author: LANDRY, Judge.

text:
    Charles Congreve CARTER, III v. Gaston J. BORDELON, Jr., et al. Charles Congreve CARTER, Jr. and Marilyn B. Carter v. Gaston J. BORDELON, Jr., et al.
    Nos. 12448, 12449.
    Court of Appeal of Louisiana, First Circuit.
    March 5, 1979.

      Henry A. Mentz, Jr. and Rodney C. Cashe, Hammond, for Charles Congreve Carter, III.
    Phillip Gattuso, Gretna, for Gaston J. Bordelon, Jr.
    Daniel Atkinson, Baton Rouge, for United States Fidelity and Guaranty Co.
    Horace C. Lane, Baton Rouge, for United States Fidelity and Guaranty Co. and Bor-delon.
    Tom H. Matheny and Pittman & Mathe-ny, Hammond, for Louisiana Health Service & Indemnity (appellant-intervenor).
    Before LANDRY, CHIASSON and SAR-TAIN, JJ.
   LANDRY, Judge.

Intervenor-Appellant Louisiana Health Service and Indemnity Company (also known as, and hereinafter referred to as, Blue Cross), medical and hospital insurer of Charles Congreve Carter III (now deceased), appeals from judgment subordinating Blue Cross’ subrogation rights to funds paid decedent’s estate and surviving parents by the insurer of defendant tort-feasor Bordelon and by decedent’s uninsured motorist insurer, for personal injuries sustained in an automobile accident and resulting in decedent’s death. We affirm.

On October 19, 1977, Charles Carter III sustained severe personal injuries in an automobile accident caused by the negligence of defendant Bordelon. The mishap occurred while Bordelon was driving a truck owned by defendant Bordelon Homes & Lumber Company, Inc. On November 9, 1977, suit was instituted on behalf of Charles Carter III to recover for personal injuries, medical expense, and lost earnings. United States Fidelity and Guaranty Company (U.S.F.&G.) was made defendant in the action as liability insurer of the Borde-lon vehicle and as uninsured motorist insurer of plaintiff’s automobile.

Charles Carter III died on January 15, 1978, of injuries sustained in the accident. His parents, Charles Carter, Jr. and Marilyn B. Carter, were substituted as plaintiffs in decedent’s survival action and, in addition, instituted a separate action for wrongful death damages. Both actions were consolidated for trial.

Pursuant to its hospital, surgical, and medical insurance policy issued to decedent, Blue Cross paid decedent’s succession $107,-577.80 for medical expense incurred by decedent prior to his demise. Contemporaneously with the payment, Blue Cross obtained from Charles Carter, Jr. a subrogation agreement which pertinently provides:

“ . . . and for the consideration aforesaid and to the extent of said payment the undersigned further subrogates to said company all rights which the undersigned may have against any person or persons arising out of the loss mentioned above, and for the enforcement of such rights said insurer is hereby authorized to take any action which may be necessary either in law or in equity in its own name or that of the undersigned

Also germane is the following provision of Blue Cross’ policy:

“F. In the event of any payment under this Contract, the Plan will be sub-rogated to all the Member’s rights of recovery to the extent of such payment against any person or other legal entity. The Member will execute and deliver instruments and papers and do whatever else is necessary to secure such rights. The Member shall do nothing after loss to prejudice such rights.”

Blue Cross intervened in plaintiffs’ consolidated actions seeking enforcement of its subrogation rights to the extent of the $107,577.80 paid for medical expenses incurred by decedent.

Prior to trial on the merits of plaintiffs’ consolidated actions, a settlement was reached pursuant to which all defendants were released from liability subject to certain stated conditions.

The settlement agreement, evidence by a written stipulation of record and incorporated into the judgment below, specifies as follows:

“1. Gaston J. Bordelon and Bordelon Homes and Lumber Company agreed to pay the total sum of $15,000.00, which payment was to be applied directly to plaintiffs in both the survival action and wrongful death suit, and Blue Cross Insurance Company specifically waived any rights to this payment.
2. $10,000.00 under the USF&G liability policy issued to Gaston J. Bordelon and Bordelon Homes and Lumber Company was paid and deposited into the registry of the Court.
3. $200,000.00 in U/M benefits under the USF&G policy issued to plaintiff, Charles C. Carter, Jr., was paid and appropriated as follows:
a. $97,000 to be paid in the registry of the Court.
b. $103,000.00 paid directly to plaintiffs in both the survival action and wrongful death action.
4. The pain and suffering of Charles C. Carter, III, in the survival suit was stipulated to be in excess of $300,000.00.
5. The pain and suffering of the plaintiffs in the wrongful death suit, for the loss of love and affection of their son, was stipulated to be the sum of $100,-000.00 or $50,000.00 to each surviving parent.
6. The value of medical expenses incurred was stipulated to be in the sum of $137,154.74.
7. Blue Cross Insurance Company waived any subrogation rights to any amount paid under its policy in excess of $107,577.80.
8. Loss [of] wages incurred by Charles C. Carter, III, was stipulated at the sum of $2,700.00.
9. The court was to decide upon the appropriation of the sum of $107,000.00 deposited into escrow, in whole or in part to plaintiffs in the survival action and wrongful death action or Blue Cross Insurance Company under its petition for intervention.”

As indicated by the above stipulation, the sole question is the proper allocation of the $107,000.00 deposit consisting of $10,000.00 deposited by U.S.F.& G. as liability insurer of the tort-feasor, Bordelon, and his employer, and $97,000.00 paid by U.S.F.& G. as plaintiffs’ uninsured motorist insurer. The trial court held that plaintiffs in the survival and wrongful death actions were entitled to be paid the entire deposit by preference. In so holding the trial court was influenced principally by the stipulation fixing the value of decedent’s pain and suffering prior to his death at $300,000.00 and establishing the value of the survivors’ loss of love and affection at a total of $100,000.00. The trial court reasoned there was no dual recovery of medical expenses because the combined general damages due in the consolidated actions exceeded $400,000.00 whereas plaintiffs’ total recovery from all defendants aggregated only $225,000.00. Relying on Legendre v. Rodrigue, 358 So.2d 665 (La.App. 1st Cir. 1978), the trial court held plaintiffs’ total general damages due in the survival action payable by preference over Blue Cross’ right to reimbursement or subrogation. The trial court reasoned further that Blue Cross was not entitled to subrogation rights as to any of the damages allocated to the wrongful death action because no medical payments were made directly to plaintiffs therein. While we disagree with this latter reasoning of the trial court, for reasons hereinafter set forth, we affirm its judgment.

Blue Cross contends the lower court erred in: (1) failing to recognize that an insurer, who pays medical benefits to its insured pursuant to a medical care policy, is entitled to reimbursement from funds collected from a tort-feasor; and, (2) failing to recognize that a medical payment insurer granted a conventional subrogation by its insured, is entitled to preferential recovery from the insured or tort-feasor.

In support of its claim for reimbursement from Appellees out of funds provided by the tort-feasor, Blue Cross relies upon Harris v. Huval Baking Company, 265 So.2d 783 (La.App. 3d Cir. 1972); Liberty Mutual Insurance Company v. Weinberger, 329 So.2d 254 (La.App. 4th Cir. 1976). We note, however, that the bulk of the funds in this case were not derived from or contributed by the tort-feasor but from plaintiffs’ uninsured motorist insurer who contributed $97,000.00 of the $107,000.00 involved.

In Harris v. Huval Baking Company, supra, the insurance contract provided medical, hospital, and surgical benefits for employees of a railroad. Plaintiff therein, a railroad employee, recovered medical benefits from the insurer for injuries sustained in an automobile accident. Plaintiff sued the third party tort-feasor and the insurer intervened seeking preferential reimbursement out of any amounts recovered from the tort-feasor. Based on the insurer’s bylaws, the court found that the agreement contemplated that medical payments, in the event of injury caused by a third party, were to be paid only until such time as recovery could he had against the third party, at which time the insurer would be repaid. No similar provision is involved herein and there is thus no basis for the claim that reimbursement is due from plaintiffs.

Liberty Mutual Insurance Company v. Weinberger, supra, involved a defendant who was a guest passenger who received medical expenses as an occupant of his host’s vehicle which was involved in a two-car collision. The host’s policy provided for reimbursement to the insurer out of any recovery from a third person legally liable for the injury giving rise to medical payment. Defendant refused to make reimbursement contending that such a reimbursement would contravene public policy. In rejecting this argument, the court stressed the public advantage in the form of reduced premiums in consideration of the agreement to reimburse the insurer out of recovery from a third party tort-feasor. The Blue Cross policy, however, does not purport to require reimbursement as such from the insured. Moreover, we are not here concerned with reimbursement by the insured but rather with subrogation of the insured’s right of recovery.

Appellant’s claim to subrogation is based primarily on Brown v. Zito, 333 So.2d 649 (La.App. 4th Cir. 1976) and Hartford Accident & Indemnity Company v. Byles, 280 So.2d 624 (La.App. 3d Cir. 1973), which allegedly hold that an insurer having a conventional subrogation from its insured is entitled to preferential recovery from the insured or tort-feasor to the extent of medical payments made to the insured. We note, however, that the issue in Byles, supra, as stated therein by the court was “whether Hartford is legally subrogated to the claim of its insured against defendant Byles.” The issue here is conventional sub-rogation whereas the issue in Byles was whether there was in fact a legal subrogation. In Brown v. Zito, supra, the issue was one of proof, namely, whether the insurer’s alleged subrogation claim could be recognized at all considering the record contained no evidence of a policy or cancelled drafts or other evidence of a conventional subro-gation.

In support of its claim of preferential payment, Appellees rely upon Legendre v. Rodrique, supra, and La.C.C. Article 2162. In Legendre v. Rodrique, plaintiffs, who sustained personal injuries in an automobile accident caused by the negligence of a third party tort-feasor, were paid $9,174.90 under the collision and medical pay provisions of their own liability insurance coverage by State Farm Mutual Automobile Insurance Company. The insurer, State Farm, intervened in plaintiffs’ action against the third party tort-feasor seeking subrogation recovery from any amounts obtained by plaintiffs. Subrogation was sought by State Farm by virtue of subrogation clauses contained in both the collision and medical pay clauses of the policy, which provisions were as follows:

“ ‘ * * * [T]he company shall be subrogated to the extent of such payment to the proceeds of any settlement or judgment that may result from the exercise of any rights of recovery which the injured person or anyone receiving such payment may have against any person or organization and such person shall execute and deliver instruments and papers and do whatever else is necessary to secure such rights. * * *

In addition, the plaintiff in Legendre, supra, executed a “Subrogation Receipt” which pertinently provided:

“ ‘ * * * [F]or the consideration aforesaid [collision and medical payments] and to the extent of said payment the undersigned further subrogates to said company all rights which the undersigned may have against any person or persons arising out of the loss mentioned above, and for the enforcement of such rights said insurer is hereby authorized to take any action which may be necessary either in law or in equity in its own name or that of the undersigned * * *

The issue in Legendre, supra, was whether the injured plaintiffs or their insurer State Farm were preferred as to the proceeds of a $160,779.14 judgment obtained by plaintiffs against the third party tort-feasor and his insurer. In Legendre, we recognized State Farm’s subrogation rights and rendered judgment in favor of State Farm against the tort-feasor and his insurer. We also held, however, that the subrogation in favor of State Farm was a partial subrogation pursuant to La.C.C. Article 2162, which provides:

“The subrogation established by the preceding articles, takes place as well against the sureties, as against the debtors. It can not injure the creditor, since, if he has been paid but in part, he may exercise his right for what remains due, in preference to him from whom he has received only a partial payment.”

