author: Pociié, J.

text:
    No. 8656.
    The City of New Orleans vs. A. Marchand and Thomas Duffy, Sheriff.
    The law does not and cannot sanction or maintain a sale of property by the original owuer or by bis vendee during the pendency of a revocatory action instituted by a creditor of the original owner, seeking to avoid, in its effects as to him, an alleged fraudulent sale of llie same property by bis insolvent debtor.
    The property thus claimed to be liable for tbe payment of bis debt by a creditor cannot bo alienated pending his action so as to prejudice bis light.
    APPEAL from the Civil District Court for the Parish of Orleans. Bightor, J,

      Chas. F. Bucle, City Attorney, for Plaintiff and Appellant.

      B. li. Forman and W. 8. Benedict for Defendants and Appellees.
   The opinion of the Court was delivered by

Pociié, J.

The City of New Orleans has enjoined the seizure of a dredgeboat and other movable property, seized as the property of the Mississippi and Mexican Gulf Ship Canal Company, in execution of a judgment obtained by Marchand against said Company.

The City claims title to the same property under a purchase from (he Company and from Van Norden, who had previously bought the same property from the same vendor, and she prosecutes this appeal from a judgment dissolving her injunction and rejecting her demand.

The record shows the following facts :

A. Marchand and J. A. Willard, both judgment creditors of the Ship Canal Company, instituted separate suits for the revocation of the sale of the property now under seizure, by the Company to Van Norden, on the ground that said sale had been made by the insolvent Company in fraud of its creditors.

During the pendency of these two revocatory actions the City made the purchase hereinabove referred to, in which Van Norden joined his vendor in the transfer to the City.

In the suit of Willard, which had been brought in the Federal Court, the City claimed, by third opposition, the ownership of the property; and being defeated in her claim, she paid the Willard judgment, and thus averted the sale of the property. She now renews her claim of ownership in the Marchand case, coupled with the alternative demand for the reimbursement, by preference, out of the proceeds of the contemplated sale, of the amount which she paid for the Willard judgment.

The issue presents for solution the question, whether during the pendency of a revocatory action for the purpose of setting aside an alleged fraudulent sale of property to the detriment of the complaining creditor, a valid sale of the same property can be made by the vendor or his vendee, or both.

The mere statement, of the foregoing facts, considered in the light of the provisions of our Civil Code, as expounded in our jurisprudence, is a negative answer to the proposition.

The object of the revocatory action is to avoid and annul the contract in its effects on the complaining creditor, and the legally prescribed effect of a judgment in favor of the complaining creditor is to s'nalee the property sought to be transferred, or its proceeds, liable to payment of his claim. C. C. Art. 1977.

Hence, it logically follows that a construction of the law which would sanction a sale of the identical property during the pendency of the action, either by the original vendor or by his vendee, would absolutely defeat the remedy which the law means to extend to creditors, for the purpose of avoiding the fraudulent acts of insolvent debtors. '

To remove all possible doubt on the subject the law has specifically and wisely provided that such an attempted sale is a nullity. C. C. Art. 2453.

Such has been the uniform exposition of the law on this subject by this Court. Gillespie vs. Cammack, 3 An. 252; Cantereau vs. Lacaze, 9 An. 257; Ranlet vs. Constance, 15 An. 423; Paget vs. Curtis, Id. 453.

By the payment of the Willard judgment the City acquired ho greater rights than Willard himself possessed.

By the release of his Seizure Willard would have lost all claim to any privilege resulting from his seizure, and such is the attitude now occupied by the City. Hence, her claim for reimbusement of the Willard judgment as against Marchand cannot be entertained.

The City cannot fortify her position by the argument that the purchase of the Company’s dredgeboat was for the purpose of public utility, and that the purchase was specially authorized by an Act of the legislature enacted in the year 1876, under which she could have expropriated this specific property.

The judgment of Marchand against the Company was rendered in 1872, his revocatory action was instituted in 1873; and the right which he thus acquired of reaching the Company’s property fraudulently transferred to Van Norden could not be subsequently affected by any claim of the City, or divested by any subsequent legislative action.

The judgment in favor of defendants is therefore correct, and is affirmed with costs.

Bermudez, C. J., absent.


source: Caselaw Access Project

author: Todd, J.

license: Public Domain

text:
    No. 8013.
    John Lane vs. The Sun Mutual Insurance Company.
    Where a policy of insurance on buildings issues to a party, but the loss is, by the terms of the policy, made payable to another, who, the evidence shows, bolds a special mortgage .. .on the property, the party to whom the policy issues cannot alone and without authorization from the beneficiary maintain a suit to recover the loss.
    Where, in the same policy, a lot of furniture is insured on account of another party, the suit to the extent of the loss on the furniture will be maintained in the name of the policy holder where it is shown that such beneficiary has authorized the suit for his benefit and his ownership of the furniture is proved.
    APPEAL from tbe Fourth District Court for the Parish of Orleans. Houston, J.

      W. B. Lancaster and J. C. Coleman for Plaintiff and Appellee.

      Leovy & Kruttschnitt for Defendant and Appellant;
   The opinion of the Court was delivered by

Todd, J.

The plaintiff sues for $1,300, interest and costs, the amount of a policy of fire insurance, under which a total loss is alleged to have occurred.

Among other defenses urged in the answer is, that the loss, if any, was by the stipulations of the policy made payable to one John R. Clay, and that the insurance on the furniture mentioned in the policy was by the terms thereof made on account of one William Boyce, and defendant denies that the plaintiff is entitled to any part of the indemnification therefor, and avers that he is absolutely without right or interest to sue for the same.

From a judgment in favor of the plaintiff the defendant appeals.

The property insured consisted of a dwelling house, kitchen, two cisterns and a lot of furniture.

The loss is not disputed except as to the cisterns, of the destruction of which it is averred there is no evidence.

An examination of the policy shows that the loss, as charged in the answer, is made payable to John R. Clay, and the furniture insured for account of Boyce, and the evidence shows that Clay had a special mortgage on the property still unpaid, and that Boyce was the owner of the furniture.

Plaintiff does not sue as the mandatory of either of these parties, but claims judgment for the loss in favor of himself.

The Code of Practice provides (Art. 15) that “ an action can only be brought by one having an actual interest which he pursues.”

The plaintiff, notwithstanding the stipulations of the policy, may have an interest in the loss, on which point we express no opinion, but that interest, if any, is indeterminate in the absence of other parties interested and in the face of the stipulation that the loss was to be paid to Clay, and in view of the fact that Clay, or the representative of his apparent interest, is not a party to the suit, it becomes a matter of impossibility in this action to determine and adjust the respective rights and interests of the parties, which the court below endeavored to do by its judgment. Had Clay, or the representative of bis claim, been a party to the suit, a larger interest than allowed by the judgment might have been shown in his favor.

