text:
    No. 6913.
    J. N. Brown, Administrator, vs. E. A. R. Brown.
    The allegations in a petition that a certain transfer oí property is a simulation, and that it is a donation in disguise, are inconsistent.
    When an actual consideration, no matter how inadequate, has been paidbythe purchaser in an alleged sale, the transaction is not a simulated one.
    The delivery oí immovables, where they are disposed of by public act, is always considered as accompanying the act, whether that act be a sale, or a dation era paiement.

    Even when it is shown that the expressed consideration of a transfer does not exist, the contract can not on that account be invalidated, if the transferee proves that there was another legal, and sufficient consideration.
    APPEAL from the Seventeenth Judicial District Court, parish of Red River. Robertson, Judge ad hoc.

      W. H. Jack, J. F. Pierson, and Edward D. White for plaintiff and appellee.

      L. B. Watkins and Egan & Ogden for defendant and appellant.
   The opinion of the court on the merits was delivered by Spencer, J., and on the application for a'rehearing by Manning, C. J.

Spencer, J.

In August, 1876, the plaintiff, alleging himself administrator, and a forced heir of John W. and Mary H. Brown, deceased, filed this suit against his sister, the defendant, and prays that a certain tract of land on the west side of Red river in-the parish of Red River, in defendant’s possession, be decreed to belong to the successions of said decedents ; that the act of transfer thereof made by John W. Brown to the defendant on February 13,1868, be declared a simulation made in fraud of creditors, “ and a donation in disguise, and null and void.” Defendant, alleging that the plaintiff’s demands were inconsistent, moved that he be required to elect between them. The district judge overruled the motion, on the ground that the action was, in substance, one en declaration de simulation. We think that it is inconsistent to allege that an act is a pure simulation and a donation in disguise. A simulated act is nothing. It is “ vox, et praeterea nihil,” while a disguised donation is a reality, and may be and often is a good and valid contract.

But we think the subsequent proceedings in the case show that both parties limited the contest to the single issue of simulation vel non. The defendant put at issue “the question of simulation alone,” and plaintiff confined his case to that issue, and the value of rents and revenues after the death of John W. Brown, in 1873.

This is a family quarrel, and, as might be expected, there is much contradictory swearing, the family being about equally divided between the contestants. Some of the witnesses, especially the plaintiff and his brother, W. W. Brown, can hardly be said to have testified. They delivered set orations and elaborate arguments, instead of depositions. The protestations of defendant’s counsel,and a record bristling with exceptions to the admissibility of this argumentation, seem to have been unavailing to stop this torrent of declamation. It would be an endless task to attempt a detailed notice of all these objections and exceptions, running through several hundred pages of closely written record. We have gone carefully through it all, and will state the facts as they impress us.

On the thirteenth February, 1868, John W. Brown by authentic act conveyed to his daughter, Elizabeth A. R. Brown, the land in question, for the price and sum, as declared in the act, of $1617, cash in hands paid. The daughter lived in the house on the east side of Red river, with her father and mother, the latter being very infirm and paralyzed. The father after the sale continued to manage and control the place sold on the west side, rented it out to tenants, and collected the rents, and disposed of them about as he pleased. The leases were usually made by him in the name .of his daughter, but until his death in 1873 she seems to have taken no active control, at least no ostensible control. It is shown that at the date of this transfer John W. Brown owed a debt to Chaffe & Brother of some $2000, and another small debt of about $150. There is no pretense that he was then insolvent. In fact, if plaintiff and his witnesses are credible, he was five-fold solvent. In October, 1870, Chaffe & Brother brought suit against Brown and Sherrod for $1050, balance due them, and obtained judgment therefor in January, 1871, against the defendants in solido.

Plaintiff and his brother, W. W. Brown, and his sister, Mrs. Turner, and her husband swear that it was well understood in the family that this transfer was a simulation, and they repeat many conversations of their father to that effect; and J. N. Brown details one which he says took place in the presence of Elizabeth, the defendant. The defendant and her brother, T. C. Brown, and sister, Mrs. Giddens, swear to the verity and reality of the sale, and the defendant flatly denies the plaintiff’s statement as to her ever being present when her father said the sale was simulated.

The evidence shows that the consideration of this transfer was not cash, as declared by the act, but consisted of three notes, two for $400 each, with six or eight years interest thereon, and one for $176. This last note is shown to have been held by plaintiff, J. N. Brown, against his father, who requested him to let him have it for Elizabeth, in order to make up a more ample price for the property. The two notes for $400 each were predicated on a sum of $600, which John W. Brown collected and received in 1860 and 1861, on account of salaries due Elizabeth as a public school teacher. Shortly befoie the transfer he delivered her his said two notes for $400 each, in settlement of this debt. There is no doubt or dispute about the fact that he received and collected this sum of $600, as stated, and that she was at the time sui juris; but her brothers, J. N. and W. W. Brown, argue that when she graduated some years before her father bought her a fine piano, and that this $600 must be considered as a payment for that. That she lived with her father, and was maintained by him like the other children, etc. Per contra, the defendant shows that her services in the household, and her constant attention to her infirm mother were worth far more than her support. Suffice it to say that her father seems to have taken the same view, and gave his notes for an undoubted debt due her. If he saw proper to offset her support by her services he had a right to do.so, and from the evidence we think he acted justly in so doing.

There was then a real and valid consideration for this transfer, to the extent of this $600 and interest, evidenced by these notes. The transaction was, therefore, not a simulation. It may have been intended to defraud creditors. We rather think it was. The plaintiff and his witnesses declare that his purpose was' to put his property out of their reach ; and J. N. Brown, plaintiff, and his brother, W. W. Brown, swear in effect that they counseled and consented to his doing so. It is not clear but that J. N. Brown and W. W. Brown, under these facts, were parties to this transaction, and are estopped from disputing its verity. “ Nemo allegans suam turpitudinem esi audiendus.”

The possession of the vendor after the sale creates, as to third persons, a presumption of simulation, unless the verity of the transaction be shown. C. C. 2480, 1921. That presumption has been rebutted in this case by showing that there was a consideration, perhaps inadequate, yet real and actual.

Plaintiff contends that this was not a sale, but a dation en paiement, and without effect for want of delivery. C. C. 2656.

The reason of this rule is not at first glance very apparent, but we take it to be that a payment is never complete until the thing to be paid is delivered. But the delivery of immovables is always considered as accompanying the public acts by which they are transferred. C. C. 2479.

We are aware that in the case of Shultz vs. Morgan, Chaffe & Bro., intervenors, reported in 27 An. 618, Justice Taliaferro, as the organ of the court, seems to deny the application of this rule to transfers of immovables by authentic act by way of dation en paiement. He says that “ it is of the very essence of the dation en paiement that delivery should be actually made,” and cites as authority 3 M. 226, 269 ; 12 L. 375 ; 3 A. 280, and 20 A. 282.

