author: Manning, C. J. Marr, J. DeBlanc, J. Egan, J. Spencer, J.

text:
    No. 6707.
    Lord Cecil et al. vs. the Board of Liquidation.
    Bonds ol the State which are described by the Supplemental Bunding Act oí 1873 as “ questioned and doubtful,” can not be legally funded by the Board of Liquidation until they have boen scrutinized, and declared valid by this court.,
    Although such bonds be negotiable in form, and have passed into the hands of innocent third persons, who have purchased them in open market, before their maturity, and for a valuable consideration, they nevertheless will not be a valid debt of the State, unless their holders prove that they were issued in accordance with. law. The rule of the commercial law in favor of the holders of ordinary negotiable paper, is not applicable to such bonds.

      The bonds of the State issued in favor of the " Boeuf and Crocodile Navigation Company,” were not issued in conformity to law, as obviously appeared from the Act authorizing their issue, printed on the reverse sides of the bonds: and therefore are not binding obligations of the State.
    The act of the Legislature passed in 1877, which gives to the Third District Court of the parish of Orleans, in certain enumerated cases, concurrent jurisdiction with the Fourth, Fifth, and Sixth District Courts of said parish, is not in violation of any provision of the State constitution.
    APPEAL from the Third District Court, parish of Orleans. Monroe, J.

      Clarice, Bayne & Benshaw for plaintiffs.

      B. F. Jonas for intervenors.

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

Manning, C. J.

Lord Eustace Cecil, George Montague Sandford, George Woodhouse Currie, and Sir Philip Rose, as trustees of the Foreign and Colonial Government Trust in England, purchased thirty-eight bonds, of one thousand dollars each, of the State of Louisiana, which had been issued under an act of the General Assembly of this State approved January 3 1870. Upon presenting these bonds to the Board of Liquidation to be funded, they were refused because the bonds were issued in aid of the Boeuf and Crocodile Navigation Company, and all the bonds of that issue had been declared of doubtful validity by the supplemental Funding Act. This act prohibits the Board of Liquidation from funding any bonds mentioned in this liste des proscrits until they have been declared by this court to be legal and valid obligations of this State, and that they were issued in strict conformity to law, and not in violation of the constitution of this State or of the United States, and for a valid consideration. Acts 1875 p. 110. Thereupon the plaintiffs instituted this suit for the purpose of obtaining from this court a decree affirming the legality and validity of the bonds in question.

L. B. Bimse of New York intervened, claiming ownership of .fifteen other bonds of same denomination and issue, alleging a like presentation of his bonds for funding and a like refusal, and praying a like decree. An intervention of this kind seems to be sanctioned by the act, and no objection is made to it.

The defendant answered by a general denial, and a special averment that the bonds held by plaintiffs had none of the characteristics required by the supplemental Funding Act. The answer to the intervention is the same in substance. There was judgment in favor of the plaintiffs and intervenor, and the defendant appeals.

It will be observed that the object of this and similar suits is not to obtain a judgment against the State for the amount of the bonds. The decree we are to render is assimilated to a 'special verdict of a jury, who have been charged to ascertain or find certain facts, i. e. do the bonds possess the requisites, enumerated in the act of 1875, which it is essential they should have in order to justify the Board of liquidation In funding them.

The General Assembly passed an act granting the aid of the State to the Bceuf and Crocodile Navigation Company, by which the Governor was authorized to issue the bonds of the State to the amount of eighty thousand dollars in favor of that company. It empowered the president and secretary of the company to sell or pledge the bonds thus issued in such quantities as they may deem necessary to raise money for the •completion of the work of making the Boeuf and Crocodile navigable. Whether the two things designated by these two words were canals, or bayous, or streamlets, or larger bodies of water nowhere appears- in the act, which provides further that all the rights and privileges of the company are pledged, hypothecated, and mortgaged to the State to secure the payment of the bonds issued in its aid, and the interest that may accrue thereon. Acts 1870 p. 21.

- The bonds have at their head the words, “ State bond in favor of the Boeuf and Crocodile Navigation Company,” and run thus, “ the State of Louisiana is indebted to Henry C. Warmoth or bearer in the sum of one thousand dollars” etc., and bear even date with the act above quoted, and are signed “ H. C. Warmoth, Governor of the State of Louisiana,” and are countersigned by the Secretary of State. It is admitted that the signer of the bonds is also the payee.

The testimony of all the plaintiffs was taken, from which it appears they bought thirty-eight of these bonds in London on the 8th of April 1870, three months after their date, and paid for them £6461 Is. lOd. a sum exceeding that at which they can now fund them in Louisiana con-sols. The intervenor’s testimony is that he paid nine hundred and twenty dollars flat for each of his fifteen bonds, in open market at New York, on the 1st of April of same year. These holders now charge that being purchasers in good faith, before maturity, and for a valuable consideration, in open market, they are protected by the undisputed rule of commercial law which shelters them from all latent equities between the maker and the payee — that they had not to look further than or behind the broad seal of the State, which assured them of the genuineness and legality and validity of the securities'thus purchased.

If this rule of commercial law is applicable without reserve to the bonds of this State, what significance are we to attach to the act of 1875 ? The Funding Act provided that all obligations of the State might be exchanged for consolidated bonds at the rate of sixty cents on the dollar, and constituted a board to liquidate these obligations, and gave to the holder of any valid bond or warrant, in case of its rejection by the board, the right to apply to any proper court for relief. Acts 1874, p. 39. In the following year, the supplemental Funding Act enumerated bonds, amounting to over fourteen millions of dollars, which it declared ‘ questioned and doubtful as to their legality and validity,’ and expressly and in terms prohibited the board from funding any of the bonds on that list until this court had decreed that they were valid obligations, and that they had been issued in conformity to law, and for a valid consideration.

If the holders of these ‘questioned’ bonds, who are purchasers before maturity for a valuable consideration, are entitled to have their bonds funded because they thus purchased them, why should the General Assembly impose upon them the vain and useless formality of obtaining a decree from this court upon any quality of the bonds ? Of what avail is an inquiry touching the validity of a bond, or its issuance in conformity to law, if the fact that it is invalid and that it was not issued in conformity to law, will not affect the rights of the holder ? Clearly this rule of commercial law does not apply here. The State can be sued in her own courts only by her permission, and in the manner and for the purposes indicated by her. The supplemental funding act required parties who resort to an action against her, through the board of liquidation, to establish the good consideration, and valid issue in conformity to law, of the bonds offered for funding, and restricted this court to an ascertainment of the possession of these requisites by those bonds. It is that law therefore that must be our guide, and not the general commercial law, in actions like the present. We have a substantial inquiry to make. The holders of these ‘questioned’ bonds must shew affirmatively that they have all of the requisites recited, in the act of 1875 as necessary to obtain a decree of this court. One of these is that they must be issued in conformity to law. Were these bonds thus issued ?

The act from which they derive their existence reads, “ that the Governor is hereby authorized to issue in favor of the Boeuf and Crocodile Navigation Company, domiciled in the parish of St. Landry, State of Louisiana, the bonds of the State to the amount of eighty thousand dollars.” The bonds were not thus issued. They are payable to H. C. Warmoth or bearer. The act provides that the president and secretary of the company shall have power to sell or pledge the bonds, but neither of these officers is made the payee for the company, but they are signed by the Governor in his official capacity and are payable to him in his individual capacity.

It would be difficult to imagine a case where the parties would be more entitled to equitable relief than this. Their good faith is unquestioned. The English holders purchased for a trust fund. They invested in these bonds, relying upon the good faith of the State, whose seal attested their genuineness, and we are asked, not unreasonably, to assist in upholding that faith and credit. But we are not the law-making department of the State. The policy or impolicy, the good or bad faith, of an enactment such as the Funding bill of 187á is now beyond our inquiry. Too many and too grave complications would now ensue from the opening of that question. But the act of 1875 emanated from the same source, and that Act imposes upon us the duty and the necessity of ascertaining whether any of the bonds enumerated in it are wanting in any of the qualities, essential to entitle them to be funded. We think the bonds of the plaintiffs and intervenors are wanting in one of them. They were not issued in conformity to law. And th'e lack of this quality was patent.

The Act which authorized the issuance of the bonds is printed in full on the reverse of each bond. Each purchaser, when the bond was offered to him, could read for himself the conditions and form prescribed by the act. If a more minute examination was made, he would fail to discover from the terms of the Act what it was that the Legislature of Louisiana was intending to improve. The term ‘ navigation’ would certainly imply that water was the element to be operated on, but there is no indication beyond that. The Act bore on its frontlet unmistakably the warning, caveat emptor.

The judgment from which this appeal was taken was rendered by the Third District Court of this city. It is now contended on behalf of the defendant that the matter in controversy was without the jurisdiction of that court. It derives that jurisdiction from an act of the present year. Acts 1877, p. 218. The Attorney General attacks the constitutionality of that Act.

The Constitution confers upon the General Assembly the power to establish as many District courts in the parish of Orleans as the public interest may require. Until otherwise provided, seven are constituted, and to the third is given exclusive jurisdiction of appeals from, justices of the peace. These seven courts shall also have such further jurisdiction, not inconsistent herewith, as shall be conferred by law. article 83. It is not inconsistent to enlarge the jurisdiction of one of these courts. The third Court must have exclusive jurisdiction of appeals from justices of the peace, but this exclusive jurisdiction of a particular class of cases does not preclude it from having concurrent jurisdiction with other courts of another class. The division or assignment of jurisdiction made in the constitution must remain until otherwise provided, and the use of this phrase implies that another assignment may be made. The legislature has given to the third Court original concurrent jurisdiction with the fourth, fifth, and sixth, in certain cases, and this is one of them.

