author: HIGGINS, J.

text:
    No. 10,714
    Orleans
    LEINHARD v. MEYER ET AL.
    (June 10, 1929. Opinion and Decree.)

      Eloi L. Bordelon and Louis R. Hoover, of New Orleans, attorneys for plaintiff, appellee.
    J. Olin Chamberlain, of New Orleans, attorney for defendants, appellants.
   HIGGINS, J.

Plaintiff sues defendants, one as architect and contractor and the other as surety, in solido, for damages resulting from the defective construction of a duplex apartment under a written building contract. The building was constructed of hollow tile, stuccoed on the outside and plastered on the inside. The defendant, Meyer, was the contractor and also the architect who drew the plans and specifications for plaintiff.

Plaintiff claims in his petition the sum of $1,655 for damages caused by leaks in the walls and around the windows of the said building, due to faulty construction. Defendant, Meyer, denied liability and specially pleaded that the leaks were caused by the improper laying of the hollow tiles, as ordered by plaintiff’s superintendent or expert, and reconvened for the sum of $136 for extra work.

The defendant bonding company denied liability and called in warranty the said contractor, in accordance with the provisions of the bond and contract.

There was judgment in favor of plaintiff and against defendants,' in solido, for $1,-655; also judgment in favor of defendant, Meyer, against plaintiff on reconventional demand for $98.54, and also judgment in favor of defendant bonding company against Meyer, under its call in warranty, for the said sum of $1,655. Defendants appealed.

Plaintiff proved by a preponderance of evidence that the leaks in the walls and around the windows were caused by said contractor’s failure to place mortar and cement in the cross joints of the tile, and to the improper application of the stucco to the outside of the hollow tile, and also to the improper installation of the windows. The evidence sliows that the leaks complained of were of an unusual and serious nature, and that plaintiff called upon defendant, Meyer, on a number of occasions, to remedy the said defects, who, in response to the said notices, attempted to remedy them, but without success.

We do not find that the laying of the tiles vertically instead of horizontally, as suggested by the expert of the Security Building & Loan Association, which had made the loan to plaintiff for construction of building, and which was a party to the contract, caused the leaks around the windows and in the walls of the building. The suggested change of the tiles from a horizontal to a vertical position was for the purpose of giving the tile bearing strength, because the walls supported the edifice. The vertical position seems to be the recognized and best way of laying the tile. The leaks around the windows and in the walls were primarily caused by the contractor’s failure to apply a proper coat of stucco to the outer walls. The thin coat of stucco permitted the rain to seep through and, there being no cement or mortar in the cross joints • of the tile, the water came in contact with the plastering on the walls and around the windows and leaked down upon the floors, causing the damages complained of.

It was the intention of all the parties to the contract that the building should be tenantable and constructed in a workmanlike manner, and of good material such as to resist the usual rains in the locality. The building was not water-proof, as was contemplated by the contract.

Article 2037 of the Revised Civil Code, in discussing obligations, provides that:

"Every condition must be performed in the manner that it is probable the parties wished and intended that it should be.”

(Syllabus No. 1):

“The architect who prepared the plans and specifications of a building, and after-wards became the contractor,- and agreed with the owner to put up the building according to plans and specifications, is responsible for any defect or insufficiency in the specifications. He cannot escape responsibility for defectiveness of the work by taking the ground that the defect was in the specifications, and not in the work. He is responsible for both. The surety company which signs his bond to guarantee the safe execution of his contract, as an architect and contractor, is equally as responsible as the architect and builder for the defectiveness of the specifications, or the work, where the architect and builder are one and the same person.” La. Molasses Co., Ltd., vs. LaSassier et al., 52 La. Ann. 2070, 28 So. 217.

See, also, Levy vs. Schwartz, 34 La. Ann. 209; Lewis vs. Blanchard, 8 Mart. N. S. 290; Rev. Civil Code, articles 1930, 1931.

“Defendants had drawn the plans and specifications. They knew that plaintiff wished to have a tenantable house constructed. She trustingly paid them a large portion of the contract price a day or two after defendants had commenced to work in constructing the building. They owed it to her to use only good, merchantable materials, and to do the whole work in a workmanlike manner. In this there was failure. Instead of the material and the work for which the specifications called, the material, in some respects, must have been of an inferior- quality, for on no other theory can the unsatisfactory appearance of the building be accounted for.” Sarrazin vs. Alfred A. Adams & Co., 110 La. 124, 34 So. 301.

Defendants, having failed to discharge their obligations under the contract and bond to erect and deliver to plaintiff a sound, water-proof house, due to its faulty construction, are responsible for the damages plaintiff sustained.

The contention of defendants that, as plaintiff did not have the work actually done, but merely had bids made covering the correction of the defects in the building, there was insufficient proof of the damage, is untenable. The record shows that plaintiff obtained three bids and that the lowest bid was for the sum of $1,555 for the walls and windows and $100 for the flooring. The parties who submitted these bids testified as to the reasonableness of that amount to properly repair the building. Defendants failed to rebut this proof. The test is, what would it cost to repair the damage, and plaintiff proved this by a preponderance of the evidence.

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


source: Caselaw Access Project

author: ODOM, J.

license: Public Domain

text:
    No. 3389
    Second Circuit
    HARRIS v. H. C. TALTON WHOLESALE GROCERY CO., INC.
    (July 1, 1929. Opinion and Decree.)
    A. S. Drew, of Minden, attorney for plaintiff, aspellee.
    Coleman Lindsey, of Minden, attorney for defendant, appellant.
   ODOM, J.

Plaintiff is the holder and owner of a promissory note of the defendant corporation, executed and signed by its general manager Upon defendant’s refusal to pay the balance due on the note, plaintiff brought this suit.

The defense is three-fold. First, that S. H. McCrary, who signed the note for the corporation, was not authorized to do so by the board of directors, and that the note was made without the knowledge or consent of the stockholders; second, that the note is without consideration; and third, that if it should be held that the note was executed with defendant’s authority, then the transaction which resulted in the execution of the note was ultra vires the powers of the corporation. From an adverse judgment, defendant appealed.

OPINION

We dispose of the defenses in the order named:

(1) The defendant is a mercantile corporation organized under the laws of this State, its objects and purposes as stated in the charter being to buy and sell merchandise at wholesale and retail, to buy and sell cotton, cottonseed and fertilizers and to own or lease real estate when incident to its business, and to borrow money when necessary, and to pledge the property of the corporation as security when required; and “to do any and all things incident or necessary to the conduct of the business,” and, as elsewhere stated in the charter, “to do and perform any and all acts in furtherance of its interests when not prohibited by law.”

The corporation was organized by three persons: H. C. Taitón, Helen Gray and S. H. McCrary, who subscribed for all of the stock — Taitón taking 200 shares, Miss Gray one share and McCrary 49 shares. Miss Gray seems to have dropped out, and on the date this note was executed, August 5, 1927, there were four stockholders, to-wit: H. C. Taitón, who owned $13,500 of the stock; S. H. McCrary, who owned $8,500; I. G. Duke, who owned $500, and Mr. Woolf, who owned $1,000 of the stock. These were the only stockholders and were members of the board of directors, with Taitón as president; McCrary, general manager, and Duke, secretary and bookkeeper.

As a matter of custom, habit and practice, the board of directors, as such, took no stock or interest in the conducting of the affairs of the corporation. Only one meeting a year was held and that for the purpose only of electing officers. Taitón, as president, and McCrary, as general manager, the chief stockholders, were entrusted with the entire management of the concern. McCrary, as general manager, stayed in the office, did all the buying, conducted the business generally, employed the help with little if any advice or assistance from the others, signed notes evidencing the indebtedness of the corporation, and signed checks for and in its name. There is some evidence that McCrary at times consulted Taitón, and possibly Duke, with reference to the signing of some of the notes. Taitón and Woolf were outside salesmen and spent but little time in or about the place of business. Duke stayed in the office and kept the books, but neitner he nor the other stockholder, Woolf, took the slightest interest in the conduct of the business. They left everything to Taitón and McCrary. The board of directors was never called together to authorize or ratify any business transaction.

About the 1st of August, 1927, the plaintiff, Harris, who represented the New York Life Insurance Company as local agent, called on McCrary and suggested' that it would be good business for the corporation to procure insurance on the lives of both Taitón and McCrary, with the corporation as beneficiary. McCrary looked with favor upon the proposition and suggested to Harris that he see Taitón, which he did. Taitón also approved, but told Harris that the corporation had no money at that season of the year with which to pay premiums on policies. Harris then told Taitón that he would pay the premiums personally and carry the amount as an indebtedness against the corporation until January 1st, following. To this, both Taitón and McCrary assented. Whereupon Taitón and McCrary signed applications, each for a policy of $10,000, on their lives, with the defendant corporation as beneficiary. The applications were accepted, the policies issued and delivered to the corporation and deposited in its safe, where they remained until this case was tried.

