author: BEER, Judge. PER CURIAM.

text:
    Paul E. GEISLER v. LOUISIANA POWER AND LIGHT CO. and J. Melton Garrett.
    No. 8109.
    Court of Appeal of Louisiana, Fourth Circuit.
    May 17, 1977.
    Rehearing Denied June 7, 1977.

      Henry L. Klein, New Orleans, for plaintiff-appellant.
    Monroe & Lemann, Andrew P. Carter, Eugene G. Taggart, Kenneth P. Carter, New Orleans, for defendant-appellee.
    Before LEMMON, STOULIG and BEER, JJ.
   BEER, Judge.

On September 10, 1973, Paul E. Geisler suffered serious electrical burns while working atop the roof of the Lapalco Shopping Center, then under construction, in Gretna, Louisiana. As a result, his left foot was amputated. Subsequently, he sued Melton Garrett, the owner of the shopping center, and Louisiana Power & Light Co. (hereafter, “LP&L”), owner of the overhead electric power line located at the site of the accident, and, by supplemental pleadings, added other defendants. LP&L denied negligence, pleaded Geisler’s contributory negligence and assumption of risk, and filed various third party demands. Prior to trial, Geisler settled with some defendants and, during the first day of trial, entered compromise agreements with all remaining defendants except LP&L, who, thereupon, reserved its right to pro rata reduction by reason of the settlement. The trial lasted four days and resulted in a jury verdict (on special interrogatories), finding negligence on the part of LP&L and contributory negligence on the part of Geisler. Thereupon, Geisler’s demand against LP&L was dismissed, as was the petition of intervention filed by his workmen’s compensation insurer, Maryland Casualty Co. A motion for new trial was denied, and Geisler devolu-tively appeals. LP&L answered the appeal to protect its right to pro rata reduction of any judgment rendered against it.

At trial, Geisler testified that he had worked 16 years for Poley’s Sheet Metal, Inc., doing “gutter work and downspouts.” He had been working at the construction site for about a week prior to the accident and had inspected the premises “to see where the drains were going through the front of the building.” On the day of the accident, Geisler arrived at the site around 8:00 a. m. and began installing “L-flashing” (a 10-foot, L-shaped piece of metal which covers the crack formed at the joint between the wall and the side of the building to prevent water seepage to the interior). After lunch, he installed fiberglass “roof jacks” which covered the pipes protruding from the roof to prevent leakage from the pipes. His next job was to install 20:foot gutters. Geisler decided that the best method of getting the gutters from the floor of one of the interior rooms of the building (where they were stored) to the roof was through an air conditioning duct opening. With the assistance of Vernon White, he maneuvered the length of gutter up to the opening. Then, he and White went to the front of the building and climbed a ladder to the roof. Geisler could see six or seven feet of the gutter protruding from the duct opening. He was aware of the proximity of the power lines but contends that he did not realize that they were uninsulated and energized since he saw no warning sign to indicate that there was high voltage in the lines. With his back to the lines, he and White negotiated the first gutter section out of the opening, “hand over hand,” and, together, they carried it to the edge of the building. The second gutter section was handled in the same manner. During the maneuvering of the third section of gutter, Geisler suffered electrocution. White was not electrocuted.

On cross-examination, Geisler acknowledged that he was aware that power equipment was being used at the construction site and realized that it was dangerous to allow metal to touch the overhead power lines presumably supplying electricity to the building site. He also acknowledged that from the interior of the building, looking up through the air conditioning duct opening selected for the upward passage of the gutter sections, one could see the power line approximately 10 feet from the edge of the roof. He did not instruct his helper, White, to watch out for the power lines, nor did he position himself in a way anticipated to avoid contact between the lines and the metal gutter section as he pulled the guttering out of the opening in the roof even though the power lines were at his back and a portion of the gutter was leaning against (and beyond) his shoulder.

At no time did he request LP&L to temporarily de-energize the power lines in question.

Vernon White testified that he was not touching the gutter section when the accident occurred. His testimony regarding the events leading up to the accident generally corroborate Geisler’s account. Asked during cross-examination if he knew that one who works with sheet metal on a roof top must be on the lookout for overhead power lines, he responded: “Common sense would tell you to look out for that.”

John Poley, president of Poley’s Sheet Metal, Inc., testified that he had been on the roof prior to the accident and could see the power lines at that time, but did not realize that 13,800 volts ran through them. He was aware that the service connection at the back of the shopping center site was sufficient to operate power tools. He did not request that the lines be de-energized and had, previously, shown Geisler the pole where he could pick up his service for his drill motor and stuff, and that was in the back of the shopping center.”

In Dyson v. Gulf Modular Corp., 338 So.2d 1385 (La., 1976), plaintiff was electrocuted while holding a cable which came in contact with a power line. The Supreme Court applied general principles of negligence to measure the injured party’s conduct:

“Furthermore, as we perceive the question of negligence, the determinative issue is always one of reasonableness or duty — i. e., did the party’s conduct conform to the standard of care that would be exercised by a reasonable man; or did the conduct breach a duty imposed upon the party to protect against the particular risk from which the accident resulted. Hill v. Lundin & Associates, Inc., 260 La. 542, 256 So.2d 620 (1972); Pierre v. Allstate Insurance Company, 257 La. 471, 242 So.2d 821 (1970); Tri-State Insurance Co. v. Tidewater Trailer Mfg. Co., 312 So.2d 353 (La.App. 2d Cir. 1975); Page v. Green, 306 So.2d 847 (La.App. 2d Cir. 1975); Robertson, Reason Versus Rule in Louisiana Tort Law: Dialogues on Hill v. Lundin & Associates, Inc., 34 La.L.Rev. 1 (1972).”

Here, Geisler made the decision to maneuver long pieces of metal guttering in close proximity to power lines. The jury found this conduct to be contributorily negligent. We may not substitute our own factual determinations for well-supported findings by the trier of the fact. Dyson v. Gulf Modular Corp., supra; Canter v. Koehring Co., 283 So.2d 716, 724 (La., 1973).

Appellant’s able counsel vigorously contends that LP&L committed reversible error by placing certain federal regulations into evidence. Our review of the record indicates that during the cross-examination of Mr. Poley, counsel for LP&L posed various questions concerning adherence to regulations of the Occupational Safety and Health Administration, particularly those concerned with an employer’s duty to request that electrical circuits be de-energized prior to allowing his employees to commence work in close proximity thereof. However, the record also shows that counsel for Geisler posed questions to Mr. Poley regarding fulfillment of his alleged obligations covered by those same regulations. After Poley had answered those questions propounded by plaintiff’s counsel, the following took place:

MR. TAGGART: (COUNSEL FOR LP&L)
Your Honor, in connection with the last witnesses’ testimony, on my cross examination I would like to introduce into evidence Section 1926-240 of the OSHA regulations.
THE COURT:
Allright, sir. Ladies and gentlemen of the jury, the document that has been just introduced into the record is a document you notice I didn’t ask Mr. Klein if he objected or didn’t object. This is a Federal regulation authorized by Congress and is one of the laws that control this type of situation. We have the duty to follow that law the same as we do all Louisiana law. This is a law that creates whatever it creates in your mind, you are to read this and give it your best interpretation.
MR. KLEIN: (PLAINTIFF’S COUNSEL)
Let me reserve my right to introduce sections of that.
THE COURT:
Certainly, the entire regulations will be part and parcel of the record of this case. Counsel for the plaintiff may bring in any part that he wants. For ease of handling Mr. Taggart has that one particular area that he is interested in, however, we will have the book available to you.
MR. TAGGART:
I have marked the photocopies and ask if these can be substituted for the true and correct copies of Section 1926-240 marked LP&L No. 5.
MR. KLEIN:
Your Honor, I am reserving my rights subject to these entire regulations.

Later, when the jury was recessed, plaintiff’s counsel objected to the introduction of the OSHA regulations, stating: “I didn’t get a chance to object on the record because it was improper to do so in front of a jury.” LP&L’s counsel observed that Poley was a third party defendant charged with proximately causing the accident by violating OSHA regulations. Since LP&L was seeking contribution from Poley, the regulations were properly material to the merits of the third party demand.

The trial judge refused to withdraw the regulations from the evidence, stating that his instructions to the jury would settle the issue. The jury returned and the trial resumed. After all the witnesses testified, the trial judge instructed the jury:

“You have seen some evidence and heard some testimony about OSHA, which is the Occupational Safety Act. OSHA does not govern the duties owed by the utility company to Mr. Geisler, and in determining the liability of LP&L, you are to concern yourselves only with the rules of negligence which I have given you.”

Any confusion or distraction which may have been created by the introduction of the regulations was cleared up by the trial judge's instruction. Even assuming, arguendo, that it was improper for the jury to have been exposed to the regulations, such exposure was not prejudicial and would constitute harmless error. Furthermore, the objection came too late. In Jack v. Henry, 128 So.2d 62, 70 (La.App. 1st Cir., 1961), where there existed a chronology of trial events similar to those here existent, the court observed:

“At the time counsel for plaintiff objected to such evidence, the harm had already been accomplished considering that there were pages of testimony on this issue entered without objection on the part of counsel for plaintiff.”

Appellant contends that the trial judge erred in refusing to instruct the jury regarding “momentary forgetfulness”. The trial judge rejected same with the following explanation:

“The next charge was a document which I will mark, refused Charge No. 2, which I will put my initials thereon, which has to do with momentary forgetfulness. The Court refused this charge on the basis of provisions of Laine vs. Louisiana Power & Light Company being Page 35, Section 9 of 161 Southern Second No. 29. The Court does not believe that this was the circumstances momentary forgetfulness that would be applicable.”

The trial judge made no comment on his refusal to give plaintiff’s requested charge regarding LP&L’s alleged duty to warn, but, after discussing his reasons for rejecting certain proposed charges from both sides, he asked both counsel whether they had any objections. Counsel for plaintiff objected to one instruction not challenged in this appeal. The trial judge noted this single objection, whereupon plaintiff’s counsel stated:

“Other than that, I have no objection to the ones that were read. I would like to note for the record say that I object to the failure of the Court to read the ones marked refused, the ones submitted by me.”
LSA-C.C.P. Art. 1793 provides, in part: “A party may not assign as error the giving or the failure to give an instruction unless he objects thereto before the jury retires to consider its verdict, stating specifically the matter to which he objects and the grounds of his objection. Opportunity shall be given to make the objection out of the hearing of the jury.”