It is therefore ordered, adjudged, and decreed that the judgment of the lower court is avoided and reversed, and it is now decreed that the bonds held by the plaintiffs and intervenor are not valid obligations of the State of Louisiana, and that they were not issued in conformity to law. It is further ordered that these parties pay the costs of both courts.

Rehearing refused.

Concurring Opinion.

Marr, J.

There are certain considerations affecting the validity of the bonds in question in this case to which I attach much importance; and which I desire to state more distinctly than my brethren have done in the several opinions prepared by them.

The law relating to commercial paper, bills of exchange, and promissory notes, by which the innocent holder, for value, before maturity, is protected against equities and defenses which might have been available between the original contracting parties, is not applicable to the holders of State bonds or municipal bonds. Every one who purchases such bonds knows that they purport to have been issued in virtue of delegated authority; and that their validity, as obligations of the State or of the municipal corporation, depends upon the nature and extent of the power granted by law.

In Wilson vs. City of Shreveport, 29 An. 678, we had occasion to consider this subject with reference to bonds issued by the municipal authorities of Shreveport; and the views we expressed in that case are equally applicable to bonds issued by the State:

“ Those who contract with municipal corporations know that these bodies act validly only within the powers conferred upon them by the special laws by which they are created; and the creditor of a corporation is bound to see that the contract or obligation of which he claims the benefit is within the power which the corporation may lawfully exercise. The fact that the obligation is in the shape of a negotiable instrument, or that it was acquired in good faith for a valuable consideration, before maturity, in no manner enlarges the power of the corporation, or gives any additional force or validity to its unauthorized acts.”

It is a great mistake to suppose that the State governments have unlimited power to tax the property of the inhabitants.

In an argument of great force, Mr. Justice Miller, delivering the opinion of the Supreme Court of the United States, in the Loan Association vs. Topeka, 20 Wallace, 658, demonstrates that all pur governments, State and national, in all their departments and branches, are of limited and defined powers. At page 664, he uses this strong language with respect to taxation in aid of private enterprises :

“To lay with one hand the power of the government on the property of the citizen, and with the other to bestow it upon favored individuals to aid private enterprises, and build up private fortunes, is none the less a robbery because it is done under the forms of law and is called taxation. This is not legislation. It is a decree under legislative forms.”

The suit was on bonds issued by the city of Topeka, in aid of a manufacturing company, in virtue of an act of the legislature of Kansas. The difference between that case and this is, that the bonds were issued by a. municipal corporation; and that they were a donation to the company. But if a municipal corporation, under the authority of an act of the legislature could not validly exercise this power, it is simply because the legislature itself had not such power, and, therefore, could confer no such power upon the municipal corporation. And, if it is not lawful to-make such a donation in aid of private enterprises, it is equally unlawful to lend the bonds of the State, in aid of such enterprises, to be paid by taxation, as principal and interest become exigible. This is certainly a donation of the use of the money, and of the interest on the'sums so-advanced. It is compelling the citizens to contribute annually, not for the use of the State, but for the use and benefit of the favored individuals, whose private fortunes are thus built up at the expense of the taxpayers.

Justice Miller lays down the proposition, and demonstrates it, that there can be no lawful tax which is not laid for a public purpose.

Interest had been paid on these bonds; but no importance was attached to that fact, since the payment of the interest was equally unairthorized as was the issuing of the bonds.

Looking into the history of this Bceuf and Crocodile Navigation Company, it will be seen that, in February, 1867, certain individuals in the parish of St. Landry, by notarial act, organized themselves as a corporation, for the purpose of improving the navigation of these bayous; and shortly after the legislature passed an act recognizing this company, and granting it the right to. navigate these bayous; to charge certain freight; and to collect tolls at the rate of f2 50 a ton on steamboats, and fl 50 a ton on other water craft, employed by others in navigating these waters, thus creating a monopoly in favor of this company. Among other extraordinary privileges granted to this company was the exemption of its property and franchises from taxation for ten years; so that the other citizens of the State were not only to be taxed to complete this work, but were to have their annual burdens increased for ten years, up to the taxable value of the property of this favored company thus exempted. See the act of 1867, No. 171, p. 315; approved twenty-eighth March.

There is another, and a fatal objection to these bonds, which, of itself alone, made them void ab initio. The constitution of Louisiana, article 111, provides that—

“ Whenever the General Assembly shall contract a debt exceeding in amount the sum of one hundred thousand dollars, unless in case of war to repel invasion or suppress insurrection, it shall, in the law creating the debt, provide adequate ways and means for the payment of the current interest and of the principal, when the same shall become due; and the said law shall be irrepealable until principal and interest be fully paid; or, unless the repealing law contain some adequate provision for the payment of the principal and interest of the debt.”

The State has no means of paying its debts except by taxation; and the power of the legislature to raise, by taxation, whatever amount may be necessary for the legitimate debts' of the State, can not be questioned. The plain meaning of this article 111 is that when the means of the State are anticipated by the contracting of a debt exceeding one hundred thousand dollars, some other ways and means, beyond the ordinary taxes for ordinary purposes, adequate for the payment of the principal and interest, shall be specially provided, appropriated, and set apart for that specific purpose; and, in order to preserve the good faith and credit of the State inviolate, the provision thus made contemporaneously with the contracting of the debt, is placed beyond the legislative power of repeal. It would be a waste of words to enlarge upon the wisdom of this constitutional restriction; but it is not out of place to say, that if it had been faithfully observed, the credit of the State could not have been abused to any great extent; the markets of the world would not have been flooded with its bonds; and strangers, trustirg to the honor and integrity of the State, and the assurance of its broad seal, would not have invested their means in these deceptive, unauthorized, illegal, worthless securities.

Turning now to the act approved January 3,1870, pages 21, 22, we find that it authorized the issue of bonds of the State to the amount of eighty thousand dollars, payable twenty years after date, bearing interest at eight per cent, each bond to be for $1000, with forty bonds for forty dollars each attached, representing the interest to be paid semiannually. That is, the principal of the debt thus contracted was $80,000, and the interest $128,000, making the whole debt thus contracted $208,000. The article of the constitution makes no distinction between the principal and the interest; indeed, it expressly characterizes both as constituting the debt, of which each is merely a separate part. The expression used in the article, “ the principal and interest of the debt,” is conclusive; and it is not possible to call the principal sum a debt without characterizing also as a debt the interest on thát sum stipulated in the same contract. The debt therefore thus created did exceed $100,000; and it falls within-the terms of this article of the constitution.

The act creating this debt does not provide adequate ways and means for the payment either of the current interest or of the principal. It does, indeed, declare, section 3, that all the rights and privileges of the Boeuf and Crocodile "Navigation Company are pledged, hypothecated, and specially mortgaged to the State; but the object of this is to secure the refunding, by the company, to the State, at the expiration of the twenty years, “all the sums of money paid by the State upon said bonds,” as provided in section 4.

Obviously, therefore, the State undertook to advance and pay, in principal and interest, $208,000 to the holders of these bonds; and in the act creating this debt no provision whatever is made for the means of paying either the principal or the interest.

Of what value is the declaration, in this act, that the rights and privileges of this company are pledged, hypothecated and specially mortgaged to the State ? Of what value were these rights and privileges ? What will be their value at the expiration of the twenty years ?

But if this security had been sufficient to indemnify the State, what provision is made in the act of adequate ways and means to enable the State to pay one single dollar of this debt to the holders of the bonds ? Absolutely none. The legislature simply ignored article 111 of the constitution, and violated its positive injunction. There can be but one consequence; it is inevitable. The act was ultra vires, and is void; and the bonds, having been issued without authority of law; in violation of the organic law, are absolutely void, and impose no obligation, legal or moral, on the State.

I concur in the decree just pronounced.

Concurring Opinion.

DeBlanc, J.

Under act No. 46 of the Legislature of the State of Louisiana, approved on the 3d of January 1870, the Governor of said State was authorized to issue — in favor of the Bceuf and Crocodile Navigation Company, domiciled in the parish of St. Landry, the bonds referred to in said act.

To whom were said bonds to be delivered? By whom alone could they have been either sold or pledged ? They could have been properly delivered but to the company in whose favor they were to be issued, and that company could have legally disposed of them but for one object: to raise money for the completion, of the work necessary to secure the navigation of the Bceuf and Crocodile.

How and by whom was that money to be raised ? In such quantities as would be deemed necessary, and by the President and Secretary of the company.

Instead of issuing those bonds in favor of the company, what was done? They were made payable to Henry Clay Warmoth, then Governor of the State, or bearer. In that form, they passed to the applicants, who claim that — under act No. 11 of the extra session of 1875, they have the right to compel the Board of liquidation to exchange them for consolidated bonds. In that form, they are not the bonds authorized by the statute of 1870 — and, as remarked by the Chief Justice, that fact could have been ascertained by reading the law published on the back of every instrument they hold.

Did the company receive those bonds, and did they pass — by transfer or otherwise — from the company to any one? That may be, but those facts are not shown. The actual bearers took them before maturity, and — in their opinion — by whom and howsoever their transfer was effected — -were it by one who acted with or without a mandate from the company — the delivery of the bonds, and the payment made by them to those by whom they were delivered, preclude the State from contesting their validity.

