text:
    PELTO OIL COMPANY v. COLLECTOR OF REVENUE OF the STATE OF LOUISIANA (two cases). SOUTHDOWN, INC. v. COLLECTOR OF REVENUE OF the STATE OF LOUISIANA.
    Nos. 10639, 10640 and 10641.
    Court of Appeal of Louisiana, Fourth Circuit.
    May 13, 1980.

      Jones, Walker, Waechter, Poitevent, Carrere & Denegre, Thomas C. Keller, Robert R. Casey and Rudolph R. Ramelli, New Orleans, for Pelto Oil Co. and Southdown, Inc., plaintiffs-appellants.
    Riley F. Boudreaux, Jr., Lutcher, for Collector of Revenue, defendant-appellee.
    Before SAMUEL, LEMMON and GU-LOTTA, JJ.
   SAMUEL, Judge.

Plaintiffs in these consolidated suits appeal from a judgment of the Civil District Court for the Parish of Orleans upholding a decision of the Board of Tax Appeals for the State of Louisiana which held certain certificates of deposit and United States Government securities did not obtain a business situs and that the commercial domicile of Pelto Oil Company was the State of Louisiana rather than the State of Texas, thereby making these securities subject to Louisiana income and franchise taxes.

Incorporeal property or rights and the income derived from them are allocated by R.S. 47:243 A(4) and R.S. 47:606 A(l)(h) and (2)(b) to the state in which the business situs of the incorporeal property is located or, in the absence of a business situs, to the commercial domicile of the corporate tax payer. Both Pelto and Southdown, Inc. contend Pelto’s commercial domicile during the years in question was Houston, Texas and not New Orleans, Louisiana. The Collector of Revenue, on the other hand, maintains the securities did not acquire a business situs outside Louisiana and Pelto maintained its commercial domicile in Louisiana.

Pelto Oil Company was a division of Southdown, Inc. prior to its organization as a Delaware corporation in 1969. Pelto was qualified to do business in Texas, Alabama, Mississippi, and Louisiana. After its liquidation in September, 1974 it again did business as a division of Southdown, Inc.

Southdown, a Louisiana corporation, owned all the outstanding stock of Pelto during most of 1971. For the remainder of 1971 and during 1972,1973, and 1974 South-down owned 56% of the outstanding common shares by value of Pelto and 83% of Pelto’s voting power. During these years, Pelto filed consolidated federal income tax returns with Southdown.

In somewhat oversimplified terms, R.S. 47:243 provides that, for income tax purposes, interest income shall be allocable to the state in which securities producing such income have their business situs. If the securities have not been used so as to establish a business situs, the commercial domicile of the taxpayer determines the state in which the interest income is taxable.

The “commercial domicile” of the owner of these securities is likewise a factor in determining the Louisiana franchise tax. Revised Statute 47:606 A establishes a franchise tax base allocable to Louisiana and provides that the revenue factor (Louisiana revenue as a proportion of total revenue) is determined by allocating interest to Louisiana when the securities producing the interest have a business situs in Louisiana; if a business situs for the securities cannot be found the interest income allocable to Louisiana is taxed to the taxpayer if its commercial domicile is in Louisiana. Revised Statute 47:606 further provides that the property factor for determining franchise tax (Louisiana assets as a proportion of total assets) includes securities as Louisiana assets if they have established a business situs in Louisiana or, in the absence of a business situs, the taxpayer’s commercial domicile is in Louisiana.

Southdown, the parent corporation of Pelto, has an interest in this proceeding because the franchise tax it pays will depend on the taxable base in Louisiana of Pelto Oil Company. The proposed reallocation to Louisiana of Pelto’s securities and their income would increase Southdown’s franchise tax, since that tax is measured in part by the value of its investment in the Pelto stock.

Appellants rely on the following facts to establish the incorrectness of the Collector’s proposed assessment: During the years in question, four of the eight Pelto officers, including its chairman and chief executive officer, worked in Pelto’s office in Houston. All Pelto’s annual stockholders’ meetings were held in Houston. Approximately two-thirds of its board of directors’ meetings were held in Houston, and only one-third in New Orleans. The purpose of the New Orleans board meetings was solely to review Pelto’s drilling operations and pending business prospects, “and not to make significant management decisions.” Sixty to eighty-five percent of the wells and leases owned by Pelto were located outside Louisiana.

The Pelto officers in Houston expended approximately twenty-five percent of their time performing services for Pelto under a management contract between it and Southdown. A management fee was paid by Pelto to Southdown of $10,000 per month plus reimbursement of all direct expenses incurred by Southdown. The management fee was used to cover salaries of Pelto officers and Southdown clerical personnel performing services for both South-down. and Pelto. Annual budgets and annual profit plans were initiated by the New Orleans employees and submitted to the Houston office for approval or adjustment, and variances from budgets and profit plans were explained monthly in written reports to the Houston office. The officers in Houston were compensated by Pelto indirectly through the $10,000 per month management fee paid Southdown. In addition, during 1974 Pelto directly paid its chairman and chief executive officer remuneration of $172,500, paid its vice president and assistant to the chairman $47,920, and paid its vice president of finance $24,608. The chairman and chief executive officer of Pel-to in Houston set budget guidelines for Pelto for capital spending in various geographical areas and established the method for its raising capital. Pelto’s business in Houston was not one which required contact with the general public, so it was not necessary to conduct business in Houston for Pelto to have a separate telephone listing or an office separate from the South-down offices, because all of Pelto’s customers knew Pelto could be contacted at the Houston office of Southdown.

Pelto’s annual reports to shareholders showed two offices for the corporation, one in Houston and one in New Orleans. These annual reports were prepared with the assistance of Houston legal counsel only, without aid from Louisiana legal counsel. Pelto’s president, located in New Orleans, consulted frequently with the Houston based chairman and chief executive officer on various business decisions necessary in Pelto’s business. He contacted the chief executive officer by telephone at a minimum of once a week, usually on a daily basis, and frequently several times a day. These two gentlemen consulted on various management decisions and did not restrict their consultations solely to broad policy decisions with respect to Pelto’s operations. Because of the experience of the chief executive officer in Houston, he was able to make business decisions for Pelto on a daily basis, and the Houston office made all top-level management decisions for the corporation.

All decisions regarding possible corporate acquisitions by Pelto were made in Houston, and all negotiations were handled by the Houston office with the assistance of Houston legal counsel only. Louisiana counsel were involved in negotiations only to the extent needed to answer questions on Louisiana law and to render real estate title opinions. The Houston officers made all the decisions relating to taking Pelto public in 1971, with no New Orleans employees being involved in the making of this decision.

In 1971, approximately $23,000,000 in certificates of deposit in United States Government securities was invested by Pelto, and no portion of these funds was invested in interest-bearing accounts of banks or other issuers located in Louisiana. The Houston office initially invested these funds and later the secretary-treasurer in New Orleans was told by the Houston office where these funds were invested in 1971 and the allocation of these funds among bank certificates of deposit and United States Government securities. The New Orleans based secretary-treasurer was instructed to reinvest the proceeds of certificates of deposit when they matured into identical certificates of the same issuer unless he was directed by the Houston office to reinvest those proceeds in other investments determined by the Houston office. At no time was the secretary-treasurer’s opinion sought as to where the proceeds should be reinvested, and the Houston officers completely controlled these investments. The New Orleans officer was only used to convey the Houston officer’s instructions so he could keep proper accounting records of the investments.

All certificates of deposit owned by Pelto were physically kept by the issuing bank, and the government securities were kept by an investment firm in Houston. The Houston officers often directed the secretary-treasurer in New Orleans to invest certificates of deposit in certain banks to establish good banking relationships for either Pelto or other Southdown subsidiaries. Such investments were made in Continental Illinois National Bank, Wells-Fargo National Bank, and Valley Bank of Nevada. No officers of Pelto in New Orleans were ever consulted regarding the type of investments to be made or the issuing banks from which certificates of deposit were to be purchased. Pelto filed Louisiana, Delaware, Mississippi, and Texas franchise tax returns. However, under Texas franchise tax law, these certificates were excluded from the Texas franchise tax base because of the particular provisions of Texas law.

We conclude that the foregoing facts do not support the position of Pelto and South-down, and we conclude that both the Board of Tax Appeals and the Civil District Court for the Parish of Orleans were correct in maintaining the proposed assessment by the Collector of Revenue.

