author: COOKS, Judge.

text:
    William O. BELT v. Tracy Bryant BELT
    16-136
    Court of Appeal of Louisiana, Third Circuit.
    September 28, 2016
    Rehearing Denied November 16, 2016
    Patrick B. Sadler, 2804 Hill Street, Alexandria, LA 71301, (318) 794-9016, ATTORNEY FOR PLAINTIFF/APPELLANT, William O. Belt
    Terry Aubin, Aubin Law Firm, 3600 Jackson Street, Suite 107, Alexandria, LA 71303, (318) 661-7000, ATTORNEY FOR DEFENDANT/APPELLEE, Tracy Bryant Belt
    Court composed of Sylvia R, Cooks, John D. Saunders, and Marc T. Amy, Judges.
   COOKS, Judge.

[ pWilliam Belt and Tracy Bryant Belt (hereafter Ms. Bryant) were married on December 11, 1992 in Avoyelles Parish, Louisiana. Mr. Belt was the Sheriff of Avoyelles Parish, retiring from that position on July 1, 2008. While employed as the Sheriff, Mr. Belt participated in the Louisiana Sheriffs Pension and Relief Fund. Upon his retirement in 2008, Mr. Belt had to choose which option to select from the Fund. He selected Option 2, which provided a reduced amount of monthly benefits, but provided a lifetime benefit for Ms. Bryant. Thus, by selecting Option 2, the maximum monthly benefit Mr. Belt was entitled to, $10,131.61, was reduced to $8,051.28. However, in the event Mr. Belt died first, Ms. Bryant would continue to receive that reduced amount for the remainder of her life.

After almost twenty years of marriage, Mr. Belt filed a Petition for Divorce on July 24, 2012. In response, Ms. Bryant filed an Answer and Reconventional Demand seeking child custody (the marriage produced three children), child support, interim spousal support and permanent spousal support. Ms. Bryant also sought to partition the community of acquets and gains existing between the parties.

The parties, through several consent judgments, resolved the issues of child custody, child support and spousal support. The parties were not able to reach an amicable resolution as to the community of acquets and gains.

A trial on the partition of the community was held, after which the trial court awarded Ms. Bryant 50% of the community property portion of Mr. Belt’s benefit in the Louisiana Sheriffs Pension and Relief Fund. The percentages established are not in dispute and it was determined Ms. Bryant was entitled to 28.19% of $8,051.28, the reduced benefit being paid to Mr. Belt. Mr. Belt protested, arguing he should be granted an offset for this amount against the $2,080.32 reduction of |shis lifetime benefits to establish Ms. Bryant’s lifetime entitlement. He argued the entire $2,080.32 should be reimbursed to him now that the parties are divorced if she refuses to relinquish bter present entitlement to 28.19% of the reduced retirement amount being paid to him. The trial court denied Mr. Belt’s reimbursement claim for the reduced portion of the maximum retirement benefit. '

Mr. Belt filed a Motion for New Trial which was denied by the trial court. This appeal followed, wherein Mr. Belt asserts the following assignments of error:

1. The trial court committed error when it assigned the lifetime benefit to Ms. Bryant but failed to assign the liability associated with the lifetime benefit payable to her upon Mr. Belt’s death.
2. The trial court committed error for failing to reimburse Mr. Belt for the reduced portion of his retirement benefit.
3. The trial court committed error for failing to assess’ Ms. Bryant with the entire reduction amount of $2,080.32, or the difference between the maximum retirement benefit of $10,131.61 and the reduced retirement benefit of $8,051.28, on all future withholdings,

-ANALYSIS

In his first assignment of error, Mr. Belt asserts the trial court erred when it held Ms. Bryant is entitled to have her “Option 2” survivor benefits, but failed to offset a liability associated with those benefits. We find this assignment of error is without merit.

The “Option 2” survivor benefit chosen by Mr. Belt is set out in La.R.S. 11:2178(I)(1), and provides, in pertinent part, as follows:

I. (l)(a) Upon application for service retirement, any participant may elect to receive benefits in a retirement allowance payable throughout life, or
(b) May elect at that time to receive the actuarial equivalent of the retirement allowance in a reduced retirement allowance payable throughout life with the following options, subject to the limitation that no member may elect an optional settlement in any amount in excess of the member’s final average compensation, after the reduction produced by the option selected:
| ¿Option 2. Upon the member’s death, a reduced retirement allowance shall be continued throughout the life of and paid to the spouse to whom the member was married and living with at the time of retirement.

Mr. Belt could have elected to receive the maximum, lifetime-only benefit, but chose instead to select “Option 2.” Under that option, the amount of the monthly benefit paid during the retiree’s lifetime is reduced, but that reduced amount is payable throughout the life of the spouse to whom the retiree was married and living with at the time of his retirement. Ms. Bryant is statutorily entitled to receive the survivor benefit because she was the spouse to whom Mr. Belt was married to at the time of his retirement.

We agree with Ms. Bryant that when Mr. Belt elected the option by which he would receive his retirement benefits, he did not. incur a community liability subject to partition. Any survivor benefits payable by Mr. Belt’s retirement plan, to the extent attributable to his employment during the community, are an asset of the community not a liability. Herrington v. Skinner, 93-1556 (La.App. 3 Cir. 6/1/94), 640 So.2d 748.

Ms. Bryant is Entitled to the survivor benefit provided in La.R.S. 11:2178(I)(1)(b), Option 2, that was selected by her then husband, and owes no reimbursement for it. No legislation or jurisprudence provides otherwise.

Mr. Belt argues both he and Ms. Bryant, together, selected Option 2. Whether that is true is irrelevant, as Mr. Belt had the sole authority to make the selection. He did so, and under La.R.S. 11:2178(I)(2) “no change in the option selected shall be permitted after the application has been officially filed with the board .... ” That Mr. Belt may now regret his choice does not change the law.

Mr. Belt suggests La.R.S. 11:2178(I)(3) provides Ms. Bryant with a way to voluntarily relinquish her right to the survivor benefit and avoid having to reimburse for the “cost” associated with the survivor benefit. It states:

|fi(3) If any option of this Subsection is selected, and the retiree’s spouse was designated as the beneficiary, and a judgment of divorce is rendered with respect to the retiree and the spouse, and, in connection therewith, the spouse, irrevocably, by court order, relinquishes the spouse’s survivorship rights under the option originally selected by the retiree, the originally selected option shall be considered revoked and the retiree shall be considered as retired under the maximum benefit, subject to reduction as hereinafter set forth, and without affording the retiree the right to select an option under which the retiree could designate a new beneficiary, and the benefit payable to the retiree shall be increased to the amount the retiree would have received had the retiree selected the maximum benefit, adjusted for any cost-of-living increases granted to the retiree, less any amount required as a result of such change in retirement status to render the new benefit to be the actuarial equivalent of the maximum benefit. The retiree shall be required to reimburse the system, by way of a onetime deduction from the retiree’s next benefit check, the reasonable cost incurred by the system to have these calculations made. The retiree shall be required to contractually hold the system harmless in the event that the former spouse ever successfully asserts a property right relative hereto which has any adverse effect upon the system. It shall be the responsibility of the retiree to notify the system of these circumstances, to present satisfactory evidence of same, and to request the recomputation of benefits. Adjustment of benefits under this Subsection shall not be retroactive, and shall be effective on the first day of the next month following official approval of the application for recompu-tation benefits.

We do not find the language of the statute supports Mr. Belt’s interpretation. As Ms. Bryant argues, if the legislature intended for La.R.S. 11:2178(I)(3) to provide the means for a non-employee spouse to relinquish the survivor benefit that by law applies to her alone, in order to avoid a “cost” associated with that benefit, it could easily have provided so. It did not.

Mr. Belt notes in the event the non-employee spouse voluntarily relinquishes the survivor benefit, the monthly benefit paid to the retiree spouse reverts back to the maximum, lifetime only benefit. He asserts this is so because there is a cost associated with the survivor benefit which should be borne by the party that benefits from the survivor benefit. We disagree. The statute plainly provides all of the benefit payment options are actuarially equivalent. See La.R.S. 11:2178(I)(1)(b). That is why in the event a non-employee spouse voluntarily relinquishes the survivor benefit, the retiree spouse is returned to the maximum, lifetime only benefit. This maintains the needed actuarial equivalence.