Applying Article 2162, above, in Legendre, supra, we held State Farm’s subrogation rights were subordinate to the rights of plaintiffs against the tort-feasor involved. In Legendre, we found the subrogation partial because although plaintiffs subrogated their claims for collision damage and medical payments, plaintiffs had not subrogated their claims for personal injuries.

We see no factual distinction between the instant case and Legendre, supra, and hold the cited authority to be dispositive of the case at hand. As in Legendre, plaintiffs here are seeking more than medical payments by plaintiffs’ insurer. Plaintiffs are asking for damages for pain and suffering of decedent (which is stipulated to be far in excess of the amount claimed by subrogation herein), loss of wages, funeral expenses, and loss of love and affection. Applying Legendre, we hold that Blue Cross’ subrogation being only partial, plaintiffs are entitled to recover the amount due them under the judgment in preference to Appellant’s subrogation claim.

We find no substance in Appellant’s attempt to distinguish Legendre, supra, on the ground that the language of the subro-gation instruments involved therein indicated intent to effect only a partial subro-gation. Upon reconsideration of the instruments in Legendre, we note that the policy at issue therein purported to subrogate to the insurer “any rights of recovery” belonging to the insured, and, in addition, the insurer was subrogated, by virtue of the subrogation receipt, to “all rights” which the insured might have arising out of the loss. The instruments clearly attempted to effect a total subrogation, contrary to Appellant’s contention.

The judgment is affirmed at Appellant’s cost.

AFFIRMED.

      . Although the facts in the record establish that medical expenses aggregating $107,577.80 were paid by Blue Cross to decedent’s succession, to which amount Blue Cross was subrogated, the amount in dispute herein is limited to that portion of the settlement proceeds deposited in the registry of the lower court by stipulation of all parties, namely, $107,000.00.


source: Caselaw Access Project

author: CHIASSON, Judge.

license: Public Domain

text:
    Lee Allen HAYNES, D/B/A Lee Allen’s Fashions For Men v. STANDARD FIRE INSURANCE COMPANY.
    No. 12470.
    Court of Appeal of Louisiana, First Circuit.
    March 5, 1979.

      C. Kaywald Stafford and George M. Pier-son, Baton Rouge, for plaintiff-appellant Lee Allen Haynes D/B/A Lee Allen’s Fashions For Men.
    Paul Marks, Jr., Baton Rouge, for defendant-appellee Standard Fire Ins. Co.
    Dan E. West, Baton Rouge, for interve-nor-appellee Genesco, Inc.
    Peter T. Dazzio, Baton Rouge, for inter-venor-appellee Finleigh Clothes & Congress Fact Corp.
    Before ELLIS, CHIASSON and SAR-TAIN, JJ.
   CHIASSON, Judge.

On October 13, 1976, a fire occurred at Lee Allen’s Fashions for Men, located on Florida Boulevard in Baton Rouge, Louisiana. Plaintiff-appellant, Lee Allen Haynes d/b/a Lee Allen’s Fashions for Men (Haynes), had a multi-peril insurance policy covering his store. The policy provided personal property coverage in the primary amount of $85,000.00 with a peak season endorsement in the amount of $15,000.00 and a gross earnings coverage in the amount of $60,000.00. On October 29,1976, the appellant filed a proof of loss with the appellee. On December 20, 1976, appellant made demand for payment from the appel-lee. On December 29, 1976, appellant filed suit for breach of contract, seeking the full amount of coverage provided by the policy and statutory penalties, interest and attorney’s fees as provided in La.R.S. 22:658. On December 30, 1976, after suit was filed, the insurance company offered an advance to the appellant of $25,000.00, which appellant refused. On November 9, 1977, the appellee deposited $107,000.00 in the registry of the court. By order dated December 16, 1977, the money deposited in the court; registry was disbursed to the appellant’s creditors. Trial on the matter was held on February 8, 9 and 10, 1978. On February 28, 1978, judgment was rendered awarding appellant penalty, interest and attorney’s fees from August 1, 1977.

The appellant lists the following specifications of error:

1. The trial court erred in not finding that the $25,000.00 tender by the insurer to the insured was a conditional tender and not awarding penalty, interest and attorney’s fees thereon.
2. The trial court erred in not awarding penalty, interest and attorney’s fees on the insurer’s “admitted liability” of $107,-000.00.
3. The trial court erred in not allowing interest from the date of judicial demand.
4. The trial court erred in limiting the attorney’s fees to $5,000.00.
5. The trial court erred in not allowing the insured to recover under the gross earnings coverage of the subject policy.

The first four specifications of error relate directly or indirectly to the award and computation of the penalties, interest and attorney’s fees awarded under La.R.S. 22:658. The second and fifth specification of error deal with the total amount of loss the appellant is entitled to. In order to compute the penalty, we must first determine the total amount of loss. Therefore, we will first address the second and fifth specification of error.

As to the second and fifth specification of error, appellant argued that at the minimum the penalty provided for in La.R.S. 22:658 should be computed on $107,000.00 since the insurer admitted this amount of obligation or liability under the policy provisions in its motion to deposit the funds in the court registry and in the pretrial order. Appellant also argued that he is entitled to the full amount of the policy benefits under the gross earnings coverage provided in the subject policy.

The insurance policy provided personal property coverage in the amount of $85,-000.00, with a peak season endorsement thereon in the amount of $15,000.00, and also provided for gross earnings coverage in the amount of $60,000.00. The insurer had deposited $107,000.00 in the registry of the court, which breaks down as follows:

$ 85,000.00 personal property coverage
15,000.00 peak season endorsement coverage
7.000.00 gross earnings endorsement coverage
$107,000.00 total amount deposited in the court registry.

Appellant argued he is entitled to the full coverage provided by the policy. We disagree. We find that appellant has received the proper amount of loss. As to any further amounts that might be obtained under the gross earnings endorsement coverage, we agree with the trial court’s findings and conclusions as to this issue, as follows:

“. . . Under the gross earnings endorsement of the policy, the defendant never received satisfactory proof of loss, so far as these earnings are concerned, and the plaintiff has failed to establish by a preponderance of evidence that he suffered any loss that would not be adequately covered by the seven thousand dollars that has already been paid by the insurance company to him.”

We have reviewed the record and find there is a reasonable factual basis for the finding of the trial court and that the record establishes that this finding is not clearly wrong.

We find that the total amount of loss owed to appellant was $107,000.00 under the subject policy. We will discuss the computation of interest hereinafter. This disposes of appellant’s second and fifth specification of error.

Having determined the total amount of loss due to appellant, the remaining specifications relating to penalty, interest and attorney’s fees can now be addressed.

As to specification of error number one, La.R.S. 22:658 provides as follows:

“All insurers issuing any type of contract other than those specified in R.S. 22:656 and 22:657 shall pay the amount of any claim due any insured including any employee under Chapter 10 of Title 23 of the Revised Statutes of 1950 within sixty days after receipt of satisfactory proofs of loss from the insured, employee or any party in interest. Failure to make such payment within sixty days after receipt of such proofs and demand therefor, when such failure is found to be arbitrary, capricious, or without probable cause, shall subject the insurer to a penalty, in addition to the amount of the loss, of 12% damages on the total amount of the loss, payable to the insured, or to any of said employees, together with all reasonable attorney’s fees for the prosecution and collection of such loss, or in the event a partial payment or tender has been made, 12% of the difference between the amount paid or tendered and the amount found to be due and all reasonable attorney’s fees for the prosecution and collection of such amount. Provided, that all losses on policies covering automobiles, trucks, motor propelled vehicles and other property against fire and theft, the amount of the penalty in each of the above cases shall be 25% and all reasonable attorney’s fees.” (Emphasis supplied)

On December 30, 1976, the appellee by letter sent a draft in the amount of $25,000.00 to appellant’s attorney. The draft was made payable to the order of the following:

Lee Allen’s Fashions for Men
George M. Pierson (attorney for the
appellant)
Capital Bank & Trust Co.
Genesco, Inc.
Fin Leigh Clothes

Appellant admits that Capital Bank and Genesco had perfected their claim under La.R.S. 9:4581 and La.R.S. 9:4582 and therefore had an interest in the draft. However, appellant argued that no showing or evidence was introduced demonstrating that Fin Leigh Clothes had, prior to the tendering of the check, complied with the provisions of the cited statutes.

The record reveals that this payment was tendered after suit was filed and appellant’s allegations about Fin Leigh Clothes are correct. There was no showing or evidence introduced demonstrating a basis on which the check was also made payable to Fin Leigh Clothes. There is no evidence as to compliance by Fin Leigh Clothes with the provisions of La.R.S. 9:4581-4582. Additionally, John Pritchett, the insurer’s senior claims representative and the author of the letter which contained the draft, could not explain why the check named Fin Leigh Clothes as a payee, other than the fact that he believed they were a creditor of the appellant.

We believe that the tender made to appellant was not an absolute and unconditional tender by virtue of the fact that a named payee on the draft was not shown to have an interest in the draft. Therefore, we find that appellee made the draft conditional and appellant is under no obligation to accept such a tender. For these reasons, we reverse the trial court’s finding that the insurer is not subject to a penalty on the $25,000.00. We find that under La.R.S. 22:658 that the penalty of 12% is to be computed on the total amount of loss.

As to specification of error number four, we find that the amount awarded as attorney’s fees to be adequate and find no abuse of the trial court’s discretion in making this award. We do however feel that the preparation and argument of this case on appeal required additional time and labor for which appellant’s attorney was evidently not compensated in the lower court judgment. We will allow an additional $1,500.00 in attorney’s fees. Witherwax v. Zurich Insurance Company, 315 So.2d 420 (La.App. 3rd Cir. 1975).