The statutory rules mentioned above determine whether incorporeal moveables and their income should be attributable to Louisiana for the calculation of income and franchise taxes. These rules were explained by the Louisiana Supreme Court, as they apply to income taxes, in United States Gas Corporation v. Fontenot. That court stated if the income is from securities or credits that have acquired a “business situs” in another state, then that income is allocated to the state of “business situs”. If no such “business situs” has been established in another state, then the income in the case of a corporation is allocated to the state where the corporation has its “commercial domicile”. Since the statutory rules are basically the same for income and franchise taxes, the Fontenot decision can be said to apply to both.

In the present case, it is evident the securities have not established a “business situs” either in or outside Louisiana. The Supreme Court in the Fontenot case defined business situs as follows:

“. . .if the intangibles are used in another state in such a way as to there ‘become an integral part’ of a business carried on within the foreign state, that state, may tax such intangibles on the basis of a ‘business situs’ acquired there.”

Thus, the essential elements for establishing a “business situs” for incorporeal moveables is that they become an integral part of the business of the owner. Even the facts relied upon by Pelto and Southdown establish the deposits were used primarily for the establishment of the banking goodwill of Southdown and not Pelto. Moreover, the deposits were not bound permanently to any bank by formal agreement or otherwise; they were in fact shifted from place to place at will.

The Board of Tax Appeals made the following conclusion with regard to the business situs of the securities;

“The securities in question do not obtain a ‘business’ situs of their own because the evidence did not show that they obtained enough open ‘localization’ and were not an integral part of an independent business in a state other than Louisiana.”

The Collector correctly argues the deposits in question were not an integral part of the business of Pelto in Texas or in any other state, nor were they localized in any other state. Consequently, they could not and did not acquire any business situs whatever. The taxability of these securities in Louisiana depends of necessity on whether or not Pelto, a Delaware corporation, had its “commercial domicile” in Louisiana. If it did, both the assets and their income may be allocated to Louisiana under the above cited statutes to calculate both Louisiana income and franchise tax.

The concept of using commercial domicile rather than legal domicile as a situs of intangibles (not possessing a situs elsewhere) for tax purposes was sanctioned in the landmark case of Wheeling Steel Corporation v. Fox. In that case the United States Supreme Court found the commercial domicile of Wheeling Steel to be in the state of West Virginia even though 80% of its expenditures were made outside West Virginia and its principal manufacturing plants were located in Ohio. The basic holding of the court in justification for allowing the state of West Virginia to impose tax on the intangibles was that the general business offices of the corporation were located in Wheeling, West Virginia, where the officers of the corporation resided.

The leading Louisiana case regarding commercial domicile is North Baton Rouge Dev. Co., Inc. v. Collector of Rev. In that case North Baton Rouge Development was a Delaware corporation which became dormant following a period of buying and developing land for industrial and railway sites. By 1962 the major portion of North Baton Rouge Development’s assets were investments in stocks, which were exclusively managed and controlled by its board of directors and other persons located in the State of Missouri. The court cited the definition of “commercial domicile” from Unit ed Gas Corporation v. Fontenot, as controlling:

“In other words, the ‘commercial domicile’ exists where the principal place of business is located and from which the corporation’s activities function and are managed.”

The court in North Baton Rouge Development chose to ignore the control of the incorporeal moveables in question because merely holding investment was not “doing business”. It ignored evidence that the company’s Louisiana personnel made no decisions concerning the investment, and instead concentrated on “. . . the nature of the management process for North Baton Rouge Development Company in its primary function — the development of Louisiana industrial sites designed to benefit railroad.” In effect, the Supreme Court did not look to management process in Louisiana, but instead chose to rely on other “physical indicia” as follows:

“The only business done by North Baton Rouge Development Company is in Louisiana. It is here that it has developed industrial railway sites. The record does not show that any of its assets are located outside the State of Louisiana except the securities here involved. Its only employees are in Louisiana. Its only office is in Louisiana. Its president is in Louisiana. If North Baton Rouge Development Company can be said to have a commercial domicile in any place, it is in Louisiana and Louisiana alone.”

The court in the above quotation clearly relied upon the location of the company’s “only office” in Louisiana, the fact that its president and other employees resided and carried on its business there, and that its only employees were located there.

From other cases it is clear that mere control, or the right to control, from another state does not determine commercial domicile. In United Gas Corporation v. Fontenot, the Louisiana Supreme Court stated:

“From the foregoing it is obvious that the focal point of all of the business and operations and management and control of this corporation and its subsidiaries spread over this wide and vast area of the Southern portion of the United States— not to mention others, such as construction, budget, maintenance, research, public relations, sales promotion, employee relations, issuance of the annual report to stockholders, etc., with which it was necessarily integrated and which therefore formed an important part of its operations — was, in 1949, and for several years prior thereto, actually functioning from the headquarters of the corporation in the large United Gas Building in Shreveport, Louisiana, almost all of its officers, several directors, and a large staff of employees of the corporation and its subsidiaries living in Shreveport and working in this building. There is no question but that substantially all of the corporation’s activities were carried on in Louisiana, or that it was in Louisiana that its actual control was exercised and its management functioned, and that, certainly, more benefits were conferred upon this corporation by Louisiana than by any other state.”

The cases also indicate out-of-state formulation of policy and general influence of an out-of-state board of directors does not remove a commercial domicile from Louisiana. In Arkansas Fuel Oil Corp. v. Fontenot, the Louisiana Supreme Court stated:

“The point is strongly urged that none of plaintiff’s meetings of its board has ever been held in Louisiana; that during the years 1946,1947 and 1948, all of its board meetings as well as those of its subsidiaries were held in the City of New York and there the policies of the corporation were formulated. But the place where the board’s meetings were held would seem to be immaterial in fixing the situs where the intangibles of the corporation could be taxed unless the carrying out of its policies and the management of the corporation’s business were, in a large part, conducted at that same place.”

The following statement was made by the Board of Tax Appeals in its written reasons:

“The evidence shows that the ‘commercial domicile’ of Pelto as defined in the United States Supreme Court case of Wheeling Steel Corporation v. Stokes was the state of Louisiana and not Texas. The ‘commercial domicile’ will depend on the facts and circumstances of each case. In the cases at bar the principal place of business, the place where the corporation’s activities function and/or managed, the place ‘management functions’ is Louisiana. This is true even though it is evident that policy and possibly the highest level management decisions may have been made without the state. The state of Louisiana obviously furnished to Pelto the bulk of the governmental protection of that corporation.”

It is the opinion of this court that Pelto “functioned” and its business was managed and carried out in New Orleans. Pelto's principal business function is obtaining geological data and engaging in the production of oil and gas. This function was carried on in New Orleans and not in Houston. The only business office independent of and not part of its parent company was in New Orleans. It had no office available to the general public in Houston, no mailing address, and no listed telephone. Its books and records of day-to-day operations were kept in New Orleans, and there was no independent Pelto staff in Houston. Its secretarial, bookkeeping, leasing, geological, and engineering staff were all located in New Orleans. A functioning management controlling employees which kept books, made plans, prepared budgets, made sales, contracted for services, collected money, paid bills, salaries, and other obligations, existed in New Orleans under a president who conducted day-to-day operations. As urged by the Collector, we feel the New Orleans office was the “focal point” of Pel-to’s business.

To be sure, the personnel in Houston had some degree of influence over the affairs of New Orleans. However, the Houston personnel and board members came to New Orleans to be informed about current operations. This fact is significant because it was the staff at New Orleans which had the operational information on what business activities Pelto was doing, which obviously controlled the prospects for its profitability. Moreover, the influence exercised by the chairman of the board and chief executive officer of Pelto was primarily focused upon controlling the deposits of the securities attempted to be taxed in this case. In the North Baton Rouge case, the court held direction of investment of corporate funds in securities is not the type of business activity which may establish commercial domicile. Throughout the record, the influence of the chairman of the board and chief executive officer of Pelto over its oil development and exploration activities is set forth in terms of suggestions, guidelines, prohibitions, policies, and similar phraseology. The president of Pelto did consult with the chief executive officer in Houston, and the latter sometimes exercised his power in routine business decisions. But even if the “high level management decisions” with Pelto were made by Southdown through common officers of Pelto, the detailed implementation and exercise of the policies were left as a matter of business to Pelto in New Orleans.

The commercial domicile of a business cannot be at some remote location where an individual, or even two or three of the higher officers of a corporation, may be located, particularly if there is no office, staff, or other physical indicia of management functioning at that location. In the present case the officers of Pelto, being in actuality the officers of Southdown, and expending no more than 25% of their time with Pelto under a management contract, does not present a factual situation sufficient to establish a commercial domicile for Pelto in Houston at the location of its parent company.

Consequently, we hold the commercial domicile of Pelto was in New Orleans, and that the Collector correctly assessed income and corporate franchise taxes on the securities and the income derived therefrom which had not been afforded a business situs in any one particular location.

