text:
    STATE of Louisiana v. Tebbe ARBO.
    No. 80-KA-1435.
    Supreme Court of Louisiana.
    Dec. 23, 1980.

      William J. Guste, Jr., Atty. Gen., Barbara Rutledge, Asst. Atty. Gen., Harry F. Con-nick, Dist. Atty., Robert T. Myers, Louise S. Korns, Asst. Dist. Attys., for plaintiff-ap-pellee.
    Orleans Indigent Defender Program, Thomas J. Ford, Jr., Dwight Doskey, New Orleans, for defendant-appellant.
   PER CURIAM.

Defendant Tebbe Arbo was charged by bill of information with attempted first degree murder, a violation of La.R.S. 14:27 (14:30). On March 13, 1979, she was tried before a twelve person jury, which found her guilty of attempted manslaughter. Thereafter, she was sentenced as a third felony offender, under the provisions of La. R.S. 15:529.1, to serve twenty years at hard labor.

Appointed counsel filed an appeal on her behalf, requesting a review of the record for errors patent on its face pursuant to La.C.Cr.P. art. 920(2). Defendant subsequently filed a pro se brief, expressing her desire to raise additional issues, and was granted an extension of time for that purpose.

ASSIGNMENT OF ERROR

An inspection of the pleadings and proceedings has disclosed no patent errors. Moreover, the objections entered at trial raised insubstantial issues that were properly abandoned on appeal.

In her pro se brief, defendant asserts that she was denied effective assistance of counsel, particularly in regard to counsel’s advice against her testifying in her own defense.

The issue is more properly raised by application for a writ of habeas corpus in the district court, where a full evidentiary hearing may be conducted if warranted. See, State v. Malveaux, 371 So.2d 820 (La.1979); State v. Barnes, 365 So.2d 1282 (La.1978).

Finding no reversible error on the record before us, we affirm defendant’s conviction and sentence.


source: Caselaw Access Project

author: LANDRY, Judge. EDWARDS, Judge.

license: Public Domain

text:
    Elizabeth Thames PIERCE v. The BOARD OF SUPERVISORS OF LOUISIANA STATE UNIVERSITY, etc. et al.
    No. 13017.
    Court of Appeal of Louisiana, First Circuit.
    Oct. 8, 1979.
    On Rehearing March 31, 1980.
    See also La.App., 392 So.2d 465.

      Richard C. Cadwallader, Baton Rouge, for plaintiff-appellant Elizabeth Thames Pierce.
    W. Shelby McKenzie, Baton Rouge, for defendant-appellee The Bd. of Supervisors of Louisiana State University, Etc., et al.
    Before LANDRY, EDWARDS and LEAR, JJ.
   LANDRY, Judge.

This matter is before us on motion of the Board of Supervisors of Louisiana State University and Agricultural and Mechanical College, Martin D. Woodin, President, Baton Rouge Campus, Louisiana State University (L.S.U.), and Paul W. Murrill, Chancellor of L.S.U. (Appellees), to dismiss, as moot, an appeal taken by Plaintiff, Elizabeth Pierce (Appellant), from a judgment dismissing her suit for declaratory judgment and injunctive (or alternatively mandatory) relief.

Appellant has opposed the appeal and has also moved this Court to take testimony and entertain oral argument on Appellees’ motion to dismiss. We deny the request for oral argument and dismiss the appeal.

Mrs. Pierce has been a member of the faculty of the Baton Rouge Campus of L.S.U. for twenty-three years. She presently holds the rank of tenured instructor in the Department of Health, Physical and Recreational Education (HPRE). Mrs. Pierce is not assigned any teaching duties but merely serves as an accompanist during dance instruction. She has continuously expressed dissatisfaction with this limited role and has often requested teaching duties, especially a course in rhythmical analysis (HPRE 4801).

In July, 1977, Dr. Thomas was appointed Chairman of the Department of HPRE and reaffirmed Mrs. Pierce’s assignment as solely an accompanist. Since then, tension between Mrs. Pierce and certain dance instructors heightened and resulted in charges that Mrs. Pierce had become uncooperative. The faculty of the Department of HPRE voted to recommend Mrs. Pierce’s termination for cause. Dr. Thomas informed Mrs. Pierce of this action and of his intention to process the recommendation unless she submitted a written resignation. Mrs. Pierce consequently initiated this proceeding seeking:

(1) A declaratory judgment providing that she cannot be dismissed as a member of the L.S.U. faculty unless a hearing is held in accordance with the Louisiana Administrative Procedures Act and the Open Meetings Law;

(2) A preliminary injunction prohibiting representatives of Louisiana State University from conducting a hearing concerning her dismissal unless that hearing is held in accordance with the Louisiana Administrative Procedure Act and the Open Meetings Law; and alternatively,

(3) A writ of mandamus directing the Board of Supervisors of L.S.U. to conduct a hearing concerning her dismissal pursuant to the provisions of the Louisiana Administrative Procedures Act and the Open Meetings Law or to adopt a general code of administrative procedures before conducting such a hearing.

The Defendant filed an answer denying some of Plaintiff’s allegations, admitting others, and filed exceptions urging prematurity and no cause of action.

The trial judge upheld both of the exceptions and dismissed the suit. Mrs. Pierce timely appealed this judgment.

While this appeal was pending, Dr. Thomas, the Chairman of the Department of HPRE recommended to Paul W. Murrill, the Chancellor of L.S.U. that Mrs. Pierce be terminated for cause. A special committee of the faculty was appointed to conduct a hearing in accordance with Policy Statement 36 of the university which, according to the trial judge, contains minimal due process safeguards for the dismissal of employees. Based on its findings, the special committee recommended that Mrs. Pierce be reassigned rather than terminated for cause. Chancellor Murrill accepted this recommendation and notified Mrs. Pierce of his decision. The following events have transpired concerning Appellant’s proposed reassignment:

A letter dated August 20, 1979, by Paul Koenig, Assistant Vice Chancellor for Academic Affairs, informed Mrs. Pierce’s attorney, Richard C. Cadwallader, that the reassignment options available to Mrs. Pierce were: a research appointment, a semester’s leave with pay, or some other employment within the university; the only likely options for the fall of 1979 being the research appointment and the leave with pay. Another letter, also dated August 20, 1979, by Chancellor Murrill informed Mrs. Pierce that she had been assigned a research position with the Department of HPRE for the fall of 1979. The letter additionally stated that Mrs. Pierce would be under the direction of Dr. Thomas (who had previously recommended her termination) and that she would retain the same salary except for the adjustments recently provided by the Legislature (10 percent increase, % payable during the year). On August 24, 1979, Mrs. Pierce addressed a letter to Chancellor Mur-rill stating that she was not satisfied with the proposed assignment and requested a meeting to discuss some of her suggestions which had been outlined by Mr. Cadwallader in a letter of August 16, 1979.

On August 29, 1979, Mrs. Pierce wrote another letter to Vice Chancellor Koenig stating that “following our conversation of August 28, 1979, I am following your suggestion in requesting administrative leave for the fall of 1979. In addition I [sic] desire that we effect a settlement in writing covering all of the remaining points at issue . . .. ” By letter of August 30, 1979, Vice Chancellor Koenig responded to Mrs. Pierce that if her request for leave was granted, she would then be assigned to full-time research in the Department of HPRE commencing in the spring of 1980, under the direction of Dr. Thomas.

Appellees contend that since termination proceedings against Mrs. Pierce have been concluded in her favor; that she has not been dismissed; and, that she no longer endures the threat of dismissal, the issues raised in her action have become moot. In support of this contention, Appellees have placed of record an affidavit by Chancellor Murrill stating that the termination process against Appellant has been concluded and that the committee recommendation to reassign Appellant has been approved by Chancellor Murrill and that Appellant will be reassigned rather than dismissed.

Appellant urges that her failure to reach a mutual agreement with the university concerning the nature of the reassignment prevents her demand for injunctive or alternatively mandatory relief from becoming moot. We disagree. Appellant’s petition seeks injunctive and declaratory relief in contemplation of Mrs. Pierce’s dismissal from the L.S.U. faculty. The necessity for this relief has been obviated by Appellees’ judicial confession admitting that Mrs. Pierce will not be dismissed but merely reassigned and by Mrs. Pierce’s implied assent to reassignment as indicated by the above-mentioned negotiations. Furthermore, the issue of whether Mrs. Pierce has been denied certain rights in the negotiation of her reassignment was not presented to the trial court and consequently cannot, at this time, be addressed by this Court.

Appellant additionally argues that regardless of whether an agreement is reached concerning her reassignment, a viable issue is presented by the second facet of Mrs. Pierce’s petition seeking declaratory judgment of her contract right to appeal to the Board of Supervisors and of the specific due process procedures applicable to the Board of Supervisors in connection with a hearing and whether such hearing would be a public hearing. We also disagree with this contention. We have reviewed the record and the briefs and cannot conclude that Appellant made any demands for declaratory judgment independent of the pending threat of Mrs. Pierce’s dismissal. Since the threat of dismissal has been withdrawn, the demand for declaratory judgment related thereto is also moot. State v. Ward, 259 La. 317, 249 So.2d 921 (1971).

Since there no longer exists a justiciable controversy as to Appellant’s dismissal, a declaratory judgment of Appellant’s contractual rights in case of dismissal would only amount to an expression of opinion which is beyond the scope of our judicial authority. Stoddard v. City of New Orleans, 246 La. 417, 165 So.2d 9 (1964).