There is no'pretense that Clay, or the holder of his interest in the policy, has authorized this suit and the recovery of the loss, or any part thereof, for his benefit.

To the Extent of the loss on the buildings upon which Clay’s mortgage operated, it is clear that plaintiff has no right to maintain this action singly and in his own right, and this part of the demand must be dismissed.

As to the insurance on the furniture the case is different. As stated, the policy shows that it was insured on account of Boyce, and the evidence establishes that the furniture belonged to him, and that he authorized the plaintiff by this suit to claim and recover the loss thereof for his benefit. The defendant Company is, therefore, protected from any claim of Boyce on this account to be asserted by another suit or otherwise, and for the amount of the loss in this respect and to this extent the plaintiff is entitled to a judgment.

It is, therefore, ordered, adjudged and decreed, that the judgment of the lower court, so far as it awards any sum to the plaintiff on account of the loss of the buildings and cisterns described in policy of insurance set forth in the petition, be reversed, and the demand to that extent be dismissed as of non-suit, with a reservation of the rights of all parties therein, and that in awarding a recovery for the loss of the furniture to the amount of two hundred and fifty dollars and interest from the time therein stated, that it be affirmed. The costof the lower court to be paid by the defendant, and of the appeal by the plaintiff.


author: Poché, J.

text:
    No. 8167.
    Mathilde Van Creelen vs. The Massachusetts Mutual Life Insurance Company.
    A stipulation in a policy of life insurance, issued by a Massachusetts company, that the unpaid portion of the year’s premium shall always be considered as an indebtedness to the company and that the failure of the insured to pay any instalment of premium when due shall operate a forfeiture of the policy, except as provided in Chapter 186, Laws of the Commonwealth of Massachusetts, approved April 10th, 1861, does not violate the provisions of that statute. • Under such a contract the amount of the unpaid premium must be deducted from the net value of the policy at the date that the premium becomes due and is not paid, in ascertaining the net single premium remaining to the credit of the insured, and intended by the Statute to carry a temporary insurance, notwithstanding his failure to pay the stipulated instalment of premium when it became due.
    APPEAL from the Civil District Court for the Parish of Orleans. Monroe, J.

      J. 0. Egan and O. N. Ogden for Plaintiff and Appellant.

      Merrick, Foster & Merriek for Defendant and Appellee.
   The opinion of the Court was delivered by

Poché, J.

Plaintiff brings this suit as beneficiary of a policy of insurance, issued by tlie defendant on October 2d, 1877, for live thous- and dollars, on the life of her husband, Oscar L. Yan Creelen, who died on the 29th of August, 1878.

Among other defenses the Insurance Company urges that the policy lapsed for non-payment of the stipulated premium due on the 2d of April, 1878.

Plaintiff admits the non-payment of the premium as alleged, but contends that the policy was kept alive and- in full force up to and beyond the time of the death of her husband, under the provisions of Chapter 186 of the General Statutes of Massachusetts, approved on April 10th, 1861, providing for the non-forfeiture of policies of insurance for non-payment of the premiums thereon.

The judgment of tlie lower court rejected plaintiff’s demand, and she prosecutes the present appeal.-

The Statute of Massachusetts invoked by plaintiff, a special reference to which is made in the policy,- reads as follows :

• 1. “ No policy of insurance on life hereafter-issued by any company, chartered by the authority of this commonwealth, shall be forfeited or become void by the non-payment, of premium thereon, any further than regards the right of the party insured therein to have it continued in force beyond a certain period, to be determined as follows, to-wit: The net value of the policy when the premium becomes due and is not paid shall be ascertained according to the * combined experience,’or ‘ actuaries ’ rate of mortality, with interest at four per cent, per annum. After deducting from such net value any indebtedness to the company, or notes held by the company against the insured, which notes, if given for pi-emium, shall then be cancelled, four-fifths of what remains shall be considered as a net single premium of temporary insurance, and the term for which it will insure shall be determined according to the age of the party at the time of the lapse of premium, and the assumption of mortality and interest aforesaid.”

2. “If the death of the party occur within the term of temporary insurance covered by the value of the policy, as determined in the previous section, and if no condition of the insurance other than the payment of premium shall have been violated by the insured, the company shall be bound to pay the amount of the policy the same as if there had been no lapse of premium, anything in the policy to the contrary notwithstanding.”

Defendant recognizes the full force and binding effect of this law as forming part of its contract with the deceased, but contends that under a proper construction of the contract, in the light of this legislation, plaintiff’s claim must be defeated and rejected. . .

The contract stipulates that the policy was issued in consideration of an annual premium of $155.36, to be paid in consecutive semiannual instalments on or bofo re the 2d of October and April each and every year during the continuance of this policy, and contains, among others, the following conditions :

“ That this policy shall not take effect until the advance premium hereon shall have been paid during the lifetime of the person whose life ■is hereby insured, and that if any subsequent premium or instalment of premium on this policy shall not be paid on or before the day when due, then this policy shall cease and determine, except as provided in Chapter 186, Laws of the Commonwealth of Massachusetts, approved April 10, 1861, under the provisions of which law this contract is made.”

That no premium or instalment of premium shall be considered as paid unless a receipt shall have been given therefor at the time of payment- duly signed by the President or Secretary of said Company, and that in ease the annual premium is not all paid at the beginning of the year, the unpaid portion of the year’s premium shall always be considered as an indebtedness to the Company.”

Plaintiff’s contention is, that in ascertaining the net value of the policy on the 2d of April, 1878, when the premium became due, under the rules of the u combined experience,” or actuaries,” as provided for in the Statute, the amoimt of the unpaid premium cannot ho considered as a debt due by the insured to the Company, and must not bo deducted from the net value of the policy as ascertained under the directions above mentioned.

Defendant, on the other hand, maintains that suoli unpaid instalment is specially declared in the contract to he an indebtedness which must, under the law, be deducted from the net value of the policy before determining the net single premium of temporary insurance left to the credit of the insured.

This construction is clearly supported by the plain and unambiguous stipulations of the contract quoted above, and it must prevail unless it be shown, as plaintiff contends, that that condition is violative of the Statute of Massachusetts, regulating the contract, and now under consideration.

Calculations made by several experts, under the theory advanced hy the defendant, show that on the 2d of April, 1878, the net value of the policy was $95.22, from which must be deducted the amount of the unpaid premium, $77.68, leaving a balance of $17.54, four-fifths of which would, under the provisions of the law, he the single net premium to the credit of the insured, and would have carried his temporary insurance to the 14th of July, 1878, and that, therefore, it follows that the policy had lapsed and was of no value when the insured died on August 29th, 1878.