In his second and third assignments of error, Mr. Belt attempts to extend Sims v. Sims, 358 So.2d 919 (La.1978), to create a reimbursement obligation for the lifetime benefit resulting from his election of the Option 2 survivor benefit. In his argument, Mr. Belt continues to argue the selection of Option 2 and the subsequent reduction in the amount of benefits constitutes a liability incurred. He then uses the Sims formula to calculate his separate property interest in each foregone monthly payment. As Ms. Bryant argues, this is a misapplication of Sims

Sims is a jurisprudential tool which the courts have used to classify and allocate lifetime pension benefits. No court has ever interpreted Sims to apply to reimbursement. Moreover, as Ms. Bryant notes, the courts have never interpreted the Louisiana Civil Code’s reimbursement articles to make a spouse pay for the survivor benefit which the other spouse selected.

As Ms. Bryant notes, this was not an extrajudicial partition, where the parties negotiated or traded certain rights or benefits. There was absolutely no agreement that Ms. Bryant would relinquish the survivor benefit in exchange for something else. The law simply does not provide any avenue for the relief which Mr. Belt seeks.

DECREE

For the foregoing reasons, the judgment of the trial court is affirmed. All costs of this appeal are , assessed against plaintiff-appellant, William Belt.

AFFIRMED.


source: Caselaw Access Project

author: PITMAN, J.

license: Public Domain

text:
    Nadja ASHLEY, et al, Plaintiffs-Appellees v. STATE of Louisiana, LSUHSC-Shreveport, Defendant-Appellant
    No. 51,041-CA
    Court of Appeal of Louisiana, Second Circuit.
    Judgment rendered November 16, 2016

      TAYLOR, PORTER, BROOKS & PHILLIPS, L.L.P., By: Thomas R. Peak, M. Lenore Feeney, Counsel for Appellant
    THE SMITH LAW OFFICE, L.L.C., By: Linda Lea Smith, Eskridge E. Smith, Jr., Counsel for Appellees
    Before BROWN, WILLIAMS & PITMAN, JJ.
   PITMAN, J.

| ] Plaintiffs, 88 former employees of Louisiana State University Health Sciences Center in Shreveport (“LSUHSC-S”), and Defendant, the Board of Supervisors of Louisiana State University and Agricultural and Mechanical College (“LSU”), appeal the judgment of the trial court finding that Plaintiffs are entitled to payment for annual leave balances in excess of 300 hours, penalties and attorney fees; finding that Plaintiffs are not entitled to sick leave; and denying LSU’s exception of no cause of action. For the following reasons, we affirm in part and reverse in part.

FACTS

On September 10, 2014, Plaintiffs filed a petition for a rule to show cause for payments due to terminated employees, stating that their employment with LSUHSC-S terminated on September 30, 2013, when LSUHSC-S and the Department of Health and Hospitals entered into a private partnership with the Biomedical Research Foundation of Northwest Louisiana for management and operation of University Hospital. They explained that approximately 2,047 job positions were terminated, which left no state employees remaining at University Hospital. They alleged that LSUHSC-S failed to provide payment of all amounts due to the terminated employees because LSU required them to forfeit all earned and accrued annual leave (i.e., vacation or personal leave time) in excess of 300 hours and all earned and accumulated sick leave. They contended that they are entitled to payment from LSUHSC-S for all wages, including benefits earned up to the time of the termination of employment, and to recover | gpenalties, attorney fees and interest as a result of LSUHSC-S’s failure to timely pay the amounts due upon termination of employment.

On April 13, 2015, LSU filed an answer and peremptory exception of no cause of action. LSU denied the allegations made by Plaintiffs, except that it did admit that Plaintiffs were laid off, as approved by the Louisiana State Civil Service Commission, and their employment with LSUHSC-S was terminated, effective September 30, 2013. It stated that, on October 9, 2013, many, if not all, Plaintiffs appealed to the State Civil Service Commission and alleged that LSUHSC-S violated La. R.S. 23:631 et seq., and Civil Service Rule 11.10 by not paying them the value of all their sick and annual leave. It noted that the State Civil Service Commission summarily dismissed Plaintiffs’ appeal and stated that LSUHSC-S did pay them for their annual leave as required by Rule 11.10, which states that no terminal payment for annual leave shall exceed the value of 300 hours. It argued that LSUHSC-S paid to each Plaintiff the amount due under the terms of employment in full compliance with La. R.S. 23:631 et seq., and explained that, as state employees in the classified service, they were allowed payment of not more than 300 hours of annual leave and cancellation of all accrued sick leave. Therefore, LSU argued that Plaintiffs failed to state a claim upon which relief could be granted because LSUHSC-S paid Plaintiffs all amounts of sick and annual leave due to them.

On April 22, 2015, the parties filed a joint stipulation of facts and exhibits. The parties stipulated that LSU provided payment to all Plaintiffs of their cash wages due and their accumulated annual leave, up to 300 hours, following termination by layoff on September 30, 2013. The parties also stipulated that LSU failed to respond or provide tender or payment to | ¡¡Plaintiffs for the accrued annual leave balances in excess of 300 hours and for the accrued sick leave balances. The parties further stipulated that the State Civil Service Commission denied a claim filed by Plaintiffs, stating that it did not have jurisdiction over claims under La. R.S. 23:631. The parties also stipulated to the pertinent Civil Service Rules and to Plaintiffs’ hourly rates of pay and accrued annual leave and sick leave balances.

On July 27, 2015, a hearing was held on Plaintiffs’ petition for a rule to show cause. Counsel for both parties presented arguments. The trial court noted that La. R.S. 23:631 was amended in 1997; and, under the current statute, Part D(2) states: “The provisions of this Subsection shall not be interpreted to allow the forfeiture of any vacation pay actually earned by an employee pursuant to the employer’s policy.” The trial court stated that the employees could earn an unlimited amount of vacation time and reasoned that “[i]f they earn it, they can’t forfeit it, therefore, whether it’s 300 hours, 500, 600, whatever hours, they have a right to be paid for it.” It noted that La. R.S. 23:631 does not address sick leave and stated that the relevant Civil Service Rule applies to sick leave in this situation. It found that, because the employees had not been paid the additional amounts due to them, they are entitled to penalties and attorney fees in connection with the vacation pay only, not the sick pay.

On November 16, 2015, a hearing was held on the issues of calculation of the attorney fee award and the penalty award. The trial court found that 24 of the Plaintiffs worked 12-hour shifts for purposes of the penalty wage award calculation. Counsel for Plaintiffs testified about her work in this case, that one other attorney worked with her, that they undertook representation of Plaintiffs on a contingent basis and that the fee 14arrangement was on a sliding scale — 20 percent if the case was resolved with Civil Service and 30 percent if the Civil Service case was appealed or if the case went to the district court. Noting the number of litigants involved and the amount of work performed over a two-year period in this case, the trial court granted Plaintiffs’ counsel the contingency fee of 30 percent.

On December 8, 2015, the trial court signed a judgment on the issues heard on July 27 and November 16, 2015. It found that Plaintiffs were entitled to payment for their annual leave balances in excess of 300 hours, together with penalty wages and attorney fees. It also found that the penalty award for those Plaintiffs who regularly worked 12-hour shifts should be calculated based on a 12-hour work day. It further found that a 30 percent contingency fee based on the total award in favor of Plaintiffs was a reasonable attorney fee. It denied all other claims and denied LSU’s exception of no cause of action. It awarded legal interest in favor of Plaintiffs and assessed costs against LSU.

LSU and Plaintiffs appeal.

DISCUSSION

No Cause of Action

In its first assignment of error, LSU argues that the trial court erred in denying its exception of no cause of action. It contends that, pursuant to Civil Service Rules, the total amount of pay actually earned by Plaintiffs for their unused accrued leave was limited to the value of up to 300 hours of annual leave at the hourly rate of pay in effect upon the date of their termination of employment. It also contends that any unpaid hours of accrued leave remaining after the terminal payment had no monetary value and are not earned wages within the meaning of La. R.S. 23:631 and 23:634. |RIt argues that there is no dispute or genuine issue of fact as to whether it paid each Plaintiff the amounts required under the express terms of the employment contract as set forth in the Civil Service Rules. Thus, LSU contends that Plaintiffs failed to state a cause of action against it.

Plaintiffs argue that the trial court’s denial of the exception of no cause of action should be affirmed. They state that the trial court correctly applied La. R.S. 23:631 et seq., to their claims for the unpaid leave they earned and accrued as state civil service employees. They contend that their claims are not preempted by Civil Service Rules.

The function of the exception of no cause of action is to question whether the law extends a remedy to anyone under the factual allegations of the petition. Louisiana Paddlewheels v. Louisiana Riverboat Gaming Comm’n, 94-2015 (La. 11/30/94), 646 So.2d 885. It is designed to test the legal sufficiency of the petition by determining whether the law affords a remedy on the facts alleged in the pleading. Everything on Wheels Subaru, Inc. v. Subaru S., Inc., 616 So.2d 1234 (La. 1993). No evidence may be introduced at any time to support or controvert the objection that the petition fails to state a cause of action. La. C.C.P. art. 931. The exception is triable on the face of the papers and for the purposes of determining the issues raised by the exception, the well-pleaded facts in the petition must be accepted as true. City of New Orleans v. Bd. of Comm’rs of Orleans Levee Dist., 93-0690 (La. 7/5/94), 640 So.2d 237. In reviewing a trial court’s ruling on an exception of no cause of action, the court of appeal should subject the case to de novo review because the exception raises a question of law and the lower court’s decision is based only on the sufficiency of the petition. Id.