Were these questions presented by either the demand or the defence, we would certainly hesitate , to adopt the second conclusion. — but they are not-presented. We are called upon — under a special act — to declare, not whether the bonds were taken on good faith and before maturity — not whether in an authorized suit brought to recover from the State the amount of those obligations, the State would be cast — but whether, under the provisions of the act relied upon by plaintiffs, the obligations so transferred to them shall be exchanged for consolidated bonds ?

Had these bonds been made payable to the company, and, in that form, had passed to third parties, they might have carried, on their face, the presumption that they had been delivered to, received and disposed of by those who alone had the right to sell, pledge and transfer them. Stripped of that presumption, they do not bear in themselves the evidence that they were issued, delivered and disposed of in accordance with the law. If they were, to non-bond the State towards the holders, to bond the company towards the State, those facts must be legally established.

I concur in the opinion read by the Chief Justice.

Concurring Opinion.

Egan, J.

I attach more importance than seems to have been accorded to it to the fact that the bonds which are sought to be funded present the very novel peculiarity of having been executed by H. C. Warmoth, Governor, in favor of H. C. Warmoth, individually, or bearer. In my opinion, this can not be treated as surplusage in so large and important a transaction and one involving the faithful discharge of a public trust. It may be that no wrong was done or intended by this. It is, however, one of those acts which come under the head of constructive fraud, and one violative of the general rule which prevails not only in America but in England, and in all enlightened countries and of which the plaintiffs could not have been ignorant when they purchased these bonds — that “a trustee is bound not to do any thing which can place him in a position inconsistent with the interests of the trust, or which has a tendency to interfere with his duty in discharging itthat an agent can not dispose of the property of the principal to himself, nor execute in his own favor obligations in the name of his principal. In like manner that all agreements or obligations which are founded upon violations of public trust and confidence or of the rules adopted by courts in furtherance of the administration of public justice are held void, and that, too, whether fraud or a violation of trust public or private actually exists in the particular case or not. That eminent jurist and writer, the late Judge Story, announces these principles with great clearness and cogency in his Equity Jurisprudence, and so do all the standard works. Such is the settled jurisprudence of this State, the obligations of which especially rest upon us as administrators of its laws. It is, however, needless to cite authority in support of maxims so well founded and of so universal recognition; and nowhere to a greater extent than in Great Britain and New York, where the plaintiffs and intervenor acquired the bonds in question. This case bears no similitude to the execution by an individual to his own order or to himself or bearer of a note or negotiable instrument designed to be put upon the market. H. C. Warmoth, Governor, and H. G. Warmoth, the individual, are not one and the same entity. H. C. Warmoth could not, as Governor, make or sign any valid or binding obligation of the State payable to himself individually.

It will be understood that the subject we are discussing has nothing to do with the particular motives for the particular act of which no evidence is before us; we are simply dealing with the law which governs all such acts, lohether well or ill intentioned, and the public policy which makes such law necessaryj As has been very properly remarked by the Chief Justice, we are now acting under and solely in obedience to a statute which requires us to find or adjudge the existence o£ certain facts which are made by the statute a pre-requisite to the funding of obligations of the class now under review. Among these facts are the important ones whether they were issued in accordance with law and are valid obligations of the State. With this finding it has'been well stated the rules of law which give currency and credit to ordinary negotiable instruments for ordinary purposes have nothing to do. If it did, however, who will say that even according to the strictest rules of commercial law the holder or purchaser is not to be affected by what it bears upon its face V and even were the law and public policy which dictates it less imperative is there not enough in the unusual manner in which these instruments are drawn to put any purchaser upon inquiry at least and to give as to them double force to the principle of “ caveat emptor ?” But this is not all. The act which is printed upon the back of the bonds not only provides that the bonds shall be issued to the Boeuf and Crocodile Navigation Company, by its very terms, and that only so much of them as may be necessary to carry on the work shall be put in circulation by the president and secretary, (of which fact these bonds bear no evidence whatever,) but it goes farther, and provides that all the rights, franchises, and property of the company shall he mortgaged to the State to secure the payment of the bonds issued. under it, and the re-imbursement of any amounts which the State may have to pay by reason of the issue. Now the act itself makes no provision for the making or retaining of this mortgage in any special or unusual manner; and it must therefore be interpreted to mean that this must be done in the usual way by the execution of an instrument at least in writing, if not by public act, see La. ■Civil Code, art. 3305, as no valid mortgage can under our law be otherwise executed or retained. And not only is this true, but it was beyond the power of the Legislature had it even attempted it in express terms (as it did not) to provide for the retention of a mortgage to affect third persons and to give to the State and to its paper the security contemplated by the act, without not only the writing but the recording in the proper office or offices of registry and in the proper manner of the act or instrument of mortgage. Art. 123 of the State Constitution provides that "no mortgage or privilege shall hereafter affect third parties unless recorded in the parish where the property to be affected is situated.” La. •Civil Code, arts. 3342, 3345, 3347. 3348 make similar provision.

Again, conventional mortgages can only be agreed to by those who have the power of alienating the property which they subject to them. C. C. of La. art. 3300. Again, to render a conventional mortgage valid it is necessary that the act establishing it shall state precisely the nature and situation of each of the immovables upon which the mortgage is granted. La. Civil Code, art. 3306. Do not all these provisions of the constitution and laws of the State, of which the Legislature was and must have been cognizant, furnish additional evidence that the Legislature contemplated the issuance of these bonds to the Company itself, which alone, through its authorized officers, could grant a mortgage upon its property, and as we have seen it must be first granted before it could be recorded, and must be recorded to affect third persons or to furnish any security to the State such as the act expressly stipulated. • The legislative act was the letter of attorney of its officers in the premises. They had no power or authority to act or bind, the State otherwise than as provided in the act. If, therefore, the Governor chose to issue these bonds to himself or to any other person or corporation than the Boeuf and Crocodile Navigation Co. he acted in so doing without authority and thereby created no valid obligation of the State. It is also true that the act does not contemplate that the State authorities shall put these bonds upon the market. That power and duty are specially confined to the President and Secretary of the Company as the work may require. Every purchaser who deals in State securities is at least required to know the law which provides for their issuance.

For these additional reasons I concur in the decree.

Concurring Opinion.

Spencer, J.

The State by the funding act declared its willingness to fund its outstanding obligations 'at sixty cents on the dollar, and or.ganized the Board of Liquidation to carry into effect its provisions.

By act No. 11 of 1875, known as the Supplemental Funding Act, it declared that there were certain series of its obligations (among which are named those held by plaintiffs and intervenor), which were of doubtful legality, and it forbade said board to fund them, until the decree of this court had been obtained, declaring that they were legal and valid debts of the State, contracted in pursuance of its constitution, for a valid consideration and issued in strict conformity to law.

A State can be sued only by its own consent, and it may therefore impose such limitations and restrictions on the right of suit as it pleases. Hence this court, in determining its powers and duties in cases against the State, must look to the act authorizing the same, in order to determine the scope and limitation of its power and jurisdiction. Outside of the act authorizing the suit, and beyond the limitations therein fixed, it is absolutely without authority to hear and determine; and must therefore confine its investigations within the limits and to the objects specified.

Act No. 11 charges us to investigate, first, the constitutionality of the act under which the bonds held by plaintiffs were issued — second, whether, if the said act be constitutional, said bonds were issued in strict conformity to its provision — third, whether there was a good and valid consideration to the State for the bonds.

We are required to investigate each and all of these questions, and to report by decree the results of that investigation. It is manifest, therefore, that the accepted rules of the commercial law are not the sole, or indeed the controlling, guides for our investigations. That law forbids all inquiry into the consideration of. negotiable paper, when in the hands of bona fide holders for value and before maturity, as in this case. Whereas, act No. 11, which is the charter by virtue of which we have any authority in this case, declares that we shall go into that inquiry and specifically charges us with it! Which law shall we obey? Which law shall govern us ? Certainly the act No. 11 — for if that is not to govern us — if its injunctions are to be ignored, we are without authority to hear this cause at all. .Any decision we would render would bo coram non judice.

I do not think that the act No. 11 in any way changes the laws of evidence. The facts in controversy before us may be proved by any lawful evidence, direct or presumptive, oral or written.

It is also clear that this court is not by said act vested with power to render judgment against the State for any sum of money — but we are directed, as it were, to render a special verdict — to find the existence or non-existence of certain facts and conditions relative to said bonds; and according as we shall find them to exist or not exist, the State directs that the board shall act. Our jurisdiction is extended and limited to these inquiries. We can not go beyond them, nor stop short of them, without disregarding the law under which we are authorized to act. If we find any one of the conditions specified by the law to be wanting in these bonds, it will be our duty so to declare, and it will, then be the duty of the board not to fund them.

I therefore address myself to the inquiries submitted to us by the statute, to wit;

First — Is the law under which the bonds were issued violative of the constitution of this State or of the United States ?

Second — Were the bonds issued in strict conformity to the law authorizing their issue ?

Third — Did the State receive a good and valid consideration therefor?

As the first of these questions was not raised in argument or pressed I pass it.

The second point has been especially contested, and in my opinion is the one upon which the plaintiffs’ rights must stand or fall.