For the reasons assigned, the judgment appealed from is affirmed.

AFFIRMED.

      . The Collector proposed assessments of Louisiana income tax against Pelto for 1971, 1972, 1973, and 1974 of $199,616.28 with interest to April 30, 1977 of $76,210.80, totaling $275,-827.08. For the same years, the Collector proposed franchise tax assessments against Pelto of $62,035.50 with interest to April 30, 1977 of $28,081.61, totaling $90,117.11. For the years 1972, 1973 and 1974, the Collector’s proposed assessments of franchise tax against South-down was $17,688.50, with interest to April 30, 1977 of $8,083.52, totaling $25,772.02.

      . However, the Houston office was not separately identifiable, was not listed in the telephone directory, and did not have its own separate address.

      . It is not clear whether this $10,000 management fee completely compensated Southdown for services rendered on behalf of Pelto by the officers in Houston.

      . See Humble Oil & Refining Company v. Calvert, (Tex.), 414 S.W.2d 172.

      . 241 La. 488, 515, 129 So.2d 748, 758.

      .See North Baton Rouge Dev. Co., Inc. v. Collector of Rev., La.App., 294 So.2d 571, in which the court found no business situs anywhere for the various stock involved in the case.

      . 298 U.S. 193, 56 S.Ct. 773, 80 L.Ed. 1143.

      . La., 304 So.2d 293.

      . 241 La. 488, 509, 129 So.2d 748, 756, supra, note 5.

      . The Louisiana Supreme Court in North Baton Rouge Development Company also noted approvingly the United States Supreme Court’s holding in Wheeling Steel Corporation v. Fox, 298 U.S. 193, 56 S.Ct. 773, 80 L.Ed. 1143, supra, note 7.

      . La., 304 So.2d 293, 298.

      . 241 La. 488, 560, 129 So.2d 748, 774, supra, note 5.

      . 225 La. 166, 181, 72 So.2d 465, 470-471.

      . The chairman of the board of Pelto was also the chairman of the board of Southdown, Inc.


source: Caselaw Access Project

author: SAMUEL, Judge.

license: Public Domain

text:
    Mazel Mitchell LANDECHE v. Marilyn WEAVER and Allstate Insurance Company.
    No. 10698.
    Court of Appeal of Louisiana, Fourth Circuit.
    May 13, 1980.
    Brown & Williams, Jack A. Williams, Shreveport, for plaintiff-appellant.
    Donovan & Lawler, Christopher E. Law-ler, Metairie, for defendants-appellees.
    Before SAMUEL, BOUTALL and GARRISON, JJ.
   SAMUEL, Judge.

Plaintiff-appellant seeks an increase in the amount awarded for personal injuries she sustained as a passenger in a two-car collision. That is the only issue before us on this appeal. Liability is stipulated. The jury award, which was made the judgment of the court, was in the sum of $1,537, of which amount $537 was for medical expenses.

Medical evidence relative to plaintiff’s injuries was given by Dr. Vernon R. Kroll and Dr. Kenneth Saer. Lay testimony relative to injuries was given by plaintiff (a guest passenger), and the driver of the car, Mrs. Mildred C. Deboutte (plaintiff’s sister-in-law).

Dr. Kroll testified (by deposition): He first saw plaintiff two days after the accident, on August 19, 1977. She complained of injuries to her back and knees and denied prior difficulties in these areas. He diagnosed her injuries as contusions of both knees with swelling of the right knee and spasm of the lumbosacral area of the back. X-rays of both knees showed no evidence of fracture, dislocation, bone disease or joint abnormality. Treatment consisted of physiotherapy (heat, massage and semisound) and prescriptions for the relief of pain and muscle spasm. Physiotherapy was conducted by trained personnel in the doctor’s office. He did not see her on each occasion, but did see her ten times between August 19, 1977 and January 31, 1978. Plaintiff was discharged November 1, 1977. She returned January 13, complaining of soreness in the left knee. No swelling was evident, but because of these complaints she was referred to Dr. Kenneth Saer, an orthopedic specialist.

Dr. Kroll further testified: Plaintiff returned for a last visit on January 31, with discomfort in the knees in flexion and extension, more on the left. At that time there was no evidence of laxity of the knees, and no swelling. No treatment was necessary. He agreed with Saer’s conclusion that the complaints were referable to chondromalacia, which is a roughening of the cartilage surface of the back of the kneecap. Prior to her discharge on November 1, her right knee and left knee were aspirated, each on one occasion. The right knee was aspirated on September 6, 1977 when she had crepitation and swelling in that knee. That knee improved but on September 30, 1977 she complained of the left knee, so that also was aspirated. Plaintiff was placed on a steroid (aristocourt) for a week prior to her discharge on November 1, 1977. He had treated plaintiff in 1969 for aching discomfort in the left knee. As a result of an accident in October, 1969 plaintiff had complained of neck pain and four days later of knee pain. He was unable to give a prognosis of future knee problems plaintiff might experience after his deposition was taken.

Dr. Saer testified: He saw plaintiff on one occasion, January 17, 1978 at the request of Dr. Kroll. His examination was limited to the left knee, using the other knee for comparison. X-rays were normal and showed no evidence of arthritis. She had symptoms and findings of cracking in the knee with motion which indicated a chondromalacia which is a mild form of arthritic change not seen on the x-ray. He was of the opinion there was some degree of fissuring, cracking, or fraying of the joint surface. Typical symptoms of chon-dromalacia are some discomfort with squatting or weight bearing when the knee is bent going up or down steps. Pain would be a nuisance type. Crepitus describes the sound or rough feeling as a piece of sandpaper moving over an object. It does not necessarily mean there is any discomfort associated with it. Chondromalacia most commonly occurs with the aging process but can be produced by injury. Treatment is to avoid squatting, stooping and climbing and the use of aspirin or bufferin.

On cross examination Dr. Saer stated plaintiff told him she had no previous discomfort or injury to the knee and did not mention her accident nine years earlier. His examination was essentially negative except for mild crepitus. He concluded she had a normal knee for a 56 year old lady. She should not require much in the way of pain medication and nothing other than aspirin or bufferin would be advisable. While he thought she walked with a limp, he would not expect a limp from the history and findings of his examination. A brace would be neither helpful nor advisable, although some type of support (such as elastic) might be helpful, but he did not think it necessary. He was of the opinion plaintiff’s condition did not require treatment.

Mrs. Mildred C. Deboutte, plaintiff’s sister-in-law and the driver of the car in which plaintiff was a passenger at the time of the collision in suit, testified that plaintiff struck her head on the windshield and her knees on the dashboard. The witness was too upset to get out of the car but plaintiff got to a telephone and called for help. Plaintiff’s knees were black and blue. At the present time plaintiff is only able to bowl once a week. They bowl every Friday for 1 hour and 45 minutes in the same league.

Plaintiff testified: She hurt her head, back and knees. The bump on the head lasted for a day or two, but headaches persisted longer. She was unable to get an appointment with Dr. Kroll, her family physician, for two days. He treated her knees with painful injections and sent her home with instructions to use ice packs on the knees and stay in bed. She denied prior trouble with her knees and stated she can’t kneel in church, can’t wear dresses, and only bowls once a week, although she used to bowl twice a week. She can’t climb stairs or stand up for long periods. She is in constant pain, even waking up at night. Before the accident she did all of her own housework, but now her daughter has to help because of the pain in her knees and back. She takes Valadol, Bufferin and Tylenol every two hours for the knee pain. She also wears braces because it helps with her knees, although it was not recommended by the doctor.

It appears to us the medical evidence did not establish to the jury’s satisfaction that plaintiff had a serious knee injury and we find no manifest error in such a conclusion. Her present complaints are concerned almost entirely with the left knee and Dr. Kroll’s testimony establishes an injury to that knee prior to the accident in suit. Yet she told Dr. Saer she had not had that prior injury. In addition, although plaintiff complains of constant pain severe enough to require medication every two hours, which is considered unnecessary and too strong by the doctors, wears a knee brace of which Dr. Saer disapproves, and complains of inability to stoop, climb stairs and stand for long periods, she is able to function in a bowling league on a regular basis. Dr. Saer also concluded plaintiff had a normal knee for a lady of her age.

While the award of $1,000 for pain and suffering may seem low, under the circumstances we cannot say the jury abused its much discretion in determining the amount of this award.

For the reasons assigned, the judgment appealed from is affirmed.

AFFIRMED.

      . Injecting local anesthetic beneath the skin and slipping a needle behind the kneecap he withdrew 4 cc’s of fluid.


text:
    Darryl J. CARIMI v. DIRECTOR, DEPARTMENT OF SAFETY AND PERMITS, CITY OF NEW ORLEANS.
    No. 10747.
    Court of Appeal of Louisiana, Fourth Circuit.
    May 13, 1980.