There being only a moot question before this Court, the appeal is dismissed. It is also ordered that Appellant’s motion requesting this Court to take testimony and entertain oral argument on Appellees’ motion to dismiss is denied. All costs of this appeal are to be paid by Plaintiff-Appellant.

APPEAL DISMISSED.

EDWARDS, Judge.

ON REHEARING

In her original petition against LSU, Mrs. Pierce prayed for:

1. A declaratory judgment that plaintiff could not be dismissed without hearings conducted as required by the Administrative Procedures Act, R.S. 49:951-966.
2. A declaratory judgment that all hearings held by LSU be public pursuant to R.S. 42:4.1-4.10 [42:4.1-42:10] and Art. XII, Sec. 3 of the Louisiana Constitution of 1974.
3. A declaratory judgment that only the Board of Supervisors of LSU had the authority to terminate plaintiff and only if hearings providing full due process protection were conducted.
4. A preliminary injunction restraining LSU or its agents from conducting dismissal hearings relative to the plaintiff unless such hearings were conducted pursuant to R.S. 49:951-966, R.S. 42:4.1-4.10 [42:4.1-42:10] and Art. XII, Sec. 3 of the Louisiana Constitution of 1974.

Alternatively, Mrs. Pierce prayed for:

5. A writ of mandamus instructing LSU that if dismissal hearings regarding Mrs. Pierce were to be instituted in a manner not pursuant to R.S. 49:951-966, R.S. 42:4.1-4.10 [42:4.1-42:10] and Art. XII, Sec. 3 of the Louisiana Constitution of 1974, then LSU should show cause why they should not adopt a general code of administrative procedures to govern hearings involving faculty termination and should defer termination proceedings against Mrs. Pierce until such code be adopted.
6. Final judgment perpetuating either the preliminary injunction or the writ of mandamus.

LSU answered and filed exceptions of prematurity and no cause of action. After a hearing on the rule for a preliminary injunction, both defendant’s exceptions were sustained. Mrs. Pierce filed a timely devolutive appeal.

On August 15, 1979, LSU filed a motion to dismiss Mrs. Pierce’s appeal on the ground of mootness. The factual support for LSU’s motion was a series of documents and communications, all of which came into existence after the trial court ruling which is on appeal. LSU stoutly maintains that this new evidence amounts to a judicial admission by LSU that Mrs. Pierce will not be dismissed but will only be reassigned. Therefore, LSU argues, this court can grant no relief to Mrs. Pierce, all issues raised by plaintiff’s original petition are moot, and plaintiff’s appeal should be dismissed.

The documents and communications proffered by LSU as the basis for its motion to dismiss were erroneously taken into consideration by this court on first hearing. Such documents, including the affidavit sworn to by Chancellor Paul Murrill on August 27, 1979, amount to new evidence.

It is a long established principle that appellate courts may not receive new evidence. Leger v. Delano Plantation, Inc., 352 So.2d 743 (La.App. 3rd Cir. 1977); Salter Bus Lines, Inc. v. Leitch, 322 So.2d 793 (La.App. 3rd Cir. 1975); Gallagher v. Gallagher, 248 La. 621, 181 So.2d 47 (1965); Boucher v. Division of Employment Security, Department of Labor of State of Louisiana, 235 La. 851, 106 So.2d 285 (1958); Stevens v. Johnson, 230 La. 101, 87 So.2d 743 (1956); Tatum v. Andrews, 165 La. 222, 115 So. 466 (1928); Beard v. Poydras, 3 Mart. (O.S.) 505 (1814).

In the Tatum case, after answering the appeal, appellee sought to introduce proof that, after trial, plaintiff had recovered on afn insurance policy. Appellee attached a certified copy of a U.S. District Court judgment against the insurance company. The Louisiana Supreme Court would not, on appeal, admit even this type of evidence.

There is an exception to the rule against appellate courts admitting evidence. The rule does not apply where facts subsequent to trial are not disputed and are admitted. Boucher v. Division of Employment Security, Department of Labor of State of Louisiana, supra; Wilson v. Wilson, 205 La. 196, 17 So.2d 249 (1944); Tatum v. Andrews, supra. In this case, there has been no joint stipulation of facts. Therefore, no new evidence may be considered.

There has been no admission by Mrs. Pierce that her current employment is identical with the past, an admission which, taken alone, would allow a finding of mootness. Kennedy v. Soule, 42 So.2d 101 (La.App. 1st Cir. 1949). Rather, Mrs. Pierce’s claim concerns present and future attempts to end her career.

Nor can this court take judicial notice of the proffered series of communications. Disputed facts, or at the very least, statements as to which there has been no clear agreement, are not in the same vein as the laws of nature, geographic and historical facts, time, the calendar, laws and other matters of common knowledge. Judicial notice is a substitute for, and equivalent of, evidence, and facts should not be “noticed” unless otherwise admissible. Dimm v. Granier, 284 So.2d 850 (La.App. 4th Cir. 1973). The resolution of disputed issues of material fact by judicial notice of the correct determination is improper. Acadia-Vermilion Rice Irrigating Company v. Broussard, 185 So.2d 908 (La.App. 3rd Cir. 1966).

This case rests exactly where it did at the conclusion of the trial court proceedings. Mrs. Pierce has an appeal of right. LSA-C. C.P. 2082.

In the trial court, Mrs. Pierce sought relief which was denied and suffered a judgment sustaining LSU’s exceptions of prematurity and no cause of action and dismissing plaintiff’s suit. On appeal, the correctness of those rulings and dismissal is at issue. The Court of Appeals will decide whether or not, as a tenured LSU faculty member, Mrs. Pierce has the right to ascertain exactly what procedures will be used in any decision-making process which may end her career. Whether plaintiff’s suit was premature or not will also be at issue.

Should this court, on appeal, feel a need for additional evidence, remand for the taking of such evidence by the trial court will be available. Shaw v. Louisiana Department of Education, 366 So.2d 1070 (La.App. 3rd Cir. 1979); Wagner v. Fo-Coin Co., 350 So.2d 265 (La.App. 4th Cir. 1977); Gallagher v. Gallagher, supra; Fontenot v. Derbonne, 236 La. 761, 109 So.2d 85 (1959); Millaudon v. The First Municipality of New Orleans, 1 La.Ann. 215 (1846).

For the foregoing reasons, the previous granting of the motion to dismiss for mootness is annulled and reversed and the motion to dismiss is denied.

MOTION DENIED.


author: EDWARDS, Judge.

text:
    Elizabeth Thames PIERCE v. The BOARD OF SUPERVISORS OF LOUISIANA STATE UNIVERSITY and Agricultural and Mechanical College; Martin D. Woodin, President of Louisiana State University System; and Paul W. Murrill, Chancellor, Baton Rouge Campus, Louisiana State University and Agricultural and Mechanical College.
    No. 13017.
    Court of Appeal of Louisiana, First Circuit.
    Oct. 6, 1980.
    Rehearing Denied Dec. 15, 1980.
    See also La.App., 392 So.2d 460.
    John Fichtel, III, and Richard C. Cadwal-lader, Baton Rouge, for plaintiff-appellant Elizabeth Thames Pierce.
    W. Shelby McKenzie, Baton Rouge, for defendant-appellee The Bd. of Supervisors of Louisiana State University, Etc., et al.
    Before LOTTINGER, EDWARDS and PONDER, JJ.
   EDWARDS, Judge.

Elizabeth Thames Pierce, a tenured faculty member with twenty-three years experience, brought suit against the Board of Supervisors of Louisiana State University and Agricultural and Mechanical College, Martin D. Woodin, President, and Paul W. Murrill, Chancellor of the Baton Rouge campus, hereinafter collectively LSU.

Mrs. Pierce prayed for:

1. A declaratory judgment that plaintiff could not be dismissed without hearings conducted as required by the Administrative Procedures Act, R.S. 49:951-966.
2. A declaratory judgment that all hearings held by LSU be public pursuant to R.S. 42:4.1-42.10 and Art. XII, Sec. 3 of the Louisiana Constitution of 1974.
3. A declaratory judgment that only the Board of Supervisors of LSU had the authority to terminate plaintiff and only if hearings providing full due process protection were conducted.
4. A preliminary injunction restraining LSU or its agents from conducting dismissal hearings relative to the plaintiff unless such hearings were conducted pursuant to R.S. 49:951-966, R.S. 42:4.1-4.10 and Art. XII, Sec. 3 of the Louisiana Constitution of 1974.

Alternatively, Mrs. Pierce prayed for:

5. A writ of mandamus instructing LSU that if dismissal hearings regarding Mrs. Pierce were to be instituted in a manner not pursuant to R.S. 49:951-966, R.S. 42:4.1-4.10 and Art. XII, Sec. 3 of the Louisiana Constitution of 1974, then LSU should show cause why they should not adopt a general code of administrative procedures to govern hearings involving faculty termination and should defer termination proceedings against Mrs. Pierce until such code be adopted.
6. Final judgment perpetuating either the preliminary injunction or the writ of mandamus.

LSU answered and filed exceptions of prematurity and no cause of action. After a hearing on the rule for a preliminary injunction, both defendant’s exceptions were sustained. Mrs. Pierce filed a timely devolutive appeal.

LSU filed a motion to dismiss the appeal for mootness. The motion’s basis was a series of documents and communications, all of which came into existence after the trial court ruling.