The act of the legislature granting aid to the Bceuf and Crocodile Navigation Company, directs in substance, by its first section, that $80,000 of bonds of the State shall be issued “in favor of" the said company. By its second section the president and secretary of said company are authorized to sell or pledge the said bonds so' issued. By its third section it stipulates and reserves a mortgage in favor of the State upon all the property, rights and franchises of-the-said company to secure the payment of said bonds, and the reimbursement of any amounts the State may have to pay on account thereof.

The bonds held by plaintiffs, and said to have been issued under said act, are made payable “ to H. C. Warmoth or bearer.” There is a caption to the bonds as follows: “ Bonds of the State of Louisiana.” “Issued in favor of the Boeuf and Crocodile Navigation Company.” Plaintiffs contend that this is a substantial compliance with the directions of the statute, and that the bonds being made payable “ to H. G. Warmoth or bearer” is immaterial, since they bear upon their face the statement that they were issued in favor of the company. Unless good reasons can be assigned to the contrary I should be disposed to accept this view. But I think such reasons- exist. The State was, in effect, loaning or rather proposing to loan its bonds to the company upon certain terms and conditions; which were that the company should pay the bonds when due, and re-imburse the State any sums it might pay on account thereof — these obligations of the company to be secured by a mortgage on its property and franchises. The company was only to sell or use so much of the bonds as were necessary for the contemplated improvements, and such bonds as were sold or pledged were to be so sold or pledged by its president and secretary. This offer to loan by the State was clearly ineohate and incomplete until accepted by the company, of which acceptance we have no proof in this record. The company could only be bound to pay said bonds, and to re-imburse the State if it paid them, and by the stipulated mortgage, in the event, and to the extent, the corporation accepted, received and used the bonds. It therefore became a matter of importance that these bonds should not be given out, except upon such terms and under such circumstances as would insure the liability of the company for their payment or re-imbursement, and make effective the mortgage of the State. It seems to me therefore that an important purpose was contemplated and to be attained, in requiring the bonds to be issued in favor of the company, and in specifying the officers of the company who should negotiate them. It was a means of fixing the liability of the company. If the bonds had been made payable to the company, they could not have been sold or pledged, except by the indorsement of the company by its president and secretary. I take it that the words “in favor of” used in this statute must be .taken in their usual and ordinary signification, which is synonymous with “payable to.” When we speak of a note being given “ in favor of ” a person, we mean and are understood to say that it is payable to him. I think that the act contemplated and required that these bonds should be made payable to the company, and that there was a good reason and purpose in so requiring. As the bonds were in fact issued, i. e., payable to Warmoth or bearer, the company could, (and if solvent,) no doubt would dispute successfully its liability to the State, by denying that it ever received or disposed of them. I therefore think there was a fatal variance between the bonds as issued and the statute authorizing their issue, and that therefore they were not issued “in strict conformity to the law.” I prefer to rest my concurrence upon this ground.

I concur in the decree of the court in this case.


source: Caselaw Access Project

author: DeBlanc, J.

license: Public Domain

text:
    No. 6778.
    State vs. George Washington et al.
    TJae judge presiding at a criminal'trial can not, either in his charge to the jury, or at any time during the trial, declare the existence of any fact bearing on the case at issue, or deny the existence of any such fact, when it is asserted to the jury by tho counsel of the accused in the course of his argument.
    APPEAL from the Superior Criminal Court, parish of Orleans, Whitaker, J.

      H. N. Ogden, Attorney General, for the State.

      L. Marrero for defendant and appellant.
   The opinion of the court was delivered by

DeBlanc, J.

Defendants were indicted for and convicted of rape, a crime — -the legal price of which should ever be the life of the perpetrator. The jurors by whom they were tried, returned against them the qualified verdict of “guilty, without capital punishment,” If guilty, they were fortunate indeed that a too merciful qualification was attached to the verdict.

During the trial in the lower court, their counsel — in addressing the jury — asserted that one of the State witnesses had testified that the prosecutrix had no other mark of violence on her person but the laceration of her private parts. The judge presiding denied the assertion thus made by the counsel, and prevented him from commenting on the disputed fact. To that interruption, the prisoner excepted, and — on that ground — moved for a new trial.

That interruption was unauthorized and irregular — and, as it came from one who is justly presumed to stand indifferent and disinterested between the prisoner and the State, from one in whom an impartial jury is justly inclined to believe and trust, it may have influenced their minds and verdict. Were he -mistaken, the denial by the judge of a fact asserted by an attorney, would often impair, and might even destroy' the legitimate effect of proper evidence, dispel reasonable doubts, reconcile conflicting opinions, change already formed convictions, and substitute — to that of the jurors — the judge’s recollection of the facts disclosed on the trial.

What does the law command? “In his charge to the jury, the judge shall not state or repeat the testimony of any witness —nor shall he give any opinion as to what facts have been proven or disproved.” Revised Statutes, Sec. 1963. This he did, during the trial and before his charge, and this he could not legally have done at any stage of the trial. In his ardent zeal to protect society against the repetition of the most execrated, the most infamous crime, he has vitiated the verdict returned against the prisoners, and — to our regret — the sentence based on that verdict must fall.

It is — therefore—ordered, adjudged and decreed that the judgment appealed from and the verdict of the jury, be and they are hereby annulled, avoided and reversed, and that this case be remanded to the lower court for a new trial.


author: Manning C. J. Spencer, J.

text:
    No. 5402.
    J. H. Montague et al. vs. Weil & Bro.
    ¿jjy former member of a dissolved commercial Arm may be brought into court by a Arm creditor and condemned for a social debt, contracted while he was a member, on a citation addressed to the ./inn, but servod personally on him ; when the citation is accompanied by a certified copy of the petition, in which the creditor prays for a judgment against each former member of the firm in solido.

    The reduction of an agreement to writing, signed by the parties, is not necessary to-its perfection as a contract, unless it clearly appears that the parties intended that it should not be complete as a contract, until so written and signed.
    Whoever by word, or act, purposely persuades another that a certain state of things exists, which induces him to act so as to alter his previous position, is estopped from denying the existence of that state of things.
    APPEAL from the Sixth District Court, Parish of Orleans. Saucier, J.

      Finney & Miller for plaintiff and appellee.

      J. C• Egan for defendants.
   The opinion of the court on the original hearing was delivered by

Manning C. J.

and on rehearing by

Spencer J.

The defendants in August 1873 leased a store from plaintiffs for one year, commencing from first of November following at seventy-five dollars per month, payable at the end of each month. They were occupying the store under a former lease at the time the new lease, or agreement to lease, was made, and the rental of the old lease, which expired on thirty-first October was one hundred dollars per month. The agreement was that the store should be whitewashed, and a written lease and rent-notes were to be signed. The first of these stipulations was performed by plaintiffs, and they also had prepared the necessary writings for the signature of the defendants, which were presented to them. Objection was made by them because of an opening in the upper part of a wall,, and this was closed to comply with their wishes, and the lease and notes-again presented to them for signature. They expressed their willingness to sign them, but deferred doing it from time to time, giving unsatisfactory excuses for this omission or delay in signing, but never refusing, on the contrary always promising to execute the lease and sign the notes.

On the 10th. of October, the plaintiffs’ agent addressed a letter to the defendants, reciting at length the agreement, and his subsequent efforts to obtain the defendants’ signature to the lease and notes, recalling to their recollection their promises to sign, their delays, and informing them of his purpose to enforce the contract. They promised many times, and to several persons to comply with their agreement. The occupant of the adjoining store was requested by the plaintiffs’ agent to take the matter in hand, and he says that Samuel Weil, one of the firm, constantly declared his intention to sign the papers, and talked with him about the lease fifty times. It is indubitably established that the defendants made the agreement to lease, and afterwards repeatedly expressed their willingness and intention to perfect it by executing the lease and notes. But they never did execute them.

They continued however in the occupancy of the house, and during the first week of December paid the rent for November under the new lease. After this payment of the November rent, the plaintiffs’ agent inquired of Samuel Weil again if he had executed the lease, and the latter promised to do it the next day.

On the 15th. of December the plaintiffs’ agent received a written notice that Samuel Weil, successor to Weil & Bro. would not keep the storehouse longer than first proximo, and this was signed S. Weil per M. G. Weil. On the 26th. of that month plaintiffs brought this suit to recover the rent agreed on in this new lease, and provisionally seized the contents of the store. The sum sued for is $825 with interest on the monthly instalments from their maturities.

There is no dispute that the occurrences have been correctly detailed. Upon one matter alone is there any difference, and that is whether notice of the dissolution of the firm was ever given to plaintiffs. But the defendants deny any liability, because the lease was not complete until they had signed it. There was an agreement to lease upon specified terms, and the lease was to be signed, but this agreement was never consummated. The lease never was signed. It is also urged in defence that the firm of "Weil & Bro. was dissolved on 25th. October 1873, six days before the lease was to begin, and notice of its dissolution was published in a newspaper on the 31st., and therefore the firm could not be held responsible on the lease, and that it has paid all the rent due up to the time of its dissolution. It was also urged by way of exception that the firm could not be sued after its dissolution by service on one of its members, and that no judgment could be rendered against the member who was cited, because the citation was addressed to the firm.

The defence is not good, and first as to the exception. Since the case of Kearney vs. Fenner 14 Annual 870. it has not been disputed that service of citation upon one partner of a commercial firm was sufficient, and that a judgment against the firm was properly rendered upon such citation. It is also true that a commercial partnership exists for the purpose of its liquidation, after it has been dissolved, and the former partners may be sued in the Court of the firm domicil on the liabilities of the firm, and in a late case this doctrine was extended so as to permit them to be brought in by attachment, if they were non-residents. Lobdell vs. Bushnell, 24 Annual, 295.