As to specification of error number three, the trial court made the following award:

“I. There be judgment rendered herein in favor of the plaintiff, Lee Allen Haynes, d/b/a Lee Allen’s Fashions for Men, and against the defendant, Standard Fire Insurance Company, for penalty, interest and attorney fees, pursuant to LSA-R.S. 22:658, from August 1, 1977, in the amount of $9,000.00 for penalty and interest and $5,000.00 for attorney fees, until paid, and for all costs of these proceedings;”

In oral reasons for judgment the trial court found that sometime in July of 1977 the insurer had enough information to determine an amount of money owed to appellant under the policy; the insurers should have submitted a tender to appellant within sixty days of this determination; and the insurer did not submit a figure for appellant to consider until six months later, January of 1978. On this basis the trial court found the appellee to have been arbitrary and capricious as provided in La.R.S. 22:658 and provided that interest on the amounts awarded was to run from August 1, 1977, until paid.

Appellant argued that he is entitled to interest from the date of judicial demand. Appellant also argued that two errors were made in the trial judge’s oral reasons for judgment: the first, being May of 1977 instead of July of 1977 as the date the insurer had the information needed to determine the amount due under the policy; the second, tender was finally made to appellant in November of 1977 by depositing in the registry of the court $107,000.00 and not a tender made in January of 1978.

Appellee argued that the trial court awarded penalties from the time it felt the insurer had sufficient information up to the time that the $107,000.00 was deposited into the registry of the court.

Since the trial court’s judgment is unclear as to certain portions of this issue, we will take this specification of error in steps.

First, we find that the trial court was correct in its finding that after the sixty days from the proof of loss submitted, the insurance company was justified, initially, in not paying the appellant. We find the following facts to support this conclusion: the ongoing arson investigation and the documentation provided by appellant with his proof of loss, particularly in regard to the gross earnings coverage. However, after a point, the appellee was arbitrary and capricious in refusing to offer payment to the appellant.

Secondly, we find two errors involving dates in the trial court’s oral reasons for judgment. We find that these errors were made by mistake or typographical error. The trial court found that as of July of 1977 the insurance company had all of the information it could obtain to determine the amount of loss and therefore by August of 1977, the insurer should have made some attempt at submitting an amount for appellant’s consideration. The record reveals that by the end of May of 1977, the insurance company had all of the information necessary for the proof of loss. Therefore, the sixty days as specified in La.R.S. 22:658 would have run by the end of July. We find that as of August 1,1977, the appellee was arbitrary and capricious in not paying the claim and that interest on the amounts awarded should commence as of August 1, 1977. Additionally, the trial court found that the insurer tendered payment in January of 1978. From the record, we find that by motion dated November 7, 1977, signed by the trial court, the insurer deposited $107,000.00 into the registry of the court.

Having made these corrections, we will commence the running of interest due from August 1, 1977.

Thirdly, we cannot determine from the trial court’s judgment (1) on what amount he calculated the penalty, and (2) what he meant by awarding $9,000.00 for penalty and interest. Since we have all of the facts before us to determine the proper award, we will do so:

1. $107,000.00 is the amount of loss on which the 12% penalty should be calculated [the penalty being $12,840.00].
2. Appellant owes legal interest on the total of the following amounts from August 1, 1977, through November 7, 1977:
$107,000.00 - total amount of loss
12,840.00 - 12% penalty
5.000.00 - attorney’s fees
$124,840.00

We stop the legal interest running on the figure of $124,840.00 on November 7, 1977 since by depositing the money in the registry of the court, the appellee has made it available to the appellant.

3. Beginning with November 8, 1977, and continuing until it is paid, legal interest is owed on the total of the following amounts:

$12,840.00 - 12% penalty
5.000.00 - attorney’s fees
$17,840.00

4. Interest on our award of $1,500.00 attorney’s fees, begins to run as of the date of this decision.

5. The trial court’s award of court costs is affirmed.

As specified above, the judgment of the trial court is affirmed in part, reversed in part, and amended in part. Costs of this appeal are to be paid by the appellee.

AFFIRMED IN PART, REVERSED IN PART, AND AMENDED IN PART.

      . La.R.S. 4581 provides:
      “The holder of a vendor’s privilege on movable property which is destroyed by fire has a privilege to the amount of the unpaid portion of the purchase price on the claim or money due the owner or vendee under policies of insurance covering that property. This privilege has the rank of a vendor’s privilege on the thing sold and is superior in rank to any privilege growing out of the attachment, garnishment, or seizure of the claim or money.”

      . La.R.S. 4582 provides:
      “In order to protect the privilege provided in R.S. 9:4581, the vendor, his heirs, or assigns shall give, at any time prior to the payment of the amount due under the policies, written notice to the insurer of the existence of the claim and state under oath the amount thereof. On the receipt of this notice the insurer shall give written notice to the assured of the filing of the vendor’s claim, and in the event of a dispute between the vendor and his vendee, or of any one claiming adverse interest under oath, the insurer shall deposit, subject to the right of all parties in interest, the amount due under the policies in the registry of the court having jurisdiction in any suit that may be brought on the policies to recover the amount due thereunder. Having made the deposit, the insurer shall be relieved of further responsibility.”


author: LOTTINGER, Judge. PER CURIAM.

text:
    Bill J. GOOD et al. v. LOUISIANA COMMISSION ON GOVERNMENTAL ETHICS.
    No. 12504.
    Court of Appeal of Louisiana, First Circuit.
    March 5, 1979.
    Rehearing Denied April 17, 1979.
    Writ Refused June 1, 1979.

      John P. Nelson, Jr., New Orleans, for plaintiffs-appellees.
    R. Gray Sexton, Baton Rouge, for defendant-appellant.
    Before LOTTINGER, CHIASSON and SARTAIN, JJ.
   LOTTINGER, Judge.

This is an appeal from the granting of a preliminary writ of injunction. The defendant, Louisiana Commission on Governmental Ethics (Commission), claims the right to hold investigatory hearings involving the actions of the plaintiffs, Bill J. Good, Dean of the College of Sciences, University of New Orleans, and his wife, Mary L. Good, Boyd Professor of Chemistry and a member of the faculty of the College of Sciences. The trial judge entered a preliminary writ of injunction halting the Commission’s conducting any proceedings against Bill J. Good, and the Commission appeals.

On May 8, 1978, plaintiffs filed a class action suit requesting a declaratory judgment along with injunctive relief. The action was brought on behalf of “teachers, professionals and administrative officers of all schools, colleges and universities of this state when acting in their official capacity.” Plaintiffs allege that the Commission lacks the authority to conduct investigations of the members of the class. Further, injunc-tive relief was sought by Bill Good to halt any further investigatory proceedings against him.

Defendant filed a “dilatory and/or peremptory exception” of no cause of action asserting that plaintiffs failed to exhaust their administrative remedies and that the injunctive relief would be premature since no accusatory investigation was scheduled to be conducted. Investigatory hearings were conducted by the Commission in December of 1977; however, the Commission claimed that the actual holding of an accusatory investigation was merely speculative.

On August 4, 1978, plaintiff, Bill Good, and defendant stipulated that plaintiff’s request for injunctive relief would be dismissed without prejudice, reserving his right to assert it at a later date, and overruling defendant’s exceptions, giving defendant twenty days to file responsive pleadings. Judgment was signed accordingly on August 17, 1978.

Bill Good reasserted his request for in-junctive relief on August 25,1978, based on his belief that a public hearing against him was imminent. Defendant urged the dilatory and/or peremptory exception of no cause of action and a motion to recall the rule for preliminary injunction. A hearing was conducted on September 8, 1978, and the trial judge granted the preliminary writ of injunction. The court overruled defendant’s exceptions, and judgment was rendered and signed on September 15, 1978.

Defendant appeals contending that the trial judge erred in concluding — without the taking of evidence — that the Commission was without jurisdiction to investigate an employee at the University of New Orleans for alleged violations of the Code of Ethics; in granting injunctive relief to the petitioner in the absence of any factual demonstration that irreparable injury or harm would follow if such injunctive relief was not forthcoming; and in failing to grant dilatory and peremptory exceptions, filed by the Commission, when it was manifest from the position assumed by the Commission that the respondent to the investigation was being charged himself with personal and ultra vires activities unrelated to his official conduct as a teaching or professional employee at the University of New Orleans.

We do not agree that the trial judge granted this preliminary injunction without the taking of evidence. La.C.C.P. art. 3609 in part provides that “the court may hear an application for a preliminary injunction * * * upon the verified pleadings or supporting affidavits, or may take proof as in ordinary cases.” The pleading with attachment which led to the granting of this preliminary injunction was verified. In its brief defendant-appellant argues that the court should “focus its attention” on the Commission’s letter of August 23, 1978, for an understanding of the Commission’s intentions. The letter which was attached to a trial memorandum does not comply with La.C.C.P. art. 3609 as evidence reviewable by the trial judge in issuing a preliminary injunction, and was never introduced and filed into evidence. This court cannot review evidence that is not in the record, nor can this court receive evidence so as to supplement the record. We note an absence in the record of any attempt by defendant to introduce evidence or a proffer of any evidence disallowed by the trial judge.

The evidence in the record consists of the verified pleading which points out that Dr. Bill Good is a dean at the University of New Orleans, and he is to be investigated by the Commission on a date certain. We agree with the argument advanced by defendant that Dr. Good is subject to the jurisdiction of the Commission for that which he does personally vis-a-vis officially; however, there is no evidence in the record that the Commission was interested in Dr. Good for anything other than his official activities. La.R.S. 42:llllG(f). Thus, we find no error on the part of the trial judge.

As to the other specifications of error, same were not argued in brief, and thus we consider them abandoned.

Appellee has answered this appeal requesting attorney’s fees and damages for frivolous appeal. We note, however, that the answer was not filed timely under La.C. C.P. art. 2133 and thus, we cannot consider appellee’s request.

Therefore, for the above and foregoing reasons the judgment of the trial court is affirmed. Appellants are to pay all costs as allowed by law.

AFFIRMED.

ON REHEARING

PER CURIAM.

In its application for a rehearing, defendant — Louisiana Commission on Governmental Ethics — points out a failure at the trial level to mark the Commission’s letter of August 23, 1978, as evidence. Attached to the application for rehearing is an affidavit by the court reporter attesting to the error. Thus, we consider the letter as evidence properly introduced.

However, in reviewing the letter, though the Commission states therein its intention to investigate Dr. Good “personally and/or as a state employee,” it is impossible for this Court, as apparently it was for the trial court to determine from the letter that which Dr. Good did personally vis-a-vis as a state employee.

Necessarily then, we deny the rehearing. REHEARING DENIED.

