author: Watkins, J.

text:
    No. 11,029.
    Francis M. Pavey vs. I. H. Stauffer.
    1. Notwithstanding a negotiable promissory note may be executed and made payable at a future date to the order of the payee, only as collateral security for a running account of the maker with the payee, the fact of it having such future and contingent consideration does not make same liable to equities between said parties in case the payee shall have assigned same to another holder for value before maturity.
    2. It can not affect the negotiability of a note that its consideration is to be hereafter realized, or that, from some contingency, it may never be enjoyed. Any one having sufficient confidence in another to give his written obligation for something to be given or enjoyed hereafter is at liberty to do so, and the maker cannot censure any future holder for having purchased it; for it was the faith of the maker in the payee that he would execute his promise and allow no obstacles to defeat it that created the note and gave currency to it.
    8. A transfer before maturity of a piece of commercial paper, not endorsed at date of transfer, acquires an equitable but not a legal title thereto; and the mbsequent actual endorsement thereof before maturity does not operate the exclusion of equities between the maker and payee, of which the transferee has had notice in the meantime.
    APPEAL from the Civil District Court for the Parish of Orleans. Monroe, J.

      Henry L> Lazarus for Plaintiff and Appellant.

      Walter D. Denégre for Defendant and Appellee:
    When a promissory note has been delivered in pledge to a third innocent party for value, and before maturity, and without notice, the pledgee is entitled to retain the pledge notes until payment and to proceed by suit and foreclosure of the mortgage securing them to enforce payment.
    Where notes are made payable to the pledgor, and they are delivered to the pledgee without the pledgor’s endorsement, no claims of equities as between the maker and the payee-pledgor will avail as against the pledgee, if, at the time the notes were delivered to the pledgee, they were delivered as endorsed, or with the intention or promise of endorsement.
    The delivery of the notes with the understanding or intention of endorsing, or agreement to endorse, are the only essential elements; and where delivery has taken place and the intended endorsement omitted, equity looks upon that as done which ought to be done. Hughs vs. Nelson, 29 N. J. Equity, p. 549; Daniel’s Negotiable Instruments, Vol. 1, p. 865.
    If an endorsement is intended, but omitted by mistake or accident, it may afterward be compelled by suit in equity. Randolph on Commercial Paper, Vol. 2, p. 450; Daniel, Vol. 1, Par. 745; Randolph, Vol. 2, p.349.
    If a bill or note is transferred without endorsement, but the transfer is made with a promise to endorse, or the endorsement has been omitted on account of some accident, mistake or fraud, the subsequent endorsement will relate back to the time of the transfer, and will shut off all equities as effectually as if it had been made at the same tiine. Tiedeman on Commercial Paper, Par. 348, p. 410.
    An endorsement at anytime before suit brought, whether before or after maturity, cuts off the right of the maker or acceptor to pleadset-off; for a plea of set-off is not an equity. Daniel, Vol. 2,p. 453; Tiedemann, 348,p. 410.
    Under the Louisiana law, especially where an unendorsed note is delivered with a written act of pledge, such pledge or pawn so made, without further formalities, shall be valid as well against third persons as against the pledgors thereof, if made in good faith. C. C., Art. 3158; Jules Ducasse vs. J. C. Keyser and Hugh McKenna, 28 An. 419.
   The opinion of the court was delivered by

Watkins, J.

The object of this action is the recovery of possession of two promissory notes, in capital aggregating about $6000, which were executed by the petitioner to the order of J. B. Lallande, payable at a future date, and presently in the possession of the defendant.

Petitioner’s averment is that J. B. Lallande was, at the time of their execution, his factor and commission merchant, and they were furnished to him as collateral security for his current and running account.

That they were discounted and the proceeds thereof placed to his credit. That from time to time during the cotton season he made shipments of cotton to Lallande, and when some was sold the proceeds were placed to his credit on open account, just as the proceeds of the notes had been previously. That against these assets in the hands of Lallande, he drew drafts and orders from time to time as suited his convenience and the wants of his business as planter and country merchant.

His further claim is that subsequently Lallande failed in business and made a cession and surrender to his creditors, and that at the time there was upon his commercial books credit in his favor to the amount of $4992.28, and that consequently the notes were only bound to him for the difference between that sum and their face value, to-wit, $1492.47; and that upon the payment of that sum he is entitled to the restitution and surrender thereof.

He further alleges that -the defendant received said notes from Lallande as a pledge, or collateral security for his indebtedness, but without right or authority so to do, and without petitioner’s knowledge or consent. That by virtue of said pretended pledge defendant acquired no right or title whatever to said notes, they being petitioner’s property, and that he was entitled to possession of the same upon payment of the Manee due, which sum he tendered and offered to pay upon the surrender thereof to him. That the defendant’s pretended acquisition of said notes was mala fide, and that this appears by asimple inspection of the notes and endorsements thereon.

The salient facts of this case are in accord with the foregoing averments, except in one or two important particulars. The exceptions are: (1) That on the notes and their endorsement there is no evidence of mala fides on the part of the defendant, and no proof of it furnished by the record; and (2) defendant’s title is evidenced by a written act of pledge signed by Lallande, on the 25th of March, 1889, the maturity of the notes having been previously extended by the plaintiff to the 25th of February, and they are consequently not due at the time.

The proof discloses that Lallande accidentally omitted to endorse his name upon the notes at date of their being pledged to the defendant, but that he, subsequently to his cession and surrender, placed his name upon them, with the knowledge and consent of the defendant, but without that of- the. plaintiff, who remained uninformed of the transaction throughout.

The pertinent recital of the act of pledge is as follows, viz.:

“Having executed a promissory note, dated New Orleans, March 25, 1889, for $9000, payable * * * to the order of I. H. Stauffer, on the 16th of February next, 1890, * * * I do hereby pledge, pawn and deliver to said I. H. Stauffer and his assigns, as collateral security for said note, * * * the following,” that is to say the two notes in controversy.. The act then proceeds as follows, viz.: “ In default of payment of my said note, principal and interest, at maturity, I do hereby authorize said I. H. Stauffer, or his assigns, to sell or cause to be sold said collaterals, at public or private sale, * * * and to apply the proceeds * * * to the payment in part or whole of my before mentioned note.”

It is in proof, further, that at the time of the execution of the act of pledge it was within the contemplation of the parties that Lallande should formally endorse the notes, and that he subsequently placed his endorsement upon the notes for the purpose and with the expectation of thereby remedying the defect. The evidence satisfies us, as it satisfied the district judge, that there was neither fraud nor bad faith in the transaction in so far as the defendant, Stauffer, is concerned.

Lallande is not a party to this suit, nor is his syndic a party; yet it is manifest that he had a real and actual interest in the notes to the extent of $1492.47, and his creditors have at this time. This is the plaintiff’s admission.

Under this state of fact, has plaintiff a case entitling him to relief at the defendant’s hands? From the foregoing statement, it is apparent that either the plaintiff must lose $4992.28, or the defendant very nearly that sum, inasmuch as other collaterals enumerated in the act of pledge have comparatively little value.

We have, therefore, a ease in which one of two innocent parties must suffer; and equity requires that the one whose voluntary act put it in the power of another to inflict the injury must sustain the loss, unless there is some precept of positive law to the contrary.

It is certainly true that, upon plaintiff’s own statement, Lallande had the legal possession of the notes, and the right to discount them and convert them into proceeds. It is equally true that when thus discounted, plaintiff had the right to draw, and did draw, against the same. By so doing he evidently placed the notes, collateral for his account though they were, beyond his control, until he covered his drafts by shipments and sales of cotton.

But this the plaintiff has not done.

We need not go further or do more than cite our decision in Bank vs. Cason, 39 An. 865, as governing and controlling the question under consideration. From an examination of that case it appears that the State National Bank was the holder of defendant’s note, by transfer in due form, before maturity. That defendant executed and delivered same to his factors and commission merchants, as collateral security for plantation supplies advanced and to be advanced, and that by shipments of cotton to the latter his supply account was completely paid, and nothing was due by him on account for which the note could longer be held as security.

That at the time of the assignment of the note to the bank it was informed of its consideration — that is to say, that it was only collateral paper — but it was not informed that the defendant’s indebtedness to its transferror had, in point of fact, been, at the time, completely paid.

On this state of facts the opinion proceeds, and the court say:

“ The consideration of the note was a lawful and valuable consideration. ■ * * * As the consideration of the note was a valuable one, plaintiff could not have been affected prejudicially by the knowledge of it. If the consideration be lawful, the knowledge of that consideration can, of itself, have no bearing on the rights of the transferee.
“It is the knowledge of the failure of the consideration, or of seci’et equities between the original parties thereto, that would prevent recovery thereon, as between said parties.
“The right of the plaintiff to recover on the note is the more apparent when we consider that, in this instance, in accordance with the mode in which business is usually conducted between commission merchants and planters, this note, we must infer, was executed for the purpose of being negotiated, that, by means of such negotiation and discount of the note, a sufficient sum might be realized and placed to the credit of the defendant to enable his merchants to furnish the promised advances.”