At first, this court erroneously took the documents into consideration and granted LSU’s motion to dismiss. On rehearing, we adhered to the long established principle that appellate courts may not receive new evidence, reversed ourselves arid denied the motion to dismiss.

For two reasons, we denied LSU’s subsequent motion to remand for the taking of further evidence. First, because Mrs. Pierce remained a faculty member and was negotiating with LSU over her status, new evidence which might change the posture of her case would not be conclusive and might lead to possible future repeated requests for remand which would delay a final determination on the merits. Second, the only real issue was whether, based on the facts as they stood at the time of judgment, the trial court’s sustaining of LSU’s exceptions of prematurity and no cause of action was proper.

Before we could hear the appeal on its merits, Mrs. Pierce died. Her legal representatives, A. Clay Pierce, Jr., and Mrs. Caroline Pierce Cooper, were made parties appellant.

LSU filed a motion to dismiss the appeal on the ground that plaintiff-appellant’s action abated at her death. Since the motion was filed only four days before oral argument on the merits was scheduled, both issues were heard together. We find that plaintiff-appellant’s action abated with her death and that her legal representatives have no independent standing to contest the suit. Therefore the appeal is dismissed.

Appellants urge that the suit consists of two separate causes of action:

1) a private action, some elements of which are strictly personal and therefore abated at plaintiff’s death and some which are not strictly personal and which may be pursued by plaintiff’s legal representatives under the authority of LSA-C.C.P. Art. 428, which provides
“An action does not abate on the death of a party. The only exception to this rule is an action to enforce a right or obligation which is strictly personal.”
2) a taxpayers’ action, bearing upon the public interest regarding the obligation of LSU and brought by plaintiff as a representative of all taxpayers.

Appellants list six widely ranging and possibly financial matters, allegedly heritable, which “could be” affected by a decision on the merits. Mrs. Pierce sought relief in none of these matters. Whatever claims plaintiff had, or her heirs may still have, in these areas, is in no way affected by abatement of this action. The only relief sought by plaintiff was declaratory, injunctive and mandatory. Her purely personal interest in such relief died with her.

Appellants’ argument that they represent plaintiff in a taxpayers’ action is without merit. Mrs. Pierce brought no suit as a taxpayer. Furthermore, even if Mrs. Pierce, because of her employment at LSU, had personal standing to bring such an action, her heirs, as mere taxpayers, clearly do not.

Absent a special and individual interest, a citizen, though a taxpayer, has no standing to champion a cause pertaining to the population at large. Governmental institutions in general, and in this case, LSU in particular, may not be forced to defend broad and open-ended actions such as the present one, on the basis that some taxpayer, any taxpayer, wants to know what the institution’s duties would be in a future and purely hypothetical case. League of Women Voters of New Orleans v. City of New Orleans, 381 So.2d 441 (La.1980).

The motion to dismiss is sustained. Plaintiff-appellant’s suit is hereby dismissed. All costs of these proceedings, both trial and appellate, are to be paid by A. Clay Pierce, Jr., and Mrs. Caroline Pierce Cooper.

APPEAL DISMISSED.

      . 392 So.2d 460 (La.App. 1st Clr. 1979).

      . Docket No. 13,017 (La. App. 1st Cir. March 31, 1980).

      . The issue of whether a Louisiana taxpayer, as such, absent a special interest, has standing to sue a governmental institution, seems unsettled. League of Women Voters, supra, appears to conflict with and overrule the following: Stewart v. Stanley, 199 La. 146, 5 So.2d 531 (1941); Woodard v. Reily, 244 La. 337, 152 So.2d 41 (1963); Upper Audubon Association v. Audubon Park Commission, 329 So.2d 206 (La. App. 4th Cir. 1976), writ denied 333 So.2d 240 (La. 1976). Whether a Louisiana taxpayer must meet the two-pronged test of Flast v. Cohen, 392 U.S. 83, 88 S.Ct. 1942, 20 L.Ed.2d 947 (1968), or whether the taxpayer’s hurdle is lower, and, if so, to what degree, is not certain. What is certain is that under League of Women Voters, the Louisiana Supreme Court’s latest pronouncement on the subject, appellants do not have standing.


author: LEMMON, Judge. SARTAIN, Judge.

text:
    Shirley McNAMARA, Secretary of the Department of Revenue and Taxation, State of Louisiana v. FIRST COMMERCE CORPORATION.
    No. 10249.
    Court of Appeal of Louisiana, Fourth Circuit.
    Feb. 20, 1980.
    On Rehearing Jan. 13, 1981.

      Riley F. Boudreaux, Jr., Baton Rouge, for plaintiff-appellant.
    Usry, Leefe & Weeks, New Orleans, for defendant-appellee.
    McCollister, McCleary, Fazio, Mixon, Hol-liday & Hicks, D. Irvin Couvillion and James S. Holliday, Jr., Baton Rouge, for Great American Corp., amicus curiae.
    Jones, Walker, Waechter, Poitevent, Carrere & Denegre, A. J. Waechter, Jr., Thomas C. Keller, Robert R. Casey and Rudolph R. Ramelli, New Orleans, for New Orleans Bancshares, Inc., amicus curiae.
    Broadhurst, Brooks, Miller & Reed, William C. Broadhurst, Lafayette, for First Nat. Bank of Lafayette, amicus curiae.
    Monroe & Lemann, Malcolm L. Monroe, John D. Wogan, Lynn M. Allain, New Orleans, for Whitney Holding Corp. and Jena Bancshares, Inc., amicus curiae.
    Kantrow, Spaht, Weaver & Walter, Lee C. Kantrow, Baton Rouge, for Fidelity Nat. Financial Corp., amicus curiae.
    Blossman & Hand, Jack A. Blossman, Covington, for First Nat. Corp., amicus curiae.
    Landry & Landry, Jules F. Landry, Baton Rouge, for Feliciana Commerce Corp. and Capital Bancshares, Inc., amicus curiae.
    Talley, Anthony, Hughes & Knight, Richard F. Knight, Bogalusa, for Parish Nat. Corp., amicus curiae.
    Gaidry & LaRussa, Edward James Gaid-ry, Houma, for Terrebonne Corp., amicus curiae.
    Before SAMUEL, LEMMON and GARRISON, JJ.

       SARTAIN, J., appointed to fill the vacancy created by the election of Justice Lemmon to the Louisiana Supreme Court.

   LEMMON, Judge.

First Commerce Corporation (FCC), a corporation which owns virtually all of the shares of First National Bank of Commerce in New Orleans, derives income from dividends on that national bank stock, as well as from other sources. In this action to collect Louisiana state income tax for 1973 and 1974 on FCC’s income from its national bank shares, FCC resists payment on the grounds (1) that national bank dividends, although then taxable by a state, had not been subjected to taxation by the Louisiana Legislature after Congress removed a previous obstacle to such taxation (notwithstanding R.S. 47:42 A’s long-standing taxation of “dividends”); (2) that all of FCC’s own income was exempted by R.S. 47:8 from taxation; and (3) that equal protection of the law requires treating FCC like corporations exempted by R.S. 47:8. We disagree on all issues, and we therefore reverse the trial court’s judgment.

I

By R.S. 47:42 A and its forebears, Louisiana has since 1934 imposed a tax on income, including income from “dividends”. But Louisiana had since 1878 expressly imposed an ad valorem tax on the shares of national banks “doing a banking business in this state” (see R.S. 47:1967), and federal law (12 U.S.C. § 548 and its forebears) prohibited a state from imposing both ad valorem and income taxation. Louisiana’s tax collector therefore opined in 1935 that national bank dividends were exempt from state income tax notwithstanding the state’s taxation of “dividends”.

Dividends of state banks, on the contrary, were taxed as “dividends” until 1966 when R.S. 47:8 was enacted, limiting taxation of state bank shareholders to the taxes payable by national bank shareholders.

12 U.S.C. § 548 was amended in 1969 to provide that, for federal and state tax purposes after January 1, 1973, “a national bank shall be treated as a bank organized and existing under the laws of the State” of its principal office. Louisiana’s Legislature passed no new statute in response to the federal change, but state tax officials took the position that, after January 1, 1973, “dividends” taxed by Louisiana’s existing statute included dividends from national bank shares.

FCC argues that the Louisiana Legislature did not intend to include national bank dividends among “dividends” taxed when R.S. 47:42 A was first enacted, because such dividends were then exempt by operation of federal law from state income tax. On this premise FCC further contends that taxation of national bank dividends, after the exemption was removed by amendment of federal law in 1973, required an Act of the Legislature, rather than the simple administrative application of an Act long in existence.

The broad, inclusive definition of gross income in R.S. 47:42 A evidently intended to tax all that it could, including among “dividends” those from state and national banks. Furthermore, the deliberate wording of R.S. 47:8, enacted in 1966 to end the unfair and unequal treatment of state bank shareholders, provides not that state bank dividends are not included in “dividends”, nor even that they are exempt, but rather that state banks and their shareholders “shall be subject to the payment of all taxes of the State of Louisiana ... in the same manner as national banking corporations doing business in Louisiana and their shareholders are taxed by the State of Louisiana . . . under the laws and regulations of the United States of America and the State of Louisiana.” The Louisiana Legislature thus yielded on collection of taxes from state banks only to the extent that federal law prohibited the collection of more than one tax in respect to national banks and their shareholders.