Article 2656 is as follows : “ The giving in payment differs from the ordinary contract oí sale in this, that the latter is perfect by the mere consent of the parties, even before the delivery, while the giving in payment is made only by delivery.” Justice Taliaferro interpolates the word “actual,” which is not found in 'the text of the'article. What constitutes delivery must be determined by reference to other provisions of the Code. The language of the court in 27 A. would be substantially correct when applied to immovables transferred by private act or to movables ; but we have seen that “the delivery of immovables is always considered as accompanying the public act transferring them, whether that act be a sale or dation en paiement. By reference to the cases cited as authority by the court, to wit: 3 M. 226, 269 ; 12 L. 375, and 20 A. 282, it will be seen that they were all cases relating to movables. The case in 3 A. 280 is not in point. It may be added that it is not very apparent whether the acts in question in the case in 27 A. above referred to were public or sous seign privée. But so far as the dictum of that case is applicable to public acts transferring immovables, whether they be sales or dations en paiement, we can not give it our assent.

Under this rule of article 2179, and in view of the fact that the transferee was a female living with her father, who attended to the leasing of the lands transferred, which lay across Red river, we think it clear that John W. Brown could not, without being a trespasser, have disputed her possession, or denied the delivery. O. C. 2479. If he could not, it follows that the rule of article 2656 requiring delivery in datipns en paiement had been complied with, since that rule applies as well between the parties as others. Moreover, the plaintiffs petition alleges without qualification that the “ said Elizabeth A. R. Brown is in possession of, and claims to be the owner of said lands, 'by virtue of said act of sale, etc.” Besides, the transfer is not attacked in the petition as a dation en paiement inoperative for want of delivery, but as a simulated sale.

The plaintiffs objection that defendant could not prove what was the real consideration of the transfer; that the act declared the considei - ation to be cash, and that it was not competent to show that it was notes ■of the vendor, is not well taken. C. C. 1900. “ If the cause expressed in the contract should be one that does not exist, yet the contract can not be invalidated if the party can show the existence of a true and sufficient consideration.”

When a contract, therefore, is attached on the ground that the expressed consideration does not exist, or that there "was no consideration for it, the party may show other consideration than that expressed in the contract. The court below improperly sustained said objection, and we have given effect to said evidence, which is in the record. Under the view wm have taken it is unnecessary to notice the other bills of exception in the record, as the matters to which they relate do not affect the grounds o£ our decision.

While, therefore, we hold that the transfer by John W. Brown to the defendant was not a simulation, it may have been intended as a fraud on his creditors, or it may have been to a large extent a gratuity to her, and prejudicial to the reserves of his forced heirs. The action of the creditors to annul is doubtless barred, but the forced heirs may have right to proceed against defendant for reduction and collation, in so far as the transfer may have been gratuitous.

It is therefore ordered, adjudged, and decreed that the judgment appealed from be annulled and reversed, and it is now decreed that plaintiff’s demands be rejected at his costs in both courts.

On Rehearing.

Manning, C. J.

Upon a re-examination of the grounds of our opinion, we see no reason to change our decree.

It is therefore ordered that our former decree remain undisturbed.


source: Caselaw Access Project

author: DeBlanc, J.

license: Public Domain

text:
    No. 7074.
    The Jefferson and Lake Pontchartrain Railway Company vs. the City of New Orleans.
    Under the present charter of the city of New Orleans, the city may obtain the dissolution oí an injunction against it, without furnishing the bond and security required oí other litigants by article 307 oí the Code of Practice.
    A defendant in injunction, on complying with the law, may have the injunction sot aside in every ease where its dissolution will not work irreparable injury to the-plaintiff.
    ^PPEAL from the Sixth District Court, parish of Orleans. Rightor,

      Geo. L. Bright for plaintiff and appellant.

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

DeBlanc, J.

The city was enjoined from using and maintaining on the land of the plaintiff, a canal running from North Line Street to Lake Pontchartrain, and from draining into said canal, and over the property of the plaintiff, and from entering upon the land of the plaintiff and from trespassing thereon, and from preventing the plaintiff’s damming said canal so as to prevent the city’s draining therein.

The district court permitted the city to bond the injunction, and dispensed the city from giving security.

From this order the plaintiff appealed.

The right to bond is claimed under article 307, 0. E.,and to bond1 without security, under sec. 33, City Charter. E. S. acts 1870, page 44.

Art. O. P. 307 provides : Whenever the act prohibited by the injunction is not such as may work an irreparable injury to the plaintiff, the court may in their discretion dissolve the same: provided the defendant execute his obligation in favor of the plaintiff, with the surety of one good and solvent person residing within the jurisdiction of the court,, for such sum as the court may determine, according to the nature of the-case, as security that he will deliver the property in dispute in the same state in which it was at the moment of issuing the injunction, and that he will pay besides to the plaintiff all damages he may have sustained ' by this act, if a definitive judgment be rendered against him in the suit-pending.

Two questions are presented for determination : First — Is this a-case in which the Oity can be dispensed from furnishing the bond required by art 307 of the O. P.? Second — Is the act prohibited by the injunction such as may work an irreparable injury?

I.

Plaintiff’s action is a judicial proceeding, in which one of the litigants is the City of New Orleans, and the City’s Charter provides: that it shall be dispensed from furnishing bond or security in all judicial proceedings where — by law — bond and security are required from litigants— The Judge of the lower court properly held that — under the provisions-of its charter, the City could obtain a dissolution of the injunction issued against it, without furnishing bond and security. For the damages which may result from that dissolution, every one of the inhabitants who reside within the limits of this vast corporation is answerable, and when and where all are bound, it would have been mere surplusage to add a separate and individual obligation, to a collective and corporate-responsibility.

II.

Is the act prohibited by the injunction one which may cause am irreparable injury to plaintiff? What is the act complained of? Does it involve a change of any one of the parties’ possession, or a change of their respective positions, as they existed at the date of, and immediately preceding the issuance of the injunction?

Plaintiff alleges that in August 1871 — more than six years ago — the-commissioners of the second drainage district forcibly, wrongfully and illegally entered upon its land, and — then and there — begun to dig a canal, afterwards completed by the city — which extends from North line Street, and through the entire length of said land, to lake Pontehartrain, a distance of 16,459 feet. That, by means of that canal, the waters and •filth of the City have been carried over the property of plaintiff, which— lor this and the other causes it alleges — claims from the City the sum of one hundred thousand dollars, and asks that it be perpetually enjoined from draining into said canal.

Had the court refused to dissolve the injunction, it is manifest that, during the approaching summer and fall, a considerable portion of the City would have suffered from an inevitable accumulation of rain water, the stagnancy of which might have caused material injury and endangered the public health — whilst, so far as plaintiff is concerned, the injury it apprehends is not of an irreparable character, and can hardly be compared to that which might result from the unexpected suspension of a, legitimate or usurped privilege, the exercise of which plaintiff appears to have silently tolerated from 1871 to 1877. Its prolonged tolerance may not amount to a renunciation of its alleged rights, but it justifies the action of the lower Court. The dissolution of the injunction did not — in the least — reduce the extent of plaintiff’s possession, as enjoyed by it at and before the date of the injunction. That dissolution merely reinstated the parties in the position which they had previously occupied; and provisionally continued a state of things abruptly repressed and which — before the repression — had openly existed for upwards of six years. In this there is no error.

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

Mr. Justice Egan took no part in the decision of this case.


author: Manning, C. J.

text:
    No. 6805.
    F. A. Luling vs. Labranche, Tax Collector.
    A planter or mannfactn,ror who keeps such articles of merchandise only as are • needed bv laborers on his plantation, and spIIs them only to those laborers, and not to the general public, is not a retail dealer within the meaning of the revenue act, and hence is not subject to the license, or tax imposed on retail dealers.
    j^PPEAL from the Parish Court of St. Charles. Harper, J.