To c'arry out the contract as agreed upon, Harris personally paid the premiums on the policies to the New York Life Insurance Company and gave to Taitón and McCrary receipts showing that the premiums on the policies were paid for one year. As evidence of the indebtedness of the corporation to Harris for the amount which he advanced to pay the premiums, the note sued on was made. The note was written out by Duke, the bookkeéper, stockholder and director, and McCrary, the general manager, signed it with the corporation’s stamp as follows: “H. C. Taitón Wholesale Grocery Co., Inc.,” underneath which he wrote: “By S. H. McCrary.”

Duke says he understood the transaction, knew what the note was for and, while he took no part, except to write the note as he was directed, he interposed no objection, then or later. Taitón was not present when the note was made out and signed, and now says that he knew nothing of its existence until it was presented for payment. But, he says that he recognized all along that the corporation was justly indebted for the amount of the premiums on the policies, and further, that he considered the transaction good business policy for the corporation. Duke, the bookkeeper, says that this note to Harris was carried on the books of the corporation as a liability under the head of “bills payable” and that the books were at all times open to Taitón for inspection, although he does not know whether Taitón examined the books and saw such entry. Duke further testified that at the regular meeting of the board of directors in January, before the note was presented for payment, nothing was said about it by anyone — it was never repudiated.

As already stated, Taitón does not deny, but in fact admits the debt, but he, as president, defends on the technical ground that McCrary had no authority from the board of directors to sign the note. It seems to us, however, that if the corporation had power to create the debt, McCrary, under the general practice, was authorized to execute the note evidencing the debt.

Harris presented the note to Taitón in January, at which time he denied any knowledge of its existence, but had the corporation pay Harris the amount of the premium on his own policy, but refused to pay the balance, being the amount of the premium on the policy on the life of McCrary, for the reason that McCrary was no longer connected with the corporation, having severed his connection with it some tim5" after the policies were written. However, he suggested to Harris that he go to McCrary and get him to pay the balance, and, when this suit was called for trial, the defendant corporation tendered to Harris $151.25, which tender was refused.

Now under these circumstances, can the corporation, represented in this suit by Taitón, the president, be heard to repudiate this note on the ground that Mc-Crary had no authority to make it? We do not think so.

True, the board of directors did not by formal action authorize the making of the note by McCrary, the general manager. But it had entrusted the entire management of the concern to McCrary who signed other notes and all checks for it without express aüthority, and none of his acts were ever repudiated or even questioned. By custom and practice, all similar matters, were left in his hands. Not only that, but the transaction was tacitly approved by Taitón, McCrary and Duke — three of the four stockholders and directors, each of whom knew all of the facts, and, while Taitón says that he did not know that the note was in existence, yet he admits that the corporation owed the debt.

It is not always necessary that the acts of an officer of a corporation, if not ultra vires, be formally authorized by its board of directors. An officer, such as the general manager, may lawfully bind a corporation where similar acts of his have been approved and sanctioned by the stockholders and members of the board as a general practice, custom and policy. The authority of its officers often and frequently depends upon the course of dealings which the corporation or its directors have sanctioned. The latest expression in point by our own courts which we have been able to find is the ease of Gueydan vs. T. P. Ranch Co., 156 La. 397, 100 So. 541, where the court said:

“It is a familiar principle in law that it is not always necessary to show the authority of an officer of a corporation by a resolution of its board of directors, A corporation may not, any more than an individual, reap the benefits flowing from the acts of its officers and repudiate the obligations arising from the same acts. Berlin v. Cusachs, Ltd., 114 La. 744, 38 So. 539; Gair v. Columbia Rice Company, 124 La. 194, 50 So. 8; Boudreaux v. Feibleman, 105 La. 404, 29 So. 881. A course of conduct pursued by a corporation for many years, in permitting an officer to do an authorized act, is an acquiescence in such act and creates an estoppel.”

In addition, we cite Haas vs. Gumbel & Co., 155 La. 414, 99 So. 350; Blanc vs. Germania Natl. Bank, 114 La. 739, 38 So. 537.

(2 and 3) The defenses that the note . was without consideration and that the acts of the corporation in taking the insurance on the lives of Taitón and Mc-Crary, and the giving .of the note were ultra vires must likewise fall.

The consideration of the note was money advanced by Harris to pay the premiums on the policies. The note was not given for the premiums, but for money which Harris advanced to pay them. The corporation agreed that Harris should pay the premiums and agreed to reimburse him for the amount, so that the transaction with reference to the note was in the nature of a loan or an advance by Harris to the corporation, and constituted a separate contract.

But if it be said that the note was given for the premiums, the protection afforded by the insurance was sufficient consideration for the note. This point is practically conceded by counsel for defendant in his brief, but he argues that the corporation had no insurable interest in McCrary after he severed his connection with it. That is true, hut, as already stated, the consideration of the note sued on is money advanced by Harris for the corporation which it agreed to pay.

On the question of ultra vires, we find that the charter provides that the corporation, in addition to its other powers, is given general power and authority "to do any and all things incident or necessary to the conduct of its business,” and, as stated in Article 8, may “do and perform any and all acts in furtherance of its interest when not prohibited by law.”

Taitón and McCrary were not only the chief stockholders of the corporation, but they were its chief officers and sole managers. Upon them depended the success of the business. Their ability to successfully conduct the affairs of the corporation was one of its assets, and probably, as is sometimes the case in corporations like this, its main asset. If either had died, it would necessarily have suffered serious loss. The corporation therefore, had an insurable interest in each of them, and under its powers could do any act “in furtherance of its interest when not prohibited by law.” The act of taking the insurance is not prohibited by law and we think was in furtherance of its interest, as much so as the taking of fire insurance on its real and personal property. The corporation had no by-laws and there is no specific authority in the charter for taking fire insurance on its property. But it would hardly be contended, we think, that the corporation could not under its implied powers bind itself for the premiums on a fire insurance policy. The taking of such insurance is incidental and necessary and in furtherance of its interest.

In the case of United States vs. Hardware Co., 68 Law Ed. 970, 265 U. S. 189, 195, 44 Sup. Ct. Rep. 546, 548, Chief Justice Taft, the organ of the court, had this to say:

“Life insurance in such a case as the one before us is valid, and is not a wagering contract. There was certainly an insurable interest on the part of the Company in the life of Biddle. * * * Life Insurance in such a case is like that of fire and marine insurance — a contract of indemnity. * * * The benefit to be gained by death has no periodicity. It is a substitution of money value for something permanently lost, either in a house, a ship or a life. * * *”

In the case of Mutual Life Insurance Co. of New York vs. Board, Armstrong & Co., 115 Va. 836, 80 S. E. 565 (L. R. A. 1915-F, 979), the Supreme Court of Virginia held, to quote the syllabus in L. R. A.:

“Insurance by a corporation for its own benefit of the life of its president and general manager, to protect itself from loss in case of his death, is not ultra vires nor contrary to public policy.
“A corporation has an insurable interest in the life of its president and general manager, whose death would result in a serious and substantial loss to its creditors and all others interested in its prosperity.”

The judgment appealed from is correct, and is accordingly affirmed with costs.


author: WEBB, J.

text:
    No. 3524
    Second Circuit
    SMITH, SR., ET AL. v. L. H. GILMER CO. OF LA., INC.
    (July 1, 1929. Opinion and Decree.)
    Mabry & Carstarphen, of Shreveport, attorneys for plaintiffs, appellants.
    Barnette & Roberts, of Shreveport, attorneys for defendants, appellees.
   WEBB, J.

Plaintiff, representing his minor son, brought this action to recover judgment against defendant for compensation for disability and disfigurement alleged to have resulted from injuries sustained by his son while employed by defendant', and plaintiff appeals from a judgment rejecting his demands.

It is established that plaintiff’s son, while in the course of his employment with defendant, received an accidental injury arising out of his employment, for which he was paid sixty-five per cent of his weekly wages of $15 for a period of thirty-two weeks. It is contended, however, that he had fully recovered from any disability resulting from the injuries at the time defendants ceased payments and that there was not any impairment of any physical function or facial disfigurement as the result of the injuries, and that no further compensation was due.

The evidence shows that plaintiff’s son, who was seventeen years of age, was employed by defendant to operate a machine at a factory conducted by defendant, and that in some way the employee’s clothing was caught in the machinery and that his head and body were drawn into the machine, with the result that his lower jaw was broken and his face lacerated and body bruised, and plaintiff contends that the injury had resulted in an impairment of his son’s health to such extent as to permanently totally disable him to do work of any reasonable character, and plaintiff prayed for judgment for compensation at the rate of sixty-five per cent of the weekly wage earned by his son, for the period of disability, not to exceed four hundred weeks, less compensation paid, and for general relief.