The court in so deciding followed the precedent laid down in Sadler vs. White, 14 An. 177. In that case the court said:

“Plaintiff received the note before maturity, and before a failure of consideration. Even if it was known to him, taking it that the consideration was future and contingent, and that there might be offsets against it, this would not make him liable to the equities between the defendants and payee.
“ It can not affect the negotiability of a note that its consideration is to be hereafter realized, or that, from some contingency, it may never be enjoyed. Any one having sufficient confidence in another to give his written obligation for something to be given, or enjoyed hereafter, is at liberty to do so, and the maker can not cepsure any future holder for having purchased it and for seeking to enforce it, for it was the faith of the maker in the payer, that he would execute his promise and allow no obstacles to defeat it, that created the note and gave currency to it.”

That opinion is exceedingly clear and well expressed, and applies to this ease with peculiar force. But neither of the two cases cited are as securely founded in equity as the instant one is for the defendant — the account of the plaintiff being paid, in part only, and defendant having acquired the pledged notes in the usual course of business, and without knowledge of their consideration.

On the other and remaining feature of the case little need be said. The absence of any written endorsement on the notes, at time of their being pledged to the defendant, is not of itself a badge of fraud or bad faith on the part of defendant. The act of pledge formally and circumstantially recites a transfer and pledge of them to the defendant. It evidences a complete agreement of the parties to the transfer. They were pledged for a valuable consideration.

The pledge was the controlling and dominant act of the parties, to which the written endorsement, clearly contemplated, was merely subsidiary.

This being the situation, it is not readily perceived what impropriety there was in Lallande supplying the ellipsis by supplementing the evidence of assignment in the act of pledge by the addition of his signature on the notes.

Text writers are agreed that under such facts “ such subsequent endorsement will relate back to the time of the transfer, and will shut off equities as effectually as if it had been inade at the same time.” Tiedeman on Com. Pap., p. 410, citing: Southard vs. Porter, 43 N. H. 380; Haskell vs. Mitchell, 53 Mo. 468; Watkins vs. Maule, 2 Jacob & W. 237; Weeks vs. Medler, 30 Kan. 57.

The same principle is recognized by Randolph. 2 Randolph on Oom. Pap., p. 450, citing: Ex parte Gunning, 13 Ves. 206.

The same principle is recognized by Daniel. 1 Daniel’s Neg. Ins., p. 252, see 260, citing: Hersey vs. Elliott, 67 Mo. 527.

But what makes defendant’s case much stronger is that the assignment of the notes by means of the act of pledge passed an interest in the notes, and created a case not depending upon a mere latent intention to endorse resting upon parol evidence exclusively.

We are of the opinion that the judge of the District Oourt entertained a proper appreciation of both the law and evidence and decided the case correctly.

Judgment affirmed.

On Application por a Rehearing.

This application presents two questions for our consideration — one of fact and the other of law — which, being resolved in favor of the plaintiff, necessitates a change in our decree, and that judgment be pronounced in his favor.

The two propositions are (1) one of fact, whether or not the defendant, Stauffer, was advised of the existence of equities between the plaintiff, Pavey, and Lallande, payee of the two notes in controversy, antecedent to the actual endorsement thereof — said endorsements having been thereon placed before maturity; and (2) one of law, whether, Stauffer having been so advised, the actual endorsement of the notes before maturity, though subsequently to his having been thus advised, relate back to the time of the original transfer, and shut off equities of the'plaintiff as effectually as if it had been made at the time of the equitable assignment — the proof disclosing that an endorsement of the notes was impliedly promised at the time of transfer, and omitted through inadvertence.

(1) A careful examination has satisfied us that the defendant, Stauffer, was advised by the plaintiff, Pavey, of the existence of equities between himself and the payee, Lallande, prior to bhe.actual endorsement of the notes.

The statement of Pavey, as a witness, is direct and positive to that effect; and the real and actual existence of such equities, and for a large amount, is undeniable. This statement is supported by Lallande’s schedule in his insolvency proceedings, and that the object of his visit to New Orleans at the time was to examine those schedules with reference to his notes and account with Lallande. That, upon ascertaining the situation of affairs, and that Stauffer was in possession of his notes, as pledgee, he called upon him and discussed the matter with him fully, disclosing the nature, character and amount of his equities against Lallande.

This statement is not denied by Stauffer, but he declares that he has no recollection of having seen Pavey at all, and, inferentially, no recollection of the conversation that Pavey detailed.

But the facts and circumstances related by Pavey have seriously impressed us with their correctness, and they fully discharge the burden of proof that the law imposes upon him. For, assuming as a fact that Pavey had large offsets against his notes, what more likely than that he should have felt anxiety about the matter, upon ascertaining that Lallande had made a judicial surrender to his creditors; and that he should have looked into the matter at once. Finding that Lallande had pledged his notes to Stauffer, what more likely than that he should have called upon the latter and made a full and complete statement of his claim, and the amount of the credit he was entitled to on the notes he held. Upon the contrary, it would have been most singular and unusual if he had pursued a different course.

In thus deciding we expressly disclaim any intention of placing upon Stauffer the imputation of swearing falsely. On the contrary, it is our deliberate conviction that his recollection of the occurrence that is related by Pavey had failed him; or that, placing full reliance on his pledge and his possession of the notes, he was unmindful of what Pavey did say, and consequently his remembrance of his visit became obscure and doubtful.

In confirmation, however, of the fact that Pavey did visit Stauffer, the record furnishes evidence that, at about the date indicated by Pavey, the two notes were sent by Stauffer to one Levy to be copied; and that the copies showed the notes to have been without endorsement at the time, and upon what other theory can this circumstance be accounted for than that Pavey and Stauffer had had an interview in reference to them, and than Pavey finding them to be without endorsement desired to have copies made, in order to preserve the evidence of that fact for future use.

(2) On the question of law we placed reliance upon the opinions of text writers, and particularly upon that of Mr. Tiedeman in his work on commercial paper, to the effect that a subsequent endorsement will relate back to the time of transfer and shut off equities as effectually as if it had been made at the same time — merely reiterating such authorities as those writers had collected without further comment.

And upon their dicta we said in our opinion that the pledge was the controlling and dominant act of the parties, to which the written endorsement, clearly contemplated, was merely subsidiary. This being the situation it is not easily perceived what impropriety there was in Lallande supplying the ellipsis by supplementing the evidence of assignment in the act of pledge, by the addition of his signature on the notes.”

But the contention of plaintiff’s counsel is, that while this is perfectly true in respect to the mere transfer of the notes, passing title to Stauffer, pledgee, yet it is not true with respect to the effect of such subsequent endorsement — passing such a title as would exclude equities of the maker against the payee.

A careful examination of the authorities has satisfied us that a subsequent endorsement of a piece of commercial paper, after maturity or notice of the existence of offsets of the maker against the payee, transfers the equitable, but not the legal title — not effectuating an anterior, imperfect transaction, br excluding equitable defences that had become available in the meaftwhile.

To this effect is the great weight of authority, English and American ; but we deem it unnecessary to quote from opinions at great length, and will content ourselves by citing a few of the leading eases, by title merely, so as to make them of easy and convenient reference. And first in importance is the case of Whistler vs. Foster, 108 English Common Law Reports, upon which all subsequent opinions have been mainly predicated; Goschen Bank vs. Bingham, 118 N.Y. 349; Lancaster Bank vs. Taylor, 110 Mass. 18; Southard vs. Porter, 43 N. H. 379; Clark vs. Whittaker, 50 N. H. 474; Haskell vs. Mitchell, 52 Mo. 468; Gilbert vs. Sharp, 2 Lansing, 415; Savage vs. King, 17 Maine, 301; Omaha National Bank vs. Walker, 5 Fed. Rep. 399; Sprinning vs. Sullivan, 22 Mich. 491; Minor vs. Berwick, 35 Mich. 491; Trust Company vs. National Bank, 101 U. S. 68; Randolph on Commercial Paper, pp. 449 and 450; Dan. Neg. Ins. (Fourth Edition) Sec. 745, p. 737.

Our conclusion is that our judgment must be reversed, a rehearing granted and a decree rendered in favor of the plaintiff — the cause having been argued orally on this application, no further hearing or delay is necessary.

It is therefore ordered and decreed that our former judgment be set aside, and proceeding to render such judgment as should have been pronounced originally, it is ordered and decreed that the judgment appealed from be annulled and reversed, and that plaintiff have and recover of and from the defendant, I. EL Stauffer, the two notes that are described in his petition, upon making payment to him of the sum of $1492.42; and it is further ordered and decreed that the defendant and appellee pay all costs of both courts.


source: Caselaw Access Project

license: Public Domain

text:
    No. 11,114.
    James T. Hayden, Syndic, vs. Yale & Bowling.
    A citizen of the State of Louisiana, having made a voluntary cession of his property, including real estate in Mississippi, and obtained the judge’s order of acceptance for the benefit of his creditors; and, subsequently thereto, one of the creditors enumerated on his schedule, and domiciled in Louisiana, having instituted an attachment suit in a Mississippi couit and caused the insolvent’s Mississippi property to be seized and advertised for sale under a judgment therein procured; and said creditor having thereafter transferred and assigned his judgment to citizens of the State of Mississippi, with full subrogation; Held, that a court of the State of Louisiana has jurisdiction and authority over its citizens inpersonam to compel them to do justice; and the court of first instance to prevent the aforesaid creditor from defeating the operation and effect of the said assignment and thereby obtaining a preference over domestic creditors, notwithstanding his proceedings were directed against real property situated in Mississippi. Such creditor is within the territorial limits of the jurisdiction of the court and amenable to its process,
    2. Equity acts in personam primarily, and when a person against whom relief is sought is within its jurisdiction, the court may make a decree upon the ground of an act, or contract, or an equity subsisting between the parties, respecting property situated beyond its jurisdiction, or to prevent anything being done abroad, whether the thing forbidden be a conveyance, or other act, in pais, or the institution or prosecution of an action in a foreign tribunal. And, as a necessary corollary of that power, such court may order the person violating the principles of equity to restore the proceeds and avails of the reprobated transaction as justice may require, and in accordance with the principles of the lex loci rei sitos.