      Jamen T). Auguntin for plaintiff and appellant.

      H. TV. Ogden, Attorney General, for defendant.
   The opinion of the court was delivered by

Manning, C. J.

The plaintiff was required to pay the State and parish licenses for keeping a retail store, wherein goods, wares, and merchandise were sold. The process sued out here is an injunction -restraining the tax collector from enforcing the payment of the sums demanded for licenses, and is grounded on the alleged fact that the plaintiff is not a retail dealer or storekeeper, in the proper and statutory sense, but keeps such articles of merchandise only as are needed by the labourers on his sugar plantation, and sells them to those labourers alone, and not to the general public.

The proof is, that the plaintiff is not a merchant or ‘storekeeper,’' as these words are used in common parlance, but a planter, and manufacturer, on a large scale, employing over a hundred laborers — that he does not traffic as a merchant, and does not sell to, nor invite the public to buy from him — that he did make the experiment in 1876 of keeping an open and licensed store, but found it prejudicial to his employees, and destructive of order and discipline, and consequently abandoned it— that he has since supplied himself with the wares the labourers usually need, and these are delivered to them when needed, and the cost price with some small per centage added, is charged to the labourer and deducted from his wages, and that no one but the employees on the place are permitted to buy, or do buy.

• On the other hand it may be urged, that selling to any one by retail brings the party thus selling within the meaning of the term, retail dealer, and that at two sessions of the General Assembly there has been a legislative interpretation of the meaning of that designation — first in 1866, when that body deemed necessary a special exemption of planters from paying the license of a retail merchant when they sold exclusively to their employees, (Acts 1866, p. 236) and again in 1868 when that exemption was repealed. Acts 1868, p. 119.

No doubt the first act was intended as a legislative declaration that planters, who sold to none but their employees, were not legitimately included within the designation, ‘ retail dealers’, and the second act was intended to deprive the planters, who thus sold, of the benefit of that declaration. But the question is a judicial one now, that the designation of. a class appears in the revenue act, without any explanatory or qualifying interpretation elsewhere.

The^ordinance of the police jury uses the words ‘each and every trade store, wherein goods, etc. are sold at wholesale and retail’, and the tax collector exacts the license as due from a storekeeper selling general merchandise.

A person whose business or avocation is that of planter or manufacturer, and who keeps in store only such goods and wares as his em-. ployees require, and who sells to them alone and not to the general public and who sells, not as a retail dealer does, exclusively for the profit, but only as an advance to his labourers and an incident to his main business, and to promote its better administration, is not a retail dealer within the meaning of the revenue act, and the tax or license; imposed upon that class of persons by that act is not legally demandable from him.

It is in proof in this case that the plaintiff pays taxes upon an assessment of valuable property, including the sum employed as capital in trade, and under the proof before us in this record, he is not liable to the tax, the payment of which was refused.

The judgment is erroneous, and it is ordered and decreed that it is •reversed, and the injunction is perpetuated at defendant’s costs.


author: Marr, J.

text:
    No. 7080.
    Jules Mayronne, Tutor, et al. vs. Eugene Waggaman et al.
    Before an immovable, of which the widow in community and her minor children are the owners in indivisión, can be legally sold, or mortgaged, it is necessary that a family meeting, legally constituted, shall set forth in its report that the sale, or mortgage, is of absolute necessity, or of evident advantage to the minors, and give its reasons for its determination.
    A family meeting, partly composed of one or more persons who have interests in conflict with those of the minors, is not legally constituted.
    APPEAL from the Sixth District Court, parish of Orleans. Bightor, J.

      Bentich Egan for plaintiff and appellant.

      Alfred Grima for defendants and appellees.
   'The opinion of the court was delivered by

Marr, J.

Eugene Hacker died in April, 1871, intestate, leaving a •widow, Mrs. Agathe Leromain Hacker, and eight children, one of them wife of Numa P. Hacker, and seven minors. The widow was confirmed ■as natural tutrix of the minors, and Numa P. Hacker, their brother-in-law, was appointed under tutor. In April, 1872, about a year after the death of her husband, Widow Hacker, on her petition and prayer to that •effect, was judicially recognized as widow in community, entitled in full ownership to one half and as usufructuary to the other half of the property inventoried in the succession, and was put into possession of the whole. The succession of Hacker .was thus closed.

In June, 1872, Widow Hacker presented a petition in which she stated that the property of the succession consisted of real estate, with the buildings and improvements, some shares of stock in the People’s Bank, and a hardware store, the business of which she had continued. That in order to provide for the means to carry on her business properly for her wants and those of the minors, and for the purpose of paying the debts of the succession, it is necessary that she should mortgage the real estate to the amount of six thousand dollars, aDd sell said shares, but she can not do this without the advice of a family meeting.”

The family meeting was convened, and without assigning any reason for it, declared unanimously that it was “ to the interest of said minors that the shares in the People’s Bank be sold and that the immovable property * * * be mortgaged for the amount of ten 'thousand dollars.”

It does not appear whether the members of this meeting were relations or merely friends of the minors, except that Hamilton N. Gautier, one of them, had married one of the minors, and Numa P. Hacker, the husband of another one of the daughters, in his capacity as under tutor -approved the deliberations. The proceedings were homologated and the . widow was authorized to sell the shares of stock and to mortgage the real estate; but, like the deliberations of the family meeting, this ■order is silent as to the terms or conditions of thp sale and of the mortgage.

The widow, in her own right and 'as natural tutrix of her six minor children, Mrs. Eugenie Hacker, assisted by her husband, Numa P. Hacker, and Mrs. Leocadie Hacker, assisted by her husband, Hamilton N. Gautier, executed a promissory note at one year for 15000, and granted a mortgage in favor of Aimó Gautier to secure the payment, binding themselves jointly and in solido.

Referring to 28 A. 446, it will be seen that in January, 1873, Joseph Duvigneaud was appointed administrator of the succession of Hacker: that in July he filed a statement of debts, and obtained an order to sell the real property at one third cash; balance in one and two years: that Gautier intervened and obtained a modification of the order so as to require the sale to be for cash; and that, on appeal, this court held and decided in April, 1876, that the succession of Hacker was closed by the putting of the widow into possession as owner of one half and usufructuary of the- other half: that the succession was no longer under the jurisdiction of the Second District Oourt; and that the entire proceeding was void.

■ In May, 1876, soon after this decision, Aime Gautier, the mortgagee, ■obtained executory process on the note and mortgage. The execution of the writ was delayed by the opposition of Widow Hacker, then by her ■death, by the death of her daughter, Mrs. Numa P. Hacker, by the alleged refusal of Numa P. Hacker to qualify as natural tutor of his two ■children, minors, and by the marriage of one of the daughters, Malvina Hacker, to Jules Mayronne.

Mayronne qualified as tutor of the minors; and in his capacity and -to authorize and assist his wife, he obtained an injunction, alleging substantially that the mother had no authority to borrow money and to bind them by note and mortgage, and that they received and she received no consideration for the same. They also prayed for damages for the wrongful seizure of the property.

Gautier answered by general denial, and prayed for the dissolution of the inj unction with damages. The judgment appealed from dissolved the injunction with $500 damages, and two per cent additional interest, which latter was remitted.