There was some evidence offered tending to show that the injury had resulted in permanent disability, in that the young man stated that he had suffered with dizziness, headache, and pain in his back since the accident to such an extent that he was unable to work, and other evidence was offered to corroborate his statement, as that he had not done any continuous work since recovering from the immediate disability resulting from the accident to the date of the trial, or about twelve months. However, the physicians who attended the young man after the accident as well as those who examined him prior to and at the date of the trial, did not find there was anything which would indicate that the dizziness, headache or pains in his back of which he complained resulted from the injury received at the time of the accident, and the only, suggestion that any such ailments could have resulted from the accident was by one of the physicians, who expressed an opinion that some injury to the heart may have been sustained in the accident, of which, howe'ver, it was conceded there were not any objective symptoms, and conceding that the young man suffers with dizziness, headaches or other pains, which disable him, the evidence does not establish that such ailments resulted from the injury sustained in the accident, and plaintiff’s demands for compensation for disability were properly» rejected.

As to the claim for compensation for serious permanent impairment of a physical function, and serious permanent disfigurement, the evidence shows that as the result of the accident it was necessary to remove a portion of the jaw bone and two teeth, and that after the lacerations of the face had healed, there were scars on the jaw and notches which, it was said by one of the physicians called by defendant, would be a serious disfigurement on the face of a woman.

In Odom vs. Atlantic Oil Producing Co., 162 La. 556, 110 So. 754, it was held that, under the provision of the statute reading “in cases not falling within any of the provisions already made, where the employee is seriously permanently disfigured about the face or head, or where the usefulness of a member or any physical function is seriously permanently impaired, the court may allow such compensation as is reasonable in proportion to the compensation hereinabove specifically provided in cases of specific disability above named, not to exceed sixty-five per centum of wages during one hundred weeks,” the loss of three front teeth was a serious permanent disfigurement, and constituted a serious impairment of a physical function, although the teeth had been replaced by a bridge.

While the loss of jaw teeth would not be such a serious disfigurement as the loss of front teeth, it would be equally as serious an impairment of - a physical function, and in the present instance it being shown that there was a loss of a part of the jaw bone and that there was a noticeable disfigurement of the face by reason of the scars resulting from the injury, we are of the opinion plaintiff should recover under paragraph 16, clause (d), subsection 1, section 8, of the present statute (Act No. 85 oi 1926) which is practically identical with the provision quoted in O'dom vs. Atlantic Oil Producing Co., supra.

The provision vests the court with discretion as to the amount of the weekly payments, but fixes the period of compensation at one hundred weeks, and we think that a reasonable compensation would be $5 per week for a period of one hundred weeks, less the amount previously (paid of $304 (par. 18, clause (d), subsection 1, section 8).

.The accident occurred on May 24, 1927, and from that time to the date of the decree herein, a period of one hundred weeks will have elapsed, and we think that judgment may properly be rendered for the amount of $500, less $304, with legal interest from date of the decree.

The judgment appealed from is therefore avoided and reversed, and it is now ordered that plaintiff, Joe Smith, have and recover judgment against defendant, L. H. Gilmer Company of Louisiana, Incorporated, for the use and benefit of his minor son, Joe Smith, in the sum of $500, less ‘ $304," with legal interest from date and all costs of suit.


author: WESTERFIELD, J.

text:
    No. 10,721
    Orleans
    MELUN v. N. O. PUBLIC SERVICE, INC.
    (July 1, 1929. Opinion and Decree.)
    Benj. T. Waldo and Fred C. Marx, of New Orleans, attorneys for plaintiff, appellant.
    Ivy G. Kittredge, of New Orleans, attorney for defendant, appellee.
   WESTERFIELD, J.

This is a suit for damages alleged to have been suffered by plaintiff by reason of a collision between the automobile which he was driving and a street car operated by the defendant street railway company. The accident occurred June 22, 1924, about 4:30 p. m., at a point on Lake avenue where the tracks of the defendant railway company cross. The street car tracks, at the scene of the accident, parallel a wide and much-traveled roadway known as Metairie road. Lake avenue is a small country road which leads from Metairie road to Lake Pontchartrain at approximately a right angle. Plaintiff, at the time of the accident, was driving his Ford sedan along Metairie road, and upon reaching Lake avenue, turned into that thoroughfare with the intention of driving toward Lake Pontchartrain. As he reached the tracks of the defendant, which are hut a few feet from Metairie road, he was struck by the street car, which had been traveling in the same direction as plaintiff, before he turned into -Lake avenue.

The negligence charged to the defendant consists in the allegation that there was no bell ringing as the. electric street car approached Lake avenue, and also because “said electric car was being driven at a reckless high rate of speed down an incline of approximately one and one-half feet in every one hundred feet and between an alley, or hedge, of weeds which the defendant had allowed to grow on, or near its tracks and upon its right of way and which obscured any view of said tracks.” Defendant denied the charges of negligence in the petition, and pleaded contributory negligence. The case was tried by a jury, and resulted in a verdict for defendant, upon which a judgment to that effect was rendered.

The plaintiff testified that, after turning into Lake avenue, and as he reached a point about eight feet from defendant’s tracks, he stopped his automobile, and, not seeing, or hearing, the approaching electric car, started up again, and was struck on the right running board by the street car, with the result that he sustained the injuries set out in his petition. He explains his failure to see the street car by saying that the track was bordered by weeds, which had grown to a height of five feet, and that these weeds obscured his view of the car, which was making less than the usual amount of noise, due to the fact that it was coasting down the incline, and therefore he did not hear it. There is considerable testimony concerning the presence of the weeds along the right of way of defendant’s car track, and we are of opinion that plaintiff has established the fact that there were weeds there, but we are unable to follow him in his contention that the weeds were high enough to have altogether prevented his seeing the street car, which he must have traveled abreast of for some distance before he reached Lake avenue. The street car was eleven feet high, and the weeds are claimed to have been only five feet. We cannot understand how plaintiff could have failed to see or hear the street ear if he stopped within eight feet of its track, as he claimed he did. It seems to us that, making all due allowance for coasting, the movement of the wheels on the rails must have made sufficient noise to have attracted his attention, particularly as he knew that street cars habitually used that track; in fact, he stopped for the purpose of ascertaining their presence in the vicinity.

Notwithstanding the weeds, he should have seen the top of the car, at least, if he looked in that direction, and, of course, he should have looked in both directions. But we find in the record the testimony of a Mrs. Austin and that of her husband, Henry Austin, who were passengers in the street car, and who, in addition to the motorman and conductor, assert that the motorman was ringing his bell continuously as lie approached Lake avenue. Mrs. Austin saw the plaintiff driving along Metairie road, and saw him turn into Lake avenue, and, as he did so, she exclaimed to her husband: “Look, that man is going to run into the street car.”

Our conclusion is that the unfortunate accident was due to the carelessness of plaintiff. We find no fault with the operation of the street car, and, whatever may be said of the effect of the weeds adjacent to the car tracks, even if it be considered negligence as in some degree obscuring the presence of street cars in that vicinity, and of this street car in particular, the negligence of plaintiff was the proximate cause of the accident, and contributed thereto, and he cannot recover.

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


text:
    No. 11,069
    Orleans
    SUCCESSION OF IRBY
    (June 24, 1929. Opinion and Decree.)
    Dart & Dart, of New Orleans, attorneys for plaintiff, appellee.
    Lemle, Moreno & Lemle, of New Orleans, attorneys for defendant, appellant.
   HIGGINS, J.

Mrs. Jeanne Castellanos, as legatee, filed proceedings against Canal Bank & Trust Company, as executor of the succession of William R. Irby, to obtain $1,000 special legacy provided in the codicil of the . deceased’s will, and also for the return of a note in the sum of $1,000 payable on demand, and bearing 5 per cent interest, which note, together with 10 shares of stock in La Boutique du Patio Royal, Inc., were found in the deceased’s bank box. Plaintiff claims $1,000 under the provisions of the codicil of the will and the .return of the note on the ground that it was not a valid, subsisting obligation. Defendant admits that there is $1,000 special legacy due plaintiff, in accordance with the provisions of the codicil to the will, but in reconvention claims the $1,000, plus 5 per cent interest, attorney’s fees, and recognition of its pledge of the stock to secure the note, contending that the note was a valid, outstanding obligation.

There was judgment in favor of plaintiff ordering the executor to pay the $1,000 legacy and to return the $1,000 note to plaintiff. Defendant appealed.

The question involved is one of fact; i. e., whether or not the $1,000 note of plaintiff was executed purely as a matter of form, with no intention on the part of the deceased to collect it, or whether it was a valid, subsisting obligation between the testator and plaintiff. The learned judge of the lower court after hearing three witnesses offered by plaintiff (none having been offered by defendant), decided the issue of fact in favor of plaintiff.