A commercial firm is not permitted to escape its obligations by a dissolution, nor will such dissolution oppose any obstacle to its creditors enforcing their obligations in the court where they were enforceable during the existence of the firm. Troplong remarks this as an anomaly ;— L’état d’une Société de commerce pendant sa liquidation présente de singuliéres anomalies. Cette Société est dissoute, mais dans l’usage du commerce ello est censée subsister encore pour se liquider. Elle a pris fin pour commerce pour agir et entreprendre ; il semble qu’elle so prolongue en quelque sorte, pour regler le passé et mettre ordre a ces affaires. C’est cette idée qu’ exprime la formule usitée dans les circulaires des nógocians. La Société ne subsiste plus que pour sa liquidation. Traité de la Société, 2. to No. 1004.

In a very early case, Des Boulets vs. Gravier, 1. N. S. 420. this Court approvingly quotes from Pothier the general rule touching the necessity of reducing the agreement to writing and thus states it;— it must appear to be the intention' of the parties to make the perfection of the agreement depend on the writing, for if it was merely contemplated to secure a more authentic'mode of proof, then neither party can pretend the contract was not complete. Zacharie formulates the doctrine thus ; — La clause par laquelle les parties conviennent de consigner leur convention dans un acte sous seing privé, ou de la faire constaten par acte notarió n’en fait pas dependre l’existence de laecomplissement de ces formalities, a moins qu’il ne resulte clairement des termes mémes de cette clause ou des inconstances, que telle a étó l’intention des parties. Une clause de cette nature doit, en gónéral, étre considerée, comme ayant uniquement pour objet d’assurer la preuve de la convention a laquelle elle se rapporte. 2 to 466 note.

The intention of the parties here nowhere appears to be to make the existence of the lease depend upon its formal confection, and the signing. On the contrary the payment of the November rent under that lease is evidence that they regarded it as complete, for if the store was held under the old lease, a hundred dollars should have been paid instead of seventy-five. The defendants, both by words and conduct, induced the plaintiffs to believe that they regarded the new lease as binding and complete, and it is a sound principle of law, as well as of morals, that where one by his words or conduct, wilfully causes another to believe in the existence of a certain state of things, and induces him to act on that belief so as to alter his own previous position, the former is .concluded from averring- against the latter a different state of things as existing at the same time. Marsh vs. Smith, 5 Rob. 523.

The answer of the defendants to this is, that the firm of Weil & Brother did not pay the November rent, nor continue occupying the house, but only Samuel Weil, one of the former members of that firm, and that notice of the dissolution of the firm was brought home to plaintiffs by publication in a newspaper, as well as by personal notice. The agent of the plaintiffs says he did not receive personal notice of the dissolution, and never heard of it until late in the year, and we believe him. It was said in oral argument by the defendants’ counsel that the plaintiffs were affected with notice by the newspaper publication, and that the rule is that to those who had had dealings with a firm, a newspaper publication of dissolution was all that was required, and a special notice was required only by others. The rule is just the reverse. Special notice of the dissolution should be given to those who have had dealings with the firm.

Certainly the plaintiffs were not told that the firm had ceased to occupy the house during November and up to the middle of December, when the defendant were often applied to to sign the lease, and these different applications afforded convenient and appropriate opportunities for such information to be given. Nor does the payment of the rent for November by Samuel Weil alter the relative positions of the parties. He was one of the firm, and its active member, and represented it.

After the institution of tbe suit, the rent for December was paid, and is so considered in the judgment, and in March the plaintiffs rented the house to other parties for the benefit of the defendants and for the I’emainder of the term of their lease. This rental has also been paid, and plaintiffs concede that credit should be allowed for these sums.

It is therefore ordered, adjudged, and decreed that the judgment of the lower court is affirmed, subject to the credit of fifty dollars on the first of April 1874, and same sum on the first of each succeeding month up to and including the first of November of that year, and that the plaintiffs have and recover their costs of the defendants.

On Rehearing.

The opinion of the court was delivered by

Spencer, J.

The facts of this ease are in the main fully stated in our former opinion and need not here be repeated.

One point urged by the defendant, however, did not receive any special mention therein. To wit: That in executing the writ of provisional seizure it is alleged that the sheriff did not simply seize the effects in the store belonging to defendants, but actually took possession of the leased building and its keys, and excluded the defendant from the premises. It is claimed that this was an act for which plaintiffs are responsible, and amounted to a dissolution of the lease. There can be no doubt that if such an act were done by the lessor that it would, at the option of lessee, dissolve the lease. But it is not pretended that the sheriff had any mission, either by law or in fact, from the plaintiffs to do this act. The sheriff’s return shows only a seizure of the effects in the house. One of the defendants’ clerks swears that the sheriff took possession of the house, keys, and every thing in the house.

There is no proof that plaintiffs even knew of this fact, if fact it be. They were not informed thereof by the sheriff’s return on the writ, or by any act or word on the part of defendants.

This silence on the part of defendant, especially when taken in connection with the formal notice of the fifteenth of December, of his intention to abandon the leased premises on the first of January, proximo, makes this objection come with very bad grace from him. The seizure was made on the twenty-sixth of December, only four days before the time he had fixed for his abandonment, and we regard him as estopped from setting up that the lease was dissolved by a pretended exclusion from a house which he had formally given notice he intended to quit.

The only serious question involved is that raised as to the sufficiency of the citation. It was addressed “to Weil & Bro.,” and served in person on Samuel Weil, against whom alone judgment was rendered. The question is, therefore, whether, after the dissolution of the firm in fact, but before any special notice thereof to plaintiffs who were entitled to such notice, a citation addressed to the firm, and served on a member in person, will have the effect of a legal citation to the member so served ?

The question is not free from difficulty. We have lately had occasion, in the case of Ranlett vs. Collier White Lead Company, to examine and review the authorities upon the subject of the proper mode and place of citing the members of a dissolved commercial partnership, in a suit for a debt of the partnership. We then held that each partner-must be separately served with citation, .and could not be cited to appear in such suit out of the place of his domicile.

But it is urged by plaintiffs that this rule does not apply until the creditor of the partnership has had legal notice of the dissolution, and that until such notice, the firm, quoad such creditor, continues to exist. The contrary was held by this Court in Brashear vs. Dwight, 2 An. 404, when it was said : “ It is satisfactorily proved that before the institution of this suit the partnership of Bemiss, Brashear & Co. had been dissolved, and the dissolution published in the newspaper of the village where it had been carried on. It is contended that the plaintiffs in the suit were in the habit of trading with the firm, and that notice of the dissolution should have been brought home to them otherwise than by publications in the newspapers.

The ground would be well taken if the object of the plaintiff had been to make the defendant liable in a direct action against him for dealings had with the firm after its alleged dissolution, but it does not affect the manner of bringing the partners of a dissolved partnership into Court.”

We think, therefore, that the question before us is not affected by the fact that the creditor has or has not had notice of the dissolution.; and eliminating this there remains the simple question, whether a citation addressed to the dissolved partnership, and served on one of the partners, is a good citation of that partner ?

It must be borne in mind that this was served on Samuel Weil in person, with the citation “to Weil & Bro.,” a certified copy of plaintiff’s petition, in which it was specifically alleged and set forth that the firm of Weil & Bro. was composed of Samuel Weil and M. Weil, and in which there was a prayer for judgment against the firm and against each member thereof in solido. The object and purpose of citation is notice. Under the facts of this case it is not possible that Samuel Weil could have been misled as to the identity of himself as a party defendant in such cause. The citation to Weil & Bro., accompanied by the copy of petition, and served on Samuel Weil personally, sufficiently designated him, and was a substantial compliance with art. 179 of the Code of Practice, which provides that the citation “ must mention the name of the defendant to whom it is addressed.”

We think this case comes within the purview of the doctrine held by the courts of France, under their code of procedure which is very similar to ours. The rule, is thus stated in Copier vs. Déspus, Cassation, twenty-third of November, 1836: “Les erreurs ou omission dans un exploit n’entrement pas nullitó toutes les fois que cet exploit, ou les pieces qui Faccompagnent, renferment des énonciations qui peuvent reparer ces erreurs ou omissions.”

On the other points involved in this cas.e we adhere to the views expressed in our former opinion, and see no reason to change the conclusions therein reached. We think this case differs from that of Avandano vs. Arthur, just decided, in this, that Arthur at all times refused to sign, while in this defendants at all times promised to sign the lease; over and over recognizing its existence. So the parties clearly did not contemplate the writing as the completion of their agreement, but only as its evidence.

It is, therefore, ordered that the decree heretofore rendered by this court remain undisturbed.


author: Manning, C. J. Marr, J.

text:
    No. 5397.
    David L. Ranlett vs. the Collier White Lead Company.
    When a judgment debtor brings suit in a State court to annual a judgment of that court against him, and in favor of a non-resident creditor, the latter is not, under the act of Congress passed in 1789, entitled to an order to remove the ease to a Circuit Court of the United State.
    APPEAL from the Fourth District Court, parish of Orleans, Lynch J.

      Singleton and Browne for plaintiff and appellant.

      J. Ad. Hosier for defendant.
   The opinion of the court was delivered by

Manning, C. J.