Blanket objections do not comply. See: Lea v. Baumann Surgical Supplies, Inc., 321 So.2d 844 (La.App. 1st Cir., 1975) writs den. La., 325 So.2d 279.

Plaintiff’s counsel also objected to the court’s refusal to apply comparative negligence. Yet, scattered sentiment favoring the adoption of a comparative negligence doctrine certainly cannot form a proper basis for contending that error has been committed, and we must reject this contention out of hand.

Finally, appellant asserts that the trial court erred in declining to answer two written questions posed by the jurors during their deliberations:

1. Is there a government law that requires public utilities, especially covering overhead power lines, to take extraordinary precautions to protect life and limbs?; and
2. Would this mean that this would require more than the strict variance of nine (9) feet?

The judge instructed the jurors to rely on their recollection of his original instructions. In Renz v. Texas and Pacific Railway Co., 138 So.2d 114 (La.App. 3rd Cir., 1962), the court quoted 89 C.J.S. Trial § 475 as follows:

“According to the rule generally adopted, the court may, at the request of the jury, give them further instructions after they have retired to deliberate, since the interests of justice require that the jury have full understanding of the case, and .the court may, without the consent of counsel, recall the jury and give additional instructions although but one juryman requests them. Furthermore, it has been said that the trial court has the same right to instruct the jury when it returns for further instructions after having retired as before the jury retires for the first time. * * *
It has been held that it is not error to refuse to give a further instruction requested by the jury, or to answer a question by the jury or a juror, as where the giving of additional instructions would only serve to confuse the jury, where the question was not concerned with substantive law, where the jury requested an answer to a question which was in the province of the jury to answer, or where the requested additional instruction was on an issue not presented by the pleadings or evidence. It is not error for the court to refuse to comply with a general request further to read the law of the case which had already been read to the jury. While the request may properly be refused, where there is a statute providing that no further instructions shall be given after the argument begins, or where the request is for an instruction which could not be given, it is usually said to be the duty of the court to give such additional instructions when requested, and a prejudicial refusal to do so has been held reversible error. * * * ”

We find that the refusal to further instruct the jury was within the court’s discretion and did not constitute reversible error.

The judgment of the 24th Judicial District Court for the Parish of Jefferson is affirmed. All costs of this appeal must be borne by the appellant.

AFFIRMED.

ON APPLICATION FOR REHEARING

Before LEMMON, STOULIG and BEER, JJ.

PER CURIAM.

For such weight as a reviewing court may see fit to accord, we agree with able counsel for applicant that a sensible interpretation of the transcript would support his contention that the actual words spoken by him in making a particular objection were: “Your Honor, I am reserving my rights to object to these entire regulations,” rather than the words actually contained in the transcript which are: “Your Honor, I am reserving my rights subject to these entire regulations.”

Our opinion remains unaffected thereby, but we believe that counsel should have the opportunity to make such use of this observation as he determines appropriate in such further proceedings as he may see fit to institute.

In this same vein, we note that our “out of hand” rejection of able counsel’s articulate and perceptive views regarding the doctrine of comparative negligence should not be interpreted, in any sense, as an intellectual rejection of same. As an intermediate appellate court, we simply do not have the authority to read comparative negligence into the law of the State of Louisiana no matter what the individual or collective views of this panel may be.

With these observations, the application for rehearing must be denied.

REHEARING REFUSED.

      . The author of this opinion pleads guilty to harboring such views.


source: Caselaw Access Project

author: BOUTALL, Judge: SCHOTT, Judge: BOUTALL, Judge,

license: Public Domain

text:
    The FIRST NATIONAL BANK OF JEFFERSON PARISH v. LOUISIANA PURCHASE CORPORATION, Overland-Louisiana, and Overland Investments, Ltd., et al.
    No. 7578.
    Court of Appeal of Louisiana, Fourth Circuit.
    May 17, 1977.
    Rehearing Denied June 7, 1977.

      Samuel Richard Exnicios, Roger R. Roy and Ronald S. Ruiz, New Orleans, for appellant and third party defendant, U. L. Roy.
    Joseph T. Casey, New Orleans, for the First Nat. Bank of Jefferson Parish, plaintiff-appellee.
    Martin A. Welp, New Orleans, for John A. Beninate, Michael Bruno, William T. Campbell and Eugene Schaefer, Jr., appellants.
    Maurice D. Armagnac, Metairie, for Kenneth J. LaGrue, defendant-appellant.
    Wiedemann & Fransen, Lawrence D. Wiedemann, New Orleans, for Eugene E. Schaefer, Jr., defendant-appellant and third-party plaintiff-appellee.
    Before REDMANN, BOUTALL and SCHOTT, JJ.
   BOUTALL, Judge:

The First National Bank of Jefferson Parish brought suit on a promissory note against a number of makers, guarantors, and others for the balance due. Several of the defendants filed third-party demands and reconventional demands against each other. The primary appeal is by those defendants who executed continuing guaranties and were found liable in solido for the amount prayed. One of the third-party defendants who was cast in indemnity for the liability of one of the continuing guarantors has also appealed.

The facts are as follows: The Louisiana Purchase Corporation, with whom all of the defendants were associated at one time or another, sought a line of credit with The First National Bank of Jefferson Parish in order to develop a real estate project it had under way. Initially there was a loan for $10,000 secured by some continuing guaranties, but as the corporation continued to borrow money it was decided that there would be a credit limit of $50,000, and additional continuing guaranties and other security was furnished. Several promissory notes were made and renewed, with the additional amounts borrowed, and the culmination of these transactions was that the bank held a promissory note dated November 8, 1971 signed by Louisiana Purchase Corporation in the amount of $38,950.72 (Thirty Eight Thousand, Nine Hundred Fifty and 72/100 Dollars) [the note sued upon] with a principal balance due of $37,192.09. This note was secured by a mortgage in the amount of $50,000 in favor of John A. Beni-nate, held in pledge, and the continuing guaranties in the amount of $50,000 each executed by Ken J. LaGrue, Kenneth Whitfield, Eugene E. Schaefer, Jr., William Campbell, Michael Bruno and John A. Beni-nate. These guarantors, with the exception of Whitfield, have appealed asserting that, although they signed the guaranties in question, the bank has discharged them by its actions in extending the terms of the note, and releasing other securities on the note (a partial release of the $50,000 mortgage, and release of certain other mortgage notes) all without notice to the continuing guarantors and in prejudice of their ability to be repaid.

The relationship between the creditor bank and each debtor who signed the continuing guaranty is governed by the provisions of that document. L.C.C. Art. 1901 provides that agreements legally entered into have the effect of law on those who have formed them. L.C.C. Art. 3039 provides that suretyship must be expressed, and is to be restrained within the limits intended by the contract.

Each appellant has admitted execution of his continuing guaranty for $50,000. The specific language contained in the continuing guaranty binds the signer in solido with the debtor for the payment of the indebtedness precisely as if the debt had been contracted and was due and owing by the signer in person. It further made the signer a party to the note, waived notice and permitted the bank in its judgment to grant extensions, take and give up securities, accept compositions, grant release and discharges, make changes of any sort whatever in the terms of its contract and apply all monies received from the debtor or other securities as it may think best. By its terms the document provides that the bank may do exactly what it did in releasing the mortgage notes held as security, effecting a partial release of the mortgage, and extending and renewing the promissory note in the principal amount due. Additionally, we should point out that the mortgage notes alleged to be released were not held as security for the note sued upon, but were actually held as security upon another note of Louisiana Purchase which was paid in full with the proceeds from the release.

It is contended however that these provisions in the continuing guaranty are contrary to express provisions of Louisiana Civil Code, which constitute prohibitory laws, such that the provisions thereof cannot be waived or contracted against. Louisiana Civil Code Articles 11 and 12, E. L. Burns Company, Inc. v. Anthony Cashio Construction Company, 302 So.2d 297 (La.1974). Appellants insist that Louisiana Civil Code Articles 3060, 3061, and 3063 govern the issues before us and that they, as sureties are discharged. They additionally refer us to the cases of Glass v. McLendon, 66 So.2d 369 (La.App. 2d 1953); Shreveport Laundries, Inc. v. Sherman, 7 So.2d 433 (La.App. 2d 1942); and cases cited therein.

While we agree that the above quoted authorities regulate the provisions of suretyship, we point out that these appellants are not simple sureties but are debtors in solido with the principal debtor. We refer to the case of Louisiana Bank & Trust Company v. Bouttee, 309 So.2d 274 (La.1975); Louisiana Revised Civil Code Article 3045, and 2 Planiol, 768. When a solidary surety in executing a continuing guaranty instrument agrees that the creditor might, without notice, accept securities and grant releases and discharges, apply money and securities as it saw fit, without in any way affecting or lessening liability of guarantors, this was an effective waiver of any rights of simple surety claimed by a solidary surety. See also American Bank & Trust Company v. Blue Bird Restaurant & Lounge, Inc., 279 So.2d 720 (La.App. 1st 1973), affirmed 290 So.2d 302 (La.1974).

We find no error in the ruling of the trial judge casting these appellants as liable for the principal demand of the plaintiff bank, and we affirm as to that.

Before REDMANN, LEMMON, STOULIG, BOUTALL and SCHOTT, JJ.

SCHOTT, Judge:

U. L. Roy has appealed from the judgment against him in favor of Eugene E. Schaefer, Jr., for full indemnification for Schaefer’s liability to the bank on the main demand and dismissing Roy’s reconventional demand against Schaefer.

Schaefer’s third-party demand was based on a written agreement dated October 1, 1971, reading as follows:

“It is mutually agreed by the undersigned, E. E. Schaefer, Jr. and U. L. Roy, that the following terms and conditions of this contract represent the full agreement between them and constitutes the full consideration of each to the other.
1. U. L. Roy agrees to secure a complete release of liability of Schaefer for personal endorsements of mortgages granted by the Louisiana Purchase Corp. to the Fidelity Mortgage Investors, Succession of P. H. Corbett and the First National Bank of Jefferson.
2. Roy agrees to cause the Louisiana Purchase Corp. to issue to Schaefer a hold harmless agreement regarding the liability of Schaefer for his personal endorsement of the mortgage granted by Louisiana Purchase to United Ventures Corp. in the principal amount of $125,000.00. Said hold harmless agreement is to remain in full force and effect until a complete release of Schaefer’s endorsement can be obtained.
3. Roy agrees to cause the Louisiana Purchase Corp. to issue to Schaefer as compensation, one promissory note in the amount of $7,500.00 and payable over four equal monthly payments beginning October 1, 1972. Said payments are to be made in either cash or first mortgage notes with full recourse of payment or substitution.
4. Schaefer hereby agrees to deliver to Roy, without additional payment or consideration other than listed above, any and all shares he may own in the Louisiana Purchase Corp. if any have been issued to him.
5. Schaefer hereby agrees that the proxy rights to vote the shares of W. T. Campbell in the Louisiana Purchase Corp. are cancelled and of no further force or effect, said rights having been granted in the contract and agreement dated March 1, 1971.
6. Schaefer agrees that this contract supersedes any and all agreements and contracts between him and the Louisiana Purchase Corp.”