The whole proceeding in this case is extraordinary. The appraised value of the succession of Hacker was $65,526. When the mortgage was granted by the widow, íd July, 1872, the certificate of mortgages showed that there were no incumbrances on the property, except for the drainage tax; the vendor’s mortgage to secure $2800 represented by two notes, which were exhibited to the notary and parties present, paid, can-celled and defaced ; the recording of two bonds in 1868, the other in 1869, given by Hacker as treasurer of a fire company, and the general mortgage against Mrs. Hacker as tutrix.

The statement in Mrs. Hacker’s petition, that she had continued the hardware business and that at the end of the first year it was necessary to sell the bank stock and to mortgage the real estate of the succession to provide means to carry on her business, ought to have alarmed the family meeting. Instead of refusing to consent to the extraordinary demand of the widow, this meeting was unanimously of opinion that she ought to be allowed, not only to sell the bank stock, but to mortgage all the real property for four thousand dollars more than she had had the courage to ask for in her petition. It is strange that the judge did not unqualifiedly refuse to approve and homologate these proceedings, which seem to have been conducted in utter disregard of the rights and interests of the minors.

When it becomes necessary to call a family meeting, it must be composed of relations of the minor, if there be a sufficient number in the parish, or in an adjoining parish, within thirty miles. In her petition Mrs. Hacker gave the names of seven persons, without reference to their relations to the minors, nor are they in the judge’s order appointing them, nor in any part of the proceedings, as far as wo have discovered, styled “ friends.” It appeared on the trial of this case that one of them was a clerk in the hardware store in which Mrs. Hacker and Gautier were partners. The mortgage shows that Gautier, one of the members, was the brother-in-law of the minors, but, as we shall presently see, he was incompetent by reason of his interest conflicting with that of the minors: R. O. C. 283; and Numa P. Hacker, the under tutor who assisted and who approved the deliberations of the meeting, occupied a position equally disqualifying.

Put into possession as absolute owner of one half and as usufructuary of the other half of property inventoried at more than sixty-five thousand dollars, Mrs. Hacker found it necessary, within about a year after the death of her husband, to ask for a loan of six thousand dollars, on mortgage, and for an order to sell the most available of the personal property, the bank stock, to enable her to carry on properly her hardware business which she had continued without interruption from the death of her husband. Of course, it did not long survive under such management, and was bankrupt within a few months after this temporary relief.

The law declares that the immovables of the minor can not be alienated nor mortgaged, unless, on the representation of the tutor that it is for the interest of the minor, a family meeting shall declare that the sale or mortgage is of absolute necessity, or of evident advantage to the minor. B. C. C. 339. How could any one imagine that it was either absolutely necessary or of evident advantage to these minors that their property should be incumbered to provide their tutrix with means to carry on her mercantile business, which was hastening, under her management, to its ruin ?

In case the family meeting shall consider the sale or mortgage to be advantageous to the minor, “ it shall set forth the reasons of its determination in order that the judge may decide whether he ought to cause it to be homologated, and shall fix the terms of credit on which the property shall be sold, and the other conditions of the sale, if the-case requires it.” B. O. C. 310.

There is not one word in the deliberations of this meeting approximating a reason for its determination, nor as to when or how the stock shall be sold, whether for cash or on credit, whether by public or private sale, -whether with or without notice by publication or otherwise; nor is there any thing said about the stipulations in the mortgage, nor the rate of interest to be paid, nor on what credit the mortgage debt is to be contracted.

Several witnesses were examined on the trial, among them Hamilton N. Gautier, and the book-keeper and other employees of the hardware concern. These witnesses say that the debts of the succession were $20,000; but not one of them could give the name of a single creditor. The style of the business was Hacker & Co., and Numa P. Hacker was a partner with Mrs. Hacker at one time; but it does not appear when he became or when he ceased to be a partner. Hamilton N. Gautier was a partner at the time the mortgage was granted; but whether he and Numa P. Hacker were partners at the same time it does not appear.

Aime Gautier, in whose favor -the mortgage was made, was the father of Hamilton N. Gautier. It is not pretended that he lent Mrs. Hacker §5000. The testimony, very unsatisfactory in this respect, tends to show that he discounted the §5000 note at eight per cent, and that, at different times, he handed to his son the proceeds, §4600, part of it before the execution of the mortgage. Hamilton N. Gautier says the debts of the store, contracted after the death of Hacker, amounted to some thirty to forty thousand dollars. "Whatever money Aimé Gautier advanced, the whole of it was deposited in bank to the credit of the account of Hacker & Co., and it was checked out like any other money belonging to that account. Nothing shows that Mrs. Hacker ever touched or had personally the benefit of a single dollar of this pretended loan, except, as Gautier says, it was carried to her credit on the books of the concern, and though the witnesses were pressed, one and all, they could not give the name of a single creditor of the succession of Eugene Hacker, nor the amount of a single debt of that succession, to which any part of the money was applied. It fully appears that Hamilton N. Gautier was actively managing the business at the time of this pretended loan, as one of the partners; and it is most extraordinary that he could not give •the name of any creditor nor the amount of any debt of the succession paid out of this loan.

In July, 1873, when Duvigneaud, in his capacity as administrator, •presented a statement which he said contained all the debts which he had been able to ascertain at the end of six months after his appointment, the whole consisted of a judgment in favor of the attorney who represented Mrs. Hacker in the early stages of the proceeding up to her confirmation as natural tutrix, say for $876 50, about $120 due to three insurance companies, the taxes for 1871 and 1872, and the costs and expenses of the administration. If the succession was sc largely indebted, how can the silence of the creditors for more than two years after the death of Hacker be accounted for ? This record does not disclose even the name of a creditor, except as stated by Duvigneaud ; and we have seen that Hacker left his property virtually unincumbered.

The whole case'indicates the utter want of consideration for the note and mortgage, so far as the heirs of Eugene Hacker are concerned. As to the minors, the note and mortgage are absolutely void. As to the two major heirs who joined their mother in these contracts, the testimony makes it more than probable that they were deceived and were in error; that the pretended loan was exclusively for the benefit of the partnership of which their husbands were members, debts of the respective communities for which they could not lawfully make themselves liable; but we will not conclude the mortgagee with respect to these major heirs, because he may have rights against them which can be established under proper issues by additional proof.

Mrs. Numa P. Hacker left two children, minors. Their father, natural tutor, did not appear to represent them, and a tutor ad hoc was named by the court to represent them in the executory proceeding.

It seems more than probable, from the mismanagement of the hardware business, that the minors, for whom their mother was tutrix, will have mortgage rights against her succession which will exceed in amount the entire value of her interest in the remnant of the succession, the real estate, and that they would be preferred to the mortgagee, Gautier. Enough appears to warrant the perpetuation of the injunction, and to compel Gautier to proceed via ordinaria to establish his rights, whatever they may be, against the succession of Mrs. Agathe Leromain Hacker, against the succession of Eugenie Hacker, late wife of Numa P. Hacker, and against Mrs. Léocadie Hacker, wife of Hamilton N. Gautier, on the note and mortgage in question.