      Darryl J. Carimi, Gretna, in pro. per., for plaintiff-appellee.
    Miranne & Miranne, Ira J. Middleberg, New Orleans, for Mrs. Guy Willian, interve-nor-appellant.
    Before SAMUEL, BOUTALL and GARRISON, JJ.
   SAMUEL, Judge.

This appeal has been taken by an appellant who was not a party to the trial proceeding.

Originally, plaintiff filed suit against the City of New Orleans for injunctive relief to prevent the City from stopping work on a carport being constructed by him on his residence and for a building permit for that construction. After a trial on the merits, there was judgment denying injunctive relief and refusing to compel the City to issue a building permit because the trial judge found the carport was being constructed in excess of height restrictions for accessory buildings under the Building Code of the City of New Orleans. The sole issue before the trial court was the height of the proposed structure.

Neither the plaintiff nor the defendant City appealed. However, an adjacent landowner, not a party to the suit in the district court, by intervention or otherwise, has appealed from that judgment. In the brief filed by appellant in this court she contends only that the trial court erred in finding the height of the proposed structure was 14' 6" rather than 16' V2" and seeks only that “the judgment of the lower court should be amended accordingly.”

We are informed, without denial, that subsequent to rendition of the judgment appealed from, plaintiff met with the director of the Department of Safety and Permits, worked out satisfactory alterations to his building plan, and the City issued a new permit pursuant to which the carport was completed. Accordingly, if that information is correct, the controversy as it existed between the original parties has now been terminated, neither has appealed, and any action by this court on the issue of plaintiff’s right to a building permit for the carport, designed before the change, the basic issue before the trial court, is moot. And we must dismiss this appeal even if that information is not correct.

In this court appellant attempts to raise the issues of her right to privacy, air space and light, which she asserts are violated by the carport. She also attempts to raise the issue of diminished property value. These issues were never before the trial court, no judgment was rendered thereon, and the record is devoid of any evidence even tending to support these contentions.

In Balis v. Mitchell, the court made the following statement:

“. . . it is well-settled that one appealing from a judgment rendered in the suit to which he was not a party must take the record as he finds it and unless it be shown that the judgment is erroneous as between the parties to the suit or that it is the result of fraud and collusion on their part, he cannot complain.”

Here there is no suggestion of fraud or collusion, and whether or not the judgment is erroneous is immaterial insofar as appellant is concerned. In refusing to order issuance of the permit and in refusing to grant injunctive relief, the judgment appealed from gives to appellant all the relief she could possibly obtain in this suit as filed and tried. As so filed and tried, we can give her no additional relief.

Without the issues now raised by appellant (as has been pointed out, we cannot consider those issued on this appeal) there is no controversy for this court to decide. Because there is no valid issue for this court to consider, the appeal must be dismissed.

For the reasons assigned, this appeal is dismissed. All costs in this court are to be paid by the appellant.

APPEAL DISMISSED.

      . In violation of Art. 10, § 12, No. 4 of that code, which provides such an accessory building shall not exceed 14' in height.

      . La.App., 48 So.2d 691, 695; see also Haas v. Haas, 182 La. 337, 162 So. 5; Mutual Life Ins. Co. v. Houchins, 52 La.Ann. 1137, 27 So. 657.

      . See C.C.P. Art. 2082.

      . See Upper Audubon Ass’n. v. Audubon Park Com’n., La.App., 329 So.2d 209; Verdum v. Scallon Brothers Contractors, Inc., 263 La. 1073, 270 So.2d 512. We note that while we did deny a prior plaintiff motion to dismiss this appeal, the matter is one which properly addresses itself to a full consideration of the record, including a consideration of the merits.


text:
    Raymond E. McGOWAN v. Deborah FARRIS, William H. Farris and Commercial Union Assurance Companies.
    No. 10444.
    Court of Appeal of Louisiana, Fourth Circuit.
    May 13, 1980.
    Frank B. Hayne, III, New Orleans, for plaintiff-appellant.
    Drury & Lozes, James H. Drury, New Orleans, for defendants-appellees.
    Before SAMUEL, REDMANN and SCHOTT, JJ.
   SAMUEL, Judge.

Plaintiff instituted this suit for personal injuries received in an automobile accident when his automobile was struck in the rear while stopped in traffic. Named defendants are the driver of the other vehicle involved, her husband, and their automobile liability insurer.

The matter is before us only on the issue of quantum. Plaintiff contends the award of $5,245 is an abuse of discretion in view of the serious injuries involved. He prays for an increase in the award. The injuries of which plaintiff complains are strain of neck which lasted for one month and tinnitus (ringing and buzzing in the ear), which manifested itself within one day of the accident and is permanent.

Plaintiff testified his neck muscles hurt after the accident and the following morning upon awakening he had a ringing noise in his ear. This noise (tinnitus) is with him constantly since the accident. He is a 43 year old college professor who spends much time in the library because of his need for quiet surroundings. The only time he is not aware of the ringing and buzzing in his ear is when he is in deep concentration, such as reading a novel, in noisy places like an airplane or in heavy traffic, or at a party where people are talking and music is playing. If he consumes alcoholic beverages at a party, the following day the noises will be even louder. He is remodeling a house and must wear ear plugs while hammering, because the hammering affects the sound, making the ringing worse.

The tinnitus affects him professionally as he hears it while teaching class. He is also disturbed while listening to classical music, or performing chamber music.

The accident occurred on May 12, 1975. Dr. Gernon Brown testified he saw plaintiff on May 28, 1975, took a history, x-rays, and performed an orthopedic examination of the neck and back. Plaintiff complained of discomfort in those areas and tinnitus in his ears. Examination of the neck and back revealed no spasm and x-rays showed no fracture or dislocation. Dr. Brown concluded plaintiff had sustained a strain following the accident and advised plaintiff to return if the symptoms persisted. The doctor stated tinnitus is a common complaint after automobile accidents, but is outside the area of his specialty.

Plaintiff next consulted Dr. Harold G. Tabb, an ear, nose and throat specialist. Dr. Tabb testified: He examined plaintiff June 25 and July 24, 1975. His chief complaints were ringing in both ears, present since an automobile accident the previous month. It was more pronounced in the left ear. Examination was essentially normal with slight loss of hearing at 4,000 cycles per second. Hearing bilaterally for speech was within normal limits. Robaxin was prescribed for complaints of soreness of the neck muscles. On plaintiff’s return visit in July this complaint had subsided and no further treatment was deemed necessary.

An audiogram was repeated on the July visit and significant improvement was noted over the previous audiogram. When last seen November 29, 1977 plaintiff continued to complain of ringing in the left ear, still present since the May, 1975 accident.

Dr. Tabb stated ringing in the ears following an automobile accident is fairly common but if the accident is the cause it would appear immediately after the accident. Tinnitus can occur from many causes, which were described by the doctor. There is no objective test for tinnitus, since it is a subjective complaint. The doctor concluded that if plaintiff did have ringing in the ears at the time of trial, the condition, having lasted so long, would be permanent.

On September 9, 1975, plaintiff saw Dr. William A. Martin, a neurologist and a specialist in electrodiagnosis, a diagnostic procedure in which the nerves and muscles are tested electrically for evidence of neuro-muscular disease. Dr. Martin testified a history was taken and a neurological examination performed. Plaintiff had no discomfort of the neck, but noticed high pitched whistling in his ears bilaterally, aggravated by exertion.

The doctor found no neurological deficit or neurological etiology for tinnitus and was unable to detect any hearing loss. However, it must be noted, as indicated by the doctor, that he had only crude means of examining plaintiff’s hearing (listening to a watch tick, listening to a tuning fork). Plaintiff was given a prescription for buti-sol for the relief of tinnitus.

On January 30 and March 18, 1976, plaintiff saw Dr. Charles I. Berlin, an audiologist (specialist in the measurement of auditory functions). On each occasion tests were performed to determine how acutely plaintiff heard and responded to the ringing sensations principally in the left ear. The doctor stated plaintiff had a slight hearing loss in the 4,000 cycle range. There was no change noted the second time the test was given. A Bekesy Tracing test was performed to evaluate plaintiff’s hearing and to rule out the possibility of tumors.

The trial judge based his award of $5,000 for pain and suffering on a neck injury of one month duration and “some form of ear disturbance which causes discomfort ‘which tends to be aggravated by exertion’ ”. He was impressed with medical evidence that tinnitus is a subjective complaint and may result from other causes, since plaintiff did not strike his head, suffer any vertigo (dizziness), headaches or hearing loss at the time of the accident, which is usually expected in tinnitus cases.