Schaefer’s position is that the agreement required Roy to secure the former’s release from liability to the bank and Roy’s failure to accomplish this made him liable to Schae-fer for the amount of Schaefer’s liability to the bank.

Roy defended on the basis that there was a failure of consideration in that the stock was never delivered and that the agreement did not contemplate that he would be substituted in place of Schaefer for his liability to the bank.

The agreement sued upon should be the law between these parties and this case would be easy to decide if the agreement were clear on its face. Unfortunately, it is so drawn that it cannot be interpreted and enforced without reliance to some extent on the testimony of the parties to the agreement. Schaefer’s counsel in oral argument to this court took the position that this agreement was drawn by Roy so that any ambiguities or failures in the agreement should be construed against him, but we find no evidence in this record to show that the agreement was drawn by Roy.

In numbered paragraph 1 of the agreement the parties speak of Roy securing a release of Schaefer’s liability on “mortgages” granted by Louisiana Purchase to First National Bank of Jefferson and others. The note sued on in this case is not a mortgage note, and while we have no difficulty deciding that the parties intended to cover this particular obligation sued on when they used the term “mortgages” this demonstrates the agreement’s lack of quality from the standpoint of draftmanship.

Numbered paragraph 1 should be contrasted with numbered paragraph 2 in that the latter specifically outlines that Roy will cause Louisiana Purchase to obtain for Schaefer “a hold harmless agreement” as to Schaefer’s personal endorsement of a mortgage by Louisiana Purchase to United Ventures Corporation. This demonstrates that the parties realized what a hold harmless agreement was and with respect to this particular liability they intended for Schae-fer to be indemnified. On the other hand, they said nothing about a hold harmless agreement in the first paragraph where Roy committed himself to get releases for Schaefer with respect to the other creditors, raising a serious question that they intended indemnity by Roy in favor of Schaefer as to these claims.

Paragraph numbered 4 of the agreement is perhaps the most difficult of all to understand and therefore the most dependent on the testimony of the parties for an explanation. The agreement is that Schaefer is to deliver to Roy “any and all shares he may own in the Louisiana Purchase Corp. if any have been issued to him.” Does this mean that Schaefer owns any stock in the company? If so, why the qualification as to stock which “he may own” and “if any have been issued to him?” If it was the intention to deliver stock contemporaneously with the signing of this agreement Schaefer necessarily had to have the stock in hand to accomplish delivery, and yet there is the qualification in the agreement to the effect that he may not have any stock issued to him at that time.

Since Schaefer is seeking to enforce the agreement, the burden of proof is on him. He has taken the position in this court that mere credibility calls and factual issued are involved so that we should not reverse the trial court in the absence of manifest error. This is obviously an oversimplification. Since his testimony of what he did on October 1,1971, is contradicted by the agreement he signed he had to provide a reasonable explanation for the discrepancy. If the explanation was unreasonable we must reach a different result than did the trial judge. Furthermore, if Schaefer’s testimony was obviously and clearly self contradictory, we must set the judgment of the trial court aside where such testimony is the only basis for his case.

The trial judge evidently rejected the testimony of Roy and L. S. Hiern and accepted the testimony of Schaefer to the effect that at the time this agreement was confected Schaefer handed to Roy an envelope containing his stock in Louisiana Purchase. This raised the obvious question on cross examination as to why the agreement contains the words, with respect to the stock, “if any have been issued to him,” and his explanation follows:

“For the very simple reason, as I explained to you before, when I made the endorsement contract with FMI, Louisiana Purchase, at that time, should have executed stock to me under the agreement for my endorsement. Mr. Campbell signed the stock certificates and Mr. Hiern refused to do so, so there may have been a question in Mr. Roy’s mind at that time.”

He had previously testified that when he came into the company originally in June, 1971, it was agreed that he would endorse the corporation note to Fidelity Mortgage Investors in the amount of $1,750,000 in exchange for which he was to be given 250,000 shares of stock and a proxy to vote the stock of William T. Campbell. At that time Hiern was president and Campbell was secretary-treasurer. The question was put to him by his attorney:

“Did you subsequently become the owner of the stock that was to be issued to you in conformity with the endorsement agreement?”

He answered:

“Yes, sir. But not until the time that Mr. Whitfield and myself assumed the presidency and secretary-treasurer of the corporation.”

He further testified that when the stock was issued to him in September, 1971, he and Kenneth Whitfield became the president and secretary of the corporation respectively. Yet in attempting to explain the meaning of the words in the agreement sued on “if any have been issued to him” he talked about Hiern’s refusal to sign stock certificates. Not only is this directly contradictory testimony but it also defies explanation because there was no reason for him to require Hiern’s signature on the stock certificates once he became president in Hiern’s place. In addition, Schaefer testified on direct examination as follows:

“Q. And on what date did you resign as the President of the corporation?
A. I resigned effective that date, October 1.
Q. Did you have any further connection with Louisiana Purchase, either as an officer or a stockholder or the owner of a proxy, after October 1, 1971, the date that you transferred that to Mr. Roy?
A. No, sir. I did not.
Q. Did you ever vote any stock in Louisiana Purchase after October 1, 1971?
A. Me myself?
Q. Yes.
A. No, sir. Not as Eugene E. Schae-fer, Jr. No, sir.
Q. Did you ever vote a proxy. I’m speaking about Mr. Campbell’s proxy?
A. No, sir.”

Ón cross examination, Schaefer was confronted with a document entitled “Majority Consent to Corporate Action.” It recited in its preamble: “The stockholders hereinafter signing their names vote their respective shares of stock for the following corporate action and individually agree to the following terms and conditions, to wit:” The agreement then authorized Louisiana Purchase Corporation to sell some of its property and authorized L. S. Hiern to have recorded mortgages cancelled against the property. The agreement continued:

“3. Louisiana Purchase Corporation hereby authorizes and permits each of its stockholders to receive unencumbered lots in Additions I and/or II of Hillcrest Country Club Estates from Housemaster Corporation in full satisfaction of any and all claims, interest and rights which the stockholder may have against Louisiana Purchase Corporation, Overland-Louisiana, L. S. Hiern and Housemaster Corporation. Louisiana Purchase Corporation further agrees and authorizes the value of each lot shall be $2,500.00.
4. Each stockholder hereinbelow signed agrees to the above terms and conditions and further agrees that all his rights, claims, causes of action, and interest arising from loans to, employment with, stock ownership in, and any other dealings with Louisiana Purchase Corporation, Overland-Louisiana, L. S. Hiera, and Housemaster Corporation, shall be settled and fully discharged at the time he receives his agreed to number of unencumbered lots from Housemaster Corporation. He further agrees that the stated value of each lot shall be $2,500.00.”

This agreement was signed by Schaefer as follows: “/s/ E. E. Schaefer, Jr. Number of Shares Voting: 300,000. I hereby agree to accept the amount of -7- lots, /s/ E. E. Schaefer, Jr. Feb. 1, 1973”

Schaefer’s explanation for signing this instrument was as follows:

“Mr. Schaefer:
Yes, I do recognize this instrument, and it ties in directly with the instrument that you showed me before with the three hundred thousand shares, et cetera, and again I’ll go back and tell the Court, under oath, that this was not a voting procedure in Louisiana Purchase, but a consent, because at the time the Louisiana Purchase people were questioning the contract validity of the Overland Investment contract and Mr. Hiera and Mr. Roy both had conversations with me asking me in the event that the stock was not in his name, would they be able to use it to, in effect, clear the air with the Overland Investment contract. So, I was not voting as Eugene E. Schaefer, as I said in the very beginning of my testimony, and I will stand on that. But consenting to the possibility that I would be needed if we’d get the stock back from Mr. Roy, and that’s what these two papers were all about.
Q. And you signed that paper.
A. And I signed them, right, to help give them that privilege.
Q. And it says “number of shares voting” and you filled that out did you not?
A. Three hundred thousand.
Q. And in return for which, had this gone through, you would have gotten seven lots, is that correct?
A. Correct. And that’s—
Q. You dated it February 1, 1973?
A. Right. Because that’s when the questions came up from them after once they were in with the Overland Investment people, and I agreed to help them in that position.
Q. And, I’ll ask you, the three hundred thousand shares that are listed there, are those the shares in the proxy, or are those the shares that were originally issued to you in September of ’71?
A. I would have to say that those were the amount of shares they felt that they needed to accomplish the Overland Investment valid contract purchase from Louisiana Purchase and represented the proxies.
Q. Oh, these represented the proxies? A. Yes, sir.”

Schaefer was also confronted with another document entitled Majority Consent of Shareholders to Corporate Action, which began with the preamble:

“We the undersigned shareholders of Louisiana Purchase Corporation and of Leslie Homes, Inc., a wholly owned subsidiary of Louisiana Purchase Corporation, pursuant to LSA-R.S. 12:75, hereby vote our respective shares for the following corporate action, to wit:

The agreement then went on to appoint Hiera, the representative of the two corporations to convey twenty lots to an attorney in consideration for his representation in a suit filed against Louisiana Purchase by Fidelity Mortgage Investors. The agreement was signed on May 31,1973, by Schae-fer as the owner of 300,000 shares of stock and by Schaefer as the voting proxy of W. T. Campbell for 418,599 shares.