The evidence shows that deceased was a wealthy man, who was very kind, charitable, and liberal with his money. He was interested in the preservation of the old Paul Morphy house as a point of historical interest. The deceased had known plaintiff and Miss Charlotte Mitchell, a witness for plaintiff, socially, for a great many years. He first established plaintiff in business, organizing a corporation known as the Maison Paul Morphy, Inc., which the deceased had organized and plaintiff had successfully conducted. Desiring to help Miss Mitchell in a like manner, Mr. Irby decided to form another corporation, to be known as La Boutique du Patio Royal, Inc. The evidence shows that Mr. Irby directed everything in connection with the incorporation of this concern, including the allotment of stock and the manner of financing and handling the same, using plaintiff, Miss Mitchell, and Mr. Irby’s auditor, Mr. A. C. Dumestre, as incorporators, and placing ten shares of stock each in the name of plaintiff and Miss Mitchell, and five shares in the name of Mr. Dumestre. All these certificates were placed in the deceased’s bank box. Attached to the-certificates of stock of Miss Mitchell and plaintiff were irrevocable powers of attorney, and the notes of each of these parties, each for the sum of a thousand dollars. The Dumestre certificate of stock had an irrevocable power of attorney attached, but was unaccompanied by a note. The whole transaction was financed by Mr. Irby, who retained possession of all of the stock that was issued, as aforesaid, including his own stock. The evidence also shows that Mr. Irby did not intend to make any money out of the transaction, and went into it simply to assist the two ladies. Mr. Dumestre testified that Mr. Irby said that the manner of handling the allotment of the stock and the notes of the two ladies in connection therewith was a mere matter of formality. The notes were payable on demand, bearing 5 per cent interest, and the record shows that neither the interest nor any part of the principal of the notes were ever paid, although they were dated May 30, 1923. Plaintiff testified that there was never any intention on her part to invest funds in the stock of this corporation, and that she considered the note a mere formality, with no obligation on her part to pay it; that it was only her implicit confidence in deceased that made her sign the note.

Miss Mitchell testified that Mr. Irby told her, at the time of the signing and giving of the note to him, that ‘‘these papers will be put in my bank box, yours and Mrs. Castellanos’. If anything happens to me, the envelope will be handed to you without any reference to my estate, and if anything happens to you, it belongs to me.”

The court has reached the conclusion that the evidence shows that, while plaintiff execüted the note in the form of an obligation to pay $1,000 at no time was there any intention on the part of deceased or plaintiff that plaintiff should be obligated to pay the note. The evidence justifies the finding of the lower court.

The case clearly falls in the category of the jurisprudence to the effect that an appellate court should not disturb the judgment of a lower court on a question of fact unless it is clearly erroneous.

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


text:
    No. 10,727
    Orleans
    BLACHE v. REITH, JR.
    (June 10, 1929. Opinion and Decree.)
    (July 1, 1929. Rehearing Refused.)
    Habans and Coleman and Gus Levy, of New Orleans, attorneys for plaintiff, appellant.
    W. O. Hart, of New Orleans, attorney for defendant, appellee.
   HIGGINS, J.

This is a suit by a real estate agent on an alleged written contract to recover commission, interest and attorney’s fees, and also to have the contract of sale reformed so as to make the commission payable to J. Henry Blache in-, stead of P. J. Derbes, as provided in the alleged contract.

The record clearly shows that J. Henry Blache, real estate agent, and P. J. Derbes, also a real estate agent, agreed between them to purchase the property of Frank Reith, Jr., for $20,000, if Reith would sell the property for that price; and to resell the said real estate for the sum of $22,-500 to Joseph Rosenberg, a client of Derbes. The evidence shows that Blache went to the home of Reith and, after considerable discussion, persuaded Reith to sign an acceptance of a blank offer tc purchase the real estate for the sum of $20,000 and, on the same day had Derbes sign the offer to purchase the property. The alleged contract was signed on October 9, 1925, but the evidence shows that the deposit of $2,000 required by the contract was not made by Derbes until October 13, 1925, at which time the money was deposited in the account of Blache. Subsequently Blache returned $1,000 of this deposit to Derbes. The alleged contract provides that the commission is to be paid to P. J. Derbes instead of J. Henry Blache.

Plaintiff and appellant seeks the equitable remedy of having the alleged contract reformed so as to make the commission payable to J. Henry Blache, instead of P. J. Derbes, as set forth in the contract. In view of the fact that Blache was acting as the agent of Derbes and also as a party interested in purchasing the property with Derbes, and knowing that Derbes had an offer from Rosenberg to purchase the property at $22,500, and having failed to inform Reith of this fact, under the circumstances, this court will not invoke its equity power to reform the alleged contract, which we consider a nudum pactum. Rodgers vs. Bolinger, 149 La. 545, 89 So. 688.

This court, in the case of Derbes vs. Blache et al., 10 La. App. 424, 121 So. 366, in a decision rendered on April 1, 1929, required Blache to return to Derbes the balance of the deposit, amounting to $1,000, and fully goes into the history of the whole transaction and gives additional reasons which are decisive of the issues presented in this matter.

For the reasons assigned, the judgment of the district court is affirmed, appellant to pay all costs.


author: WE3TERPIELD, J.

text:
    No. 11,234
    Orleans
    LLOVERAS v. UNITED FRUIT CO.
    (June 24, 1929. Opinion and Decree.)

      Legier, McEnerny & Waguespack, of New Orleans, attorneys for plaintiff, appellant.
    Spencer, Gidiere, Phelps & Dunbar, of New Orleans, attorneys for defendant, appellee.
   WE3TERPIELD, J.

This is an appeal from a judgment maintaining an exception of no cause of action.

Plaintiff alleges that he shipped a quantity of potatoes from New Orleans to Havana, Cuba, via the defendant’s steamship “Cartago”; that the potatoes were in first-class condition when they left New Orleans, but that upon arrival in Cuba they were found to be damaged more than 50 per cent of their value; that the damage was occasioned by the negligence of defendant in putting the potatoes in such location in the hold of its ship as to subject them to great heat; that the steamship “Cartago” was equipped with ventilating fans and, though the shipment was made in the month of June, the fans were not in operation on the voyage; that as a result of defendant’s alleged negligence, plaintiff sustained a loss of $690 for which he asks a judgment.

Defendant’s exception is based upon paragraph 22 of the bill of lading covering the shipment of potatoes, ■ which was attached to plaintiff’s petition. The pertinent part of this paragraph reads as follows:

“22. If there is opportunity to discover by examination, before removal of the goods, that * * * damage to the goods exists or may exist the carrier or vessel shall not be liable for any such * * * damage, unless notice of. claim therefor be presented in writing to the carrier or to the master or agent of the vessel before removal of the goods * * * the carrier or vessel shall not, in any event, be liable for any claim or demand arising under this bill of lading or in respect of the goods, unless notice of the claim be presented in writing to the carrier within thirty days after delivery of the goods to the initial carrier hereunder * * * Nothing shall be deemed a waiver of the provisions of this article except a written express waiver signed by the carrier.”

There is no allegation in plaintiff’s petition to the effect that written notice of claim was made before the removal of the goods from defendant’s vessel or within thirty days after delivery of the potatoes in Havana. In a supplemental petition voluntarily filed subsequent to the filing of the exception of no cause of action the allegation is made that after the potatoes “were placed upon the wharf of the United Fruit Company in Havana, Cuba, they were examined by the consignee, Mr. Emilio Hevia y Fernandez, who discovered, upon such examination, that the potatoes were damaged at least 50 per cent, and that he immediately thereafter verbally notified the agent of the United Fruit Company at Havana, Cuba, of such fact, and gave- the defendant herein, the United Fruit Company, ample opportunity to examine these potatoes prior to their removal from the wharf.”

In counsel’s brief filed in this Court, it is admitted that no written notice of any kind was given defendant. The question, therefore, is whether plaintiff’s failure to comply with this stipulation in the bill of lading is fatal to his recovery. The contention is that the defendant has waived the requirement of written notice of claim by the acceptance of verbal notice and that in any event this provision in a bill of lading is unreasonable and, therefore, invalid.

Our attention is called to tlie fact that the bill of lading is sixteen inches long and ten inches wide and that printed on both sides in the smallest type are provisions qualifying, limiting and denying liability on the part of the carrier. Just what counsel would infer from this circumstance we are not advised. The print, though quite small, is legible. We would not recommend the perusal of the bill of lading as a literary diversion, but it seems to us that one who is in the habit of shipping large quantities of merchandise, potatoes for instance, should have a working knowledge of its contents at whatever cost in time and patience may be necessary. In any event it is the contract between the parties to this case a.nd upon which the claim of plaintiff must either stand or fall.

As to the alleged waiver of writen notice, we find an express stipulation in the bill of lading that this provision may not be waived except by “a written express waiver signed by the carrier.” There is no pretension that such waiver was signed bv the carrier.