Barring the basis on which deduction is made of the unpaid premium, plaintiff does not contest the correctness of the experts’ calculations and conclusions. Her contention is that, under the contract, her husband’s life was insured for six months; after which the net value of the policy, which should be subjected to no deduction, because there was no indebtedness to the Company, formed a net single premium of temporary insurance, in consideration of which the policy would have been left alive far beyond the date of lier husband’s death.

As we read the contract we understand that the insured had bound himself to payan annual premium of $155.36, to be paid in equal semiannual instalments, and that he unequivocally covenanted and agreed that in case the annual premium is not all paid at the beginning of the year, the unpaid premium shall always be considered as'an indebtedness U> the Company.

Turning to the Statute, we find therein a provision to the effect that notes held by the Company against the insured, if given for premium, must be deducted, as indebtedness, from the net value of the policy.

This provision certainly recognizes an unpaid instalment of premium as a debt of the insured to the Company, and we cannot sanction an interpretation limiting the form of the proof of such indebtedness to that of a promissory note. A solemn promise or obligation to pay a sum of money at a stipulated time, evidenced by an instrument in writing, such as a contract of insurance, is as binding on the obligor as the same promise evidenced by a promissory note.

We are at a total loss to discern the slightest difference between the obligation resulting from such a contract and that resulting from the promise to pay in a promissory note. Both are unmistakable evidences of indebtedness, and both must be held as included in the expression used in the Statute. Our conclusion is not only supported by reason and law, but is in keeping with the interpretation of the Statute adopted by the Supreme Court of Massachusetts in two cases involving the proper construction of the Statute which we are now considering. It stands to reason that such authority, if not conclusive, is at least entitled to very great weight in the determination of the issue presented in this ease. '

In the ease of Pitt, Administratrix, vs. Berkshire Life Insurance Co., reported in 100 of Massachusetts, page '500, the policy contained a statement that the full amount of the annual premium had been paid, but in point of fact the total amount of the premium was not then paid, but a portion only was paid, and'-the balance was represented by promissory notes of the insured, which he failed to pay at maturity.

The policy contained'the clause of forfeiture for non-payment, of premium, in so far as not modified by the statement in question. The Court held that the indebtedness of the insured to the Company, evidenced by the premium notes, should be deducted from the net value of the policy before ascertaining the net single premium of temporary insurance to his credit.

The same ruling was made in the case of Bigelow vs. State Mutual Life Assurance Association, 123 Mass.T13, presenting the same issue as the preceding case, which was formally reaffirmed. It is worthy of note .that the statement contained in the policy that the first annual preuiium had been paid in full, when, in point of fact, a portion of the same was represented by promissory notes, presented a difficulty in those cases which is not met in our case, where the agreement to pay semi-annually appears on the face of the contract, and in which the amount due in April, 1878, forms part of and is identified with the contract of insurance.

In support of her' theory plaintiff relies exclusively on a decision reported in 73 New York Reports, p."4^0, in the ease of Goodwin vs', this defendant.

We are satisfied, from the statement of facts in that opinion, that the policy sued upon in that case did not contain the same clauses, and did not therefore evidence a similar contract to those contained and shown by the policy in this case; and hence, we conclude that the case is not applicable to the issue with which we are now concerned.

But we would not hesitate, in case of conflict between that case and those reported from the Supreme Court of .Massachusetts, in which the Court interpreted a Statute .of their own State, to be guided by the latter.

The judgment appealed from is, therefore, affiz’med with costs.'

Rehearing refused.


text:
    No. 8761.

    John A. Hunter, Sheriff and Tax Collector, vs. Ed. Lisso.

      A charge or commission for an attorney’s fee, where a parish license is sought to be collected by suit, imposed by an ordinance of a police jury, cannot he collected. The parishes aro without authority to impose such charge.
    APPEAL from the Tenth District Court, Parish of Red River. Logan, J.

      M. 8. Jones for Plaintiff and Appellee.

      J: F. Pierson for Defendant and Appellant.
   The opinion of the Court was delivered by.

Todd, J.

The defendant is a retail grocer, and in connection with his business as such, sells liquor in quantities less than a pint, in the town of Coushatta, Red River Parish.

On the 7th of April, 1882, having made his affidavit in conformity to law, the same proving satisfactory to the tax collector for said parish, he was granted a State license to pursue his business for fifty dollars, which he then paid.

.On the 1st of May thereafter, he was sued by the parish for one hundred dollars, the amount of the parish license claimed for the same business, with ten per cent, thereon as a penalty or commission for attorney’s fees and costs, which commission wasimposed by an ordinance of the police jury.

On the next day the defendant tendered to the tax collector fifty dollars for his parish license, which the collector concluded to accept and did receive, and thereupon issued such license.

There was judgment for the parish, condemning the defendant to cease from the further pursuit of his business until he paid fifty dollars for his parish license with ten per cent, thereon penalty for attorney’s fees and costs of the proceeding, and further ordering that this judgment for the license, ($50) penalty and costs, be credited with $50 paid the collector on the 2d of May previous.

From this judgment the defendant appeals, and pleads the irregularity and illegality of the proceeding, and charges that the fee of the attorney or penalty imposed is wholly unauthorized, null and void.

It is obvious from the express language of the Constitution, that the defendant’s State license having been fixed and assessed at fifty dollars, the parish could not exact a greater license or one for a larger sum. Constitution 1879, Art. 206.

Though the defendant paid his parish license and exhibited and filed a proper receipt therefor, nevertheless, by the terms of the judgment, lie is expressly enjoined from continuing his business until he pays a license (that is, another license) which is therein declared due1 the parish for the year 1882. The judgment is manifestly wrong in this particular, and was doubtless so worded as to compel the payment of the penalty and costs.

We do not think the defendant justly liable for either. The parish was wrong in demanding from him, by suit or otherwise, the payment of one hundred dollars, twice the amount of the State license. He paid on this demand all that could be rightfully claimed of him, of which the acceptance of the tender and issuance of the license by the tax -collector was a conclusive acknowledgment, and with that payment the proceeding- should have ceased.

It is not reasonable to suppose that the defendant could be chargeable with a penalty for declining' to pay an unjust and illegal demand, and one acknowledged to be such by the officer seeking to enforce it.

Besides, there is no warrant in law for the imposition or collection of an attorney’s fee or commission by the parish.

The State has the right to prescribe a charge of this kind against delinquents for State taxes and licenses, and has done so, but we And no delegation of such right to the parishes, and it is elementary that they and other municipal or political corporations can exercise only such powers as are expressly conferred or which result from clear and cogent implication. Dillon on Municipal Corporations, § 55 et seq.; City vs. Philippi, 9 An. 44; State ex rel. vs. Shreveport, 33 An. 1180.

We are referred to Art. 218 of the Constitution as the source from which the power claimed is derived.

This Article merely extends the provisions of the Constitution “regulating and relating to the collection of State taxes and tax sales,” to the collection “ of parish, district and municipal taxes.”