    It is the accepted jurisprudence of the States of the Union that, in case of voluntary assignment, a surrender, if valid where made, is valid everywhere, unless repugnant to the policy of the lex loci rei sitas, and in detriment to rights of domestic creditors within that jurisdiction; because such cession or assignment is the exercise of a personal right of the owner to dispose of his property as he chooses.

      APPEAL from the Civil District Court for the Parish of Orleans. Ellis, J.

      Harry H. Hall for Plaintiff and Appellant:
    1. The syndic oí Louisiana insolvents can recover from a Louisiana creditor who is a party to the insolvency proceedings a fund which the latter has secured by attachment suit in Mississippi.
    2. A voluntary assignment valid where made is valid everywhere, provided it be not detrimental to the creditors of the rei sitie, A. and E. Enc., Vol. 8, p. 287; 7 Mich. 86; 36 111. 133; 122 Tel. 551; 36 Red. Rep. 279; 21 How. 126; 2 An. 659.
    3. An involuntary assignment is inoperative beyond the limits of the State by whose laws the transfer is made, but where it does not conflictwith the rei sites, and resident creditors’ rights are not affected, the foreign assignment wiil be respected from comity. A. and E. Enc., Vol. 8, p. 284; Porek, pp. 138, 139; 2 Ben. (in D. Ct.), 53; 5 An. 678.
    4. Where the ri ghts of a domestic creditor are not concerned, the transfer should be given the same force and effect as in the State under whose law it is made. 8th Vol. A. and E. Enc. 284, 287; Rorer, 138; 32 Red. Rep. 280 ; 42 Md. 474; 16 Pick. 25; 71 Md. 514; 36 Am. Rep. 345.
    5. And where all the parties are citizens of the same State, one of them can not secure a preference over his fellow citizen by attaching property in another State. A. and E. Ene., Vol. 3, 615; 19 N. Y. 642; IS N. Y. 362; 10 N. H. 260; 14 N. H. 38; 42 Md. 474; 16 Pick. 335, 25; 11 Gray 37; Whartón, Confl. L. 310, 369, 276, et seq.; 32 Mo. 251, 240; 37 An. 522; 86 Pa. 291.

      Thos. J. Semmes for.Defendants and Appellees:
    1. Lands situated in another State are not affected by a surrender made in this State, and therefore they may be attached by a Louisiana creditor.
    2. At all events the only remedy the Louisiana syndic has is to enjoin the Louisiana creditor from prosecuting his suit. He can not recover from said creditor what he may realize from a sale or transfer of the judgment recovered in the suit. 133 U. S. 107; 131 Mass. 506; 18 Pick. 247; Story, Confl. Laws, Sec. 428; Cockrell vs. Dickens, 3 Moore Prv. Cases, 130.
   The opinion of the court was delivered by

Watkins, J.

Haynes & Rogers, availing themselves of the insolvent laws of this State, as a firm and as individual members thereof, made a cession of their property to their creditors, in due form of law', and same was duly accepted by the proper judge for the benefit, of their creditors.

Amongst other assets surrendered was a tract of valuable land with improvements, situated in Laflore county, State of Mississippi.

Prior to the cession and surrender of said insolvents the present defendants instituted suit against them upon a debt of [some 12300 and obtained the sequestration of 113 barrels of sugar; but by the operation and legal effect of the cession of the defendants, Haynes & Rogers, this seizure was released, the sugars were transferred to the possession of the syndic, and the sequestration suit was cumulated with the insolvency proceedings, where they have since remained undetermined.

The commercial firm of Yale & Bowling is, and was at the time of the cession, a citizen of Louisiana, domiciled in New Orleans, and likewise was James Bowling, one of the members of the copartnership, though Cyrus Yale, the other member, was a citizen of New York; but he died pendente lite and his residence is eliminated from the case as a controvertible question.

Immediately after the cession the defendants instituted suit against Haynes, one of the insolvents, in the Circuit Court of Leflore county, Mississippi, and procured the attachment of the lands that are embraced in and covered by the schedule of the insolvents, and prosecuted that suit to judgment.

Thereunder they caused suitable writ to issue, and said lands to be ordered sold at auction, and same were thereunder sold subsequently, realizing $2000, approximately, as proceeds thereof.

Pending sale proceedings, the defendants, Yale & Bowling, assigned all their rights in and to said judgment to certain citizens of the State of Mississippi, who became the adjudicatees of said property.

This suit has for object a recovery from the defendants, Yale & Bowling, by the syndic, the proceeds and avails of the sale of said real estate, on the ground that they, as Louisiana creditors of the insolvents, were bound by the insolvency proceedings, and had no legal right to lay an attachment on the property of insolvents, though situated in Mississippi, and thus defeat the operation of the insolvency laws of the State of Louisiana thereon.

The averment of plaintiff’s petition is that Yale & Bowling have the proceeds of the sale of said land in their possession “in violation of the laws of this State, and more particularly of the insolvent laws thereof, to which they, individually and as a commercial firm, were subject and amenable. That said writ of attachment issued in violation of the rights of the insolvency aforesaid, and that said judgment was obtained by said Yale & Bowling in violation of said rights; and that said proceedings can not vest in them the right to retain said money; and that petitioner is entitled to recover the same from them,” etc.

On the trial judgment was pronounced in favor of the defendants, and the plaintiff has appealed.

The contention of the defendant’s counsel is that “ if the property attached had been personal property, the syndic, perhaps, might have enjoined Mr. Bowling from prosecuting the (attachment) suit” in the Mississippi court; but as “ lands situated in Mississippi do not pass to the creditors, or become assets of the insolvent in Louisiana, therefore Louisiana creditors are not affected by an attachment of such lands at the instance of a Louisiana creditor.”

Per, contra, the contention of plaintiff’s counsel is that—

“ This is not a suit which seeks to affect real estate, as such, in Mississippi. That it is a suit which seeks to restore to the common fund of the Louisiana insolvency proceedings an asset which had been diverted by a Louisiana creditor, who was passively and actively, theoretically and practically, a party to these proceedings.
“ He is sought to be deprived of the undue advantage he has attempted to take of his co-creditors, because, but for his action, the Louisiana syndic would have been able to realize upon this Mississippi asset and bring its proceeds into the Louisiana courts.
“ And the question therefore is, not whether a Mississippi court will give effect to the insolvent laws of Louisiana to the prejudice of any attaching creditor, but it is whether or not a Louisiana court will permit a citizen of this State, bound by its insolvent laws, and an actual party to the insolvent laws in question, to enforce a Louisiana contract by diverting in a sister State an asset of the insolvent from his co-Louisiana creditors.”

The pertinent provisions of the insolvent laws are :

1. That the debtor making a “voluntary surrender,” or “ cession of his property to his creditors,” “shall annex to his petition his schedule, (which) shall * * contain a statement of all his property, as well movable as immovable, and his rights and actions,” etc. R. S., Sec. 1786.

2. That upon being convinced that the debtor has complied with all the formalities prescribed by law, the judge “ shall endorse on the schedule that the cession of all the property of the insolvent is accepted for the benefit of his creditors.” R. S., Sec. 1789.

3. That “ from and after such cession and acceptance all the prop erty of the insolvent debtor mentioned in the schedule shall be fully vested in his creditors, and the syndic shall take possession of and be entitled to claim and recover all the property, and to administer and sell the same according to law.” R. S., Secs. 1791 and 1794.

In view of the foregoing unambiguous provisions of the insolvent laws, it seems apparent that the insolvent, Haynes, passed to his creditors, through the instrumentality of his cession and its acceptance, an undoubted title to his Mississippi realty, as well as to bis Louisiana estate generally.

Such are the terms of his schedule and the judge’s acceptance of his cession; and, as a matter of law, those provisions are read into the judge’s order of acceptance independently of the terms of the cession and the schedule.

Such a thing as a partial surrender by an insolvent is not contemplated, for the law plainly declares that his schedule shall contain a statement of all his property. Duncan vs. Duncan, 3 M. 232; Schroeder vs. Nicholson, 2 La. 354.

All the debtor’s rights and property pass to his creditors by his surrender, whether placed upon his schedule or not, and the syndic may sue to recover them. 11 La. 531; 12 La. 109; 2 R. 133; 8 R. 123; 9 R. 32; 4 An. 490.

The acceptance of a cession vests the property in the creditors, so as to be no longer liable to seizure or execution. 2 R. 187; 9 R. 219; 3 An. 387; 4 M. 562; 4 An. 490.

Nothing done after acceptance of the cession can affect the creditor’s rights. Bowles vs. Creditors, 4 An. 680.

There is no positive declaration of our law to the effect tha,t the cession shall include property of the debtor situated in another State; but we think the contemplation of the law clearly is that such property should be included in his schedule. But whether such is or is not the law, in this instance the insolvent, Haynes, did surrender his Mississippi property to his creditors generally and it is covered by anp included in the judge’s acceptance.