We agree that the medical evidence of plaintiff’s own physicians does not support a finding of serious medical impairment. Thus, we conclude that the trial court did not abuse the much discretion granted to it under C.C. Art. 1934(3).

For the reasons assigned, the judgment appealed from is affirmed.

AFFIRMED.

      . The report of Dr. Herbert W. Marks concerning otovestibular testing, ordered by Dr. Berlin, was introduced in evidence.

      . Plus $245 medical expenses for a total of $5,245.

      . See Gaspard v. LaMaire, 245 La. 239, 158 So.2d 149; Coco v. Winston Industries, Inc., La., 341 So.2d 332; Reck v. Stevens, La., 373 So.2d 498.


text:
    Charles L. KELLY v. CITY OF NEW ORLEANS.
    No. 10865.
    Court of Appeal of Louisiana, Fourth Circuit.
    May 13, 1980.

      Joseph W. Thomas and Ronald C. Davis, New Orleans, for plaintiff-appellee.
    Donald A. Hoffman, City Atty. and Delbert G. Talley, Deputy City Atty., New Orleans, for defendant-appellant.
    Before SAMUEL, LEMMON and GU-LOTTA, JJ.
   SAMUEL, Judge.

Plaintiff filed this suit for workmen’s compensation benefits, penalties and attorney’s fees. The sole defendant is his employer, the City of New Orleans. Following trial there was judgment in favor of plaintiff holding him entitled to compensation benefits from June 4 to July 6,1978, restoration of sick leave of which he had been deprived, the statutory penalty, $750 for attorney’s fees, and $315 for medical services rendered by Dr. Dominic Condie. The defendant has appealed. Plaintiff has answered the appeal as explained hereinafter.

On May 30, 1978 plaintiff, a New Orleans patrolman, was injured when a squad car in which he was riding as a passenger was involved in an accident. He made a written report the following day indicating his left shoulder had been injured, and that he had previously injured the same shoulder in a prior incident at the police academy while in training some eighteen months earlier.

On June 2, 1978 plaintiff was seen by Dr. Condie who is paid by the City. Dr. Condie performed an examination, took x-rays, and diagnosed plaintiff’s injuries as pulled muscles in the left shoulder. Plaintiff received therapy until July 7, 1978 when he was released to return to limited duty. The City concedes it made a mistake in not paying plaintiff compensation benefits from June 4 to July 7.

On July 14 plaintiff returned to Dr. Con-die stating he had reinjured the same shoulder while teaching his child how to swim. Dr. Condie referred plaintiff to Dr. Roy Marrero, an orthopedic surgeon.

Plaintiff told Dr. Marrero he first dislocated his shoulder at the police academy and had several recurrences since that time, including the automobile accident of May 30. He did not mention the swimming pool incident.

On some occasions plaintiff had described his injury as a shoulder separation and it appears he was unaware there is a difference between a separation and a dislocation. Dr. Condie did not find plaintiff had either, because there would have been some evidence in the x-rays taken on June 2. But, without examining Condie’s records or ordering x-rays taken, and in spite of the fact that the physical examination was negative for dislocation, Dr. Marrero performed surgery on plaintiff’s shoulder because of the history given him by plaintiff.

The trial court refused to award compensation benefits after July 7, 1978, finding the incident at the pool and the subsequent operation were not work related.

Appellant contends the trial court erred in: (1) Awarding plaintiff penalties and attorney’s fees; and (2) casting it in judgment for Dr. Condie’s bill.

Appellant’s first contention is based upon two-fold reasoning. First, it is claimed the City’s failure to pay any compensation benefits was based upon a departmental error which was neither arbitrary nor capricious. The error occurred because the police department treats injuries received while responding to a call as I.O.D. (Injured on Duty), and these employees receive full pay for a maximum of six months. Employees injured in the course and scope of their employment other than I.O.D. are dealt with under workmen’s compensation.

Before a police officer can be classified I.O.D. the claim must be approved by the Civil Service Commission. Plaintiff’s claim under this provision was denied by the Commission, apparently because, although plaintiff was responding to a call, he indicated on his first written report of this injury that he had previously injured his left shoulder in an accident at the police academy. When the I.O.D. designation was refused, appellant should have notified its compensation adjuster so that plaintiff could be placed on compensation. This was not done.

It is unfortunate that the error was made, but the City was aware of plaintiff’s accident and resultant injury, and it was its duty to pay him either under I.O.D. or workmen’s compensation. Failure to pay under either provision, causing plaintiff to have to use his sick leave, was arbitrary and the award of penalties and attorney’s fees is proper.

Plaintiff’s alternative claim under this contention is that penalties and attorney’s fees are costs from which the City is exempt under the provisions of R.S. 13:4521. In pertinent part that statute does state parishes and municipalities are not required to pay court costs other than stenographer’s costs for taking testimony.

We have not been cited to, nor have we been able to find, any authority to support appellant’s claim that penalties and attorney’s fees are items of “cost”. Accordingly, we hold appellant’s first contention is without merit.

However, we do agree that appellant should not have to pay Dr. Condie’s bill of $315. Dr. Condie is a salaried employee of the City who renders medical services to the police department in line with his duties to the City. A dispute has arisen between Condie and the City as to whether he is entitled to be paid additional fees for the use of his office and equipment. This dispute is of no concern to plaintiff. Plaintiff is not obligated to pay for medical services to which he is entitled by reason of his treatment by the city medical doctor. The City is already paying Dr. Condie for such services and, on the record before us, should not have to pay these additional charges.

ANSWER TO THE APPEAL

In answer to the City’s appeal, plaintiff contends he is also entitled to compensation benefits and medical expenses from July 20 to December 2, 1978, an additional award for attorney’s fees by reason of this appeal and, alternatively, that the matter be remanded for newly discovered evidence.

When, during trial, plaintiff testified he originally had suffered a separation or dislocation of his left shoulder at the police academy, he was unable to offer any proof thereof other than his own testimony because, in response to a subpoena duces te-cum, the City produced his employment file which did not contain such information. However, we are informed in brief that, after trial, the City found a copy of the accident report to which plaintiff referred and sent it to him stating it had been misfiled. A copy of the report and affidavit was attached thereto. The City does not deny this.

Since it was not the fault of plaintiff that his employment records were incomplete and the trial judge thus was not presented with the true facts, plaintiff is entitled to a determination of whether or not the initial injury was related to his shoulder problems subsequent to July 7, 1978. If so, he is entitled to further compensation benefits. We remand for a determination of those questions.

We agree plaintiff is entitled to an additional award for attorney’s fees for this appellate appearance and we consider as reasonable an additional award of $500 (making a total award of $1,250).

For the reasons assigned, the judgment appealed from is reversed in part to delete the award of $315 for Dr. Condie’s medical services, and amended in part to increase the award for attorney’s fees to the sum of $1,250. In all other respects the judgment appealed from is affirmed, and the matter is remanded to the lower court for further proceedings in accordance with the views expressed herein.

AMENDED AND AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.

      . But stating that plaintiff was not entitled to any money award because he had been paid full salary though charged with sick leave for it.

      . To prevent the recurrence of this error in the future the City’s adjuster is now being sent information on the I.O.D. as well as the compensation determinations.

      . In this connection see Op.Atty.Gen. June 13, 1955 which states that attorney’s fees as contemplated in this section are NOT included in the term “court costs”.


text:
    WHIRLPOOL CORPORATION v. SAIA MOTOR FREIGHT LINE, INC.
    No. 10888.
    Court of Appeal of Louisiana, Fourth Circuit.
    May 13, 1980.
    Favret, Favret, DeMarest & Russo, Clarence F. Favret, Jr., New Orleans, for plaintiff-appellee.
    Duval, Arceneaux, Lewis & Funderburk, James M. Funderburk, Houma, for defendant-appellant.
    Before SAMUEL, SCHOTT and HOOD, JJ.

         Due to the death of Judge HOOD prior to rendition, but after his concurrence therein, this opinion is rendered unanimously by SAMUEL and SCHOTT, JJ.

   SAMUEL, Judge.

Plaintiff, an appliance manufacturer, instituted this suit against defendant, a motor freight carrier, for the sum of $1,433.25, the amount due on a c.o.d. shipment which defendant failed to collect from a consignee who went bankrupt. Judgment was rendered in favor of plaintiff in the amount claimed. Defendant has appealed.

The facts are as follows: On September 27, 1977 plaintiff prepared two bills of lading covering household appliances to be shipped to the same consignee. Both called for collection on delivery, one for the sum of $1,433.25 and the other for $613.20.