This, nor no other Article of the Constitution, prescribes that the imposition of such fee or commission shall form a part of the regulations relating either to State or parish taxes—leaving out of view the question of licenses—nor does Section 13 of the license Act referred to and also cited as supporting the authority exercised in this instance, confer any such power on the parishes. It only gives the right to any municipal or parochial corporation to impose a license tax on any business,occupation or profession provided for in the Act, and is silent as to the imposition by such corporation of any such charge for non-payment of the license.

Conceding, therefore, that a delinquency was shown on the part of-the defendant in paying his parish license—of which we are not satisfied under the facts of this case—we find no authority conferred on the police jury to compel the defendant, in addition to his license, to pay, as a penalty or otherwise, the fee of an attorney for attesting the license under legal process, and he was wrongly condemned todo so.

It is, therefore, ordered, adjudged and decreed, that the judgment of the District Court be annulled, avoided and reversed, and that there be judgment for defendant, with costs of both Courts.


author: Manning, J.

text:
    No. 8006.
    L. Rombach vs. The Piedmont & Arlington Life Insurance Co.
    A son-in-law has not an insurable interest in the life of his mother-in-law.
    When the insurable interest arises or is implied from, relationship, it will be held to exist when the relationship is such that the insurer has a legal claim upon the insured for services or for support.
    Even where such legal claim does not exist-, but from the personal relations of the insurer and the insured, the former has a reasonable right to expect some pecuniary advantage from the continuance of the life of the latter, or to fear loss from his death, an insurable interest will bo held to exist.
    A policy of insurance, procured by one for bis own benefit upon the life of another, the beneficiary being without interest in the continuance of the life insured, is against publio policy and therefore void.
    APPEAL from the Third District Court for the Parish of Orleans. Monroe, J.
    . -1. & W. YoorM.es for Plaintiff and Appellant.

      Singleton cC Browne for Defendant and Appellee.
   The opinion of the Court was delivered by

Manning, J.

The plaintiff insured the life of his mother-in-law in the defendant Company in February, 1873, for two thousand dollars, the policy reciting that it is issued “ for the sole use of her son-in-law, L. Rombacli.” His wife, the daughter of Eliza Geisler, had died leaving two children of tender years. Mrs. Geisler had insured her own life a month before in this Company for the benefit of two of her own children, for the same sum as this policy.

The agent of the Company sought Rombacli, and told him of the policy Mrs. Geisler had taken, and asked if he did not want to take another, to which Rombacli answered approvingly, provided the consent of Mrs. Geisler was not necessary. He avowed his object, to he the benefit of his only child, one of them having died. The agent assured him it was of no consequence whether she consented or not, provided lie paid the premiums promptly.

The first quarterly premium of $22.86 was paid on the spot. Mrs. Geisler soon heard of the matter, and on March 20 she wrote to the Company expressing strong disapproval, and exhibiting had feeling to her son-in-law, and demanding the cancellation of the policy. On the next day the agent, by direction of the Company, offered to pay back the premium to Rombacli and demanded the return of the policy for cancellation. Rombacli refused to receive the money, and denied the Company’s right to cancel the policy, whereupon the Company can-celled it, and notified both Rombacli and Mrs. Geisler thereof.

Thereafter, Rombach on each quarter-day tendered the premium then payable on this policy to the Company, until Mrs. Geisler’s death in December, 1877, and the Company refused to receive it.

The defendant pleads in answer that the policy is void because obtained through false and fraudulent representations of Rombach, viz., that he applied personally to the Company for the policy, requesting its issuance, and represented that his mother-in-law desired the policy to be taken by him. We do not believe that. Eombach’s plain, unvarnished statement is given already, and it is so perfectly in accord with the habit of insurance agents that it Cannes home conviction of its accuracy.

The additional defense is that the policy is void for want of interest and consideration—that there was no love and affection between the assured and the beneficiary,” and that he had not “ such interest as the law requires to maintain such a policy.” ■ ^ •

The phraseology of this first quotation from the answer, as well as the interrogatories t'o all the witnesses, implies that the personal relations of the parties—their affection or hatred—is conceived to be the test of insurable interest. They do not affect it all. Much time was wasted on both sides in exhibiting Mrs. Geisler’s antipathy to her son-in-law at one time, and her reconciliation to him at another.

The insurable interest in the life of another is a pecuniary interest. A policy of iusurauce, procured by one for his own benefit upon the life of another, the beneficiary being without interest in the continuance of the life insured, is against public policy and therefore void. It is thoroughly settled, because universally held, that a wife has an insurable interest in the life of her husband, and although in that case especially it might be assumed that love and affection furnished á sufficient basis for it, the decisions do not place it on that ground, but rather on the support she is entitled to from him. The Books formulate the general principle somewhat in this way : when the insurable interest 'arises, or is implied from relationship, it will be deemed to exist when the relationship is such that the insurer has a legal claim Upoii the insured for services or support. Even though such legal claim does not exist, yet where from the personal relations of the two, and the kindness and good feeling displayed by the insured to the insuree, the latter ha.s a reasonable right to expect some pecuniary advantage from the continuance of the life of the former or to fear loss from his death, an insurable interest will be held to exist. Bliss’ Life Ins., $ 31; May’s Life Ins., U 74, 106.

It was said in Phenix Mut. Life Ins. Co. vs. Bailey, 13 Wall. 616, “it is sufficient to shew that the policy is not invalid, as a wager policy, if it appears that the relation of consanguinity or affinity was such * * as warrants the conclusion that the beneficiary had an interest, whether pecuniary, or arising from dependence, or natural affection, in the life of the person assured,” but this is a dictum of Clifford, J., and is not in accord with the decisions generally. A majority of the reported cases will be found to be rested upon pecuniary considerations or expectations.

Tims it has been held that a sister had an insurable intei’est in the life of her brother, where, the. fact was that she had been supported by him, Lord vs. Dall, 12 Mass. 115, and a father in the life of his minor son, 'because entitled to his earnings, Mitchell vs. Un. Life Co., 45 Maine, 104; but. that he has none from mere relationship to a son, Halford vs. Kymer, 10 Barn. & Cres. 724; nor does the mere relation of brother suffice to furnish an insurable interest, Lewis vs. Phenix Co., 39 Conn. 100.

It must be admitted that the courts are not in accord upon the kind or quality of the insurable interest. Sometimes statutory law has intervened and prescribed in general term’s what is insurable interest. We have no statute on the subject, and therefore are not hampered by special restrictions, but are at liberty to apply' the general principles that underlie the whole system of insurance law.