IfiLa. R.S. 23:631(A)(l)(a) states in pertinent part:

Upon the discharge of any laborer or other employee of any kind whatever, it shall be the duty of the person employing such laborer or other employee to pay the amount then due under the terms of employment, whether the employment is by the hour, day, week, or month, on or before the next regular payday or no later than fifteen days following the date of discharge, whichever occurs first.

La. R.S. 23:631 extends a remedy, i.e., payment of an amount due under the terms of employment, to terminated employees alleging that they were not paid amounts due upon termination of employment.

Accoi’dingly, this assignment of error lacks merit.

Award for Annual Leave in Excess of the Value of 300 Hours

In its second assignment of error, LSU argues that the trial court erred in awarding Plaintiffs amounts for unpaid annual leave in excess of the value of 300 hours, contrary to Civil Service Rules and in violation of the exclusive jurisdiction of the State Civil Service Commission. It states that the Louisiana Constitution vests the State Civil Service Commission with exclusive authority to establish a uniform pay and classification plan and to adopt rules governing compensation and disbursements to employees. It argues that these rules establish the terms of employment applicable to Plaintiffs and critical to the determination of whether it violated La. R.S. 23:631 et seq. It also argues that, pursuant to Civil Service Rules 11.10(b) and 11.18, the accrued unused annual leave in excess of the value of 300 hours and the accrued unused sick leave were not amounts then due under the terms of employment. It contends that payments with respect to the cancelled annual and sick leave are not owed to Plaintiffs and cannot be recovered by Plaintiffs from LSU.

17PIaintiffs argue that the trial court correctly awarded payment of unpaid accrued annual leave, penalty wages and attorney fees. They contend that the constitutional grant of authority to the State Civil Service Commission does not prohibit or bar a claim under La. R.S. 23:631.

Although LSU suggests that La. R.S. 23:631 et seq., infringe upon the exclusive jurisdiction of the State Civil Service Commission, we note that there is no conflict between the Civil Service Rules and La. R.S. 23:631 et seq., in this case. La. Const. Art. 10, § 10(A)(1)(a) vests the State Civil Service Commission with

broad and general rulemaking and subpoena powers for the administration and regulation of the classified service, including the power to adopt rules for regulating ... employment conditions, compensation and disbursements to employees, and other personnel matters and transactions; to adopt a uniform pay and classification plan. ...

La. R.S. 23:631 et seq., do not affect the “administration and regulation of the classified service” as contemplated by La. Const. Art. 10, § 10(A)(1)(a). The Civil Service Rules apply during the employment of classified employees, and La. R.S. 23:631 et seq., provide employees with a cause of action after termination of employment. The Civil Service Rules and La. R.S. 23:631 et seq., both apply in this case.

Plaintiffs’ “terms of employment” as contemplated in La. R.S. 23:631 are set forth in the Civil Service Rules.

Civil Service Rule 11.10 states in part: (a) Subject to Rule 11.18(a) and subsection (b) of this rule, each employee upon separation from the classified service shall be paid the value of his accrued annual leave in a lump sum disregarding any final fraction of an hour; provided, that the privileges of this rule shall not extend to any employee who is dismissed for theft of agency funds or property. The payment for such leave shall be computed as follows:

Isl. When an employee is paid wages on an hourly basis, multiply his regular hourly rate by the number of hours of accrued annual leave.
2. When an employee is paid on other than an hourly basis, determine his hourly rate by converting his salary in accordance with provisions in the uniform pay plan for conversion to a working hourly rate. Multiply his converted hourly rate by the number of hours of accrued annual leave.
(b) No terminal payment for annual leave earned under these Rules shall exceed the value of 300 hours, computed on the basis of the employee’s hourly rate of pay (includes base supplement) at the time of his separation. The hourly rate of pay for employees who are on detail shall not include the employee’s pay in the detail position.
(c) No payment for annual leave under this Rule shall operate to continue the payee as a classified employee beyond the last day of active duty.

Rule 11.18(a) states in part that “[w]hen an employee separates from the state classified service, all accrued annual leave except that which must be paid and all accrued sick leave except that which must be paid under Rule 11.10.1 shall be cancelled.”

La. R.S. 23:631(D) states:

D.(l) For purposes of this Section, vacation pay will be considered an amount then due only if, in accordance with the stated vacation policy of the person employing such laborer or other employee, both of the following apply:
(a) The laborer or other employee is deemed eligible for and has accrued the right to take vacation time with pay.
(b) The laborer or other employee has not taken or been compensated for the vacation time as of the date of the discharge or resignation.
(2) The provisions of this Subsection shall not be interpreted to allow the forfeiture of any vacation pay actually earned by an employee pursuant to the employer’s policy.

Pursuant to La. R.S. 23:631(A)(l)(a), LSU was required to pay to Plaintiffs upon their termination “the amount then due under the terms of employment.” As set forth in Civil Service Rule 11.10, Plaintiffs were entitled to payment of the value of their accrued annual leave, but this payment was limited to the value of 300 hours. La. R.S. 23:631(D) does not 19require LSU to pay Plaintiffs for the value of annual leave in excess of 300 hours because this excess amount is not an amount “actually earned by an employee pursuant to the employer’s policy.” The parties stipulated that LSU provided payment to all Plaintiffs of their cash wages due and their accumulated annual leave, up to 300 hours, following termination of employment. Therefore, LSU did not violate La. R.S. 23:631 because it fully paid to Plaintiffs “the amount then due under the terms of employment.” Thus, we find that the trial court erred in determining that Plaintiffs were entitled to payment for their annual leave balances in excess of 300 hours, that LSU violated La. R.S. 23:631 and that Plaintiffs were also entitled to payment of penalty wages and attorney fees.

Accordingly, this assignment of error has merit.

Penalty Wages and Attorney Fees

In LSU’s remaining assignments of error, it argues that the trial court erred in awarding penalty wages and attorney fees to Plaintiffs under La. R.S. 23:632.

La. R.S. 23:632 states:

A. Except as provided for in Subsection B of this Section, any employer who fails or refuses to comply with the provisions of R.S. 23:631 shall be liable to the employee either for ninety days wages at the employee’s daily rate of pay, or else for full wages from the time the employee’s demand for payment is made until the employer shall pay or tender the amount of unpaid wages due to such employee, whichever is the lesser amount of penalty wages.
B. When the court finds that an employer’s dispute over the amount of wages due was in good faith, but the employer is subsequently found by the court to owe the amount in dispute, the employer shall be liable only for the amount of wages in dispute plus judicial interest incurred from the date that the suit is filed. If the court determines that the employer’s failure or refusal to pay the amount of wages owed was not in good faith, then the employer shall be subject to the penalty provided for in Subsection A of this Section.
|I0C. Reasonable attorney fees shall be allowed the laborer or employee by the court which shall be taxed as costs to be paid by the employer, in the event a well-founded suit for any unpaid wages whatsoever be filed by the laborer or employee after three days shall have elapsed from time of making the first demand following discharge or resignation.

As stated above, LSU fully complied with La. R.S. 23:631 and paid Plaintiffs “the amount then due under the terms of employment,” i.e., annual leave up to the value of 300 hours. Because Plaintiffs were not entitled to the value of annual leave in excess of 300 hours and to sick leave, LSU did not violate La. R.S. 23:631. Therefore, Plaintiffs are not entitled to penalty wages and attorney fees as contemplated in La. R.S. 23:632.

Accordingly, these assignments of error have merit.

Sick Leave

In their first assignment of error, Plaintiffs argue that the trial court erred in not awarding payment of earned and accrued sick leave, together with associated penalty wages and attorney fees. They liken sick leave to annual leave and state that they earned and accrued leave for which they were entitled to be paid under La. R.S. 23:631 et seq.; and, therefore, LSU violated La. R.S. 23:631 et seq., by cancelling the leave and refusing payment.

LSU argues that sick leave is not the same as vacation pay under La. R.S. 23:631 et seq., or Civil Service Rules. It states that it did not pay Plaintiffs for any unused accrued sick leave because Civil Service Rules required that it cancel the sick leave. It contends that sick leave is not an amount due under the terms of employment and that Plaintiffs have no right of action to recover the value of the accrued unused sick leave.