It is reasonable to conclude that the Louisiana Legislature originally intended to tax all the income its taxing power could reach. Indeed, it is unthinkable that the Louisiana Legislature in taxing “dividends” intended to tax state bank dividends but not national bank dividends, notwithstanding that it may then have recognized (and by its 1966 enactment of R.S. 47:8 did recognize) that federal law prevented collecting the tax on national bank dividends. The Louisiana situation from 1966 to 1973 was that the Legislature imposed a tax on all dividends, but since federal law exempted national bank dividends, the Louisiana Legislature, on the basis of fundamental fairness and without ever withdrawing its taxation of “dividends”, provided that state banks be taxed no more than national banks. Thus, the Louisiana Legislature’s express taxation of “dividends” was simply suspended as to both national and state bank dividends exclusively because of a federal law obstacle. When that obstacle was removed, the suspension of Louisiana’s taxation of bank dividends ended, effective January 1, 1973. Presumably, every other recipient of national bank dividends in the state (with one stipulated exception) has paid Louisiana state income tax in respect to those dividends. So should FCC, unless its own income is exempt from taxation under R.S. 47:8.

II

R.S. 47:8 affords no exemption to FCC because, as is stipulated, FCC’s income is not “derived solely” from its national bank shares.

The declared purpose of R.S. 47:8 (which is applicable to all forms of state taxation) was to put state banks and bank stock holding corporations and their shareholders on the same footing for all tax purposes with national banks and their shareholders. But the purpose cannot then have been to preserve from income tax the pure bank holding corporation the statute describes, because such a corporation would already owe no income tax: all its income was already tax-free because it was derived solely from non-taxed dividends from bank shares and from tax-exempt securities. The inclusion of holding companies preserved them from other taxes, but it was their shareholders who required exemption from state income tax. Without R.S. 47:8, non-taxable bank dividends would have become taxable holding company dividends when passed from the bank through the holding company to the ultimate shareholders.

As surely as the Legislature by R.S. 47:8 intended to avoid that consequence, it did not intend to allow all corporations to escape income and other taxation by buying a share of bank stock. A line had to be drawn and it was drawn, clearly and unmistakably: to achieve the advantageous tax status of a national bank, the corporation’s income had to be “derived solely from banking corporations and securities exempt from [state] taxation.” A bank holding company could own bank shares, bank accounts and tax-exempt bonds, but could derive income from no other source. FCC chose to derive income from other sources and thus has crossed the line dividing corporations that own bank stock into those that pay and those that do not pay income tax.

Ill

FCC argues that it is denied equal protection of the law by being categorized with all other shareholders rather than with Hibernia Corporation, which, it is stipulated, was accorded the tax status of a bank because its income is “derived solely” from its shares of Hibernia National Bank.

This complaint is like that of a corporation denied federal Subchapter S tax treatment because it has one more shareholder than permitted by 26 U.S.C. § 1372. As we have already observed, a legislative body must draw a line at some point. The federal Subchapter S line is drawn at 15 shareholders; Louisiana’s bank holding company line is drawn at companies who do nothing but hold bank shares or otherwise derive income from banks (and tax-exempt securities). The Louisiana law allows a company that is a pure conduit to treat its income as that of its shareholders, much as any law might allow a nominee or agent to attribute his apparent income to its beneficial owner. By doing so, the Louisiana law does not discriminate unreasonably against another company (Commerce) which is part conduit and part independent commercial enterprise.

Perhaps it might have been as reasonable for Louisiana to allow every corporation that holds any stock in any other corporation to treat income from the stock it holds as income of the holder’s own shareholders. But the constitutional test is not whether the legislative categorization could not be improved upon.

The test is only whether the statutory classification is “supported by [some] rational basis reasonably related to the governmental interest sought to be advanced”, Succession of Robins, La., 349 So.2d 276, 280 (1977), and bears “some rational relationship to a legitimate state purpose”, (Weber v. Aetna Cas. & S. Co., 406 U.S. 164, 92 S.Ct. 1400, 31 L.Ed.2d 768 (1972). The facilitating of bank holding companies, to afford greater banking service flexibility and capacity, without any threat that concentrated banking power might then take over some other area of commerce or industry, is a legitimate state purpose served reasonably by the statute.

The judgment of the trial court is reversed, and there is judgment for plaintiff in the stipulated amount of $133,047.80 for 1973, and $98,736.96 for 1974, with 12% interest from date due until paid, with all costs.

REVERSED AND RENDERED

ON REHEARING

Before SAMUEL, GARRISON and SAR-TAIN, JJ.

SARTAIN, Judge.

We granted a rehearing in this cause to reconsider our original determination that dividends from national bank stock constitute taxable income to the parent holding company of the bank for state income tax purposes.

The facts, which were submitted to the trial court on stipulation, are not in dispute.

The State seeks additional income taxes from First Commerce Corporation (FCC) for the years 1973 and 1974 on dividends received by the latter on its shares of stock in its wholly-owned subsidiary, First National Bank of Commerce, New Orleans, Louisiana. From a judgment rejecting its demands the State appealed. We affirm.

The State relies on R.S. 47:42 A which defines “Gross Income” for income tax purposes as follows:

“ ‘Gross income’ includes gains, profits, and income derived from salaries, wages, or compensation for personal service, of whatever kind and in whatever form paid, or from professions, vocations, trades, businesses, commerce, or sales, or dealing in property, whether real or personal, growing out of the ownership or use of or interest in such property; also from interest, rent, dividends, securities, or the transaction of any business carried on for gain or profit, or gains or profits and income derived from any source whatever.”

FCC opposes the tax on the basis that the State, without implementing legislation, cannot now in view of prior federal restrictions impose an income tax on dividends received from national bank stock.

A resolution of this dispute necessitates an understanding and consideration of the pertinent statutes, federal and state, relating to state taxation of national banks in general and on their dividends in particular.

In the very beginning the United States Supreme Court in the landmark case of McCullogh v. Maryland, 4 Wheaton 316, 4 L.Ed. 579 (1819) held that it was not within the power of a state to tax a national bank on any basis whatsoever. In 1864, pursuant to Act of June, 1864, Ch. 106, Section 41,13 Stat. Ill, Congress granted the states the authority to levy an ad valorem property tax on national bank shares. No other tax was permitted. The Act of 1864 remained unchanged until 1923 when Congress enacted Act of March 4, 1923, Ch. 267, 42 Stat. 1499, which permitted a state to tax (1) said shares (ad valorem), or (2) dividends in the taxable income of an owner or holder thereof, or (3) the net income of such associations, with the provision that, “The imposition by said state of any one of the above three forms of taxation shall be in lieu of the others.” In 1926 the Act was further amended to permit a tax (4) according to or measured by the net income of such associations. This latter amendment continued in effect the limitation that the imposition of any one of the above taxes was in lieu of any of the other three taxes. These statutes were the source statutes of 12 U.S.C. § 548. For an extensive review of the federal statutes and jurisprudence relative to state taxation of national banks, see First Agricultural Nat. Bank v. State Tax Com’n., 392 U.S. 339, 88 S.Ct. 2173, 20 L.Ed.2d 1138 (1968). See also 127 A.L.R. 919, 944; 51 Am.Jur. 254, et seq. (265).

In 1878 Louisiana enacted its first ad valorem tax statute. Act No. 8 of 1878, Ex.Sess., Sect. 1, par. 8. This statute is the forerunner of R.S. 47:1967-1970. It is undisputed that since 1878 and until 1973 and in view of the limitation placed on the state by the federal statutes noted above, Louisiana collected only ad valorem taxes on national bank stock.

Louisiana’s income tax was initiated by Act 21 of 1934. Section 1 of the act is identical to the language now found in R.S. 47:42(A), above. Although the act has been amended on four subsequent occasions, this particular section has remained unchanged. Notwithstanding the broad general language of Section 1, the act was amended the following year by Act 21 of 1935, 1st Ex.Sess., to exclude, inter alia, national banks. Section 27(2) of the act is now R.S. 47:121(2), and it reads as follows:

“The following organizations shall be exempt from taxation under this chapter:
# # * * * *
“(2) Mutual savings banks, national banking corporations and banking corporations organized under the laws of the State of Louisiana who pay a tax for their shareholders or whose shareholders pay a tax on their shares of stock under other laws of this state, and building and loan associations; * * * ” (emphasis ours)

The 1935 amendment was an obvious attempt by the legislature to have our own income tax statute conform to existing federal legislation and jurisprudence.

With the adoption of Act 21 of 1934 the state commenced the income taxation on dividends derived from state bank stock and continued to do so until 1966 when R.S. 47:8 was enacted. This statute reads as follows:

“Banking corporations organized under the laws of Louisiana and other corporations whose income is derived solely from banking corporations and from securities exempt from taxation by the State of Louisiana and shareholders of such banking corporations shall be subject to the payment of all taxes of the State of Louisiana and any subdivision thereof in the same manner as national banking corporations doing business in Louisiana and their shareholders are taxed by the State of Louisiana and any subdivision thereof under the laws and regulations of the United States of America and the State of Louisiana, and in no other manner.” (Emphasis ours)

Thus ended the disparity that existed between dividends derived from national and state bank stock vis ■ a vis state income taxation. State bank stock dividends were no longer subject to such taxes.

