Eagle Pipe and Supply, Inc. v. Amerada Hess Corporation
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EAGLE PIPE AND SUPPLY, INC.
v.
AMERADA HESS CORPORATION, et al.
Supreme Court of Louisiana.
*251 Gaudry, Ranson, Higgins & Gremillion, LLC, Michael Don Peytavin, Thomas Livingston Gaudry, Jr., Gretna, LA, for Applicant (No. 2010-C-2267).
Adams & Reese, LLP, Martin A. Stern, Thomas Arnoult Rayer, Jr., New Orleans, LA, Babineaux, Poche, Anthony & Slavich, LLC, Olivia S. Regard, Lafayette, LA, Curry & Friend, Christoffer Carter Friend, Gordon, Arata, McCollam, Duplantis & Eagan, LLC, Terrence Kent Knister, Kean, Miller, Hawthorne, D'Armond, McCowan & Jarman, Michael R. Phillips, Lapeyre & Lapeyre, Etienne Cassard Lapeyre, LeBlanc Bland PLLC, Elizabeth S. Wheeler, New Orleans, LA, Rodney & Etter, LLC, Roy J. Rodney, Jr., Lafayette, LA, Roedel, Parsons, Koch, Blache, Balhoff & McCollister, Thomas E. Balhoff, Baton Rouge, LA, Stockwell, Sievert, Viccellio, Clements & Shaddock, David Laine Morgan, Lake Charles, LA, The Murray Law Firm, Korey Arthur Nelson, Arthur M. Murray, Stephen Barnett Murray, New Orleans, LA, The Sonnier Firm, Charles R. Sonnier, Abbeville, LA, for Respondent (No. 2010-C-2267).
Johnson Gray McNamara, LLC, Mary Susan Johnson, Chadwick James Mollere, Rodney & Etter, LLC, Roy J. Rodney, Jr., Lafayette, LA, for Applicant (No. 2010-C-2272).
Adams & Reese, LLP, Martin A. Stern, Thomas Arnoult Rayer, Jr., New Orleans, LA, Babineaux, Poche, Anthony & Slavich, LLC, Olivia S. Regard, Lafayette, LA, Curry & Friend, Christoffer Carter Friend, New Orleans, LA, Gaudry, Ranson, Higgins & Gremillion, LLC, Michael Don Peytavin, Gretna, LA, Gordon, Arata, McCollam, Duplantis & Eagan, LLC, Terrence Kent Knister, Jones, Walker, Waechter, Poitevent, Carrere & Denegre, Judith V. Windhorst, Kean, Miller, Hawthorne, D'Armond, McCowan & Jarman, Michael R. Phillips, Lapeyre & Lapeyre, Etienne Cassard Lapeyre, LeBlanc Bland PLLC, Joseph E. LeBlanc, Jr., Elizabeth S. Wheeler, New Orleans, LA, Roedel, Parsons, Koch, Blache, Balhoff & McCollister, Thomas E. Balhoff, Baton Rouge, LA, Smith Stag, LLC, Lloyd Stafford Jolibois, Jr., New Orleans, LA, Stockwell, Sievert, Viccellio, Clements & Shaddock, David Laine Morgan, Lake Charles, LA, The Martin Law Firm, APLC, Dale Patrick Martin, Broussard, LA, The Murray Law Firm, Korey Arthur Nelson, Arthur M. Murray, Stephen Barnett Murray, New Orleans, LA, The Sonnier Firm, Charles R. Sonnier, Abbeville, LA, for Respondent (No. 2010-C-2272).
Babineaux, Poche, Anthony & Slavich, LLC, Olivia S. Regard, Lafayette, LA, Jones, Walker, Waechter, Poitevent, Carrere & Denegre, Judith V. Windhorst, New Orleans, LA, for Applicant (No. 2010-C-2275).