In As discussed above, La. R.S. 23:631(A)(l)(a) requires that the employer pay the employee “the amount then due under the terms of employment.” In this case, the terms of Plaintiffs’ employment with LSU are set forth in the Civil Service Rules. Several of the Civil Service Rules specifically address sick leave, including Rules 11.13 and 11.14. Most significantly to this case, Rule 11.18 states in part that “[w]hen an employee separates from the state classified service, ... all accrued sick leave except that which must be paid under Rule 11.10.1 shall be cancelled.” Therefore, the trial court did not err in determining that Plaintiffs are not entitled to sick leave.

Accordingly, this assignment of error lacks merit.

Increased Award

In their second assignment of error, Plaintiffs argue, in the alternative, that, if the court on appeal determines that the terminal payment is gratuitous or for severance payment and not payment for the earned annual leave, then the award for payment of earned and accrued annual leave, together with the penalty and attorney fees, should be increased.

This court did not determine that the terminal payment is gratuitous or for severance payment. Upon termination of employment, LSU properly paid to Plaintiffs the amount then due under the terms of employment, i.e., the cash wages due and their accumulated annual leave, up to 300 hours.

Accordingly, this assignment of error lacks merit.

I ^CONCLUSION

For the foregoing reasons, we affirm the trial court’s denial of LSU’s exception of no cause of action. We also affirm the portion of the trial court’s judgment that determined that Plaintiffs are not entitled to payment for sick leave. We reverse the portions of the trial court’s judgment that determined that Plaintiffs were entitled to payment from LSU for the value of annual leave balances in excess of 300 hours, penalty wages and attorney fees. Costs are assessed to Plaintiffs.

AFFIRMED IN PART AND REVERSED IN PART.

      . In Plaintiffs’ petition, they named LSUHSC-S as Defendant; but, in its answer, LSU stated that Plaintiffs erroneously named LSUHSC-S as Defendant.

      . The circumstances contemplated in Civil Service Rule 11.10.1 do not apply to the case sub judice.


author: MOORE, J.'

text:
    Charlotte Gish KENNEDY, Jimmy Paul Kennedy, Ruth Carol Shepard, Roy D. Gish & Rena Evans Gish, Plaintiff-Appellees v. Mohamed “Jack” SAHEID, Defendant-Appellant
    No. 51,044-CA
    Court of Appeal of Louisiana, Second Circuit.
    November 16, 2016

      BLANCHARD, WALKER, O’QUIN, & ROBERTS, By: Scott R. Wolf, Paul M. Adkins, Counsel for Appellant
    KEVIN W. HAMMOND, Counsel for Appellees
    Before WILLIAMS, MOORE and LOLLEY, JJ.
   MOORE, J.'

hMohamed “Jack” Saheid appeals a judgment that recognized Roy Gish as the owner of a 12 ⅜% mineral interest in a 1,096-acre tract of land in north Caddo Parish that Saheid purchased from Gish by three transactions in 2004 and 2008. For the reasons expressed, we affirm.

Factual Background

Saheid, an investor then living in Worth-ing, England, testified that in 2004 he was trying to buy a hotel in New Orleans. When that deal fell through, a real estate agent suggested buying an oil and gas field in north Louisiana.- A broker named Carl David got in touch with Gish, who was then living in Belcher and was interested in selling his 1,096-acre tract of land complete with about 600 oil and gas wells. After several phone conferences, Saheid faxed to David an undated offer (“the Offer”) to buy the property for $4 million “for 100% ownership,” with $200,000 down and the remainder to be owner-financed over five years.

On October 9, 2004, Saheid and Gish signed a one-page, unnotarized agreement (“the Agreement”) with respect to “Real Estate transaction involving 1,096 acres, including all oil and gas leases, rent houses, all structures and other equipment as stated in previous documents, located at 9886 N Hwy 169, Belcher, Louisiana.” The Agreement included this final provision:

Other: SELLER to give a best effort to deliver to BUYER the remaining 12 ⅜% GISH family oil and gas lease holding.

On November 2, 2004, the parties met at First Title Corporation in Metairie, Louisiana, and executed an authentic act entitled Act of Credit Sale and Assignment of Oil, Gas and Mineral Leases, Rights to Pipelines and LWells and Gathering Systems, and Equipment Leases (“the Act of Credit Sale”). The Act of Credit Sale recited that Gish and “The Roy D. Gish and Norma L. Gish Charitable Remainder Unitrust” conveyed “ALL THAT CERTAIN LOT OR PARCEL OF GROUND,” with all rights, ways, servitudes and component parts, to Saheid. The Act of Credit Sale included a special provision (“Paragraph K”) that stated:

K. The Trust and Purchaser acknowledge and agree that the Trust has represented to the Purchaser that the Trust is the sole and only owner of an undivided 87.5% interest in and to the leases assigned herein. Should that representation be incorrect, and should any claim be successfully asserted against the interest conveyed by the Trust to the Purchaser, then, and in that event, the purchase price attributable to said leases shall be reduced by the sum of [$400,-000], without the necessity of the modification of this agreement and/or the execution of any other documents, provided, however, that any such claim be asserted on or before November 80, 2009.

Gish testified that he received, and Sa-heid confirmed that he paid, the 12 ⅜% mineral royalty for almost four years, until early 2008. To resolve this and other points of dispute, the parties executed an authentic act labeled “Contract,” on April 24, 2008. Gish agreed to reduce Saheid’s monthly payment, to suspend payments for three months, and to allow Saheid to enter mineral leases without Gish’s consent. Saheid agreed to dismiss a federal suit against Gish and his family trust, and to delete Paragraph K in its entirety from the Act of Credit Sale. The Contract included this additional provision (“Paragraph 2(d)”):

2. Buyer shall: * * *
d) Waive and relinquish all rights to reduce the purchase price based on any claim that the percentage interest in any land ownersf] royalty interest or leases assigned to buyer were less than what has been represented by seller * * *. Buyer consents to and acknowledges that seller has and shall continue to withhold a 6.25% royalty for the Kennedy family and a 6.25% royalty to Ruth Sheppard et al, on the 1,096 acres.

IsGish testified that the final payment he received was for May 2008 royalties; Department of Conservation records showed that Saheid shut in the wells for four months, and then signed a paid-up mineral lease wherein the lessee paid all royalties to Saheid, and none to Gish, his family members or the trust. Gish and his family members sent demand letters in January and October 1009, but Saheid never paid them their claimed 12 ½%.

Gish, joined by his mother, Charlotte, his sister, Ruth (and her husband), and his own wife, Rena, filed this suit against Sa-heid in March 2010. He sought recognition of the plaintiffs’ respective 6 ¾% (total 12 ½%) royalty interests, an accounting, sequestration of all proceeds, and double damages under La. R.S. 31:212.21.

Evidence at Trial

After extensive discovery and cross-motions for summary judgment, the case came to trial in August 2015. Observing that Gish was the only plaintiff to appear in court, Saheid moved for involuntary dismissal of all other plaintiffs, La. C. C. P. art. 1672 A(l). Gish agreed as to his wife, his sister and her husband, and they were dismissed without prejudice, but Gish claimed the whole 12 ½%, not just his mother’s 6 ⅛%. Saheid filed an exception of no right of action as to the sister’s 6 ⅜%; the court referred this to the merits.

Four witnesses testified. Carl David, the broker, testified that he recalled the Agreement and was present when the Act of Credit Sale was executed. The deal was that Saheid was buying 100% of the tract except for this 12 ½% mineral interest. In the Agreement, Gish was going to try to convince his mother and sister to sell their share, and in the Act of Credit Sale, they added Paragraph K because they could not get a definite title Ropinion as to ownership of the minerals, but Saheid was very unhappy about not getting all the minerals. Over time, the relationship strained, in David’s view, because Saheid thought Gish was trying to get the property back and run it dry, while Gish thought Saheid just was not paying him. They executed the Contract in a lawyer’s office, at which time David thought they had resolved all differences. However, David learned that a potential lessee had advised Saheid that the family’s 12 ½% interest was not recorded, so Saheid stopped paying. David felt that Paragraph 2(d) reiterated that, of the mineral interest, all Gish had ever sold and all Saheid had ever bought, was 87 ½%. On cross-examination, David admitted that he had done no independent research as to whether Gish’s family had a recorded 12 ½% mineral interest, and agreed that the Contract was “poorly drafted.”