Accepting this as a proper construction to be placed upon the cession and acceptance of Haynes, the status oí the property in Mississippi is fixed quoad Louisiana creditors at least, and as, in this controversy, no Mississippi creditors are concerned, and none of them are made parties to this suit, it seems clear to our minds that this court has jurisdiction to deal with the parties before it, as law and equity require.

While it is quite true that, with reference to the extraterritorial effect of insolvent laws, there has been a great contrariety of State decision, and particularly with regard to their operation and effect upon real property situated without the territorial limits of the State of such insolvent laws; yet it may be accepted as axiomatic that, in ease of voluntary assignment or surrender, if valid where made it is valid everywhere, unless repugnant to the policy of the lex rei sitie and in detriment to rights of domestic creditors within the latter jurisdiction, because such an assignment is the exercise of a personal right of the owner to dispose of his effects as he chooses.

And further, that where rights of creditors of the domicil are not concerned, the courts of a foreign jurisdiction will permit an assignee or receiver of another jurisdiction to take possession of the insolvent’s property found within the limits of the former and remove same or its avails into the latter in pursuance of the laws thereof. 8 Vol. Am. and Eng. Enc. of Law, pp. 284, 287; and the numerous adjudicated cases eiced in notes.

It is likewise axiomatic that in eases of a conflict between the law of the former and that of the rei sitie, or the custom of the place where the property is situated; the latter will prevail. Horen’s Interstate Law, p. 138.

These principles of law and comity being conceded and accepted, what is the state of the case before us?

At the time of the surrender and acceptance, the Mississippi property was included in the schedule of the insolvent, Haynes, who was and is a citizen of Louisiana, and passed to the creditors of said insolvent by the acceptance of his cession, and among the number to the defendants, Yale & Bowling.

At that time there were no creditors of the insolvent, Haynes, in the State of Mississippi, and no suit or proceeding pending in the courts of that State, in any way affecting his person or property there, or his cession in the State of Louisiana.

Consequently, the effect of the attachment of the property of Haynes, in the State of Mississippi, by Yale & Bowling, subsequently to the cession of Haynes & Rogers in Louisiana, and their assignment of their judgment to citizens of the State of Mississippi, pending sale proceedings thereunder, was to defeat the claims of the syndic of the insolvent thereupon, and put it beyond the control of the Louisiana creditors of the insolvent.

The question propounded by plaintiff’s counsel then recurs: Will a Louisiana court permit a citizen of this State, bound by the insolvent laws and a party to the insolvent proceedings in question, to thus divert a portion of the property of the insolvents that is covered by the cession.

We have been cited to no case that has been decided by this court where this question has been directly involved and adjudicated, and we know of but one — and that is Prager vs. Micos, 36 An. 75— though the discussion is not elaborate nor is the reason for deciding assigned. But there are two adjudications of this court in similar cases, where, to our thinking, this principle has been recognized. One of those cases.is McDowell vs. Read, 3 An. 391, in which occurs this declaration, viz.:

“ In relation to annulling the deeds of trust the judge was of opinion that the situation of the real property out of the jurisdiction of the State was an obstacle to the courts rendering any judgment, where the object was to recover it.
“We think the case referred to by the counsel for the plaintiffs establishes the principle that where a court is called upon to enforce a right it may avail itself of its jurisdiction over the person to do justice relative to a subject matter beyond its territorial jurisdiction, though lands be affected by the decree.
The contract made here between the defendants and Mount is the subject matter upon which the court is called upon to act. Its validity is drawn in question. The responsibility of the trustees to other creditors than those provided for depends upon its legality. Even if the judgment to be rendered should not be efficient in the State where that property is situated, that fact, were it ascertained, we think, would not be sufficient to authorize the court to withhold its action upon the contract.”

The other case is Mussina vs. Ailing, 11 An. 568, in which McDowell vs. Read was quoted and referred to with approval.

“That cause,” say the court, “was remanded to ascertain if the garnishee, resident in New Orleans, had any money in his hands, the proceeds of certain lands and slaves in Mississippi, which, by a contract made in New Orleans, had been conveyed to him in trust, with power to sell, for the benefit of certain preferred creditors of the grantor, who was the defendant in execution, and to the prejudice of the complainant, who resorted to the garnishee process. The court only intimated by its judgment that if the garnishee had money in his hands, the proceeds of this arrangement made in Louisiana, between Louisiana citizens, in violation, or in fraud of her laws, he should not be protected by his own reprobated contract from paying it over to the seizing creditor.” (Our italics.)

In the instant case plaintiffs do not demand the revocation of the judicial sale, made of the Mississippi real estate of Haynes, to the assignees of the judgment of Yale & Bowling, in the courts of Mississippi, against Haynes.

He does not question the jurisdiction or authority of the Mississippi court to render such judgment and to cause such sale to be made. He does not deny the correctness or regularity of those proceedings in any respect. He does not assert that the assignees of said judgment were in any manner subordinated to the control of the Louisiana insolvency proceedings. But he does claim that the Louisiana Court had undoubted jurisdiction over the insolvency of Haynes & Rogers and over the other defendants, as citizens of Louisiana, bound by those insolvency proceedings to compel them to do justice relative to the money in their hands as proceeds of the Mississippi property of Haynes, in fraud of our law and in violation of the rights of the domestic creditors of said insolvent.

It is the act and contract of the defendants with which the court was called upon to deal, and not the property in Mississippi, nor the assignees of Yale & Bowling’s judgment in Mississippi.

The Massachusetts court had this identical question before it in the case of Cole vs. Cunningham, 142 Mass. 47, and it may be instructive to analyze it with reference to the facts of the instant case.

Daniel C. Bird, a citizen of Massachusetts, being unable to meet his bills at maturity, suspended payment, being at the time indebted to Butler, Hayden & Co., citizens of and doing business in the same State. Being informed of their debtor’s suspension, said creditors made an assignment of their claim to a citizen of New York, who at once instituted suit in a court of that State against Bird and garnisheed Claflin & Co., who were indebted to him.

Subsequently regular insolvency proceedings were instituted in a Massachusetts court and assignees were duly appointed for the insolvent estate of Bird, the firm of Butler, Hayden & Co. being present and participating therein.

Thereafter the assignees brought suit in a court of Massachusetts 'against Butler, Hayden & Co., enjoining and restraining them from proceeding to further continue the suits against Bird * * * and from attempting to collect by suit or otherwise * * * any money or other thing on account of the claim against Bird * * * or that they be ordered to transfer to the assignees all their right, title and interest by, or under, or on account of their claim * * * so that the assignees may, as the effect of said order, have full right to receive all money due from Claflin & Co. without any hindrance or interference of Butler, Hayden & Co. therewith.

Upon this state of facts the Massachusetts court held and decided :

In the case at bar it is true that the defendants had made their attachment * * * in New York before there had been any assignment in insolvency in this State actually executed, but this was done with full knowledge on their part that the debtor, Bird, was embarrassed and had suspended payment, and, necessarily, with intent to .avoid the effect of the assignment, so far as the property attached was concerned.
As residents of this State they can not be allowed to this extent to-defeat the operation of the assignment, and thus to obtain a preference over other creditors resident here. They are within the limits of the' jurisdiction of this court and amenable to its process, and should be enjoined from prosecuting a suit, the effect of which, if successful, will be to work a mong and injury to other residents of the State.” (Italics are ours.)

We understand plaintiff to demand that identical relief here, and, for a stronger reason, should his prayer prevail, because Haynes & Rogers had made a cession in'a Louisiana court, the effect whereof was to dissolve a previous suit and sequestration of the defendants and transfer same into the insolvency proceedings; and subsequently thereto they instituted suit in their own names in the State of Mississippi, on the same debt, against one of the insolvents, and caused to be attached property which was included in the insolvent's schedule. Nor was that all. They obtained a judgment in the Mississippi court, recognizing their privilege as attaching creditor’s, and entitling them to be paid from the proceeds of sale of the attached property when made, and issued execution and caused the property to be seized and advertised for sale. Thereupon they made a bona fide and actual transfer of their judgment, with full subrogation, to citizens of the State of Mississippi, to whom the property of Haynes was adjudicated by an indefeasible title.

By this means the property was diverted from the Louisiana insolvency, and its proceeds and avails appropriated exclusively by Yale & Bowling to the detriment and injury of other creditors of the insolvent, and in direct violation of the letter and spirit of Louisiana insolvent laws.

The case of Cole vs. Cunningham was appealed to the Supreme Court, and was therein affirmed. 134 U. S. 107. In treating this question the court made an elaborate summary and analysis of authority, and in the course of their opinion said:

“The jurisdiction of the English Court of Chancery to restrain persons within its territorial limits and under its jurisdiction from doing anything abroad, whether the thing forbidden be a conveyance or other act in pais, or the institution- or prosecution of an action in a foreign court, is well settled.”

So in Penn vs. Lord Baltimore it was held to be a well recognized principle that, as equity acts in personam primarily, the court may, where a person against whom relief is sought is within the jurisdiction, make a decree upon the ground of a contract or any equity subsisting between the parties respecting property situated outside of the jurisdiction. 1 Yes. Sin. 444; 2 Law Cases in Eq. 1806.

In Massie vs. Watts, 6 Cranch, 148, Chief Justice Marshall speaking for the court said of an action which was instituted in Kentucky to compel a conveyance of the legal title to land situated in Ohio:

“This court is of opinion that in a case of fraud, of trust, or of contract, the jurisdiction of a court of chancery is sustainable where-ever the person be found, although lands not within the jurisdiction of that court may be affected by the decree.” (Our italics.)

