author: Mabr, J.,

text:
    No. 5432.
    J. Davidson Hill & Co. vs. Mrs. Adelaide Bourcier and B. M. Pond.
    The appellate jurisdiction of this court is not divested by the fact that, pending an appeal in any particular'case, the appellant has become a bankrupt. In passing on the question of their appellate jurisdiction, this court will consider no fact which does not appear in the transcript of appeal.
    Pending a suit against a principal, and his surety, the surety can not ask that proceedings against him shall be arrested until the property of the principal has been discussed. In such case he can only ask, after having complied with certain requirements exacted by law, that the property of the principal shall be discussed under execution, before recourse on Ms property is had.
    The granting of a new lease, after a former lease has expired, will not work a novation, when nothing appears in evidence showing that the parties intended to novate.
    The money received by a lessor for rent due on account of a new lease, will not be imputed to the payment of any balance due by the lessee on a former lease, of the same property, unless so stipulated by the lessee.
    The mere neglect of a privilege creditor to sue will not release the surety of the debtor, even to the extent of the value of the privilege held by the creditor, unless it be proved that in consequence of such neglect, the privilege was lost.
    Where a judgment creditor is clothed by law with a certain privilege, or pledge, the mere absence of any express recognition of the privilege, or pledge, in the judgment of the court, does.not impair the lien.
    A PPEAL from the Sixth District Court, parish of Orleans. Saucie?', J.

      Ogden & Hill, for plaintiffs and appellees.

      Clarke, Bayne & Benshaw, for defendant.' .
   The opinion of -the court was delivered by

Mabr, J.,

Appellees, leased a dwelling to Mrs. Bourcier for one year, ending the thirtieth of September, 1873; and B. M. Pond became her surety for the performance of the stipulations of the contract.

At the expiration of this term a new lease was granted to Mrs. Bourcier, at a reduced rent, without security, for the year ending the thirtieth of September, 1874; and she continued in the occupation of the premises.

The rent for the last six months under the first lease was not paid ; and, in January, 1874, suit was brought against Mrs. Bourcier and Pond to recover the amount. She allowed judgment by default to be taken and confirmed against her. Pond answered that he was no longer liable as surety, because the lessors had novated the contract with Mrs. Bourcier, and had accepted her as their tenant for a prolonged period ; and had received from her rent sufficient to discharge the debt for which he was surety; and had released securities and privileges held by them under the contract of lease sued on ; and that they were bound to discuss the effects of Mrs. Bourcier before proceeding against him.

From the judgment of the district court against him Pond took this appeal; and it was returnable and was returned in this court on the first Monday of November, 1874.

When the cause came up for hearing counsel for appellant stated that his client had commenced proceedings in bankrdptcy in March, 1876; and he filed a paper in which that fact is set forth, with a certificate of the Clerk of the United States District Court that the proceedings in bankruptcy were still pending in that - court on the ninth of November, 1877. It was suggested in this, paper that this court no longer has jurisdiction, and that the cause must be remitted to the United States District Court.

In Serra é Hijo vs. Hoffman & Co., 29 An. 17, we decided that the jurisdiction of this court was not divested by the bankruptcy of the appellant pending the appeal; and we are satisfied of the correctness of that decision. Having appellate jurisdiction only, this court is required, by the appeal, to determine whether, upon the case made in the court of first instance, as shown by the transcript of the record and proceedings, the judgment appealed from is correct. To determine this question we must look to the transcript alone, for the obvious reason, in addition to the positive terms of the law, C. P. 894, etc., that nothing which may have occurred since the judgment was rendered can make it either correct or erroneous. The satisfaction or discharge of a judgment pending the appeal, must be set up in a court of original jurisdiction, against the enforcement of that judgment, after the appeal has been determined ; and not in the appellate tribunal.

In order to guard against misapprehension, we take occasion now to add that, when a judgment is affirmed on appeal, the decree of affirmanee gives- it no new force or effect. If a discharge in bankruptcy could have been set up against the enforcement of the judgment, in the event that no appeal had been taken, the affirmance of that judgment by this court could not prevent or interfere with that legal consequence and effect; and in no event could the action of this court, on the appeal, deprive the appellant of- any right, or remedy, or relief, under the bankrupt law, against that judgment, to which he may have become entitled after it was rendered.

•The surety has the right, under certain circumstances, to demand the discussion of the property of the principal debtor. Where suit is brought against the surety alone, he may interpose the plea, and compel the creditor to discuss the principal debtor. The effect of this is to stay proceedings against the surety untiL judgment has been obtained against the principal debtor, and execution against his property has proved insufficient. When the suit is brought against the surety and the principal debtor the plea of discussion does not require or authorize any suspension of the proceedings ; but the judgment will be so modified as to require the creditor to proceed by execution against the property of the principal; and to exhaust it before resorting to the property of the surety. Bernard vs. Custis, 4 Martin, 215; Banks vs. Brander, 13 La. 276.

In either ease, the surety who desires to avail himself of this right must demand it in limine, “ on the institution of proceedings against him.” He must, moreover, point out to the creditor property of the principal debtor, not incumbered, subject to seizure ; find must furnish a sufficient sum to have the discussion carried into effect. R. C. C. 3045, 3046, 3047. A plea which does not meet these requirements must be disregarded. - Robechot vs. Folse, 11 La. 136; Banks vs. Brander, 13 La. 276.

“Novation is a contract, consisting of two stipulations: one to extinguish an existing obligation; the other to substitute a new one in its ’place.”. R. C. C. 2185. We find in the record no evidence of any such contract. The granting of a new lease, at the expiration of the first term, did not extinguish, nor did it in any manner impair, the rights and obligations of the parties under the first lease: nor does it tend to show the substitution of a new contract or obligation in place of the first contract. These propositions do not admit of discussion ; nor do they require the citation of authorities.

We have searched the record in vain for evidence tending to show that any payment was made on account of the rent sued for. Mr. Hill, the only witness who says any thing on this subject, testified on the ninth of March, 1874, that he had collected of Mrs. Bourcier the rent under the new lease, for four or five months, at $125 a month; and that the whole amount sued for, $900, was still due and owing at that time. We know of no law which compelled him to impute the money thus collected on account of the new lease to the debt due under the first lease. Mrs. Boureier, owing both debts, might have required any money paid by her to her creditor to be imputed to the one or the other at her option ; but the fact, as proven by Hill,' that the collections were on account of the new lease, shows that she required the imputation to be made to the new debt, or that it was made to that debt by the creditor with her con-sent and approbation.

Hill testified that Mrs. Boureier was still in the occupation of the leased promises ; and that he had no knowledge of any change in her furniture.

Counsel for appellant argues that the failure of the lessors to enforce their privilege on the furniture, and to pray for judgment with privilege in this case, prejudiced his right of subrogation, and discharged him. He relies upon article 3061, R. C. C., which is as follows :

“ The surety is discharged when by the act of the creditor the subrogation to his rights, mortgages, and privileges can no longer be operated in favor of the surety.”

Jurisprudence has settled the law that the surety is not discharged by the mere omission of the creditor to sue the principal, or to enforce his privilege. If by the act of the creditor, or his willful neglect or want of proper diligence, any of the securities, rights, mortgages, and privileges by which the debt was secured, are lost, so that they can no longer be made available, the surety is discharged to the extent of their value. See Parker vs. Alexander, 2 An. 188; Saulet vs. Trepagnier, 2 An. 427; Bank vs. Escoffie, 2 An. 830; Bank vs. Ledoux, 3 An. 674; Shields vs. Barrow, 13 An. 57; Succession of Pratt, 16 An. 357; Elmore vs. Robinson, 18 An. 651; De Nouvion vs. Hodgson, 23 An. 438.

The Code has not left the surety at the mercy of the creditor; on the contrary, it affords him ample means of protecting himself. In the present case, at the time the suit was brought,' Mrs. Boureier occupied the leased premises; and it is to be presumed, the contrary not appearing, that she continued to occupy up to the expiration of the term under which she held, the thirtieth of September, 1874. All the furniture in the house was subject to the lessor’s right of pledge. There is no proof of the value of this furniture; but it is not shown that any of it had been removed. The suit was against principal and surety; and when Pond was cited he might have paid the debt immediately, and thus have become dominus litis. He would have been subrogated, by mere operation of law, to all the rights, actions, and privileges of the lessors against the lessee; R. C. C., article 3052; and he might have exercised and enforced them for his own account and benefit. In Robinson vs. Staples, 5 An. 712, it was expressly decided that the 'lessor need not seize prdvisionally in order to preserve his privilege. Nevertheless, i£ Pond had paid the debt, before judgment, he might have amended the pleadings, and have seized the furniture provisionally, if he had deemed this necessary for the enforcement of the privilege. The fact that it was not necessary is demonstrated in this case, because the furniture was not removed, nor is there any proof of any thing having been done with respect to it which placed it beyond the reach of the lessors’ privilege.

It is urged that as the lessors obtained a judgment for the rent due, without any recognition of their privilege, they had lost .that privilege; that they could no longer have enforced it themselves ; and that Pond could not have acquired, by subrogation, the rights and privileges which had thus been lost.