Both shipments were received by the carrier on September 20 and for the purpose of a more favorable freight rate were treated as one by the defendant. When the merchandise was delivered to the consignee defendant collected only $613.20, the amount shown on the second page.

In this court appellant contends there was only one bill of lading consisting of two parts, and thus they were correct in collecting only the amount shown on page 2 or, alternatively, the negligence of appellee was responsible for the failure to collect the full amount of c.o.d. charges. We do not agree with either contention.

Appellant relies on two alleged violations of the National Motor Freight Classification Tariff 100-E which shippers and carriers are required to follow. That provision reads in pertinent part:

“SECTION 1.
Shipments must be tendered on ‘Uniform straight’, ‘Straight Bill of Lading — Short Form’, or ‘Straight’ bill of lading forms as shown on pages 256 through 259, 263 and 264 of the Classification.
The letters ‘COD’ must be stamped, typed or written on all such bills of lading and shipping orders immediately before name of consignee; OR, ‘COD’ in red letters at least one (1) inch in height with thickness of stroke 14 inch thick or greater must be stamped or printed across the face of all bills of lading and shipping orders. Only one COD amount may be shown and may not be subject to change dependent upon time or conditions of payment. The name and street and post office address of consignor and consignee must be shown on bill of lading and shipping order.”

The first violation complained of is that the stamped c.o.d. letters in red at least one inch in height and xk inch thick appear only in one place on the two-part bill of lading, namely on the second page, calling for collection of $613.20, and NOT on the first page, calling for collection of $1,433.25.

We note on the original bill of lading, the letters “COD” are typed immediately before the name of the consignee, which complies with the above quoted provision, and is also prominently noted with asterisks elsewhere on the bill calling for collection on delivery of $1,433.25 on Bill of Lading # 11073035, and for collection on delivery of $613.20 on Bill of Lading # 11703036.

The stamped “COD” to which appellant refers is shown only on the freight bills introduced in evidence by appellant, indicating appellant stamped “COD” only on the second bill of lading. Since the stamped “COD” appears only on the appellant freight bill and not on the bill of lading, it is clear that it and not the appellee treated the two bills of lading as one. It also is clear that each bill of lading had a different number and that both bills were clearly and prominently marked to indicate different c.o.d. charges.

The fact that the shipments were picked up from appellee on the same day for delivery to the same consignee may have led appellant to regard both shipments as one order, but there is no evidence in the record showing appellant was misled by appellee, or that the latter violated any rule of the National Motor Freight Classification Tariff 100-E, particularly in view of the fact that appellee did show only one c.o.d. amount on each bill of lading. If appellant regarded the two bills of lading as one bill consisting of two parts, it did so at its own peril and due to its own negligence, and not due to negligence on the part of appellee.

For the reasons assigned, the judgment appealed from is affirmed.

AFFIRMED.

      . Testimony indicated the freight bills are prepared by photocopying the bill of lading and superimposing the carrier’s heading.


text:
    HINCHMAN ELECTRICAL CONTRACT MAINTENANCE CORPORATION et al. v. LITTON SYSTEMS, INC., et al.
    No. 10578.
    Court of Appeal of Louisiana, Fourth Circuit.
    May 13, 1980.
    Jack N. Rogers, Baton Rouge, for plaintiffs-appellants.
    Barham & Churchill, Earl S. Eichin, Jr. and Charles F. Thensted, New Orleans, for defendant-appellee.
    Before SAMUEL, LEMMON and GU-LOTTA, JJ.
   SAMUEL, Judge.

Plaintiffs, Marshall Hinchman, president and sole owner of/and Hinchman Electrical Contract Maintenance Corporation, instituted this suit for the balance due for. extras for electrical work at the Colonial Sugar Refinery at Grammercy, Louisiana, and for damages to their professional standing and credit rating.

Named defendants were Litton Systems, Inc. and Colonial Sugars-Borden Food Division of Borden, Inc. (The latter defendant was subsequently dismissed on an exception of no cause of action on the ground that plaintiffs were not parties to the construction contract between Litton and Borden.)

An intervention was filed by the Bank of St. Charles and Trust Company, as holder of a pledge by plaintiffs, for recognition of its pledge rights.

Litton filed exceptions of no cause or right of action and answered in the form of a general denial. Following a trial on the merits judgment was rendered in favor of Litton, dismissing plaintiffs’ demands, alternatively maintaining Litton’s exceptions, and dismissing the Bank’s intervention. Plaintiffs have appealed.

The record reveals the following facts: Litton contracted with Borden to install a palletizer system and related conveyor at the Colonial refinery. On March 16, 1973 Litton subcontracted the electrical portion of the work to the Hinchman corporation on its low competitive bid of $32,386.15. The contract provided the work was to be completed within 90 days, and that all changes in the scope of the work were to be made or confirmed in writing.

Extra work not contemplated in the original contract was performed and Hinchman was paid an additional $7,758.58, and took nine months to do the job. (According to Hinchman the extra work amounted to $55,409, which Litton refused to pay.)

As a result of the time it took to complete the contract plaintiffs’ costs for labor and overhead escalated, causing him financial problems at the bank, and for all practical purposes putting him out of business, subjecting him to seventeen law suits by the bank, and resulting in an IRS tax lien.

It is plaintiffs’ position that these misfortunes are the fault of Litton in: (a) causing delays which prevented prompt performance of the contract; (b) issuing change orders verbally instead of in writing, and then refusing to pay for the same; and (c) inducing plaintiff to make a bid based upon misrepresentation. As a result of the above allegations plaintiffs ask for release from their original contract and payment on a cost basis or, alternatively, quantum meruit.

Relative to appellants’ first contention, the delays of which they complain were due principally to obstructed working areas. They contend the floors were torn up and the aisles blocked during the entire working period. This contention is not born out by the evidence. While the aisles may have been blocked by stored sugar at times, Colonial cooperated by moving the sugar when its location created problems.

Plaintiffs knew, or should have known, they were to perform the work at an operating refinery, that the ordinary work in the refinery would continue, and that the refinery certainly would not close down for 90 days while a $32,386.15 contract for electrical work was being performed. And it appears to us much more likely that the delay in performance was due to the fact that plaintiffs’ original crew of experienced electricians returned to their original jobs at Shell Oil Corporation Refinery when that company’s employees went back to work after they had been out on strike, and plaintiffs had to hire inexperienced and less competent help.

Relative to appellants’ second contention, we find insufficient evidence to support an award for extras allegedly unpaid at this time. Hinchman received $7,758.58 for extra work not covered by change orders over and above the contract price, including payment for additional materials, labor and delays in completing the job. Hinchman asks to recover for an additional 4775 man hours representing extra work or lost time. However, they admit these employees were not paid for any hours that were lost because they could not work on the project. Hinchman claims they still had “overhead”, but this is not the responsibility of the defendant.

We also conclude there is no merit in appellants’ contention, that their bid was made upon false representations. Plaintiffs’ estimator knew the work was to be performed while the refinery was in full operation and that the contract was for a fixed price, and open to bids. It is unfortunate that the bid was unrealistically low, but that is not the fault of Litton.

There is no basis for us to set aside the original contract and require that appellants be paid on a cost basis or in quantum meruit. Any damages Hinchman and/or his corporation suffered as an unfortunate result of this contract appear to have been caused by their own inadequate bid and substandard performance.

Based upon Hinchman’s pledge to the Bank, Litton filed an exception of no right or cause of action at the close of plaintiffs’ case. The thrust of these exceptions is that the proper party plaintiff is the Bank, and that Hinchman has no right to sue Litton under the contract. As we have said, the trial court judgment alternatively maintained these exceptions and dismissed plaintiffs’ suit. Because we decide this matter on the merits in favor of defendant, our consideration of the exceptions is unnecessary.

For the reasons assigned, the judgment appealed from is affirmed.

AFFIRMED.


author: REDMANN, Judge.

text:
    ST. JOHN THE BAPTIST PARISH POLICE JURY v. STATE of Louisiana.
    No. 10839.
    Court of Appeal of Louisiana, Fourth Circuit.
    May 13, 1980.
    C. William Bradley, Jr., Becnel & Fau-cheux, Reserve, for plaintiff.
    Robert J. Caluda, Louisiana Dept, of Justice, New Orleans, Harry J. Morel, Jr., Dist. Atty., 29th Judicial District Court, Edgard, for defendant.
    Before SAMUEL, REDMANN and GARRISON, JJ.
   REDMANN, Judge.