In 1969 Congress amended R.S. § 5219, now 12 U.S.C. § 548, as follows:

“(a) Section 5219 of the Revised Statutes (12 U.S.C. 548) is amended to read:
“SEC. 5219. For the purposes of any tax law enacted under authority of the United States or any State, a national bank shall be treated as a bank organized and existing under the laws of the State or other jurisdiction within which its principal office is located.
“(b) The amendment made by subsection (a) becomes effective on January 1,1972.”

The saving clause of the act provided:

“(a) Except as provided in subsection (b) of this section, prior to January 1, 1972, no tax may be imposed on any class of banks by or under authority of any State legislation in effect prior to the enactment of this Act unless
“(1) the tax was imposed on that class of banks prior to the enactment of this Act, or
“(2) the imposition of the tax is authorized by affirmative action of the State legislature after the enactment of this Act.
“(b) The prohibition of subsection (a) of this section does not apply to
“(1) any sales tax or use tax complementary thereto,
“(2) any tax (including a documentary stamp tax) on the execution, delivery, or recordation of documents, or
“(3) any tax on tangible personal property (not including cash or currency), or for any license, registration, transfer, excise of other fee or tax imposed on the ownership, use or transfer of tangible personal property,
“imposed by a State which does not impose a tax, or an increased rate of tax, in lieu thereof.”

The effective date of the act was later changed to January 1,1973. Pub.L. 92-213, § 4(a), Dec. 22, 1971, 85 Stat. 775.

The congressional history of the amendment clearly reflects that the Congress was cognizant of the statutes in many of the states, such as our own, and the disarray and confusion that would result in the immediate removal of the federal limitations. The four year delay in the effective date of the amendment (1969-1973) was to enable the states to take appropriate legislative steps to avoid and/or minimize the problem. Our legislature has taken no such action and the question presented here is whether our prior laws on the subject permit the tax now sought to be imposed by the State. For reasons hereinafter stated we hold that they do not.

The State contends that the broad language of R.S. 47:42(A), above, evidences a legislative intent to levy an income tax on all possible sources of income. While it concedes that until 1973 it was prohibited from taxing dividends derived from national bank stock, it now reasons that with the removal of the prior federal limitation the full import of the statute [R.S. 47:42(A)] is applicable.

The State further contends that R.S. 47:8, above, clearly grants a “contingent” exemption to certain corporations and was “also an indication that the Legislature was looking forward to the day when national banks could be treated as state banks.” We fail to detect any such indication. The clear meaning of the statute is to the effect that by taxing state banks the same as national banks no income tax would be imposed on state banks because prior state law [R.S. 47:121(2)] specifically and federal law prohibited the same.

Under the State’s present interpretation of R.S. 47:8, the State will not levy an income tax on state or national banks, dividends on state and national bank stock in the hands of the holders thereof where the ad valorem tax is paid (R.S. 47:1967 et seq.), or state and national bank holding companies whose sole income is from banking operations; but will, as here, include as taxable income dividends received by state and national bank holding companies whose income is also derived from other sources. These latter corporations previously paid income taxes on their other sources of income but their dividends on state and national bank stock were excluded from their gross income. FCC is one of these latter holding companies.

FCC submits (1) that R.S. 47:42(A), above, absent supplemental legislation, cannot now serve as statutory authority for the imposition of state income taxes; (2) that its income from national bank stock should continue the exemption it previously enjoyed under R.S. 47:8, above; and (3) that equal protection of the law requires that it be treated the same as other banking corporations.

We choose to resolve the issue by determining that R.S. 47:42(A), above, as intended by the Legislature did not include in its definition of “Gross Income” dividends derived from National bank stock. Accordingly, it is not necessary that we address the remaining two objections raised by FCC.

The function of the Court in interpreting a given statute, notwithstanding its broad and comprehensive language, is to ascertain legislative intention and to give effect to that intention. Hayden v. Torrence, 355 So.2d 1362 (La.App. 1st Cir. 1978), writ refused 357 So.2d 1166, La., 357 So.2d 1169 (La.1978); Bonnette v. Karst, 261 La. 850, 261 So.2d 589 (La.1972); In re Hibernia Bank & Trust Co., 185 La. 448, 169 So. 464 (1936); Anderson v. West, 354 So.2d 636 (La.App. 1st Cir. 1977). Laws, like contracts, are to be construed in light of conditions as they existed at the time of their enactment. Tennessee Gas Transmission Co. v. Violet Trapping Co., 248 La. 49, 176 So.2d 425 (1965).

Were there any doubt in our minds that the legislature did not intend to include dividends from national bank stock in the definition of gross income by the Act of 1934 [R.S. 42(A)] that doubt is totally removed by the Act of 1935,1st Ex.Sess. [R.S. 47:121(2)] which specifically excluded “national banking corporations” and shareholders who pay a “tax on their shares of stock under other laws of this state”, namely ad valorem. R.S. 47:121(2) remains a viable statute of this state on the subject and its repeal cannot be effected by implication. Gulf Oil Corporation v. State Mineral Board, 317 So.2d 576 (La.1975).

We think it would be very unsound statutory construction to attach to a statute an intention based on some future contingency, namely the withdrawal of the federal limitation, where the statute itself does not expressly set forth the contingency. The legislature is presumed to know the existing law and the effect of its own legislation. In our opinion the legislature manifested a knowledge of the federal limitations and the alternatives available to it when it adopted the general income tax statute in 1934, amended it to exclude national banks in 1935, and has not addressed itself to the issue since.

At stake is the effect the State’s position will have on the entire banking industry within the state. It is a matter that truly addresses itself to the legislature.

For these reasons our original judgment is recalled and vacated and the judgment of the district court is affirmed. All such costs as are permitted by law are to be borne by the state.

AFFIRMED.

      . Prior to its 1969 amendment, 12 U.S.C. § 548 provided:
      “The legislature of each State may determine and direct, subject to the provisions of this section, the manner and place of taxing all the shares of national banking associations located within its limits. The several States may (1) tax said shares, or (2) include dividends derived therefrom in the taxable income of an owner or holder thereof, or (3) tax such associations on their net income, or (4) according to or measured by their net income, provided the following conditions are complied with:
      “1. (a) The imposition by any State of any one of the above four forms of taxation shall be in lieu of the others ....

      . State banks’ own income (like national banks’ own income) was exempted from income tax, if another tax was paid on the shares by R.S. 47:121(2) and its forebears, in effect since 1935. R.S. 47:121(2) provides:
      “Mutual savings banks, national banking corporations and banking corporations organized under the laws of the State of Louisiana who pay a tax for their shareholders or whose shareholders pay a tax on their shares of stock under other laws of this state, and building and loan associations”.

      . After the 1969 amendment, 12 U.S.C. § 548 provided:
      “For the purpose of any tax law enacted under authority of the United States or any State, a national bank shall be treated as a bank organized and existing under the laws of the State or other jurisdiction within which its principal office is located”.

      . Except for the history of federal limitations on state taxation of national banks, reviewed in First Agricultural Nat. Bank v. State Tax Commission, 392 U.S. 339, 88 S.Ct. 2173, 20 L.Ed.2d 1138 (1968), there could be no argument that R.S. 47:42 A’s taxation of “dividends” does not tax national bank dividends, and R.S. 47:8’s protection of state banks from taxes higher than those allowable on national banks perhaps would not exist.

      . R.S. 47:42 A defines gross income as follows:
      “ ‘Gross income’ includes gains, profits, and income derived from salaries, wages, or compensation for personal service, of whatever kind and in whatever form paid, or from professions, vocations, trades, businesses, commerce, or sales, or dealing in property, whether real or personal, growing out of the ownership or use of or interest in such property; also from interest, rent, dividends, securities, or the transaction of any business carried on for gain or profit, or gains or profits and income derived from any source whatever.”

      . R.S. 47:8 provides:
      “Banking corporations organized under the laws of Louisiana and other corporations whose income is derived solely from banking corporations and from securities exempt from taxation by the State of Louisiana and shareholders of such banking corporations shall be subject to the payment of all taxes of the State of Louisiana and any subdivision thereof in the same manner as national banking corporations doing business in Louisiana and their shareholders are taxed by the State of Louisiana and any subdivision thereof under the laws and regulations of the United States of America and the State of Louisiana, and in no other manner.”

      . FCC also argues from R.S. 47:1511 that the Collector’s post-1972 interpretation of the tax law to tax bank dividends was invalid for lack of notice. However, it was not the Collector, but the Congress who, by removing the federal impediment, allowed the 1934 state law its force.

      . A semantic problem is that R.S. 47:121(2) only exempts from income taxation national banks “who pay a tax for their shareholders or whose shareholders pay a tax on their shares of stock under other laws of this state ....” R.S. 47:1967-1970 imposes a tax on the shares of banks but not on the shares of corporations which own bank shares. Probably, nevertheless, R.S. 47:8 must be interpreted to give a pure holding company and its shareholders the same tax status as any national bank and its shareholders because every national bank in Louisiana paid share taxes.