The reasonableness of the notice required has been upheld in a great number of cases. In The Persiana, (C. C. A.) 185 Fed. 396, the court, in upholding the reasonableness of this stipulation, said:

“ ‘The parties were competent to make the contract and did make it, and it must be held good, unless it is contrary to public policy.’
“Since we cannot hold that the clause in this bill of lading is against public policy, we cannot strike it out of the contract merely because the present case is a hard one, nor can we substitute some other clause in its place on any theory that claimant may not have been prejudiced by failure to receive notice of claim while the goods were still under its control. Having failed to comply with this provision, libellants cannot recover.”

See also The Westminster, (C. C. A.) 127 Fed. 660, and The San Gulielmo, (C. C. A.) 249 Fed. 598.

In the case of Gooch vs. The Oregon Short Line R. R. Co., 258 U. S. 22, 42 S. Ct. 192, 66 L. Ed. 443, cited by plaintiff, it was held that the requirement of written notice of claim of personal injury within thirty days after the injury, by a person transported on a railroad pass, was reasonable. The dissenting, opinion, which counsel quotes at length is, of course, interesting as all emanations from such an eminent source always are, but it is not authoritative.

Our conclusion is that the judgment of the trial court is correct, and for the reasons herein assigned, it is affirmed.


author: JONES, J.

text:
    No. 10,944
    Orleans
    VACCARO BROS. & CO. v. L. & N. R. R. CO.
    (April 29, 1929. Opinion and Decree.)
    (May 27, 1929. Rehearing Refused.)

      See, also, Vaccaro Bros. & Co. vs. L. & N. R. Co., 11 La. App. 348, 123 So. 355.
    Denegre, Leovy & Chaffe, of New Orleans, attorneys for plaintiff, appellee.
    Harry McCall, of New Orleans, attorney for defendant, appellant.
   JONES, J.

This matter comes before us on a rule of defendant and appellant to show cause why the depositions of five witnesses taken in Nashville, Tenn., by plaintiff, should not be stricken from the record on the ground that they were intentionally never offered in evidence below. The attorney for plaintiff who has only come into the case since the appeal was taken, contends that it was not necessary to offer the Nashville depositions in evidence, because the agreement under which they were taken contains the following stipulation: “The depositions so taken shall be received and read in evidence without any formality and subject only to the rules of evidence as to materiality and admissibility of same.”

Although the transcript contains the depositions, they are not stamped by the clerk of court, and they hav.e no stamp mark indicating that the filing fee had been paid.

The following excerpts from decisions of the Supreme Court sustain the validity- of plaintiff’s procedure herein:

In re Louisiana Driving & Racing Club, 120 La. 268, 272, 45 So. 127, 128:

“If there be anything in the transcript which should not have been included in it, appropriate proceedings should be taken to have the same expunged.”

In Immanuel Presbyterian Church vs. Riedy, 104 La. 314, 29 So. 149:

“The fact that the district clerk, in making out a transcript, may have inserted therein matters not -proper to be there, or should, without authority, have pasted original documents to the record, should not cause the rejection of the appeal, but the ignoring and the disregarding of such documents or papers.”

In Gilmore vs. Lyon Lumber Co., 159 La. 18, 105 So. 85:

“An appeal will not De dismissed simply because a document, not offered in evidence, is included in tbe transcript. Where such proves to be the case, the court instead of dismissing the appeal, will ignore the document.”

See, also, Smith vs. Shippers’ Oil Co., 120 La. 640, 45 So. 533.

On the merits of the rule the transcript shows the following:

First. That, when the attorneys for defendant signed the agreement to take these depositions, they expressly reserved the right to object to any answer as being unresponsive to the question asked.
Second. Defendant objected to 4 out of 18 of the direct interrogatories proposed to these five Nashville witnesses, on the ground that the testimony sought to he elicited was irrelevant and res inter alios acta.
Third. Plaintiff also took, under an agreement containing the identical stipulation as that made the basis of the present contention, the testimony out of court of Ralph Stewart in this city, and the deposition of R. D. Grove, of Atlanta, Ga., and, in spite of the stipulation now relied on, plaintiff’s then attorney thought it necessary, and actually offered in evidence, both the testimony of Stewart and the depositions of Grove.
Fourth. Defendant’s attorney offered in evidence all his depositions, although they were taken under a similar agreement.

Code of Practice, art. 439, provides that a party intending to use depositions may take a rule to show cause why they should not be used as evidence and, on the trial of this rule defendant must urge all objections founded on any irregularity in the execution of the commission, and, if he fails to do so, all .such objections • shall be considered as waived. In our opinion, the formality waived in the above-quoted stipulation was the taking of the rule above provided for, but the stipulation did not include, and was not intended to include, the necessity of offering the depositions formally in evidence. If defendant in rule’s contention on this point were sound, it would have been perfectly useless for defendant’s attorney to make objections to the direct interrogatories, as they would never have an opportunity to urge the objections. Our conclusion on this point, that the depositions were intentionally omitted from the evidence, is confirmed by the contemporaneous construction of the agreement by counsel, who, in spite of an exactly similar stipulation, thought it necessary to offer in evidence all other depositions, which seems to be the general practice of attorneys at this bar. The fact that attorney for appellant brought up the transcript containing these depositions does not now prevent his complaining of its contents.

Act No. 229 of 1910, as amended by Act 265 of 1918, permits the appellant to file with the clerk of court a written list of the portions of the record to constitute the transcript, and give the appellee the right to give further instructions. The act concludes with the sentence that, “in the absence of such direction by appellant, the transcript shall be prepared as the law directs.” These acts imply that an appellant is responsible for the transcript only when he gives specific instructions with regard thereto. No such instructions were given in this case, and accordingly the inclusion in the transcript of improper matter should not be visited on the appellant. This view is supported by the decisions in the cases of Planters’ Lumber Co. vs. Sugar Cane By-Products Co., 154 La. 16, 22, 97 So. 267, and Becnel vs. Louisiana Cypress Lumber Co., 134 La. 467, 473, 474, 64 So. 380. In tbe latter case, tbe court said:

“We cannot refrain from stating that the whole responsibility under the law is with the clerk of court.”

Although the decisions quoted from the Supreme Court above seem to justify the removing the depositions from the record by order of court, or allowing them to remain there] and ignoring them, the former seems to be the better course.

For above reasons, the rule to expunge is now made absolute, and it is ordered that the depositions of X N. Golding, J. A. Macon, Charles Light, Jesse Walker, and A. L. Hicks be removed from the transcript herein.


author: JANVIER, J.

text:
    No. 10,944
    Orleans
    VACCARO BROTHERS & CO. v. L. & N. R. R. CO.
    (May 27, 1929. Opinion and Decree.)
    (June 24, 1929. Rehearing Refused.)

      See, also, Vaccaro Bros. & Co. vs. L. & N. R. Co., 11 La. App. 346, 123 So. 353.
    E. J. Thilborger and James J. Cullinane, of New Orleans, attorneys for plaintiff, appellee.
    Denegre, Leovy & Chaffe, of New Orleans, attorneys for defendant, appellant.
   JANVIER, J.

On July 22, 1920, plaintiff delivered to defendant at New Orleans three cars of bananas to be transported to Atlanta, Ga. The shipments were consigned to plaintiff itself. They left New Orleans at 9 a. m., on July 23, 1920. During that day, and admittedly long before the shipments reached Montgomery, Ala., instructions were issued by plaintiff to defendant to divert the shipments at Montgomery to Nashville, Tenn., and there to deliver them to J. N. Golding.

Through negligence of the employes of defendant, the diversion instructions were overlooked, and the shipments, instead of being diverted to Nashville, were transported to Atlanta, the destination originally shown in the bills of lading. They arrived in Atlanta on the- morning of July 25, 1920. There was no unusual delay in the journey to Atlanta. Stewart, the messenger employed by plaintiff to accompany these and other shipments, testified that the trip from New Orleans to Atlanta took about the usual time. Stewart also testified that when these shipments arrived in Atlanta they were in good merchantable condition.

Diversion instructions are given by the shipper to the railroad. The messenger, who accompanies the shipments, though he is employed by the shipper, knows nothing about these orders until he is told of them by railroad employes, at the diversion point. Therefore Stewart knew nothing of the diversion orders issued in this case, and the failure to divert was not caused by his negligence, nor was it knowingly acquiesced in by him.

The bananas, of which these shipments were composed, were not the usual green shipping bananas, which, though perishable, will nevertheless stand shipment for several days, but were what is known as “turnings,” which means, as the name suggests, bananas which are just beginning to turn ripe, and which can be shipped only a limited distance. In this connection Stewart said: “It is dangerous to ship these cars very much farther than Atlanta.”

When the fruit arrived in Atlanta, Stewart, plaintiff’s messenger, phoned R. D. Grove, plaintiff’s agent in Atlanta, and advised that he had four cars of fruit for him. .That Grove had been informed by plaintiff of the diversion orders is shown by the fact that he immediately said to Stewart: “No, you only ought to have one; * * * three cars diverted to Nashville.”