Gish, who now lives in New Boston, Texas, testified that the original deal was to sell the land and minerals outright for $4 million, but Saheid could not get financing. They therefore settled on owner financing with a retention of 12 ½% mineral interest for his mother and sister, a point accurately stated (in Gish’s view) in the Agreement and in Paragraph K. Gish also testified that since he bought out his brother, he was full owner of the land, surface and minerals, and had established the trust for tax purposes, but this did not affect the 12 ⅜% retention. Gish insisted that his intent was to sell only 87 ⅜% of the minerals, as reflected in the Agreement, the Act of Credit Sale and the Contract, and confirmed by the fact that Saheid paid him 12 ½% mineral royalties for nearly four years.

On cross-examination, Gish admitted he had no written agreement to share royalties with his mother and sister, they had no contract with Saheid, and none of the documents defined “Kennedy family” or his sister “et al.” |5He also conceded that in February 2009, he and Saheid executed, under private signature, a four-page Act of Correction, which made no mention of the 12 ½% retention; however, this document merely made small adjustments to the property description and did not affect the percentage of interest conveyed. He also admitted that in November 2008, he signed, for purposes of Texas state taxes, an Affidavit of Possession swearing that he sold the “entire working interest” in the Caddo Parish wells and the entire mineral estate. However, he also showed his handwritten addendum, “royalty payments of 12 ⅜% from 100% of mineral rights,” half each to his sister and mother. On redirect, he admitted he should have recorded his family’s 12 ½% interest, but felt that as record owner of 100%, he could sell any portion of it he wished.

Saheid, who now lives in Midland, Texas, testified that he had bought property before but never mineral interests. He hand-wrote the Offer and faxed it to David, expecting to buy the land and minerals outright for $4 million, and was unaware of the 12 ⅝% being “claimed by” the Gish family. He recalled Gish telling him he could not sell the 12 ⅜% because his family owned it; being unfamiliar with Louisiana law, he trusted Gish’s representation. Sa-heid never intended to give 12 ½% to the Gish family, and explained Paragraph K by saying he was “very confused quite frankly in New Orleans.” He signed it because he wanted to get $400,000 off the purchase price, and felt it was Gish’s duty to pay his mother and sister their share out of whatever he (Gish) received. Saheid confirmed that in 2008, a prospective lessee advised him the family’s royalty interest was not recorded in Caddo Parish, so he quit paying; Gish responded by “stealing” pipes and equipment from the oilfield, Saheid filed a writ of sequestration, resulting in |fia “very unfortunate affair.” Saheid also admitted signing the Contract, but his intention was not to transfer any royalty interest to Gish or to pay any royalties. He thought it significant that the Act of Correction, which they signed in February 2009, was totally silent as to the 12 ⅜%, and felt this confirmed his original intent to buy the minerals outright.

On cross-examination, Saheid admitted not hiring an attorney to run a title search before he signed the Agreement, .the Act of Credit Sale and the Contract, and agreed he should have done so. He candidly admitted, “Mr. David mentioned the fact that Mr. Gish was only selling me 87 ½%,” and moments later, referring to Paragraph 2(d), “I see nothing wrong with that. * * * It’s a fact, I mean, I agreed to it.”

William Reed Huguet, an attorney at Kean Miller LLP and a former landman, was accepted as an expert in “title opinion on mineral lease ownership” and testified on Saheid’s behalf. He had examined the public records and, as of 1995, Gish owned the tract and the minerals outright, with no trust or mineral servitudes affecting it. Huguet had searched diligently and could not find the outstanding 12 ⅜% mineral interest at issue; he therefore concluded that it did not exist. On cross-examination, he conceded his title search had not turned up the Agreement, which preceded the Act of Credit Sale. He initially said it was not relevant, but admitted that as the 100% owner, Gish could sell 87 ½% and keep the rest, if the instrument contained a specific reservation of interest.

Action of the District Court

On October 26, 2015, the court delivered oral reasons. The court cited the Agreement (which referred to a 12 ⅜% mineral interest “remaining”), the Act of Credit Sale (“an undivided 87.5% interest in and tojjthe leases assigned herein”) and the Contract (“seller has and shall continue to withhold” two 6 ⅝% shares). The court also found the parties ■ conceded the Contract was “inartfully drafted” and that the “mineral interests wei’e not reserved as they should have been.” Because of the ambiguity, the court accepted the parol evidence and the recurrent reference to “12.5 mineral interest being withheld.” The court further found that Saheid’s compliance with the 12 ⅜% retention for several years supported the intent of the parties. The court therefore recognized Gish’s ownership of 12 ½% of the minerals and ordered an accounting.

The written judgment, issued in January 2016, expressed these holdings and also denied Saheid’s exception of no right of action.

Saheid has appealed, raising four assignments of error. His main thesis is that the plaintiffs did not reserve any mineral interests when they sold the property to Saheid; the transfer documents did not set forth any reservation of 12 ½% interest; and the court committed manifest error in finding ambiguity and admitting parol evidence.

Applicable Law

In the context of mineral rights, just as in other contexts, the interpretation of contracts is the determination of the common intent of the parties. La. C.C. art. 2045; Olympia Minerals LLC v. HS Resources Inc., 2013-2637 (La. 10/15/14), 171 So.3d 878; Quality Envtl. Processes v. LP Petroleum Co., 2013-1582 (La. 5/7/14), 144 So.3d 1011. Courts give the contractual words their generally prevailing meaning unless the words have acquired a technical meaning. La. C.C. art. 2047. When the words of a contract are clear and explicit and lead to no absurd consequences, no further interpretation may be made in search of the intent of the parties. La. C.C. art. 2046; Mack Energy Co. v. Expert Oil & Gas LLC, 2014-1127 (La. 1/28/15), 159 So.3d 437; Clovelly Oil Co. v. Midstates Petroleum Co., 2012-2055 (La. 3/19/13), 112 So.3d 187.

Parol or extrinsic evidence is generally inadmissible to vary the terms of a written contract unless the written expression of the common intent of the parties is ambiguous. Campbell v. Melton, 2001-2578 (La. 5/14/02), 817 So.2d 69; BRP LLC (Delaware) v. MC La. Minerals LLC, 50,-549 (La.App. 2 Cir. 5/18/16), 196 So.3d 37. A contract is deemed ambiguous on the issue of intent when either it lacks a provision bearing on that issue, the terms of the contract are susceptible to more than one interpretation, there is uncertainty or ambiguity as to its provisions, or the intent of the parties cannot be ascertained from the language used. La. C.C. art. 1848; Campbell v. Melton, supra; Franklin v. Camterra Res. Partners Inc., 48,021 (La.App. 2 Cir. 5/22/13), 123 So.3d 184, 181 Oil & Gas Rep. 348.

The parol evidence rule applies to mineral rights just as it does to real estate rights. Hayes v. Muller, 245 La. 356, 158 So.2d 191 (1963); Texas Gen’l Petroleum Corp. v. Brown, 408 So.2d 288 (La. App. 2 Cir. 1981). A landowner may convey, reserve or lease his right to explore and develop his land for production of minerals and to reduce them to possession. La. R.S. 31:15; Doyal v. Pickett, 628 So.2d 184, 129 Oil & Gas Rep. 24 (La. App. 2 Cir. 1993); Hayden v. Phillips, 94-0130 (La.App. 1 Cir. 11/10/94), 646 So.2d 1014, 133 Oil & Gas Rep. 41, writ denied, 95-0244 (La. 3/24/95), 651 So.2d 291.

Credibility determinations are within the district court’s discretion and should not be disturbed on review where conflict exists in the testimony absent a determination that the district court abused its discretion. Lomont v. Bennett, 2014-2483 (La. 6/30/15), 172 So.3d 620; Stobart v. State, 617 So.2d 880 (La. 1993). Only where documents or objective evidence so contradict the witness’s story, or the story itself is so internally inconsistent or implausible on its face that a reasonable factfinder would not credit it, may the court of appeal find manifest error or clear wrongness even in a finding purportedly based on a credibility determination. Lomont v. Bennett, supra; Stobart v. State, supra.

When issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respects as if they had been raised by the pleading. La. C. C. P. art. 1154. If evidence is objected to at trial on the ground that it is not within the issues made by the pleadings, the court may allow the pleadings to be amended and shall do so freely when the presentation of the merits of the action will be subserved thereby, and the objecting party fails to satisfy the court that admission of such evidence would prejudice him in maintaining his action or defense on the merits. Id.; Brantley v. Kaler, 43,418 (La.App. 2 Cir. 6/4/08), 986 So.2d 188. A party who wishes to introduce evidence not within the issues raised by the pleadings must move to amend the pleadings before the evidence can be offered over an objection. Alaska S. Partners v. Baxley, 35,206 (La.App. 2 Cir. 10/31/01), 799 So.2d 680, and citations therein. When the pleading in question is construed in its entirety and with all other matters occurring during trial that relate to the pleading, and it is more reasonable than not to conclude that the adverse party received fair notice and was fairly informed of the pleading’s intended substantive result, the pleading will be held to be legally effective. Boudreaux v. Boudreaux, 2015-0536 (La. 10/14/15), 180 So.3d 1245; Zimmerman v. Progressive Sec. Ins. Co., 49,982 (La.App. 2 Cir. 8/12/15), 174 So.3d 1230.