Adams & Reese, LLP, Martin A. Stern, Thomas Arnoult Rayer, Jr., Curry & Friend, Christoffer Carter Friend, New Orleans, LA, Gaudry, Ranson, Higgins & Gremillion, LLC, Michael Don Peytavin, Gretna, LA, Gordon, Arata, McCollam, Duplantis & Eagan, LLC, Terrence Kent Knister, New Orleans, LA, Johnson Gray McNamara, LLC, Mary Susan Johnson, Lafayette, LA, Kean, Miller, Hawthorne, D'Armond, McCowan & Jarman, Michael R. Phillips, Lapeyre & Lapeyre, Etienne Cassard Lapeyre, LeBlanc Bland PLLC, Elizabeth S. Wheeler, New Orleans, LA, Rodney & Etter, LLC, Roy J. Rodney, Jr., Lafayette, LA, Roedel, Parsons, Koch, Blache, Balhoff & McCollister, Thomas E. *252 Balhoff, Baton Rouge, LA, Stockwell, Sievert, Viccellio, Clements & Shaddock, David Laine Morgan, Lake Charles, LA, The Martin Law Firm, APLC, Dale Patrick Martin, Broussard, LA, The Murray Law Firm, Korey Arthur Nelson, Arthur M. Murray, Stephen Barnett Murray, New Orleans, LA, The Sonnier Firm, Charles R. Sonnier, Abbeville, LA, for Respondent (No. 2010-C-2275).
Thomas Arnoult Rayer, Jr., New Orleans, LA, for Applicant (No. 2010-C-2279).
Adams & Reese, LLP, Martin A. Stern, New Orleans, LA, Babineaux, Poche, Anthony & Slavich, LLC, Olivia S. Regard, Lafayette, LA, Curry & Friend, Christoffer Carter Friend, New Orleans, LA, Gaudry, Ranson, Higgins & Gremillion, LLC, Michael Don Peytavin, Gretna, LA, Gordon, Arata, McCollam, Duplantis & Eagan, LLC, Terrence Kent Knister, New Orleans, LA, Johnson Gray McNamara, LLC, Mary Susan Johnson, Lafayette, LA, Jones, Walker, Waechter, Poitevent, Carrere & Denegre, Judith V. Windhorst, Kean, Miller, Hawthorne, D'Armond, McCowan & Jarman, Michael R. Phillips, Lapeyre & Lapeyre, Etienne Cassard Lapeyre, LeBlanc Bland PLLC, Elizabeth S. Wheeler, New Orleans, LA, Rodney & Etter, LLC, Roy J. Rodney, Jr., Lafayette, LA, Roedel, Parsons, Koch, Blache, Balhoff & McCollister, Thomas E. Balhoff, Baton Rouge, LA, Stockwell, Sievert, Viccellio, Clements & Shaddock, David Laine Morgan, Lake Charles, LA, The Martin Law Firm, APLC, Dale Patrick Martin, Broussard, LA, The Murray Law Firm, Korey Arthur Nelson, Arthur M. Murray, Stephen Barnett Murray, New Orleans, LA, The Sonnier Firm, Charles R. Sonnier, Abbeville, LA, for Respondent (No. 2010-C-2279).
CLARK, Justice.[1]
The issue presented in these consolidated matters arises from the sale of land to the plaintiff, who later discovered that the land was allegedly contaminated with radioactive material. The plaintiff filed suit against the former landowners and the oil and trucking companies allegedly responsible for the contamination. In the district court, exceptions of no right of action raised by the oil and trucking companies were granted. The court of appeal initially affirmed this decision, but reversed on rehearing.
We granted writs to determine whether a subsequent purchaser of property has the right to sue a third party for non-apparent property damages inflicted before the sale in the absence of the assignment of or subrogation to that right. After review, we find the fundamental principles of Louisiana property law compel the conclusion that such a right of action is not permitted under the law. Instead, the subsequent purchaser has the right to seek rescission of the sale, reduction of the purchase price, or other legal remedies. For the following reasons, we hold the appellate court on rehearing erred by reversing the district court's granting of the peremptory exceptions of no right of action on behalf of the oil and trucking companies. Accordingly, we reverse the court of appeal's decision on rehearing and reinstate the ruling of the district court.
FACTUAL AND PROCEDURAL BACKGROUND
This matter is before the court on an exception of no right of action. Although *253 evidence is admissible on the trial of such an objection "to support or controvert any of the objections pleaded," La. C.C.P. art. 931, the only evidence admitted at the hearing in this case was the bill of sale for the property at issue. This bill of sale was also attached to the petition. Consequently, our recitation of the facts is necessarily obtained from the allegations in the petition. "For purposes of the exception all well pleaded facts in the petition must be taken as true." Harwood Oil & Min. Co. v. Black, 240 La. 641, 649, 124 So.2d 764, 766-767 (1960), superceded by statute on other grounds, recognized in Salvex, Inc. v. Lewis, 546 So.2d 1309 (La. App. 3 Cir.1989).
