“Performance Alone Does Not Rebut Article 1947”
CAM Logistics, L.L.C. v. Pratt Industries — Fifth Circuit, 2025

1. Introduction

This appeal presented the Fifth Circuit with a deceptively simple question that recurs in commercial practice: when parties negotiate a written agreement but never sign it, can one side later enforce a multi-year term by pointing to the other side’s continued performance and monthly payments? CAM Logistics (“CAM”) provided warehousing services to Pratt (Rockwall Corrugating) (“Rockwall”) for twenty-eight months without a signed contract. After Rockwall stopped using the warehouse, CAM sued for the balance of what it believed was a three-year deal, asserting breach of contract and, in the alternative, detrimental reliance.

The district court granted summary judgment to Rockwall, finding that (i) Article 1947 of the Louisiana Civil Code presumes that parties who contemplate a certain written form are not bound until the form is executed; (ii) Rockwall’s payment of invoices did not amount to ratification or confirmation of a three-year term; and (iii) CAM’s reliance on an unsigned draft was unreasonable. The Fifth Circuit affirmed in full, thereby crystallising several important points of Louisiana contract law and their interaction with federal summary-judgment practice.

2. Summary of the Judgment

• Article 1947 applies. Because both sides bargained for a written contract, the statutory presumption that no binding fixed-term agreement exists without a signed writing controlled the analysis.
• Performance does not ≈ consent to fixed term. Twenty-eight months of invoices and payments were evidence of a month-to-month oral arrangement, not tacit acceptance of a three-year duration.
• No confirmation / ratification. The doctrines under Civil Code Articles 1842–1843 did not rescue CAM because there was no relatively null contract, and no agent exceeded authority.
• Detrimental reliance fails. Absent a definite promise by Rockwall, CAM’s three-year warehouse lease with a third party (EEIDD) was not “justifiable reliance.”
• Summary judgment proper. No genuine dispute of material fact existed; therefore, CAM’s companion motion for partial summary judgment was also correctly denied.

3. Analysis

3.1 Precedents Cited and Their Influence

1. La. Civ. Code art. 1947 – Central to the holding; the Fifth Circuit reiterated that when parties contemplate a form, a court must presume no binding contract exists until that form is executed.
2. Breaux Bros. Constr. Co. v. Associated Contractors, 77 So.2d 17 (La. 1954) – Louisiana Supreme Court precedent establishing that oral assent is insufficient where the bargain included reducing terms to writing.
3. Johnston v. Johnston, 469 So.2d 31 (La. App. 1st Cir. 1985) – Reinforced the necessity of a signed instrument where writing was a condition.
4. Harp v. Succession of Bryan and Favret v. Favret – Illustrations of confirmation theory, distinguished because those cases involved signed writings that were relatively null, unlike CAM’s unsigned drafts.
5. Breaux v. Schlumberger Offshore Servs., 817 F.2d 1226 (5th Cir. 1987) and Newport Ltd. v. Sears, Roebuck & Co., 6 F.3d 1058 (5th Cir. 1993) – CAM’s reliance authorities; the court distinguished them because they featured clear written or oral promises, e.g., a letter of intent signed by both sides, which were missing here.
6. Carter v. Huber & Heard, Inc., 657 So.2d 409 (La. App. 3d Cir. 1995) and Rogers v. Brooks, 122 F. App’x 729 (5th Cir. 2004) – Applied to underscore why detrimental reliance fails when negotiations foresee a formal writing.

3.2 Court’s Legal Reasoning

1. Determining Intent to be Bound
   The court combed through e-mails, draft agreements, and deposition testimony. Both Patrick Shea (CAM) and John Batts (Rockwall) expressly sought legal-department approval and drafted formal contracts—classic indicators that execution would precede obligation. That sufficed to trigger Article 1947.
2. Rebutting the Article 1947 Presumption
   CAM argued that Rockwall’s monthly payments were a “tacit acceptance” of the three-year term. The panel disagreed: the invoices did not mirror the stepped-up pricing contained in the drafts; therefore, payment behaviour was consistent only with an at-will, monthly deal. No Louisiana or Fifth Circuit case holds that mere performance, without more, overrides Article 1947 when the disputed term is duration.
3. Confirmation & Ratification Doctrines
   • Confirmation (Art. 1842) cures a “relative nullity” such as lack of capacity or vitiated consent. Because there was never any consent to a fixed term, there was no null contract to cure.
   • Ratification (Art. 1843) presupposes an agent who exceeded authority. Batts repeatedly disclaimed authority and never executed a fixed-term contract, so there was nothing to ratify.
4. Detrimental Reliance Analysis
   Element 1 failed: there was no “representation by conduct or word” promising three years. Even if Rockwall speculated about three years, speculation ≠ promise. Thus elements 2 and 3 (justifiable reliance & detriment) never came into play.
5. Summary-Judgment Methodology
   Applying Rule 56, the panel emphasised that the non-movant (CAM) must identify specific evidence creating a genuine issue of material fact—here, evidence of Rockwall’s assent to duration. None existed.

3.3 Potential Impact of the Decision

• Commercial Contracting in Louisiana – Businesses can no longer rely on past performance alone to “lock in” multi-year terms when negotiations contemplated a written contract. The case fortifies Article 1947’s presumption.
• Litigation Strategy – Plaintiffs seeking to enforce unsigned drafts must marshal evidence of an unequivocal promise (e.g., letter of intent, written confirmation) or risk early dismissal.
• Detrimental Reliance Claims Narrowed – The decision tightens the “justifiable reliance” requirement in contexts where sophisticated parties delay signature pending legal review.
• In-House Counsel Practices – Companies are reminded to maintain internal approval processes; refusal to sign until counsel approves can effectively insulate against later fixed-term liability.

4. Complex Concepts Simplified

Article 1947 (Louisiana Civil Code)

If parties plan to put their deal in a written form, the law presumes they are not bound until that form is signed, unless the presumption is rebutted.

Relative Nullity vs. Absolute Nullity

Relative null contracts protect private interests (e.g., lack of consent) and can be “confirmed”; absolute null contracts offend public order and cannot be cured.

Confirmation (Art. 1842)

A later act (usually by the party protected) that cures relative nullity, making the obligation fully effective.

Ratification (Art. 1843)

Adoption of an obligation created by an agent who lacked authority. Requires knowledge plus acceptance of benefits.

Detrimental Reliance

Similar to “promissory estoppel”: a party who makes a promise that induces another to rely can be held liable, but only if the reliance was reasonable and a promise truly existed.

Summary Judgment (Fed. R. Civ. P. 56)

Early dismissal mechanism where there is no genuine dispute of material fact. The moving party must show entitlement to judgment as a matter of law; the opponent must produce evidence to the contrary.

5. Conclusion

The Fifth Circuit’s decision in CAM Logistics v. Pratt Industries draws a bright line: when sophisticated parties defer signature until legal formalities are complete, months—or even years—of performance will not silently convert an at-will relationship into a fixed-term contract. Article 1947’s presumption stands tall, and doctrines of confirmation, ratification, and detrimental reliance cannot be repurposed to bypass it without unequivocal evidence of consent.

For practitioners, the lesson is twofold: (1) memorialise any intended binding terms in a duly executed instrument, and (2) do not rely on performance alone to establish duration. Businesses that wish flexibility should maintain—and document—clear approval protocols. Conversely, parties seeking certainty must insist on signatures before investing in long-term obligations. In the perennial tension between handshake deals and formal contracts, CAM Logistics cements the primacy of the latter under Louisiana law.