Only a person having a real and actual interest to assert may bring an action. La. C. C. P. art. 681; Eagle Pipe & Supply Inc. v. Amerada Hess Corp., 2010-2267 (La. 10/25/11), 79 So.3d 246, 174 Oil & Gas Rep. 32; Wagoner v. Chevron USA Inc., 45,507 (La.App. 2 Cir. 8/18/10), 55 So.3d 12, 178 Oil & Gas Rep. 978, writ denied, 2010-2773 (La. 3/2/12), 83 So.3d 1032. The peremptory exception of no right of action is used to show that a plaintiff has no legal right or interest in enforcing the matter asserted, based on the facts and evidence submitted. La. C. C. P. art. 927. The burden of proof of establishing the exception of no right of action is on the party raising the exception. Wagoner v. Chevron USA, supra. Evidence is admissible on the trial of the exception of no right of action to “support to controvert any of the objections pleaded, when the grounds therefor do not appear from the petition.” La. C. C. P. art. 931; Industrial Cos. Inc. v. Durbin, 2002-0665 (La. 1/28/03), 837 So.2d 1207.

Discussion: Parol Evidence and the 12 ⅞% Retention

By his first assignment of error, Saheid urges the court committed legal error in finding the documents ambiguous and allowing Gish to use parol evidence. He contends the Act of Credit Sale transferred all land and rights to Saheid. He offers an exposition of the public records doctrine and shows that his expert, Huguet, scoured the public records finding no evidence that the plaintiffs had any right in this property or its minerals; as a InPurchaser, Saheid was not bound by any unrecorded mineral interests. He argues that Meraux v. R.R. Barrow Inc., 219 La. 309, 52 So.2d 863 (1951) is apposite: in that case, no plaintiff ever recorded a separate royalty interest, and the court rejected the plaintiffs’ claims; the same result should obtain here. Moreover, both the Act of Credit Sale and the Contract were clear and explicit, lacking any language that reserved any mineral interest. Saheid submits that the “vague language” of these documents did not establish any reservation of minerals, and he made four years of royalty payments in error.

By his second assignment of error, Sa-heid urges the court committed manifest error in finding Gish’s testimony credible to support the finding that he retained a 12 ½% mineral interest in the property sold to Saheid. He argues that Gish’s testimony was unsupported by any documentation and too inconsistent to justify the court’s findings.

On close examination, the transfer documents show ambiguity not normally found in a transaction of this size. The Agreement refers to Gish as seller and Saheid as buyer, and to a “real estate transaction involving 1,096 acres, including all oil and gas leases,” but lacks the standard phraseology of “grant, bargain, sell, convey,” and includes the peculiar clause that Gish would “give best effort to deliver to buyer the remaining 12 ½% Gish family oil and gas lease holding.” The Act of Credit Sale names Gish and his family trust without referring to them as sellers; with slightly better clarity it identifies Sa-heid as the purchaser and recites that Gish (alone) “does * * * grant, bargain, sell, convey, transfer, set over, assign and deliver” the tract of land and mineral rights. However, Paragraph K states that the trust and Saheid agree that the trust owns only 87.5% interest in the mineral leases assigned herein, a point that would seem unnecessary if Gish |]2were the seller, as suggested earlier in the document. Finally, the Contract refers to Gish and his wife as the sellers (no mention of the family trust), to Saheid as the buyer, and to the Act of Credit Sale, but states in Paragraph 2(d) that Saheid consented and acknowledged that he would continue to withhold two 6.25% royalty payments.

While we agree with Saheid’s position that these documents do not make an express reservation of mineral rights, we also find that the recurrent reference to a 12 ⅜% interest — be it “remaining,” “withheld,” or inferred from the recital that the seller owned only 87 ½% — just as strongly suggests that Gish did not intend to sell, and Saheid did not intend to buy, the entire mineral interest. In short, the district court did not commit legal error in finding the documents ambiguous and using parol evidence to interpret them. The first assignment of error lacks merit.

To interpret these ambiguous documents, the district court heard four live witnesses. This court has already summarized their testimony; our duty is to decide whether the district court’s interpretation of their testimony was reasonable. Gish testified that he initially intended to sell the entire tract, including mineral rights, for $4 million, but when Saheid was unable to get financing, he agreed to $400,000 off the purchase price, owner financing, and selling only 87 ⅜% of the minerals. David, the broker, confirmed that Gish was selling 100% of the tract and 87 ½% of the minerals. Reservation of a portion of the minerals is a reasonable concession for accepting a partial payment and owner financing. Moreover, Saheid paid Gish the mineral 11sroyalty for nearly four years, strongly suggesting that the reservation was the parties’ intent.

On the other hand, Saheid testified he was unfamiliar with Louisiana property law and “confused” when he went to New Orleans, he was unaware of the 12 ⅜% retention and never intended to -buy less than the entire mineral interest. However, he admitted paying the royalty for nearly four years, until April 2008, halting payment only when he wanted to lease the minerals. On these facts and circumstances, the district court did not abuse its discretion in discounting Saheid’s claimed intent.

A large portion of Saheid’s testimony, and a major theme of his argument on appeal, is that Gish repeatedly said other family members, or the family trust, owned the disputed 12 ½%, and thus he could not sell it; when the title examination showed no such separate' interest on the public record, Saheid felt he was entitled to 100%. Saheid’s expert, Huguet, confirmed that no separate interest was recorded. However, the district court found that the transfer documents were ambiguous and that extrinsic evidence would be needed to discern the parties’ true intent. The court found, based on the overall structure of the transaction, the recurring reference to a separate 12 ½% interest, and Saheid’s history of paying royalties,, the intent was for Gish to sell, and Saheid to buy, 87 ½% mineral interest, a completely legal result. La. R.S. 31:15. Gish’s evolving explanation for retaining 12 ⅜%, and • Sa-heid’s imperfect understanding | uthereof, are simply irrelevant and definitely do not violate Louisiana public records doctrine.

The district court committed no manifest error in interpreting the parol and other evidence to find that Gish sold, and Saheid bought, 87 ½% of the mineral interest. The second assignment of error lacks merit.

Expansion of the Pleadings

' By his third assignment of error, Saheid urges the court committed legal error in allowing Gish to amend or enlarge the pleadings in the middle of trial. In the petition, Ms. Shepard and the Kennedys (Gish’s mother and sister) alleged they owned the 12 ½%; at trial, Gish said he owned it. Saheid shows that the petition must name the true claimants, La. C. C. P. art. 891, and the petition must be amended to conform to the evidence, La. C. C. P. art. 1154. He . contends that “trial by ambush” is not allowed, Teasley v. Ates, 2003-824 (La.App. 3 Cir. 12/10/03), 861 So.2d 778, writ denied, 2004-0092 (La. 3/19/04), 869 So.2d 855, a timely objection precludes such amendment, Burns v. Interstate Brands Corp., 2009-705 (La.App. 3 Cir. 2/3/10), 30 So.3d 271, and that equitable estoppel prevents a claimant from shifting to “another right, remedy or option” to the detriment of the opponent, Barnco Int’l v. Arkla Inc., 628 So.2d 162 (La. App. 2 Cir. 1993), writ denied, 94-0397 (La. 4/4/94), 635 So.2d 1105. Saheid shows that he objected timely to the ex pansion of the pleadings and the court should not have allowed Gish to prove that somebody other than Ms. Shepard and the Kennedys owned the contested 12 ½%. He concludes that because of this error, the judgment should be reversed and the case dismissed.

The law expressly permits expansion of the pleadings to conform' to the evidence. La. C. C. P. art. 1154. Even when the affected party objects, hfithe court may permit amendment if so doing aids the presentation of the evidence and does not prejudice the other party. Brantley v. Kaler, supra. Construction with other matters at trial, and fair notice, are key to allowing expansion. Boudreaux v. Boudreaux, supra.

On this record, we find no abuse of the district court’s discretion. The issue of the 12 ⅜% mineral interest was alleged in the petition and in every subsequent pleadings and hearing. There was never any attempt to claim a different right, remedy or option, as criticized in Barnco Int'l v. Arkla Inc., supra. It is disingenuous for Saheid to contend that he was surprised or “ambushed” by Gish’s position at trial. In addition, there is no showing that Saheid was prejudiced by the expanded pleadings. He offered the testimony of an expert, Hu-guet, who found no separate mineral interest in the public records; this defense would be exactly the same whether the interests were claimed by Gish, his sister, his mother or the family trust. Finally, Huguet admitted that as full owner, Gish could sell whatever portion he desired; to deny expansion of the pleadings would effectively block him from asserting his interest. The third assignment of error lacks merit.