On July 15, 2008, Eagle Pipe and Supply, Inc. ("Eagle Pipe" or plaintiff) filed a petition for damages in the Civil District Court for the Parish of Orleans, alleging causes of action for breach of contract, negligence, strict liability, redhibition, fraud and conspiracy in connection with property Eagle Pipe acquired two decades earlier.[2] Named in the petition were four groups of defendants: (1) ten oil companies, collectively referred to as the "Oil Company Defendants;"[3] (2) eight trucking companies, collectively referred to as the "Trucking Company/Transporter Defendants;"[4] (3) Robert Bridges, Patsy Tremble Bridges and Edmund J. Baudoin, Jr., collectively referred to as the "Former Property-Owner Defendants;"[5] and (4) ABC Insurance Company, Inc.[6]
According to the petition, more than twenty years ago, on April 22, 1988, Eagle Pipe purchased property in Lafayette Parish from the Former Property Owner Defendants.[7] For several years before the sale, from 1981 to 1988, the Former Property Owner Defendants allegedly leased the property at issue to Union Pipe and Supply, Inc. ("Union Pipe"), which operated a pipe yard or pipe cleaning facility on the property. In conducting its business, Union Pipe allegedly bought, cleaned, stored and sold used oilfield tubing from the Oil Company Defendants. The Trucking Company/Transporter Defendants allegedly transported the tubing from the Oil Company Defendants to Union Pipe's facilities.
Eagle Pipe asserted that radioactive scale known by the acronym TENORM was removed from the tubing or pipes *254 during Union Pipe's cleaning process and was deposited onto the surface of the pipe yard, contaminating the soil where Eagle Pipe now conducts its business.[8] Eagle Pipe claimed it became aware of the alleged contamination of its property after the Louisiana Department of Environmental Quality ("La. DEQ") conducted a field interview and found Eagle Pipe to be in violation of a number of TENORM exposure regulations. The La. DEQ allegedly found TENORM exposure levels on the property which exceeded the regulatory criteria for unrestricted use of property and posed a health hazard to both Eagle Pipe and the public. Eagle Pipe asserted subsequent testing by La. DEQ prompted the agency to issue an order for the remediation of the property. Sometime thereafter, Eagle Pipe filed its suit.[9]
The petition alleged Eagle Pipe has never cleaned pipe on its premises. Therefore, the plaintiff asserted all of the TENORM allegedly present on the property is the result of Union Pipe's activities in cleaning hazardous and radioactive contaminated pipe from the Oil Company Defendants, which was transported to Union Pipe's facilities by the Trucking Company/Transporter Defendants. Eagle Pipe alleged its property has lost all value and is no longer marketable as a result of the long-standing radioactive contamination.
Eagle Pipe alleged a specific cause of action against the Former Property Owner Defendants for redhibition; the other causes of actions are generally asserted against all of the defendants.[10] Eagle Pipe asserted that its petition made no claims under federal law; the Louisiana Conservation Act (La. R.S. 30:1 et seq.); or the Louisiana Environmental Quality Act (La. R.S. 30:2001 et seq.).[11]
The defendants filed declinatory, dilatory and/or peremptory exceptions. All of the defendants filed, or joined in, the peremptory exception of no right of action, arguing Eagle Pipe had no right to assert a claim for damage to the property which occurred before Eagle Pipe was its owner. After a hearing on the exceptions, the trial court ruled, inter alia, that the defendants' exceptions of no right of action be sustained, dismissing Eagle Pipe's claims with prejudice.