This view seems to be founded on a misapprehension of the law. There is a plain distinction between those cases in which the seizure of the property alone gives the privilege, as in attachment, and those in which the debt itself creates the privilege. In the first class of cases it has been held that the attaching creditor has no privilege if he does not pray for it, and have it awarded to him on the final judgment. Succession of Caldwell, 8 An. 42. And yet, in Love vs. Voorhies, 13 An. 549, it was decided that where the property attached was released on bond, and judgment was obtained against the debtor in which no reference or allusion was made to the attachment, the omission of the usual phrase “with privilege on the property attached,” did not discharge the surety on the release bond.

In the other class of cases, where the privilege does not result from the seizure, but is created by, and is a legal accessory of, the debt, it exists independently of the judgment. In Parker vs. Starkweather, 7 N. S. 340, plaintiff seized, under fieri facias, a quantity of blacksmith’s tools, which defendant sought to have released, under article 644 of the Code of Practice. The tools would have been exempt from seizure under execution on a judgment for an ordinary debt; but they were liable to the lessor’s right of pledge and privilege ; and the suit in which the judgment was rendered was for rent. The court, reversing the judgment of the lower court, which released the seizure, said :

“It is necessary to remark that, in this instance, the seizure was made under a fieri facias; but the suit in which the judgment was rendered was for rent; and we are of opinion that the privilege of the lessor was not lost by the form of execution in which he sought to enforce it.”

In Holmes vs. Holmes, 9 Rob. 118, the wife, entitled to a tacit mortgage, omitted to pray for its recognition ; and she sought, by appeal, to have the judgment so amended as to allow her mortgage rights, and to permit her to enforce them. The court said:

“If the appellant is entitled to a mortgage on her husband’s property, to secure the amount sued for, it arises from the law itself, and there is, perhaps, no necessity for mentioning it in the judgment, as a mere omission to recognize it could not deprive plaintiff of its effect, if she is really entitled to enforce it. 'It will be time enough to inquire into plaintiffs alleged right of legal mortgage, if ever it comes in conflict with the rights of her husband’s creditors.”

In Gustine vs. Union Bank, 10 Rob. 418, the same learned court, through a different organ, laid down the same doctrine in these terms:

. “ If, under the law, the debt creates a privilege or tacit mortgage, such privilege or tacit mortgage exists independent of the judgment rendered upon it.”

To bring the present case within these decisions, it is only necessary to add, that the suit was brought upon the lease and the rent notes; so that it was a suit for rent; and the debt was one which created, and to which was attached as a legal accessory, not merely a privilege,-but a right of pledge on the movables of the lessee, and those belonging to third persons found on the leased premises. R. C. C. article 2705, et seq. 3218.

It is elementary that a judgment is conclusive, and constitutes rem adjudioatam only with respect to what was the object of the demand. R, C. C. 2286. The mortgage creditor, when he proceeds via executiva. neither asks for nor obtains any judgment in personam against the debtor. He merely asks that the mortgaged property be seized and sold in satisfaction of the mortgage debt. Suppose he should choose to obtain a judgment in personam on the mortgage notes. Any property of the debtor not exempt by law, might be seized under fieri facias on that judgment; and if the mortgaged property should be seized and sold under that writ, the proceeds would be applied to it, unless some one should intervene and claim a superior right. The mortgage creditor would exhibit his mortgage, and if it outranked the claim of the opposing creditor, the opposition would be defeated. To enforce a mortgage or a privilege the property must be sold; and, as the court said in Parker vs. Starkweather, 7 N. S., the form of the writ can not prejudice the privilege.

The landlord having a privilege and right of pledge, as in Barker vs. Starkweather, chooses to obtain a judgment in personam against his debtor for the rent due, and to enforce it by fieri facias. The proceeds of sale will be paid to him, of course, unless a superior right is asserted. In answer to such a claim the lessor would show that the suit in which the judgment was rendered was for rent, and that the property sold was that which was affected with his privilege and right of pledge; and no claim inferior to this could be set up successfully against him.

As the court well said in Holmes’s case, 9 Rob. 119, it will be time enough to inquire into the right of the creditor to the proceeds of the sale under execution, when it conflicts with the rights of others. Until such a conflict does arise in a contest for the proceeds, the privileged creditor, whose debt creates the privilege, has no occasion to assert or to maintain his privilege, because, no matter what may be the form of the judgment or the writ, the privilege exists independently of either.

The Code of Practice, article 156, provides that “ if one demand less than is due him, and do not amend his petition in order to augment his demand, he shall lose the overplus;” and article 157 declares that if the creditor fail to claim the interest due him, he can not afterward demand it in another action.

These articles relate to the amount of the demand; and they can have no application to cases in which the creditor, entitled by law to a privilege, proceeds in personam for the debt, and seizes, under fieri facias, the precise property affected with his privilege. In this case, we have seen that Pond, if he had paid the debt before judgment, would have become dominus litis, and might have amended the pleadings, and caused the furniture subject to the lessors’ privilege to be seized provisionally, and sold in satisfaction of the debt. If he had paid after the judgment against Mrs. Boureier, he might have had execution issued on that judgment and have seized and sold any property belonging to Mrs. Boureier, not exempt by law, including the furniture in the leased premises; and no one, not having a right superior to that of the lessor could have competed with him for the proceeds. The furniture, being still in the leased premises, was subject to the rights of the lessors, just as it was at the beginning and as it was at the end of the term for the rent of which Pond was surety. It was also affected with the lessors’ privilege lor the rent under the new lease; but if the lessors had received tharent due under the first term from the surety, he would have been subrogated to their rights under the first lease, which was superior to that under the new lease. It would have been bad faith on their part, and the law would not have permitted them to assert even equality of right, much less superiority, to the prejudice of their subrogee, the surety; and they would have been compelled to yield to him in rank and preference.

It is not shown that Mrs. Boureier owed any other debt; and non con-stat that there would have been any conflict or contest for the proceeds, of the sale of the furniture found in the leased premises; but if such conflict had arisen, nothing had occurred to impair the privilege and right of pledge by which the debt was secured.

There is no evidence in the record of any act on the part of the lessors by which the surety’s right of subrogation was either lost or impaired; nor of any fact which discharged his liability under the contract. We do not know, because the record does not inform us, and we can not go outside of it to inquire, what may have occurred since the appeal was taken tending to the discharge of the surety. The transcript discloses no error in the judgment appealed from; and that is all that we intend to decide, and it is precisely what we do decide.

The judgment appealed from is, therefore, affirmed with costs.

DeBlanc, J. I concur in the decree which precedes.


source: Caselaw Access Project

author: DeBlanc, J.

license: Public Domain

text:
    No. 6416.
    State ex rel. Louis Fix vs. F. J. Herron, Recorder of Mortgages, et al.
    The deed oí a State tax collector is not conclusive ol the legality of the title conveyed by it. If such a title is properly put at issue, its validity must be proved by the party claiming under it,
    A mandamus will not issue, at the instance of a purchaser of real estate at a tax sale, to compel a recorder of mortgages to erase the privileges and mortgages recorded against the property (when the holders of the liens oppose their erasure), until such erasure shall have been decreed in a regular suit, conducted contradictorily with all the parties holding.the recorded liens.
    A mandamus can only bo appropriately invoked, to enforce an ascertained right, or compel the performance of a recognized duty, in cases whore the ordinary legal processes do not afford an adeauate remedy.
    ^PPEAL from the Superior District Court, parish of Orleans. Lynch,

      Charles Lauque, for relator and appellant.

      Hornor & Benedict, for Beoorder of Mortgages.

      8. P. Blanc, Assistant City Attorney, for city of New Orleans.

      James Gi'áham, curator ad hoc, for absent heirs.
   The opinion of the court was delivered by

DeBlanc, J.

In a petition filed on the nineteenth of May, 1876, Louis Fix alleges that he purchased, for State taxes, three lots of ground situated in the city of New Orleans, and which, heretofore, belonged to and had been assessed, two in the name op Henry Decker, and one in the name of Widow William'Piles; that, after the expiration of the delay fixed by law for’the redemption of property so acquired, his titles to those lots were confirmed by the Auditor, and that by virtue of said sales and their confirmation, all liens and incumbrances previously recorded against said property havo been annulled and should be erased.

This proceeding is directed against F. J. Herron, who, in May, 1876, was the Beoorder of Mortgages for the parish of Orleans. As to those for whose benefit those liens and encumbrances have been registered, the prayer of relator’s petition is merely that they be notified of his proceedings and made parties to the same. The recorder was ordered to comply with the demand of Fix, or show cause, on the 24th of'May, less than five days from the filing of that demand, why the alternate writ of mandamus allowed against him should not be made absolute.

The recorder and the other parties appeared in the lower court and excepted to plaintiff’s action, on the ground that he -has mistaken his, remedy, and that, considering his own averment, he is not entitled to the writ which he seeks to obtain. That exception was sustained, plaintiff’s rule discharged, and he has appealed.

Under the constitution of 1868, the tax collector’s deed must be received as the evidence of a valid sale; this is not disputed, but that evidence is not conclusive,' can be contradicted; and, when contradicted, ceases to uphold the assailed title, which, then, must fall, unless its validity be otherwise established. If so, those who have or claim, in or on the property, a recorded right, must be not merely notified of an application to compel an officer to destroy that right, or the evidence of that right, but regularly cited to appear and protect their interest.

The actual recorder, the recorder who alone could now comply with plaintiff’s demand and erase the liens and incumbrances bearing on the property which he claims, is not before this court; but, were he here, the application for a mandamus would have to be refused; when the cancellation of mortgages and privileges is asked by one, opposed by another, that cancellation can properly be ordered but in an ordinary proceeding, contradictorily with those who control the inscriptions, and not, assuredly, by a writ of mandamus. 4 L. 17; 5 L. 329; 6 L. 454; 6 R. R. 299; 8 R. R. 97; 11 R. R. 161.