No Right of Action

By his fourth assignment of error, Saheid urges the court committed legal error in denying his exception of no right of action, as Gish had no right to pursue claims that belonged to the Kennedys, parties who were dismissed. The argument mirrors that in the third assignment, adding that evidence is admissible on trial of the exception of no right of action, La. C. C. P. art. 931, and once the Kennedys were dismissed, the evidence showed that only Ms. Shepard had any interest. From this, Saheid submits l1Bthe judgment should be amended to reflect only Ms. Shepard’s 6 ⅜% interest.

Only a person having a real and actual interest to assert may bring an action. La. C. C. P. art. 681; Eagle Pipe & Supply Inc. v. Amerada Hess Corp., supra. The burden of proof at trial of the exception is on the person raising the exception. Wagner v. Chevron USA Inc., supra. Evidence is admissible at trial of the exception. La. C. C. P. art. 931; Industrial Cos. Inc. v. Durbin, supra.

The district court referred the exception to the merits, as allowed by Art. 931. After finding the transfer documents ambiguous, the court heard parol and extrinsic evidence to ascertain the parties’ true intent, ultimately finding that Gish was the full owner of the property and agreed to sell 87 ⅜% of the mineral interest. From this it follows that Gish was the proper person to seek a declaration of the ownership of the contested 12 ⅜%. The court committed neither legal nor factual error in finding Gish had a real and actual interest. The fourth assignment of error lacks merit.

Conclusion

For the reasons expressed, the judgment is affirmed. Mohamed “Jack” Saheid is to pay all costs,

AFFIRMED.

      . In a nutshell: ownership of real property is determined from the public records, La. C.C. art. 3338; a transfer is effective against third parties only from the date of filing in the public records, La. C.C. art. 1839; this princi-pie applies to mineral rights, Ogden v. Ogden, 93-1413 (La.App. 3 Cir. 9/21/94), 643 So.2d 245, writ denied, 94-2539 (La. 1/13/95), 648 So.2d 1339.

      . We note that in opposition to Gish’s motion for summary judgment, Saheid argued that the Contract “is ambiguous about what is given and who is to receive it,” precisely the conclusion he is now contesting on appeal.

      . This court would take judicial notice that March 2008 marked the beginning of the land-leasing boom associated with the Haynesville Shale formation. Ferrara v. Questar Expl. & Prod. Co., 46,357 (La.App. 2 Cir. 6/29/11), 70 So.3d 974, 181 Oil & Gas Rep. 913, writ denied, 2011-1926 (La. 11/14/11), 75 So.3d 943; Yates v. Marston, 48,009 (La.App. 2 Cir. 5/22/13), 121 So.3d 673.


author: BROWN, CHIEF JUDGE.

text:
    ENCANA OIL & GAS (USA) INC. and SWEPI, LP, Plaintiffs v. BRAMMER ENGINEERING, INC., et al., Defendants
    No. 51,045-CA
    Court of Appeal of Louisiana, Second Circuit.
    November 16, 2016
    Rehearing Denied 01/05/2017

      WALL, BULLINGTON & COOK, LLC, By: Guy E. Wall, Maurine W. Laborde, Counsel for Defendants/Appellants
    DAVIDSON SUMMERS, APLC, By: Grant E. Summers, Andrew D. Martin, Counsel for Defendant/Appellant, Harriett A. Jennette
    BRADLEY, MURCHISON, KELLY, & SHEA, LLC, By: Joseph L. Shea, Jr., Leland G. Horton, Counsel for Defendant/ Appellee, Brammer Engineering, Inc.
    DUPUIS & POLOZOLA, By: Kyle P. Polozola, James H. Dupuis, Jr., Counsel for Plaintiffs/Appellees, EnCana Oil & Gas and SWEPI, LP
    Before BROWN, LOLLEY, and STONE, JJ.
   BROWN, CHIEF JUDGE.

[, EnCana Oil & Gas (“EnCana”) and SWEPI, LP (“Swepi”), the mineral operators, filed a concursus proceeding to resolve a dispute between the lessors, Stewart Group and Harriett Jennette, on one hand and Brammer Engineering, Inc. (“Brammer”), an agent, on the other hand concerning an overriding mineral royalty. The mineral owners and Brammer responded with competing motions for summary judgment. The trial court found in favor of Brammer, granting its motion for summary judgment. We reverse and remand.

Facts

In 1962, several individuals (“mineral owners”) holding interest in the old Mansfield Hardwood Lumber Company hired John S. Callón to act as their agent and attorney-in-fact for their mineral interests. In 1988, the mineral owners entered into a new power of attorney agreement with Callón; this agreement essentially had the same terms as the 1962 Callón POA.

In 2001, Callón resigned as the mineral owners’ agent and attorney-in-fact. Thereafter, Brammer agreed to handle the leasing under the same terms and conditions as Callón. The mineral owners entered into a power of attorney agreement with Brammer (hereinafter referred to as the “Brammer POA”) that adopted the terms for compensation from the 1988 Callón POA.

|2In 2008, John Madison, Jr., and James Robinson Madison (the “Madisons”) of Wiener, Weiss & Madison represented several clients who owned mineral interests in the stated land. The Madisons themselves also owned interests in the land. The Madisons contacted Brammer to see if it wanted to participate in a bid package they were proposing. The Madi-sons told Brammer that due to the discovery of the Haynesville Shale, mineral owners could secure more favorable royalties from oil companies if all of the interested parties participated. Brammer, as agent for the mineral owners, agreed, and subsequently hired Wiener, Weiss & Madison to prepare a bid package, which contained a proposed lease with a 1/4 lessor’s royalty and solicited bids from several oil companies.

After receiving responsive bids, including a bid from EnCana, Brammer’s in-house counsel, Robert Kyle, contacted John Madison and told him that the proposed lease did not provide for the overriding royalty which Brammer claimed to be entitled to under the Brammer POA. At John Madison’s request, Kyle sent him the language Brammer wanted to include in the lease, which was as follows:

As per the recorded powers of attorney and agency agreements in favor of Brammer Engineering, Inc., there is hereby reserved in favor of Brammer Engineering, Inc., from the Lessor’s royalty provided for herein, a free overriding royalty of 1/32 of 8/Sths, which free overriding royalty shall be calculated and delivered in the same manner as the Lessor’s royalty.

Thereafter, Madison advised his secretary to add that language to the lease. Subsequently, Brammer, on June 18, 2008, as agent and attorney-in-fact for the mineral owners, executed a lease with EnCana.

|ROn February 2, 2009, one of the mineral owners, Harriett A. Jennette, executed a document wherein she individually renounced Brammer’s power of attorney. This same document was recorded and filed on February 4, 2009. However, Bram-mer had executed an assignment to itself effective June 18, 2008.

On July 31, 2013, EnCana & Swepi filed their petition for concursus. The trial court ordered that EnCana <& Swepi deposit the disputed amount into the registry of the court.

In their answer, the mineral owners, the Stewart Group and Jennette, argued that they were entitled to the disputed amount and filed a motion for partial summary judgment. The Stewart Group argued that the EnCana Lease, pursuant to the Bram-mer POA, provided that, if Brammer obtained an overriding royalty for the mineral owners, Brammer would share in that overriding royalty. The mineral owners asserted that an overriding royalty is carved out of the working interest, i.e., the lessee’s interest in a lease, never out of a lessor’s royalty. Therefore, since Brammer failed to procure an overriding royalty in favor of the mineral owners in connection with the EnCana Lease, it did not have a right to an interest in oil and gas production attributable to that lease. The mineral owners sought a summary judgment recognizing that they own a 1/4 lessor’s royalty under the EnCana Lease and awarding them all of the revenue which has been deposited into the registry of the court.

14Jennette also filed a motion for partial summary judgment. In addition to joining in the other mineral owners’ motion for summary judgment, Jennette further argued that Brammer purported to execute on her behalf an assignment of an overriding royalty interest to Brammer, stating that the assignment was “effective 18th day of June 2008.”

Brammer also filed a motion for summary judgment. Brammer submitted that the dispute was over the following language contained within the Brammer POA:

It is recognized that mineral leases executed in the future by Agent on behalf of principal will provide for the reservation of an additional free overriding.royalty interest on behalf of the lessors.

Brammer argued that the additional free overriding royalty interest reserved for Brammer was a contractual obligation payable to Brammer from “the total royalty interest reserved in the Mineral Leases.” They claimed that Brammer fulfilled its duties to the mineral owners in a manner more beneficial than required and earned an overriding royalty interest.

