McCormick v. Harrison

Louisiana Court of Appeal
926 So. 2d 798 (2006)

ELI5:

Rule of Law:

A personal servitude of right of use that requires a monthly payment for its exercise does not automatically terminate upon the holder's failure to pay. Where the agreement is silent on the timing of payment and the landowner interferes with the use, the failure to pay does not extinguish the servitude.

Facts:

In 1993, Gilbert and Nancy Ciavaglia sold property to Danny and Susan Payne, granting them a servitude to use a nearby horse racetrack for a $100 monthly fee for any month of use.
In 1995, the Paynes sold their property to Donald Harrison, which included the transfer of all rights to use the horse track.
From 1995 until 1999, Harrison used the track and paid the Ciavaglias, the track's owners, the monthly fee.
In 1999, the Ciavaglias sold the property containing the racetrack to Lifeline Nursing Company, which objected to Harrison's use, causing him to cease using it.
In September 2004, Dr. George M. McCormick, II purchased the racetrack property from Lifeline.
In October 2004, Harrison's employee used the track once, but on two subsequent attempts that same month, McCormick's representative ordered the employee to leave, preventing further use.
Harrison did not tender the $100 payment to McCormick for the month of October 2004.

Procedural Posture:

Dr. George M. McCormick, II filed a petition in the district court for a declaratory judgment to declare the servitude extinguished.
Donald Harrison answered and filed a reconventional demand (counterclaim) seeking damages for McCormick's refusal to allow use of the track.
The trial court found that the personal servitude was still in existence and declared Harrison was entitled to use the track upon advance payment of the monthly fee.
The trial court also denied Harrison's demand for damages.
McCormick, as appellant, brought a suspensive appeal to the Court of Appeal of Louisiana, Second Circuit, challenging the trial court's judgment.

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Issue:

Does a personal servitude of right of use terminate upon the holder's failure to tender a required monthly payment for a month in which the landowner also interfered with that use?

Opinions:

Majority - Peatross, J.

No. A personal servitude of right of use is not extinguished by the holder's failure to pay a required fee, particularly when the landowner has not fully performed their obligation to allow use of the servitude. The court characterized the right as a personal servitude of use, which is a transferable real right. The Civil Code provides specific ways for a servitude to terminate, such as destruction of the property or nonuse for ten years, neither of which apply here. The court found no support in the code for the argument that a servitude terminates for failure to pay an installment. The agreement itself was silent as to when payment was due. Applying the law of obligations, the court found that because McCormick interfered with and refused to allow Harrison full use of the track in October, McCormick failed to perform his own obligation and thus lost the right to demand payment for that month. Therefore, Harrison's failure to pay did not extinguish the servitude.

Analysis:

This decision clarifies that a servitude is a robust real right that cannot be easily extinguished by a minor failure to perform a condition, such as a fee payment. It establishes that courts will import principles from the general law of obligations to interpret servitude agreements that are silent on key terms like payment timing. The ruling prevents landowners from engineering a default by interfering with a servitude's use and then claiming the resulting non-payment as grounds for termination. This strengthens the position of servitude holders against servient estate owners who may wish to remove an encumbrance from their property.

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