Schaefer acknowledged that this was his signature on the document in both capacities, but he testified as follows:

“Q. But you voted shares on May 31, 1973, did you not?
A. I did not vote shares.
Q. That’s not your signature?
A. That’s my signature, but this—
Q. Majority consent agreement?
“MR. SCHAEFER:
This was an instrument that came up after the fact when Mr. Hiern and Overland Investment people were beginning to get the corporation acquired, that we were to have shares of stock to vote at that point to, in effect, go back to the meeting that I had talked about earlier with Louisiana Purchase when they were contesting the contractual righteousness of the Overland agreement to acquire Louisiana Purchase stock, and that’s why this was executed. Because Mr. Hiern, in conjunction with Mr. Roy, asked that I give them this advantage going into that meeting, which I think is reflected in the minutes of that meeting at the country club with Mr. Hiern. At his country club.
Q. So then, you did vote those shares at that time on—
A. No, sir, I did not vote these shares. I did not.
Q. What were you voting at that time? A. I was not voting anything at that time. This was not a vote, but if you will read here ‘a wholly owned subsidiary of Louisiana Purchase Corporation hereby vote for respective shares for the following corporate action.’
Q. Why did you sign that?
A. Because at the time Mr. Roy and Mr. Hiern, along with the Overland Investment people, were having a problem with Louisiana Purchase as to the contractual righteousness of the Overland agreement.”

These instruments constituted admissions against Schaefer’s own interest in this lawsuit since he consistently maintained that he delivered all of his stock to Roy in October, 1971, and was never associated with the corporation thereafter. The burden, therefore, was again on him to explain the documents, and the question is whether he met that burden.

The documents and his explanation should be considered in the light of other pertinent dates and events. On June 30, 1972, a letter was written to Roy by Schae-fer’s attorney in which reference was made to the October, 1971, agreement and Roy was called upon to comply with the obligations he had undertaken in numbered paragraph 2 with respect to the indebtedness to United Ventures Corporation. The letter concludes with the following:

“Mr. Schaefer’s transfer of his stock in the Louisiana Purchase Corporation and his cancellation of his proxy on the shares of W. T. Campbell were conditioned upon compliance with the other provisions of the contract.
“Unless Mr. Schaefer’s personal endorsement on the indebtedness to United Ventures Corporation is released, within ten days of date of this letter, we will be forced to consider the contract to be voidable and the shares of stock returnable to Mr. Schaefer at his election.”

On August 15, 1972, an agreement was entered into between William T. Campbell and Roy in which they cancelled an agreement made between them on October 12, 1971, to exercise Campbell’s proxy.

The answer and third-party demand was filed by Schaefer against Roy in these proceedings on May 15,1973, and Roy’s answer to the third-party demand was filed on June 5, 1973.

Thus, the exercise of voting rights as a stockholder by Schaefer in February, 1973, occurred six months after he had threatened Roy with cancellation of the agreement of October 1, 1971. Roy testified that he contacted Schaefer after getting the June, 1972, letter from Schaefer’s attorney and agreed with Schaefer to cancel the agreement of October, 1971, by mutual consent. Although Roy’s testimony became suspect on cross examination and was evidently rejected by the trial court it was consistent with Schaefer’s action in signing the February, 1973, agreement. In any event, Schaefer signed the instrument voting his stock after consulting an attorney with respect to his legal rights under the October, 1971, agreement and made no expressed reservation of his rights against Roy. This creates an inference that he considered the agreement cancelled. It is likewise implausible that he would exercise his rights as a stockholder again on May 31, 1973, after these proceedings had already been commenced and after he filed his third-party demand against Roy without any expressed reservation of his rights unless he considered the agreement cancelled. Furthermore, on both of these occasions in 1973 he voted as the proxy for Campbell, indicating that he had retrieved the proxy rights he gave up in the October, 1971, agreement.

We also note that his explanation for the May, 1973, agreement that it was merely an attempt to ratify the “contractual righteousness of the Overland agreement” with Louisiana Purchase Corporation has some ostensible application to the agreement of February 2,1973, since that agreement specifically involved Overland. But Overland was not mentioned in the May, 1973, agreement which was simply to convey some lots from Louisiana Purchase to an attorney as his fee for representing Louisiana Purchase in a lawsuit.

In reviewing this case, we follow the guidelines set forth by the Supreme Court in Canter v. Koehring, 283 So.2d 716 (La.1973). That case says the following:

“When there is evidence before the trier of fact which upon its reasonable evaluation of credibility, furnishes a reasonable factual basis for the trial court’s finding, on review the appellate court should not disturb this factual finding in the absence of manifest error.” (Emphasis supplied)

The case further states “. . . where there is conflict in the testimony, reasonable evaluations of credibility and reasonable inferences of fact should not be disturbed upon review . . .” (Emphasis supplied)

For this reason we have avoided, as we think the trial court did, attaching any credibility to the testimony of Hiern and Roy, for if their testimony had been believed Roy would have prevailed .n the trial court. We have found that as to the obvious conflict between Schaefer’s testimony that delivery of the stock took place and the plain wording of the October, 1971, instrument itself which questions the stock’s delivery and, indeed, its very existence; as to the documents which show that Schaefer exercised his rights as a stockholder six months after demanding that the agreement of October, 1971, be cancelled; and as to his statement in the first of these two documents that he would accept seven lots in his capacity as a stockholder as opposed to some other capacity, his explanations for these acts do not measure up to the test of reasonableness, and the basic standard under the Canter case to bind us to the trial judge’s evaluation of his credibility does not apply.

Thus, we have concluded that Schae-fer failed to prove, 1) what the agreement sued on meant in the first instance and, 2) if the delivery of the stock was required by the agreement and carried out at the time, that the agreement was not subsequently and mutually cancelled.

As to Roy’s reconventional demand, its proof depended upon his own testimony. Since the trial judge disbelieved him, we will affirm that portion of the judgment.

Accordingly, the judgment on the third-party demand in favor of Eugene E. Schae-fer, Jr. and against U. L. Roy is reversed and set aside, and the third-party demand of Eugene E. Schaefer is dismissed. The judgment on the reconventional demand is affirmed. Each party is to bear his own costs.

AFFIRMED IN PART, REVERSED IN PART.

BOUTALL, Judge,

dissenting in part.

I dissent from that portion of the opinion dealing with the third-party demand of Schaefer against Roy, and I would affirm the judgment of the trial court.

In the agreement of October 1, 1971, Roy agreed to secure a complete release of liability of Schaefer for personal endorsements of three “mortgages”, one being the subject obligation to the First National Bank of Jefferson, although it is not actually a mortgage. Additionally, he agreed to cause Louisiana Purchase Corporation to issue to Schaefer a hold harmless agreement concerning another liability of endorsement, and to cause the corporation to issue to Schaefer a promissory note as additional payment. In return, Schaefer agreed to deliver to Roy “without additional payment or consideration other than listed above, any and all shares he may own in the Louisiana Purchase Corp. if any have been issued to him.” Schaefer also agreed that the proxy rights to vote the shares of W. T. Campbell previously granted him in an agreement dated March 1, 1971, are can-celled and of no further force or effect. Both parties agree that the purpose of this agreement was to have Schaefer transfer all of his stock and voting rights over to Roy and permit Roy to get Campbell’s proxy rights in order that Roy might have complete voting control over the corporation and its activities. To put it succinctly, prior to the time of the agreement the corporate affairs had been run by Schaefer; he had failed to make a success of it, and now Roy was to take over completely and hopefully make a success of the corporate venture.

Roy was successful in removing the liability of Schaefer from most of the debts, however he was unable to persuade the First National Bank to release Schaefer from liability under the guaranty. Roy contends that the agreement never came into force and effect for lack of consideration, and that Schaefer never transferred to Roy his shares of stock. There is a direct conflict in testimony about whether the transfer took place, and the trial judge resolved this conflict by a credibility evaluation in which he chose the testimony of Schaefer over that of Roy. His decision is supported by the record.

The evidence shows that coincident with the confection of the agreement of October 1, Schaefer resigned as President and Director of the Corporation, and that Roy and his associate took over complete control of the corporation and operated it for a number of months. During all of this period there was no complaint from Roy that he did not have control of the stock formerly held by Schaefer. It was not until after Roy’s attempt to rehabilitate the corporation finally failed that any dispute arose between these parties as to their respective positions under the agreement. Simply put, the record reflects that Schaefer carried out all of the obligations imposed upon him under the contract, but that Roy, although he exerted great effort, was not able to carry out all of his obligations, and more particularly, has failed to secure the release of Schaefer’s liability under the promissory note sued upon herein.

The situation is covered by the provisions of LSA-C.C. Art. 1889:

“Art. 1889. Stipulations purporting to bind third persons
“Art. 1889. No one can, by a contract in his own name, bind any one but himself or his representatives; but he may contract, in his own name, that another shall ratify or perform the stipulation which he makes, and in this case he shall be liable in damages, if the contract be not ratified or performed by the person for whose act he stipulates.”

The trial judge granted damages in the same amount that Schaefer was required to pay to the bank, in effect indemnity. Because of the facts in this case such damages have a reasonable basis, that is: Roy’s subsequent operation of the corporation resulted in the corporation’s failure to pay its obligation to the bank, and Roy’s failure to remove Schaefer’s liability as endorser of the obligation caused Schaefer to pay that amount and damages him to that extent. Accordingly I would affirm the judgment of the trial court.

      . The terms of this document are almost precisely the terms of the document set out in the case of Louisiana Bank & Trust Company, Crowley v. Bouttee, 309 So.2d 274 (La.1975).

      . Louisiana Civil Code, Articles 11 and 12.
      “Art. 11. Conventions contrary to law or public policy; waiver of benefits
      “Art. 11. Individuals can not by their conventions, derogate from the force of laws made for the preservation of public order or good morals.
      “But in all cases in which it is not expressly or impliedly prohibited, they can renounce what the law has established in their favor, when the renunciation does not affect the rights of others, and is not contrary to the public good.”
      “Art. 12. Contravention of prohibitory law.
      “Art. 12. Whatever is done in contravention of a prohibitory law, is void, although the nullity be not formally directed.”
      Louisiana Civil Code, Articles 3060, 3061, and 3063.
      “Art. 3060. Defenses available to surety
      “Art. 3060. The surety may oppose to the creditor all the exceptions belonging to the principal debtor, and which are inherent to the debt; but he can not oppose exceptions which are personal to the debtor.”
      “Art. 3061. Loss of subrogation by acts of creditor
      “Art. 3061. The surety is discharged when by the act of the creditor, the subrogation to his rights, mortgages and privileges can no longer be operated in favor of the surety.”
      “Art. 3063. Extension of time without consent of surety
      “Art. 3063. The prolongation of the terms granted to the principal debtor without the consent of the surety, operates a discharge of the latter.”


author: PER CURIAM.

text:
    James A. MOREAU v. Richard A. TONRY et al.
    No. 8745.
    Court of Appeal of Louisiana, Fourth Circuit.
    May 18, 1977.
    Gibson Tucker, Jr., New Orleans, Luke A. Petrovich, Boras, Jerald N. Andry, Gilbert V. Andry, Joe Windmeyer, New Orleans, and Leonce Malus, Chalmette, for plaintiff-appellant.
    John R. Martzell, New Orleans, J. Wayne Mumphry, Chalmette, Charles F. Gay, III, for defendant-appellee, Richard A. Tonry.
    Donna Fraiche, Theodore L. Jones, Baton Rouge, for defendant-appellee, First Congressional District Democratic Executive Committee.
    Jay Kern and Carmack Blackmon, Baton Rouge, for defendant-appellee, Paul J. Hardy, Secretary of State.
    Before SAMUEL, C. J., and REDMANN, LEMMON, GULOTTA, STOULIG, BOU-TALL, SCHOTT, MORIAL and BEER, JJ.
   PER CURIAM.