The application, against the recorder is at least premature. Until it shall have been decided that said inscriptions have been annulled by tho cpllector’s sales, what is the recorder’s duty ? Is it to disregard the protest of those in whose favor they were made, and erase, cancel, and destroy them ? It is the very reverse.

If hereafter and in a suit between the contending parties, it be held that the title of relator is valid, that the collector’s sales have swept the mortgages and privileges affecting the property, and, notwithstanding the decree, the recorder refuses to erase those incumbrances, he shall then be compelled, by a writ of mandamus, to perform that duty.

It may be said, every one of the parties who claim to have any right in or on the property acquired from the collector is before the court, but how ? They were merely notified, some as late as the 22d of May, that this application against the recorder would be tried, and when ? According to the notice, on the day it was served; according to the application, on the 24th of said month. In form as in substance, plaintiff’s action is irregular.

"Who are the parties who have been thus notified ? They are — one, the former owner of one of the lots sold, the others are heirs and creditors, minors and absentees; and, even if a mandamus were, as to plain-, tiff, to them, and in this case, an appropriate remedy, those parties ox-those by whom they were represented, were not allowed a reasonable delay 'to prepare and interpose their defense.

Under no allegation of his application, no part of his evidence, is plaintiff entitled to. the extraordinary remedy, which can be allowed but to compel action and coerce the performance of a pre-existing duty, to enforce an already recognized right, and not to ascertain either the existence, .the satisfaction, the. loss, .the nature, or extent of that right; to supply the want of any other adequate remedy, and not to supersedo the ordinary forms of ordinary proceedings.

“ In determining upon the right to relief by mandamus, the test to be applied is to inquire whether the party aggrieved has a clear, legal right, and .whether he has any other adequate remedy, since the writ only belongs to those who have legal rights to enforce, and.who find.themselyes without an appropriate legal remedy. In this sense, it may be regarded as a “clemier ressort,” etc. High, Extraordinary Bemedies, sec.10.

There is no error in the judgment appealed, from, and that judgment is affirmed with costs.


author: Egan, J:

text:
    No. 6740.
    J. M. Tupery vs. T. M. Edmondson.
    In counting the ten days delay within which the bond for a suspensive appeal írom a judgment of a lower court must be filed, neither the day on which the judgment is signed, nor Sundays, nor the day on which delay expires, is to be included.
    ^PPEAL from the Sixth District Court, parish of Orleans. Righto)', J.

      Emile Legendre and Victor Olivier, Jr., for plaintiff and appellee.

      Edward Phillips, for defendant.
   On .Motion to Dismiss.

The opinion of the court was delivered by

Egan, J:

The appellee moves to dismiss this appeal because the bond was not filed within ten days as required by law. The judgment was signed on the eighteenth of June, 1877, and the bond filed on the thirtieth of the same month. One Sunday was included in this time. We held in the case of the State ex rel. Mercier vs. the Judge of the Superior District Court, 29 An. 224, that by the express textual provision of the Code of Practice, article 575, Sundays are excluded in the count of the time within which the appeal is to be taken, and that the provision of article 318 C. P., “but in all cases where delay is given either to do some'thing or to answer neither the day of serving the notice nor that dn: which the act is to be done or the answer filed are included ” applies to; taking appeals. The law and the courts do not favor the dismissing .of-appeals. Omitting from the count in this case the day the judgment was signed, the intervening Sunday, and the day the bond was filed, it-is in time.

The motion to dismiss is overruled.


author: Spencer, J. Egan, J.

text:
    No. 6359.
    City of New Orleans vs. New Orleans Canal and Banking Company.
    The return of the city tax assessor, setting forth the amount of the taxable capital of a hanking corporation, will be held as true, until the contrary has been shown by the bank.
    When a bank claims that a portion of its capital is invested, in United States bonds, stocks, or currency, it must show affirmatively, the exact amount of its capital so invested. Otherwise, its capital thus invested will not be exempt from taxation.
    "The mere fact that at various periods during the year the tax is assessed, the bank ” held” large amounts in United States currency, will not exempt its capital from taxation to the extent of those amounts, unless the bank proves that the currency so “ held” was a part of its capital.
    While the ordinary deposits of United States currency (or national bank notes), in a bank by its customers enter into, hnd form a part of its asseis.they at the same time create liabilities of the bank, and thus offset themselves as assets. Such deposits therefore do not constitute a portion of the capital of a bank, and hence the bank can not claim that its capital shall be exempt from taxation to the amount of such deposits.
    The capital of a bank which is subject to taxation, as capital, is made up of the balance of its assets remaining after deducting its debts, that portion of its assets exempt from taxation, and that portion which is taxed under another name than capital.
    United States currency, and national bank notes belonging to a bank, although nontaxable, are a part of its assets, and in ascertaining the real amount of its taxable capital, such currency, and notes, must be held as compensating the debt due depositors, and thus, pro tanto, extinguishing the liability of the bank.
    APPEAL from the Superior District Court; parish of Orleans. Lynch, J.

      8. P. Blanc, Assistant City Attorney, for plaintiff and appellee.

      Finney & Miller, for defendant.
   The opinion of the court was delivered by

Spencer, J.

The city of New Orleans sued the defendant Canal Bank, for a tax of one and one half per cent on its capital not invested in real estate. The value of such capital is assessed at the sum of $700,000, making the amount of tax $10,500. There was judgment final on default in favor of the city and the bank appeals. The case comes up on a statement of facts, of which the following are those material to the issue :

“ 5th. It is admitted that the proper printed forms to be filled up with, item's of taxable property were duly served by the assessor upon the president of the defendant bank, and that he returned it filled and signed" and that it showed no taxable capital.”

“ 6th. That the capital of the defendant paid up is $1,000,000, of which $200,000 is invested in real estate and taxed as such, and that it held from first February to first July 1875 the amounts of “greenbacks” and national currency indicated by Exhibit ‘Z’.hereto annexed.”

The Exhibit “Z” shows the amount of greenbacks and national currency respectively held by the bank for each day from first February to-first July — the dates between which the law requires the assessment to be made. The amounts fluctuate in “ greenback ” between $1,535,000 and $762,000, and in national currency from about $400,000 to $85,000. There-was on hand June 30 $762,000 in “greenbacks” and $158,000 in national currency — making total $920,000.

It is conceded by both parties that whatever part of the capital of the-bank, was invested in United States, stocks, bonds and currency, is by jhe laws of the United States exempt from taxation.

The defendant on whom lay the burden has offered no proof that any part of the capital of said bank was so invested. The admission in the-statement of facts is that over and above the amount $200,000, invested in real estate, the bank had a paid up capital of $800,000 “ and that it held from first February to first July 1875, the amounts of greenbacks and national currency indicated by Exhibit “ ‘ Z.’ ”

It is not shown that the currency thus “ held ” was its capital, or any part thereof. The Exhibit shows that at several periods between first February and first July, it “held” as much as $1,750,000 of currency of both kinds. There must have been at these times $950,000 of deposits,, as the bank only had $800,000 of capital uninvested in real estate. Are we to presume that the bank had loaned its “ deposits,” and kept its “ capital,” when on thirtieth June it only held $920,000 of currency? The counsel for defendant assume that such was the fact, but there is no proof of it, and we think the fairer presumption would be that it loaned or used its “capital” and kept its “deposits.” Nor does the fact that the president in his return reported no taxable capital materially affect the case, because it is fully offset by the fact that the assessor, (who under the law is empowered as a public officer to decide primarily) reported the bank as having $700,000 of taxable capital. The presumption is that his report is true until disproved. "We find no sufficient proof of the error to justify us in reversing the judgment of the court a qua. If the bank’s capital was invested in United States bonds or currency and thereby exempt, the fact of such investment should have been affirmatively proved and not left to inference and doubt. "Where one claims the benefit of an exemption, or that he is within an exception, it is his duty and the onus is on him, to make the facts appear clearly and distinctly upon which he rests his claim.

It is therefore ordered adjudged and decreed that the judgment appealed from be affirmed with costs of both courts.

On Rehearing.

The opinion of the court was delivered by

Egan, J.

Since the former hearing of this cause the evidence has been supplemented by consent of counsel by the following which is accepted by both parties “ as a correct statement of'the average condition of the bank during 1875,” the tax for which year is the matter in controversy:

Statement of the Affairs of the New Orleans Canal and Banicing Company on Monday, June 28,1875.

1. Real estate.......................................... $182,516 85

2. Stocks...............I.............................. 8,228 35

3. Taxes paid.......................................... 14,431 65

4. Suspended debts..................................... 54,740 80

5. Foreign and domestic bills protested.................. 26,949 73

6. Notes and bills discounted............................ 1,833,146 41

7. Foreign and Domestic exchange...................... 919,996 51

8. Interest due on loans on call......................... 3,349 47

9. City seven per cent gold bonds ($50,000)............... 25,750 00

10. Gash items—

11. Gold...................................$32,419 80 •

12. Legal tender...........................974,777 17

13. Checks sent to Clearing-House..........172,409 73

--- 1,179,606 70

$4,248,716 47

14. Capital stock............................$1,000,000 00

15. Profit and loss........................... 99,694 00

16. Dividends unpaid........................ 46,556 00

17. Individual depositors.................... 3,044,957 19

'18. Foreign banks and banking____,......... 48,061 78

19. Circulation.............................. 9,447 50

-$4,248,716 47

The amount invested in real estate, and which can not of course be •taxed as capital, because taxed as real estate, appears from this statement to be $182,516 85, or $17,483 15 less than the amount allowed by the assessor on this account, so that, taking it from the original capital of $1,000,000, there would be left .$817,483 15 of the original capital.