It is, therefore, ordered, adjudged, and decreed that the judgment •appealed from be annulled, avoided, and reversed ; that the note at twelve months for 15000, dated 29th July, 1872, and the mortgage executed by Mrs. Agathe Leromain Hacker, in her own right, and as natural tutrix of her minor children, and by Mrs. Eugenie Hacker, wife of Numa P. Hacker, authorized and assisted by her husband, and by Mrs. Léo•cadie Hacker, wife of Hamilton N. Gautier, authorized and assisted by her husband, in favor of Aimé Gautier, to secure the payment of said note, passed before Armand Pitot, Jr., notary public, on the thirtieth of July, 1872, be and the same are hereby declared and decreed to be null, void, and of no effect so far .as are concerned the minor heirs of Eugenie Hacker and Agathe Leromain Hacker, for which minors the said Agathe Leromain Hacker acted as natural tutrix in the granting of said mortgage, as to whom and their propelty 'the claim and demand of Aime Gautier are rejected ; that the rights of said Aime Gautier, what•ever they may be, against the successions of Mrs. Agathe Leromain Hacker and the deceased daughter, Mrs. Eugenie Hacker, and against Mrs. Léocadie Hacker, wife of Hamilton N. Gautier, be and the same ¡are hereby reserved; that the injunction herein granted against the executory proceeding by Aime Gautier be and it is hereby reinstated and made perpetual; and that Aime Gautier, appellee, pay all the costs of this proceeding in the district court, and in this court. The claim of the plaintiffs in injunction for damages for the alleged wrongful seizure ■of the mortgaged property is dismissed as in case of nonsuit.


author: Manning, C. J. Egan, J.

text:
    No. 7128.
    The State ex rel. New-Orleans Pacific Railway Company vs. Francis T. Nicholls, Governor, et al.
    The Funding Act oC tho Legislature, approved January 2f, 187i, contemplated in itsi purpose, and embraced in its provisions, only the actual debt o£ the State. It excluded the contingent liability of the State embodied in the bonds loaned to-the Citizens’ Bank, and tho Consolidated Planters’ Association.
    In the interpretation o£ a law the motive o£ the lawmaker, and the meaning and scope of the law, may be sought £or in contemporaneous history, in the discussions attendant on tho progress of the legislation, and in subsequent legislation on the same, or on cognate matters.
    The constitutional amendment limiting the debt of the State to fifteen millions of dollars only restrains the Legislature from increasing the actual, or present-debt of the State beyond that sum. It does not inhibit any increase of the contingent liability of the State.
    Until the actual debt of the State has reached the limit of $15,000,000, it is competent for the Legislature to provide for the issuing of bonds as a loan to such enterprises as fall within its constitutional power, provided that in the act creating tho debt, adequate ways and means are provided for the payment of the current interest, and of the principal when it shall become due.
    The act of tho Legislature of March 11. 1878, authorizing the issue of bonds of the State in aid of the New-Orleans Pacific Railway Company is not repugnant to-the constitutional provision prohibiting aid to a private purpose.
    j^PPEAL from the Fifth District Court, parish of Orleans. Bogers,

      Kennard, Howe & Prentiss, Thomas J. Semmes, John Finney, and Henry C. Miller for relators and appellants.

      H. N. Ogden, Attorney General, for the defendants and appellees.
   The opinion of the court was delivered by

Manning, C. J.

The General Assembly at its last session passed art act authorizing the loan to the relator of the bonds of the State to an-amount not exceeding two millions of dollars, the first issue of which should be for the sum of two hundred and fifty thousand dollars only, and providing for subsequent issues upon certain conditions being complied with. Acts 1878, p. 105.

The Governor, in approving the act, signified his intention to provoke a judicial decision upon the constitutional questions involved, and accordingly refused to sign and issue the bonds, whereupon the relator took this proceeding by mandamus to compel the Governor, the Auditor of Public Accounts, and the Secretary of State, to issue two hundred and fifty thousand dollars of bonds of the State in accordance with, and for the purposes expressed in, the act.

The respondents aver that the act is unconstitutional, in that it violates the amendment of the constitution which limits the State debt to fifteen millions of dollars; and because the constitution prohibits the legislature to contract a debt exceeding one hundred thousand dollars, except in certain specified emergencies, oí which” this is not one, without ■at the same time providing adequate means for the payment of the current, interest, and of the principal when it shall become due; and further because it is an attempt to use the taxing power of the State to aid a private enterprise.

The Funding Act was approved January 24, 1874. Its object and purpose was to reduce the floating and bonded debt of the State, and to •consolidate it by authorizing the issue of bonds, which should be exchanged for all valid outstanding bonds theretofore issued, and for all valid warrants drawn previous to its passage, at the rate of sixty cents in consolidated bonds for one dollar in outstanding bonds and valid warrants. The 13th section enacted, that the entire State debt prior to •the year 1914, shall never be increased beyond fifteen millions of dollars, the intent and object of this reduction and consolidation being to re•strict the whole indebtedness of the State to a sum not exceeding that •sum, and to agree with the holders of the consolidated bonds that this indebtedness shall not be increased beyond that sum during the period mentioned in the act. On the same day an amendment to the constitution was approved, to be thereafter submitted to the people for ratification, declaring that the consolidated bonds, to be issued by authority of, and in conformity to the legislative act of same date, created a valid contract between the State and the holders of them, which the State should in no wise impair; and that whenever the debt of the State shall have been reduced below twenty-five millions of dollars, the constitutional limit shall remain at the lowest point reached, beyond which the public debt shall not thereafter be increased, and that this rule shall continue in force until the debt is reduced to fifteen millions, beyond which it shall not be increased. Acts 1874, pp. 39-43. This amendment has become a part of the constitution by its subsequent ratification by the voters at the polls.

This legislation — the funding bill, and the act proposing the constitutional amendment — followed immediately upon the submission to the General Assembly of the Auditor’s report, dated January 1, 1874, wherein is this statement and information.

“The present market value of the actual debt of the State, funded ■and floating, is about fourteen and a half millions. I have the assurance of large bondholders, at home and in Europe, that if the limit of our debt by constitutional amendment, should be fixed at fifteen millions of • dollars, they would accept a new consolidated bond at its face value, and surrender in exchange their old obligations (bonds of all classes and outstanding warrants) at their market value, say about sixty cents on the dollar. The plan of this funding of the State debt is being prepared in detail, and will be submitted for action at an early day during the present session.”

The sequence of the events, and the conformity of the legislation to the idea of the report, shew that the ‘ plan ’ thus referred to is the Act, shortly afterwards passed.

The same Report states the debt of the State at that time to be,

Bonds outstanding January 1, 1874......................$22,433,800.00

Auditor’s warrants (old)................................. 1,565,702.08

Auditor’s warrants (new)................................ 225,051.22

Certificates of indebtedness............................. 131,785.42

$24,356,338.72

In a tabulated statement appended to the Report, and forming one of the exhibits, the “ total amount of the bonded debt of the State for which the State is actually liable,” is fixed at the figures above set forth, and there are then itemized other bonds for which the State is contingently liable, amounting to $4,803,683.33, which with a sum stated as the ‘ miscellaneous debts’ of the State, make up a sum total of thirty millions of dollars. In exact figures, it is that sum, less eight thousand two hundred and seventeen dollars and seventeen cents.

The funding of that sum at the rate suggested by the Auditor, and adopted by the legislature, will create a consolidated debt of eighteen millions of dollars. The funding of the sum, stated by the Auditor as the actual debt of the State, will create a consolidated debt of a little less than fifteen millions.