This appeal by plaintiff, James A. Mor-eau, is from that part of a judgment of the district court which maintained an exception to the court’s jurisdiction as to those demands in his petition for nullity of judgment which prayed that: (1) he be declared the duly elected nominee of the Democratic party in the October 2, 1976 primary election; and (2) the general election of November 2, 1976 be declared null and void and a new general election be ordered.

Mr. Moreau unsuccessfully had attempted to raise these issues by an earlier appeal taken, prior to a judgment on the merits, from a judgment maintaining the jurisdictional exception. However, considering that appeal to be one taken from a nonap-pealable ruling sustaining an exception and treating the appeal as an application for writs, on April 12, 1977 the Supreme Court denied the application with the statement that relator had an adequate remedy by appeal from a judgment on the merits of the nullity action.

Following a judgment on the merits of the nullity action, Mr. Moreau perfected this appeal.

Mr. Tonry subsequently resigned from office. When the calling of a special election was imminent, this court, pursuant to La. Const. 1974, Art. 5, § 11, certified the following questions of law to the Supreme Court of Louisiana:

(1) In this action to annul a judgment dismissing an election contest suit, do the courts have the power and authority to declare Mr. Moreau the duly elected nominee of the Democratic party for the office of member of the United States House of Representatives from the First Congressional District of the State of Louisiana?
(2) In this action to annul a judgment dismissing an election contest suit, do the courts have the power and authority to declare null and void the general election for that office held on November 2, 1976 and to order a new general election?

On May 17, 1977 the Supreme Court rendered the following answers:

(1) No. The judgment in the nullity action only has the effect at most of setting aside the judgment in the election contest suit.
(2) No. There is no authority for a candidate who contests the results of a primary election to have a general election set aside after the name of the candidate elected to Congress in a general election has been certified as provided by law.

Pretermitting action on other motions (including motions by defendant to dismiss this appeal), and on authority of the Supreme Court’s response to our certificate of the fundamental questions, we affirm the judgment of the trial court only insofar as the judgment denies Mr. Moreau’s demands that (1) he be declared the duly elected nominee of the Democratic party in the October 2,1976 primary election and (2) the general election of November 2, 1976 be declared null and void and a new general election be ordered.

AFFIRMED.


author: REDMANN, Judge.

text:
    Ms. Caroline S. BLUM and Ms. Nancy P. Steinhardt v. Louis H. MARRERO, and Seale Pest Control Corporation.
    No. 7770.
    Court of Appeal of Louisiana, Fourth Circuit.
    May 19, 1977.
    Rehearing Denied June 7, 1977.

      Philip Montelepre, New Orleans, for Caroline S. Blum and Nancy P. Steinhardt.
    Stanley E. Loeb, Loeb & Livaudais, New Orleans, for Seale Pest Control Corp.
    Robert E. Couhig, Jr., Adams & Reese, New Orleans, for Louisiana Pest Control Association, Inc., amicus curiae.
    Jerry C. Paradis, Baldwin, Haspel, Rai-nold, Meyer & Reso, New Orleans, for New Orleans Independent Pest Control Operators and Suppliers Association, Inc., amicus curiae.
    Before REDMANN, STOULIG and MORIAL, JJ.
   REDMANN, Judge.

Defendant pest control company appeals from a $3,585 judgment for the cost of repairing beetle damage in a wood frame house it inspected for termite damage at the request of a real estate agent (not made a party) through whom plaintiffs agreed to buy the house from the owners (made defendants but not cast and therefore not before us on this appeal by the pest control company alone).

The principal question is whether one obliged towards a would be house-purchaser to inspect the house for termite damage is responsible for undiscovered beetle damage.

That question depends on what a “termite inspection” means, between prospective house purchaser and a pest control company which knows that the “termite inspection” is for the purpose of assuring the purchaser that the house does not have either infestation or hidden damage. The pest control company could not reasonably suppose that the prospective purchaser was unwilling to pay a contracted price for a house with damage from subterranean termites, but was willing to pay the same price for the same house with the same damage but from beetles (or another kind of termite). Thus it would make no sense (it would be an “absurd consequence” within C.C. 1945(3)) to construe a pest control company’s contract for a “termite inspection” for purposes of deciding whether to buy a house as not requiring an inspection for wood-destroying insects of all kinds found within the locale of the house to be purchased — unless the house-buyer is made aware that there are other wood-destroying insects and he elects, in order to save the presumably higher cost of a complete inspection, an inspection for subterranean termites alone. (This might be a reasonable election, since that kind of termite causes 90% — amicus curiae’s brief says 99% — of damage in this area. But it is an election that the house-owner, rather than real estate agent and pest control company, should make.)

We note also that the “termite inspection” here given was only for subterranean termites. Had there been a proper inspection for dry wood termites, the beetles would most probably have been discovered since the inspection for these two insects is similar.

We thus affirm on liability.

On quantum, we conclude that the necessity for replacing the entire floor was reasonably supported by the evidence (especially that partial replacement could have cost more), despite the possibility of a contrary inference.

Affirmed.

      . The suggestion that the prospective purchasers had therefore no contractual privity with appellant overlooks that the termite inspection was for the purchasers’ benefit and at their cost.

      . “Termite inspection” is the description in the rubber-stamped clause in the buy-sell agreement provided by the real estate agent, and there is no showing that the real estate agent requested an inspection limited to subterranean termites.


text:
    Rose Boe, wife of Charles BONOMO, et al. v. LAKE FOREST, INC.
    No. 8754.
    Court of Appeal of Louisiana, Fourth Circuit.
    May 19, 1977.
    Rehearing Denied June 7, 1977.

      Nathan T. Gisclair, Jr., New Orleans, for relator.
    Richard J. Meunier, New Orleans, for respondent.
    Before REDMANN, STOULIG and MORIAL, JJ.
   REDMANN, Judge.

We granted certiorari on a refusal of summary judgment to dismiss a petitory action because not brought against one “who is in possession or who claims the ownership” of land, La.C.C.P. 3651, on defendant subdivider’s representation that it neither possesses nor claims.

On a prior application in this case seeking review of judgment dismissing exceptions we pointed out that the exception of no cause of action could not present defendant’s factual position, although a motion for summary judgment could.

Summary judgment, however, is obtainable only on a showing of no genuine issue of material fact, C.C.P. 966. Affidavits to make such a showing must be “made on personal knowledge,” C.C.P. 967. We hold that testimony (here, on an earlier hearing on exceptions) must also be of personal knowledge in order to oblige the respondent to submit counter-affidavits. Here, there is hearsay testimony from a title abstracter and from a member of defendant’s accounting staff. Those witnesses do not have personal knowledge that any one part, much less the many lots and streets, have been disposed of. Nor were the acts of sale and of dedication of streets made part of the motion. (Furthermore, it appears that some lots may have been disposed of after this action was filed.)

Although defendant’s pleadings might be construed as a judicial waiver of any possession or claim to title, plaintiffs (if they be the owners) are entitled to a judgment against defendant on any property it may still have record title to, in order to clear up their title in the public records.

Accordingly refusal of summary judgment on the petitory action was correct.

Affirmed.

      . In view of our conclusion concerning the peti-tory action, we deem it inappropriate at this time to review the correctness of the refusal of summary judgment on the claim for damages.


author: LEMMON, Judge.

text:
    TRANSPORTATION DISPLAYS, INC. v. CITY OF NEW ORLEANS, Moon Landrieu, Mayor of the City of New Orleans, the Council of the City of New Orleans, New Orleans Aviation Board, Paul J. Stoulig, Director of the New Orleans Aviation Board and Hart and Johnson Air Terminal Advertising Company of Louisiana, Inc.
    No. 7975.
    Court of Appeal of Louisiana, Fourth Circuit.
    May 23, 1977.
    Rehearing Denied June 7, 1977.

      Martzell & Montero, John R. Martzell, New Orleans, for plaintiff-appellee.
    Philip S. Brooks, City Atty., and Jacob Taranto, III, First Asst. City Atty., and Herbert W. Christenberry, Jr., Asst. City Atty., for City of New Orleans, Mayor Moon Landrieu, and the Council of the City of New Orleans, and for the New Orleans Aviation Board and Paul J. Stoulig, defendants-appellants.
    William A. Glennon, Jr., New Orleans, for Hart and Johnson Air Terminal Advertising Co. of Louisiana, Inc., defendants-appellants.
    Before SAMUEL, REDMANN and LEM-MON, JJ.
   LEMMON, Judge.

This litigation involves an exclusive contract “to conduct the sale of advertising space and facilities” at New Orleans International Airport. The issues on appeal are (1) whether defendant New Orleans Aviation Board must conduct public bidding in awarding the contract and, if so, (2) whether the condition in the Board’s invitation for bids, which imposes responsibility for payment of residuals due under the previous contract, prevents bidding on a substantially equal basis.

Beginning in 1961 the Board entered into a series of contracts with defendant Hart and Johnson Air Terminal Advertising Company of Louisiana, Inc. for services on a commission basis in handling the sale of display advertising at the airport. The last of the series was a four-year contract beginning in 1972.