It is claimed by the defendant and may be, for the purposes of this ease, conceded that the bank is not taxable upon its deposits because they represent not assets but liabilities and form no part of its capital proper. Does it, however, follow that it is not taxable on its otherwise taxable assets, because it owes at the time more to its depositors than it has funds in its vaults to meet on demand ? If so, then the most solvent bank in the country, which by good management or, good fortune has doubled.its orignal capital, and by its charter or the ¡consent of its stockholders (ptherwise given) declares no dividend until the end of a. term of years or until its final liquidation, but keeps reinvesting for-profit its acquisitions as well as its original capital, wouid be exempt from taxation on that account if it had not always in its vaults the-means of immediate payment of its deposits, when they equal or exceed the original capital, and we need go no further in the inquiry. This, however, is not pretended in the ease at bar, in which the deposits or rather the amount due to the depositors is shown to be over three times as much as the original capital invested. The truth is that while deposits with a bank constitute to that extent debts or liabilities, all the-assets of the bank, no matter of what they consist, provided only they be available, must be deducted from the amount of the deposits-before it can be ascertained how much, if any, its capital stock, has been diminished. Now, it needs no argument to demonstrate-that deposits are made in whatever currency is accepted or created as a circulating medium at the time, say in the case at bar in legal tender notes of the United States, which are themselves exempted by law from, taxation. Suppose then that three millions of dollars was so deposited with the defendant and that it had an equal amount of legal tender notes with which to meet the call of its depositors, will it be urged that because those notes are themselves exempt from taxation they should be counted and considered no part of the assets of the bank, notwithstanding they furnish the means of immediate redemption of its liabilities on this account, and that although the bank should do, what in law and good faith it is bound to do, and so long as it continúes business must do — that is, should extinguish its liability for deposits by the use of the legal tender notes in its vaults; that, its capital represented by the remainder of its assets, however large, .and though in such form as not to be themselves non-taxable, shall not be taxed simply because its deposits being debts and not capital and its legal tender notes, which are exempt by the terms,of,,the,law, when added together aggregate an amount equal to or greater than the remaining assets of the -bank, and therefore show an absorption' of the-total capital? The fallacy of this ^reasoning becomes at once apparent •when we see that in the case put the bank might be able to repay its-stockholders the amount of the capital stock and a large profit or dividend besides from other resources, after redeeming its entire deposits-with the legal tenders which formed part of its available assets.

It is obvious from the statement furnished by' the defendant and accepted by the plaintiff that the former invested its capital in something more than and other than, greenbacks ordegal tenders, and it is this excess, after deducting such property as is taxed in other forms, which the city claims the right to tax. Let us put the case in another form to test the correctness of this claim. The paid-up capital stock of the bank is one million dollars. On the faith of this and owing to the public confidence inspired by the character of its managers, three millions of dollars in greenbacks are deposited with it the moment it is opened for business; and that before it has had opportunity to invest- or part with one dollar of its capital the whole amount of these deposits is recalled; now, according to the argument of defendant’s counsel, you must add the exempted greenbacks to the exempted debts due the depositors, and thus make up a sum of exemptions of six millions of dollars, instead of permitting the one to do, as it does in point of fact; i. e., offset or 'pay the other. In the case put the bank would be left with its original capital (which is taxable by the very terms of the law) undiminished in the smallest degree, and shall not be taxed to the extent of a single dollar; and yet this would be the necessary consequence of the argument'and of the reasons for exemption set up by the defendant’s counsel.

The fact that the original capital of the bank, instead of being invested as in the case put, is invested in or represented by available securities which are not exempted from taxation, provided they be not themselves taxed in another form, only makes it come more strictly within the' law subjecting it to taxation.

To make good the argument it is necessary that the entire capital of the bank should be invested in greenbacks and nothing else and that it should have no other means of redeeming its deposits.

Now, it may be conceded as before remarked for the sake of the argument, that neither deposits nor greenbacks should be counted in ascertaining whether and how far the defendant is taxable on its capital. But as the latter afford pro tanto a means of paying the former, on this theory the balance must be struck between them. The statement of the defendant) which is accepted by the plaintiff, shows what are put down as assets, $4,248,716 47; from which deduct amount due depositors, $3,044,957 19, less legal tenders, $974,777 17 as stated, equal to $2,070,-180 02, and we have a balance of $2,178,536 45. But as the same legal tenders, already used to offset so much- of the debts due depositors, also goes to make up the sum of the assets, they must be deducted from this balance, which leaves still..............................$1,203,759 28 Fr.om this deduct—

Amount invested in real estate and taxed as sucü.....................................$182,516 85

Taxes paid, which are not assets............. 14,431 65

Suspended debts, as per statement.......... 54.740 80

Aggregating...................................... 251,689 30

Which taken from the last balance of assets leaves still... -. $952,069 98

Deduct further amount charged to profit and loss, $99,694; amounts due foreign banks and banking, $48,061 78; and amount of circulation, $9447 50; aggregating $157, 204 28, and we would still hafe a balance of $794,865 70, or $94,865 70 more than the amount for which the bank was assessed; add to this the suspended, but not necessarily non-collectible debts and not put down as such, which amount as per statement to $54,740 80, and we have an excess 1 beyond assessment of $149,606 50, from which, treating it as a debt, deduct if you will amount Of dividends unpaid, $46,556, and we have still an excess 'of $103,050 50. But in fact dividends are not properly debts, but only shares of profits; so that, even accepting the theory of the defendant’s counsel, that “ the capital of a bank like the capital of a merchant or individual consists of the value of its assets after deducting the amount of its liabilities, no error to the' prej udice of the bank has been committed. To arrive at any other conclusion we would have to eliminate from its assets those which are most available and daily used to redeem its deposits; i. e., the currency in its vaults, although it may equal or even exceed those deposits; we should not only have to do this, but to go further and hold as insolvent a perfectly solvent bank, which, according to its own counsel,' “ declares annual dividends,” and which, according to the statement furnished from its own books, had at its date declared a dividend of which $46,556 remained still unpaid, and which dividends, in the very nature of things, are only derived and derivable from the profits in money on the stock invested, to say nothing of the actual value of its property and assets in other forms. It has, however, been expressly decided by this court that all moneys deposited in bank otherwise than as special deposits are its property, in other words form part of its assets (see 10 An. 343, and same 346), in other words its means of meeting its liabilities, whether to depositors or other persons, and also of paying any dividends or distribution of profits to its shareholders.

If those deposits or other funds which may be found in the vaults of the bank consist of non-taxable government notes the utmost limit of the decisions, both of our State courts and those of the United States to •which, we have been referred by the able and experienced counsel for the defense is that so much of the capital of the bank as is represented by such non-taxable notes is itself non-taxable, and not that all its capital, no matter how invested, is non-taxable. In one of those cases, reported in 9 Wallace, p. 357, the court said: “ This capital may consist of cash or of bills and notes discounted and of real estate combined with them,” precisely the case at bar, and again, “ the whole of it may be invested in bonds of the government or in bonds of the State or in bonds and mortgages,” and a “ tax upon this capital is a tax upon the bank.”

In Bank of Commerce vs. New York, 2 Black, 620, a portion of the capital of the bank was invested in real estate and the balance in stocks, bonds, and securities of the United States, and it was held “ that such portion as was invested in government securities teas not liable to taxation by the Slate.” In the Bank of New York vs. Supervisors, 7 Wallace, 26, the court maintained the exemption of so much of the capital of the bank as was invested in treasury notes or greenbacks.

We are also referred to the case of Home Mutual Insurance Company vs. City of New Orleans, 20 An. 447, and Cooley on Taxation, p. 164, No. 1, as authority for the proposition that it is the actual and real capital of a corporation represented by the property in which it has been invested which is the subject of taxation, and not its merely nominal capital; and that if the capital be invested in non-taxable securities it is not taxable. That the plaintiff has followed the rule thus laid down so far at least as to endeavor to ascertain and to tax the actual and not the merely nominal capital of the defendant is apparent, as the tax is claimed not upon the nominal or fixed capital of the defendant of one million dollars, but upon its supposed actual capital of seven hundred thousand dollars. Both parties seem to agree to this standard of assessment.

We have been referred by defendant’s counsel to the case of Bailey vs. Clark et al, 21 Wallace, p. 284, for the proper interpretation of the term “ capital ” in matters of taxation. In that case the assessor claimed that not only the fixed capital of the defendants employed in banking should be taxed, but that all moneys borrowed temporarily by them, from time to time, in the course of their business formed part of their capital stock, and was liable as such to taxation, and the court held that it was not.

The same principle is embodied in act of Congress passed in 1872, 17 Stat. at Large, p. 256, in regard to the tax imposed by the government of the United States, which is referred to by Mr. Justice Field in the case quoted. That learned judge gives a somewhat different interpretation of the meaning of the term “ capital ” in matters of taxation as applied to corporations, and one which is not exactly reconcilable with that announced in the twentieth Annual case and the authorities before cited. He says, in the twenty-first Wallace case, that “ when used with respect to the property of a corporation or association the term has a settled meaning; it applies only to the property or means contributed by the stockholders as the fund for the business or enterprise for which the corporation or association was formed;” and again: “We are satisfied that the. term as used in the statute was intended to embrace only the fixed capital employed in the business of banking as distinguished from deposits and temporary loans made in the regular course of business.” Burroughs on Taxation, p. 654, announces the same doctrine.