The plaintiff sues to annul a judgment, obtained in one of the District Courts of this city by the defendant, against the commercial firm of Dix & Banlett, of which plaintiff was a member. The defendant, before pleading, filed a petition praying the removal of the cause to the Circuit Court of the United States on the. ground that the Company had its domicil in the State of Missouri while the plaintiff was a resident of Louisiana.

A similar application was made in Goodrich & Hunton, which was also an action to annul a judgment, and with which was joined a prayer for an injunction against further proceedings upon the original judgment until the suit for its nullity could be heard. In that case, our decision was based upon that part of the application which demanded the removal because the party was restrained from executing his judgment, and the removal was refused. 29 Annual. 372.

The present suit is divested of that feature, and is an action of nullity pure and simple. The petition for removal was filed in 1874, and is claimed under the act of Congress of 1789.

The action to annul a judgment is a pendant to the original suit; and a consequence of it. In that, the Collier Company sought the jurisdiction of the State Court, and obtained its judgment therein. It was plaintiff, and waiving its right to proceed in the courts of the United States, commenced its action in the courts of the State where its debtors reside. When those debtors, or either of them, attack the judgment rendered against them in the tribunal that rendered it, and seek to annul it, the original.plaintiff has not the right to decline the jurisdiction selected by himself, and compel his debtor to go with him into another forum to test the validity of the judgment obtained by him. The lower Court thus ruled, and we approve it.

The defendant then excepted to the petition of plaintiff, that it discloses no cause of action. The pleadings do not inform us wherein the petition is defective. There is no allegation of the want of any specific ingredient in the complaint of plaintiff, necessary to make it complete, and we are left to conjecture and ascertain what it may be. We discover none.

Whether the alleged grounds of nullity are sufficient to warrant the judgment which the plaintiff asks, and whether the co-defondant, Dix, in the original suit should have been a party to this, are matters for subsequent inquiry. At present, and with the pleadings before us, we have only to reverse the judgment of the lower court which sustained the exception to the petition because it disclosed no cause of action, and dismissed the suit, in doing which the judge was equally reticent with the pleader as to the defects that vitiated the petition.

It is therefore ordered, adjudged, and decreed that the judgment of the lower court is reversed, and the cause is remanded thereto to be proceeded with according to law, the defendant paying costs of appeal.

On Application for Rehearing.

Marr, J.

Appellant was a member of the commercial firm of Dix & Ranlett, which had its domicile at New Orleans. This partnership was dissolved in 1859 or 1860; and in 1861 appellant removed to the parish ' of Jefferson where he resided continuously until 1865 or 1866. In January, 1864, suit was brought against him, as a member of the late firm of Dix & Ranlett, by the Collier White Lead and Oil Company, in, one of the District Courts of the parish of Orleans ; and judgment was taken against him by default, which was confirmed in June, 1864. He demands, in this suit, the nullity of that judgment, for want of jurisdiction.

The appellee, in whose favor the judgment thus attacked was rendered, excepted on the ground that the petition disclosed no cause of action. The allegations of fact, on which appellant’s action is based were not traversed: they are admitted to be true, and must be taken to be true for the purposes of this exception.

By the general law of Louisiana suit must be brought in the parish in which defendant has his domicile, if he reside in the State. C. P. arts. 129, 162. There are exceptions to this rule, one of which is that “in matters relative to partnership, as long as the partnership continues, in all suits concerning it, the parties must be cited to appear before the tribunal of the place where it is established.” C. P. art. 165, no. 2.

On the allegations of the petition the presumption would be that the court which rendered the judgment complained of was without jurisdiction, unless some fact appears which prevents that presumption, and takes the case out of the general rule. No reasons are assigned for the judgment maintaining the exception ; but the argument of counsel for appellee in this Court, rests upon the hypothesis that the partnership continued in 1864 for the purpose of liquidation, although it was dissolved in 1859 or 1860 ; and that the partners were subject to the jurisdiction of the Court of the place of the social domicile, without regard to their residence or domicile. As there was neither allegation nor proof of any prolongation of the partnership, for any purpose whatever, the judge must have assumed that it continued within the intent and meaning of the C. P. art. 165, no. 2, as a presumption juris et de jure.

We think that the decision in Lobdell vs. Bushnell, 24 An. relied upon by counsel for appellee, has been misunderstood and misapplied The case was thus:

Lobdell and Colwell, residing in the parish of West Baton Rouge, Bushnell, who lived in one of the Northern States, and Woodward, who resided in the State of Mississippi, were partners ; and the domicile of the partnership was at New Orleans. About two years after the dissolution, Lobdell brought suit, in one of the courts of New Orleans, for a settlement of the partnership. Bushnell was found at New Orleans, and was cited personally; a curator ad hoc was appointed for Woodward and was cited in his stead ; and Colwell was cited in his parish. Colwell excepted to the jurisdiction; and his exception was maintained on appeal. A rehearing was granted; and the first decision was set aside, and the exception was over-ruled. The Court said:

“ The partnership, although dissolved, still continued for the purposes of liquidation, and a partition of the gains. And we think the partners may be sued at the domicile of the partnership for such purposes.” 24 An. 696, 697.

There was, in reality, no occasion for the enunciation of this proposition. Bushnell did not reside in the State ; and he was properly cited where he was found : C. P. art. 165, no. 5 : and the Court thereby acquired jurisdiction as to him. The partners were not bound in solido; they were joint obligors, liable jointly to the complaining partner for his share of the gains; and all of them were necessary parties to the suit, as the Court well observed. Ex necessitate the court which acquired jurisdiction with respect to one of them was vested with jurisdiction as to all of them; and it could not have proceeded to judgment without, having them all made parties. R. C. C. 2085 ; Faurie vs. Millaudon, 3 N. S. 478.

In support of that part of the opinion just quoted the Court cited 3 N. S. It should have been 6 N. S., 188 : 6 La., 685: and 13 La 484.

In the first of these cases, Dufau vs. Massicot’s heirs, Dufau, Massicot, and Wiltz were partners; and Dufau brought suit against Massicot’s heirs to recover Massicot’s share of the debts of the partnership paid by Dufau. Wiltz was not a party to this suit. The Court decided that the share of the debts of the partnership due by one of the partners could not be judicially established without having all the partners before the Court: that is, a partnership can not be liquidated in a suit in which all the partners are not parties.

In the second case, Lincoln vs. Ball’s executors, some of the partners brought suit against the executors of a deceased partner, for liquidation. Another of the partners was dead; and his representatives were not made parties. The Court decided that in a suit for the liquidation and settlement of partnership transactions and accounts all the partners must be parties, either as plaintiffs or defendants.

In the third case, Cutler vs. Cochran, suit was brought, after the dissolution, by one of the partners for the use of himself and the other partners, on a note payable to the partnership. The Court decided that all the partners must join in the suit.

It was in this case that Judge Martin said: “On the dissolution of a commercial partnership, by mutual consent, the partnership continues for the purpose of liquidation ; but as, during its existence, all the partners must join in a suit against its debtors, although either of the partners might receive payment of the debt, so, after the dissolution, an individual partner, notwithstanding he may still receive payment, can not institute suit without joining his co-partners.”

This suffices to show the restricted sense in which Judge Martin understood that a partnership continues after dissolution. The several partners become, by the dissolution, in the absence of a different agreement and provision, and where it has not become necessary to provoke the appointment of a receiver by judicial authority, equal administrators of all the property and effects of the partnership, and liquidators of its affairs. Their interest in all the property assets of the partnership still continues, and their liability to the creditors of the partnership remains unchanged, notwithstanding the dissolution. This seems to be all that is meant by what Lindley, in his work on Partnership, side page 332, characterizes as a loose statement, “ that a partnership which is dissolved is, nevertheless, deemed to continue so far as may be necessary for winding up its affairs.” See Story on Partnership, § 325 : Collyer, § 118 : Kent’s Com. 3. side pages 56, 64: Crawshay vs. Collins, 15 Ves. 227 : Lyon vs. Haynes, 5 Manning & Granger, 541 ; Troplong, Société, 2, p. 467, no. 1000.

Our attention has not been called to the decision of a court of the State of Louisiana, to the effect that, after the dissolution of a partnership, the several partners who reside in parishes different from that in which the partnership was established, may be sued for debts of the partnership in the parish of the social domicile. Certainly no such thing was decided in Lobdell vs. Bushnell, nor was any such question presented to the Court in that case.

When a partnership is dissolved that juridical being, that ideality no longer exists ; and it can not be said to continue in the individuals who composed it, or in the liquidators chosen by them, or in the receivers judicially appointed, in any other or different sense than a deceased natural person could be said to live in his heirs, or executors, or administrators. On the dissolution, the several partners become subject to the general laws, which were suspended with respect to them so long as the partnership continued, in all suits concerning the partnership. All the partners in a commercial partnership are liable in solido for the debts of the partnership; and when the partnership is dissolved, that liability may be enforced against them singly and individually. See David vs. Eloi, 4 La. 107. Lambeth vs. Vauter, 6 Rob. 127.

In. Hobson vs. Whittemore, 13 La. 422, it was held that, during the existence of the partnership, all the partners, defendants, must be cited before the court of the social domicile; and that the plea of domicile in another parish by one of them was of no avail.

In Black vs. Savory, 17 La. 86, it was decided that after a dissolution, two of the partners, who lived in a parish different from that of the social domicile, might- be sued in the parish of their domicile, for a debt of the partnership.