Before entering into the 1972 contract the Board for the first time advertised for bids. When the April, 1976 expiration date of that contract approached, the Board advertised for bids for a new contract through the City’s Department of Finance. The Request for Proposal, prepared by the Board, outlined the various required provisions of the contract to be executed and called for the bidders to offer a percentage of “collected gross sales derived from the sale of all advertising spaces, displays and facilities” or a specific sum, whichever is greater. The Request for Proposal also notified bidders that residuals due to Hart and Johnson under the 1972 contract (25% of gross receipt on each existing advertising contract for up to 30 months) would be “the responsibility of the successful bidder and will not be paid from the Board’s guarantee minimum or from the percentage of gross”.

Two bids were submitted, one for 52V2% of all gross receipts with a $500,000.00 minimum guarantee by Hart and Johnson and the other for 50% of most gross receipts and a higher percentage of others with a $490,-000.00 minimum guarantee by Transportation Displays, Inc. (TDI), a Louisiana subsidiary of a national advertising agency. Shortly thereafter, but before the bids were to be opened, TDI filed this suit, seeking to enjoin the Board from accepting any bids under the original invitation for bids and requesting the court to order resubmission of the invitation for bids without the requirement as to the residual condition. The court granted the requested relief, and the Board, the City, and Hart and Johnson appealed.

Applicability of Public Bid Law

Defendants first contend that the public bidding law, although applying generally to contracts for services, does not apply to this contract because of the professional services exclusion. This contention requires an analysis of the nature of services performed under the contract.

The business of airport terminal advertising, while highly specialized, is obviously not non-competitive. The question as to whether competitive bidding by firms providing these services is feasible and is contemplated by the public bidding laws must be determined by the terms of the contract required of the successful bidding firm and the services performed by the present firm.

The invitation to bid stipulated that the contract with the successful proposer contain provisions granting the proposer “the exclusive right to conduct the sale of advertising space and facilities as set forth in the contract in the terminal building and adjacent facilities at the airport” and requiring the proposer “when necessary (to) design, plan, and supervise the construction of displays to occupy the advertising space, or assist the advertiser in such functions as required, and sell such advertising space and facilities in accordance with accepted advertising principles”. Another required provision called for the initial allotment of advertising space and locations for advertising displays in accordance with a layout exhibit on which the space and locations were marked, but provided further for Board approval of any use of space not specifically allocated. Other pertinent provisions required the proposer to “supply necessary sales efforts and costs for the selling of any and all displays”, to “approve and be responsible for the quality of displays installed in the terminal”, the Board reserving the right to approve and disapprove any advertising contract or display, and to “supply all facilities and displays to be used in the Terminal”.

Under the overall scheme of the operation and the required contract the successful proposer contracts directly with the advertiser, subject to Board approval, and the advertising contracts are assigned to the Board in the event of termination or cancellation of the services contract. Significantly, the existing printed form advertising contracts contained in the record (P-18 and 19, in globo) require the advertiser client to furnish all displays and to maintain all visual, audio and animated components of the display.

Our analysis of the numerous exhibits, as well as the extensive testimony, leads to the conclusion that the principal function of the Board’s agent is to sell advertising space and to own and maintain the cases in which the advertising displays are contained. The agent is even told the amount and location of the displays. The displays themselves, the production of which apparently requires creativity, skill, taste and artistic talent, are produced by others and supplied to the agent, whose approval and responsibility for the quality of the displays is subject to the Board’s approval.

The testimony of the Director of Aviation supports this conclusion. He stated that the display advertising agent sells advertising space to potential advertisers, that the sale “results in a display being installed in the airport”, and that the agent has an employee who regularly maintains the displays.

Hart and Johnson’s president testified that an ordinary advertising agency cannot sell airport advertising because an airport specialist calls on other agencies’ customers. However, nowhere in his testimony did he describe or even mention any activities besides selling.

The personal services exclusion (by statute or by court rule) from competitive bidding of public contracts has generated considerable litigation. See 15 A.L.R.3d 733 (1967). Generally, the public body is allowed to exercise discretion in contracting for services which require use of creative and individual talents or unique artistic skills, or which require counseling and advice based on training and experience in fields of science or learning, or which otherwise require such extraordinary skill and learning that other factors far outweigh monetary considerations in determining the acceptability of the bidder.

Perhaps the “professional services” exclusion in the present case is more restrictive than the “personal services” exclusion discussed above. Or perhaps the word “professional” should be broadly interpreted to include any unique personal services for which the competitive bidding requirements would not serve the best interest of the public. From either view this record does not show that the selling services contemplated by the contract under consideration are the type of services which are properly excluded from public bidding.

Effect of the Residual Payment Condition

The prospective bidder on the 1976 advertising contract was required by the invitation to bid to be responsible for the residuals the Board was obliged to pay Hart and Johnson under the provisions of the 1972 contract. TDI’s opposition urged that this requirement tends to exclude new bidders who must consider that a substantial part of its gross income will go to the losing incumbent contractor.

TDI’s vice-president calculated, in preparing its bid, that more than $76,000.00 would be due to Hart and Johnson over a 30-month period. He stated that if his firm had not been required to pay this amount to Hart and Johnson, he could have submitted a higher bid.

A firm desiring to bid on the 1976 contract, in order to decide the percentage of “collected gross sales” to offer the Board, had to estimate the total amount of gross sales and also to determine the least amount it would take for its services. Because of the residual provision every bidder had to deduct from anticipated gross sales the amount of the Board’s obligation to Hart and Johnson for fees already earned under the terms of the 1972 contract, and the total amount of gross sales available for consideration as to the Board’s percentage and the agent’s fees was accordingly reduced as to all bidders. In effect the residual provision was a reservation by the Board of the amount necessary for payment of an obligation already incurred by the Board with respect to part of the anticipated gross sales.

The 1972 contract had entitled Hart and Johnson to the residuals, no matter which firm was the successful bidder on the 1976 contract. The fact that this amount of the gross sales anticipated during the term of the 1976 contract was already committed and thus unavailable for any bidder to consider in determining the percentage to offer the Board may have created a disadvantage to the Board, but did not create a disadvantage to a particular bidder, since all bidders had to consider-this obligation in preparing bids. Perhaps TDI is really questioning the wisdom of the 1972 contract provision, but it is not the function of the judiciary to determine such issues.

We therefore conclude that the bidding provision requiring the successful bidder to pay from collected gross sales an already incurred obligation of the Board did not prevent bidding on a substantially equal basis. Although we have also concluded that the 1976 contract was subject to public bidding, there was really no complaint that the proper bidding procedures were not followed. The question as to whether the contract was subject to public bidding was merely ancillary to the attack on the residual provision as stifling of competitive bidding.

Accordingly, the judgment of the trial court is reversed, and it is now ordered that plaintiff’s suit be dismissed. Each party is to bear its own costs.

REVERSED AND RENDERED.

      . Section 6-307(5) of the Home Rule Charter of the City of New Orleans, provides:
      “Except in the purchase of unique or noncompetitive articles, competitive bids shall be secured before any purchase, by contract or otherwise, is made or before any contract is awarded for construction, alteration, repair or maintenance or for the rendering of any services to the City, other than professional services, and the purchase shall be made from or the contract shall be awarded to the lowest responsible bidder after advertisement prescribed by ordinance or by applicable State law.” (Emphasis supplied)

      . The Hart and Johnson firm has contracts with 33 airports and is the only national firm which handles airport advertising exclusively. TDI has contracts with 80 airports, but also sells display advertising in commuter railway systems, and its parent corporation handles other transportation advertising. Few other agencies handle multi-airport advertising.

      . At the time of the first contract in 1961, the Board purchased and installed all display cases. Under the 1965 contract Hart and Johnson purchased and installed display cases, subject to a payment schedule and subject to Board approval of the number, cost and location of the cases. The 1968 contract required Hart and Johnson to supply and own all “cases and displays”. The 1972 contract required Hart and Johnson to supply all “facilities and displays”.
      In 1976 Hart and Johnson owned all the advertising equipment. (Since, as will be seen later, the advertiser furnished all displays, the equipment apparently consisted of the display cases). Its president testified that the equipment represented a capital investment of $30,-000.00 to $50,000.00.
      There are no photographs of any displays or display cases in the record. Hart and Johnson’s brochure (attached to P-10) indicates that the firm is not a “display builder”, but “rather a sales organization with creative abilities to help design interesting displays for air terminals”. The brochure also indicates the firm supplies clients with “standard” display cases, but as to non-standard cases or freestanding units, “(t)hese units are furnished by the client” and “Hart and Johnson furnishes only the approved display area”.

      . For example, this officer distinguished their agency from a concessionaire, who has income from sales in a certain area of the airport, while his firm generates its income from sales made outside. In the same context he defended the residual provision on the basis of entitlement as a salesman to a portion of the continuing revenues that the original sale generates.
      His overall testimony indicated that the firm’s job is production by sale of a client-advertiser and not production of the advertiser’s display materials. Logical analysis also indicates that each advertiser would generally have a public relations firm or advertising agency to coordinate its overall advertising program and to furnish displays consistent with that program, while the airport agent merely sells the space in which are displayed the materials which the individual advertiser furnishes.

      . “Professional” is not used here to describe the quality of the services or to distinguish the highly proficient from the mere amateurs, but rather denotes a person in a profession which requires years of education and service for one to attain competence and which calls for a high order of intelligence, skill and learning.

      . If the City were to hire an advertising agency to attract tourists by designing an advertising program for that purpose for use in airports throughout the country, perhaps that contract would be appropriate for exclusion from public bidding, since the City under those circumstances should exercise discretion in hiring an agency whose creativity and skill best suits the purpose. But in the present case it is the advertiser who employs such an agency, and the City’s agent merely sells space to the advertiser.

      . The residual condition in Hart and Johnson’s 1972 contract was as follows:
      “Upon termination of the contract for any reason, the Firm shall receive 25% of all gross receipts received from the advertisers on all contracts negotiated and consummated for the balance of the term of such customer contract, without reference to any guaranteed sums. At the time of termination all customer contracts shall be assigned to the Board, and the Board will pay to the Firm, on a quarterly basis as collected, the 25% of the actual collected gross revenue until such time as such customer contracts then in force have expired, or for 30 months from the contract date, whichever is less. The Firm will not be required to maintain the displays during the time it received the aforesaid 25% receipts.”

      .Much more apparently stifling of competitive bidding was the requirement that the bidder “have existing contracts with at least five (5) air terminals . ..” However, that issue was neither raised nor argued and is not properly before us.