It is obvious that the ‘ plan ’ both of the Auditor, and of the legislature, embraced only the latter sum, or in other words, that it excluded the bonds loaned to the Citizens’ Bank and the Consolidated Planters’ Association, which amounted in round numbers to the sum above stated, as debt for which the State was only contingently liable. We have therefore to consider whether the expression in the Act of 1874, which restricts the whole indebtedness of the State to a sum not exceeding fifteen millions of dollars, and the expression in the constitutional amendment, which declares that when the debt has been reduced to that sum, it shall not be -increased beyond it, so control and define the meaning of the legislature in passing the one, and of the people in adopting the other, as to constitute an unqualified inhibition of any increase of the debt of the State, after the whole, both actual and contingent, has reached the prescribed limit.

A rule of statutory construction, the soundness of which is attested by long use, and the frequent and continuing approbation of judicial tribunals, is that the intent of the law-maker is to be ascertained by inquiring what was his motive in legislating — what was the mischief sought to be avoided or remedied, and what the object or good to be attained. Contemporaneous history may be resorted to, and the discussions attendant upon the progress of the legislation through its various stages, as well as the projet of the law, in order to discover the meaning and scope of the law itself. Subsequent legislation also upon the same subject, or upon cognate matters, is useful as furnishing an interpretation of previous words, and in fixing their import.

Now if we separate the expressions referred to from the act, and ignore the general tenour of the law, and disregard, £>r refuse to consider, its history and the circumstances attendant upon, and which provoked its birth, so to speak, there' could be given but one construction of the phraseology of the thirteenth section of the. Funding Act. And that construction is opposed by the history of the legislation, by the intent of its framers as disclosed at every anterior stage of its progress, by the reasons and motives which were assigned as inducements for its adoption, and by arithmetical demonstrations of the basis upon which the consolidated debt was calculated.

It is impossible that the contingent liability of the State, upon the bonds loaned to the Citizens’ and Consolidated Banks, should have entered into the ‘plan’, because funding them with the other liabilities will produce a sum-total, greatly exceeding that fixed by the act and the amendment. It is equally impossible that the State should have contemplated and provided for the compulsory funding of bonds, upon which her liability had not attached, but which must necessarily be contingent for many years after the whole process of funding should have been completed. And we shall advert to this feature further on. In addition to this, we know the exact figures, taken as a basis, upon which new bonds, issued at the rate adopted by the funding bill, will produce the debt-limit, also adopted. You can not reach the end, set in view by the funding legislation, by any other road than that mapped out in the programme of its originators. Diverge from it in search of contingent liabilities at the extremity of one of its by-paths, and you can never reach the end, because you get back into it, burthened with a load which can not be constitutionally put off, and which inexorably stays further progress.

An examination of the action of the bondholders, and of the funding Board, will exhibit a conformity of view as to their understanding of the funding act. This is a summary of the State debt on the first day of the present year, exclusive of the bonds styled ‘not fundable’, as compiled by the present Auditor.

Consolidated debt January 1, 1878 ...........$11,279,780.66

Outstanding old bonds when funded......... 392,280.00

Outstanding general warrants when funded... 113,232.55

$11,785,293.21

and this is the total amount of Consols, after every bond and warrant has been funded, the funding of which was contemplated under the theory we have adopted.

But it is said one of the holders of the bonds loaned to the consolidated Planters Association has not acted on this theory, and we have encouraged others to follow his example. Losassier & Binder have obtained a decree, authorizing the funding at sixty cents on the dollar of three thousand dollars of those bonds. The questions presented in the present case were not considered by us in that case. But suppose all the holders of those bonds should apply to have them funded. The whole amount of them, thus loaned, and outstanding, including those in the Lesassier case, is $506,350.00. Exchange these for consols at the funding rate, and the total debt of the State, exclusive of the loan to the Citizens Bank, is when funded, twelve millions and eighty nine thousand one hundred and three dollars and twenty one cents. ($12,089,103.21)

If the whole of the two millions, contemplated by the Act of 1878, shall be issued, the debt will be below the constitutional limit, unless the figures and tabulated statements of the auditing officers of the government are incorrect.

It is urged upon the part of the respondents that the question, whether the bonds loaned to the property banks are to be considered as a part of the indebtedness of the State, has been already answered adverse to the theory of the relator, in the opinion read by our immediate predecessors in Salomon v. Graham, 23 Annual, 402. But that case was decided in 1871, before the project of funding was conceived — before the ‘plan’, which eliminated these bonds from the debt to be funded, was formed or considered, and of course before that plan was perfected by legislative and constitutional enactment.

The limit then prescribed to the debt was twenty-five millions, and manifestly the word was there used, and was then construed, to include all that could be included in that designation, present or prospective. There had not then been any suggestion or scheme to separate the public debt into two classes, one of which was to be funded, and the other not. The constitutional amendment containing that limitation was not preceded by any act or legislative declaration, shewing that what was meant by the debt of the State was other than its whole indebtedness, however created or arising. The inhibition then was that no future debt should be created that would increase the sum total beyond twenty-five millions. The later inhibition was that no present debt should be funded which would increase the debt, intended to be consolidated, beyond fifteen millions.

So far from, that decision militating against the position of the relator, it goes to confirm the idea, that the later amendment had that in view, and in adopting, as a basis for calculation, the actual debt, to the exclusion of the contingent debt, had in mind the fact that the latter had been judicially construed to be a part of the general debt, and did not provide for it to be funded, because it was contingent.

The Funding Act came under the review of the Supreme Court of the United States in 1875, when the court said ; — “it is contended that the State has deprived itself of the right to issue any bonds at all, except the consolidated bonds created by the Funding Act, to be exchanged for outstanding debts already existing,” and this proposition was not mentioned approvingly, although it was not ruled on, being unnecessary in that case, but in the concluding part of the same opinion, the court say in reference to the disposition to be made of the unissued portion of consols ; — -“it may be objected to this view, that the bondholders of the State may refuse to come in and make the sacrifice required by the act; and in such case, the State ought not to be for ever precluded from making such other disposition of the unissued consolidated bonds as may be beneficial to it, without being injurious to those who have accepted such bonds. If such a state of things should arise, after due time and opportunity shall have been given to test the practicability of carrying out the scheme, it will undoubtedly furnish proper ground for modified legislation, having due regard to the rights already vested.” Board of Liquidation v. McComb, 2 Otto, 531.

Due time has now been given to test the practicability of carrying out the scheme. Four years have passed since the funding bill became a law, and we now know that nearly all the holders of the State’s bonds have not refused to come in, but have consented to the sacrifice, and sufficient time has been given to the holders of the residue of the fund-able bonds and warrants for them to come in, and share the advantages of the scheme. We also know that the holders of the bonds loaned to the Citizens Bank will not come in, since their bonds are not a part of the debt fundable in consols. Shall the State be forever precluded from making any other disposition of the unissued consolidated bonds that may7 be deemed beneficial to it by the legislature ?