Stewart left the fruit in question at Atlanta and accompanied other shipments to more distant points. That Grove was plaintiff’s agent in Atlanta, and had authority to issue instructions in cases of this kind, is shown by the fact that on July 2, 1917, written authority had been issued by plaintiff, as follows:

“This is to inform you that Messrs. R. D. Grove & Co., of your city, are our authorized brokers for Atlanta and the adjacent territory, and we would thank you to kindly honor any instructions which they may give you relative to transferring, diverting, icing, etc., of shipments made by us.”

Grove sold the fruit in Atlanta for $414.66, but it was not removed by the purchasers from the cars until July 27th, more ¡than two days after its arrival there. Plaintiff had contracted to sell the fruit in Nashville for $1,303.50. It thus appears that plaintiff sustained a loss of $888.84.

Defendant denies liability for this loss and sets up several contentions in support of its denial of liability:

First. That there is no proof that the bananas', had they been properly diverted, would have arrived in Nashville in sound, merchantable condition.
Second. That there is no proof as to what would have *been the value of the bananas, even if they had arrived in Nashville in sound, merchantable condition, because the value should be determined by market conditions, and not by the particular contract of sale.
Third. That there is no proof that the price at which the bananas were sold in Atlanta was a fair price and represented the true market value.
Fourth. That, in taking possession of the bananas in Atlanta, Grove, acting as agent for plaintiff, ratified and acquiesced in the action of defendant in failing to divert the shipments.
Fifth. That, had Grove not taken possession of the shipments in Atlanta, they would have been sent on from there,, direct to Nashville, at which point they would have arrived on the morning of July 26th, which is the same time at which they would have arrived there, had the diversion orders been properly carried out.

We will discuss these contentions in inverse order.

In support of its fifth contention, defendant calls attention to that part of Stewart’s testimony in which he states that the trip from New Orleans to Atlanta took about the usual time, and that usually the trip from New Orleans to Nashville takes about 24 hours longer than the trip from New Orleans to Atlanta. Therefore, argues defendant’s counsel, it is evident that the fruit, after its arrival in Atlanta, could have been sent on to Nashville, where it would have arrived within 24 hours, had Grove not accepted delivery at Atlanta.

While it is true that Stewart did testify that as a general thing the trip from New Orleans to Nashville requires 24 hours longer than the trip to Atlanta, he also stated that the shipment from Montgomery to Nashville requires from 12 to 28 hours, depending on train connections. As the evidence shows that these cars reached Montgomery at 5:45 in the morning of the 24th, it seems highly probable that they could easily have been in Nashville in the early morning of the 25th, which was the time at which they actually reached Atlanta. The shipments laid over in Montgomery from 5:45 in the morning to 8:45 that night, or exactly 15 hours. This delay resulted from the fact that there would have been no reason to rush them on to Atlanta, as they would not have arrived there until some time during that late afternoon or night, and could not have been put on the market until the next morning anyway, but, had they been going on to Nashville, it is probable that they would have left Montgomery during the morning on which they arrived there, so they could have reached Nashville in time for the next morning’s market.

According to the testimony of Stewart, it would have required from 12 to 28 hours to go frcm Montgomery to Nashville, and, even accepting 28 hours as correct, it is evident that these shipments would have reached Nashville about 9 o’clock on the morning of the 25th, or one day sooner than they would have reached there, had they been forwarded from Atlanta.

As defendant admits its own negligence, but seeks to avoid liability therefor on the plea that the loss would have occurred anyway, and as the facts as to schedules of its own freight and special trains are matters peculiarly within its own knowledge, we think that the burden lay on it to prove affirmatively that the shipments would not have reached Nashville before the 26th, and that it was not justified, under the rules of evidence, in relying on conjectures, nor on probabilities.

Nor do we see any relief for defendant in its fourth contention. Grove testified, as did Stewart, that when the shipments reached Atlanta the bananas were in' good condition for “turnings,” but that they were yellow and could not be shipped further.

It was the duty of Grove, as agent for plaintiff, to minimize the loss. He was an expert, and in uis judgment it was best to try to dispose of the bananas in Atlanta rather than to take the chance of shipping them on to Nashville. It is true that they might possibly have been sent on without loss, but this seemed improbable. Where one, by his negligence, has created a situation which will probably result in loss to another, he cannot complain if that other, in good faith, does what seems reasonable and proper in an effort to minimize the loss.

Defendant’s third contention has given us considerable food for thought. It would seem, at first consideration, that plaintiff should have offered proof as to the reasonableness of the price at which the fruit was sold in Atlanta. Here again, however, we believe that plaintiff’s case is saved by a proper application of the rules of evidence as to the burden of proof. In the absence of a charge of fraud or bad faith, it maybe assumed that the price received for the fruit was reasonable, and that plaintiff obtained for it all that it was reasonably worth. Defendant could have overcome this by introducing evidence to -show that a better price could have been obtained. In the absence of such proof, we will assume the contrary to be true.

As to defendant’s contention that the fruit should have been immediately removed from the cars and sold, we believe that, in view of the fact that Grove knew that the bananas were fast ripening, it may be accepted as certain that he sold them as speedily as possible.

Defendant’s second contention is quite interesting, but, in our opinion, is satisfactorily answered by plaintiff. It is quite true that the market value, and not the contract price at which a • particular sale may have been made, is, as a general rule, determinative of the quantum of loss sustained in a situation of this kind. This is true because, where the article is one easily procurable and which can be bought on the open market, it is the duty of one who has made a contract to sell, and who by the negligence of another is prevented from delivering the goods he intended to deliver, to go into the open market and purchase other goods to be used in fulfilling his contract. But where the goods are not readily procurable on the open market, and where no proof of actual market value is available, the contract price at' which the goods’ were sold may, in our judgment, be assumed to be the actual value for the purpose of determining the amount of the loss. Particularly is this true where he who causes the loss offers no countervailing proof.

“In an action for the value of goods injured by delay in shipment, where the only evidence of value was the price at which they were sold, this, in the absence of evidence to the contrary, is sufficient to establish their market value. To show the amount of difference between the value of the goods in a sound condition and as injured, it may be shown what the goods brought when sold.” 10 C. J. p. 387, sec. 596.
“One sale furnished some evidence, and when there is no proof to the contrary it is not improper to assume that a sale proven without objection is one which occurred in the normal and usual course of business and at the prevailing market price.” Houston & T. C. R. Co. vs. Westbury (Tex. Civ. App.) 208 S. W. 383.

Defendant calls attention to the case of Gus Datillo Fruit Co. v. Louisville & Nashville R. Co., 226 Ky. 813, 11 S. W. (2d) 953. In this case there were two claims resulting from improper handling of bananas. In the second claim the defense was partially based on the fact that the measure of damage contended for was the difference between the value of the bananas at the time they were received by the defendant and their fair market value at the time they were delivered to the plaintiff at destination.

It is true that the court said:

“The true measure of damage is the difference between the fair and reasonable market value of the bananas at the time and place of delivery in their then condition and their fair and reasonable market value at the same time and place in the condition they would have been if they had not been damaged in transit.”

We are in accord with this view, but the difference between that case and this is that in this case we are justified, in the absence of proof to the contrary, in assuming that the sale price represents the true market value.

We believe we have already disposed of tbe first contention. Tbe bananas arrived in Atlanta on the morning of the 25th, in sound condition. Stewart’s testimony, as a whole, leads us to the belief they could have arrived in Nashville, instead of Atlanta, at the same time, had the instructions been carried out. It may be assumed that, had they arrived in Nashville on the morning of the 25th, they would have been found in the same merchantable condition in which they were found on arrival in Atlanta, at that time.

As we have already stated, it would have been very easy for the defendant to offer proof that the shipments would not have reached Nashville until the 26th, if that is a fact. Had there been such proof in the record, our conclusions might have been different. The record convinces us that plaintiff did everything it could to minimize the loss, and that, therefore, it should recover such loss as it has actually sustained.

Defendant’s legal contentions seem to us to be entirely sound, but its conclusions as to the facts are based rather on the absence of evidence than on proof of the truth of these facts, most of which facts, it itself could have proven, if true. The trial court felt that plaintiff was entitled to recover the amount of the loss, and in this we think it was correct.

As between the two parties, defendant, having made the error, should stand the loss. It is therefore ordered, adjudged, and decreed that the judgment appealed from be and it is affirmed, at the cost of appellant.


text:
    No. 11,238
    Orleans
    AMERICAN MULTIGRAPH SALES CO. v. GLOBE INDEMNITY CO.
    (June 24, 1929. Opinion and Decree.)

      L. R. Wertheimer, of New Orleans, attorney for plaintiff, appellee.
    Monroe & Lemann, and Walter J. Suthon, Jr., of New Orleans, attorneys for defendant, appellant.
   HIGGINS, J.