      . Indeed, TDI’s vice-president emphasized that the estimated $76,000.00 “represents the amount lost to the New Orleans Aviation Board as potential increased revenue (over the period of the 1976 contract) because of the residual clause”. This amount, however, is “lost” to the Board regardless of which firm is the successful bidder.


author: COLE, Judge.

text:
    PARISH OF EAST BATON ROUGE v. Earl D. THOMAS et al.
    No. 11250.
    Court of Appeal, State of Louisiana, First Circuit.
    May 9, 1977.

      Joseph F. Keogh, Parish Atty., Charles E. Pilcher, Asst. Parish Atty., Baton Rouge, of counsel for plaintiff Parish of East Baton Route appellee.
    Vanue B. Lacour, Baton Rouge, of counsel for defendant Earl D. Thomas et al. appellant.
    Before LANDRY, EDWARDS and COLE, JJ.
   COLE, Judge.

The Parish of East Baton Rouge filed suit to expropriate a parcel of land owned by Earl D. Thomas and his wife, Jacquelyn K. Thomas, (landowners) to be used for a drainage canal. The landowners appealed the award of compensation made by the trial court. We affirm.

The trial court in written reasons succinctly and accurately described the subject property and proposed taking as follows:

“As reflected by the exhibits filed in the record, the subject property is a portion of a rectangular shaped tract of land that fronts 229 feet bn Thomas Road near its intersection with the Baker-Scotland-ville Highway, which larger tract contains approximately 4.623 acres in size. The front portion of the site is partially cleared and relatively level while sloping to the rear which is low, heavily wooded and subject to periodic inundation during heavy rains. All utilities are available and zoning is A-4 multi-family residential. The Parish proposes taking 1.156 acres for the construction of a drainage canal (Beechwood Lateral of Cypress Bayou) and 0.449 acres for a temporary construction servitude for the stockpile of soil. There are no improvements in the taking; however, there is a wood frame residence located on the front portion of the site. The front remainder is 2.484 acres in size and both parties agree that there are no damages to this portion as a result of the taking. However, the proposed drainage canal and spoil area will leave a 0.983 land-locked rear remainder as a result of the taking, indicating that severance damages are due to defendants as the rear remainder will have no access and an after value only to abutting owners.”

One appraiser, Kermit W. Williams, testified for the landowner; two appraisers, Dan Carlock and John C. Doiron, Jr., testified for the Parish. After a careful review of all aspects of the appraisal reports, including a synopsis of each appraiser’s testimony in the written reasons for judgment, the trial court determined that the valuation of Carloek was correct, as indicated by the court below:

“Value Estímate Before.$18,492.00
Value Part Taken_ 4.624.00
Indicated Remaining Value _$13,868.00
Remaining Value.. 10.329.00
Indicated Damages_ 3,539.00
Use of Construction Servitude 359.00 Total Just Compensation_$ 8,522.00”

The landowners contend that the trial court erred in valuing the property based on a highest and best use as single-family residential property instead of multi-family residential property in accordance with its A-4 (multi-family) zoning classification. The landowners’ appraiser valued the whole property before the taking at $16,700 per acre based on a highest and best use as multi-family residential property, whereas both of the appraisers for the Parish based their valuations on a highest and best use as single-family residential property.

In expropriation proceedings the landowner is entitled to just and adequate compensation for the land taken based on the highest and best use of the property. State, Department of Highways v. Ponder, 345 So.2d 106 (La.App. 1st Cir. 1977); State, Department of Highways v. Covington Interstate, Inc., 295 So.2d 828 (La.App. 1st Cir. 1974).

In discussing the determination of the highest and best use of property sought to be expropriated, this Court in State, Department of Highways v. St. Tammany Homestead Association, 304 So.2d 765 (La. App. 1st Cir. 1974), has said:

“It is well settled that potential use of condemned property may be deemed its best and highest use for purposes of evaluation, where there is reasonable expectation that property may be so utilized, developed or employed in the not too distant future. * * *
“Where potential use is reasonably prospective, or reasonably certain to the extent that such use is removed from the realm of guesswork, speculation and conjecture, such potential use may be considered the best and highest use for fixing value in an expropriation proceeding. * * * ” (304 So.2d at 771)

In the instant case there was ample evidence on which the trial court could base its determination that a use of the property for multi-family dwellings was not reasonably prospective, but speculative and conjectural. Both appraisers for the Parish admitted the possibility of such a use in the future. However, both also contended that such a use was too speculative to form a basis for their valuations in light of the lack of demand for apartments in the area and the prevailing use of the property in the area for single-family subdivisions. Many of the comparables used by the landowners’ appraiser to establish the value of the property for use as a site for multi-family dwellings were either close to Southern University where there was a greater demand for apartments or were federally financed, and thus, not necessarily indicative of the subject property’s market feasibility for multifamily dwellings.

The landowners contend that the A-4 (multi-family) zoning classification of the property must be given serious consideration in determining the highest and best use of the property, citing State, Department of Highways v. St. Tammany Homestead Association, supra. In that case this Court merely said:

“It is also settled that zoning restrictions must be given serious consideration in determining whether a higher potential use than that allowed by zoning laws may be ascribed to a property condemned for public purposes. * * * ” (304 So.2d at 772)

We note that the case cited differs from the case in point to the extent that the landowner therein was urging a higher use than that for which the property was zoned. The zoning classification was interposed by the State to support its contention that the use urged by the landowner was not reasonably prospective because it was restricted by law. While it is evident that zoning classifications and restrictions are to be given serious consideration in determining the highest and best use of property, they are not determinative. When property is zoned for a use for which there is no reasonable expectation that the property may be so utilized, a lesser included use may be deemed, as here, to be the highest and best use for purposes of valuation.

The landowners also claim that the trial court’s determination of value was not independent because the court adopted in toto the appraisal of one expert witness. However, the cases cited by the landowners do not support this contention. These cases hold merely that:

“ * * * The trier of fact is not required to accept or to reject the testimony of each witness in toto. * * * ” (State, Department of Highways v. Salassi, 244 So.2d 871, 877 [La.App. 1st Cir. 1971] — Emphasis supplied)

See, also, State, Department of Highways v. William T. Burton Industries, Inc., 219 So.2d 837 (La.App. 3rd Cir. 1969). The rule cited is a far cry from holding that a trial judge may not accept in toto the testimony of one of the expert witnesses in an expropriation hearing.

Finally, the landowners contend that the trial court erred in using its personal opinion to determine the market value of the expropriated property. To support this contention, the landowners point to an excerpt from the written reasons of the trial court, which states:

“ * * * The Court is confident that with few exceptions, there is very little property outside the city limits of Baton Rouge worth in excess of $16,000.00 per acre.”

It is well settled that in expropriation proceedings judicial notice may be taken only of facts within the common knowledge of every person of ordinary understanding and not of facts merely within the judge’s personal knowledge. State, Department of Highways v. Thurman, 231 So.2d 692 (La.App. 1st Cir. 1970). In the case in point, however, it is clear that the trial judge based his decision, not upon his personal knowledge, but upon the evidence presented at trial as carefully reviewed and analyzed in his written reasons for judgment.

In expropriation proceedings the trial court’s factual findings as to value and severance damages should not be disturbed on appeal in the absence of manifest error, because the trial judge is in a better position to determine the credibility and the weight to be accorded the testimony of differing experts. State, Department of Highways v. Wax, 295 So.2d 833 (La.App. 1st Cir. 1974); State, Department of Highways v. William T. Burton Industries, Inc., supra; State, Department of Highways v. Salassi, supra.

We find that the determination by the trial court of just and adequate compensation due the landowners is amply supported by the record and not manifestly erroneous. Therefore, the decision of the trial court is affirmed, at the appellants’ cost.

AFFIRMED.


author: ROBERTSON, Justice,

text:
    PENNSYLVANIA LIFE INSURANCE COMPANY v. Joseph S. HOWELL.
    No. 49370.
    Supreme Court of Mississippi.
    May 18, 1977.
    Satterfield, Allred & Colbert, Michael S. Allred, Jackson, for appellant.
    Tullos & Tullos, Eugene C. Tullos, Raleigh, for appellee.
    Before GILLESPIE, ROBERTSON and LEE, JJ.
   ROBERTSON, Justice,

for the Court:

Joseph S. Howell on March 14, 1975, filed suit against Pennsylvania Life Insurance Company in the Circuit Court of Smith County, Mississippi. In his declaration, Howell alleged that on May 14, 1973, Pennsylvania Life issued to him an insurance policy providing, among other things, for the payment of $400 monthly if the insured became totally and permanently disabled as a result of sickness.

Howell further alleged that on February 21, 1974, he became totally and permanently disabled, and demanded payment of $400 per month beginning February 21, 1974. Penn Life answered, denying the allegations of the declaration and asserting that under Parts Ten and Eleven of the policy that Howell had not been continuously disabled, “so as to require continuous confinement indoors within the said policy terms.”

The case was tried on November 7, 1975, and the jury returned a verdict for Howell for $8400 (21 months at $400 per month), even though the period from February 21, 1974, to November 7, 1975, was only 2OV2 months. Penn Life appeals.

Howell was a poultry farmer, and while working in one of his chicken houses on February 21, 1974, suffered three blackout spells. He also experienced chest pains. His wife drove him to the Smith County General Hospital in Raleigh, where he was examined by Dr. John K. Wilson, a general practitioner. Howell stayed in the hospital from Thursday until Saturday afternoon when he was released to go home. He returned to see Dr. Wilson the Monday after his release and numerous times thereafter until May, 1974.

On May 14, 1974, Dr. Wilson referred Howell to Dr. William Rosenblatt, a cardiovascular specialist with the Jackson Heart Clinic. Dr. Rosenblatt placed Howell in St. Dominic Hospital in Jackson, and made extensive tests. He was in St. Dominic’s from Wednesday until the following Monday. Thereafter Howell saw Dr. Rosenblatt each month through March of 1975.

Dr. Rosenblatt testified by deposition that Howell suffered from essential hypertension, that he stabilized Howell’s blood pressure within normal limits by prescribing Hygroton, a diuretic, and Enderal, a preparation which slows down the heart rate. Dr. Rosenblatt was of the opinion that Howell was not totally disabled and that he could function as a poultry farmer in a supervisory capacity. Dr. Rosenblatt testified:

“The only restrictions that I would place on him would be that he not engage in any strenuous exertion such as heavy lifting and straining and climbing.”