' It is, however, needless for the purposes'of the present case to attempt to reconcile these diverse definitions of what constitutes “ capital” as an object of taxation, as the city concedes by not taxing it that the amount of fixed capital paid in by the stockholders is not the standard and only claims the right to tax the defendant ón an amount less than that fixed capital by three hundred thousand dollars; a [concession of which the defendant can not complain and against which no argument is urged based upon that ground.

This is, however, no longer an open question. The mode of assessment adopted in this case has prevailed in Louisiana since 1830, when that eminent Judge Porter announced it as the proper one in the case of the Louisiana Insurance Company vs. Morgan, 8 N. S. 631. Our predecessors reaffirmed that doctrine in the State vs. Louisiana Mutual Insurance Company, 19 An. 475, and in Mechanics’ and Traders’ Bank vs. City of New Orleans, 23 An. 307, in which case the precise point at issue in the case at bar was determined, the court saying that an entire exemption of its capital from taxation could not be claimed by the corporation, because part of it was invested in non-taxable securities. So also it is held under the revenue laws of the United States. See 21 Int. Rev. Rec. 353.

The ease in 21 Wallace is relied upon by defendant’s counsel simply to show that deposits are not liable to taxation, and it will be perceived from our computation that they have not been counted, but on the contrary have been deducted from the amount of “ actual capital as represented by the property in which it has been invested ” in accordance with the rule as announced by Judge Cooley, by the Supreme Court of the United States in the other cases cited, and by our predecessors in the twentieth Annual case. A review of all of these latter authorities makes it also apparent that while so much of the capital stock of a corporation as may be invested in non-taxable securities is itself nontaxable, even if that amounts to the whole of the capital of the corporation, it is not true that where such investment in non-taxable securities amounts to less than the amount of capital of the bank or other corporation the excess represented by taxable property of any kind is non-taxable. Indeed, this is practically conceded by the defense in the case at bar by the claim set up that 'the defendant always had on hand greenbacks or legal tenders enough together with the value of the real estate which is taxed as such to make up the sum of defendant’s capital.

The error and the fallacy in the position of the defendant is that by reason of this fact entire exemption from taxation on its capital is claimed, notwithstanding its own statement shows a large amount of property or of “ capital invested in and represented by property” which is not non-taxable or exempt under any provision of law; we need only instance one or two items in the statement, L e., “ notes and bills discounted, §1,833,146 41,” “ foreign and domestic exchange, §919,996 51,” an item of itself not very far short of the whole amount of legal tenders for which exemption is claimed. The city has not claimed or sought in the assessment complained of to tax the deposits of the defendant, i. e., the debts due by it to depositors, which are strictly not deposits b.ut only the consequences of deposits. .Nor has it sought to tax the non-taxable government legal tenders in the vaults of the bank, as will be seen by recurring to the tabular statement already made by us in this opinion. All that the city claims, and we think correctly, is that though themselves non-taxable, these legal tender notes shall be counted as they are used and designed to be used as assets of the bank for the purpose of offseting and extinguishing so much of its indebtedness to depositors, and that because so much of the capital of the bank is invested in non-taxable government securities, it does not follow that the remainder, which is not so invested, shall not be taxable.

Any other view would double in favor of defendant the amount of exemption; the legal tenders would be counted twice for that purpose— once because they are legal tenders, and once because they represent so much of deposits — -while, if there is any force in the latter ground of exemption, it would only result that the legal tenders were exempted not twice over but for the two reasons urged by defendant’s counsel, either of which if well founded will suffice, but not both with the effect claimed to duplicate the exemption.

While we do not for- a moment argue, however, that deposits in the sense of debts due depositors, should be counted in estimating the real and actual capital of a bank for the purposes of taxation, neither are we prepared to give our assent to the doctrine that money in the vaults of the bank, although derived from deposits, is exempt from taxation for that reason alone. See Burroughs, p. 655, and Milton vs. Savings Institution, 17 Wallace, 109. On the contrary, we think it has been properly adjudged in the cases already cited to be the property of the bank.

We see no error in our former decree in this case, which is therefore ordered to be affirmed.


author: Manning, O. ¿T.

text:
    No. 6784.
    T. Eschert vs. W. C. Harrison et al.
    When the sheriff is not interested in an injunction suit, and is only connected with it by having had a notice served on him that the writ was suspended, he is not a necessary party to an appeal in such a suit.
    The omission to state the day oí the month in the date of an appeal bond, when th« month and year are given, is supplied by the date of the filing of the bond. Failure to set forth specifically the amount of an appeal bond is not ground to dismiss the appeal. It will be assumed that it was given for the amount prescribed in the order of court granting the appeal.
    Indicating the clerk of the lower court, the payee in an appeal bond, by abbreviated signs is not fatal to the bond, if its recitals elsewhere make certain what court and clerk were meant.
    The incompleteness of a record, caused by the loss of a portion of it, when the loss is properly certified by the clerk of the lower court, is not a sufficient cause for the dismissal of the appeal.
    APPEAL 'from the Fifth District Court for the parish of Orleans. Cullom, J.

      Labatt & Clinton, for plaintiff and appellant.

      O.L. Hall, for defendant.
   On motion to Dismiss.

The opinion of the court was delivered by

Manning, O. ¿T.

The motion to dismiss is based on four grounds;

1.That all parties to the suit are not made parties to the appeal.

It is an injunction, and the sheriff is the party who has not been cited. A sheriff who is a party to proceedings by injunction only for the purpose of notifying him that the execution of the writ has been suspended, and who has no interest in the result, need not be made a party to an appeal from the judgment of the lower court. . Boguille v. Faille, 1 Annual, 204. Francis v. Scott, 5 Annual, 668. Boykin v. O’Hara, 6 Annual, 115.

2.That there is no bond of appeal such as is required by law.

There is no date to the bond, no sum mentioned in it, and not the proper payee. The day of the month is not inserted, but the month and year are mentioned. The date of filing supplies the omission. The omission of the amount of the bond is not fatal. The bond is read in connection with the order of the court, and the law implies that it was given for the prescribed sum, although no specific sum is mentioned in it. This ruling is now too old to be disturbed. Mason v. Fuller, 12 Annual, 68. Stille v. Beauchamp, 13 Annual, 604. The payee of the bond is the clerk of the 5th Dt. Ct. parish of Orleans. The appellant says the Fifth District Court is meant by these abbreviations, and we regret that we are obliged to tolerate this careless and slip-shod way of preparing legal papers, because in a subsequent part of the bond the names of the suit and court are properly recited, and render certain what court is meant.

3. That the record is incomplete.

The certificate accounts for the absence of a particular record by stating that it is lost. The clerk could nowhere find it, and the appellant cannot at this stage of the case suffer because of its loss.

4. That this court is without jurisdiction.

The sum claimed in the petition for injunction exceeds five hundred dollars.

The motion to dismiss is refused.


author: Spencer, J.

text:
    No. 6686.
    State ex rel. Hoey & O’Connor vs. J. G. Brown, Administrator of Accounts.
    It is the duty of the judge of the lower court to fix the return day of an anneal, and if a wrong day is fixed by him, the annellant will not be nrejudieed thereby.
    Merely submitting to the execution of a judgment by the sheriff, is not such an acquiescence in the judgment as will debar the narty east from taking a devolutive anneal.
    No exparte statement, or motion, hy one of the narties to a suit, made in the court below, can imnair.the other narty-’s rig-ht of anneal.
    A nublic officer who has done a certain act he was ordered to do, by a decree of court in a mandamus proceeding, may take a devolutive appeal from the decree, when the act done in obedience to the decree is susceptible of being effectively undone.
    APPEAL from the Third District Court, parish of Orleans. Monroe, J.

      B. F. Jonas, City Attorney, for defendant and appellant.

      Hornor & Benedict, for plaintiff.
   On Motion to Dismiss.

The opinion of the court was delivered by

Spencer, J.

Relators proceeded by mandamus to compel the defendant to register a certain judgment obtained by them against the city of New Orleans, and to issue them thereon certain cash warrants.

Upon trial the mandamus was made peremptory. Thereupon the defendant applied for and obtained an order for a suspensive appeal without bond, under the act exempting the city of New Orleans from giving bond. On motion we dismissed that appeal, holding that the city of New Orleans was alone entitled to said exemption, and that the city was no party to this suit.

On motion of relators, in the court below, and on suggesting that said suspensive appeal had been dismissed, and that said decree was now final, and further that the defendant refused to obey the mandamus, it was on first May 1877 ordered that defendant show cause why he should not be punished for contempt.

On same day defendant answered stating that he had complied as far as possible with the mandate and registered the judgment, etc. On fifteenth May 1877 the defendant applied by petition for a devolutive appeal, which was granted on bond and made returnable on first Monday of June 1877. On twenty-first May 1877 on motion of relators and on suggesting that a compromise had been effected herein, it was ordered that satisfaction of the decree be entered of record. This order appears to have been rendered ex parte by the court a qua. That devolutive appeal is now before us. The record thereof was filed in this court thirty-first May 1877.