In whatever sense, therefore, it can be said that a partnership continues for the purpose of liepúdation notwithstanding the dissolution, it is not true in the sense that they must be, or that they can be cited to appear before the tribunal of th'e social domicile, at the suit of creditors of the partnership, when they reside in other parishes. Obligors in solido are amenable, each, to the jurisdiction of the tribunal of their respective domiciles; and as each may be sued alone for the entire demand, neither reason nor authority requires that they should be pursued in the tribunals of other parishes.

- Wo should not have deemed it necessary to go into this discussion but for the stress which has been laid upon the decision in Lobdell vs. Bushnell; and the manifest misinterpretation which has been put upon it.

The rehearing is refused.

       By act of 1870, No. 103, published in Acts of 1871, p. 18, joint obligors may now bo sued separately, and judgment obtained against each for his share.


author: Spencer, J.

text:
    No. 6669.
    The State vs. Pat. Malloy.
    A criminal information may in two separate counts, charge two separate, but kindred offenses, growing out of the same transaction. Such an information is not obnoxious to the objection of duplicity.
    An information charging the crime of burglary, or grand larceny, describes the place where the offense was committed with sufficient certainty when it gives the parish, the name of the owner of the house, and the house in which the offense is alleged to have been committed.
    Where an information under the count of grand larceny, charges the theft of various things of small valué, a verdict of the jury that the accused is guilty of “petit” larceny is sufficiently responsive to the indictment, and does not amount to an acquittal on the count of grand larceny.
    When the crime charged in the indictment is one of which the Superior Criminal Court has jurisdiction, the finding of the jury for any smaller crime will not divest that court of jurisdiction.
    APPEAL from the Superior Criminal Court, parish of Orleans. Whitaker, J.

      H. If. Ogden, Attorney General, for the State.

      Cullom, & Castellanos for the defendant.
   The opinion of the court was delivered by

Spencer, J.

Defendant was prosecuted in the Superior Criminal Court on an information charging that he did in the parish of Orleans, etc., on the twenty-sixth of June, 1876, first, break and enter, in the night time and with intent to steal, the shop of one Joseph Cimarelle. Second, that having so broken and entered, etc., he did, at the time and place aforesaid, steal, take and carry away one gold watch of the value of $150, one pair of shoes of fhe value of $5, and certain other chattels, named and described. In other words the information contained two counts, one for burglary and one for grand larceny, growing out of the same transaction. The defendant filed a motion to quash the information, first, for duplicity, in that it contains two counts for two offenses, distinct, substantive, and of different natures and character. Second, for uncertainty in that it does not describe the place alleged to have been burglariously entered, with that minuteness which would enable him to plead autre fois acquit or convict. This motion was overruled, and the trial resulted in the following verdict:

“ We, the jury, find the accused of the first charge not guilty. The second charge not guilty. We find said accused guilty- of petit larceny. ”

Thereupon the accused filed a motion in arrest of j udgment — assigning as grounds therefor, those of the motion to quash already mentioned, and these in addition, to wit: First: That the verdict of petit larceny is not responsive to the information.. Second: That under the verdict the Superior Criminal Court was without jurisdiction. Third : That under the verdict of not guilty of the charges in the two courts, the prisoner is entitled to his discharge. This motion was overruled and the defendant sentenced to two years at hard labor. He appeals. His counsel has not favored us with an argument or any reference to authorities.

The motion to quash was, we think, properly overruled. There is no duplicity in the information. It charges in separate counts two kindred offenses growing out of one and the same transaction. See 8 A. 109, 114. We think the objection that there is no certainty in the charge is not well taken, even as to the charge of burglary, of which he was acquitted, much less as to that of grand larceny, under which he was convicted.

A verdict of guilty of petit larceny is responsive to an indictment charging the theft of various articles, as in this case. By the verdict he was found not guilty of grand, but guilty of petit larceny. This was no more an acquittal under that count, than a verdict of “not guilty of murder,” but “guilty of manslaughter” would be an acquittal under an indictment for murder. The other objection, that the verdict of guilty of petit larceny divested the Superior Criminal Court of jurisdiction, can hardly be considered as serious.. The jurisdiction of courts in criminal matters is governed by the offense charged or penalty imposed, just as that of civil tribunals is governed by the amount in dispute. If on account of the absence of some ingredient of the offence charged, the offense is reduced to a less penal one of a kindred nature, the court may sentence for the lesser offense, although an indictment for that offense could not have been originally entertained by it; just as a civil court may on trial of a demand for a greater, give judgment for a lesser amount than its jurisdiction originally embraces.

The sentence and judgment appealed from are affirmed.


author: Marr, J.

text:
    No. 6753.
    Bertrand Saloy vs. Amos S. Collins.
    A judgment of the lower court which dissolves an injunction, and which passes definitively on all the essential points at issue between the parties, i» a final judgment from which an appeal will lie to this court.
    But a judgment is incomplete until signed by the judge who rendered it, and hence, until thus signed, this court can not take cognizance of an appeal from it.
    APPEAL from the Second District Court, parish of Orleans. Pardee, J.

      Charles P. Schmidt for plaintiff and appellee.

      Ckillom & Castellanos for defendant.
   The opinion of the court was delivered by

Marr, J.

Under a writ of seizure and sale the sheriff of the parish of Orleans advertised and was about to sell the mortgaged property, when Collins, the mortgagor, obtained an injunction, on the ground that, either the judge who granted the order was without jurisdiction or the civil sheriff of the parish of Orleans was without power or authority to execute the writ.

Saloy, the seizing creditor, moved the court to set aside and dissolve the injunction, with damages and costs, on the grounds:

First — That the injunction bond was irregular, and insufficient.

Second — That the surety on the bond was not good and solvent.

Third — That the petition for injunction, on its face, discloses no cause of action, and no right to the relief prayed for.

The judge gave his reasons at length, and signed them, for his judgment; and on the same day, rendered judgment dissolving the injunction, with twenty per cent damages, and costs; and Collins appealed.

The judgment which we find in the record is copied from the minutes. It is not signed, nor is there any evidence or indication in the record that it was actually signed.

The sole purpose of the injunction suit was to arrest the proceedings under the writ of seizure and sale, on the grounds stated in the petition. The judgment dissolving the injunction, with damages and costs, decided all the points in controversy between the parties; and it was, therefore, a final judgment; C. P. article 539 ; which the law required the judge to sign. C. P. art. 546.

This court has jurisdiction of appeals from final judgments, C. P., art. 565, and of such interlocutory judgments as may cause irreparable injury. Art.-566. But an interlocutory judgment, which need not be signed, is merely a decision on preliminary matters, which still leaves the merits to be disposed of by the definitive judgment. C. P. art. 538.

No appeal lies from a definitive judgment until it is signed. The appeal, therefore, in this ease was premature, and this court is without jurisdiction to entertain it, or to make any further inquiry touching it.

The appeal therefore is dismissed with costs. .


author: Manning, C. J., Spencer, J.

text:
    No. 6461.
    Police Jury of the Parish of Plaquemines vs. James Foulhouze et al.
    The right to an office will not be considered on any rule taken in this court.
    If it appears from a scrutiny of all the provisions of an act of donation inter vivos that it was the real intention of the donor, and of the donees, that the land conveyed by the act should be dedicated' to public use, such land will be held as thus dedicated.
    Property dedicated to public use is not liable to seizure and sale.
    Property held by a municipal corporation in trust for public uses can not be alienated by the corporation, nor subjected to seizure and sale by any of its creditors.
    Where a certain tract of land has been dedicated to public use — the whole of it remains thus dedicated, although only a part has been actually put to public use. Nor is this dedication at all impaired because a part of the land has been temporarily leased to private individuals.
    APPEAL from the Second Judicial District Court, parish of Plaque-mines. Pardee, J.

      B. T. Beauregard, District Attorney pro tem., and Henry Chiapella for plaintiff and appellee.

      E. Howard McCaleb for defendants.
   The opinion of the court was delivered on the rule by

Manning, C. J.,

and on the merits by

Spencer, J.

Mr. B. T. Beauregard applied to this Court to be recognized as District Attorney pro tempore of Plaquemines Parish, and exhibited a commission therefor. The order was made, though there was no occasion for either the application or the order. Shortly thereafter he filed a motion in this cause, and thereupon T. A. Elanagan took a rule upon him to shew cause why this order of recognition should not be rescinded, this relator alleging that he is the legal District Attorney pro tem. oí that parish.

This has the appearance of an attempt to determine the contestation for an office under the guise of this rule to rescind an order. We shall take no action in the case until it has been determined, judicially or otherwise, who is the person to represent the parish in this suit.

We shall dismiss the rule, and rescind the order of recognition, thus restoring all parties to the status quo and

It is accordingly so ordered.

On the Merits.

Spencer, J.

