Lakes of Gum Cove Hunting & Fishing L.L.C. v. Weeks Marine, Inc. , 145 F. App'x 949 ( 2005 )

United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT August 22, 2005
Charles R. Fulbruge III
Clerk
04-30634
LAKES OF GUM COVE HUNTING & FISHING L.L.C.; LAKES OF GUM COVE
LAND L.L.C.
Plaintiffs - Appellants
Versus
WEEKS MARINE, INC., ET AL.
Defendants
USA
Defendant - Appellee
Appeal from the United States District Court for the Western
District of Louisiana, Lake Charles
No. 2:00-CV-65
Before KING, Chief Judge, and DAVIS, Circuit Judge, and
ROSENTHAL, District Judge.*
PER CURIAM:**
Plaintiffs Lakes of Gum Cove Hunting & Fishing, L.L.C and
Lakes of Gum Cove Land, L.L.C. (collectively “LGC”) appeal the
*
District Judge of the Northern District of Texas, sitting
by designation.
**
Pursuant to 5TH CIR. R. 47.5, the court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
-1-
district court’s dismissal of their trespass claims against Weeks
Marine, Inc. (“Weeks”) and the United States for damages
allegedly resulting from the deposit of dredged material on LGC’s
property. Because the district court did not err in concluding
that LGC consented to the defendants’ entry onto LGC’s property,
we affirm the district court’s dismissal of plaintiffs’ trespass
action.
I.
In November 1998, two brothers, Anthony and Joseph Palermo,
formed LGC as a Louisiana limited liability company to purchase
land in Louisiana to lease for hunting and fishing. In December
1998, LGC purchased a tract of land in Cameron Parish, Louisiana,
bordering the Calcasieu River Ship Channel from Amoco Production
Company (“Amoco”). Included in the purchased property was Brown
Lake, which is located two miles west of the Calcasieu River and
south of Lake Charles. The deed included a provision notifying
the purchaser that the land was encumbered by a “Temporary
Easement or Servitude” that Amoco granted to the South Lake
Charles Harbor & Terminal District (“District”) so that the
district could finish dredging the Calcasieu River Ship Channel.
The dredging project was part of an ongoing jointly funded
state and federal project by the District and the United States
Army Corp of Engineers (“ACE”). Pursuant to the Calcasieu River
Ship Channel plan, dredged material from the Calcasieu River Ship
Channel was deposited on adjacent land to create cells to
-2-
minimize saltwater intrusion into Brown Lake. These deposits
were thought to have the added benefit of restoring the marshland
and improving the habitat for fish and other wildlife. The
dredging was conducted by the DREDGE TOM JONES pursuant to a
contract between ACE and Weeks, the owner of the dredging
vessel.1
In April 1999, the dredging project was not completed within
the period of the original easement between the District and
Amoco. Marc Rosamano (“Rosamano”), ACE’s attorney, drafted a
temporary right of entry entitled “Right of Entry for
Construction” (“Right of Entry”), so the project could continue.
Rosamano learned that the property was now owned by LGC, and
forwarded the Right of Entry instrument to both Palermo brothers.
After receiving the document, Anthony Palermo contacted Rosamano
to discuss the dredging project. After talking with Rosamano,
Anthony signed the Right of Entry, which granted the District and
its agents (which included Weeks and the ACE) the right to
continue depositing dredged material on LGC’s property for a
period of three months under the same terms and conditions as the
1
Phase I of the Calcasieu River Ship Channel plan was
completed in 1993, during which dredged material from the channel
was used to create five cells on the east side of Brown Lake.
Phase II of the project began in April 1998 according to the
easement obtained from Amoco, with the goal of creating three
cells on the west side of Brown Lake.
-3-
prior easement.2
The dredging project resumed on May 19, 1999, and continued
until Phase II was completed on June 28, 1999. Some time after
the dredging stopped, the Palermo brothers perceived a decline in
the amount of fish and other wildlife around Brown Lake. Because
the Palermos believed that the change was caused by the dredging
activities and the deposit of dredged material on their land,
they filed suit on behalf of LGC in October 1999 against Weeks,
the District, and the captain of the dredging vessel. LGC
alleged that, because the defendants did not obtain proper
consent to enter LGC’s property and dispose of the dredged
material, they committed trespass and were liable for any damages
resulting from their activity. According to the complaint, the
dredged material deposited on LGC’s property contained toxins and
pollutants that severely diminished the wildlife population on
the property, decreasing LGC’s ability to lease the property and
2
The Right of Entry provided in part:
The undersigned, hereinafter called the “Owner,”
in consideration of the work to be performed...for
servitude rights hereinafter described...grants an
irrevocable right to enter upon the lands...any time
within a period of three (3) months from the date of
this instrument, or until a new servitude agreement is
entered into, whichever is shorter, in order to do
work necessary to locate, construct, operate,
maintain, alter, repair and patrol a dredged material
disposal area, under the same terms and conditions as
the attached Temporary Easement or Servitude Agreement
dated April 28, 1998, which the [District] and the
Owner are in the process of renewing. R. 103.