The Police Jury of St. John the Baptist Parish sued the State to obtain a declaratory judgment relative to statutory provisions on the location of the Parish Treasurer’s office. The judgment ordered the Police Jury to pay all court costs in the matter. The Police Jury appeals only from the order to pay all costs, contending that it can be cast as plaintiff only for the stenographer’s costs. On the facts of this case we agree and we so amend the judgment.

Although the general rule of La.C.C.P. 1920 might allow the trial court discretion to impose all costs upon plaintiff, La.R.S. 13:4521 prevents imposing costs on state or political subdivision (save stenographer’s costs), “[e]xcept as provided in R.S. 13:5112

R.S. 13:5112 allows casting “defendant” political entities for costs. The reason for specifying defendant entities is apparently that a non-governmental plaintiff has to pay costs in advance and if such a plaintiff prevails it should be able to recoup its costs, even from a governmental defendant. On the other hand, a governmental plaintiff does not pay costs in advance, and the defendant’s costs are usually trifling by comparison: perhaps a non-governmental defendant who has had to pay those small costs could argue Equal Protection or could argue that the motive-principle of § 5112 is the allowance of recovery of costs by a private litigant who prevails against the government, whether plaintiff or defendant. But that is not our case.

Our case is that of two governmental litigants, neither of whom had to pay costs in advance and neither of whom has a claim against the other for costs paid. Thus the question is whether the governmental offices of Clerk of Court and Sheriff should expend their own public funds to supply services without reimbursement from other public funds held by the governmental plaintiff. This appears to be a question wholly within the discretion of the Legislature, and the Legislature has exempted governmental plaintiffs from costs save stenographer’s costs.

The judgment appealed from is amended to cast plaintiff for costs limited to stenographer’s costs.

      . Unless the judgment provides otherwise, costs shall be paid by the party cast, and may be taxed by a rule to show cause.
      Except as otherwise provided by law, the court may render judgment for costs, or any part thereof, against any party, as it may consider equitable.

      . Except as provided in R.S. 13:5112 and as hereinafter provided, neither the state, nor any parish, municipality, or other political subdivision, public board, or commission shall be required to pay court costs in any judicial proceeding, instituted or prosecuted by or against the state or any such parish, municipality, or other political subdivision, board, or commission, in any court of this state or any municipality of this state, including particularly, but not exclusively, those courts in the parish of Orleans and the city of New Orleans. This Section shall have no application to stenographers’ costs for taking testimony.

      . A. In any suit against any state or any department, board, commission, agency, or political subdivision thereof, the trial or appellate court, after taking into account any equitable considerations as it would under Article 1920 or Article 2164 of the Code of Civil Procedure, as applicable, may award in favor of the successful party and against the state, department, board, commission, agency, or political subdivision against which judgment is rendered, such court costs under R.S. 13:4533 and other applicable law as the court deems proper but, if awarded, shall express such costs in a dollar amount in a judgment of the trial court or decree of the appellate court.
      B. In accordance with Section 10 of Article XII of the Constitution neither the state nor any department, board, commission, agency, or political subdivision thereof shall be required to pay court costs until the judgment rendered against the state, department, board, commission, agency, or political subdivision shall become final and definitive under the provisions of Articles 2166 and 2167 of the Code of Civil Procedure or otherwise nonappealable or non-reviewable beyond the delays set by law for same and the funds have been appropriated therefor in specific dollar amount.
      C. This law shall not apply to, nor shall the Office of Employment Security or the administrator be cast for any court costs in, any judicial review proceeding under the provisions of R.S. 23:1634.


author: BOUTALL, Judge. SCHOTT, Judge,

text:
    SUN FINANCE COMPANY, INC. v. Rev. George BRISCOE a/k/a George Briscoe.
    No. 10804.
    Court of Appeal of Louisiana, Fourth Circuit.
    May 13, 1980.

      Stephen G. Sklamba, New Orleans, for Sun Finance Co., Inc., plaintiff-appellant.
    Al J. Mendoza, Marrero, for Rev. George Briscoe, a/k/a George Briscoe, defendant-appellee.
    Before BOUTALL, SCHOTT and CHE-HARDY, JJ.
   BOUTALL, Judge.

This is a suit by Sun Finance Company against Rev. George Briscoe on a retail installment contract entered into in connection with a purchase of an automobile by Briscoe. Plaintiff sought recovery for $1,735.03 with interest at the rate of 28.4% per year from October 21, 1977, until paid plus 25% of the principal and interest as attorney’s fees. In a reconventional demand Briscoe claimed damages for the loss of the automobile based on plaintiff’s failure to insure the vehicle and damages for embarrassment and humiliation resulting from plaintiff’s having reported defendant to the credit bureau. The trial court awarded plaintiff a judgment on the main demand for the principal amount of its claim with legal interest from date of judicial demand until paid, and attorney’s fees of 25% on the principal amount of the claim only. On the reconventional demand the trial court awarded defendant $2,542.80 for loss of his vehicle, $150 for towing charges and $1,000 for embarrassment and humiliation over the loss of his credit standing. From this judgment Sun Finance Co. has appealed. Briscoe has neither appealed nor answered the appeal.

Issues on this appeal are plaintiff’s entitlement on the main demand to an amount of interest in excess of the legal rate from dare of judicial demand and attorney’s fees of 25% on the principal and interest rather than on the principal alone. On the reconventional demand the issues are whether the record supports the trial judge’s conclusion that plaintiff and its manager violated a duty as defendant’s agent in failing to procure automobile insurance, and, if so, is the amount of damages awarded to defendant under his recon-ventional demand supported by the record.

On November 9, 1976 defendant purchased a 1972 Toyota automobile for $1695, plus $105.75 for taxes and licenses for a total of $1800.75. He paid $400 in cash and financed the balance with plaintiff. In connection with the financing plaintiff arranged for credit life insurance, disability insurance and automobile insurance, the premiums for which were included in the amount to be financed by plaintiff. The transaction was made pursuant to the Motor Vehicle Sales Finance Act, LSA R.S. 6:951 et seq. and the retail installment contract signed by defendant, included all of the above sums together with a finance charge of $632.58. The principal amount of $2542.80 was to be paid out over a 24 month period in 23 installments of $106, and the last installment of $104.80, with the first payment due on December 17, 1976.

Shortly after the automobile’s purchase defendant’s son, while driving it, had an accident with resulting damage in the amount of $1122. The insurance company paid for the repair, less deductible, and on December 30, 1976 issued an endorsement increasing the premium on the insurance policy by $227. This was based on a change in the driver classification from “Single male operator under age 25, not owner or principal operator” to “Single male under age 19; who is owner or principal operator”. The policy was cancelled for non-payment of the additional premium and on April 11, 1977 the automobile, then uninsured, was damaged beyond its value in a second accident.

The primary issue before the court is whether a legal relationship existed between Sun Finance Company, through its employee, and Briscoe which would require Sun Finance Company to act in good faith in securing insurance coverage and whether Sun Finance is responsible in damages for failing to place the insurance coverage or notify Briscoe that it was unable to do so. Sun Finance introduced evidence to the effect that after the cancellation of the original insurance policy, it notified the Briscoes of the fact of cancellation and the necessity for payment of the higher premium in order to reinstate the policy. Briscoe refused to pay the higher premium, and was supposed to secure his own insurance coverage. Opposed to this evidence, Briscoe introduced evidence to the effect that although he was notified of the cancellation of the policy, he was assured by Sun’s employee that Sun would obtain a replacement policy and that assurance coupled with any lack of communication from Sun that the policy had not been obtained, led them to rely upon Sun’s placement of insurance.

The trial judge in assessing the credibility of the witnesses whose testimony was in conflict found that it was not impressed with the testimony of Mr. Armstrong, the employee of Sun Finance, and that Sun Finance had obligated itself to perform the acquisition of additional insurance for Briscoe, and failed to do so without explanation. In the determination of credibility of opposing witnesses, the trial judge has great discretion and his conclusions should not be disturbed absent manifest error. We find no manifest error in the judge’s conclusion, and indeed the surrounding circumstances would tend to support the judge’s determination. We refer to the fact that after the refund check for the cancellation was received by Sun, it was kept by them until after the April 11th accident was reported, and finally credited to Briscoe’s account on April 22nd. Additionally during the time in question, Briscoe continued to pay his usual monthly payment, and made a payment on April 27th as regularly scheduled. It was not until after that payment that Briscoe was informed that no insurance coverage had been obtained and he refused to make any more payments on the account. We agree with the conclusion of the trial judge that under the facts of this case, Sun Finance had obligated itself to acquire the additional insurance and is responsible for loss occasioned by the lack of coverage.