Eagle Pipe filed a motion for new trial seeking, in part, to amend its petition. The trial court denied the motion for new trial. Thereafter, the plaintiff filed an appeal with the Fourth Circuit Court of Appeal. On original hearing, a three-judge panel affirmed the trial court's ruling on *255 the exception of no right of action by a two-to-one vote. On rehearing before a five-judge panel, the court of appeal majority reversed the judgment of the district court with respect to its ruling on the exception of no right of action.[12]
All of the Oil Company Defendants participating in the courts below and all but two of the Trucking Company/Transporter Defendants filed writs in this court.[13] These applications were consolidated and granted to review the correctness of the court of appeal's decision on rehearing.[14] Leave was granted by the court for the filing of several briefs by amicus curiae.[15]
LAW AND DISCUSSION
Standard of Review
At issue in this matter is the correctness of the trial court's ruling to grant the exceptions of no right of action filed by the Oil Company Defendants and the Trucking Company/Transporter Defendants. We begin our review by acknowledging that an action can be brought only by a person having a real and actual interest which he asserts. La. C.C.P. art. 681. By filing a peremptory exception of no right of action, a defendant challenges whether a plaintiff has such a real and actual interest in the action.[16] La. C.C.P. art. 927(A)(6). At the hearing on the exception of no right of action, the exception may be submitted on the pleadings, or evidence may be introduced either in support of or to controvert the objection raised when the grounds thereof do not appear from the petition. La. C.C.P. art. 931.
"The function of the exception of no right of action is to determine whether the plaintiff belongs to the class of persons to whom the law grants the cause of action asserted in the suit." Hood v. Cotter, 2008-0215, p. 17 (La.12/2/08), 5 So.3d 819, *256 829. An appellate court reviewing a lower court's ruling on an exception of no right of action should focus on whether the particular plaintiff has a right to bring the suit and is a member of the class of persons that has a legal interest in the subject matter of the litigation, assuming the petition states a valid cause of action for some person. Id.; Badeaux v. Southwest Computer Bureau, Inc., 2005-0612, p. 6-7 (La.3/17/06), 929 So.2d 1211, 1217; Turner v. Busby, 2003-3444, p. 4 (La.9/9/04), 883 So.2d 412, 415-416; Reese v. State, Dept. of Public Safety and Corrections, 2003-1615, p. 3 (La.2/20/04), 866 So.2d 244, 246.
The determination whether a plaintiff has a right to bring an action raises a question of law. A question of law requires de novo review. Holly & Smith Architects, Inc. v. St. Helena Congregate Facility, Inc., 2006-0582, p. 9 (La.11/29/06), 943 So.2d 1037, 1045. Applying this standard of review to the instant matter, we will examine the law de novo to determine whether a purchaser of property may sue a third person for damage which was not apparent at the time of the sale and which was inflicted on the property before the purchase.
Jurisprudence Constante
The Louisiana Civil Code provides there are only two sources of law: legislation and custom. La. C.C. art. 1; see Doerr v. Mobil Oil Corp., 2000-0947, p. 13 (La.12/19/00), 774 So.2d 119, 128. However, legislation is the superior source of law in Louisiana; custom may not abrogate legislation. La. C.C. art. 3, Revision Comments-1987, (d). "Judicial decisions, on the other hand, are not intended to be an authoritative source of law in Louisiana.... our civilian tradition does not recognize the doctrine of stare decisis in our state." Doerr, 2000-0947, p. 13, 774 So.2d at 128.[17]
Under our civilian tradition, we recognize instead that "a long line of cases following the same reasoning within this state forms jurisprudence constante." Doerr, 2000-0947, p. 13, 774 So.2d at 128. This concept has been explained, as follows: "[w]hile a single decision is not binding on our courts, when a series of decisions form a `constant stream of uniform and homogenous rulings having the same reasoning,' jurisprudence constante applies and operates with `considerable persuasive authority.'" Doerr, 2000-0947, p. 13-14, 774 So.2d at 128.[18] Thus, "prior holdings by this court are persuasive, not authoritative, expressions of the law." Doerr, 2000-0947, p. 14, 774 So.2d at 129.[19]
With these principles in mind, we will examine the general Louisiana rule that a purchaser of property cannot recover from a third party for property damage inflicted prior to the sale, sometimes referred to as the subsequent purchaser rule. In order to make this examination, we will review the property law precepts that support this rule, and the reasoning and development of the rule over more than a hundred years of jurisprudence.
Subsequent Purchaser Rule
The subsequent purchaser rule is a jurisprudential rule which holds that an owner of property has no right or actual interest in recovering from a third party for damage which was inflicted on the property before his purchase, in the absence *257 of an assignment or subrogation of the rights belonging to the owner of the property when the damage was inflicted.
The Oil Company Defendants and the Trucking Company/Transporter Defendants rely upon this rule as the basis of their peremptory exceptions of no right of action. According to the defendants, any alleged damage to the property at issue occurred well before Eagle Pipe became owner. The defendants further assert Eagle Pipe cannot show it was the recipient of an assignment or a subrogation of any rights the Former Property Owner Defendants may have against them as alleged tortfeasors.