-4-
generate income. LGC later filed a separate lawsuit against the
United States based on ACE’s participation in the dredging
activity, and the two cases were consolidated for trial.
Before trial, the district court granted ACE’s motion for
summary judgment and dismissed the claims against the United
States as time-barred, but found that the government must
indemnify Weeks for any damages Weeks was required to pay. The
court also dismissed the claims against the District and the
captain of the DREDGE TOM JONES.
The main issue at trial was whether LGC consented to the
defendants’ entry onto LGC’s property so as to defeat the
trespass claims.3 Following the bench trial, the district
court’s findings first considered whether Anthony Palermo’s
signature on the Right of Entry instrument as an agent for LGC
bound LGC to its terms. Because both LGC entities were limited
liability companies created in Louisiana, the district court
determined that Anthony’s ability to consent for LGC was governed
by Louisiana law. The court concluded that under Louisiana law,
an individual member of an L.L.C. can bind the company for all
3
In an earlier ruling the district court found that LGC’s
claims were properly labeled “marine trespass” claims governed by
the “general common law of trespass,” under which the court
applied the Second Restatement of Torts. The parties agree that
the landowner’s consent defeats a trespass under the Second
Restatement. See RESTATEMENT (SECOND) OF TORTS § 892A (1977) (“One
who effectively consents to conduct of another intended to invade
his interests cannot recover in an action of tort for the conduct
or harm resulting from it.”).
-5-
matters “in the ordinary course of business other than the
alienation, lease, or encumbrance of its immovables” unless
otherwise provided in the articles of organization.4 The court
concluded that if the articles of organization do not authorize
an individual member to alienate, lease, or encumber company
property, such actions require a majority vote of the company
members.5 The district court found that, because Anthony
Palermo’s signature on the Right of Entry did not purport to
alienate, lease, or encumber LGC’s immovable property, his lone
signature was sufficient to bind LGC to the terms of the
instrument, which allowed the defendants to enter the property
and continue to deposit dredged material onto LGC’s land. The
court held that such consent to enter the property defeated LGC’s
trespass claims as a matter of law, and rendered judgment for the
defendants. This appeal followed.
II.
LGC argues on appeal that the district court erred in
failing to classify the Right of Entry as an encumbrance under
Louisiana law, thus requiring the signatures of both Palermo
brothers to permit entry onto LGC’s property. Because the
instrument purporting to authorize the defendants to enter
4
LA. REV. STAT. § 12:1317 (A). LGC’s articles of organization
did not purport to enhance the authority of the members to
alienate, lease, or encumber company property.
5
LA. REV. STAT. § 12:1318 (B)(5).
-6-
company property was signed by only one member of LGC, LGC argues
that it was ineffective to grant defendants any right of entry.
The defendants argue that, even if the Right of Entry
purported to encumber company property, evidence in the record
demonstrates that both brothers consented to the defendants’
entry onto LGC’s property to deposit dredged material.
After reviewing the record, we agree with the defendants
that the evidence is uncontradicted that both Palermo brothers
consented to the defendants’ entry onto LGC’s property. It is
therefore unnecessary for us to decide whether the Right of Entry
purported to encumber LGC’s property.
The record shows that both Anthony and Joseph Palermo
participated in meetings in late 1998 with Clay Mitkiff, an
engineer with the ACE, to discuss the dredging project on LGC’s
property. According to Anthony Palermo’s testimony, Mitkiff
showed them drawings depicting the work already done and
described how the plan would create cells that would restore the
marshland. Joseph Palermo testified that, after meeting with
Mitkiff and several agents from the Department of Wildlife and
Fisheries to discuss dredging activities at Brown Lake, Anthony
was “all hipped up” by the fact that these projects would restore
the marshland without any cost to the landowner.6 Joseph stated
that although he was not as excited as his brother, he went along
6
1 Tr. at 120.
-7-
with the proposed plans because he believed they would improve
hunting and fishing around Brown Lake.
Anthony Palermo also testified that in May 1999, while bass
fishing in Brown Lake, he observed the defendants “bumping a
bunch of mud” into the middle of the marsh.7 He further
testified that it was clear to him at that point that the
defendants’ dredging activities had altered the character of the
marshland situated in Brown Lake. He admitted, however, that he
never contacted anyone from the District or the ACE to complain
that this activity was unauthorized.