However, we do not agree with the assessment of damages made by the trial judge. The trial judge placed the loss of said vehicle at the sum of $2,542.80, which corresponds to the total amount of the promissory note. Although there is no evidence fixing precisely the value of the vehicle at the time of the loss, we refer to the purchase price of the vehicle showing a total cash delivered price of $1800.75, which includes the price of the car, plus sales tax and license fees. Considering that the vehicle had depreciated somewhat in the several months of use, we conclude that a fair value would be the original cash sales price, $1695.

The next item of damages awarded was the sum of $150 for towing charges. The policy afforded to plaintiff in reconvention showed a maximum limitation of $25 for towing charges. Considering that the obligation was to furnish a similar policy, we hold that only the sum of $25 in towing charges is recoverable.

The last item of damages on the reconventional demand is the award of $1000 for embarrassment and humiliation for having affected the credit status of Briscoe. On this issue there was evidence presented that Briscoe had been refused credit on several occasions as a result of Sun Finance’s activity. There is no evidence of any monetary loss and presumably the judge fixed damages under the general damage provisions of Louisiana Civil Code Article 1934(3). Under that article the trial judge is granted great discretion in assessing damages, and we cannot say that he has erred. Accordingly, we would reduce the amount awarded Briscoe on his reconven-tional demand to the total of $2720.

Passing now to a consideration of the issues raised by appellant on his original demand, we find ourselves limited in consideration because the appellee has neither appealed nor answered the appeal. There is no serious quarrel that the note is past due and owing, but we find that Sun Finance Company quite plainly violated the Motor Vehicle Sales Finance Company’s law by charging a usurious interest contrary to the maximum finance charge limitations in R.S. 6:957. The vehicle was a used motor vehicle falling in class 3 and the maximum finance charge is an amount equivalent to 214% per month simple interest on the declining balance. The promissory note provided for an interest percentage rate of 28.40 percent, and on this appeal Sun seeks to have us to enforce that figure as the interest due rather than the legal interest set by the trial judge. In argument, we are referred to a chart utilized by Sun in an effort to show that it did in fact make a mistake in the placement of the 28.40% figure and actually charged less interest than the maximum. We consider that chart only as argument and point out that either the appellant is wrongfully using the chart or it is adding additional charges not countenanced under the statute.

One of the penalties for violation of R.S. 6:957 is that the appellant “shall be barred from recovery of any finance charge, delinquency or collection charge on the contract.” We note that because Bris-coe has made a number of payments, and that his unearned interest rebate was computed in accordance with R.S. 6:958, that the $1705.03 awarded contains an amount of finance charge which would be barred under § 960(B). Similarly, we would consider the award of 25% attorney’s fees to be also barred as coming within a delinquency of collection charge on the contract.

We have considered reducing plaintiff’s judgment under the provisions of Code of Civil Procedure Article 2164, which provides that we may render any judgment which is just, legal and proper upon the record on appeal. Had the defendant-ap-pellee raised the issue of the statutory violation either in his answer and reconven-tional demand or on appeal or answer to the appeal in this court, we would feel compelled to do so. However, not having been pleaded, we do not consider it permissible to reduce the judgment, but we of course will certainly not increase it as appellant requested. Accordingly, that portion of the judgment is affirmed.

For the reasons hereinabove stated the judgment in favor of plaintiff Sun Finance Company, Inc. on its main demand is affirmed, and the judgment in favor of George Briscoe on his reconventional demand is amended and reduced to the sum of $2720,. and as thus amended is affirmed. Appellant shall pay all costs of this appeal.

AMENDED AND AFFIRMED.

SCHOTT, J., dissents in part.

SCHOTT, Judge,

dissenting in part:

I respectfully dissent from the affirmation of the judgment on the reconventional demand but concur in affirming the judgment on the main demand.

According to plaintiff’s employee Armstrong, when he was notified by the insurance company in January that the additional premium was required he spoke to defendant and Mrs. Briscoe about it, but they informed him that they did not want to spend any more money for insurance. Therefore, his only recourse was to have the policy cancelled. A check for return of premium in the amount of $187 was sent to him by the insurance company. He testified that he spoke to Mrs. Briscoe on different occasions to tell her that he had the return of premium and if she wanted to get insurance with another company this was up to her. All he required was a loss payable clause in his company’s favor on the policy and the return of premium could be used toward the premiums on the new policy. No insurance was ever obtained by the Briscoes and the refund was credited to defendant’s account in April, 1977.

According to Mrs. Briscoe, she got a call from Armstrong after the first accident and was informed that the policy was cancelled but she received no other notice from him until he called to tell her that he had received the $187 return of premium. She informed him to place it on more insurance and was under the impression that he had procured other insurance until after the second accident.

In his reasons for judgment the trial judge made the following findings:

“The testimony at trial, which was uncon-tradicted, showed that SUN FINANCE was capable of, and in fact, did, secure original coverage on said vehicle. Further, this was accomplished by BRISCOE simply by agreeing to allow SUN FINANCE to obtain this coverage and include said cost in the monthly note. The Court is also impressed with the fact that once this coverage was cancelled the draft for unearned premiums was forwarded to SUN FINANCE, designated them as payee, and said check endorsed by them and applied to the Briscoe account.
The Court was not impressed with the testimony of Mr. Armstrong, the employee of SUN FINANCE and is of the opinion that SUN FINANCE obligated itself to perform an act for BRISCOE, i. e., acquire additional insurance and failed to do so without explanation.”
* * * * * *
“Due to the fact that SUN FINANCE had acquired insurance coverage initially through no effort on part of BRISCOE and required coverage as loss payee, and that insurance premiums were part of the monthly note, BRISCOE had every reason to believe that SUN FINANCE would perform what they said they would do, or at least, inform them that coverage could not be obtained.”

The court reasoned that this evidence established a legal relationship between plaintiff and defendant requiring plaintiff to act in good faith to secure insurance coverage. He reasoned that plaintiff had become an agent of defendant and violated its duty as an agent.

We are confronted with a clear-cut credibility call by the trial judge rejecting Armstrong’s testimony and accepting Mrs. Bris-coe’s. While I am reluctant to disturb such a finding I have concluded from the facts and circumstances in the record that this particular finding was clearly wrong.

First of all, in the above quoted reasons it appears that the trial judge was influenced by the fact that plaintiff had so easily gotten insurance for defendant when the financing of the vehicle was arranged. However, the original policy was not written with the understanding that plaintiff’s seventeen year old son would be the principal operator, and when this factor became known a substantial increase in premium was required. The insurance was readily available but Briscoe would have to pay for it. The amount included in the note for insurance was simply not enough.

Secondly, the trial judge specifically was impressed with the fact that the unearned premium was accepted by plaintiff and applied to defendant’s account, but this fact is not significant considering that R.S. 6:956(F) specifically authorizes the finance company to credit the return of premium to the installments on the retail installment contract where the policy is cancelled.

The trial judge felt that Briscoe had a reasonable basis for believing that plaintiff would obtain insurance coverage because it had initially procured such coverage and had included the insurance premium in Briscoe’s monthly note. However, I fail to see any connection between the procuring of the initial coverage and plaintiff’s alleged duty to procure the substitute coverage. In order to determine whether plaintiff had such a duty to defendant, the conduct of the parties after cancellation of the first policy must be considered. Obviously, plaintiff wanted defendant’s automobile to be insured for collision and comprehensive coverage so that its collateral for the note would be protected. The initial premium for the insurance policy was only $383 but Armstrong was notified that an additional $227 would be required in order to maintain coverage with defendant’s son as the principal operator of the automobile. It would make no sense for Armstrong to tell Mrs. Briscoe that he would go out and procure other insurance with the $187 which had been refunded when he knew this was impossible. His motive was not to get an additional credit on the note because his conversations took place with Mrs. Briscoe beginning in January, just after the policy was cancelled, and not until April did he credit the account with the refund. In order to accept Mrs. Briscoe’s testimony on the point I would have to believe that Armstrong made no protest, asked for no additional payment and acquiesced in the impossible task of acquiring the insurance for the little amount which had been refunded.

Finally, the trial judge indicates that Briscoe’s reliance on plaintiff to function as his insurance agent was partially based on the fact that he knew insurance premiums were part of the monthly note. However, Mrs. Briscoe testified (at page 85) that after her son had the second accident she read plaintiff’s documents for the first time and learned that the insurance was included in the note. She went on to say that she did not make any more payments because those payments were not repairing the automobile after the second wreck. Thus, her reliance could not be based on the inclusion of insurance payments in the note when she was unaware of the inclusion until after the second wreck.

I have concluded that the evidence does not support any theory of agency or estop-pel on which plaintiff’s liability to defendant for damages arising out of the second accident could rest and the judgment on the reconventional demand should be reversed.