      . La.R.S. 42:1111 G(f) provides:
      “Unless the context of this Part clearly indicates otherwise, the following words and terms when used in this Part shall have the respective meanings defined as follows:
      * % * if: * *
      “G. ‘State employee’ means any one, whether compensated or not, who is
      ****** “Notwithstanding the foregoing, the term ‘state employee’ shall not include, while acting in their official capacities
      ****** “(f) The teaching, professional and administrative officers of all schools, colleges and universities of the state. * * * ”


author: BAILES, Judge.

text:
    Sam J. SIRACUSA et al. v. JEBCO TOWING COMPANY et al.
    No. 12521.
    Court of Appeal of Louisiana, First Circuit.
    March 5, 1979.
    Rehearing Denied April 16, 1979.

      Gerald F. Lofaso, Houma, for plaintiff.
    W. Gerald Gaudet, Voorhies & Labbe’, Lafayette, for Devco Towing Co.
    Paul J. Breaux, Allen, Gooch & Bourgeois, Ltd., Lafayette, for Sweetwater Towing, Inc.
    Before ELLIS, LOTTINGER and BAILES, JJ.
   BAILES, Judge.

This is an action in tort to recover damages allegedly inflicted on a bulkhead located on the north bank of the Intracoastal Canal in St. Mary Parish on July 29, 1974, when rammed by a barge being pushed by the tug ANNA C. The petition named Jebco Towing Company as the owner of the tug ANNA C., however, Devco Towing Company, Inc., answered the petition, stating that Jebco Towing Company was erroneously named the defendant instead of Devco Towing Company, Inc., sometimes hereinafter referred to simply as Devco.

Devco filed a third party petition against Sweetwater Towing, Inc., alleging that the ramming of the bulkhead was caused by the negligent operation of the tug CATAHOU-LA. Sweetwater Towing, Inc., answered the third party petition of Devco and also filed a third party action against Devco alleging that if Sweetwater is liable there should be judgment in favor of Sweetwater against Devco as Devco was contributorily negligent in the operation of the tug ANNA C. By supplemental and amending petition, plaintiff added Sweetwater Towing, Inc., as a party defendant alleging inter alia, that Devco and Sweetwater are joint tortfeasors and liable jointly and in solido unto plaintiffs for the damages to their bulkhead.

After trial on the merits, the district court found that the bulkhead was rammed through the negligent operation of the tug ANNA C. and that Devco was solely liable for the damages. Plaintiffs were awarded $32,000, together with legal interest from date of judicial demand until paid. Plaintiffs’ demand against Sweetwater Towing, Inc., were rejected as were the third party demands of Devco Towing Company, Inc., against Sweetwater Towing, Inc.

Defendant Devco appealed suspensively and the plaintiffs appealed devolutively, to protect themselves in the event this court should reverse the judgment on a finding that Sweetwater alone was guilty of negligence proximately causing the plaintiffs’ damages.

The trial judge in his written reasons for judgment succinctly stated the pertinent facts on this accident which we quote as follows:

“On June 26,1974, the tug ANNA C. was travelling on the Intracoastal Canal in St. Mary Parish, in a westerly direction, pushing four loaded barges. As it was going down a straight stretch of the Intracoastal Canal in the vicinity of plaintiff’s (sic) property, it was travelling in the center of the canal. At this time, a vessel headed eastward was also approaching. The vessels signaled each other and both veered to their right side lane of travel. The ANNA C. and her pushed tow was heavily ladened, making about four miles per hour. As the captain of the ANNA C. attempted to return to the center of the canal, he experienced difficulty and could not turn his vessel or reverse it, even though he tried, in time to avoid hitting the plaintiff’s (sic) property and damaging a bulkhead located thereon.

“This Court finds no negligence on the part of the tug CATAHOULA and the captain of the ANNA C. even admits this in his deposition. This Court finds that the sole cause of the plaintiff’s (sic) damage resulted from the negligent manner in which the tug was handled and will award the plaintiff’s (sic) judgment in these proceedings.”

We find the record clearly supports the trial court’s finding of facts and we agree with its determination of liability.

The more serious question for consideration is that of damages. Immediately after the accident, plaintiffs obtained three estimates for the repair of the bulkhead. These bids were as follows:

Berry Bros. General Contractors, Inc. $32,000
Odom Construction Company, Inc. $22,500
C. S. Thorguson Company, Inc. $105 per linear foot X 110 feet $11,550

The only witness to testify for the plaintiffs was the representative of Berry Bros. General Contractors, Inc., a Mr. Robert Wadhams. He testified that his capacity with Berry Bros, was project and pile driving engineer, and that prior to estimating on the cost and submitting the bid he went to the property, examined and inspected the condition of the bulkhead.

In the letter of Berry Bros. General Contractors, Inc., Mr. Wadhams stated:

“It is my pleasure to quote you our price of $32,000.00 to repair 100 LF of bulkhead damaged when hit by a barge tow. “From my observations, 100 feet of bulkhead was damaged to such an extent that it will have to be pulled out and replaced. Damage consists of broken tie back cables, broken wales and sheeting pushed out.
“My price includes the following materials:
11 — 40' Cl. B face pile
12 — 30' Cl. B tie back pile
200— 3 X 12 X 24' bulkhead boards
10— 8 X 10 X 22'0" wales
10— 3 X 12 X 20'0" wales
1— Lot 1" cable & clips & nailes”

(Emphasis added by the court)

The bid of Odom Construction Company, Inc., is:

“We propose to furnish labor, material, equipment and a supervision required to replace 100 linear ft of bulkhead for a
LUMPSUM .$22,500.00
“The bulkhead referred to above is located behind Braun Welding Company at Morgan City on the Intercoastal Waterway.”
(Emphasis added by the court).

The bid of C. S. Thorguson Co., Inc., states:

“We agree to furnish all labor, equipment and material necessary to remove and replace approximately 110 linear feet of bulkhead behind Braun Welding Service in Siracusaville damaged by the Tug “Anna C” for the sum of ONE HUNDRED FIVE DOLLARS PER LINEAR FOOT ($105.00/lin. ft.). The material to be used includes:
30 ft. outside piles
20 ft. tieback piles
4" X 12" walers
3" X 12" decking (approximately 40' is double sheeting.”

(Emphasis added by the court)

No representative of either Odom Construction Company or C. S. Thorguson Co. was called to explain the respective bids, to compare the three bids or to explain such widespread differences in these bids. Mr. Wadhams was not questioned about this. The only other witness to appear for the plaintiffs on the question of cost to correct the damage was Mr. Elmo Justilian who on November 9, 1976, worked for and submitted a bid to plaintiffs on behalf of Diamond Services. This bid is as follows:

“As per a phone conversation with Mrs. Siracusa, Diamond Services Corp. proposes to drive approximately 100' of bulkhead 3' X 12' X 16' using 50' pilings for the
Lump Sum Price of $36,286.38.”

On February 18, 1978, Mr. Justilian on behalf of Diamond Services submitted a bid for the identical work described in his previous bid in the sum of $47,862.71.

It was the testimony of Mr. Elmo Justili-an of which the trial judge stated he was impressed but rejected for the reason that the bid he submitted was higher than the bid by Mr. Wadhams on behalf of Berry Bros. The trial judge apparently did not consider nor call into question the two lower bids submitted to plaintiffs in 1974, as no mention is made of these bids in his reasons for judgment.

This court in the case of Davis v. Roberts, 194 So.2d 772 (1967), stated:

“In arriving at the amount of damages to property, our courts have in the past followed generally three approaches. The cost of restoration, if the thing damaged can be adequately repaired. Hayward v. Carraway, La.App., 180 So.2d 758; Lambert v. American Box Co., 144 La. 604, 81 So. 95, 3 A.L.R. 612. The difference in value prior to the damage and the value following the damage. Maryland Casualty Co. v. Rittiner, La.App., 133 So.2d 172. If the value before and after the damage cannot be reasonably determined or if the cost of repairs exceed the value of the thing damaged, the measure of damages to the owner has been the cost of replacement new, less reasonable depreciation. Palmetto Moss Factory v. Texas & P. Ry. Co., 145 La. 555, 82 So. 700; Reisz v. Kansas City Southern R. Co., 148 La. 929, 88 So. 120; Gray v. Security Storage & Van Co., La.App., 26 So.2d 399.”

The evidence shows the entire length of the bulkhead to be 195 feet of which either 100 or 110 feet were damaged in the collision. As there was a partial destruction of the bulkhead the plaintiffs are entitled to the fair cost of repair.

By comparing the three bids submitted for the repairs it is obvious that the trial court was convinced that the Berry Bros, bid more adequately covered the damages incurred which justified its acceptance of the higher bid. We find no abuse of its broad discretion.

While the plaintiffs contend they are entitled to an award of damages in an amount equal to present costs of correction, the trial court correctly determined that damages are to be awarded on the 1974 cost to correct and not the present-day cost. There is no evidence in the record to explain the delay of the repairs. Absent a showing that the delay in repair is attributable to the appellant or through no fault of the plaintiffs the cost to correct must be determined as of the time the damage was incurred.

Accordingly, for the foregoing reasons the judgment appealed is affirmed at appellant’s cost.

AFFIRMED.


author: MARVIN, Judge.

text:
    CULLIGAN WATER CONDITIONING, INC., Plaintiff-Appellee, v. HEIRS of Eliza S. WATSON et al., Defendants-Appellants.
    No. 13836.
    Court of Appeal of Louisiana, Second Circuit.
    March 26, 1979.
    En Banc. Rehearing Denied May 3, 1979.
    Writ Refused June 15,1979.

      Hargrove, Guyton, Ramey & Barlow by Thomas J. Wyatt and Joseph L. Hargrove, Jr., Shreveport, for defendants-appellants, H. E. Britt, et al.
    Richie & Richie by John A. Richie, Shreveport, for defendant-appellant, Dovie Irene Crocker Hogan.
    Wiener, Weiss, Madison & Howell by John M. Madison, Jr., Shreveport, for plaintiff-appellee, Culligan Water Conditioning, Inc.
    Dale Cox, Shreveport, Curator ad Hoc for defendants-appellees, Unknown Heirs of John H. Gunn, W. R. Phelps, Eliza S. Watson; and Joseph Lynn Gillis and Virginia King Delano.
    Hargrove, Guyton, Ramey & Barlow by Ray A. Barlow, Shreveport, for defendants-appellees, John Lund, Ena K. Lund, and Wilson & Co., Inc.
    Booth, Lockard, Jack, Pleasant & LeSage by Joe C. LeSage, Jr., Shreveport, for defendant-appellee, Foremost-McKesson, Inc.
    James R. Malsh, Asst. City Atty., Shreveport, for defendant-appellee, City of Shreveport.
    Before PRICE, MARVIN and JONES, JJ.
   MARVIN, Judge.

This appeal of a declaratory judgment involves title to portions of a 150-foot strip of land in Shreveport on which a track was maintained by a railroad for more than a hundred years until it was removed about 1962. Plaintiff’s title, which was recognized in the judgment, stems from heirs of the person who owned the property when the railroad was built. Defendants, who are appealing the judgment, generally are owners of city lots abutting the strip whose claims or titles stem from the railroad and adverse possession. We affirm.