Eagle Pipe contends the subsequent purchaser rule does not apply here. According to the plaintiff, the rule applies only where the prior damage to property was overt or apparent at the time of the sale. Here, the plaintiff argues the radioactive contamination of the property at issue was not apparent at the time of its purchase. Moreover, Eagle Pipe has asserted its entitlement to damages as the owner of property which is currently being damaged. Finally, the plaintiff asserts that it was subrogated to all of the property rights of the Former Property Owner Defendants through the sale. Alternatively, Eagle Pipe argues that it is a third party beneficiary to contracts entered into between Union Pipe and the Oil Company Defendants.
In order to resolve this matter, it is necessary to examine some fundamental principles of Louisiana property law and how those principles differ from the law of obligations.
Principles of Louisiana Property Law
Property law in Louisiana is a distinct branch of the civil law,[20] dealing with the principal real rights that a person may have in things."[21] Book II of the Louisiana Civil Code, which sets forth the law of property, is entitled "Things and the Different Modifications of Ownership." Thus, an "[a]ccurate definition of the word `things' is indispensable in view of the fact that only things in the legal sense may be objects of property rights."[22]
The Louisiana Civil Code classifies "things" into different categories to which different rules may apply.[23] The 1978 Revision of the Civil Code uses the word "thing" in both a broad and a narrow sense, depending on whether the thing is or is not susceptible of appropriation or pecuniary evaluation.[24] The first division of things in the Civil Code is into common, public and private things. La. C.C. art. 448. The first two classifications—common and public—encompass the broad sense of a "thing."[25] However, in most of the codal provisions, the word "thing" is used "in a narrow sense to designate objects susceptible of appropriation and of pecuniary evaluation," i.e. private things.[26]*258 Private things are owned by individuals, other private persons, and by the state or its political subdivisions in their capacity as private persons. La. C.C. art. 453.
The Civil Code provides that a person may have various rights in things. La. C.C. art. 476 describes the various rights in things as: (1) ownership; (2) personal and predial servitudes; and (3) such other real rights as the law allows. Real rights are not defined by the Civil Code, but ownership is. Ownership is defined as "the right that confers on a person direct, immediate, and exclusive authority over a thing." La. C.C. art. 477(A); see also La. C.C. art. 476, Revision Comments—1978, (b).[27] The three main elements of ownership are set forth as the rights of use, enjoyment and disposal, within the limits and under the conditions established by law. Id.[28]
The owner of a thing may perform a certain number of juridical acts relating to the thing, all consisting of the transfer
to another, in whole or in part, the right of enjoyment and of consumption that belongs to the owner of the thing. If he transmits all his right, it is said that he alienates the thing; he performs an act translative of ownership. If he grants merely a right of partial enjoyment of the thing, it is said that he dismembers his ownership. He creates upon the thing a real right of usufruct, emphyteusis or servitude.[[29]] He is still owner but his ownership has been dismembered. Somebody else has a part, more or less important, of his rights upon the thing.[30]
Furthermore, "[t]he idea must be thoroughly understood that these various juridical acts are carried out, not upon the thing but upon the owner's right." Id. Thus, a real right can be understood as ownership and its dismemberments.[31]
The various dismemberments of ownership also confer real rights on the owner or holder of that right. For example, servitudes are of two types—personal and predial—and they each confer a real right on the holder of the servitude. See La. C.C. arts. 476, 533. A personal servitude is a charge on a thing for the benefit of a person, and is divided in the Civil *259 Code into three sorts—usufruct,[32] habitation,[33] and rights of use.[34] A predial servitude is a charge on a servient estate for the benefit of a dominant estate, where the two estates belong to different owners, and can be of four types—natural, legal, voluntary, and conventional. La. C.C. art. 654.[35] Mineral rights[36] and building restrictions[37] are further examples of real rights.[38] Some distinguishing features of real rights are that they cannot exist without a determined object,[39] may be asserted against anyone, confer the right of preference[40] and the right to follow,[41] and are susceptible of possession and of abandonment.[42]
This Court has defined a real right as "synonymous with proprietary interest, both of which refer to a species of ownership. Ownership defines the relation of man to things and may, therefore, be declared against the world." Harwood Oil & Mining Co., 240 La. at 652, 124 So.2d at 767, citing Reagan v. Murphy, 235 La. 529, 541, 105 So.2d 210, 214 (1958), superceded by statute on other grounds, recognized in Salvex, Inc. v. Lewis, 546 So.2d 1309 (La.App. 3 Cir. 1989). Commentators have discussed the essential quality of ownership, that which distinguishes ownership from other real rights, as "the power of disposing of the thing, by consuming it, by physically destroying it and by transforming its substance."[43] By contrast, "[a]ll other real rights authorize those in whom they are vested to enjoy the thing of another in a more or less complete manner, but always with the obligation of preserving the substance." Id.