Defendants being judgment creditors of the parish of Plaquemines issued execution, seized and advertised for sale “ a certain tract of land * * having and measuring one arpent front by thirty-six arpents in depth, bounded in front by certain lands belonging to the parish of Plaquemines on which are situated the Court House and jail of said parish, etc.” * * * The said land being the thirty-six rear arpents of a certain tract, acquired by defendant, the parish of Plaquemines, from Jacques Larose by Act of Donation inter vivos passed before Ed. Barnett, notary, etc-., on the twentieth of June, 1846.” The land thus seized, together with that referred to as containing the Court House and jail, constituted a tract which, as stated, was donated by Larose, “to the inhabitants of the parish of PlaqueminesThe Act of Donation contains the following clauses: the donor declares that he does by these presents make donation inter vivos, gratuitous and irrevocable, unto the inhabitants of the parish of Plaquemines in this State, their heirs and successors, herein represented by Messrs. Andre Casse, Geo. N. Johnson and Geo. N. Buford, duly authorized, etc., by the police jury of said parish, accepting the same for said inhabitants, and acknowledging possession thereof, a certain arpent of land, etc.” —describing the land aforesaid — “ To have and to hold the said arpent of land and appurtenances, unto the said inhabitants, etc., to their proper use and behoof forever. ”

“ The present donation is made on the express condition that said inhabitants shall build and erect the Court House of the aforesaid parish on the piece of ground herein above described. ”

The Court House and jail were erected on that part of said tract fronting on the Mississippi river. It seems that the police jury in 1875 leased the rear portion of said tract — the thirty-six arpents now seized — ■ to one Gantrelle, who cultivated it in rice.

The police jury send out this injunction against the sale of said land under execution as aforesaid, on the ground that the same had been dedicated to public use and was “ hors de commerce. ”

The Court a qua so held, and the defendants appeal.

There can be no doubt that Larose, by said donation, intended to* set apart1 the land in question to a public use. He declares that the donation is made “ on the express condition ” that the donees should build the Court House thereon. The appellants in their argument admit that this was the motive which induced the douation, but say it was not a condition of the donation. It matters not whether this stipulation was or was not a condition in the technical sense of that term. It is the duty of this court to ascertain the intent, “ the motive actuating the parties, and to give effect thereto if not unlawful. The right of Larose to dedicate this piece of property to public uses is not disputed. If such was the motive and intent which actuated him to make the donation — and if the donation was accepted for the purpose intended by the donor, it would seem past all controversy that. the act of donation was intended to, and did, dedicate the property given to the use of the public.

Property dedicated to public use can not be the subject of private ownership. It is out of commerce, and not liable to seizure. R. C. C. 449, 454, 455, and 458. Police Jury of Baton Rouge vs. Michel 4 A. 84, 7 A. 595,18 A. 560, 2 A. 527, 21 A. 244, 29 A. 38, 630 — Dillon on Municipal Corporations, Sec. 531.

It is, perhaps, not unworthy of note that this donation is made “ to the inhabitants ” of the parish of Plaquemines, and not to the parish in its corporate capacity. If the corporation can in any sense be deemed the owner or holder of the property donated, it owns or holds it, by the very terms of the act, “ for the proper use and behoof forever ” of the inhabitants.

“ A municipal corporation has no implied or incidental authority to alienor dispose of for its own benefit property dedicated to, or held by it, in trust for the public use, nor can it extinguish the public uses in such property, nor is such properly subject to the payment of the debts of the miinicipality.” Dillon on Municipal Corporations, Sec. 512.

“Municipal corporations possess the incidental or implied right to alienate or dispose of their property, real or personal, of a private nature, unless restrained by charter or statute: they can not, of course, dispose of property of a public nature, in violation of the trusts upon which it is held, nor of the public squares, streets or commons. The distinction is between property which a corporation may own, the same as a natnral person, and that which it holds in general or special trust.” Dillon on Municipal Corporations, Sec. 445.

What the corporation can not itself do directly, can not bo dono indirectly by judicial process.

We see no significance whatever in the 'fact that the whole of the donated tract is not iu actual public use. It suffices that the public has a right to use. Nor does the fact that the part seized'was cultivated in rice in 1875, under lease from the parish, operate to deprive the public of its rights of use. We have just seen that the parish can not directly or indirectly divest the property of its public character. How much of said property is or is not needed for the use of the public, is not, in its nature, a judicial question. It suffices for us to know that the public has a right to the use of the luhole, and, for aught we can know, may have some day necessity for its use. Fifty years hence the Court House and jail may be, by encroachments of the river, driven to what is now the rear arpent of the tract. But -these are considerations with which this Court has nothing to do. We must ascertain and enforce the rights of parties — which are governed by the law and not by the river.

There is no error in the judgment appealed from and it is affirmed with costs of both courts.


text:
    No. 6652.
    J. M. Serra é Hijo vs. Hoffman & Co.
    In determining wind effect tlie discharge in bankruptcy of a principal debtor will have on the obligation of his surety, this court will be guided by the law of Louisiana and not by the bankrupt law.
    Under the law of this State the discharge in bankruptcy of the principal on an appeal bond, will not release the surety on that bond from any obligation he incurred by signing the bond.
    The surety who pays the debt of his principal is subrogated, by more operation of law, to all the rights of the creditor. No act of subrogation by the creditor, in his favor, is required.
    APPEAL from the Fifth District Court, parish of Orleans. Rogers, J.

      Geo. L. Bright for plaintiffs' and appellants.

      Hudson & Fearn for defendants.
   The opinion of the court was delivered by

Spencer, J.

Plaintiff obtained judgment against Hoffman & Co. for $1945 29 in gold, with five per cent interest in gold from twenty-sixth November, 1872, and costs.

Defendants took a suspensive appeal, giving Wolkart as surety on the bond. Pending this appeal, Hoffman & Co. were adjudged bankrupts and discharged as such.

The appeal was tried and the judgment below affirmed against Hoffman & Co. who, however, afterward pleaded their discharge from the judgment.

The plaintiff thereupon in due form proceeded against the surety for the amount of the judgment against Hoffman & Oo. The surety pleaded that he was released by reason of the discharge in bankruptcy of his principals; and the court below so held. Plaintiff appeals, and the question is presented to this court.

Counsel on both sides have discussed this question, as one depending on the bankrupt law, and have cited us to numerous authorities from the reports of other States, p>ro and con. As might be expected there is considerable conflict among them, and for the simple reason, no doubt, that these courts were governed by different systems of law.

The bankrupt law undertakes to regulate and govern the rights and obligations of the bankrupt only. It provides the manner and effect as to himself of his discharge, but in no way undertakes to determine the effect of his discharge upon the obligations of others — out of superabundance of caution, however, the 5118th section of the United States Revised Statutes declares: “ No discharge shall release, discharge, or affect any person liable for the same debt for or with the bankrupt either as partner, joint contractor, indorser, surety, or otherwise.”

In determining the effects of a discharge of the principal, upon the obligations of his surety, we have therefore nothing to do with the bankrupt act. It is the law of Louisiana alone which governs, and to which we must look for a solution. Hence we attach but little weight to the decisions of foreign tribunals upon their own laws, differing perhaps radically from ours. It may well be that the effect of a discharge of the principal would be to release the surety, by the law of Massachusetts, and not to release him by laws of New York.

Under the law of Louisiana, therefore, does the discharge in bankruptcy of the principal release the surety ?

Article 3014, O. C. C., says: “ The obligation of the surety toward the creditor is to pay him in case the debtor should not himself satisfy the debt,” etc.

To satisfy a debt in the sense of the law is to pay it — to perform or do the thing one is obligated to do or perform.

Does a discharge in bankruptcy operate a payment of the debt — a performance of the obligation ? In a late case, “ Ludeling vs. Fulton,” 29 An. 720, this court said: “A surrender in bankruptcy does not operate or have the effect of a payment. Payment extinguishes absolutely the obligation, both morally and legally. Bankruptcy is simply a bar to the enforcement of it.” We adhere to that doctrino, and consider it elementary. When we turn to our Code under the chapter treating of “ the extinction of suretyship,” we find no such cause as that of the bankruptcy of the principal. On the contrary, we find by article 3029 that the surety “ can not oppose” to the creditor “ exceptions which are personal to the debtor.” We find, also, by article 3026, that so far from the “ bankruptcy or insolvency” of the principal releasing the surety, the latter is given the privilege of proceeding against the principal or his estate for indemnity, before paying or even being sued for the debt.

To hold that the bankruptcy or insolvency of the principal releases the surety, would be to expunge the title of suretyship from our Code. It would be to render that important contract a mockery, a delusion, and a snare. The very purpose, and the only purpose, of suretyship is to save the creditor from the effects of the insolvency, bankruptcy, or inability to pay of the principal.

As we have seen, the obligation of the surety is to pay the debt if the principal does not pay it. The defendant’s argument makes the surety liable, if the principal does not pay, or does not go into bankruptcy. This last condition is not found in the law of Louisiana. The distinction between the “ insolvency” and “ bankruptcy” of the principal, as to its effects on the obligations of the surety, is equally without foundation in our law. It matters not whether the non-payment by the principal proceeds from insolvency, bankruptcy, dishonesty, minority, or coverture. It is the fact of non-payment, non-perfonnance, by the principal which renders the surety liable. Nor is there any force in the objection that after the bankruptcy the creditor can not subrogate the surety. It requires no act of subrogation by the creditor. The lav) subrogates the surety to such rights as the laio gives the creditor — to such rights as the creditor has — no more, no less. If the insolvency, bankruptcy, or dishonesty of the debtor has rendered those rights valueless, it is the surety’s misfortune — not the creditor’s fault. The creditor does not warrant that the debtor will pay the surety. The judgment appealed from is erroneous.

It is ordered and decreed that it be reversed; and it is now ordered and decreed that the plaintiff, Serra c Hijo, have and recover of the surety, Justin Wolkart, the amount of the judgment of said Serra é Hijo against Hoffman & Co., to wit: nineteen hundred and forty-five dollars and twenty-nine cents, in gold, with five per cent interest in gold thereon from twenty-sixth November, 1872, till paid, and all costs of that suit, as well as the costs of this suit.