      . The language of the Title of the Act, “shareholders of such banking and other corporations”, is broader than the language of the body of the Act, “shareholders of such banking corporations”.


author: COLE, Judge.

text:
    STATE of Louisiana Through the OFFICE OF the GOVERNOR, etc. v. L. W. EATON CONSTRUCTION CO., INC., et al.
    No. 13284.
    Court of Appeal of Louisiana, First Circuit.
    May 5, 1980.
    See also La.App., 392 So.2d 477; 392 So.2d 481.
    Joseph S. Cage, Jr. and Robert A. Lee, Monroe, for plaintiff-appellant, State of Louisiana, through office of the Governor, Etc.
    Frank P. Simoneaux, Baton Rouge, for defendant-appellee, L. W. Eaton Const. Co., Inc.
    John Samaha, Baton Rouge, for defendant-appellee, American Arbitration Ass’n, Inc.
    Before COVINGTON, LOTTINGER and COLE, JJ.
   COLE, Judge.

This is a motion by the defendant-appel-lee, L. W. Eaton Construction Company, Inc., to dismiss the appeal of the plaintiff-appellant, the State of Louisiana, on the ground that the matter before this Court is now moot. For the reasons hereafter assigned, we find the motion to dismiss must be denied.

This suit involves a contractual dispute. Prior to April 4, 1973, the state had advertised for bids for the construction of a facility for the L.S.U. School of Veterinary Medicine in Baton Rouge, Louisiana. Eaton was eventually determined to be the low bidder.

On that date, these parties entered into a contract for the proposed construction work and on June 13,1978, the state accepted the building as being substantially complete.

During the progress of the construction, it came to the attention of the state that certain steel was being used on the job which it felt did not comply with the contract specifications. Delays and price adjustments thereafter occurred which resulted in Eaton filing a demand for arbitration shortly after acceptance of the project.

On July 20, 1979, the state filed this suit which seeks an injunction against the arbitration proceedings and a declaratory judgment declaring the contract between the parties to be null and void.

On August 14,1979, a hearing was had on the merits of the state’s demand for a preliminary injunction and the district court subsequently denied that relief. The state then perfected this devolutive appeal from that judgment.

On October 8, 1979, the arbitration proceedings began and were eventually completed on January 10, 1980. An award was entered by the arbitrators on February 24, 1980 and Eaton has apparently moved to confirm that award, pursuant to the provisions of LSA R.S. 9:4209, although those pleadings are not a part of this record.

Eaton’s motion to dismiss the appeal of the state from the denial of the preliminary injunction asserts that since the arbitration proceedings have now taken place and an award made, the state’s attempt to obtain injunctive relief is now moot.

They cite in support of that motion City Stores Co. v. Gervais F. Favrot Co., Inc., 315 So.2d 370 (La.App. 4th Cir. 1970), in which an appeal was dismissed which sought to have an arbitration proceeding preliminarily enjoined, where the arbitration was completed before the appeal was heard. There the court reasoned:

“We point out that the purpose of the preliminary injunction was to stop arbitration during the pendency of the suit, and arbitration is now complete, hence no order issued by this court on an appeal from a preliminary injunction could act to stop what has already been accomplished. In such a situation, an appeal from the denial of the trial court to enjoin an act subsequently committed is rendered moot. Mecom v. Mueller, 235 So.2d 597 (La.App. 4th Cir. 1970); Barnes v. City of Hammond, 276 So.2d 746 (La.App. 1st Cir. 1973); Morehouse Police Jury v. Wild Life & Fisheries Commission, 199 So.2d 542 (La.App. 4th Cir. 1967); Heard v. Seegers, 186 So.2d 170 (La.App.2d Cir. 1966).”

Here, there is no evidence before us that the arbitration is finally complete and, to the contrary, it appears from the briefs of counsel that Eaton has only recently filed the necessary documents to have the action of the arbitrators confirmed in accordance with the Louisiana Arbitration Law. Therefore, it is still possible for the appellant to obtain the relief sought in this court.

We note also, that unlike City Stores, supra, this is a suit which seeks to have the contract between Eaton and the state declared to be totally null and void due to alleged violations of the public bid statutes. In such a case, the Supreme Court of this state declared that arbitration proceedings were to be stayed until it could be judicially decided whether the contract was void ab initio. See George Engine Co., Inc. v. Southern Shipbuilding Corp., 350 So.2d 881 (La.1977).

Therefore, we find the authority relied upon by the moving party is not applicable here, the matter before the court on appeal is not, at this time, moot and the motion to dismiss the appeal must be denied.

MOTION DENIED.


author: LOTTINGER, Judge. PONDER, Judge,

text:
    STATE of Louisiana, THROUGH the OFFICE OF the GOVERNOR, Division of Administration and the Facility Planning and Control Department, v. L. W. EATON CONSTRUCTION COMPANY, INC. et al.
    No. 13284.
    Court of Appeal of Louisiana, First Circuit.
    Oct. 6, 1980.
    Rehearing Denied Dec. 15, 1980.
    See also, La.App., 392 So.2d 475; 392 So.2d 481.
    Joseph S. Cage, Jr., Robert Lee, Monroe, for plaintiff-appellant, State of Louisiana, through office of the Governor, Etc.
    Frank P. Simoneaux, Baton Rouge, for defendant-appellee, L. W. Eaton Const. Co., Inc.
    John N. Samaha, Baton Rouge, for defendant-appellee, American Arbitration Ass’n, Inc.
    Before LOTTINGER, EDWARDS and PONDER, JJ.
   LOTTINGER, Judge.

One issue is before us in these two injunction proceedings, which have been consolidated on appeal: Was the public bid law (La.R.S. 38:2211 et seq.) violated when the State awarded the contract for construction of the School of Veterinary Medicine on the Louisiana State University campus in Baton Rouge?

The State first sought, but failed to obtain, a preliminary injunction to enjoin arbitration proceedings commenced by the defendant, L. W. Eaton Construction Company, after construction of the school was completed. While the appeal from the trial court’s refusal to grant the preliminary injunction was pending in this court, the hearing for a permanent injunction took place. The State was again unsuccessful in the lower court, and a second appeal was taken. In both proceedings, the State claimed the contract containing the arbitration provision was absolutely null because Eaton employees learned of impending plan changes the day before bids were submitted. The State contended that Eaton’s knowledge of the plan changes, regardless of whether Eaton relied on such knowledge, violated the bid law provision requiring that any addendum modifying the plans and specifications within 72 hours prior to bid opening necessitated a one-week delay in bid opening. La.R.S. 38:2211(B). The State also claimed that Eaton violated the provision of the bid law requiring that bids be submitted “according to the contract, plans and specifications as advertised. La. R.S. 38:2211(A), emphasis ours.

In both proceedings, Eaton asserted that the contract was validly confected in conformance with the bid law. The company also claimed the State should be estopped from asserting the contract’s invalidity because the State eventually accepted the change in steel size and later accepted the entire project.

Because the issues in both proceedings are identical, we consolidated these cases on appeal. Both proceedings will be handled in this opinion, but separate judgments will be rendered.

THE FACTS

On February 27, 1973, Eaton submitted a $15.8 million bid on the vet school job, some $400,000 less than the next to lowest bidder. The day before the bids were submitted, Robert Cleveland, a structural engineer for the architect on the job, informed Eaton’s principal estimator that the plans and specifications for reinforcing steel bars probably would be changed. As advertised prior to bidding, the plans and specifications called for grade A-40 steel. The change would allow suppliers to furnish grade A-60 steel. Because the A-60 steel had a stronger tensile strength than the A-40 steel, use of the stronger steel allowed the size of some of the bars to be reduced. The reduction in circumference resulted in a reduction in the weight and the price of the steel used on the job.

When a state inspector discovered the smaller sized steel about a year after construction commenced, the State sought a credit for the reduced steel. Eaton vigorously protested allowance of a credit for the smaller and cheaper steel, claiming that the credit had been reflected in its bid on the job. Later, however, Eaton reluctantly agreed to allow a $15,650.00 credit for the reduced amount of steel. A change order officially approving the stronger but smaller sized steel was issued after the credit was given to the State, and the job proceeded to completion. Both sides in this litigation agree that the steel used on the job is as good as or better than that specified originally in the plans and specifications. The State accepted the building as substantially complete in May, 1978, and the school is now occupied.

In June, 1978, under the arbitration clause in the contract, Eaton filed a demand for arbitration with the second defendant in this case, the American Arbitration Association, seeking $6.7 million in an upward equitable adjustment to the contract price. The State then filed this suit to enjoin the arbitration proceedings on the ground that the contract containing the arbitration provision was null and void because of the alleged bid law violation.

At the hearing on the preliminary injunction and in additional testimony at the permanent injunction hearing, Eaton’s executive vice president, David H. Broussard, testified that Eaton placed no reliance on the information it received from the structural engineer on the day before the bids were submitted. Mr. Broussard’s testimony and Eaton’s documentary evidence indicate that Eaton’s final bid was calculated on the price of A-40 steel as per the plans and specifications as advertised. The evidence shows that the change in the size and price of the steel was not officially approved by the structural engineer until after Eaton learned that it would be awarded the contract on the job. The preponderance of the testimony indicates that Eaton’s employees relied in good faith on the apparent authority of the structural engineer to change the steel size after bidding, but that Eaton did not rely on the purported plan changes in submitting its bid.

Additionally, Eaton employees testified that they were under the impression that other contractors and subcontractors had been notified of the probable plan change in steel specifications. However, the vice president and estimator of one of the other contractors who bid on the job could not specifically recall whether he was informed of the impending plan change prior to bidding. Conspicuously missing from the record in this regard is the testimony of the structural engineer who purportedly informed Eaton and perhaps other contractors of the planned change in specifications. Our opinion in this case, however, does not turn on whether Eaton alone received the prebid information.