Rombacb was in none of the categories of permissible insurers. He bad no insurable interest in the life of his mother-ih-law. This is conceded by his counsel, but inasmuch as he is natural tutor to his child, who is the grandchild of Mrs. Seisler, it is claimed that the relationship of plaintiff by affinity to the deceased, and by blood to his own child, and the latter’s relationship by blood, as a forced heir, to both his father and grandmother, does constitute a substantial insurable interest.”

This lengthened tie long drawn out is too attenuated to support a policy of insurance. ■ '

Besides, the policy on its face expresses that it is for his sole use. If he had died, and the policy' was collectible, it. would have enured to the benefit of his succession—to his creditors exclusively, if he had died insolvent.

Judgment affirmed. .


author: Bermudez, C, J.

text:
    No. 8801.
    The State of Louisiana ex rel. Moses, Lobe & Co. vs. W. T. Houston, Judge, etc., et als.
    A prohibition does not lie to arrest the execution of a judgment rendered by a oourt vested ■with jurisdiction over the subjeot matter.
    A suspensive appeal from a judgment dismissing, on exceptions, the intervention of an adju. . dioatoe contemplating the erasure of mortgage inscriptions, does not strip the oourt of jurisdiction over a demand to ooeroe payment of the price of adjudication retained by suoh adjudioateo at a judicial sale.
    Where the judgment rendered is erroneous and aggrievos the adjudioatoe and is suoh as oould not have boon legally rendered without nobioe to him, and he was not properly made a party, tho law does not leave him without a remedy to suspend or arrost the execution of suoh judgment.
    The writ of prohibition is not designed to stay the enforcement of suoh judgment.
    Application for a Prohibition.

      22. 22. Mo'ise for tho Relators.
   The opinion of the Court was delivered by

Bermudez, C, J.

This is an application for a prohibition.

The complaint is that the District Judge, after granting a suspensive appeal from a judgment dismissing an intervention by tho relators, has illegally assumed to render against them, without any notice to them, a judgment for a large amount, which tho sheriff is about to execute.

The charge upon which the complaint rests is, that the matter at issue in the intervention is the same as that involved in the proceeding in which tho money judgment was rendered. Hence, it is argued that the District Judge, having been stripped of jurisdiction in the first case, by the suspensive appeal obtained, was divested of all authority to adjudicate in tbe second proceeding. Consequently it is urged that he has usurped a jurisdiotion which belongs to tills Court, and that he should be restrained from enforcing the judgment complained of.

The relators filed the intervention to which reference is made, as adjudícateos of certain real estate sold to foreclose a mortgage via executiva. They substantially averred in it that the property was sold them for $67,000, of which they paid $10,000 to the sheriff, retaining the difference; that they propose to deposit that difference as the Court may direct, in order to obtain the cancellation of all mortgage and other inscriptions against the real estate to them adjudicated by the sheriff. They prayed for relief accordingly.

On exceptions this intervention was dismissed, and from this judgment of dismissal the relators have obtained a suspensive appeal, returnable to this Court on the third Monday of February, instant, ou giving bond for one thousand dollars.

The judgment subsequently rendered and complained of, directs the sheriff to collect $21,847.53 from the relators; out of the difference between the sum paid by them to the sheriff and the amount of adjudication. Under that judgment the sheriff demands the amount; which relators refuse to pay him, on the ground that the judgment is a nullity. They claim it to be such because the court was without jurisdiction to render it and because they were not made parties to the proceeding in which it was rendered!

The matter at issue under the intervention is hot the same as that involved in the proceeding in which the money judgment was rendered.

The question in the intervention was whether, on depositing the difference, $57,000, in their hands, as adjudicatees, the intervenors would be entitled to a cancellation of the mortgage and other inscriptions against the real estate adjudicated to them.

The question in the proceeding in which the money judgment was rendered was, whether the sheriff should or not collect the sum of $21,847.53 from the adjudicatees, out of the difference in their hands.

We are not told of the form of the last proceeding, and we are left to assume that the judgment is responsive to the issue presented under it. C. P. 689.

■ It is manifest that a judgment in one case would not constitute res judicata in the other. Hence, the matters invoked in the two proceedings are not identical and the appeal taken from the judgment on the intervention, contemplating an erasure of mortgage, inscriptions, did not divest the court of jurisdiction over the proceeding to coerce payment of part of the price of adjudication.

It is possible that the money judgment rendered in that last proceeding should not have been rendered without previously affording the relators, if they were necessary parties, an opportunity to be heard, or that it is otherwise incorrect; but it surely cannot be assailed because the court had no jurisdiction to render it.

Whatever may be the effect of the suspensive appeal from the judgment dismissing the intervention, it cannot certainly be claimed that the appeal has stripped the District Judge of jurisdiction over a demand, founded or not, to compel the adjudicatees to pay, either the whole, or part of the balance of the price of adjudication in their hands. It would indeed be a convenient but unauthorized mode, on giving a bond for one thousand dollars only, to put off the payment of fifty-seven thousand dollars in capital, judicially admitted to be due. By such device purchasers would be authorized to keep both the property and the price.

If the money; judgment which the sheriff seeks to collect from the relators be erroneous., one which aggrieves them, and one which could not be rendered without their being made parties, and they were not made such, the law does not leave them without remedy, either to suspend .or annul its execution.

The writ of prohibition was not designed as the remedy in a case like that now presented.

It is, therefore, ordered and decreed, that the application be refused, with costs. • ' . •


author: Manning, J. Fenner, J. Manning, J.

text:
    No. 7864.
    Mrs. M. B. Woodhouse and Husband vs. The Crescent Mutual Insurance Company et al.
    A corporation is the custodian and trustee of the corporate funds, property, and stock, for th o. stockholders; is bound to employ competent andfaithful.transfer agents; and responsible to the stockholders for any negligence or fraud of such agents, to their injury.
    In case of illegal and unauthorized transfer of stock to a third person, the injured stockholder may contest the title of the transferree, contradictorily with both the latter and the corporation ; but he is not confined to this remedy ¿ It hasbeen frequently held that h© may sue the corporation alone for the value of his stock illegally transferred.
    Under Art. 2997, the mandate to sell must be “ express and special,” which has been often held to mean the converse of implied and general. • * *’
    The attempt to imply authority to sell fcom'obher acts of agent of -a different character, done without authority and yet approved by principal, is in the very teeth of the Code. Mbr do such facts operate as an estoppel.
    Under the facts of this case the corporation permitted the transfer of plaintiff’s property illegally and. without authority from her, and is liable for its value and for dividends unlawfully divested, • • • ;
    APPEAL from the Fifth District Court for the Parish of Orleans; Moyers, J.

