures to third parties.
Unlock the full brief for Chestnut v. Hammatt