Relators move to dismiss on the grounds

First — That by act forty-five of 1870, extra session, regulating appeals, it is provided, “ all appeals from the parish of Orleans *- * * shai be returnable on the first and third Mondays of each month of the session ” of the Supreme Court. That' by law the session of said court at New Orleans ends on the last of May and that therefore an appeal taken on fifteenth May should have been returnable on the first Monday of November.

The law imposes on the judge the duty of fixing the return day, and the appellant can not be prejudiced by his mistakes. If the first Monday of November instead of June Was- the. proper return day — the court not being in session at the latter date — and if the appeal was filed in this court before either day arrived, we can not surely accuse the appellant of want of diligence and see no possible injury to appellee.

Second — The second ground of dismissal is that the defendant has compromised the judgment and acquiesced therein as shown by relators’ motion and the order entering satisfaction.

A judgment is rendered, suspensive appeal taken and dismissed, execution issues and satisfaction of judgment obtained by legal process ! Defendant takes a devolutive appeal and is met with the objection that he can not appeal, that the judgment has been satisfied! The case before us is even stronger. The defendant had to satisfy the judgment or go to jail. There is not here the acquiescence which the law contemplates. It must be the voluntary act of the debtor. Besides the ex parte statement in relators’ motion; filed after the appeal, can not be noticed. If the right to a devolutive appeal can be thus defeated, it would be, in most cases, a delusion and a snare.

Third — The third ground is that a devolutive appeal will not lie from a decree granting a mandamus; and we are referred to the case of the “ State ex rel. Clay vs. Johnson, Auditor” (not reported yet) wherein it seems some doubt was expressed by this court as to defendant’s right to such appeal in such cases. Whatever doubts may have been suggested or expressed in that ease or any other, we have no doubt of the existence of the right in the present case.

The defendant is a public officer, charged with responsible duties, and under heavy bonds to the city for the faithful performance thereof. He has been ordered to register a certain judgment against the city, and compelled to issue to relators certain warrants for- money. He has a right to protect himself, his sureties and the city from this decree if erroneous. If it were manifest that the appeal would be a vain thing, because the things done in execution of the judgment were of a nature not to be undone — were of a nature that once accomplished they could not be relieved against, perhaps it would be true to say no devolutive appeal would lie, for courts are instituted to grant relief and enforce rights, and where these purposes are not attainable they would properly decline to enact a farce. But in the case before us, if we find the decree appealed from to be wrong, we can reverse it, and the city could cause the registry to be canceled and recover back the warrants or money paid.

The motion to dismiss is overruled.


author: Marr, J.

text:
    No. 6696.
    State ex rel. William Henry, vs. the Mayor and Administrators of the City of New Orleans.
    An act of the Legislature proposing an amendment to the constitution has, before it has been ratified by a vote of the qualified voters of the State, no effect whatever.
    The amendment of the State constitution, adopted by the popular vote in November 1874, which forbids any increase of the debt of the city of New Orleans after the first of January 1876, did not design to prevent the payment of any pre-existing legal debt of the city, in the way stipulated in the contract creating the debt.
    No State has the power, either by legislative enactment, or by amendments of her constitution, to impair the obligation of pre-existing, valid contracts.
    When a municipal corporation has legally contracted for certain work to be done, and to be paid for in a certain specified way, the corporation may, on the completion of the work, be compelled by mandamus, to carry out the stipulations as to payment contained in the contract.
    APPEAL from the Third District Court of the parish of Orleans. Monroe, J.

      S. P. Blanc, for plaintiff and appellee.

      B. F. Jonas, City Attorney, for defendant.
   The opinion of the court was delivered by

Marr, J.

On the twenty-third April, 1874, the city of New Orleans, by authority of an act, No. 48, approved thirteenth March, 1871, and of certain city ordinances, entered into a contract with relator, William Henry, for the grading and shelling of a part of Henry Clay Avenue.

By the terms of this contract a part of the price was to be paid by the city, and a part by the owners of the property fronting on the avenue. The portion exigible of the city to be paid in street improvement bonds, and the portion exigible of the front proprietors to be paid in assessment bonds, having ten years to run, and bearing interest at seven and three-tenths per cent per annumwith the distinct understanding that these bonds shall be taken and accepted by said Henry at the rate of seventy-five cents on the dollar.”

Henry completed the work, according to his contract, and to the satisfaction of the city authorities; and the entire contract price seems to have been paid except the sum of $943 03, due by two front proprietors for their proportion, for work completed and accepted by the city on the twenty-sixth May, 1874. The object of this proceeding is to compel the Mayor and Administrators by mandamus “ to proceed by ordinance or other appropriate action, to assess and levy against the property aforesaid, and the owner and owners thereof, according to the provisions of the act No. 48, of 1871, a sum sufficient to meet and cover the bonds to be issued to relator, and to issue “ Street Assessment Bonds,” in amount sufficient to pay him at the rate of one dollar in bonds for every seventy-five cents of his claim and certificates,” in accordance with the act No. 48, of the Legislature, and the contract between relator and the city.

The Mayor and Administrators answer that since the date of the contract the constitutional amendment embraced in act No. 22, of 1874, has been adopted, which prohibits the city of New Orleans and its officers, from issuing any evidence of indebtedness or warrant for the payment of money except against cash actually in the treasury ; and that, therefore, respondents have no authority and are expressly forbidden to issue bonds as asked for by relator.

They state, further, that at the time of making the contract with relator, he was well aware of the adoption of the act No. 22, of 1874, by the Legislature, and knew that it would, if ratified by the vote of the people, prohibit the Council from issuing the bonds described in the contract.

The judgment of the court below granted the mandamus as prayed for, and the Mayor and Administrators appealed.

We attach no importance to the statement that relator was aware of the proposed amendment to the constitution at the time the contract was entered into ; because the other contracting party had the same information on that subject, and neither could have known that it would be adopted. They attached no importance to it, because there is no-provision in the contract by which the relator could compel payment-otherwise than by the assesment bonds: and it is to be presumed that-neither party understood that an amendment to the constitution could retroact so as to destroy contracts entered into and fully executed by one of them at the time of its ratification.

The simple question is, does this amendment, which was ratified at the election in November, 1874, relieve the city of its obligation to comply with the contract in question, by issuing to relator the bonds which he bound himself to receive for his work.

The object of this amendment is manifest: “The city of New Orleans shall not hereafter increase her debt, in any manner or form, or under any pretext.” To enforce this, “ After the first day of January, 1875, no .evidence of indebtedness or warrant for the payment of money shall be issued by any officer of said city, except against cash actually in the treasury; but this shall not be so construed as to prevent a renewal of matured bonds at par, or the issue of new bonds in exchange for other bonds, provided the city debt be not thereby increased,” etc.

Now, it is evident that this article intends to prevent the increase, only, of the city debt; and that it does not contemplate nor prohibit the payment by the city of its then existing debt. We do not think that the assessment bonds in question can be considered as either evidences of indebtedness or warrants for payment of money, within the true intendment and .meaning of this article; but we shall not enter into any further discussion of this question, because we do not deem it necessary for the decision of this case.

The constitution of the United States, the supreme law of the land, article one, section ten, clause one, declares that, “ no' State shall pass any law impairing the obligation of contracts.” This prohibition is addressed to States; and it is applicable to the States, whether exercising, through their Legislatures, ordinary law-making power, or, by conventions or other delegated authority, or in their aggregate capacity, adopting or amending their organic laws. Obviously, the prohibition would be ineffectual if it were restricted to laws passed by'the State Legislatures. Reason and authority require that it shall extend to, and strike . with nullity every law, whether legislative or organic, by which the obligation of pre-existing contracts is impaired. In Cummings vs. Missouri, 4 Wallace, 277, a clause in the constitution of the State of Missouri, which was in violation of that part of article one, section ten, clause one, of the constitution of the United States, which provides that'no State shall pass any ex post facto law, was held, by the Supreme Court of the United States to be inoperative and void.

If, as we think, the correct interpretation of the amendment to the-constitution of Louisiana was not intended to prevent the payment, by the city, of its pre-existing debts, in the manner stipulated and fixed in solemn contracts, the relator is entitled to the remedy and relief which h'e seeks. If, as the city authorities interpret this amendment, it prohibits a compliance by them with its pre-existing obligations and contracts, the effect in this case would be, not merely to impair the obligation of the contract, but to destroy it, and to leave the relator without .remedy, without the means of enforcing payment for work performed by him, in strict accordance with his part of the contract, completed before this amendment was ratified. There can be no doubt that thus interpreted, this amendment would be in flagrant violation of the constitution of the United States, article one, section ten, clause one, and to that ex-téntwould be inoperative and void.

It is clearly the duty of the Mayor and Administrators to pay the relator for his work, in the manner and on the terms stipulated in the contract under which the work was done; and the district judge so decided, in an elaborate and exhaustive opinion.

The judgment appealed from is therefore affirmed with costs.


text:
    No. 6718.
    Samuel Lawson et al. vs. Zachariah Bruen.
    The answer filed in a suit by a defendant admitting that he had In his hands a specific fund, for distribution among certain creditors; and that the plaintiff appeared” to be one of those creditors, with the first preference claim on said fund; but asking that all of said creditors be cited as in concurso; and expressly setting up the plea of general denial, can not be construed as involving a con- ". fession of judgment in favor of the plaintiff; although he may have the ranking , lien on the fund in the defendant’s hands.
    An appeal will not be dismissed on the ground that the appellant confessed judg- ' ment in the court below, when he contests the confession, and it seems to be the only ground of the judgment.
    APPEAL from the Fifth District Court, parish of Orleans. Rogers, J.