The State places much emphasis on the fact that Eaton changed its position concerning its reliance on the information received by the structural engineer on the day prior to bidding. When the State sought the credit for the smaller steel, Eaton contended that the bid price reflected the smaller steel — an indication that Eaton had placed reliance on the structural engineer’s information. In these .two proceedings, however, Eaton is claiming that it did not rely on the structural engineer’s statement when it made the bid on the job. Eaton’s inconsistent positions were explained in detail by Mr. Broussard during his lengthy testimony on the stand. Broussard admitted that he had not fully investigated his files when the State sought the credit and that he truly believed at that time that no credit was due. Upon further investigation in preparation for the injunction proceedings, Broussard discovered that Eaton’s bid had been based on the A-40 steel as provided in the plans and specifications. The trial judge believed Mr. Broussard’s explanation and expressly so stated. Our thorough review of the record convinces us that the trial court correctly decided the factual issues in this case. We, too, find that Eaton placed no reliance on the information it received from the structural engineer prior to the bid date.

THE LAW

The public bid law is a prohibitory law enacted in the public’s interest to help insure that tax dollars for public works are spent wisely. Competitive bidding following public advertisement is the vehicle by which government entities seek to get the lowest possible price from a responsible bidder on a public works job. Preventing exorbitant and extortionate prices as well as favoritism is the primary goal of the law. Haughton Elevator Division v. State, through the Division of Administration, 367 So.2d 1161 (La.1979). A contract made in violation of the public bid law is absolutely null and invalid. Pleas of estoppel and ratification cannot be heard because the nullity is absolute in character. Boxwell v. Department of Highways, 203 La. 760, 14 So.2d 627 (1943). Additionally, if a contract is void ab initio because of some fatal defect in its confection any arbitration provision contained within it is also a nullity. West Baton Rouge Parish School Board v. T. R. Ray, Inc., 367 So.2d 332 (La.1979); George Engine Company, Inc. v. Southern Shipbuilding Corporation, 350 So.2d 881 (La.1977).

Besides requiring bidders to submit proposals in accordance with the advertised plans and specifications, the bid law provides that any changes in the plans and specifications within 72 hours of bidding require a one week delay in the bidding process so that all bidders can take the changes into consideration. La.R.S. 38:2211(B). The purpose of this provision is, again, fairness to all persons interested in bidding on the job. As a matter of public policy, if plan changes on a public works job are made within three days of the bid opening date the bidding public should be given time to gather the information necessary to comply with the plan changes.

Our thorough review of the facts and circumstances of this case and the law relating to public bidding in this state convinces us that there has been no violation of the public bid law. The verbal statement by the structural engineer to Eaton employees the day prior to bidding simply did not amount to a change in the plans and specifications necessitating a delay in the bid process. That the structural engineer’s statement did not amount to a change in the plans and specifications is reflected by the fact that Eaton, and apparently the other bidders on the job, submitted quotations based on the reinforcing steel as specified in the written plans and specifications. We disagree with the State’s contention that a mere verbal communication of a probable plan change constitutes a violation of the bid law. Unless some reliance is placed by the successful bidder upon such a verbal communication or some favorable benefit is obtained therefrom, the fact that a contractor or contractors are verbally informed in advance of a likely change in plans does not constitute a bid law violation.

Hypothetically, if the short supply of A-40 steel would have caused some contractors not to bid, then the knowledge by one or more contractors that a probable change to a more readily available steel would be approved after the awarding of the contract could conceivably be a benefit to those with such knowledge. That, however, has not been shown to be the situation in this case.

The record in this case is devoid of evidence that Eaton received favorable treatment on this job or placed any reliance whatsoever on the statements of the structural engineer. And, as we stated earlier, the verbal communication by a structural engineer of a probable change in steel specifications does not amount to a change in the plans and specifications which would trigger the provisions of La.R.S. 38:2211(B).

The facts in this case are clearly distinguishable from those in W. R. Aldrich & Company v. Gravity Drainage District No. 1 of Rapides Parish, 238 La. 190, 114 So.2d 860 (1959) and the cases cited therein. The public body in the Aldrich case made a substantial change in the planned project after bids were submitted, and this change resulted in the second to lowest bidder getting the job. The court in Aldrich noted that such major manipulations of the contract items after bids were submitted would allow a public body to award the contract to any one of the bidders, a practice that could defeat the purpose of the public bid laws. In the case at bar, there was no material departure in the contract from the plans and specifications upon which the bids were submitted. The minor change in the type of steel allowed to be used on the job resulted in no favoritism to one contractor over the other and did nothing to defeat the purpose of the law requiring contracts to be let upon bids submitted according to advertised specifications.

The cases of Donaldson v. Police Jury of Tangipahoa Parish, 161 La. 471, 109 So. 34 (1926) and Adams v. Town of Leesville, 210 La. 106, 26 So.2d 370 (1946) are likewise distinguishable upon their facts.

Therefore, for the above and foregoing reasons, the decision of the trial court in case No. 13284 is affirmed. The costs of these consolidated cases, amounting to $1,321.58, will be borne by the State.

AFFIRMED.

PONDER, Judge,

dissenting.

I respectfully dissent.

If I understand the majority’s opinion, the affirmation is based upon the conclusion that there was no violation of the public bid law, that there was no reliance upon the change in plans and that the change in plans was not substantial. I pretermit any discussion that to some extent these conclusions are internally inconsistent.

The applicable statutory provision is found in LSA-R.S. 38:2212 B reading as follows:

“B. No public entity shall issue or cause to be issued any addenda modifying plans and specifications within a period of seventy-two hours prior to the advertised time for the opening of bids, excluding Saturdays, Sundays and any other legal holidays. If the necessity arises to issue an addendum modifying plans and specifications within the seventy-two hour period prior to the advertised time for the opening of bids, then the opening of bids shall be extended exactly one week, without the requirement of readvertising as provided by Subsection A of this Section.”

I believe it to be too simplistic, if not more, to assert that there has been no modification of plans and specifications because the structural engineer conveyed the information orally and informally rather than in a formal addendum.

The purpose of the public bid law is to require competitive bidding so as to get the lowest price from a responsible bidder preventing exorbitant prices and favoritism. The hypertechnical requirement that any change, to be a change, must be a formal one can lead to the very practices sought to be prohibited by the public bid laws.

I find no requirements in the above statute and in the jurisprudence that there must be reliance upon the change or that the change must be substantial. The majority has cited no such statutory or jurisprudential requirement. The danger of these interjections is pointed up by the inconsistent positions taken by the appellee, that yes, it did rely on the change, and no, it did not rely on the changes. Even if the inconsistency be explained it still shows the danger of a subjective requirement.

Since I believe that the majority’s opinion is an approval of a violation of both the letter and the spirit of the public bid law, I respectfully but firmly dissent.

      . Number 13835 on the Docket of this Court, 392 So.2d 481.

      . The public bid law has been amended numerous times over the years. The provision applicable to the bids submitted in this case is R.S. 38:2211 as amended by Act 274 of 1970. Section 2211 has since been renumbered to Section 2212, but its substantive provisions relating to this case remain the same today.


author: LOTTINGER, Judge.

text:
    STATE of Louisiana, Through the OFFICE OF the GOVERNOR, Division of Administration and the Facility Planning and Control Department v. L. W. EATON CONSTRUCTION COMPANY, INC., et al.
    No. 13835.
    Court of Appeal of Louisiana, First Circuit.
    Oct. 6, 1980.
    Rehearing Denied Dec. 15, 1980.
    John S. Cage, Jr., Monroe, for plaintiff-appellant, State of Louisiana.
    Frank P. Simoneaux, Baton Rouge, for defendant-appellee, L. W. Eaton Const. Co., Inc., et al.
    John N. Samaha, Baton Rouge, for exceptor, American Arbitration Assoc.

      Before LOTTINGER, EDWARDS and PONDER, JJ.
   LOTTINGER, Judge.

This appeal from the trial court’s refusal to grant a permanent injunction was consolidated by this Court with the appeal from the trial court’s refusal to grant a preliminary injunction. We dealt with all the issues involved in No. 13284 on the docket of this Court, 392 So.2d 477.

Therefore, for the reasons announced in Case No. 13284, the decision of the trial court refusing to permanently enjoin arbitration proceedings is affirmed.

AFFIRMED.


author: COVINGTON, Judge.

text:
    Leola SCOTT v. STATE of Louisiana, Through the DEPARTMENT OF TRANSPORTATION AND DEVELOPMENT.
    No. 13359.
    Court of Appeal of Louisiana, First Circuit.
    Sept. 16, 1980.
    Rehearing Denied Dec. 15, 1980.
    Writ Refused Feb. 6, 1981.

      James A. Wood, Joel B. Dickinson, Baton Rouge, for plaintiff-appellee Leola Scott.
    David K. Balfore, William J. Doran, Baton Rouge, for defendant-appellant State of Louisiana, through the Dept, of Transp. and Development.
    Before COVINGTON, LOTTINGER and COLE, JJ.
   COVINGTON, Judge.

This is an appeal by the defendant, State of Louisiana, Department of Transportation and Development, from a judgment of the District Court in favor i ” the plaintiff, Leola Scott, in the sum of $£>,166.62, with interest and costs. We affirm.