This is an action by the plaintiff against defendant as surety on a sequestration release bond. Plaintiff claims to have obtained a judgment for $607.50 against the defendant in a former suit, with recognition of its vendor’s lien and privilege on the property for which the sequestration release bond was given in the original suit. The petition alleges that a fi. fa. was directed against the defendant in the first suit and, having been returned nulla bona, that plaintiff had exhausted its remedies against the said defendant in the suit, and was entitled to hold the defendant, in the present suit upon the sequestration release bond, as surety.

Defendant admitted the execution of the bond, but denied liability on the following grounds:

First, that in the original suit judgment was rendered on November 8, 1926, and signed on November 15, 1926, in favor of the plaintiff and against defendant, without recognizing and maintaining plaintiff’s vendor’s lien and privilege upon the property sequestered, and therefore was a mere personal judgment in favor of plaintiff and against defendant that had the legal effect of rejecting plaintiff’s claim on the writ of sequestration and plaintiff’s assertion of the vendor’s lien and privilege, thereby releasing and discharging the surety from any liability on the bond.
Second, that on January 19, 1927, long after the said judgment had become final, anc after plaintiff, on November 25, 1926, had issued a -fi. fa. based thereon, plaintiff and defendant in the original suit sought to amend the judgment on joint motion of plaintiff and defendant therein, so as to incorporate therein a provision recognizing and maintaining the vendor’s lien and privilege upon the property seized, and for which the sequestration release bond had been given; that the order of court based on the joint motion to amend the original judgment is null and void for the reason that said judgment in the original suit was final, and accordingly not within the power or jurisdiction of the district court to amend the same.
Third, that the defendant in the. original suit, having been placed in the receivership proceedings, that the receiver had no power or right to waive any legal right or defense of said receivership and, even if effective between the parties consenting thereto, could not bind or create a liability upon the defendant as surety upon the sequestration release bond.

There are other alternative defenses which we do not consider necessary to recite, in view of the conclusions that we have reached. There was judgment in favor of plaintiff in this ouit for $650 and defendant herein appealed.

The facts leading up to the question which this court must decide on the present appeal are somewhat complicated, and involve three different suits in the Civil District Court.

On July 10, 1924, the American Multigraph Sales Company sued the PeachBlo Products, Inc., on a written contract to recover the balance of the purchase price of $607.50 for certain equipment. The original petition did not ask for the recognition of the vendor’s lien and privilege on the equipment, hut, by supplemental petition, plaintiff in said suit asserted its vendors’ lien and privilege upon the property sold, and prayed for and obtained a writ of sequestration. On April 30, 1925, the defendant in said suit obtained an order authorizing the release of the property sequestered upon furnishing a bond in the sum of a thousand dollars, which bond was signed by the Globe Indemnity Company, as surety, the present defendant herein. This bond was executed and filed on May 1, 1925.

While this suit was pending and untried a receiver was appointed in the Civil District Court for the Peach-Bio Products, Inc., on April 7, 1926. The property released by the sequestration bond was inventoried as an asset by the receiver, and sold separately in the receivership proceedings for the sum of $100. In the final account of the receiver, the state and city taxes, which primed the vendor’s lien of the American Multigraph Sales Company, were paid out of this fund of a hundred dollars, completely consuming same. In the meantime, on November 8, 1926, an ordinary judgment was obtained by plaintiff against defendant, in the original suit, without recognizing or maintaining the vendor’s privilege asserted by plaintiff. It appears that the district court judge intended to place a decree in the judgment recognizing the vendor’s lien and ' privilege, and maintaining the writ of sequestration, because the- clerk was instructed to draw up judgment as prayed for. However, the clerk erroneously followed the original petition in the original suit, which did not pray for recognition of the vendor’s lien and privilege and for a writ of sequestration. This judgment was signed on November 15, 1926, and the delays for a new trial and suspensive appeal elapsed without any party to the suit asking for a new trial or a suspensive appeal. Plaintiff in the original suit caused a fi. fa. to be issued on November 26, 1926, which was returned nulla bona on December 19, 1926. Plaintiff then filed a rule for a judgment against the Globe Indemnity Company, as surety on the sequestration release bond, on December 9, 1926. This rule was dismissed on January 7, 1927, upon exception of defendant in rule on the ground that plaintiff should have proceeded by direct action and not by rule.

Thereafter, the plaintiff evidently discovered the omission from the judgment of the decree maintaining the sequestration, or recognizing the asserted vendor’s privilege. On January 19, 1927, two months after the signing of the ordinary judgment, plaintiff obtained the signature of the attorney for the receiver of the defendant in the original suit, to a joint motion to the" effect that the recital of the maintenance of the vendor’s privilege was erroneously omitted from' this judgment. Upon the basis of this motion, the district judge signed an order on the same day to the effect that the judgment be amended so as to include the words “with recognition of plaintiff’s vendor’s lien and privilige upon the property seized.” The surety on the sequestration release bond never consented to or authorized this amendment.

On January 25, 1927, the present suit was instituted by plaintiff against defendant as surety on the sequestration release bond, upon the basis of the judgment rendered in the original proceeding on November 15, 1926, and amended judgment of January 19, 1927. The case was tried on its merits on October 17, 1927, and resulted in a judgment for plaintiff against defendant for the sum of $650, which judgment was signed on October 25, 1927, and from which defendant prosecutes this appeal.

On November 10, 1927, the American Multigraph Sales Company, as plaintiff in the original suit, filed a petition for a devolutive appeal from the ordinary judgment rendered on November 8, 1926, and signed November 15, 1926. The evident purpose of the appeal is to have this Court supply the omission from the judgment of a decree maintaining the writ of sequestration and recognizing the asserted vendor’s lien.

We will first take up the question as to whether or not the judgment in the original suit, in its original form, could form the basis of a claim against the surety on the sequestration release bond. This judgment was a mere personal or ordinary judgment in favor of plaintiff against the defendant, with no mention of sequestration or the vendor’s privilege. A judgment in this form, in an action accompanied by a sequestration, has the legal effect of dissolving the sequestration and discharging a surety on the sequestration release bond from all liability under that bond.

In the case of Nalle vs. Baird, 30 La. Ann. 1148, the holding of the Court is summarized in the syllabus, as follows:

“No recovery can be had against the surety on a release bond, given for the release of the sequestered property on which the plaintiff claims a lien, where the judgment is a merely personal one against the principal on the bond, containing no recognition of the plaintiff’s lien or privilege on the property released, nor decreeing a restoration of the property to the plaintiff.”

The law requires that the judgment in favor of plaintiff in the sequestration suit must contain a specific decree maintaining the sequestration, or recognizing the asserted privilege, in order to impose liability on the surety on the sequestration release bond. Article 280, Code of Practice, reads:

“The security thus given by the defendant, when the property sequestered consists in movables, shall be responsible that he shall not send away the same out of the jurisdiction of the court; that he shall not make an improper use of them; and that he will faithfully present them, after definitive judgment, in case he should be decreed to restore the same to the plaintiff.”

Article 724, Code of Practice, reads:

“Provisional seizures and sequestration give no privilege to those who have made them, until they have obtained a judgment and order of execution on the property sequestered or. provisionally seized.”

Illustrations of the form of judgment necessary to impose liability on a surety upon a sequestration release bond show that the failure to recognize the vendor’s lien and privilege, or maintain the writ of sequestration of plaintiff in the original suit, was fatal to its right to hold defendant herein on the sequestration bond.

Perret vs. Coleman, 115 La. 814, 40 So. 176.

Pick & Co. vs. Dickinsons, Inc., 154 La. 1068, 98 So. 669.

It is a well recognized principle of law, in attachment and sequestration cases, that a judgment is presumed to cover every phase of the case and, accordingly, where a judgment is silent upon a particular item of relief demanded by the plaintiff, that silence has the legal effect of rejecting that portion of plaintiff’s demand. The following quotations from authorities amply show that the above-principle of law is well founded in our jurisprudence:

“Besides, the mere passing over this demand in silence was a rejection of it.”

Soniat v. Whitmer et al., 141 La. 235, (p. 240), 74 So. 916, 918.

“His judgment is silent on the amounts claimed in reconvention by the defenda-1. His silence must be construed in law as rejecting the same.”

Rauxet vs. Rauxet, 38 La. Ann. 669 (p. 671).

“Our jurisprudence has rested on a solid foundation, the rule that all the issues presented by the pleadings, and on which evidence has been offered, will be considered as disposed of by a final judgment in the cause, and that demands passed over in silence must be considered as rejected in the absence of a special reservation.”

Villars vs. Faivre, 36 La. Ann. 398 (p. 400).

“But where the plaintiff in a suit demands the recognition of his (privilege and right of pledge, and allows judgment to be rendered for the debt only without mention of the accessory rights demanded, the judgment is conclusive against these rights.”

Nalle vs. Baird, 30 La. Ann. 1148 (p. 1150).

“Privileges are ‘stricti juris’ and must be clearly established by those who assert them. Pretermitting the expression of an opinion as to whether or not Nicolson & Co. novated their claim for paving by taking the promissory note of Stinson, and thus lost their privilege, it would seem that the judgment which they obtained against Stinson on that note should be conclusive against their claim now asserted to be a privilege. That judgment, we have seen, did not allow the privilege, although claimed in that suit.”