      J. O.'Éixon, Jr. for Plaintiff and Appellant: • ■
    1. The power to sell must be express and special. C. C. 2*297.
    2. There was no negligence on the part Of plaintiff in leaving the certificate of stock with Allen, ‘ Bank of Ireland vs. Evans, 32 English Law- and Equity Report,-28; Loring vs. . Salsbury Mills, 125 Mass. 138.
    3. There is no circumstance in the record that amounts to an, implied authority to sell, even if Such authority were valid.
    4. To protect a person dealing with one who claims to act as agent of another, it must be shown that the alleged principal did some act known to the person so dealing, and upon which he has relied as showing an authority by the alleged principal. Story on Agency § Í33. _
    5. The defendant Compauy having had exhibited to it the written power to Allen,- and that power not giving the power to sell, it was bound to inquire from Mrs. Woodhouse, as to the rights of Allen.

      6. Allen had no power to pledge the stock ,* and the pledgee as pledgee could have no claim upon tho stock.
    7. The Company having transferred the stock without authority from plaintiff and to her loss and injury, is liable for its value. 125 Mass. 138.
    If. M. Colien and Nicholls & Carroll for Defendant and Appellee :
    ^he damage was occasioned by the negligence or fault of Mrs. Woodhouse, or of her agent and not of the Company. And, “whenever one of two innocent parties must suffer the law throws the loss upon him by whose negligence or fault the damage, is occasioned.” Carpenter vs. Allen, 16 An, 437; same point, 26 An. 742; 27 An. 46 ; 20 An. 327; 4 An. 19; 3 An. 400; 13 An. 524.
    If Allen had not sold the stock to pay tho note to the Union Bank, secured by pledge of the • stock, tbe pledgee could have sold, or caused to be sold, the stock thus pledged. And if Mrs. ‘Woodhouse has a claim, it is against her agent and cousin, and thirty-year acquaintance, who pledged the stock, and not against the Insurance Company, which could not prevent him from pledging it. “ Plaintiff must pursue his unfaithful agent.” Harris vs. Cuddy, Brown & Co., 21 An. 389; ■ ' ' '
    “ The stock cannot bo transferred by relator, qxcopt upon the hooks of the respondent, and on the production of the certificates. This is sufficient protection to the Company.” State ex rol. M. Phillips vs. 1ST. 0. Gas Light Company, 25 An. 413.
    Tho stock in the case at bar was transferred “ on the hooks of the Company, and on the pro duction of tho certificate.” ' > '
   ■ Tlie opinion of -tlie Court was delivered by

Manning, J.

Tbe plaintiff alleges tbat sbe is tbe owner of thirty shares of stock of'the defendant Company of one hundred dollars each, and tbat it has' transferred them to one Mrs. Coleman without the plaintiff’s consent or authority, and refuses to longer recognise her as tbe owner of the shares and to pay her the dividends thereon. The suit is for the recovery of the value of the stock, three, thousand dollars, and a solidary judgment is prayed against the Company and Mrs. Coleman.

The Insurance Company pleads the- general issue, and specially avers that the stock was bought by Carroll W. Allen in 1876, as agent of the plaintiff, who held it until 1879, and then sold it in the same capacity ; that in this interval- Allen as agent received the dividends and transmitted accounts to the plaintiff, of which those transactions formed apart; that Allen’s agency was not confined to this matter, but he leased her property in New Orleans, collected her rents, invested those rents for her, etc., under a power of attorney, and that all these ci'rcufiistances justified the Company in treating Allen as her agent with full power to sell the stock.

■ Mrs. Coleman answered that she purchased the stock, paid for it. now owns it, and knows nothing of the plaintiff or her agent, or of their affairs.

•The issues were submitted to a jury, who found for the defendants, and there was judgment accordingly. . . ' -

The plaintiff lives at Brownsville, Texas, ami owns a house and lot in New Orleans. By notarial act dated Oct. 28, 1875, she made Allen her agent with full power and authority to borrow money, to draw and endorse notes for money so borrowed, and to mortgage her property to secure their payment. He bought the stock of the Insurance Company with money obtained from a mortgage upon her property, executed by him in 1876. The stock was entered upon the books of the Company in her name. He collected the dividends and accounted to her for them. His accounts, transmitted to her, contain entries of these and other business matters. He does not appear to have had any special airthorization to buy stock, or to sell stock, or to make any other investment, nor even to collect her rents, nor to lease her house. But he did all these things, and she received and approved his accounts of them, and ratified them. There was never any intimation of disapproval. On the contrary, she evidently thought this was precisely what he was agent for. Certainly this was his chief business as her agent.

Allen made a note for $4,400, as her agent, and pledged the insurance stock as collateral to secure its payment. At the maturity of the note he sold the stock and with the proceeds paid it. This was done in June, 187,9. A broker purchased the stock for Mrs, Coleman, and the transfer on the Company’s hooks was made to her. Allen had held the stock certificates during the three years Mrs. Woodhouse owned them. She never saw them.

. It is very clear that Mrs. Coleman owes the plaintiff nothing, nor do we think the Insurance Company is liable. The power of attorney authorized the agent to borrow, to execute notes, and to mortgage property. Allen therefore had authority to make the note, to secure which the stock was pledged. If Allen had not paid the note the pledgee could have caused the stock to be sold. Allen did that which could have been compelled by legal proceedings. He sold without the intervention of the law, and Mrs. Woodhouse’s obligation was extinguished.

Outside of the power of attorney he was the manager of her affairs here. The stock was sold to him as her agent, and the Company’s books contained the transfer to him in that capacity. To him the dividends of three years were paid, the stock certificates being in his possession all the while, and these certificates were produced by him when the sale was made, and were surrendered. If he was without authority to sell, and loss ensued to the plaintiff, the damage should-not be repaired by the Company, who was induced by her own acts to treat her agent as she had treated him herself. When one of two innocent persons must suffer the law selects as victim that one who occasioned the loss by his own fault or negligence. Frosten vs. Legendre, 8 Ann. 400; Walker vs. Cassaway, 4 Ann. 19; Florat vs. Marchand, 26 Ann. 741; Malian vs. Dubuclet, 27 Ann. 45.

The plaintiff’s counsel lays stress upon the fact that Allen exhibited his power of attorney when the stock was sold and was about to be transferred, and the Company had but to inspect the instrument to ascertain the absence of authority to sell the stock or any property. But it is manifest that under that power he had not authority to do any act he had done in the general management of her business—no authority but to borrow, sign notes, and mortgage—yet all his or her business with the Company had been done by him with her approval, and she had not only held him. up to the Company as her agent, but he was in fact such, and her testimony exhibits her entire satisfaction with his management until after this sale.

Judgment affirmed.

On Rehearing.

The opinion of the Court was delivered by

Fenner, J.

Under stress of well established principles and authorities we feel constrained to reconsider our original opinion and decree herein.

The statement of facts presented in the original opinion is substantially correct, and we refer to the same.

The plaintiff sues the defendant for the value of thirty shares of stock owned by her, which she alleges the Company unlawfully transferred to a third person without her authority.

