Monsanto Co. v. KT Farms P'ship
245 So. 3d 191
La. Ct. App.2017Background
- KT Farms (partnership of Aymond and Herron) purchased seed/products through dealers (Tensas, later Helena); Monsanto claimed $671,041.60 remained unpaid for 2013 purchases.
- KT Farms executed an interest-free seed financing application/agreement in 2011 (copy produced at trial was partially illegible).
- TKI (Thad Kyle Investments, LLC) executed a guaranty in 2011, signed by Aymond.
- Monsanto sued (2014) after certified demand letters were returned; trial was held in 2016.
- Trial evidence included Monsanto/Helena invoices, delivery tickets, credit memos, statement of account, the illegible 2011 agreement, and a partial 2013 document showing dealer change to Helena.
- Trial court awarded Monsanto $671,041.60 plus 18% interest from 12/31/2013, $50,000 attorney fees, costs, and held defendants liable in solido; appellate court affirmed the principal but amended interest, attorney fees, and solidarity findings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Right to recover on the debt (open account) | Monsanto: purchases were made, records (invoices, delivery tickets, memos, statement) prove $671,041.60 due under financing program | Defendants: 2011 agreement is illegible; delivery tickets not signed by KT Farms; cannot verify deliveries or terms | Held: Monsanto proved an open-account claim by preponderance; recovery of principal $671,041.60 affirmed (based on open account evidence, not the illegible contract) |
| Interest rate | Monsanto: entitled to 18% per year (relied on terms in later 2013 form) | Defendants: no legible contractual provision establishing 18% rate | Held: 18% contractual rate not proven; award amended to legal interest from date of judicial demand |
| Attorney fees | Monsanto: contract/statute entitles it to collection fees (sought 25–26%) | Defendants: agreements do not show attorney-fee clause; claimed award excessive | Held: Contractual attorney-fee clause not proven; fees recoverable only under La. R.S. 9:2781 (open account); trial court award of $50,000 reduced to $15,000 as reasonable |
| Degree of liability (solidary vs. virile) | Monsanto: held all defendants solidarily liable (trial court) | Defendants: partners are liable only for partnership (virile) shares; only guarantor liable in solido | Held: Partners (Aymond, Herron, KT-One) liable for virile share only; TKI (guarantor) liable in solido with KT Farms |
Key Cases Cited
- Retail Merchants Ass'n, Inc. v. Forrester, 114 So.3d 1175 (La. App. 2 Cir. 2013) (appellate rendering of just judgment; pleading standards)
- Frey Plumbing Co., Inc. v. Foster, 996 So.2d 969 (La. 2008) (definition/scope of open account)
- Ballard's Inc. v. North Am. Land Dev. Corp., 677 So.2d 648 (La. App. 2 Cir. 1996) (open account analogous to credit account)
- Cole Oil & Tire Co., Inc. v. Davis, 567 So.2d 122 (La. App. 2 Cir. 1990) (proof requirements for open account)
- Helena Chem. Co. v. Nichols, 695 So.2d 990 (La. App. 3 Cir. 1996) (business records can suffice to prove delivery where kept in regular course)
- Rosell v. ESCO, 549 So.2d 840 (La. 1989) (standard for appellate review of credibility findings)
- Saucier v. Hayes Dairy Products, Inc., 373 So.2d 102 (La. 1979) (factors guiding reasonableness of attorney fees)