There is not wanting legislation evincing an animus to prevent any part of the fundable debt, which shall remain unexchanged for consols, from being redeemed or the interest upon it paid. It would be difficult to devise an enactment, more stringent or 'more comprehensive, than that which deprived any officer of the State of the power to assess, collect, or enforce the payment of any tax for the payment of any of the bonds, or the interest thereon, which were contemplated to be funded by the Act of 1874 — which prohibited to all courts and judges, or any tribunals, to entertain or take-jurisdiction of suits to enforce the payment of such tax — which declared that such tax shall not be recorded by any officer so as to operate a lien, and if recorded, that it should not operate a lien — which abrogated all penalties for the non-payment of such tax, and declared that the bonds of tax collectors should not cover such t.ax,, and if they collected it, neither themselves nor their sureties should be liable to pay it to any person. And in the same act, to ensure the payment of the new consolidated bonds, principal and interest, and to attract the confidence of the old bondholders to them, they were exempted from the provisions of these copious and all embracing prohibitions. Acts 1874, p. 94.

We have before said that controversy of the policy or impolicy, the good or bad faith, of the Funding Act is closed, because of the numerous and grave complications that would arise upon, and from, the opening of that question. Lord Cecil vs. Board of Liquidation, ante 35. We regard the faith of the State as irrevocably pledged to the payment of her consolidated bonds, issued under authority of that act, and to the payment of such other bonds as may be issued under the sanction of the decree we shall make herein. The contract with the holders of these bonds, is one which, in the language of the constitutional amendment, the State can by no means and in no wise impair. This utterance, fortified by judicial sanction, contains the double assurance to the bondholders, that their securities shall not be impaired or imperilled, and to the tax payers, that their burthens shall not be augmented beyond the constitutional limit. Until the actual debt of the State has reached the limit of fifteen millions of dollars, exclusive of the contingent liabilities which were not embraced within the Funding Act, and the constitutional amendment, it is competent for the legislature to provide for the issuing of bonds as a loan to such enterprises as fall within its constitutional power, provided other requirements are complied with, and we shall now proceed to the inquiry whether these requirements have been complied with in the present instance.

Has the legislature complied with the constitutional requirement of providing in the law creating this debt adequate ways and means for the payment of the current interest, and of the principal when it shall have become due. The relator is required by the Act to deposit its own first mortgage bonds with the Auditor, and to pledge them to the State, for the guarantee of the payment of the State bonds which shall be issued, to an amount exceeding by one fourth the amount of the State bonds delivered to the Company. The whole amount of bonds to be issued by the company is restricted to five millions, one half of which will be thus pledged for the redemption of the State bonds, in the event the full issue of the latter authorized by the Act is made, and this restriction is evidently made to prevent the weakening the security which the State has required for her protection. Fifty thousand dollars of the State bonds are to be extinguished annually by the company, commencing five years after the completion of its line to Shreveport, and this annual rate of' extinguishment is to continue until the near approach of the maturity of the State bonds, when they are to be extinguished in such annual proportion as shall ensure the payment and cancellation of the whole of them by their maturity.

It may be that these salutary precautions will not completely ensure the object for which they are made. Human affairs depend upon too many contingencies to enable the wisest individual, or the most prudent, public Body to concert a scheme, which is to be practically worked out in the future, and provide with unerring certainty for the attainment of specific results. The legislature has provided the ‘ adequate means ’ in the constitutional sense.

The third and last objection to the constitutionality of the Act is, that the State has not the right to assume or create a debt, which must eventually be met by the use of her taxing power, in aid of an enterprise of this kind.

The argument is that this enterprise is private, as contradistinguished from public, and hence that the public money cannot be rightfully appropriated to its aid. The discussion of this question was at one time practically useful, as well as theoretically interesting. Nearly all the States, if not quite all, have been at one time or another violently agitated by this controversy, and when the arena of conflict was transferred from the hustings to the courts, each side found ample grounds to fortify it in its opinions. There was rarely an unanimous court in pronouncing a judgment for or against the power, and opinions are yet divided between the disputants as to what should have been the judgment pronounced. But as a practical question, it no longer has any interest. The battle over it has been fought, and has been lost by those who denied the possession of the power. A judge, who took pains to collate the information, says the legislation has been sustained in nineteen out of twenty-one States. Swayne, J. in Talcott’s case, 19 Wall. 666.

It may now be regarded as settled doctrine in this country that, no tax can be legally authorized for a purpose which is private, or to put it in another form, for a purpose which is not public. It is not however quite plain always what is a public purpose, but the great preponderance of judicial judgments is in favor of the competency of a legislature, in the absence of constitutional restraint, to authorize loans-to railway companies, and to provide for their payment by the issue and sale of bonds. But a statute which authorizes the issue of bonds, to be redeemed by taxation, in aid of classes or individuals, or in aid of manufacturing enterprises of individuals.or private corporations is void, because it falls within the meaning of the rule which prohibits aid to a private, as contradistinguished from a public purpose, although the local public might be benefitted thereby in a collateral way. Dillon, Mundo. Corp. 3586-591. Monograph Munic. Bonds, 2 South. Law Rev. 438.

The bonds authorized by the Act of March 11, 1878, fall within the former class, and the provision for issuing them, under the conditions therein imposed, is not repugnant to the constitution. Therefore,

'It is ordered, adjudged, and decreed, that the judgment of the lower court is avoided and reversed, and that the mandamus be made peremptory, ordering the signing of bonds of the State to the' amount of two hundred and fifty thousand dollars, and their delivery, to the relator, upon compliance by the relator with the conditions of the above named Act, and that the respondents pay the costs hereof.

Dissenting Opinions.

Egan, J.

However important the interests to be advanced by the decree in this case, as manifested by legislative action, I am unable to agree with the conclusions arrived at by a majority of the court. In my opinion the fact that the property bank bonds are secured collaterally to their full amount does not make them any less a part of the debt of the State nor their obligation upon the State any less binding. It may be that those securities may prove ample for their redemption, or they may not. In this dajr of wonderful reduction of values, whereby fortunes heretofore deemed large disappear as if by magic, and contrary to all reasonable human-calculation, we are daily taught the instability of all securities. In what situation, let me ask, will the State be placed if to-day we authorize and decree the issuance of two millions of new bonds of the State, and to-morrow, or a few years hence, she is called upon to redeem her solemn unconditional promises to pay the property bank bonds. Wliat barrier and what defense is to be interposed ? Surely not the existence of these new obligations of the State which swell its liabilities beyond the constitutional limit; and if not, then the practical consequences of the violation of its contract and of the constitutional amendment will have to be met by the State amid 'many embarrassments. Should a contest arise between the holders of the consolidated bonds and those of this new issue, notwithstanding- the present decree, what must be its inevitable result? But however much these considerations might induce ns to pause at the possibility of the State and the holders of its obligations being placed in such embarrassing- position, this is not the question now. The sole question is whether the contemplated issue in favor of the relator will be in excess of the limit placed upon the State debt by the constitutional amendment of 1874.