A similar doctrine is announced in Pennoyervs. Neff, 95 U. S. 714; also in Watkins vs. Holman, 16 Pit. 25, and Corbitt vs. Nutt, 10 Wall. 464.

In Phelps vs. McDonald, 99 U. S. 298, the Superior Court puts the proposition thus clearly and forcibly:

“Where the the necessary parties are before a court of equity it is immaterial that the res of the controversy, whether it be real or personal property, is beyond the territorial jurisdiction of the tribunal. It has the power to compel the defendant to do all things necessary, according to the lex loci rei sitse which he could do voluntarily, to give effect to the decree against him. Without regard to the situation of the subject matter, such courts consider the equities between the parties, and decree in personam according to those equities and enforce obedience to their decrees by process in personam.”

Judge Story announces a similar doctrine:

“ It is now held,” says that author, “ that whenever the parties are resident within a county, the courts of that county have full authority to act upon them personally, with respect to the subject of suits in a foreign county, as the ends of justice may require, and, with that view, to order them to take, or omit to take, any steps and proceedings in any other court of justice, whether in the same county or in any other foreign county.” Story’s Eq. Juris., Secs. 899 and 900.

In Allen vs. Buchanan, 11 Southern Reporter, 777, the Alabama court very forcibly and perspicuously states and approves this doctrine. Our own jurisprudence is likewise in accord with that principle. Edwards vs. Ballard, 14 An. 362.

To the same effect a great many other decisions of the highest courts in different States in the Union might be cited in affirmance of the same principle, but we deem it unnecessary to quote them. On reason and authority we think it clear that the act and contract of the defendants, with relation to the Mississippi property of the insolvent, Haynes, was in clear and direct violation of the insolvent laws of this State, and in derogation of the rights of his domestic creditors, and that this court has undoubted jurisdiction and authority to compel them to surrender and pay over to the plaintiff, as syndic, the money they realized from the transaction.

In our opinion it is immaterial that the defendants only assigned their judgment pending the sale proceedings in Mississippi; the important and distinguishing feature of the transaction was that they made an assignment to citizens of Mississippi, and thus created a barrier that was impassable by the syndic.

The amount realized by the transaction was $2035, and for this sum plaintiff is entitled to judgment.

It is therefore ordered, adjudged and decreed that the judgment appealed from be annulled, avoided and reversed; and it is now ordered and decreed that the plaintiff do have and recover of and from the defendants the sum of $2085, with legal interest from judicial demand, and all costs of both courts.

On Application for Rehearing.

One of the grounds on which counsel rely for a rehearing is, that while it is true that a court having jurisdiction of the parties has the power to make a decree affecting real estate beyond that jurisdiction in so far as such parties are personally concerned, yet that it is equally true that such court, not possessing jurisdiction of the situs of such realty, is powerless to make a decree for the sale or transfer of the same.

This proposition is distinctly announced in our opinion, and is the foundation of it, and the very reason on which we found and held the defendant personally responsible to the syndic of Haynes was that by the assignment they had made of their claim and judgment to citizens of Mississippi the courts of that State had caused his land therein situated to be sold and placed beyond the reach of the syndic — it being the established jurisprudence of the courts of the country that there is only a rule of comity existing among the States whereby the rights of non-residents can be enforced in the absence of resident creditors, or claimants to property situated within the limits of the latter’s State.

They claim that our judgment is excessive in amount, and should be reduced from $2030 to $1600. We think the amendment should be allowed, and it is so ordered, and, as thus amended, our former decree is maintained.

Rehearing refused.


author: McEnery, J.

text:
    No. 11,168.
    Victoria Vicknair, Wife of Felix Lasseigne, vs. Leufroid I. Trosclair.
    A notarial act executed by the wile, in which she sells her paraphernal property, is null and void as against her, if the same was executed under the coercive influence of the husband.
    The wife is a competent witness as to the threats which induced her to sign said act. She is not confined in her attacks on said act to counter letters, interrogatories on facts and articles, but may resort to competent parol testimony to show the real character of the transaction.

      The fact that no threats were heard by the notary, and that the wife was cool and self-possessed when she signed the act, and the testimony of relatives and neighbors that she made no complaint to them is negative in its character, and does not absolutely contradict the wife’s positive testimony as to the threats made by the husband.
    The threats once made are presumed to influence the wife aad cause her silence until an opportunity is presented for the assertion of her right on the property alienated.
    The silence of the wife does not estop her. She is not bound by the doctrine of estoppel as usually understood.
    In the sale of the wife’s property under alleged threats, the fact that she received no benefit from the sale will corroborate to a certain extent her evidence as to the threats.
    The wife may introduce parol testimony to show that the person who eventually acquired her property was in fact the original party for whose benefit the sale was made and is not an innocent third party who acted upon the apparent validity of the transaction.
    Where a party is interposed and a simulated sale is made to him by the wife of her property, and it is then immediately sold to the husband, it is a sale direct from wife to husband, and therefore null and void.
    A party who has a judgment in his favor can not obtain a new trial for the purpose of introducing corroborative evidence.
    APPEAL from the Eighteenth District Court, Parish of Lafourche. Cailluuet, J.

      A. F. Knobloch and L. F. Suthon for Plaintiff and Appellant:
    1. A married woman revendicating her paraphernal property wrongfully sold can resort to every species of evidence; the doctrine of estoppel does hot apply to her. 33 An. 1099; 34 An. 632.
    2. In contracts injurious to the wife’s property interests, the marital influence is presumed. 2 An. 756; 12 An. 852; 14 An. 169.

      3. This presumption, when supported by the wife’s own evidence, is conclusive where there is nothing to rebut it. 23 An. 240.
    4. An absolute nullity can not be the basis of title, and when patent on the public records, can not avail to give a possessor the character of a possessor in good faith. 2Í An. 253; 41 An. 494.

      Clay Knobloch for Defendant and Appellee.
   The opinion of the court was delivered by

McEnery, J.

The plaintiff and her husband, separated in property, owned a plantation in indivisión, the wife’s interest being one-eighth, which she inherited from her father. The husband owned a small plantation, on which he resided. The plantation owned by husband and wife was called u Vicknair.” The “ Lasseigne” plantation, on which plaintiff and husband resided, was just below a plantation owned by defendant, known as the “ Trosclair” tract. Contiguous to the “Vieknair” plantation, the defendant also owned a small tract of land.

In the early part of 1889, Lasseigne, plaintiff’s husband, called on defendant and proposed an exchange of the “Vieknair” tract for the “ Trosclair” tract, so as to place those respective lands in one body. Defendant after some delay finally consented to make the exchange. On the 9th March, the plaintiff sold her one-eighth interest in the Vieknair plantation, to Anatole Naquin, and on the same day, before the same notary and in the presence of the same witnesses, Naquin sold this eighth interest to plaintiff’s husband.

It is fully proved that the sale to Naquin was a pure simulation, made for the purpose of selling and transferring by the wife her eighth interest to her husband, so that he could make the exchange agreed upon between him and defendant.

Both plaintiff’s husband and the defendant owed mortgage debts on their respective properties. We infer from the records, that plaintiff’s one-eighth interest was unaffected by any incumbrance. On 27th March, 1891, the exchange was perfected by plaintiff’s husband selling the “ Vieknair” tract to defendant, and the latter selling to the former the “ Trosclair” tract.

The mortgages on the two properties Avere transferred, the “Trosclair” tract becoming burdened with the mortgage debt of plaintiff’s husband.

In- the sale or the exchange of the two properties there was no money consideration paid. Each plantation was the equivalent of the other.

In April, 1891, when proceedings were instituted to forclose the mortgage on the “ Trosclair” tract, this suit was brought, the plaintiff alleging that the sale from her to-Naquin was an absolute nullity, the sale being simulated and made for the purpose of selling her eighth interest to her husband; that the sale was in fact a direct conveyance by her to her husband. She further avers that she was induced to make said sale to Naquin by coercion of her husband. She prays to be declared the owner of the property described in the petition, and for rent at the rate of $200 per annum, with legal interest from judicial demand.

The defendant sets up title from plaintiff’s husband by public act, passed 27th of March, 1889, and from Naquin to said husband. He alleges that his vendor was in open and notorious possession of said property by titles translative of property, and especially of the undivided eighth claimed by plaintiff in the “Vicknair” tract by reason of the act of sale from Naquin to Lasseigne. He further avers that by the recordation of said several acts of sale he is protected against any alleged simulated sale, if any existed, between plaintiff and her vendee, Naquin, as no counter letter exists or has been recorded ; that he has had no notice or knowledge of the facts alleged in plaintiff’s petition, and that in the absence of a counter letter no evidence of any nature whatever could be introduced against her. There was judgment for the defendant and plaintiff appealed.

There were several bills of exception reserved during the time of the trial.

The plaintiff was sworn as a witness in her behalf. Defendant objected on the grounds (1), that she could not give evidence for or against her husband; (2), that it was an attempt to destroy title to real estate by parol; to establish title in some other person than the one named in the notarial act; to prove by parol agreements relative to real estate antecedent and subsequent to the execution of the authentic act of sale; that it was an attempt to prove by parol matter beyond what is contained in the authentic act; (3), that the defendant being a third person and not being charged with notice or knowledge of the facts set up in plaintiff’s petition, no evidence of any nature whatever could be introduced against him; (4), that conversations between the husband and wife out of the presence of the defendant, who was not a party to the sale or transaction to which they relate, are inadmissible in evidence.