      Richard DeGray, for plaintiff and appellee.

      B. C. Elliott, for defendant.
   On Motion to Dismiss.

’ The opinion of the court was delivered by

Spencer, J.

This motion to dismiss is based upon the allegation that the judgment appealed from was rendered on the confession of the defendant. The facts are these: Bruen held the first mortgage on certain' property of one Moran and seized and sold it. After satisfying Bruen’s claim and all prior liens and expenses, there remained for distribution to subsequent mortgages $3788 96, which the purchaser Bruen retained, as shown by the sheriff’s deed. These subsequent mortgages, as certified by the recorder of mortgages were:

First — A general mortgage in favor of Prathers, recorded twenty-fourth of July, 1873.

Second — A general mortgage in favor of Lawson, recorded second of April, 1874.

Third — A general One in favor of A. B. Miller, recorded twentieth of' February 1875.

Fourth — Another general one in favor of Bruen, recorded September 3,1875. ...

Fifth — Another.general one in favor of Prathers, recorded sixteenth . of September 1875.

One of the lots had been sold for State taxes and bought by one Nor-cross; the purchaser taking the property subject to right of redemption out of the fund so left in his hands.

The estate of Simonds also had a claim of some sort on the property or its proceeds, and one Miss Annie Crowley claimed to have purchased it of said Moran.

The plaintiff Lawson, alleging that he had given the usual notices, brought this hypothecary action and prayed that Bruen be condemned to pay the amount of his mortgage, or surrender the property to be sold to pay it.

Bruen .after filing sundry exceptions, answered in substance a's follows on thirtieth April 187-7:

First — -A general denial of all plaintiff’s allegations not specially admitted.

Second — He admits the sale of the property to him, and that after satisfying his claim and prior ones there remained in his hands the sum stated $3788 96.

Third — He then proceeds to show that he had paid and had been legally subrogated to the mortgage of Prathers, which was next iñ rank; that he had paid a certain amount in redemption of the lot sold for taxes, and had paid certain other taxes etc. He then says: “ After these proper deductions, there remains subject to claims of the other creditors of William Moran, of whom the plaintiff Lawson appears to be first in rank, and to all others in interest the sum of $2640 87.” He then further alleges that the mortgage certificate shows the existence of several mortgages subsequent as stated; that it was claimed that Miss Crowley had purchased the property and was entitled to the surplus proceeds; that the estate of Simonds had a claim of some kind thereon of a character unknown to' him, and that William Moran had been interdicted. He alleges that he can not be bound for. more than the price of his purchase and that ali parties having any interest in the balance of the price, should be brought into court, as in concurso. Wherefore he prays their citation accordingly; that he be allowed to deposit the amount due by him in court and thereupon that his property be released from all said mortgages, etc.

On the second of May, 1877, plaintiff took a rule on defendant to show, cause “why judgment should not be entered in his favor as in said petition prayed for, to the extent of said amount admitted in defendant’s answer to be due, to wit, $2640 and costs of suit.”

On the'third of May the court ordered all said parties .named in de-. fendant’s answer as interested, to be cited as in concurso as prayed for by the answer.

On the seventh of May the above rule was tried.

On the fourteenth and fifteenth of May the parties cited by defendant-in concurso, appeared and filed various exceptions against plaintiff and defendant.

On the sixteenth of May the court sustained plaintiff’s rule and ordered “that judgment be rendered herein in favor of plaintiffs, as prayed for, to the extent of the amount admitted to be due herein, to wit: $2640 and costs, and that the defendant Bruen pay the same or that he deliver up the mortgaged property etc. to pay and satisfy the mortgaged debt.” -

This judgment was signed June 16,1877.

Defendant took a suspensive appeal, which plaintiff now moves to dismiss as stated.

To justify the judgment appealed from, the answer must have confessed four things:

First — That Lawson was,a creditor of Moran. .

Second — That he held the first and preferred mortgage.

Third — That due demand had been made.

Fourth — That defendant detained the property subject to the mortgage and that it was liable in his hands for the amount of the judgment.

Now what is the defendant’s answer — what his admission or confession ? Tt is a general denial, and admission, that he has in his hands $2640 87 “ subject to the claims of the other creditors of Wm. Moran (of whom the plaintiff Lawson appears to be first in rank), and to all others in interest” — that there appeared to be conflicting claims upon said fund and that all parties in interest should be cited in concurso and heard and he allowed to deposit the amount in court. He no where admits that Lawson was a creditor of Moran. On the contrary he enters a general denial to all plaintiffs’ allegations which certainly was enough to put plaintiffs to the proof of their claim against Moran and of the demand required by law to precede his action. This judgment was entered up, without proof, on motion and as upon confession. The admissions in the answer did not warrant the judgment.

True the judge a quo, rendered it as on confession, but he did so file-gaily, since as we hold there was no basis' for it. To deny the defendant’s right of appeal, to test the question whether his answer was a confession, would be to deprive him of his rights without trial. The very question which we will have to decide when this case is heard, is whether the defendant did or did not confess, and that same question is raised by this motion to dismiss. In order to determine thé right of appeal, we must of necessity decide whether the judgment was confessed by appellant, and as the judgment has no foundation except the alleged confessions, it would seem that in deciding that the right of appeal exists, we virtually decide that the judgment appealed from is invalid. In other words the motion to dismiss raises the only question involved in •the ease. It would have been better to have submitted the case on the •motion and merits together. At all events we hold that'the defendant has the right to have this court determine whether or not the admissions and confessions contained in his answer authorized the court a qua to enter up, on motion and without proof, a final judgment against him for $2640.

The motion to dismiss is overruled.


text:
    No. 6735.
    State ex rel. Paul Doullut vs. Judge of the Sixth District Court, Parish of Orleans.
    A suspensive appeal will not lie from an order granting an injunction, when itdoes not clearly appear that the injury complained of as arising from the injunction is irreparable; such as the appeal on the merits can provide no adeauato remedy for.
    A suspensive appeal will lie from an order of court, which rescinds a previous order of the court setting aside a writ of injunction on bond.
    j^PPLICATION for writs of mandamus and prohibition.

      A. & W. Vborhies, for relator.

      F. H. Farrar, for respondent.
   The opinion of the court was delivered by

Spencer, J.

The suit of “ A. Saulet et al. vs. Paul Doullut,” is a suit to restrain and enjoin the defendant from carrying on a tallow factory in the Third District of New Orleans, on the ground that the same is á nuisance. Plaintiffs pray that an injunction issue against defendant, which upon their oath, and bond, for $300 the court granted. This injunction was granted on the ex parte showing of plaintiff’s petition and oath.

Defendant thereupon made an ex parte application to sét aside said injunction by bond, under article 307 of the Code of Practice. The court granted.this order, setting aside the injunction on defendant giving bond for $500, which was accordingly given.

Thereupon the plaintiffs, alleging that the acts complained of and enjoined were calculated to work them an irreparable injury took a rule on defendant, to have the order to bond the injunction, rescinded, as having been improvidently granted. Upon trial this rule was sustained and the order permitting the bonding was rescinded and set aside.

Thereupon, and within ten days from the date of the original order of injunction defendant moved for a suspensive appeal from both orders to wit:

'First from the original order of injunction and second from the order rescinding the order permitting the bond.

The judge refused an appeal from either order, and the defendant is before us applying for writ of mandamus to compel the granting of the appeals and for writ of prohibition.

We think he can not appeal from the first, but can appeal from the second of said orders.

First — The record of appeal from the original order granting the injunction could not legally contain any thing except plaintiffs petition, affidavit and bond. No proceedings subsequent, could be reviewed on said appeal, for we would have to pass upon the case just as it stood when the district judge passed upon. it, in order to decide whether he rightfully or wrongfully granted the order. In other words the question presented to us would be, whether or not, on the face of papers, taking all plaintiffs’ allegations as true, they were entitled to the injunction prayed for. So that the case would present substantially the same phase, as if an appeal were asked from an order overruling an exception of “ no cause of action.” This court held in Osborne vs. Olayton 3 R. 137 that “ no appeal will lie from an order, discharging a rule to show cause why an injunction should not be dissolved on the ground that the petition set forth no legal cause for issuing it. That it is an interlocutory order and works no irreparable injury, and if erroneous it may be corrected by appeal from the final judgment.”

We do not think the law, in giving the right of appeal from interlocutory orders, contemplated extending it to original orders granting the conservatory writs of injunction, attachment, etc. The indemnity which the law provides for defendants in these cases against damage and injury is supposed to be sufficient to prevent the injury being “ irreparable,” even if such original conservatory orders can be' considered as «interlocutory.” If the bond given by the plaintiffs in such suits isruffc good and sufficient to indemnify the defendant against any loss and injury he may sustain, the law provides him a remedy, by motion, to compel the giving of good security. Should the judge wrongfully refuse to grant such order, the party would have the right to appeal from-the order refusing it. Poydras vs. Tusson, 3 La. 443.

We think appeals from “ interlocutory orders” should only be granted when the injury therefrom comes with reasonable certainty under the head of “irreparable;” for such appeals tend greatly to the delay and expense of litigation. If substantial relief from the injury done by the order can be obtained on appeal from the final judgment, the interlocutory order should not be appealed from.