This case is somewhat of a sequel to Bray v. Boyd, 286 So.2d 508 (La.App. 2d Cir. 1973), writ refused. Plaintiff’s principal stockholder was the plaintiff in that case. There the instrument by which it is claimed that the railroad acquired its authority over the strip was construed as a mere servitude. That decision must be reexamined in light of this record and the contentions made here relative to the later holding in Pure Oil Company v. Skinner, 294 So.2d 797 (La. 1974), that the plaintiff in a declaratory-petitory action who is not in possession, must make out its title good against the world.

The disputed strip was a part of a 145 acre tract acquired by Eliza Harris in 1841. She later married Matthew Watson and entered into a marriage contract, retaining the control and management of this, her separate property, which became known as Idlewilde Plantation. Matthew Watson, who of parenthetical historical significance was the sheriff of Caddo Parish, sold to the railroad in 1853, without the authorization of his wife, what Bray held was a servitude across the 150-foot strip.

Eliza Harris Watson, who died in 1869 leaving eight children, willed to three of her children the property which she described as lying between the railroad and a public road (Greenwood Road) to the north. The remaining property, partitioned into lots, was willed to all eight children. Lot 30 of the partition was described as and was shown on the partition plat as being south of the railroad. By these or similar descriptions, through mesne conveyances, the property was sold to people who eventually subdivided it into city lots. Idlewilde Courts, north of the railroad, was subdivided in 1925 by J. S. Swann and others. Bellview Subdivision, south of the railroad, was subdivided in 1913 by Thomas Bell.

A part of the plat of Bellview Subdivision, on which we show the relative position of Idlewilde Courts, Interstate 20, and the property in dispute here and in Bray, is reproduced:

Illustration to follow.

The 150-foot strip was described in the 1853 instrument from Matthew Watson to the railroad as . .75 feet of land on each side of the middle of the line of said road as located by the survey . . .”

In 1916, the railroad quitclaimed to Thomas Bell’s heirs the southernmost 25 feet of the south half of the strip and these heirs in turn, quitclaimed to the railroad their interest in the remaining 50 feet. The subdivision plats show that the south line of the Idlewilde lots is the north line of the 150-foot strip and that the north line of the Bellview lots approximates the south line of the 150-foot strip when the alley shown on the Bellview Subdivision plat is taken into consideration. This alley was declared abandoned by the City in 1967.

In 1962 the railroad removed its tracks from the 150-foot strip. In 1964 the railroad sold and began to sell by non-warranty deeds, specifically described tracts in the 150-foot strip. Each railroad vendee generally was conveyed the property in the strip immediately corresponding to the subdivision lot or lots owned by the vendee. Plaintiff’s declaratory judgment action was filed in 1974, within 10 years of the date of the first such deed by the railroad.

Appellants, in an answer and reconven-tional demand below, sought to have plaintiff’s demands rejected and alternatively sought judgments for the taxes, improvements and expenditures. Here appellants do claim that they have acquired title by acquisitive prescription of 10 and 30 years even if plaintiff’s title be found to comply with Pure Oil and CCP 3654(1), 3653(1). The record, however, does not support this claim.

There is no evidence that any person other than the railroad possessed any portion of the north half of the strip so as to meet the requirements of a 30-year prescriptive title. Even good faith possession for more than 10 years, but less than 30 years, is not sufficient to establish a prescriptive title in the absence of a deed translative of title. C.C. Art. 3499.

A quitclaim deed may be the basis of the 10-year acquisitive prescription but such a deed, without a showing of good faith possession, does not alone establish prescriptive title. The 25 feet that was quitclaimed to the Bell heirs by the railroad in 1916 generally approximates the 20 foot alley shown on the Bellview Subdivision plat of 1913. Whether or not the public used the alley, the heirs of Thomas Bell are bound by his dedication in 1913 of the alley to public use and notwithstanding their quitclaim deed from the railroad in 1916, they cannot adversely possess against the public. La.Const. (1921) Art. 19, § 16; La. Const. (1974) Art. 12, § 13; Louisiana Highway Commission v. Raxsdale, 12 So.2d 631 (La.App. 2d Cir. 1943). The dedication of the public alley was not revoked or abandoned by the City until 1967, some seven years before suit was brought. In any event, defendants have not shown what, if any, possession was exercised by the Bell heirs after 1916 of the alleyway in question.

The evidence does not show that the south line of the strip encroaches into the Bellview Subdivision lots or vice versa. When the subdivision was platted, there may well have been 75 or more feet between the north line of the Bellview lots and the once existing centerline of the railroad. Plaintiff does not appeal from the judgment, however, excepting the north five feet of certain numbered Bellview lots from its recognized title. See footnote two.

The record is devoid of evidence showing any acts of adverse possession in the south half of the 150-foot strip before 1944 (or more than 30 years before this suit was filed by plaintiff). We are not hesitant then to conclude that appellants’ claims to title by acquisitive prescription are without factual support because plaintiff brought this action within 10 years of the date of the earliest deed by the railroad to any defendant.

This conclusion turns us to the reexamination of the 1853 instrument and the record title to the strip in the light of Pure Oil.

When the children of Eliza Harris Watson sold their interests in the property lying on each side of the railroad, they tacitly accepted their mother’s succession. C.C. Arts. 988, 994, 999, 1002, Southern Natural Gas Company v. Naquin, 167 So.2d 434 (La. App. 1st Cir. 1964). These children were seized or vested with the ownership of all of their mother’s estate, even though a succession was not formally opened or a succession judgment recorded on the public records. C.C. Arts. 1626, 940, 946. The rights of the now living heirs of Eliza Harris Watson in successions which were not opened or which were perhaps not even accepted by the then heirs were nevertheless transmitted to the living heirs by operation of law. C.C. 944, 1626; Succession of Martin, 234 La. 566, 100 So.2d 509 (1958); Succession of Platt, 300 So.2d 503 (La.App. 2d Cir. 1974).

Seizin operates so that at the moment of death, the ownership of a decedent’s property vests in the decedent’s heirs or legatees immediately by operation of law. See Oppenheim, 10 Louisiana Civil Law Treatise, Successions and Donations, § 51 (1973); Lazarus, The Work of the Louisiana Appellate Courts for the 1971-1972 Term, Successions and Donations, 33 La.L.Rev. 199.

Plaintiff’s record title is intact from the original patent through the deed to Eliza Harris Watson. The next recorded deeds affecting the interest of Eliza Harris Watson in the 150-foot strip date from 1966 when plaintiff and his predecessor in title began acquiring the interests of the several heirs of Eliza Harris Watson.

Plaintiff’s burden under Pure Oil was to prove a valid record title, good against the world. Defendants strenuously argue that plaintiff must fail here because there are no recorded judgments of possession in most instances affecting the interest of Eliza Harris Watson and her heirs in the strip. The title to property acquired by inheritance does not require recordation to be effective against third persons.

“The law of registry is inapplicable where the ownership of . immovable property . . . has been acquired by inheritance and title has become vested by operation of law.” (Citations omitted) Jackson v. D’Aubin, 338 So.2d 575, 580 (La.1976)

See also Lowry v. Atlantic Refining Company, 231 F.Supp. 775 (W.D.La.1964), aff. 363 F.2d 876 (5th Cir. 1966).

The interest of Eliza Harris Watson in the strip vested in her heirs at her death. Defendants here are not prejudiced by the absence or non-recordation of succession judgments. In this record, plaintiff has shown the descending lineage of the late Eliza Harris Watson and has shown its acquisitions from these many heirs, with the exception noted of Ms. Delano. Pure Oil does not abrogate these principles, which Jackson v. D’Aubin said have been “consistently held.” Accordingly, we hold that plaintiff has met the burden of Pure Oil and C.C.P. 3654(1).

OTHER CONTENTIONS

Defendants strenuously and astutely argue that the 1853 instrument from Matthew Watson to the railroad is susceptible of being construed either as a servitude or as a deed with a resolutory condition. They assert that if the instrument is ambiguous as they contend, the extrinsic evidence — a receipt to the railroad executed and filed in the public records by Matthew Watson in 1857 — establishes that the instrument was a sale of land with a resolutory condition. The receipt shows the railroad paid more than twice as much as was recited as paid by Eliza Harris Watson when she acquired the 145 acre tract in 1841. We recognize the emphasis of defendants’ argument but must also note that Eliza Harris Watson acquired the larger tract from a relative and that similar arguments, excluding the receipt, were made in Bray. In any event, Matthew Watson had no title or authorization to sell. Our conclusions about the instrument in Bray, we believe, were correctly made and are adopted here. The receipt, which is expressly for a “right of way,” does not persuade us otherwise. The railroad acquired a servitude and nothing more.

The railroad possessed the strip precariously. C.C. 3510. In John T. Moore P. Co. v. Morgan’s Louisiana & T.R. & S.S. Co., 126 La. 840, 53 So. 22 (1910), it was said:

“Because the Opelousas Railroad’s possession was of a servitude, and was continued unchanged, and, as a matter of course the possession of a servitude cannot mature into the ownership of the fee by prescription, no matter how protracted.
“ ‘The person enjoying a servitude is a precarious possessor. No matter how numerous may be the acts done by him animo domini, they cannot serve to show possession of the fee when the proof is made that the possession began by virtue of a title which conferred only a right of servitude.’ Carpentier et Du Saint, Vo. Pres., No. 1214.” 53 So. at 32. See C.C. Art. 3514.

Moore Planting Company also answers defendants’ contention that the railroad possessed 50 feet of the strip as owner after the 1916 quitclaim deeds from the Bell heirs.

“. . . it is very plain that for a precarious possessor, such as the holder of a servitude, to change the cause of his possession and inaugurate a new possession, it does not suffice for him to acquire and record a new title; but that he must, in addition, indicate by some outward acts of possession his intention to hold no longer under the old title but under the new; and that these acts must be of an unusually pronounced character. He must so conduct himself as to let the owner know that a new order of things has begun . . . ” 53 So. at 35. See C.C. Art. 3512.

The record shows no possession by the railroad other than as an owner of a servitude. It should also be noted that in at least two suits in the Caddo Parish District Court against the railroad, an instrument identical in form to the one here was held to have conveyed only a servitude.

Defendants also contend that when the heirs of Eliza Harris Watson partitioned and sold to third parties the lands described as lying or being north of the railroad and south of the railroad, the land sold was from the centerline of the railroad and not from the right of way line. This contention, however, is not supported by the plat or the description of the lands in the partition proceedings of the Eliza Harris Watson estate nor by the deeds to third parties from the heirs of Eliza Harris Watson.