(1) No evidence was sought by her testimony that could in any way affect the interest of the husband. He was not a party to the suit. His wife was a witness in her own behalf, with no interest of the husband at issue which her testimony could affect favorably or adversely.

(2) The wife sued for property which she says was wrongfully sold by her husband. There is no attempt made to contradict the fact of the execution of the authentic acts. Their nullity is urged. It is well settled that in suits of this character the doctrine of estoppel, as usually understood, does not apply to the wife; that she can resort to parol testimony to show the real character of the transaction, and that in attacking authentic acts she is not confined to counter letters and interrogatories on facts and articles. Harrang vs. Blanc, 34 An. 632; Moore & Coleman vs. Bash, 30 An. 1157; Chaffe Bro. & Son vs. Oliver, Admr., 33 An. 1010. The effect of the attack on the authentic act by the wife is that it destroys the title held adversely to her and restores her to her just rights; reinstating title in her is the object sought by the exception in her favor. It springs from the necessity of the case, the wife being under the presumed control and dominion of her husband.

To deny the exception in her favor would be to deny her the benefit of the provisions of the law enacted to protect her interest in preventing imposition upon her.

(3) The defendant being apparently a third party, it is competent to show his real connection with the transaction. This follows from the principle that parol evidence may be resorted to by her to disclose the whole transaction in order to discover its real character.

(4) In her direct testimony the wife testified to the fact of the intimidation. The conversation and circumstances attending it were brought out by defendant on cross-examination. But in a case like the instant one, where the nullity of the contract is demanded because produced by threats and violence, the party in whose favor the contract is made will be affected, although he was ignorant of the threats or violence used to procure the contract. O. C., Art. 1582. The testimony may show that the defendant, although ostensibly a third party, was in fact the beneficiary of the contract.

(5) The conversations of husband and wife in relation to the transaction are the facts to be shown to establish the threat or violence, the undue exercise of marital influence. Usually the wife is the only person by whom they can be proved, as they are not likely to be made in public in the presence of other parties. Their publicity would in all probability destroy their desired effect.

The views above expressed will apply to the second bill reserved to the judge’s ruling to the admissibility of the testimony of the notary who passed the .acts.

The defendant moved for a new trial on the ground of the discovery of new, important and relevant evidence that would estop and bar plaintiff’s suit. The new trial was denied, and we think properly. The defendant had a judgment in his favor and it would have been contrary to all rules and precedents to reopen the case after judgment in order that he might introduce corroborative evidence. It is to be presumed that the judgment was amply supported by the evidence.

Some time elapsed before the wife complained of the sale of her interest in the Vicknair plantation. This is urged as one of the defences to her recovery. If the threat was a fact it is to be presumed that the effect on the wife will continue so long as the husband and wife live together. The wife would naturally be in constant fear of Its repetition and execution if she complained. She was therefore powerless to act until an opportunity presented itself. This was, in this case, when the property was to be sold under the mortgage placed upon it by her husband, when she saw that she would be left without anything, and it may be in such a case the husband became more amiable. But her silence can not prejudice her. McIntosh vs. Smith, 2 An. 756.

The property of the wife was sold through an interposed party to the husband. He thus apparently became owner of the whole tract. He almost immediately exchanged it for other property, on which he placed a mortgage, thus sacrificing his wife’s interest.

She in no way received any benefit from the transaction; the husband was the sole beneficiary.

If a person should, without price or any consideration, dispose of ■all his property to another, some undue influence upon him would at once be suspected, if not presumed. And where a wife disposes of her property, evidently through her husband’s influence in this case, and she receives no benefit from it whatever, why should not some undue marital influence be suspected, and corroborate at least her testimony as to the threats used to coerce her into its disposition or sale ?

The plaintiff says: “ The fact is that my husband came down and had the acts prepared, and came back and told me that I must sign; that is to say, he told me if I did not sign he would leave me. Then I came down to the office, I think it was Mr. Nick Ooulon’s, and signed.”

On cross-examination, she is asked to give the whole conversation with her husband. She answered: “He commenced the conversation. He told me in the morning, I have had an act of sale prepared. I want you to go down and sign it,’ and I asked him what for and for what property, and he told me. I said I did not want to sign, for I had inherited it from my father. He said, I want you to sign, and you must sign.’ I told him I did not want to sign. He then made the threat that if I did not sign he would quit me. Naturally, I told him that I would sign on account of my children. I did not want to be left alone with them.” Such a threat would likely influence any wife.

As stated by Chief Justice Manning, in Moore & Coleman vs. Rush, 30 An. 1150, “ Maternal tenderness was victorious over the instinct of property preservation.”

There is nothing in the record that indicates that her statement is not true. The notary says that she was calm and self-possessed, in no way nervous, when he explained the object and purpose of the transaction, and when she signed the act.

There are witnesses, relatives and neighbors who say she never complained of the sale of her property or referred to the threat of her husband. This is negative testimony. There is no reason why she should have gone to the neighbors and laid bare a wrong inflicted by her husband, and there is less reason why, in the presence of the notary and the witnesses, she would have enacted a scene that would have brought her into unenviable notoriety.

In commenting upon the authorities cited to show that parol testimony may be offered and received in evidence, to establish the true nature and purpose of a transaction which affects the wife’s interest, this court said in Ohaffe vs. Oliver, already cited:

“ Of course these doctrines have their limitations when they involve the rights of innocent third parties, persons who have acted in good faith upon the apparent validity of such transactions.”

The facts disclosed by the record will not justify us in treating the defendant as an innocent third party, who acted in good faith upon the apparent validity of the transaction in which he participated.

The evidence is that the plaintiff’s husband, before the simuiated sale to Naquin, had agreed upon the exchange of the “ Vieknair ” plantation for the “Trosclair” tract. There is no room for doubting that he knew that the sale made to Naquin was a simulated one, and that it was made for the purpose of placing title to the entire property in the name of the husband, in order to be transferred to him.

The deed from plaintiff’s husband to him recites: “Being the property acquired by vendor of the heirs and legal representatives of the late Valley Vieknair and his wife, Adele Vieknair, in the proportion of one-eighth from each of said heirs.” This recital ignores the sale from plaintiff to Naquin, and is a positive declaration that he obtained title to his wife’s one-eighth interest directly from her.

The theory of the district judge was that the preliminary sales were only made for the purpose of putting the property in shape for exchange, a contract which the wife could make with the authorization of the husband. But there was no exchange made by the wife. If she and her husband had exchanged the “Vieknair” plantation for the “Trosclair” place, the wife would have retained her one-eighth interest in that property, for she would ‘have been' getting one-eighth interest in the former for an eighth interest in the latter. But the mode of transferring the properties was of a character to divest the wife’s interest in the “Vieknair” place, before the exchange, and when it was made she received nothing. In fact, the wife made no exchange of her interest, and we can not so view the transaction as to make the wife a party to a contract in which she never entered or participated.

She was a stranger to the exchange made between her husband and the defendant, and we will only look at the contract which she made.

It was null and void for two reasons:

1. The coercive influence of the husband in forcing the sale from her to Naquin.

2. As he was an interposed party, in order that the husband might purchase the wife’s interest, it was in fact a sale from the wife to the husband, not embraced within the exceptions of C. C., Art. 2446, and was in contravention of C. C., Art. 1790.

The improvements made on the “ Vieknair” place by the defendant consist only in the change from a rice to a cane crop. They are not permanent.

The value of the rent of the eighth interest in the “ Vieknair” plantation is worth fifty dollars per annum. The mortgage creditors, not being parties to this suit, the decree rendered herein will not affect them. The right is reserved to them to assert whatever claim they may have on the mortgaged property.

It is therefore ordered, adjudged and decreed that the judgment appealed from be annulled, avoided and reversed, and it is now ordered and decreed that there be judgment in favor of plaintiff against defendant, decreeing her to be the owner of the property-described in the petition, and that she be placed in full possession of the same, and that she do have and recover judgment against said defendant, for the rent of said property at the rate of fifty dollars per annum, with legal interest thereon from judicial demand, and all costs.


author: McEnbry, J.

text:
    No. 11,194.
    J. Ü. Payne, Jr., vs. James & Trager.
    Overflows in the past history of this State have been of frequent occurrence, and they are therefore not of such “ extraordinary nature that could not have been foreseen. ”
    The destruction of the crops by them is not a sufficient cause for the abatement of the rent, but they are unavoidable accidents, within the meaning of Article 2719, Civil Code, and relieve the tenant from repairing damages caused directly by them.
    In a suit for damages the plaintiff must prove his damages with legal certainty. Where the testimony is conflicting we will not disturb the judgment of the lower court without a manifest injustice has been done.
    Before a party can resort to prove what disposition was made of property seized, he must first show that it was legally sold under an order of court, by agreement of the parties, or under a fi, fa., and the loss or destruction of the authority under which it was disposed of.
    APPEAL from the Thirteenth District Court, Parish of West Feliciana. Brame, J.

      Montgomery & Lawrason and Harry H. Hall for Plaintiff and Appellant :
    1. Vague and uncertain allegations of damages, without specification or detail, do not authorize proof. 42 An. 890; 37 An. 492.
    2. 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. C. P. 156; 14 La. 140; 25 An 223.
    3. Stipulations in a contract of lease must be construed with reference to the laws which govern the main contract and. the subject matter. 36 An. 893; 84 IT. S. 58, 68.
    4. The Civil Code of Louisiana, following the civil laws of Rome, Spain and Prance, and differing from the common law, regards a lease for years as a mere transfer of the thing leased, and holds the landlord bound, without express covenant, to keep it in repair* * '* * even when the want of repair or the unfitness is caused by an inevitable accident. 120 IT. S. 707.