Second — As to the right of appeal from the second order above named, that rescinding, the order to bond the injunction, we think our predecessors have settled that it exists, though if discussed as a new question it would be, we think, very questionable. 12 An. 455; 3 R. 102; 11 R. 452.

The effect of the order rescinding the previous order to bond is the same as if the original application to bond had been refused in the first instance. In “ State ex rel. Barthe vs. Judge of Superior District Court,” 28 An. 903, a case involving the precise point, our predecessors heid “ that an appeal will lie from an order refusing to allow the release on bond, under article 307 Code Practice, of an injunction.” See also 28 An. 880 and 889.

It is therefore ordered and decreed that the mandamus and prohibition herein be made peremptory in so far as relates to the order rescinding the order to bond the injunction, and that in other respects they be refused.

Dissenting Opinion.

Egan, J.

I.concurinso much of the opinion and decree of the majority of the court as holds the relator not entitled to an appeal from the order of the district judge granting the injunction complained of, and dissent from so much of the opinion and decree as holds the relator to be entitled to an appeal from the order of the district judge rescinding an order permitting him to dissolve the injunction by giving bond under article 307 of the Code of Practice. All the reasons which exist for denying the right of appeal in the one case, attach with equal or greater force in the other, and are involved in it. If the relator can not appeal from the order granting the injunction, because, if wrongfully issued, he is protected by the bond of the plaintiff, and may obtain relief upon final judgment, or upon appeal from final judgment in the cause, it is difficult to perceive wherein he can not in the same manner obtain relief from the interlocutory order, the effect of which is to reinstate, or to leave .the injunction in force. The general rule has been often announced by this court to be, that where a party may be compensated in money in the same action, the injury is not irreparable, and an appeal will not lie from an interlocutory order, and so I understand the majority of the court to hold on the other branch of this case. See 12 R. 488, 2 An. 321, 4 An. 147, 12 An. 455. In the case of Osborne vs. Clayton, 3 R. 437, it was held that no appeal will lie from an order discharging a rule to show cause why an injunction should not be dissolved on the ground that the petition set forth no legal cause for issuing it; that the order which was interlocutory worked no irreparable injury, and, if erroneous, might be corrected by appeal from the final judgment. The law is correctly stated by Chief Justice Merrick in White vs. Cazenave, 14 An. 57, to be that the law (C. P. 307) “ only confers on the district court ;the discretion to dissolve an injunction on the defendant’s giving bond when the act prohibited is not such as may work an irreparable injury;’ and that when the district judge, through error, embraces as within this article a case not contemplated by it, one where the prohibited act may work an irreparable injury, an appeal must lie (in favor of the plaintiff, riot the defendant in injunction) by the express terms of article 566 of the C. P. The same doctrine was held in Delacroix vs. Villeré, 11 An. 39, and in a number of cases before and since.' In the 14 An. case quoted, the learned judge said: “ The question must be determined by the facts and circumstances of each case,” so that no authority in favor of the relator here can be derived from the cases decided by our predecessors ánd- reported in 28 An., and quoted in the opinion of the majority of the court which were decided upon their own peculiar state of facts. •

Only one of these cases, the State ex rel. Barthe vs. Judge of the Superior District Court, p. 903, has any similitude to that now under consideration, and the opinion, which is very short and unsatisfactory, gives evidence of hasty preparation, as it is evidently based upon the erroneous belief of the judge who rendered it, that “it has frequently been held that an appeal will lie from an' order refusing to allow the release on bond under article 307' of the Code of Practice,” and as further stated in the opinion that “ the relator had an absolute right to an appeal from the judgment complained of, notwithstanding the terms of the article of the Code of Practice, and the decisions of able judges in the past hold the right of appeal from interlocutory orders to be very far from absolute, and make even the exercise of the legal discretion to grant an appeal from such orders, depend upon the particular facts of each case, while the'current of authority and the reasons for it are against the absolute right. Indeed, the cases are exceptional when it is allowed.

The judge has not favored us with any reference to the cases in which it has been so “ frequently-held,” and neither ourselves nor our learned brother who prepared the opinion of the majority of the court in the case-at bar have been able to find them The only other case in the same volume which bears at all upon the questions involved in the present case is reported on page 889, 28 An. So far from being in any degree favorable to the relator it only supports the views expressed in this opinion and those announced in the older cases quoted in it to the effect that this court may, at the instance of the plaintiff in injunction, compel an appeal from an order of the district judge dissolving an injunction on bond. The case was an injunction against an order of seizure and sale. The injunction was dissolved upon the bond of the seizing creditor, and the judge below having refused the plaintiff in injunction an appeal from the order of dissolution was compelled by this court to grant it. The effect of the dissolution would otherwise have been the alienation under the writ of the property seized. The decision was right.

In the fourteenth Annual case before cited, the Chief Justice was applying the principles announced by him to the right of the plaintiff in injunction to appeal from an order dissolving on bond, and went so far as to say that “ in order to test the plaintiff’s right to appeal, we are forced to consider whether the eourt erred in granting the order. If it did err, an appeal lies by the very terms of articles 307 and 566, C. R. If it did not err the appeal mast be dismissed.” And again, he says: “In the consideration of the question before us, the allegations of the plaintiff’s petition nmst be taken as true,” a proposition about which there can be no question and one which is recognized by the majority of the court in the case at bar in the reasons given for refusing the right of appeal from the order granting the inj unction. Applying this principle to the present case, what are the facts or the allegations of the petition for injunction from the effects of which, pending the cause, the relator seeks relief through an appeal from the refusal of the judge to permit him to continue to do the acts from the doing of which he is enjoined by the simple execution of an obligation to compensate in money for committing 'a nuisance, for as such it is characterized and described in the plaintiff’s petition, which, for the purposes of this inquiry, must be taken as true. In the case of Fuselier vs. Spaulding, 2 An. 773, it was properly held that the burning of a brick kiln near a dwelling, exposing it to danger, and seriously incommoding the occupants and endangering the health of plaintiff’s family, may be enjoined.

In the case of Marion vs. Johnson & Rendall, 22 An. 512, the court held that in determining the question whether acts complained of will work an irreparahle injury to the plaintiff, on the trial of a motion to dissolve an injunction on bond, all the allegations of the petition for injunction must be taken as true, and if the facts set up show trespass on real property, which if continued would change the possession of it, the motion to bond under article 307 will be overruled because an irreparable injury would be done the plaintiff. In that case the plaintiff had appealed from an order permitting the defendants to dissolve the injunction on bond, and the motion to dismiss the appeal was overruled, the order to bond set aside, and the injunction reinstated. The counsel for plaintiffs argued and the Supreme Court thought that by permitting the defendants to release the injunction on bond the district judge had licensed a trespass. The district judge, in the case at bar, had, by the order of "dissolution on bond, in effect licensed a nuisance, as appears by the face of the papers by which the question must be tried. This was evidently done through error and inadvertence, and he very properly sought by the order of rescission to recall the error and reinstate the injunction. Had he failed to do so, the plaintiff in injunction under the authorities cited might, and no doubt would, have appealed, and thus corrected the error first committed by the district judge. It does not, however, follow that the defendant can appeal from the order rescinding the order to bond and reinstating the injunction. I think this order rests upon precisely the same basis in the present case with the order granting the injunction, and that it can not be appealed from. If the facts alleged are untrue and the injunction has been wrongfully sued out he will be permitted and enabled to show it on the trial of the cáse and to obtain such damages as he may meanwhile have suffered (see 12 An. 455); but if, on the contrary, the. injunction was rightfully sued out, which we must assume till the contrary is shown on the trial, he can not be permitted to avoid or suspend its effects either by bond for dissolution or by appeal.

Who can recall or repair with money the effect of a continuing nuisance to the health and comfort of plaintiff, his family, and of the public of whom he is one, if it, indeed, be so as charged in the petition for injunction ; and what is the effect of allowing an appeal in this case to the party enjoined, if it be not to permit him to continue to commit and keep up the nuisance complained of during the pendency of appeal, however long.

In Jure vs. First Municipality, 2 An. 322, the absolute right of appeal was denied even to the plaintiff, and we may paraphrase in this case the language of Judge Slidell in that by saying that the very object of the injunction would be defeated if the relator were premitted to suspend its operation by an appeal.

It seems to me that article 307 of the Code of Practice was provided for no such purpose or case, and that we are compelled to look into the facts of the particular case in order to determine whether or not the right to bond and consequently the right to appeal exists. I think the one depends upon the other and that neither exists in the present case. It may not be amiss to remark that it is a necessary corollary from the argument and authorities that the right of appeal may well exist in favor of the party enjoining an act alleged to work irreparable injury and not exist in favor of the party committing the act, and so with all the cases of appeal which are to be found in the books with the exception of that in the twenty-eighth Annual, decided by our immediate predecessors, the incorrectness of which has been already discussed.

This case is different even from an appeal from a refusal to order the release on bond, for in that case the injunction would remain operative and the nuisance could not be continued during the pendency of the appeal, while in the case at bar, which is an application to compel the granting of appeal from an order rescinding an order allowing the defendant to release the injunction on bond, the effect of granting the appeal necessarily, is to continue the existence of the nuisance pending appeal. This effect can not be remedied or recalled. The consequences to the plaintiff and the public might be too serious; and, however little disposed to restrict the right of appeal, I do not think the law gives it, and I can not consent to give it in tliis class of eases.

Eor these reasons I dissent from the conclusions of a majority of the court.