When property is shown to have been described or to have been bounded by a railroad and the deed does not indicate to the contrary, the boundary is deemed to be the right of way line of the railroad and not the centerline. Hanks v. Stutes, 85 So.2d 362 (La.App. 1st Cir. 1956).

We must also reject defendants’ argument regarding laches. Mere silence or delay does not cause the loss of title to property except by the effect of the laws of acquisitive prescription. Merritt v. Hays, 237 La. 557, 111 So.2d 771 (1959); Hicks v. Hughes, 223 La. 290, 65 So.2d 603 (1953). The railroad’s enjoyment of its servitude lasted until 1962. Plaintiff and its principal stockholder began to acquire the interests of the several heirs of Eliza Harris Watson in 1966, resulting in Bray v. Boyd in 1973 and in this case.

At appellants’ cost, judgment is affirmed.

      . Numerous defendants were named in the original action brought in 1974. Some were known heirs of the person who owned the property when the railroad was built. Plaintiff succeeded in purchasing the interest of all defendant heirs except that of Virginia King Delano, who was recognized in the judgment as owning a V32 interest. Plaintiff, whose 31/32 interest was also recognized in the judgment, and Ms. Delano occupy the same legal positions and are appellees.
      The disputed strip is south of and is generally parallel to Interstate Hwy. 20 through west Shreveport. Two city streets (Portland Avenue and Kings Highway) traverse the strip in the area in dispute. The judgment recognizes the public use of these streets.

      . We should note that the railroad did convey two separate tracts in the strip to the City of Shreveport in 1963. The lower court held that the City and its vendee, Dale Allen Sumrall, met the requirements of 10 years good faith acquisitive prescription and excluded these particular properties from the judgment. Defendants H. E. Britt and Mr. and Mrs. James E. Sharp were also held to have acquired by adverse prescription the northerly five feet of their respective lots in the Bellview Subdivision. Plaintiff did not appeal nor answer defendants’ appeal and the correctness of this portion of the judgment is not before us. The judgment excepts from the plaintiffs recognized title the northerly five feet of lots 109 through 116 of Bellview Subdivision, along with other specifically described property.

      . The instrument, quoted at length in Bray, is only partly recited here with emphasis:
      “Right of Way ... I Matthew Watson . for and in consideration of the enhanced value accrued and hereafter to accrue to my land and other property by the passage of the . Rail Road through the same do hereby . sell . unto the . . . Rail Road . . . the quantity of seventy five [75] feet of land on each side of the middle of the line of said road as located by the survey aforesaid . The above sale of seventy five [75] feet on each side of the road aforesaid being for the right of way to said road through the land aforesaid. And the said . . . Rail Road Company are not to use the said land for any other purpose than the right of way.”

        Bray expressly held Matthew Watson was without title and was not shown to have been authorized to sell.
      The receipt reads:
      “Received of the [railroad], Seven Hundred and Fifty Dollars in full for the right of say of said Company’s Rail Road through my land in the Parish of Caddo . . 5th Deer. 1857.
      “(signed) M. Watson”

      . Lawton v. Illinois Central Rlwy. Co., No. 142,-944 (1962); Tucker v. Illinois Central Rlwy. Co., No. 141,560 (1960), which holding was acknowledged in State, Department of Highways v. Tucker, 247 La. 188, 170 So.2d 371, 372 (1964).


author: WATSON, Judge.

text:
    FARMERS EQUIPMENT SALES, INC., Plaintiff-Appellee, v. Paul CONSTANZA, Defendant-Appellant.
    No. 6766.
    Court of Appeal of Louisiana, Third Circuit.
    April 11, 1979.

      Thistlethwaite & Thistlethwaite by Hugh William Thistlethwaite, Jr., Opelousas, for defendant-appellant.
    Fusilier, Pucheu & Soileau, J. Wendel Fusilier, Ville Platte, for plaintiff-appellee.
    Before WATSON, GUIDRY and FORET, JJ.
   WATSON, Judge.

This suit was consolidated for trial and appeal with our docket no. 6767, Farmers International Sales, Inc. v. Constanza, 370 So.2d 138. Plaintiff, Farmers Equipment Sales, Inc., is a successor company to Farmers International Sales, Inc., plaintiff in docket no. 6767. The name of the corporation was changed during its operations. Both suits involve claims against defendant, Constanza. In docket no. 6766, LeBlanc and O’Malley, certified public accountants, and Fusilier, Pucheu and Soileau, attorneys at law, were substituted as parties-plaintiff. The trial court gave judgment in favor of Fusilier, Pucheu and Soileau for an open account of $2,642.79, and in favor of Le-Blanc and O’Malley on a note for $2,552.71. In docket no. 6767, the trial court gave judgment in favor of Farmers International Sales, Inc. on a note for $4,073.81, plus eight (8%) percent interest from February 25, 1970, and twenty-five (25%) percent attorney’s fees. Defendant Constanza has appealed from the judgments in both suits.

Defendant Constanza contends that the sums demanded had been paid and/or were not owed; that the trial court erred in allowing the attorneys and accountants to be substituted as parties-plaintiff in docket no. 6766; and that the trial court erred in giving judgment in favor of the bankrupt plaintiff in docket no. 6767.

Decision of the appeal is hampered by the unexplained absence from the appellate record of Exhibits D-7 through D-35 and P-1 through P-13. These exhibits include the notes, the assignments, Constanza’s deposition and other items of evidence. However, the signature of defendant on the two notes was admitted at the pretrial conference.

Farmers Equipment Sales, Inc. was discharged in bankruptcy on April 25, 1975. (D-2). William Sandoz, receiver and trustee for the bankruptcy, testified that he did not contest the assignments to the attorneys and accountants, because he did not regard them as voidable preferences. The trial court made a factual finding that the assignments were valid. The note involved in docket no. 6767 was not included in the bankruptcy proceedings as the result of an oversight amid confusion in the affairs of the bankrupt. Sandoz said it was not unusual for a debt to be omitted from a bankrupt’s schedule of assets and liabilities and that, if any additional funds were received in connection with that suit, the bankruptcy could be reopened.

Review of the full facts is impossible because of the missing exhibits. LSA-C.C.P. art. 2161 provides:

“An appeal shall not be dismissed because the trial record is missing, incomplete or in error no matter who is responsible, and the court may remand the case either for retrial or for correction of the record. An appeal shall not be dismissed because of any other irregularity, error or defect unless it is imputable to the appellant. Except as provided in Article 2162, a motion to dismiss an appeal because of any irregularity, error or defect which is imputable to the appellant must be filed within three days, exclusive of holidays, of the return day or the date on which the record on appeal is lodged in the appellate court, whichever is later.”

Neither retrial nor correction of the record is feasible under these circumstances. Since the omissions are not imputable to defendant-appellant, the appeal cannot be dismissed. Our review is limited, but the trial court judgment is presumed to be correct. DePriest v. Connecticut Fire Insurance Company, 140 So.2d 458 (La.App. 1 Cir. 1962); Bowie v. Bowie, 228 So.2d 83 (La.App. 2 Cir. 1969); Clark v. Richardson, 157 So.2d 325 (La.App. 3 Cir. 1963).

The first issue is defendant Constan-za’s contention that the sums involved were not owed and/or had been paid. Constanza admitted that the amount claimed on open account had been charged to him, but said he did not owe it because it should have been covered by warranties on the equipment purchased. Ronald Fontenot, president, part owner and bookkeeper of Farmers, testified that Constanza owed this amount. Constanza said the note for $2,552.71 was supposed to have been destroyed. He did not know the origin of the note for $4,073.81. Fontenot’s testimony was that the smaller note represented a down payment on equipment and the larger note was given to secure an amount owed by Constanza on open account. Constanza’s evidence was limited to his own testimony. The trial court apparently made a credibility evaluation adverse to defendant in deciding that Constanza owed the sums claimed. No error has been shown.

The second issue is the validity of the assignments to the attorneys and accountants. The suit in docket no. 6766 was filed October 21,1971, and the suit in docket nó. 6767 was filed February 24, 1972. Ronald Fontenot testified that the assignments were made in November of 1971, shortly after the filing of the first lawsuit. One of the partners in the accounting firm, Eddie M. LeBlanc, Jr., testified that the note was assigned to his firm near the end of October, 1971. J. Wendel Fusilier, a member of the law firm to whom the open account was assigned, testified that the assignments were made after the first suit was filed on October 21, 1971, in order to secure payment of fees owed to his firm and that of the accountants for work being done. The bankruptcy petition was filed March 9, 1972. Sandoz testified that he was appointed receiver on that date. San-doz was award of the two lawsuits and the two assignments. Fusilier testified that the two causes of action which were assigned were not included in the bankruptcy petition because they were not preferential transfers. Sandoz agreed with this opinion.

The trial court correctly concluded that the assignments were valid. They transferred litigious rights owned by the bankrupt prior to the bankruptcy. Wiley v. Public Investors Life Insurance Company, 498 F.2d 101 (1974). The assignments did not constitute voidable preferences, although made within a year prior to the filing of the bankruptcy petition, because there was fair consideration. In re Southern Land Title Corporation, 474 F.2d 1033 (1978). The evidence is that the assignments were made in good faith to satisfy antecedent debts.

The third issue is whether judgment should have been given in favor of the bankrupt, Farmers International Sales, Inc. in suit no. 6767. The suit was filed prior to the filing of the bankruptcy petition when Farmers was a proper party plaintiff. Compare Rodrigue Co., Inc. v. Gilmore, 339 So.2d 527 (La.App. 4 Cir. 1976). Since the debt was not listed on the bankruptcy schedule and was not subject to the administration of the trustee, the trial court correctly granted judgment in favor of plaintiff Farmers. Even if a debt is listed on the schedule of assets, it has been held that the trustee of a bankruptcy has discretion to either prosecute the pending litigation or to allow the litigation to continue in the name of the bankrupt and await its outcome. Johnson v. Best Manufacturing Co., 263 So.2d 436 (La.App. 1 Cir. 1972). See the comment at 34 Louisiana Law Review 316.

For the foregoing reasons, the judgment of the trial court herein is affirmed at the cost of defendant-appellant, Paul Constan-za.

AFFIRMED.

      . Although LSA-C.C. art. 2447 prohibits public officers from purchasing litigious rights, LSA-R.S. 37:218 specifically allows attorneys to acquire an interest in a suit as a fee.


text:
    FARMERS INTERNATIONAL SALES, INC., Plaintiff-Appellee, v. Paul CONSTANZA, Defendant-Appellant.
    No. 6767.
    Court of Appeal of Louisiana, Third Circuit.
    April 11, 1979.
    Thistlethwaite & Thistlethwaite by Hugh William Thistlethwaite, Jr., Opelousas, for defendant-appellant.
    Fusilier, Pucheu & Soileau, J. Wendel Fusilier, Ville Platte, for plaintiff-appellee.
    Before WATSON, GUIDRY and FORET, JJ.
   WATSON, Judge.