The trial court issued its written ruling, finding in favor of Brammer. A judgment followed granting Brammer’s motion for summary judgment, recognizing Bram-mer’s 1/32 overriding royalty interest attributable to the interests of the Stewart Group and Jennette and ordering that the funds in the registry of the Court attributable to that interest to be paid to Bram-mer.

The mineral owners have appealed from this judgment.

| 5Discussion

The compensation provisions of the Brammer POA read as follows:

It is recognized that mineral leases executed in the future by Agent on behalf of Principal will provide for the reservation of an additional free overriding royalty interest on behalf of the lessors. (Emphasis added). It is agreed that in consideration of the services rendered and to be rendered by Agent, shall be entitled to compensation as follows, to wit:
1.On oil, gas and mineral leases under the terms of which not less than 1/16 free overriding royalty is reserved, Agent shall be entitled to a 1/32 free overriding royalty (Emphasis added);
2. On oil, gas and mineral leases under the terms of which less than a l/16th free overriding royalty interest is reserved, Agent shall be entitled to a 50% of the free overriding royalty which is reserved; '
3. On oil, gas and mineral leases, Agent shall be entitled to receive 10% of the cash bonus'received including annual delay rentals.

In the EnCana Lease, the Stewart Group and Jennette were granted a royalty of 1/4 or 25%. Brammer received 10% of the cash bonus which was $636,582,89.

The Brammer POA provides that Bram-mer is compensated in two ways: a 10% cash bonus and an overriding royalty interest, Here, the parties do not dispute that Brammer’s execution of the EnCana Lease entitled it to receive a substantial cash bonus of $636,582.89. Our inquiry focuses on the other form of compensation, the overriding royalty interest.

The interpretation of a contract typically presents a question of law that may be resolved by summary judgment. Hoover Tree Farm, L.L.C. v. Goodrich Petroleum Co., 46,153 (La.App. 2 Cir. 3/23/11), 63 So.3d 159, writs denied, 11-1225, 11-1236 (La. 9/23/11), 69 So.3d 1162.

Contracts have the effect of law for the parties and the interpretation of a contract is the determination of the common intent of the parties. La. C.C. arts. 1983, 2045; Marin v. Exxon Mobil Corp., 09-2368 (La. 10/19/10), 48 So.3d 234. The reasonable intention of the parties to a contract is to be sought by examining the words of the contract itself, and not assumed. Prejean v. Guillory, 10-0740 (La. 07/02/10), 38 So. 3d 274. When the words of a contract are clear and explicit and lead to no absurd consequences, no further interpretation may be made in search of the parties’ intent. La. C.C. art. 2046; Prejean, supra at 279. Accordingly, when a clause in a contract is clear and unambiguous, the letter of that clause should not be disregarded under the pretext of pursuing its spirit, as it is not the duty of the courts to bend the meaning of the words of a contract into harmony with a supposed reasonable intention of the parties. Id. However, even when the language of the contract is clear, courts should refrain from construing the contract in such a manner as to lead to absurd consequences. La. C.C. art. 2046; Amend v. McCabe, 95-0316 (La. 12/1/95), 664 So.2d 1183. Most importantly, a contract must be interpreted in a common-sense fashion, according to the words of the contract their common and usual significance. Prejean, supra.

In this case, the Brammer POA is a contract of mandate that authorized Bram-mer to enter into mineral leases on behalf of the lessors, the mineral owners. Pursuant to this POA, Brammer executed the EnCana Lease.

Brammer argues that the Brammer POA provides that if Brammer obtains anything higher than what Brammer asserts, the standard lessor’s royalty of 1/8, then it is an overriding royalty. The mineral owners counter that the Brammer POA provides that Brammer must expressly reserve an 17additional free overriding royalty on their behalf to trigger Brammer’s compensation to an overriding royalty.

Brammer states that the threshold question is what constitutes a 1/16 free overriding royalty reserved to the lessor. Brammer interprets that provision to mean that the agent is entitled to a full 1/32 overriding royalty interest as compensation any time that the agent acquires in favor of the mineral owners at least 1/16 or 6.25% more than the “typical” 1/8 royalty. A 1/8 royalty equals 12.5%. Thus, Bram-mer claims that if it obtained at least 18.75% total royalty for the mineral owners then it will earn a full 1/32 overriding royalty interest.

Unlike the terms “lessor’s royalty” and “mineral royalty,” the Mineral Code does not expressly defines “overriding royalty,” but acknowledges that such an interest exists. See La. R.S. 31:126, 31:171, 31:191. Moreover, the term “overriding royalty” is used to describe a royalty carved out of the working interest created by an oil and gas lease. An overriding royalty is an interest severed out of the working interest or lessee’s share of the oil, free of the expenses of development, operation and production. Its duration is limited to the life of the lease from which it was created. Pinnacle Operating Co. Inc. v. Ettco Enterprises, Inc., 40,367 (La. App. 2d Cir. 10/26/05), 914 So.2d 1144. The lessor’s royalty is distinguished from the overriding royalty. Frey v. Amoco Prod. Co., 603 So. 2d 166 (La. 1992); see also Williams & Meyers, Manual of Oil & Gas Terms (14th ed. 2009) (defining an “overriding royalty” as “[a]n interest in oil and gas produced at the surface, free of the expense of production, and in addition to the usual landowner’s royalty reserved to the lessor in an oil and gas lease”). (Emphasis added). |sThus, it is clear that an overriding royalty is in addition to a lessor’s royalty. This difference is acknowledged in Brammer’s assignment of an overriding royalty from the EnCana Lease:

there is hereby reserved in favor of Brammer Engineering, Inc., from the Lessor’s royalty provided for herein, a free oveiriding royalty of 1/32 of 8/8ths, which free overriding royalty shall be calculated and delivered in the same manner as the Lessor’s royalty. (Emphasis added).

The Brammer POA provides that “mineral leases executed in the future by [Brammer]... will provide for the reservation of an additional free overriding royalty interest.” (Emphasis added). The use and plain meaning of the word “additional” provides that the following clause, “overriding royalty interest,” is in addition to another form of action, which is the reservation of a lessor’s 1/4 royalty. Moreover, by using the full clause, “additional free overriding royalty interest,” the parties to the Brammer POA made a distinction between a royalty and an “additional free overriding royalty.” The Brammer POA even provides an exact percentage Brammer must reserve to trigger its compensation to an overriding royalty, i.e., not less than a 1/16 of the lessor’s 1/4 royalty must be reserved. We find that the Bram-mer POA is unambiguous in that Brammer had to expressly reserve an additional royalty interest on behalf of the mineral owners to trigger its compensation to an overriding royalty interest.

Brammer’s argument redefines the term “royalty” to mean “standard lessor’s royalty,” whatever that “standard” may be. This would require us to look beyond the words of the contract. For instance, the Brammer POA was signed in 2001, but the EnCana Lease was not executed until 2008. Thus, |9the “standard lessor’s royalty” may have changed during these intervening years, which is exactly what the mineral owners assert.

Further, in 2001, a 1/8 royalty might have been the standard but by 2008 in the Haynesville Shale a 1/4 royalty was offered at the outset. In this case, the bid package prepared by Wiener, Weiss & Madison contained a 1/4 royalty requirement. Brammer did nothing to obtain this royalty-

Accordingly, we conclude that the trial court erred in granting Brammer’s motion for summary judgment.

Conclusion

The judgment of the trial court is REVERSED and the matter is REMANDED. Costs of this appeal are assessed against Brammer.

REVERSED AND REMANDED.

Before BROWN, WILLIAMS, DREW, LOLLEY, and STONE, JJ.

Rehearing denied.

      . Brammer is an exploration and production company that specializes in outsourcing exploration and production personnel resources to exploration and production companies.

      . In deposition, Madison testified that he did not review the provision before advising his secretary to add it to the lease.

      . In support of their motion, the mineral owners submitted the following documents: the 1988 Callón POA, a letter from Brammer to the mineral owners showing Brammer’s representation of the mineral owners under the same terms as the 1988 Callón POA, the Brammer POA, the affidavit of John Madison, Jr., and the EnCana Lease.

      .In support, Jennette submitted the partial deposition of the land manager of Brammer, Randall J. Beau, her renunciation of Bram-mer, and Brammer’s assignment of an overriding royalty from the EnCana Lease.

      . In support, Brammer submitted numerous documents, including the affidavit of Bram-mer’s general counsel at the time of execution of the EnCana Lease, Robert M. Kyle, the 1962 Callón POA, and leases executed by Cal-lón and Brammer on behalf of the mineral owners.

      . Because we have reached this conclusion, we pretermit a discussion of the other assignments of error.