*260 The domain of property law in Louisiana is generally distinct from the other main branches of the civil law, including the law of obligations. Because we find the plaintiff urges, and the court of appeal on rehearing held, that certain principles of the law of obligations are applicable to this question of property law, we must also examine some principles of the law of obligations.
Principles of Obligations Law
The law of obligations is found in Book III of the Louisiana Civil Code, and is entitled "Of the Different Modes of Acquiring the Ownership of Things." Whereas property law encompasses the legal relationship which a person has in things, the law of obligations deals with a specific legal relationship between persons. The Civil Code defines an obligation as a "legal relationship whereby a person, called the obligor, is bound to render a performance in favor of another, called the obligee." La. C.C. art. 1756.
Obligations may arise from contracts and other declarations of will. La. C.C. art. 1757. In a contract of sale, for example, the seller is obligated "to deliver the thing sold and to warrant to the buyer ownership and peaceful possession of, and the absence of hidden defects in, that thing. The seller also warrants that the thing sold is fit for its intended use." La. C.C. art. 2475.[44] Specifically, the seller warrants the buyer against redhibitory defects, or vices, in the thing sold, as follows:
A defect is redhibitory when it renders the thing useless, or its use so inconvenient that it must be presumed that a buyer would not have bought the thing had he known of the defect. The existence of such a defect gives a buyer the right to obtain rescission of the sale.
A defect is redhibitory also when, without rendering the thing totally useless, it diminishes its usefulness or its value so that it must be presumed that a buyer would still have bought it but for a lesser price. The existence of such a defect limits the right of a buyer to a reduction of the price.
La. C.C. art. 2520. Thus, when defects are discovered in a thing sold which were not apparent, or hidden, at the time of the sale, the law of obligations provides to the buyer a cause of action in redhibition and the right to sue for rescission of the sale or for a reduction of the purchase price.
However, the seller owes no warranty for defects in the thing that were known to, or should have been discovered by, a reasonably prudent buyer. La. C.C. art. 2521. When the defects of the thing sold are apparent, the law of obligations does not provide a cause or right of action to the buyer. Thus, the Civil Code makes a distinction between apparent (overt) and non-apparent (hidden) defects in a thing sold, and what rights and causes of action are provided for the buyer/new owner, within the law of obligations.
Obligations may also arise directly from the law, regardless of a declaration of will, in instances such as wrongful acts, the management of the affairs of another, unjust enrichment, and other acts or facts. La. C.C. art. 1757. An example of an obligation that arises as a matter of law is found in La. C.C. art. 2315, which establishes the basis of tort liability and provides: "[e]very act whatever of man *261 that causes damage to another obliges him by whose fault it happened to repair it."[45]
In general, obligations are divided in the Civil Code into "strictly personal," "heritable," and "real." An obligation is strictly personal when its performance can be enforced only by the obligee, or only against the obligor. La. C.C. art. 1766. An obligation is heritable when its performance may be enforced by a successor of the obligee or against a successor of the obligor. La. C.C. art. 1765. A real obligation is a duty correlative and incidental to a real right. La. C.C. art. 1763.[46] Thus, a real obligation does not exist in the absence of a real right.
Real obligations are pertinent to our discussion of the present issue because a real obligation and real right both attach to a thing. La. C.C. art. 1764, Revision Comments—1984, (b). La. C.C. art. 1764 explains the effects of a real obligation:
A real obligation is transferred to the universal or particular successor who acquires the movable or immovable thing to which the obligation is attached, without a special provision to that effect.
But a particular successor is not personally bound, unless he assumes the personal obligations of his transferor with respect to the thing, and he may liberate himself of the real obligation by abandoning the thing.