The Company affirms the transfer and defends the action on the ground that the transfer was lawful and authorized.

I.

The objection made in argument to the remedy invoked by plaintiff is not well founded. She was not bound to sue to annul the transfer and demand the restoration of the stock. The corporation is the custodian and trustee of the corporate funds and property and stock for the stockholders. It is bound to employ competetent and faithful transfer agents, and is responsible to the stockholders for any negligence or fraud by such agents to their injury. When stock has, by the fraud or negligence of the corporation or its agents, been permitted to be unlawfully transferred to a third person, without authority of the owner, the latter may, indeed, contradictorily with both the corporation and the transferree, contest the title to the stock and demand its restoration. But he is not bound to take this course. He may sue the corporation alone for the value of his stock illegally transferred. This last remedy has been frequently recoguized and affirmed. Factors’ & Traders’ Ins. Co. vs. Marine, 31 An. 149; Sewall vs. Boston, 4 Allen, (Mass.) 277; Pollock vs. National Bank, 3 Seld. (N. Y.) 274; Albert vs. Savings, 1 Md. Ch. 407; Loring vs. Salisbury, 125 Mass. 138; Gray vs. Portland, 3 Mass. 385.

II.

Under Art. 2997 Rev. C. C., the mandate to sell must be express and special.” This Article has been frequently interpreted by this Court to mean “ express and special,” as distinguished from implied and general. Cuny vs. Roberts, 16 La. 180; Nalle vs. Higginbotham, 27 An. 477; Nugent vs. Hickey, 2 An. 358; Ducongé vs. Forgay, 15 An. 37; Robertson vs. Levy, 19 An. 327; Gribble vs. Haynes, 22 An. 141.

It is not pretended that Allen had any express and special authority from plaintiff to sell this stock, nor that she ever ratified his action in selling. On the contrary, as soon as she was notified thereof, she repudiated it.

The attempt to imply authority to sell, from the fact that Allen had done various other acts for plaintiff without special authority and yet approved by her, is in the very teeth of the requirement of the Code.

III.

No principle of estoppel applies in this case. Unless by some act in connection with this very sale, she could not be estopped from her legal right to dispute his authority to make it, when his legal iiower to do so was entirely wanting, nor could her ratification of other unauthorized acts of a different character bind her to ratify this. Young vs. Grote, 4 Bing. 253; Bank of Ireland vs. Evans, 32 Eng. L. & E. 28.

But, aside from this, it does not appear that the Company was aware of, or misled by many of the various acts of Allen now set up in defense. Its own books show that it dealt with Allen, in the matter of this transfer, simply on the faith of a written procuration exhibited by him at the time, and which did not include the power to. sell. The element of misleader, essential to estoppel, is entirely wanting,

IV.

There was no fault or negligence whatever on the part of plaintiff iu leaving the stock certificate in tiie possession of Allen. The certificate was in her individual name, not endorsed or assigned by her, and informed the Company and all persons that the stock belonged to her and could not be sold or disposed of without her authority.

In one case already quoted, where the certificate was in the name of a trustee for the benefit of a cestui que trust known to the corporation, a transfer by the trustee without the cestui's authority was held no bar to tlie latter’s action for the value of the stock. Loring vs. Salisbury, 125 Mass. 138.

Y.

It appears that in 1875, several years prior to these transactions, plaintiff had given Allen a special notarial procuration to borrow money and make notes for and to secure the same by mortgage on certain designated property. The special purpose of the act is sufficiently apparent on its face; yet it contains general expressions relative to tlie power to borrow aud to make notes, and had never been revoked. Allen, long afterwards, borrowed money from the Union Bank, made a note therefor as agent for Mrs. Woodhouse, and pledged the stock for payment thereof.

So far as the pledge is concerned, he wras utterly without authority to make it, and it was without any effect as against Mrs. Woodhouse or her stock.

As for the note, the evidence shows that Allen borrowed the money for his own purposes, at a time when he had money of plaintiff in his hands and when the loan was not required for any purpose of hers ; though Allen claims that some undefined part of it was used for her benefit; but the evidence is vague and uncertain, and no such defense is made in the pleadings.

It is not shown that the defendant corporation had any knowledge of this note or pledge at the time of the transfer, but it is contended that, as Allen used the proceeds of the sale of the stock, in taking up this note, they enured to her benefit and, therefore, bar her action.

It is possible that these facts might have furnished an equitable basis for a demand in reconvention against the plaintiff, and even yet for a separate action; but they offer no justification for the illegal transfer of her stock and no defense to her action for its value.

The pledge being null for want of authority, the holder of the note had no lien or claim on plaintiff’s stock. Whatever right he might have against her personally could not have been satisfied by the unauthorized and extra-judicial sale of her stock and appropriation of the proceeds, but must have been urged judicially and subject to all legal defenses. If the defendant Company be equitably or legally subrogated to such right, it must be enforced in the same manner.

We cannot adjudge plaintiff to be liable on such note, without de-‘ mand to that effect and without opportunity of defense, which, as sufficiently indicated, may be serious. The sole question at issue here is the liability of the defendant for the illegal and unauthorized trans- . fer of her stock; and, as we have shown, that question must be solved in favor of plaintiff.

We perceive no conflict of equities in the case. The plaintiff has suffered enough at the hands of this unfaithful agent. She has been guilty of no fault or negligence excusing, in any manner, the action of defendant; while the latter has been guilty of the grossest negligence, for the consequences of which it must justly respond.

As a matter of course, the demand against Miss Coleman is without foundation.

We shall take.as the value of the stock at the date of the sale, which is the value claimed with interest, the price at which it was then sold, viz : 81$ dollars per share, aggregating $2445.

It is, therefore, ordered, that our former decree herein be annulled and set aside.

It is now ordered, adjudged and decreed, that the judgment appealed from be anhulled, avoided and reversed; and that there be judgment in favor of plaintiff and against the Crescent Mutual Insurance Company for the sum of two thousand four hundred and forty-five dollars, with legal interest from June 29th, 1879, and costs in both Courts; and that the demand against Miss Coleman be rejected.

Dissenting. Opinion.

Manning, J.

Mrs. Woodhouse empowered Allen to borrow money in her name, to sign notes therefor, to execute a mortgage to secure them, and to do all other acts needful in the premises. He borrowed money in her name, signed a note therefor, executed a mortgage upon her real estate to secure it, and that note was unpaid at maturity.

In his general management of her business he had bought for her the stock of the defendant Company, and sold it. He used the proceeds of that sale for her benefit by paying with them a part of her mortgage note. She ratifies the purchase of the stock by claiming it as her own in this suit, and repudiates the sale of it, although the proceeds had been used in part in extinguishing pro tanto her debt. It is against equity and good conscience that she should be permitted to do so.

