Opinion ID: 39695
Heading Depth: 2
Heading Rank: 3

Heading: The Breach of Contract Claim: Post-Contractual Designs Created by Harrell Equipment

Text: 33 Regarding the Modtrack designs created after Condrey and Harrell Equipment entered into the licensing agreement, Condrey claims that the district court overlooked evidence that established a genuine issue regarding whether he overcame the presumption of ownership in favor of SunTrust and Harrell Equipment. The contract specifically looked to Louisiana law as its governing body but the magistrate judge determined that the subsequent drawings, which are not the subject of any contract, are governed by Georgia law, since the transactions or occurrences took place in Georgia. Specifically, the magistrate judge stated, In the absence of a Louisiana contractual provision governing the ownership of the disputed property, the issue of ownership of the property in question must be determined under Georgia law. The parties disagree as to which law applies. Nonetheless, this choice-of-law issue need not be decided because under either state's law, possession of a thing creates a rebuttable presumption of ownership. Hattaway v. Keefe, 191 Ga.App. 315, 381 S.E.2d 569, 572 (1989) (One in possession of personal property is presumed to be the owner until the contrary appears, and the burden of rebutting the presumption is upon the party claiming adversely to the one in possession.); La. Civ.Code Ann. art. 530 (1987) (The possessor of a corporeal movable is presumed to be its owner.). Thus the question is not which law applies, but whether Condrey presented evidence sufficient to raise a genuine issue as to whether he rebutted the presumption of ownership, as the burden of rebutting the presumption is upon the party claiming adversely to the one in possession. Hattaway, 381 S.E.2d at 572. We conclude that Condrey has not met this burden. 34 Condrey's main argument is that he and Harrell Equipment agreed, as part of consideration for the contract, that the subsequent drawings would belong to Condrey. Condrey also contends that the data were their intellectual property and were created pursuant to a joint effort between Condrey and Harrell's employees. Unlike the argument regarding the initial drawings, this assertion evokes a definitive answer. The contract specifically states that the consideration offered by Harrell Equipment is a $20,000 one-time payment and subsequent five-percent royalties. The contract mentions no other consideration. Reading the contract with the integration clause in mind, allowing such an argument to stand would contravene basic principles of contract interpretation by altering the face of the Condrey/Harrell Equipment agreement. Furthermore, this parol evidence is the only evidence proffered by Condrey regarding his ownership of the drawings and blueprints. Thus, as the district court stated, we agree that Plaintiffs have failed to establish a genuine issue of material fact to rebut the presumption that Harrell owned the data. 35 In addition to his consideration argument, Condrey also asserts that the deposition of Hugh Harrell confirms Harrell's affidavit and Condrey's testimony. This testimony, however, is inadmissible parol evidence. In his deposition, Harrell was asked, So your testimony is ... that when you and he made your initial agreement, you and he had a meeting of the minds that the engineering drawings that would be developed by Harrell Equipment Company to produce, manufacture, and improve the feeder system would at the conclusion of the contract become the property of Modtrack and Condrey. Harrell replies, I think that's fair to say. What may not be fair, according to Condrey, is the fact that this evidence, pursuant to the plain language of Harrell's testimony, is barred from our review. 36 Harrell agrees that the understanding regarding subsequent drawings and blueprints came about when he and Condrey made their licensing agreement. But as we stated above, contemporaneous oral agreements are not among the parol evidence exceptions. Accordingly, Condrey may have an arsenal of evidence sufficient to raise a genuine issue as to the presumption of ownership; unfortunately, we cannot allow such inadmissible parol evidence to illuminate a wholly integrated licensing agreement.