The suit arises out of an accident that occurred on January 25, 1978, on Louisiana Highway 44 approximately three-tenths of a mile from the intersection of Highway 44 and Airline Highway at the first bridge crossing. It was a one-car accident which the plaintiff alleged happened when she struck a pothole in the road in her lane of traffic. As a result, the plaintiff claimed she sustained personal injuries and property damage. She alleged that the sole and proximate cause of the accident was the negligence of the Department in failing to maintain the roadway when the defendant knew or should have known that the roadway was in a defective condition; failing to warn the public of the dangerous condition; failing to monitor and control the roadway for such defects; and failing to repair the situation after having actual knowledge of the existence of the dangerously defective condition. The Department denied any negligence on its part, and affirmatively asserted that the accident was caused solely by the negligence or contributory negligence of the plaintiff.

After trial, the District Court issued written reasons for judgment on June 5, 1979, dismissing the plaintiff’s suit at her costs. The basic reasons set out by the court were that the Department is not responsible for the results of all defects in the highways of the state, that in order for the Department to be liable there must exist a condition presently dangerous to prudent persons, and the Department must have had prior actual notice of the condition unless the defect has existed sufficiently long enough for it to be charged with constructive notice thereof. The trial judge found the pothole was an obviously dangerous condition and that Mrs. Scott was free from any negligence in striking it, but dismissed the suit on the ground that there was no evidence that the Department had either actual or constructive notice of the defective roadway.

The plaintiff timely moved for a new trial, which was granted without additional testimony or other evidence. On November 8, 1979, the trial court reversed its prior decision, and awarded damages to the plaintiff. The trial judge assigned written reasons for judgment, as follows:

“In its written reasons of June 5, 1979, the Court based its decision on the fact that no evidence existed to inform the State of Louisiana, Through Department of Transportation and Development of the existence of the pot hole that caused the accident, citing prior jurisprudence, Pickens v. St. Tammany Parish Police Jury, [La.App.] 308 So.2nd 361; Miller v. City of New Orleans [La.App.] 152 So. 141.
“The jurisprudence in Louisiana, specifically, the First Circuit Court of Appeal for the State of Louisiana, has now eliminated the need of notice to the State of Louisiana, before liability can attach.
“In the present case on January 25, 1978, Leola Scott was driving south on La. Hwy 44 toward Gonzales and as she crossed a bridge, her vehicle struck a pot hole that caused her personal injuries and property damage.
“According to Mrs. Scott, she had gone to the Triangle Grocery to shop, however, not finding the items she desired, she entered La. Hwy 44 to proceed to Gonzales to shop. She described La. Hwy 44 as having numerous small holes that she would try to dodge. Her maximum speed was 30 mph before arriving at a narrow bridge. As she approached the narrow bridge, she slowed to approximately 20 mph and as she was leaving the bridge she noticed a large pot hole.
“She testified that as she was at the end of the bridge she noticed the pot hole, but did not realize the depth, however, because of on coming traffic, she could not leave her lane of traffic. She further stated that she could not stop in time to avoid hitting the hole.
“Mrs. Scott stated she and a cousin went to the scene of the accident of [on] January 26, 1978, to observe the hole, however, the Highway Department had repaired the hole (See Exhibit P-3-4-5). “Upon hitting the hole, the impact caused the rear windshield to shatter. Mrs. Scott stated she sustained personal injuries.
“In apply[ing] La.C.C. Article 2317 this Court finds that the plaintiff has proven that the State of Louisiana had custody of LA. Hwy 44, that the highway was defective and that the defect caused Mrs. Scott’s injuries. The application of strict liability under C.C. Article 2317 is applicable to governmental agencies. [American] Road Ins. Co. v. Montgomery, 345 [354] So.2nd 656 (La.App. 1st Cir. 1978); Durbin v. City of Baton Rouge, 366 So.2nd 1020 (La.App. 1st Cir. 1978); and Leroy Jones, et ux v. City of Baton Rouge, La.App. 1st Cir. [376 So.2d 1003] Oct. 8, 1979, No. 12809.
“Under Loescher v. Parr 324 So.2nd 441 (La.1975), the custodian of the thing is absolved from liability only upon proving that the damage was caused by the fault of the victim, by the fault of a third person, or by an irresistible force. The evidence does not reveal that Mrs. Scott was at fault. According to her testimony she could not have changed lanes of traffic due to oncoming traffic. Further, she stated she could not have stopped in time to avoid the hole.
“The defendant did not present any evidence whatsoever to contradict Mrs. Scott’s testimony.
“This Court finds the defendant liable pursuant to LA.C.C. Article 2317.
“Dr. A. K. Fleet, general practitioner testified he first saw Mrs. Scott on January 27,1978, and subsequently treated her for a whiplash injury to the neck and a strain of the lower back. The physical treatment consisted of diathermy and cortisone injections. He saw Mrs. Scott 23 times, from January 27, 1978 to April 20, 1978. This prognosis was that her recovery was good. His fee for treatment was $223.00.
“Mrs. Scott had x-rays and therapy treatment at the Baton Rouge General for a cost of $284.00 (Exhibit P-6). Prescription expenses were $36.62 (Exhibit P-7). “Mrs. Scott testified that she incurred an expense of $123.00 to replace the rear windshield.
“This Court believes an award of $2500.00 is adequate to compensate Mrs. Scott for her personal injuries. Further the Court will award the following expenses.
(1.) Medical Expense — Dr. Fleet $223.00
(2.) Baton Rouge General Hospital 284.00
(3.) Prescriptions 36.62
(4.) Property damage 123.00
Judgment is rendered in favor of Leola Scott and against the State of Louisiana, Department of Transportation and Development in the sum of $3,166.62, together with legal interest from judicial demand and all costs.
“Expert witness fee of Dr. Fleet is fixed at $75.00 and is to be paid by defendant.”

On appeal, the Department argues that the law of this state regarding the liability of public bodies, such as the Department of Transportation and Development, is that which is expressed by our Supreme Court in United States Fidelity and Guaranty Company v. State, Department of Highways, 339 So.2d 780 (La.1976), and that that case, having been decided after Loescher v. Parr, 324 So.2d 441 (La.1975), is controlling with regard to the liability of public bodies, so that in order to hold the Department liable for an accident caused by a dangerous condition of a state highway, it must be shown that the Department had prior notice, either actual or constructive, of the dangerous condition and had sufficient opportunity to remedy the condition and failed to do so.

We disagree. We find this matter to be controlled by our decisions in American Road Insurance Company v. Montgomery, 354 So.2d 656 (La.App. 1 Cir. 1978), writ denied, 356 So.2d 430, 434, 435 (La. 1978); Durbin v. City of Baton Rouge, 366 So.2d 1020 (La.App. 1 Cir. 1978); and Jones v. City of Baton Rouge, 376 So.2d 1003 (La.App. 1 Cir. 1979). In American Road Insurance Company, we applied the strict liability under LSA-C.C. art. 2317 as interpreted by the Court in Loescher v. Parr, supra, to governmental agencies. In Dur-bin we reaffirmed our holding in American Road Insurance Company, and noted the contrary holding of our brothers of the Third Circuit in Gallien v. Commercial Union Insurance Co., 353 So.2d 1127 (La.App. 3 Cir. 1977), writ denied, 354 So.2d 1379 (La. 1978), which held that Article 2317 did not apply to governmental agencies. In Jones we pointed out that the difference between the two circuit courts addressed itself to the supervisory authority and jurisdiction of our Supreme Court.

The Department next argues that under Loescher v. Parr and American Road Insurance Company v. Montgomery, above, it is absolved from liability because it has proved that the damage was caused by the fault of Mrs. Scott, in that she failed “to observe the conditions of the roadway to adjust her driving accordingly.” We have reviewed the record and find this argument without merit. Mrs. Scott testified that as she approached the end of the bridge she saw the pothole, but she could not stop in time to avoid the hole and was not able to change lanes due to the traffic. The defendant offered no evidence showing any fault on the part of the plaintiff. The case of Dupre v. Louisiana Department of Highways, 154 So.2d 579 (La.App. 3 Cir. 1963), cited by the Department in its brief, is factually distinguishable. In the instant case the plaintiff was not driving at an excessive speed, and traffic conditions made it impossible for her to avoid the pothole.

The appellant’s final argument that the plaintiff failed to sustain her burden of proof is without merit. It is not necessary that an accident be investigated by a law enforcement officer for an injured party to recover from a mishap caused by the fault of another. A plaintiff need only prove his case by a preponderance of the evidence. If the credible evidence preponderates in favor of the plaintiff’s position, as it does in this case, the trial court is justified in finding for the plaintiff. If the record reveals a reasonable factual basis for the finding of the trial court and the record reveals that the finding is not clearly wrong (manifestly erroneous), we are not permitted to reverse the factual findings of the trier of fact. Arceneaux v. Domingue, 365 So.2d 1330 (La.1978). We find no manifest error in the trial court’s findings.

Therefore, for the reasons stated above, the judgment of the trial court is affirmed. The appellant is assessed with the costs in the amount of $434.18.

AFFIRMED.

      . The medical bill for Dr. Fleet’s services, P-1 is for $233.00 instead of $223.00; however, since the plaintiff neither appealed nor answered the appeal, we can not increase the award.

      . We withheld disposition of the instant case for several months, awaiting the decision of the Supreme Court in Jones v. The City of Baton Rouge-Parish of East Baton Rouge, No. 66480. That decision, which was handed down on September 3, 1980, is now cited as additional authority for our holding herein.