LOGA Industry Report - Winter 2009 - (Page 39) LEGAL UPDATES by Mark B. Oliver and Jasmine B. Bertrand Onebane Law Firm Just Title and Good Faith Both Required for 10-Year Acquisitive Prescription The case of Mayers v. Marmet, 985 So.2d 315 (La.App. 3 Cir. 05/28/08) serves as a reminder of two particular aspects of Louisian law: in order to be valid, a donation inter vivos must comport with the form requirements of the Louisiana Civil Code; and in order to acquire by prescription of 10 years, a possessor must establish both good faith and just title, which are two separate components. In this case, the plaintiffs acquired a mineral interest in a five-acre tract of land (the “Subject Land”) by virtue of a Mineral Deed executed February 19, 2005, from Rodney J. Grantham, Sr. Prior to the execution of this Mineral Deed, Rodney J. Grantham, Sr. purportedly executed an Inter Vivos Donation dated February 18, 1991, in favor of Rodney J. Grantham, Jr. and Alisa Hansbrough Grantham [the “1991 Donation”]. The 1991 Donation was executed before only one witness, thereby making it an absolute nullity because Louisiana Civil Code Article 1536 requires an act of donation of immovable property to be executed before two witnesses and a notary. The defendant attempted to claim his interest in the property at issue by virtue of a chain of title emanating from the 1991 Donation. The plaintiffs alleged that the nullity of the 1991 Donation resulted in the plaintiffs’ acquisition of all interest in the minerals in the Subject Land. In response, the defendant asserted that he acquired all interest in the minerals by virtue of 10- year acquisitive prescription. The defendant argued that despite the nullity of the 1991 Donation, his ancestor in title believed in good faith that he owned the property and its minerals. He also argued that in 1983 the Louisiana legislature changed the law relative to tacking when it revised Louisiana Civil Code Article 3480 and “separated the concepts of good faith possession and just title for the purpose of acquisitive prescription.” He argued that both good faith and just title are no longer required for 10-year acquisitive prescription, relying upon comments to the article. The Third Circuit, however, found in favor of the plaintiffs. The court stated that under Louisiana Civil Code Article 3475, both good faith and just title are required for purposes of acquiring ownership by prescription of 10 years, as they are two of the four requirements for ten-year acquisitive prescription. The Civil Code defines “just title” as “a juridical act, such as a sale, exchange, or donation, sufficient to transfer ownership or another right. The act must be written, valid in form, and filed for registry in the conveyance records of the parish in which the immovable is situated.” The 1991 Donation was not valid in form, and therefore, the Court stated, defendant did not have just title. In response to the defendant’s argument that he did not need both just title and good faith to permit tacking, the court found that although good faith and just title are distinct requirements, both must exist for acquisition of ownership through prescription of 10 years. Fifth Circuit Applies Louisiana Mineral Code to Mineral Royalty Held by U.S Waterfowl L.L.C. v. United States, 2008 U.S. App. LEXIS 20201 (5th Cir. 2008) is the latest in a series of appeals in this litigation, which involves a settlement agreement entered into in 1988 between the plaintiff-mineral servitude owners and the federal government in which the United States recognized certain servitudes owned by the plaintiffs were in existence. In exchange for this recognition, the plaintiffs carved mineral royalty, bonus and rental rights out of the servitudes and conveyed them to the United States. In 2003, the plaintiffs again sued the United States for a declaratory judgment claiming that the federal government’s mineral royalty had prescribed in accordance with Louisiana law as a result of prescription of 10 years of nonuse under the Louisiana Mineral Code. The federal government responded that federal common law, and not the Louisiana Mineral Code, applied to the settlement agreement. The 2003 suit made its way to the Fifth Circuit, which held that state law would presumptively apply unless the federal government had intended to “opt out” of the state regime. In order to avoid application of state law, the Fifth Circuit stated that the United States would need to show that it contracted around the Louisiana Mineral Code in the settlement agreement, and then remanded the case to the district court for a determination of which law the parties intended to govern the royalty. Upon remand, the district court found that the federal government did not www.loga.la | 39 http://www.loga.la
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