      5. Tlie breaking o£ a crevasse in the levees by the waters o£ the Mississippi river is a fortuitous or unforeseen event, within the meaning of the Civil Code of Louisiana, and a tenant is not responsible for damages occasioned by floods from the crevasses. 120 U. S. 707; R. C. C. 2693. 2711, 2721; 40 An. 268 ; 37 An. 532.
    6. Plaintiff is liable for value of property seized by sheriff and not accounted for. 4R. 41; 17 An. 21.

      W. W. Leake, R. G. Wiekliffe and 8. J. Powell for Defendants and Appellees. .
   The opinion of the court was delivered by

McEnbry, J.

The plaintiff sued the defendants in solido for $5000, as damages on a contract of lease for failure to return the leased property in the condition in which it was at the time defendants took possession, under the lease of said property.

Plaintiff alleges a deterioration in the value of said leased prop - erty in the amount above stated, caused by defendants’ violation of their obligation under the lease in not keeping in good order the ditches, buildings, fences, and foi general neglect in permitting the plantation to go to decay.

The defendants answered, averring that the demand of plaintiff was too vague, general and insufficient, and that they could not answer specifically said vague allegations.

They also aver that the plaintiff took possession and control of said leased plantation three years before the expiration of their lease, and leased said plantation to other parties, for whose actions defendants are not responsible; that having collected for each year from said new lessees $600 to $700, the defendants were sued and made to pay the difference of their rent notes and amount collected from the new lessees by plaintiff suing in the United States Court in the name of his brother, C. M. Payne; that if any damage was suffered it was occasioned by the removal of defendants, and during the occupancy of the new lessees under control of plaintiff. They prayed for the dismissal of plaintiff’s demand and a trial by jury.

With this answer they filed a reconventional demand, claiming damages for the malicious prosecution of the suit. On these issues the case was referred to a jury, which resulted in a mistrial. After this trial defendants filed another reconventional demand for $12,-000, for property of the defendants alleged to have been seized by plaintiff under a writ of provisional seizure and unaccounted for by him.

On the second trial, without the intervention of a jury, there was-judgment dismissing plaintiff’s demand, and dismissing defendant’s reeonventional demand, as in case of non-suit.

The plaintiff and defendants appealed from the judgment rejecting their respective demands.

In his petition plaintiff avers that the defendants, “in violation of their obligations to keep said leased premises, including all buildings, fences, ditches, improvements, etc., in good order and repair, during the continuation of said lease, and at the expiration thereof to surrender the same to petitioner in like good condition, order and repair, in which they acknowledged to have received the same, wantonly and with total disregard of plaintiff’s- rights, and of their obligations under their said contract, failed to maintain said premises, buildings, etc., in good order and repair; but, on the contrary, permitted the said plantation to run to waste, and the buildings and improvements to become dilapidated, and the fences to fall, and the ditches to become choked and obliterated.’.’

He further avers, “that on the 15th January, 1886, by notarial act before Guyol, he sold the said plantation subject to said lease, and with full reservation to himself of the right to collect the rent due for his own benefit, and also to sue for the recovery from the said James and Trager of all damages which the said plantation should have sustained while in their possession, according to the terms of the lease; that the priee»paid for said plantation was $15,-650, being the full value thereof in its wasted and dilapidated condition ; had said plantation been in like good order and condition as it was when leased and delivered to said James and Trager, petitioner could readily have sold the same for $20,000.”

The demand of plaintiff is practically the loss he sustained between the difference of the price which he received and that for which he could have sold the plantation, had it been returned to him in good order and condition.

There is no evidence in the record to show that the dilapidated condition of the place influenced the purchasers, or whether they were controlled by the fact that the plantation was subject to overflow from the back part of it, where there was no levee in 1883 and 1884, and the total submersion in 1882, from both front and rear.

The estimated damages are as follows: Ditches, $1000; fencing, $1100; cabins, $600; gin, $250; dwelling, $100; amounting to $3050.

The following clause in the lease is the foundation of plaintiff’s action:

“The said lessees, James and Trager, not only bind themselves in solido for the payment of the aforesaid notes, but also for all other obligations of his contract. The lessees further obligating themselves to keep the herein leased premises, including all buildings, fences, ditches, improvements, etc., in good order and repair, and at the expiration hereof to surrender the same to the said lessor in like condition, good order and repair, in which they acknowledge to receive the same.”

This stipulation is but an affirmance of the provisions of Art. 2719, Civil Code, which requires the lessee to deliver the thing leased in the same state in which it was taken possession of by him, making the necessary allowance for wear and tear, and for unavoidable accidents.

Unavoidable accidents are those which are not attributable to the lessee or to members of his family, or to the sub-lessee. Civil Code 2721.

Article 2716, Civil Code, designates the repairs to be made by the lessee, excepts those which have been occasioned by a hail storm or by any other inevitable accident, and Art. 2717, says “ the expenses of the repairs which unforeseen events or decay may render necessary must be supported by the lessor, though such repairs be of the nature of those which are usually done by the lessee.”

The plaintiff contends that the several overflows, during the lease, which damaged the place, do not relieve the defendant from restoring the place in the condition in which they received it, and rely upon the decisions of this court in Vinson vs. Graves, 16 An. 162; Masson vs. Murray, 21 An. 535; and Jackson vs. Michie, 33 An. 723, in interpreting Art. 2743 of the Civil Code.

This article of the code says: “The tenant of a predial estate can not claim an abatement of the rent, under the plea that during the lease either the whole or a part of his crop has been destroyed by accidents, unless those accidents be of such extraordinary nature that they could not have been foreseen by either of the parties at the time the contract was made; such as the ravages of war extending over a country then at peace, and where no person entertained any apprehension of being exposed to invasion or the like.’

This article applies to an entirely different condition of things, and has no application to the obligations of the lessee to make repairs. A. storm might sweep over the place and destroy the crop and blow down the houses. The tenant could not obtain an abatement of the rent, for the storm was not an accident of an extraordinary nature, and it will not be contended that the lessee would have to rebuild the houses, notwithstanding his obligation to restore the place in the condition in which he received it.

The houses would, in such an event, be destroyed by unavoidable accident, without the fault of the lessee.

Overflows in the past history of this State have been frequent occurrences.

They are not of an “extraordinary nature, that could not have been foreseen, and therefore the destruction of his crop by them is not sufficient cause for the abatement of the rent. But they are unavoidable accidents, brought about without the aid or procurement of the lessee, and as such relieve him from making repairs caused directly by them.

The testimony shows that the leased premises were entirely overflowed in 1882, soon after the lease was executed, partially in 1883, and to a much greater extent in 1884. The damages to the place are attributed entirely to these several overflows, one witness only stating that it was due to the overflow and the bad management of defendants. But he does not specify in what manner this bad management damaged the plantation.

In substance the testimony is as follows: witness for plaintiff, L. P. Laudram, says the plantation in 1881 was in good condition. He remained on the place until August 1882, after the overflow, when ,he left it in bad condition. D. L. Rabalais says the place was in good condition in 1882, but does not know its condition thereafter. Francis M. Pavey says the plantation was in bad condition in 1886, caused by the overflows of 1882, 1883,1884, and also by bad management of defendants. J. M. Rabalais describes the place as greatly deteriorated in 1886.

The barn was converted into a sugar house, damaging it to the amount of $250.

The ditches were neglected during the lease and filled by water in 1882.

It would cost about $500 to put ditches in order. The cabins were greatly damaged by the overflow, and the fences were not damaged. A. B. Couvillon says the place was in good condition in 1882 and in bad condition in 1886. The buildings were in a dilapidated condition and the fences also in a bad condition.

The principal cause of the damage sustained by the place was on account of high water in 1882-1884. There were no repairs made after the overflow. The hands left the place.

The place was overflowed for two months. The current was very strong on back part, but not so strong in front — says broken and loose dirt drifted into the ditches.

In 1883 only a small strip of fencing damaged, but in 1884 damaged a great deal. The water was deep in the cabins, on the back part of the place, damaging bricks and mortar in the chimneys, and washing away the blocks under them, and the negroes left the .place.

Randolph W. Foster says the plantation was in good condition when leased, and the condition of the place bad in 1883, caused by the overflow of 1882. The greater part of the fencing was down, the current having washed the pughes off, the posts up, and undermined the blocks of the houses, in many instances loosening the mortar in the chimneys. The ditches were filled up with debris, trash and logs, and it would have required a great deal of work to clear them out. The place had been abandoned, that is the greater part of it. There were few families on the place.

The gin house was out of repair. The barn was not so much injured, as it was built of stronger and better material, and not being in the current it did not receive the injury done to the other buildings. A statement by this witness is given of the damage to houses, ditches and fences, as stated above.

The plaintiff states that the damage continued from beginning to termination of lease. He does not know at what particular time any damage was done; does not know from personal knowledge that the place was overflowed, and consequently does not know the fact of the overflow, and therefore does not know whether it was damaged by overflow or not.

Witnesses for defendants testify as follows: Robt.'Coca, that the plantation overflowed in 1882 to a depth of three feet, and in 1884 to three-quarters of a foot.