Howell began to go to Dr. Henry E. Irby, a general practitioner in Mize, and saw him from March, 1975, through July, 1975. Dr. Irby found that his blood pressure had become elevated and prescribed stronger medication which stabilized his blood pressure within normal limits. Dr. Irby testified that Howell was totally and permanently disabled, would probably have to take medicines the rest of his life, and would have to see a doctor at regular intervals. Howell had not seen a physician for his high blood pressure from July 1975 until the time of trial in November, 1975.

Howell based his claim for benefits on this provision of the policy:

“PART TEN CONFINING TOTAL DISABILITY BENEFITS FOR LIFE-SICKNESS
“If sickness causes continuous total disability, requires continuous confinement within doors and requires the regular and personal attendance of a physician, commencing while the policy is in force and continues uninterrupted until the expiration of the elimination period stated in the Policy Schedule, if any, the Company will pay periodically the Monthly Benefit stated in the Policy Schedule for each month (Vso of such Monthly Benefit for each day of any period less than a full month) during which such total disability continues so long as the Insured lives and is so disabled and confined.
“Confinement shall not be considered terminated by reason of transportation of the Insured, at the direction of his physician, to or from a hospital or a doctor’s office for necessary treatment.” (Emphasis added).

Penn Life contends on appeal that Howell was not totally and permanently disabled under the terms of the policy and that even if he were that he was not continuously confined within doors, and that Part Eleven of the policy applied when the insured was not confined continuously within doors. Part Eleven provides:

“PART ELEVEN TOTAL DISABILITY BENEFITS FOR NON-CONFINING SICKNESS TWELVE MONTHS “If sickness causes continuous total disability but does not require continuous confinement within doors and requires the regular and personal attendance of a physician, commencing while this policy is in force and continues uninterrupted until the expiration of the elimination period stated in the Policy Schedule, if any, or immediately following a period of total disability for which benefits were payable under Part Ten, the Company will pay periodically the Monthly Benefit stated in the Policy Schedule for each month (V&o of such Monthly Benefit for each day of any period less than a full month) during which such total disability continues, but not to exceed twelve months for any one period of sickness.” (Emphasis added). Total Disability is defined in the policy:
“TOTAL DISABILITY whenever used in this policy, means that as a result of injury or sickness, the Insured is under the regular and personal attendance of a physician, other than himself, is unable to perform each and every duty pertaining to his occupation or profession, and is not gainfully employed in any other occupation or profession; after the Monthly Benefit for such Total Disability has been paid for twenty-four months, then thereafter during the remainder of such disability, subject to the limits of Part Four or Part Ten, Total Disability means the complete inability of the Insured to engage in any and every occupation or profession for which he is reasonably fitted by reason of education, training or experience.”

On cross-examination, Howell testified that he was not confined within doors, that he drove to Mize frequently to get the mail, would sit around Mrs. Windham’s service station and discuss politics, would frequently go over to the Hamburger House and drink coffee, that he would visit his nephew who was in the parts business in Mize, and that he would visit his friends and business establishments in Mize.

Dr. Irby testified that Howell was not confined to his home, that it would be good for him to get out and take as much exercise as he felt he could, and that the only limitation on Howell’s activities other than strenuous physical exertion was his (Howell’s) “extreme anxiety about his condition . which has within itself limitations . on any human being.”

We are of the opinion that Parts Ten and Eleven of the policy are in clear and unambiguous terms, and that as a matter of law Part Ten, which was the basis of recovery, is not applicable because there was no testimony that Howell’s sickness “requires continuous confinement within doors”.

We are of the further opinion that the jury was justified in finding from the evidence adduced that Howell was totally and permanently disabled, but that Part Eleven of the policy would be applicable, and that the payment of the monthly benefit would be limited to “twelve months for any one period of sickness.”

The judgment, therefore, should be for the recovery of $4800, rather than $8400, and judgment is entered here for that amount.

AFFIRMED AS MODIFIED.

GILLESPIE, C. J., PATTERSON, and INZER, P. JJ., and SMITH, SUGG, WALKER, BROOM and LEE, JJ., concur.


author: GILLESPIE, Chief Justice,

text:
    Ronnie P. COOK and Walter J. Cook v. CITIZENS SAVINGS & LOAN ASSOCIATION and Taylor Lumber Company, Inc.
    No. 49169.
    Supreme Court of Mississippi.
    May 25, 1977.

      Corr & Carlson, George C. Carlson, Jr., Sardis, for appellants.
    Ted Lucas Smith, Robert H. Broome, Batesville, for appellees.
    Before GILLESPIE, C. J., and SMITH and WALKER, JJ.
   GILLESPIE, Chief Justice,

for the Court:

ON PETITION FOR REHEARING

The petition for rehearing is sustained and the previous opinion of this Court is withdrawn and the following substituted as the opinion of the Court.

Suit was filed in the Chancery Court of Panola County by Ronnie P. and Walter J. Cook, d/b/a C. & C. Erectors (hereinafter Complainants), against William A. and Raymond Dudley Clark (hereinafter Clark), Citizens Savings & Loan Association (hereinafter Citizens), and Taylor Lumber Company, Inc. (hereinafter Taylor). After complainants rested their case the trial court sustained a motion to exclude the evidence and dismissed the case.

Complainants entered into a contract with Clark to furnish labor and materials in the construction of a pre-engineered steel building on his lot for the sum of $8,800. For the purpose of financing the construction on the lot where the building was to be located, Clark executed a deed of trust on the real estate in favor of J. H. Hogan, Trustee for Citizens. This deed of trust was duly placed of record in the chancery clerk’s office. After Complainants completed the construction of the building, they requested J. H. Hogan, Vice President and Executive Officer of Citizens, for payment pursuant to the contract. Hogan, as Citizens’ agent, issued a check payable to Clark and Complainants for $5,000 as partial payment on the contract price. Citizens also paid to Clark one payment of $4,000 and another of $4,500. At the time these two payments, totaling $8,500, were made to Clark, Hogan did not obtain from Clark any accounting as to what use was to be made of this money, nor is there anything in the record to indicate that anyone on behalf of Citizens made any inquiry of Clark as to whether the labor and materials has been paid, although Citizens made the loan for the specific purpose of paying for the construction of the building. No further payments were made by anyone to Complainants and at the time of trial there was a balance due under the construction contract of $4,240, plus interest from September 10, 1973, the completion date of the contract, at the statutory rate of six percent.

Thereafter, J. H. Hogan, as Trustee for Citizens, foreclosed the deed of trust. Taylor bought the property for $23,272.78, which was paid in cash to the Trustee. At the time of the foreclosure sale and purchase by Taylor of the subject property, both Citizens and Taylor knew that Complainants had not been paid for the labor and materials used in the construction of the building on the property in question. Complainants’ contract with Clark was not placed of record until after the foreclosure.

Complainants contend that they are entitled to judgment against Citizens because it paid out the construction loan proceeds without using reasonable care to see that the money went to discharge the liens for labor and material, and against Taylor because it purchased the property under the foreclosure deed of trust with knowledge of Complainants’ lien.

Did the failure of Citizens to use reasonable diligence to see that the proceeds of the construction loan were used to pay for materials or other costs of construction render it liable to Complainants?

On motion to exclude all testimony favorable to complainant is taken as true. We state the facts in this light. Citizens made a construction loan. It paid out $8,500 of this money direct to Raymond Dudley Clark without taking any precautions to see that he applied the money to discharge liens for labor and materials, of which Citizens had actual knowledge. As a lender paying out construction funds, Citizens should have used reasonable diligence to see that the funds were actually used in payment of materials or other costs of construction. Southern Life Insurance Co. v. Pollard Appliance Co., 247 Miss. 211, 150 So.2d 416 (1963). Citizens totally failed to discharge its duty in disbursing the loan proceeds. It caused the deed of trust to be foreclosed, and now holds the funds realized from the foreclosure sale, funds to which Complainants’ lien attaches. Complainants’ evidence showed that Citizens is liable to Complainants in the sum of $4,240.

The trial court dismissed the bill of complaint on a motion to exclude the evidence and Citizens has not had an opportunity to present its defense. Therefore, the judgment of the trial court is reversed for the reasons above stated and the cause is remanded for a full hearing on the merits.

REVERSED AND REMANDED.

PATTERSON and INZER, P. JJ., and SMITH, ROBERTSON, SUGG, WALKER, BROOM and LEE, JJ., concur.


text:
    Roosevelt GARRETT v. STATE of Mississippi.
    No. 50012.
    Supreme Court of Mississippi.
    May 25, 1977.
    Hugh L. Bailey, Winona, for appellant.
    A. F. Summer, Atty. Gen. by Wayne Snuggs, Special Asst. Atty. Gen., Jackson, for appellee.
    Before PATTERSON, P. J., and WALKER and BROOM, JJ.
   Appeal from Circuit Court, Montgomery County; Clarence E. Morgan, Jr., Judge.

AFFIRMED.

GILLESPIE, C. J., INZER, P. J., and SMITH, ROBERTSON, SUGG and LEE, JJ., concurring.


text:
    Billie Jane Burnett WALTERS v. ESTATE of Mattie Lee BURNETT, Deceased and/or Martha B. Stuart and Mrs. Sandra Norman.
    No. 49420.
    Supreme Court of Mississippi.
    May 25, 1977.
    Albert Sidney Johnston, Jr., Arnaud O. Lopez, Biloxi, for appellant.
    Thomas J. Wiltz, Wadlington & Corban, L. C. Corban, Jr., Biloxi, for appellee.
    Before INZER, P. J., and SMITH and BROOM, JJ.
   Appeal from Chancery Court, Harrison County; Frank W. Alexander, Chancellor.

AFFIRMED.

GILLESPIE, C. J., PATTERSON, P. J., and ROBERTSON, SUGG, WALKER and LEE, JJ., concurring.


text:
    Robert E. WATKINS v. STATE of Mississippi.
    No. 49710.
    Supreme Court of Mississippi.
    May 25, 1977.
    Richard B. Brown, Jr., Gulfport, for appellant.
    A. P. Summer, Atty. Gen. by Henry T. Wingate, Special Asst. Atty. Gen., Jackson, for appellee.
    Before INZER, P. J., and SMITH and BROOM, JJ., and JOSEPH C. FEDUCCIA, Commissioner.
   Appeal from Circuit Court, Harrison County; J. Ruble Griffin, Judge.

AFFIRMED.