The nature of a real obligation has been thus described:
Real obligations are always duties incidental and correlative of real rights. They are obligations in the sense that they are duties imposed on a particular person who owns or possesses a thing subject to a real right, and they are real in the sense that, as correlative of a real right, these obligations attach to a particular thing and are transferred with it without the need of an express assignment or subrogation. They are also real in the sense that the responsibility of the obligor may be limited to value of the thing.[47]
Both real rights and real obligations may be contrasted with personal rights. The legal right that a person has against another person to demand the performance of an obligation is called a personal right.[48] Distinct from a real right, which *262 can be asserted against the world, a personal right is effective only between the parties. La. C.C. art. 1758.[49] This court has declared that "a personal right ... defines man's relationship to man and refers merely to an obligation one owes to another which may be declared only against the obligor." Harwood Oil & Mining Co., 240 La. at 651, 124 So.2d at 767, citing Reagan, 235 La. at 541, 105 So.2d at 214.
In some instances, a real right and a personal right may appear to be the same, but the underlying nature of the rights distinguishes them. For example,
[a]ccording to appearances, a usufructuary and a lessee seem to have the use and enjoyment of a house in much the same way. But, technically, the usufructuary has a right in the enjoyment of a house; the lessee has a right against the owner of a house to let him enjoy it. One has a real right and the other a personal right.[50]
This court has held "[u]nder the civil law concept, a lease [a contract about property] does not convey any real right or title to the property leased, but only a personal right." Richard v. Hall, 2003-1488, p. 17-18 (La.4/23/04), 874 So.2d 131, 145. "That a lease is not a real right under the civil law is well settled." Reagan, 235 La. 529, 541, 105 So.2d 210, 214. This concept was further explained:
The rights of use, enjoyment, and disposal are said to be the three elements of property in things. They constitute the jura in re: The right of a lessee is not a real right, i.e., a jus in re. In other words, the lessee does not hold one of the elements of property in the thing. His right is a jus ad rem, a right upon the thing.
Reagan, 235 La. at 541, 105 So.2d at 214, citing In Re Morgan R.R. & S.S. Co., 32 La.Ann. 371 (1880).
Real rights, and real obligations pass to a subsequent acquirer of the thing to which it is attached without the need of a stipulation to that effect. La. C.C. art. 1764, Revision Comments—1984, (c).[51] A personal right, by contrast, cannot be asserted by another in the absence of an assignment or subrogation. La. C.C. art. 1764, Revision Comments—1984, (d) and (f).[52]
*263 We now examine the jurisprudential rule at issue in light of the principles of property law and the law of obligations.
Subsequent Purchaser Rule and its Development
a. Clark v. Warner
A hundred and sixty years ago, in Clark v. J.L. Warner Co. et al, 6 La.Ann. 408 (1851), the plaintiff, who had purchased property which included a two-story brick house, kitchen and outhouses, sued the owner of the adjoining property and his lessee, who ran an ice house depot. The plaintiff claimed damage to his house was caused by the pressure, moisture and other destructive effects of the ice on his buildings. The trial court rendered a money judgment in favor of the plaintiff.
This court reversed, finding the district court erred in awarding to the plaintiff all the damages caused to the premises while they belonged to the former property owner, and indeed, to several preceding owners. We held "as to damages actually suffered before the purchase," general tort principles would require that each preceding owner would have a right to recover for the damages which occurred while he or she owned the premises. Clark, 6 La. Ann. at 409. The claim for damages belonging to each preceding owner was described as "an incorporeal right, and strictly personal property." Clark, 6 La.Ann. at 409.
This personal right was not explicitly transferred by the former owner in the bill of sale to the plaintiff, as the bill of sale, examined by the court, was found to be in its usual form for the conveyance of real estate and its appurtenances. Consequently, this court held the plaintiff did not have a right to assert a claim for damage to the property before the date of the act of sale whereby he purchased the property, either by operation of law or contract. Clark, 6 La.Ann. at 409. However, since the plaintiff might have been able to furnish more explicit testimony as to any damages actually suffered by him from the time he became the property owner, the court entered a judgment of non-suit against him.