For the reasons assigned in the consolidated case, docket no. 6766, Farmers Equipment Sales, Inc. v. Constanza, 370 So.2d 135, the judgment of the trial court herein is affirmed at the cost of defendant-appellant, Paul Constanza.

AFFIRMED.


author: SWIFT, Judge.

text:
    Leonce BOUDREAUX, Plaintiff-Appellant, v. Rosie Lee (Edwards) MATT, Defendant-Appellee.
    No. 6825.
    Court of Appeal of Louisiana, Third Circuit.
    April 11, 1979.

      Julius P. Harrell, Baton Rouge, for plaintiff-appellant.
    Sandoz, Sandoz & Schiff, W. Simmons Sandoz, Opelousas, for defendant-appellee.
    Before DOMENGEAUX, SWIFT and DOUCET, JJ.
   SWIFT, Judge.

This is an appeal by Leonce Boudreaux, plaintiff-in-rule, from a judgment of the trial court in favor of Rosie Lee (Edwards) Matt, defendant-in-rule, decreeing that the plaintiff is not the father, “biological or otherwise”, of the latter’s eleven year old son, Melvin Jay Daniel, and therefore is not entitled to custodial or visitation rights with respect to this child. The judgment also gave Mrs. Matt custody of two of her other minor children whose natural father was admittedly the plaintiff, awarded her child support therefor and provided specific visitation rights for the father. However, on this appeal we are only concerned with that part of the decree which deals with Melvin Daniel.

In her original answer to the petition, the defendant admitted that all three children were born as a result of her cohabitation with the plaintiff. However, she subsequently amended the pleading with court approval to deny that Leonce Bou-dreaux was the father of Melvin Daniel. There being no indication in the record that the plaintiff was misled or deceived by defendant’s first answer, his contention that she is bound by such admission as a judicial confession has no merit. O’Neal v. Allstate Insurance Company, 228 So.2d 249, (La.App. 1 Cir. 1969); and Landry v. Landry, 140 So.2d 706 (La.App. 3 Cir. 1962).

The plaintiff also complains of the trial judge having sustained an objection to his testimony that the defendant had told him he was the father of the child. Such evidence was proffered under LSA-C.C.P. Art. 1636. However, the ruling was correct and the testimony cannot be considered in this case.

It is well settled in Louisiana that a mother’s testimony or admission which would have the effect of making her child illegitimate cannot overcome the legal presumption provided by LSA-C.C. Art. 184 that the husband of the mother is the father of the children conceived during the marriage, and such testimony and admissions must be disregarded. Feazel v. Feazel, 222 La. 113, 62 So.2d 119 (La.1952); Trahan v. Trahan, 142 So.2d 571 (La.App. 3 Cir. 1962); and Hodges v. Hodges, 348 So.2d 1284 (La.App. 4 Cir. 1977).

The only admissible evidence which indicated the plaintiff may have been the father of Melvin Daniel was his own testimony. He said that he and the defendant had intimate relations during the time that Melvin was conceived, that he took the defendant to the hospital for the birth and that she and her legal husband, Oscar Lee Daniel, separated shortly thereafter. However, plaintiff acknowledged that defendant and Mr. Daniel lived together in an apartment all during the year before the birth occurred.

In his reasons for judgment the trial judge said:

“1) I find that Melvin Daniel was conceived and born during the existence of the marriage of the defendant, Rosie Lee (Edwards) Matt to Oscar Lee Daniel. There being no evidence to show that the child was ever disavowed by Oscar Lee Daniel, the husband of the wife is, under our law, presumed to be the father of the child, and consequently, plaintiff in rule has no right to claim any of the rights given by law regarding parent and child. While it is conceivable that plaintiff in rule could be the biological father, it is equally conceivable that he is not the biological father, and I find that Mr. Bou-dreaux has not proved himself to be the biological father of Melvin Jay Daniel.”

Thus, the district judge not only found that the proof presented by the plaintiff was insufficient to overcome the strong presumption provided by Article 184 of our civil code, that the husband of the mother is the father of all chilren conceived during the marriage, but also that the plaintiff failed to establish it was more probable than not that he was responsible for the child’s conception, the burden of proof ordinarily required to establish an issue of fact. We agree with his findings of fact and conclusions.

The record does not reflect that Oscar Lee Daniel has taken any steps toward disavowal of the paternity of Melvin Daniel. Since the evidence in this case has failed to establish that the child is actually the illegitimate son of Leonce Boudreaux, we do not believe that he has been subjected to any discrimination by reason of his birth or LSA-C.C. Art. 184. Consequently, it is unnecessary for us to consider the constitutional issue raised by the plaintiff in this connection. Corpus Christi Parish Credit Union v. Martin, 358 So.2d 295 (La.1978).

For the foregoing reasons the judgment of the trial court is affirmed at appellant’s costs.

AFFIRMED.

      . The mother did not testify that Boudreaux was the father of this child.


author: CULPEPPER, Judge.

text:
    MIKE HOOKS, INC., Plaintiff and Appellee, v. ARGONAUT-SOUTHWEST INSURANCE COMPANY, Defendant and Appellant.
    No. 6885.
    Court of Appeal of Louisiana, Third Circuit.
    April 11, 1979.

      Philip E. Henderson, of Henderson, Hane-mann & Morris, Houma, for defendant and appellant.
    Anderson, Leithead, Scott, Boudreau & Savoy, Everett R. Scott, Jr., Lake Charles, for plaintiff and appellee.
    Before CULPEPPER, CUTRER and STOKER, JJ.
   CULPEPPER, Judge.

This is a suit for a declaratory judgment to ascertain the method of computation of premiums under a workmen’s compensation and employer’s liability insurance policy. The plaintiff, Mike Hooks, Inc., hereinafter referred to as “Hooks”, is the insured. The defendant, Argonaut-Southwest Insurance Company, is the insurer. Hooks operates dredge boats and tug boats, and it also employs “yard” personnel who work on land. The principal issue is whether the “experience modifications”, a provision for adjustment in the premiums to reflect the insured’s prior loss experience, should be applied to all of Hooks’ operations, including both “land” risks and “over-water” risks. These “experience modifications” are contained in the Experience Rating Plan Manual published by the Southeastern Compensation Rating Bureau, a private agency of which insurers are members and to which they report their losses for each insured in each classification.

Hooks contends the experience modifications should be based on all risks covered by the policy, which would result in a substantial savings in premiums, since its loss experience for land risks was substantially lower than its loss for over-water risks. Argonaut contends the experience modifications have no application to the over-water risks, which would mean that the premiums for these risks would remain the same as stated in the policy, and would not be raised or lowered according to the loss experience. Alternatively, Argonaut contends that if the experience modifications are applied to the over-water risks as well as the land risks, then the experience modifications published by the bureau should be revised, because Hooks’ prior over-water losses were not filed with the bureau by Highlands Insurance Company, Hooks’ prior insurer, and, hence, were not used by the bureau in computing the experience modifiers.

The district judge upheld Hooks’ position and ordered Argonaut to refund to Hooks all excess premiums paid in advance, approximately $118,000, with legal interest from March 1, 1977, the date the premiums became due. Defendant appealed. Plaintiff answered the appeal, seeking interest on the excess premiums under LSA-R.S. 22:637.1, a special statute regarding interest on refunded unearned premiums.

In excellent written reasons, the district judge has correctly stated the facts and applied the law:

“The evidence reflects that sometime pri- or to September 1, 1972, a local agent and an insurance broker for defendant called at the plaintiff’s office and informed its president and the office manager that either Highlands was going to raise its rates or its insurance policies were not going to be renewed. A plan was presented for the same coverage with the defendant, which included a comparison of the rates of the two companies to be computed on a retrospective basis. Although the plaintiff’s representatives-did not recall any particular discussion about experience modifiers, it was understood by all parties that the Argonaut policies were to provide the same coverage and be handled in the same way as the Highlands’ policies. Also, that the premiums would be less if the plaintiff’s loss experience was less than before. The defendant’s representatives had no definite recollection of any discussion of experience modifiers at the 1972 conference. However, the local agent testified that this was discussed by these persons in 1967 and 1970 when the Highlands’ policies were issued. His testimony in this regard was confirmed in part by P-13.

Shortly after the 1972 meeting the plaintiff agreed that the insurance coverage was to be placed with the defendant, and its policy numbered WC-81-290-701402, covering the period from September 1, 1972, to September 1, 1973, (P-1) was issued. It provided both land and over-water coverage, as ^shown on Appendix A attached hereto, and in CONDITION 1 said, “The premium stated in the Declarations is an estimated premium only. Upon termination of this policy, the earned premium shall be computed in accordance with the rules, rates, rating plans, premiums and minimum premiums applicable to this insurance in accordance with the manuals in use by the Company.” Also made a part of the insurance contract and all renewals thereof for a three year period was Endorsement No. 4, entitled “RETROSPECTIVE PREMIUM ENDORSEMENT — THREE YEAR-PLAN D”. (Appendix B)

When the insurance was renewed, the defendant, without notice or explanation to plaintiff, issued two policies for the period September 1, 1973, to September 1, 1974, WC-81-302-701402 (P-2) and WC-81-302-701507 (P-3) which insured the classifications of plaintiff’s operations shown on Appendix C and Appendix D, respectively. Both policies contained an endorsement which provided, “It is agreed that the premium for the policy shall be computed in accordance with the provisions of the Retrospective Premium Endorsement — Plan (D) forming a part of policy WC-81-290-701402”.

For the third year, effective September 1, 1974, to September 1, 1975, two policies were issued, WC-81-314-701402 (P — 4) and WC-81-314-701507 (P-5), which provided coverage for the operations shown on Appendix E and Appendix F, respectively. Each contained an endorsement referring to the Retrospective Premium Endorsement— Plan (D) as quoted above.

Sometime around June, 1974, the plaintiff inquired with defendant as to why the experience modification of .66 had been applied only to the land operations in computing the premiums due under its first policy. It was advised that this resulted from the fact that the bureau had not notified the defendant such promulgation had been developed. Apparently, on plaintiff’s insistence that it was entitled to such credit, the defendant issued an indorsement to P-1 raising the rates for over-water coverages, Codes, U.S. 7335 and 7028, in amounts so that when the credit was applied the premiums would be the same as before. (P-10, 11 and Endorsement No. 20, dated July 26, 1974)

Both Highlands and the defendant generally have not followed the practice of reporting and filing water losses of their insureds with the bureau and both companies take the position that water rates are not subject to the experience modification provided in the Experience Rating Plan Manual. Edward R. Soule, assistant manager of the Bureau in New Orleans, seemed to acknowledge that this is ordinarily the case as to strictly maritime losses. However, he testified that the experience modification set forth in the manual applies to a policy as a whole and not to each separate classification of the coverage. If the policy covers both land and water operations the experience modification must be applied to all of the classifications included in the policy. He added that this would not be the case if separate policies were issued, one covering the land operations and the other covering the water operations.