T. P. Harmanson, that the place was worth more in 1882 than in 1886, and the depreciation was caused by the fact of the overflows.

Beverly O. O’Neal says to his knowledge the defendants did no damage to the plantation, but that it was damaged by overflow.

Jacob Sellers says the ditches were bad in 1882. The gin house was old; that the convicts cleared out the ditches in 1882 after the overflow. The fences were washed away by overflow, and the blocks were washed from under the houses. The fences were replaced after overflows. The place was in good fix in 1886. Crops were made and fences all up.

The defendant, Trager, says that in 1882 he spent “twenty odd hundred dollars ” in ditching and cleaning on the place.

He had trees and logs cut out of them. At first convicts did the-ditching, after which he hired colored people to do it. The place-remained under water for two months in 1882. It was not leveed on. side and rear. After the overflow of 1882 he built new fences, and with hired labor “ plugged ” out the ditches. In 1883 the place was-partially overflowed, and in 1884 the overflow came up nearly to the front cut, to within fifty or sixty yards of the residence. The barn was converted into a sugar house by consent of plaintiff. The gin house was in bad condition when be went on the place. He had it propped so that it could be used. Portions of the machinery had to be sent to New Orleans for repairs, and the boiler had to be patched. After the overflow of 1882 he bought lumber and built two cabins, and repaired all the other cabins that required it. Mr. Payne, plaintiff, when he applied for an annulment of the lease, told him to go on and do the best he could. In 1883 there were forty hales of cotton made on the place, and after the overflow of that year there came another in 1884, and he again went to the plaintiff to get relieved from his lease, when he advised him to put on the place one Oouvillon. Oouvillon cultivated the place, and shipped cotton directly for plaintiff’s account for the amount due for rent.

Oouvillon did go on the plantation and was furnished supplies by plaintiff, to whom he shipped cotton: But it will not be necessary to discuss the effect of this change in the management of the plantation.

It does not appear, however, that the plaintiff accepted him as the lessee of the place.

The demand for damages is in globo, the plaintiff claiming the sum of |5000, without specifying in any way the manner in which the defendants have injured him.

The proof that the depreciation in the value of the place was owing to the fault of the defendants is unsatisfactory. The evidence is conflicting, and plaintiff’s witnesses even do not establish the amount of damage with legal certainty.

We do not think that any passive violation of the contract has been proven, and there is an absence of any testimony as to voluntary waste on the part of defendants.

The facts are disputed. The evidence is conflicting in most essential particulars.

We have repeatedly held that on questions of fact found by the lower court that we will not disturb the judgment unless manifestly erroneous. Gilkerson Sloss Commission Oo. vs. Pond & Williams, 44 An. 841.

On the first ground of defendants’ reconventional demand there is no evidence whatever to sustain it.

On the second the testimony shows that the property of defendants was seized for rent. A judgment was rendered in favor of plaintiff, and the proceeds of the sale of a part of the property is credited on the rent note. The balance is unaccounted for.

Plaintiff offered to prove by parol what disposition had been made of the property. The fact that it was legally sold, either by agreement of the parties, by order of court, as perishable property, or under a, ft. fa., ought to have been first shown, and then the loss of the authority under which it was sold, before parol testimony could be received as to the disposition of the property. We think the judgment of non-suit was properly rendered on the reconventional demand.

The facts upon which the reconventional demand is based do not bring it within the provisions of Arts. 3536, 3537, to which the prescription of one year will apply. Judgment affirmed.


author: Breaux, J.

text:
    No. 11,106.
    Mrs. Emma H. Berthelot vs. Mrs. Jacob E. Fitch et al. W. D. Maginnis, Defendant in Rule.
    The administration of the estate of the husband involves that of the community.
    The heir who is the donee of property of the community donated by her father' may collate it in hind during the life of her mother.
    The latter consented to the collation, and claimed her interest in the property collated.
    The title tendered is legal.
    PPEAL from the Civil District Court for the Parish of Orleans. King, J.

      Henry J. Dari for Plaintiff and Appellee.

      W. 8. Benedict and Percy 8. Benedict for Defendant and Appellant.
   The opinion of the court was delivered bj

Breaux, J.

The plaintiff in this rule was plaintiff in an action which was instituted May 21, 1890, having for its object the partition of John Henderson’s estate, and the establishment of certain collations due by Mrs. Anna Lee Henderson, wife of W. D. Maginnis, and Louise Henderson, wife of Jacob E. Pitch.

The widow of the deceased was a party to the suit, also her children, who are the sole heirs at law of the late John Henderson.

A judgment was rendered decreeing a partition of the estate.

Mrs. W. D. Maginnis was ordered to collate in the partition the immovable property of which the following is a description, viz.:

“A portion of ground with the buildings, etc., thereon, situated in the Fourth District of this city, in square bounded by Jackson, Chestnut, Josephine and Coliseum streets, joining the corner of Jackson and Chestnut streets, and measuring sixty feet front on Jackson street by one hundred and twenty in depth between parallel lines; being the property donated to Mrs. Maginnis by act before W. J. Castell, N. P., February 8, 1883, registered in the conveyance office of this parish in Book 778, folio 134.”
“ If Mrs. Maginnis elect to collate in kind, the court ordered a sale of the property on terms of one-third or more cash, at purchaser’s option, and the balance in one and two years’ credit, at 8 per cent. “ interest with usual security clauses.”

Mrs. Maginnis elected to collate in kind.

The plaintiff, Mrs. Berthelot, alone appealed from the judgments.

On appeal, no question relating to the collation of this property was raised, either by the appellant or the appellees.

The judgment was affirmed, with modifications, which have no bearing in the matter of the rule at bar.

After the case had been remanded, in compliance with the judgment, the property collated in kind by Mrs. Maginnis wás offered for sale at public auction and adjudicated to William D. Maginnis. A deed of sale was tendered to the adjudicatee for his signature. He refused to sign, and declined to accept the deed.

Thereupon plaintiff sued out a rule, calling upon him to show cause why he should not sign the deed, accept the title, and pay the price and interest from the day of sale.

The grounds of refusal to accept the title substantially are:

1. That whatever may have been the jurisdiction of the court to order the sals of the entire property, its authority during the existence of Mrs. Henderson was restricted to one-half, and that as to the other half no collation can take place, it depending upon a condition subsequent — her death.

The proposition is correct, and is supported by Art. 1242 of the Civil Code.

The principle that the collation is to be made by halves to each of their successions, if the donation was made jointly by the father and mother, does not admit of question, and applies as well if the donation be made by the father alone, of property belonging to the community, in which the mother had an equal interest.

But the principle does not apply in this case, and can not be successfully invoked against the validity of the adjudication and of the title tendered.

The husband is the head and master of the community; he administers its effects and disposes of its revenues.

In case of the dissolution of the marriage by his death, the wife’s interest in the community is residuary, and she is not the owner of any specific property, before the debts are paid, whether to third persons or to the succession of her husband.

The administration of the husband’s succession necessarily involves that of the community. Sanson vs. Ripley, 19 L. 239; Succession of McLean, 12 An. 222; Durham vs. Williams, Tutrix, 35 An. 162.

The settlement of the succession and the community being generally inseparable, the court had the authority to order that property delivered by an heir who elects to collate in kind be sold at public auction in order to determine the interests of the succession in the community assets.

The donation of this property of the community was made by the husband.

The wife did not question his right to donate it to their daughter.

The rule that the wife’s interest in the community property is residuary, applies when property is donated in kind.

The collation is an abandonment of all rights under the donation to the succession of the donor and to the community in which the widow surviving has an interest.

If the property had never been donated and had remained as part of the assets of the community, if not divisible in kind, and a sale were advisable to fix the rights of the parties, it would be within the court’s authority to sell the entire property.

Where property is returned, as it was in the case at bar, the court has authority to direct its sale to effect a partition.

The second ground argued by the defendant in rule is that in the absence, as he avers, of notice to Mrs. Henderson of the sale of her interest in the community property, the purchaser acquired no title.

The defendant in this respect, labors under a misapprehension.

Widow Henderson was not only a party to the suit in which the judgment ordering the sale was rendered, but she, in addition, expressly consented to the collation; admitted that it was due for the entire property as alleged in plaintiff’s petition in that case, and claimed in her answer" the benefit of such collations in so far as she is entitled to same.”

In no event, hereafter, can the heirs of widow John Henderson legally claim any part of this property collated. The donee has returned it to the mass of the succession, and it was accepted by all parties concerned. They had the legal right to consent to a sale of this property and to bind the interest of the succession and that of the community in ordering the sale.

The judgment ordering the sale is final and legal and under it a legal title was completed, with the exception of the signature of the vendee to the deed and a compliance of the terms and conditions of the sale to which the vendees have a right.

The judgment appealed from must be amended.

“It orders that said Maginnis do pay the purchase price of said property, thirteen thousand dollars in cash, with 5 per cent, interest thereon from the date of adjudication, the 18th day of June, 1892.”

In this respect it is different from the deed tendered and is erroneous.

It is therefore ordered, adjudged and decreed that the judgment appealed from be amended by adopting the terms and conditions of the deed tendered and of the judgment of partition, to-wit: On terms of one-third or more cash, at purchaser’s option, and the balance in one and two years’ credit at 8 per cent, from the day of sale.

As amended, the judgment is affirmed at appellee’s costs.

The judgment of the District Court is amended to conform with a prior judgment.