In my opinion the reasoning of the court and its decision in the case of the State ex rel. Salomon & Simpson vs. Graham, Auditor, 23 An. 402, is as applicable to-day as when it was rendered as to what constitutes “the State debt,’’ and is unaffected by the fact that the late amendment has reduced the limit of that debt below that then existing. It was then held that the property bank bonds constituted and must be counted and considered as part of the debt of which they have all the characteristics, form, and obligations. The opinion and decree even of the present bench in the case of Lesassier & Binder vs. the Board of Liquidation is in accordance with the same view. That suit was brought under the provisions of the funding bill upon some of these very property bank bonds, and by our decree we declared them to be debts of the State, possessed of all the qualities and characteristics which entitle them to be funded, and it was not even attempted to be urged as a defense that they were not fundable, for the reasons now urged. In point of fact, we know from current history that the same view is taken by the Funding Board itself since the last quoted decision. If so, then what becomes of the argument derived from the amount of consols provided for by the funding bill and the amount of the State debt as estimated at the time of its adoption ? Whatever the errors in those estimates, the terms of the amendment were made no less absolute, and the interests of those dealing with the State can not be affected by such error in the motive for the self-imposed curb on its power to incur debts. If argument is to be drawn from that source and from the acts and motives of the Legislature and the circumstances which gave birth to and attended the legislation on this subject, why should we shut our eyes to the historic and important fact that in that unhappy period in the history of the State which originated the necessity and led to adoption of the funding scheme many and large issues of bonds were made which were known to be outstanding and included in the estimates of the amount of the State debt which were more than suspected of having been fraudulently or illegally issued, and many of which were contested by the Attorney General and Auditor, and that large classes and amounts of bonds were in the opinion of the Legislature itself, as declared in the supplemental funding bill, proscribed and prohibited from being funded without prior judicial inquiry and sifting of their character and basis. From these facts it is evident that the Legislature expected and had good reason to expect that enough of what was estimated as forming part of the State debt would be rejected on such judicial inquiry to reduce it when funded within the fifteen million limit, or even below it, but which possessing on their face all the characteristics of obligations of the State, and being supported by the form of legislation, are and must continue to be included in all estimates of State liabilities until the contrary is decided.

Again, what was the funding bill but a new contract tendered by the State to its creditors, which they might or might not accept for reasons satisfactory to themselves; as for instance in the case of the holders of the property bank bonds, because they might consider the existing security sufficient for their ultimate redemption to their full amount. That this was a reasonable and probable view of the matter is made the more manifest by the fact that up to this time after the offer and opportunity has remained open for several years, less than twelve millions of the consolidated bonds have been applied for or issued. This then disposes of the argument drawn from the relative inequality of the estimated State debt with the addition of the property bank bonds and the amount of consolidated bonds provided for. But aside from the foregoing considerations, the language of the constitutional amendment placing a limit upon the amount of the State debt is plain and unambiguous, and its letter can not be disregarded under the pretext of pursuing its spirit. C. C. art. 13. The amount of issue was however under legislative control should that provided for be found insufficient.

I can not, therefore, assent to the force of the arguments arrayed in the opinion of the majority of the court drawn from their view of what was the legislative intention in proposing or that of the people in adopting the constitutional amendment. In point of fact, however, it is well known that the relative amount of debt and new issue of bonds provided for was little known or considered by the people at large in adopting the amendment, and that they were readily inclined to place a check in the form of a constitutional amendment upon the spoliations to which • under the forms of law they had been of late so freely subjected. They accepted the amendment according to its plain letter and the evident meaning of its language. Is it then surprising if the large class of foreign and non-resident holders of the State bonds have accepted or -should interpret the funding bill and the constitutional amendment to mean what it says? That “the whole State debt” should not be increased beyond fifteen millions before the time fixed in the amendment ? This view alone seems to me consistent with the preservation of the public faith, upon which the whole credit of the State rests, and which it is all important to keep sacred. I am, however, consoled by the reasoning by which a majority of the court have reached their conclusions, and by the consequence of that reasoning and view of the question, that it manifests careful regard for the public faith and obligations, and only determines that the limit of fifteen millions of State debt, as contemplated by the amendment, has not been reached, and not that it shall be overstepped; and also by the fact that the bonds to be issued to the relator do not and can not participate in the benefits secured to the consolidated bonds issued or to be issued under the funding bill, as they are themselves not fundable.

It has been argued that the State has the power and right to withdraw its offer to fund, which can not be required to remain always open. •Concede that this is so, it is sufficient answer to say that the State has not withdrawn its offer, but on the contrary still continues the functions of the funding board, and makes appropriation for its expenses; and •that so far from the discontinuance of funding, it has gone on since the passage of the act relied on by the relator, and is going on as we write. The fact then still remains that the consolidated bonds are so secured ■and guarded that they should, and no doubt will, with a reviving prosperity, to which it is hoped the project of relator will largely contribute, ■•soon be ranked among the best of public securities. Believing, however, ■as I do and as the court has decided, that the property bank bonds are ■absolute and unconditional, and not, as argued., mere contingent obligations of the State, and the amount of the (it being conceded counting them outstanding) State debt at the time of the passage of the act providing for the issuance of the bonds for the benefit of relator was or would thereby be made in excess of the constitutional limit, I dissent •from the decree in this case.

DeBlano, J. I concur in the dissenting opinion of Mr. Justice Egan.


text:
    No. 6831.
    The State vs. Charles Rolle.
    The law imposing a smaller license tax on proprietors of bars, or drinking saloons, kept on steamboats owned and registered in this State, than on the owners of bars kept on land, does not violate the clause of the constitution prescribing oauality, and uniformity of taxation.
    APPEAL from the Fourth Justice of the Peace, parish of Orleans. Hernandez, J.

      Jas. O. Hgan, Assistant Attorney General, for plaintiff and appellee.

      Frank B. Cretien for defendant.
   The opinion of the court was delivered by

DeBlanc, J.

Defendant has appealed from a judgment condemning liim to pay to the State, as keeper of a bar-room a license of $85 — as a •grocer one of $15. The first mentioned of these licenses — that of $85— is claimed under section ten of act No. 14 of 1872, which reads as follows :

“ From the proprietors of all coffee-houses, bar-rooms, beer-saloons or gardens $85: from the proprietors of all bars kept on steamboats, ■owned and registered in this State $50.”

Defendant resists the payment of the license of 5p85, on the ground that the section of the act of 1872, under which it is levied, discriminates between those who carry on land and those who pursue on water what he considers as being but one and the identical occupation.

In his book on Taxation, Burroughs says : tha&wkey;except in only one of the States — the provisions as to equality and uniformity do not apply to taxes on licenses, whether those provisions be mentioned in the constitution or not, p. 167. The license is granted by the State under its police power: it is a personal privilege — not a contract: the tax paid is not regarded as the consideration which moves the granting of the privilege, which may be revoked, annulled or amended at the pleasure of the Legislature. Burroughs — p. 148, 392, 393.

It is true that, whether pursued on land or on water, the calling itself is the same; but, that in its exercise and results, one is different from the other, there can be no doubt: on water, the bar is entirely under the control of the officers of the boat, they can — according to circumstances — prevent or forbid the keeper from opening it, regulate or order its closing. Their interest is to check intoxication, restrain extravagant drinking and preserve quiet on the boat: on land it is otherwise; every one enters the coffee-house, and — far from restraining — the bar-keeper is generally disposed to encourage the abuse of intoxicating liquors, and often that abuse breeds disorder, violence and crime. Burroughs, 392, 393.

In its form, and in many of its effects, the bar-room on a steamboat is distinct from the bar-room on land, and — as the State has the power of dividing into classes the objects of taxation, the distinction which exists between those bars, justifies the difference made in the price of the licenses. 29 A. 283 ; 30 A.

It is, therefore, ordered, adjudged and decreed that the judgment appealed from is affirmed with costs.

Burroughs on Taxation, page 69.