Nicholson vs. Citizens’ Bank, 27 La. Ann. 369 (p. 370).

“But when the plaintiff prays for recognition of a privilege and the judgment is silent in regard to it, it amounts to a denial of it.”

Cazzo vs. Ulrich, 13 Orleans App. 257 (p. 259).

The court is therefore of the opinion that no liability on the part of the Globe Indemnity Company, defendant, as surety upon the sequestration release bond, resulted from the original judgment in the original suit rendered on November 8, L926, and signed November 15, 1926, and that the legal effect of that judgment was the rejection of plaintiff’s demand on the sequestration phase of the case, and the consequent discharge of the surely from any liability on the sequestration release bond.

We next pass to the question of the right or the authority of the district judge ,.to amend the judgment, after the delay for a new trial and suspensive appeal had elapsed, so as to recognize the vendor’s privilege and maintain the writ of sequestration.

A judgment is “the property of him in whose favor it is given.” C. P. 548. The judgment in question was in favor of the surety on the sequestration release bond in that the absence of a decree maintaining the sequestration worked the release of the surety from liability on the bond. Article 556 of the Code of Practice ■provides:

“Definitive judgments maj; be revised, set aside or reversed:
“1. By a new trial.
“2'. By appeal.
“3. By action of nullity.
“4. By rescission.
“This last mode can only be exercised by minors or persons who were absent when judgment was rendered against them.”

The following authorities clearly show that the district judge was without power, authority, or jurisdiction, to amend the judgment in the manner herein sought to be done.

“If a mistake occurred, or any error exists, in the original decree, the remedy therefor, or correction theréof, must be sought in this court by the aggrieved party, ' by way of an appeal, or by an answer to the appeal.”

Spence vs. Spence, 160 La. 430 (p. 433), 107 So. 294, 295.

“The judgment appealed from, under the guise of a professed interpretation, is really an amendment and alteration of the original judgment, in clear violation of the laws on that subject. C. P. 547, 548, 556.”

Factors & Traders’ Ins Co. vs. New Harbor Protection Co., 39 La. Ann. 583 (p. 585), 2 So. 407, 409.

“The defendants are appellants from a judgment which they contend was irregularly rendered, after a former judgment had been signed three days after the verdict had been given, and no motion made for a. new trial. The district court expressing its opinion, that it could correct its own judgment during the term, even ‘ex officio,’ and accordingly rendered a second judgment in greater conformity to the verdict than the first.
“We are of opinion the judge erred. The Code of Practice, 547, allows the court to make certain amendments, which it enumerates, until the judgment has been signed. This is certainly an affirmative, pregnant with the negative, that no amendment can take place after the judgment has been signed, nor before, except in one of the enumerated cases; but we have a positive provision on this subject. A judgment, when duly rendered (in the French text signé) becomes the property of him in whose favor it has been given, and the judge cannot alter the same, except in the mode provided for by law. Id. 548.”

Flint, Syndic vs. Cuny et al., 6 La. 67 (p. 68).

See also Act 10 of 1926; White vs. Louis, 149 La. 677, 90 So. 20; Larose vs. Naquin, 145 La. 1025, 83 So. 230.

Counsel for the plaintiff has cited the case of State vs. F. B. Williams Cypress Co., 132 La. 949, 61 So. 988, Ann. Cas. 1914D, 1290, as an authority that the amendment was permissible.

We have carefully examined that case and find that it is clearly distinguishable from the present case, because the Supreme Court held that it had the power to amend a mathematical error patent on the face of its own judgment, where the judgment had not been sent to the district court for recognition and execution.

In discussing the the articles of the Code of Practice with reference to limitation of the authority of courts to amend their judgments, the Supreme Court, in the Williams case, pointed out that the prohibitions were not against the Supreme Court, but against the district court, and in State vs. F. B. Williams Cypress Co., 132 La. 964, 61 So. 993, said:

“It will further be remembered that Article 547 of the Code of Practice contains very specific prohibitions against any meddling by the district courts with their judgments which have become final, but that ’aw directs no such prohibition against' this court, and the reason may perhaps be found in the fact that errors in the judgments of district courts may be corrected by appeal by action of nullity or by means of writs of certiorari, which this court is authorized to issue.

We now take up the third defense, i.e., the lack of authority of the attorney for the receiver of defendant in original suit to consent to the amendment of the judgment, and tnat, even if properly authorized, should not bind the surety on the sequestration release bond as a third person, but only the receiver. We find it unnecessary to discuss the authority of the attorney for the receiver to give such consent, because, even if properly authorized, we have reached the conclusion that such action on his part could not bind the surety on the sequestration release bond, a third party.

In Carroll vs. Hamilton, 30 La. Ann. 520, the court said:

“The fifth assignment is to the refusal to permit the defendants to prove that the judgment was merely by consent, and therefore not binding on them. This was error. It is well settled that consent judgments are only binding as such between the parties, and have not the effect of judgments regularly rendered contradictorily, as regards third persons. See Taylor vs. Sweet, 3 La. Ann. 34; Reynold’s Curator vs. Mahle, 12 La. Ann. 426; Robeson vs. Robert, 6 La. Ann. 2; Fletcher vs. Cavalier, 4 La. Ann. 276; Clarke vs. Scott, 2 La. Ann. 907; Allison vs. Thomas and Rosenfield, 29 La. Ann. 732.”

In Baker vs. Frellsen, 32 La. Ann. 822, an injunction case, the court said:

“The surety on an injunction bond has incurred obligations, but has certain rights which cannot be taken away from him without his consent. He is entitled to see the case tried according to law; a judgment rendered on the confession of the principal of his bond would bind the principal, but would not affect the surety. The case in which the bond is furnished should be called and disposed of in open court, under the forms and with the delays prescribed by law. His obligations must be strictly but legally construed. They consist in satisfying any judgment which the principal may be condemned to pay. It cannot be supposed that it ever entered the mind of the lawgiver and of sureties in such cases that a judgment rendered on the confession of the principal, or without his having been regularly dealt with, could saddle a responsibility on the surety on such bond. We think that the omission to hare proceeded regularly in obtaining the judgment rendered and to have ventured its validity on the agreement mentioned, entitles the surety, made appellee, to ward it off, and that he cannot be held responsible and liable on a judgment thus obtained.”

On rehearing, the court reached the same conclusion on this phase of the case, saying (p. 831 of 32 La. Ann.):

“We held that the judgment against Baker was not binding on Ludeling, because he was not a party to the agreement whereby the case was to be decided in chambers, out of term-time, and because, for the reasons stated in our former opinion, he could not be liable. This appeal is from the judgment dissolving the injunction. If Ludeling was not bound by the agreement and by the judgment, which was irregular and nugatory as to him, and that very judgment could alone fix his liability herein, how can we assess damages against him, unless we arbitrarily supply what we deem to be a fatal defect? The consent of the parties to the trial of the matter in which Ludeling was sought to be macie liable, in the manner in which it was tried, without his assent, and the appellant having selected and adopted such course, we think operates as a discharge of the liability of the surety on the injunction bond, and that issue is distinctly presented in this appeal.”

A case which strikes us as being in point is Herrick vs. Conant, 4 La. Ann. 276, in which the court held that no claim against the surety on a sequestration release bond could arise from • a confession of judgment in a sequestration suit made by the defendant in that suit, after his cessio bonorum. In the instant case, defendant in the original suit, which consented to the amendment of the judgment, was insolvent and in the hands of a receiver, presenting the same situation as obtained in the above cited case. The holding in that case is well stated in "the syllabus:

“A judgment confessed by an insolvent after a cessio bonorum made and accepted cannot affect the property ceded, which, from the time of the cession, was vested in the creditors; nor will such a judgment in favor of the vendor of moveables, who had sequestered them before the cession confessed, after the cession, by the insolvent, who had released the property on a bond before his cession, be binding on the surety in the sequestered bond.”

And in the body of the opinion, the court said (Siess vs. Couvillion, 4 La. Ann. 277:

“A judgment rendered under these circumstances, we consider as not binding on the surety. Pothier on Obligations, 816, par. 61. Clarke v. Scott, 2 La. Ann. 907.”

Prom the foregoing, it would seem that the consent of the defendant in the original case, while insolvent and in the hands of a receiver, could not have the effect of binding the surety, on the sequestration release bond, if the surety did not consent to the amendment of the judgment.

In view of the conclusions above reached we deem it unnecessary to pass upon the alternative defenses.

Por the reasons herein assigned, the judgment appealed from is annulled, avoided and reversed, and it is now ordered, adjudged and decreed that there be judgment herein in favor of the defendant, Globe Indemnity Company, and against plaintiff, the American Multigraph Sales Company, dismissing plaintiff’s suit, all costs to be paid by plaintiff and appellee.