SECTION IV., 2, of the Rating Manual provides:

“PERIOD AND OPERATIONS AFFECTED. The experience modification shall be effective for a period of twelve months (except as provided in Rules 3 and 4 of this Section) and shall apply to all the operations of the risk, regardless of whether the current or any new operations are assigned to the same classifications as were used in establishing such modification.”

(Underscoring by this court)

According to the definitions in Section II, the “risk” is the insured under the policy.

Primarily, the defendant contends that the experience modifications provided by the manual are inapplicable to the premiums for water classification because it and the plaintiff so agreed in their negotiations prior to the issuance of P — 1 in 1972. The evidence does not reflect that the parties even mentioned the application of the experience modification in their discussions concerning the issuance of that policy. The subject was mentioned in 1967 and 1970 in regard to the Highlands’ policies and it was understood that the defendant’s policy was to be handled in the same way as Highlands’. However, there is nothing in this record which establishes that the plaintiff’s representatives were even aware of this factor when they discussed the issuance of the Argonaut policy and its rates in 1972.

In the court’s opinion, Section IV, 2, quoted above requires the application of the experience modification to all of the operations of the insured covered by the policy. The latter, of course, provides that the earned premium shall be computed in accordance with the manuals in use by the company, which includes P — 12. Since the policy covers both land and water classifications, the application of the experience modification is explicit. The court does not believe the evidence presented in this case established that the insured and the insurer clearly and definitely agreed in their negotiations to the inapplicability of the experience modification as to water losses, contrary to the written provisions of the policy that was issued and the manual. Such would be necessary even if the relief sought by the defendant in this respect is construed to be an action to reform the policy. Consequently, the court concludes that the experience modification filed with the bureau must be applied to the water losses in computing the earned premium of the policy, P-1.

Endorsement No. 20 to P-1, increasing the water classifications rates to compensate for the application of the experience modification for the first policy year, is ineffective. Condition No. 1 of P — 1 provides in part as follows:

“This policy is issued by the Company and accepted by the insured with the agreement that if any change in classifications, rates or rating plans is or becomes applicable to this policy under any law regulating this insurance or because of any amendments affecting the benefits provided by the workmen’s compensation law, such change with the effective date thereof shall be stated in an endorsement issued to form a part of this policy.”

There is nothing in the record which indicates any statutory change in classifications, rates or rating plans or benefits under the workmen’s compensation laws during the effective date of the policy. Consequently, the defendant was not entitled to unilaterally change the rates for the water classifications through the issuance of such endorsement.

In regard to a renewal of an insurance policy it was said in Crowell v. New Hampshire Fire Ins. Co., 147 So. 762 (La.App. 2 Cir. 1933):

“When the insurance agency issued the contract on June 17, 1930, it was legally bound to issue a policy containing the same terms and conditions as the original policy. By the renewal or extension, unless there is a special agreement for different terms, the original policy is continued under the original stipulations, and the only change is in the time of its expiration. Under such circumstances, if there is a change in the conditions or terms of the policy, it is the duty of the insurer to call attention to the change, otherwise the change can be no part of the contract, and the renewal contract is subject to reformation by the courts of equity to make it conform to the original contract, unless there has been an amendment of the contract by enactment of a statute by the Legislature.” (Page 766)

No explanation was given by the defendant to the plaintiff for the issuance of two separate policies to cover the classifications included in P-1 or of any change in the computation of the premiums. All four of the renewal policies (P-2, P-3, P-4 and P-5) contained an endorsement that their premiums were to be computed in accordance with the Three Year Retrospective Plan (D) that formed a part of P — 1. Under the circumstances, the court concludes that the appropriate experience modifications must be applied to the water losses for these policies as well as the other.

The defendant’s alternative plea must also be denied. As pointed out herein-above, the policies state that the premiums shall be computed in accordance with the rating manual. It provides for the filing of losses with the bureau and computation by that organization of the experience modifications which are to be applied to the premiums for the whole policy. This was accomplished before the policies involved in this suit were issued, and the modifiers, as well as the manner in which they were computed by the bureau, were available for defendant’s inspection. The latter has taken no action to revise the losses and change the experience ratings in accordance with the manual. Since the computation and promulgation of the experience modifications are strictly a function of the bureau, the court concludes that such modifications for the respective annual periods covered by the policies involved in this suit as promulgated by the bureau must be applied in this instance.”

On appeal, Argonaut re-urges its position that during negotiations prior to the issuance of its policy it was never intended that the experience modifiers would apply to Hooks’ high risk dredging and tugboat operations, since these maritime risks are not regulated by any statutory rate and are usually determined by negotiation between the parties. Argonaut contends that Hooks is trying to take advantage of two “mistakes”, the first being that Highlands failed to send to the bureau the record of Hooks’ losses in dredging and tugboat operations during the years preceding the issuance of the Argonaut policy, and the second being that for the 1972-1973 policy year, Argonaut issued a single policy covering all water and land risks, rather than dividing the maritime risks and the land risks into two separate policies, as it should have. Argonaut argues that to allow Hooks to take advantage of these two technical “mistakes” would result in an unjust enrichment to Hooks in the sum of approximately $118,-335.

Defendant did not argue unjust enrichment in the trial court. Nevertheless, we find the contention without merit. We agree with the trial judge that the policy, as written, is clear and free of ambiguity. The experience modifications apply to all risks covered by the policy. In effect, Argonaut is asking the court to rewrite the policy, although it has not expressly sought to reform the contract. As the trial judge aptly stated in his written reasons, even if Argonaut were seeking to reform the policy, the evidence does not show that during negotiations prior to its issuance the parties clearly and definitely agreed that the experience modifications would not apply to the over-water risks.

By answer to the appeal, Hooks asserts that it is entitled to recover interest on the excess premiums paid Argonaut, under the provisions of LSA-R.S. 22:637.1 which provides:

“A. Any refund due an insured by an insurer writing or delivering insurance policies excluding health and life insurance, in the state because of either cancellation, elimination, or reduction of coverage by the insurer or the insured, shall be accompanied with interest at the rate of one and one-half percent per month of the amount of the refund due the customer, .. . .”

This statute provides interest only when the coverage of the policy has been decreased, and as a result the insured is entitled to a refund. In the present case, there has been no change in the coverage provided to Hooks. This refund results from an improper computation of premiums, not a cancellation, elimination or reduction of coverage. Consequently, plaintiff’s request for additional interest is denied.

For the reasons assigned, the judgment appealed is affirmed. All costs of this appeal are assessed against the defendant-appellant.

AFFIRMED.


text:
    BANK OF JENA, Plaintiff-Appellant, v. Shirlie F. ROWLEN et al., Defendant-Appellee.
    No. 6891.
    Court of Appeal of Louisiana, Third Circuit.
    April 11, 1979.

      Long & Peters, Jimmie C. Peters, Jena, and Henry M. Bernstein, Baton Rouge, for plaintiff-appellant.
    Gahagan & Wilson, Joseph Wilson; Jena, for intervenors-appellees.
    Hayes, Harkey, Smith & Cascio, Joseph D. Cascio, Jr., and Tom Hayes, III, Monroe, for defendant-appellee.
    Before DOMENGEAUX, SWIFT and DOUCET, JJ.
   SWIFT, Judge.

In 1976 the defendant, Shirlie F. Rowlen, a building contractor, was engaged in the construction of a residential structure on a lot which he owned in Jena, Louisiana. To finance the construction, Rowlen obtained a loan from the plaintiff, Bank of Jena, which was secured by a collateral mortgage on the lot. Rowlen defaulted on this and other obligations, causing this mortgage foreclosure action by the bank in which other creditors intervened seeking a ranking of their liens and privileges. The intervenors alleged they were entitled to be paid in preference to the plaintiff from the proceeds of the sheriff’s sale, by reason of their liens for labor and materials furnished which had been timely and properly filed. It was stipulated that two existing tax liens were to be paid prior to any of the other creditors. The trial judge ruled that all liens for labor and materials primed the bank’s mortgage as well as another collateral mortgage held by Howard Brothers Home Care Center of Monroe, Inc., which concern had also filed a materialman’s lien. The bank has appealed.

In reaching his decision, the district judge concluded that certain materials had been delivered to the site by an employee of Howard Brothers on September 29, 1976. The plaintiff’s collateral mortgage was executed and recorded on October 1, 1976, but its effective date was October 6th when money was first advanced and the mortgage note was pledged. American Bank and Trust Company in Monroe v. F & W Construction, Inc., 357 So.2d 1226 (La.App. 2 Cir. 1978). Therefore, the laborer’s and materialmen’s liens primed the bank’s mortgage. LSA-R.S. 9:4812 and 4819(A)(1).

The trial judge’s determination of this issue was based principally on his factual analysis of the evidence and we agree therewith. Actually, the appellant has not specified in its brief any error in regard to this issue. The bank argues simply that the materialman’s lien of Howard Brothers was waived by its prior acceptance of a collateral mortgage as security for the cost of materials to be furnished for the construction of the building.

We have found no cases which deal precisely with the question presented by the plaintiff. However, in Central Lumber Co. v. Schroeder, 164 La. 759, 114 So. 644 (1927), a materialman, in addition to his properly recorded lien, had accepted notes from the debtor secured by a second mortgage on his property. The materialman had agreed to waive his privilege if a cash payment was made by the debtor on a sum owed to the creditor over and above the amounts set forth in the notes secured by the mortgage. The court ruled that since the debtor never made the contemplated payment, the mate-rialman had not waived his privilege.

In Wardlaw Brothers Garage, Inc. v. Thomas, 140 So. 108, (La.App. 2 Cir. 1932), the court held that a mechanic’s lien was lost by implication since the repairman was not looking to the owner of the automobile for payment of his bill or to his lien as security, but instead was relying on the credit of and monthly payments from the third party causing the damages to the car. The court noted that a lien may be lost only by payment of the claim secured or by waiver expressly agreed to, or by waiver arising by implication from the facts and circumstances of the particular case. That decision was followed by this court in Babineaux v. Grisaffi, 180 So.2d 888 (La.App. 3 Cir. 1965). Neither of these cases, of course, dealt with a materialman’s lien.

While it appears that a material-man’s lien may be waived expressly or by implication where there is a strong factual basis therefor, in the present case there is no indication whatsoever in the record that Howard Brothers intended to waive any security that it might have, either conventional or otherwise, for payment of the price of materials furnished the defendant for construction of the residence on the subject property. Therefore, the plaintiff’s contention in this respect must fall.

For these reasons, the judgment of the trial court is affirmed at appellant’s costs.

AFFIRMED.