The plaintiff, and the court of appeal on rehearing, have cited to selected language in the Clark opinion as support for the position that a right of action exists for the plaintiff in the present matter. In Clark, we said:
It is true, that the purchaser of property is presumed to purchase all actions appurtenant to the property, and necessary to its perfect enjoyment; but as to damages actually suffered before the purchase, we know of no other principles governing the case than those referrable to this general provision of the code, that every act of man that causes damage to another obliges him by whose fault it happened to repair it. It is a mere corollary, that the reparation must be made to him who suffered the injury. And the principle is strikingly illustrated by this case. The plaintiff, after possessing *264 the property twenty months, claims one-third more damages than he gave Mrs. Springer [the immediate former owner] for his lot with all the buildings and improvements. This leads to the impression, that the modicity of the price he gave for the premises may, perhaps, be attributed to their dilapidated and dangerous situation, on account of the erection of the ice house and other causes. It is impossible, from the law, to concur with the district court, that these damages, which probably caused the moderate price given for the house and kitchen, should be a source of profit to the purchaser, who had a perfect knowledge of their existence when he purchased.
The plaintiff, and the court of appeal on rehearing, rely on this language to contend and assert, respectively: (1) Eagle Pipe is the only party which has suffered damage because the sellers here, the Former Property Owner Defendants, did not have to accept a reduced price for apparently damaged property; (2) Art. 2315 provides a remedy to a damaged party; therefore, (3) Eagle Pipe has a right of action to seek damages. The plaintiff and the court of appeal on rehearing are in error.
The language in Clark, understood in context and giving effect to subsequent portions of the opinion, as well as principles of property law and obligations law, shows that such an interpretation is unsound. Louisiana law provides that when property is damaged through the actions of another, the owner of the property (obligee) obtains a personal right to demand that the tortfeasor (obligor) repair the damage to the property. La. C.C. art. 2315 ("Every act whatever of man that causes damage to another obliges him by whose fault it happened to repair it."). This personal right of the property owner arises because his real rights in the ownership of the property have been disturbed—his use, enjoyment or disposal of the property.
The analysis in Clark continued beyond the portion above-cited, making clear that each successive owner of the property was recognized as having a right to sue for the damage to the property which occurred during his or her ownership. This right of action arose when the real rights of the owners were disturbed by the operation of the adjoining business:
The damages which occurred while Herriman owned the premises, belong to him; a part belongs to Gregg in like manner; and Mrs. Springer is entitled to what happened while she owned the property. Did she or they transfer their claim to damages to the plaintiff? The claim is an incorporeal right, and strictly personal property.
Id., 6 La.Ann. at 409. Clark makes clear that the former property owners still have a personal right of action against a tortfeasor for the damage he inflicted on the property while they were the owners, despite the fact that they no longer own the property.
Clark explicitly states the personal right of the property owner to demand damages for the injury to the property must be assigned or subrogated if the personal right is to survive a change of ownership in the property:
[The former owner's] bill of sale to the plaintiff is in the usual form for the conveyance of real estate and its appurtenances. It does not transfer her claim for damages, expressly, nor is there any thing in it which indicates a transfer by implication. The rights and appurtenances mentioned in the bill of sale have always been considered real rights. It does not appear, therefore, either by law *265 or contract, that the plaintiff has any claim for damages previous to the 16th of May, 1848, when he purchased the property.
The plaintiff in Clark brought suit against a third-party tortfeasor seeking damages for the condition of the property, not a suit against his vendor. We have already discussed that the Civil Code provides a cause of action in redhibition for a buyer who discovers defects in the purchased property which were not apparent at the time of the sale. When the defect is not apparent, the buyer may seek rescission of the sale or a reduction in the purchase price. However, the Civil Code does not provide a cause of action or a right to rescission or a reduction in the purchase price for the buyer against his seller where the damage to the property is apparent at the time of the sale.
Consequently, Clark, who had a "perfect knowledge" of the dilapidated and dangerous condition of the premises when he purchased the property, had no right of action for damages, or for reduction of the purchase price, against his vendor for a breach of the warranty against defects or vices in the thing sold which were known to him at the time of sale. But neither did Clark have a right of action for damages against the tortfeasor responsible for the condition of the property before Clark was the owner. As Clark explains, the apparent damage was taken into consideration for the purchase price and the court would not allow the known damage to be "a source of profit to the purchaser" by allowing the buyer a further right of action against the tortfeasor who damaged the property before his purchase. Clark, 6 La.Ann. at 409. Instead, the personal right of action for damages belonged to the former owners of the property, each having the right of action to s