Joseph Palermo testified that he first learned that the
defendants had resumed dredging operations when Anthony called
him after Anthony saw the above described activity while fishing
in Brown Lake. At the time of this conversation with Anthony,
Joseph stated that he knew from his earlier contacts with the
defendants that they wanted to continue depositing dredged
material on the property. Shortly after Anthony’s phone call
informing him of the defendants’ activity, Joseph flew over Brown
Lake and personally observed the dredging activity. Even after
observing the defendants’ activity, Joseph did not notify the
defendants that their presence on LGC’s property was unauthorized
or demand that they stop dredging operations at Brown Lake.
On August 24, 1999, the Palermo brothers hosted a barbecue
7
1 Tr. at 33-34.
-8-
at LGC’s facilities for the representatives from the ACE, the
District, and Weeks to discuss continuing dredging activities
into “Phase III.” Although both Anthony and Joseph Palermo were
present at the meeting and took part in the discussions regarding
further dredging activities on their company’s land, neither
voiced any concerns or notified any of the representatives
present that their work on Brown Lake was unauthorized. To the
contrary, the parties left the barbeque with a preliminary plan
in place to move ahead with “Phase III” of the dredging
operations at Brown Lake.
It is uncontradicted from all of the testimony that the
first time the Palermo brothers notified the defendants that they
objected to the defendants’ activity on LGC’s property was when
they filed this lawsuit in October of 1999. As the only members
of LGC, the Palermo brothers were the sole representatives of LGC
and the only persons with whom the defendants were able to
communicate about this project. The Palermo brothers’ conduct
before and after the dredging deposit operations clearly shows
that they consented to the defendants’ entry onto LGC’s land.8
This consent defeats LGC’s trespass claims.
III.
LGC also argues that any failure by the Palermos to object
8
This consent is not negated by uncommunicated reservations
the two brothers may have had about the effect the deposit of
spoil on their land might have on hunting and fishing.
-9-
to the defendants’ operations on LGC’s property was the result of
substantial misrepresentations from government employees to the
Palermos, and renders ineffective any possible consent to their
activities. LGC contends that, while meeting with the Clay
Mitkiff in 1998 to discuss the dredging project, the Palermo
brothers were told that the continued depositing of dredged
material at Brown Lake would enhance the population of fish and
other wildlife. LGC also contends that, while attempting to
secure the Right of Entry to extend dredging operations, Marc
Rosamano made similar predictions to Anthony Palermo. Because
these misrepresentations induced them to allow the dredging
project to continue, LGC argues, their consent was vitiated and
their trespass claims are not precluded.
Assuming that these predictions were made, the record simply
does not support a conclusion that the government representatives
knew or had reason to know that these statements were inaccurate,
which LGC must show to vitiate their consent in this context.9
9
See RESTATEMENT (SECOND) OF TORTS § 892B (1977) (“If the person
consenting to the conduct of another is induced to consent by a
substantial mistake concerning the nature of the invasion of his
interests or the extent of the harm to be expected from it and
the mistake is known to the other or is induced by the other’s
misrepresentation, the consent is not effective for the
unexpected invasion or harm.”); RESTATEMENT (SECOND) OF TORTS § 173
(1977) (“The rules stated in § 892B as to consent induced by
misrepresentation or mistake apply to entry or remaining on
land.”); RESTATEMENT (SECOND) OF TORTS § 526 (1977) (providing that a
fraudulent misrepresentation occurs when “the maker knows or
believes that the matter is not as he represents it to be, does
not have the confidence in the accuracy of his representation
that he states or implies, or knows that he does not have the
-10-
LGC concedes that the additional dredged material placed on the
property from 1993 to 1999 improved hunting and fishing at Brown
Lake. There is no evidence that any of the defendants’ employees
knew or should have known that the deposit of additional dredged
material would not continue to have the same positive effect. In
order to demonstrate that their consent was vitiated by the
defendants’ predictions, LGC was required to show that the
defendants either intentionally or negligently misrepresented
what effect the additional dredged material would have on hunting
and fishing at Brown Lake.10 Without such evidence, LGC’s
consent was effective and defeats their trespass claims.
IV.
For the reasons stated above, we AFFIRM the district court’s
judgment in favor of the defendants.
AFFIRMED.
basis for his representation that he states or implies”);
RESTATEMENT (SECOND) OF TORTS § 552 (1977) (providing that a
negligent misrepresentation occurs when “[o]ne who, in the course
of his business, profession or employment, or in any other
transaction in which he has a pecuniary interest, supplies false
information for the guidance of others in their business
transactions, is subject to liability for pecuniary loss caused
to them by their justifiable reliance upon the information, if he
fails to exercise reasonable care or competence in obtaining or
communicating the information”).
10
Id.
-11-
-12-