Allen held the certificate of insurance stock. She had never seen it. He sold it as he had bought it, without her knowledge, and as her business-man. The defendant derived no benefit from the one act, nor the other. It cannot be disputed that the mortgage note bound her and her property. The sale of the stock relieved that property, and released her pro tanto. Yet she retains that property, and now gets what the stock was worth.

■ It was hinted orally at bar that' her agent had gone to the bad, but so far from suffering for his unfaithfulness she is benefitted, and the defendant is punished for a sin that is not of its commission.

I cannot sanction a judgment that effects that result.


author: Todd, J. Poché, J.

text:
    No. 8671.
    The State of Louisiana vs. The Herdic Coach Company.
    Wherein a proceeding on the part-of the State to have declared by judicial decree the forfeiture of the charter of a private corporation, on the ground of a fictitious issue of stock and insolvency, and the appointment of a liquidator is asked for, and ,'ur injunction obtained restraining the liquidators appointed by the Company from disposing of the property of tho Cotupanv or settling its affairs, a judgment dissolving the corporation, forfeiting its charter and recognizing the liquidators appointed by the Company and authorizing them to act and dissolving the iuj unction, will not be disturbed, in the absence of any complaint on the part of either creditors or stockholders, and the corporation is notin debt, and when it is manifest that the action of the Company's liquidators offer no just cause of complaint.
    Appeal from the J. Civil District Court for the Parish of Orleans.

      J. 0. JEgan, Attorney General, and Geo. L. Bright for Plaintiff and Appellant

      W. S. Benedict for Defendant and Appellee.
   The opinion of the Court was delivered by

Todd, J.

This is a proceeding on the part of the State through the Attorney General to procure a dissolution of the Herdic Coach Company and a forfeiture of its charter by judicial decree.

The petition charges substantially :

That the said Company or corporation had issued, in violation of law, fictitious stock, and without requiring money for said stock; that it had suspended payment of its debts and was insolvent; that certain persons named were acting- as liquidators of the Company and disposing of its property to the injury of its creditors and stockholders.

The prayer of the petition was that judgment he rendered dissolving the Company; that a liquidator he appointed to collect its debts, receive its assets and liquidate its affairs, and that an injunction issue lestraining the Company, its officers, employees and acting liquidators from managing and administering its affairs or disposing of its property.

The injunction asked for was granted.

■ A motion to dissolve the same was filed, which charged, in substance, that the allegations in the petition were untrue, and that there was no cause of law or of fact existing that would authorize the issuance of the writ.” This motion being overruled, the defendant answered by a general denial and a reiteration of the grounds of the motion for the dissolution of tho injunction, which were made part of the answer.

There was judgment dissolving the Company and decreeing a forfeiture of its charter and recognizing the liquidators appointed by the Company and authorizing them to liquidate its affairs, and dissolving the writ of injunction.

From this judgment the State appeals, and complains of that part of the decree which recognizes the liquidators appointed by the Company and dissolves the injunction.

It is contended on behalf of the State that there was no authority in the court to appoint or recognize a liquidator or liquidators. That such appointment could only be made by a court where the charter of a corporation w7as forfeited by reason of insolvency, and that this proceeding was instituted under Sec. 1612 of the Revised Statutes, which provides that, in the event of the forfeiture of the charter of any corporation by a decree of court, the Governor shall appoint a liquidator.

Art. 238 of the State Constitution provides : No corporation shall issue stock nor bonds except for labor done or money or property actually received, and all fictitious issues of stock shall be void; and any corporation issuing such fictitious stock shall forfeit its charter.”

It is admitted that there was in this instance such fictitious issue of stock, and the correctness of the decree declaring the forfeiture of the charter for such cause is not questioned.

It is, however, shown that the corporation is not insolvent, as charged; that it had never suspended payment, but, on the contrary, that it does not owe a cent.

It also appears that the stockholders of the concern before this proceeding was instituted, as authorized by law and under a special provision in the charter of the Company, had dissolved the Company and entrusted the liquidation of its affairs to three liquidators selected by them, who proceeded to effect such settlement, which was pending when this suit was brought.

It is not shown that there is any complaint on the part of any stockholder, on account of said proceedings or the action of the liquidators, and, as stated, there are no creditors to complain.

Under this state of facts, even if the charter of the Company could have been properly forfeited for the special cause assigned, we see no reason why the liquidators appointed by. the Company should not bo permitted to wind up its affairs in the mode adopted by all the parties in interest and why a liquidator should now be appointed by the Governor to interfere with its liquidation and remove the assets of the Company out of the hands of those chosen to administer them.

Section 1622 of the R. S., under which this proceeding purports to have been instituted, was evidently framed for the purpose of protecting the rights of creditors or stockholders of corporations whose charters have been decreed forfeited. This is evident from the language of the Section, which, after providing for the appointment of a liquidator by tiie Governor, proceeds to declare that such liquidator is “ to take charge of and liquidate the affairs of the corporation, as in case of insolvencies of ■individuals.'1'1 Aud it does seem to us to do violence to the spirit of the statute when there is no insolvency, no debts, and in the absence of all complaint from the stockholders or others interested, that the right to settle its affairs through its own liquidators should be denied the Company, and its property and assets should be wrested from its liquidators and put into the hands of an appointee of the Governor. We cannot imagine how such a proceeding could afford protection to any one having an interest in the stock or property of the corporation ; or how, in view of the voluntary action of the stockholders and the perfect security to their rights guaranteed by such action, and the absence of all debts, this proceeding of the State could 3>e sanctioned, except apon the hypothesis that with the forfeiture of tire charter there followed a forfeiture also to the State of all the property aud assets of the Company. A proposition which, it is needless to say, is wholly untenable and not likely to be advanced.

Under the state of facts presented, the Judge a quo, whilst by his judgment declaring the charter forfeited, declined to disturb the settlement pending of the affairs of the Company and to remove the' liquidators selected, or to interfere with their proceedings. For the reasons assigned.above, we think his conclusions correct.

Judgment affirmed with costs.

Dissenting Opinion.

Poché, J.

In my opinion, that- part of the judgment appealed from which dissolved the injunction obtained by the State and recognized the liquidators appointed by the Company is glaringly erroneous, and should have been reversed.

Under our law, the unavoidable legal effect of the judgment of forfeiture was that the Company’s affairs should have been liquidated by a commissioner appointed by the court, whose administration should have been guided by the court, and enforced by oath and security ; or by a liquidator appointed by the Governor.

The first mentioned mode of liquidation takes place when the forfeiture of the charter is predicated on the insolvency of the corporation. (R. S. Sec. 688.) The latter must be ordered when the forfeiture is decreed for any other reason. R. S. Sec. 1612.

In either case, and whenever the charter is forfeited by judicial action, the clear intention of the law is to deprive the corporation of the power of self-liquidation, and to place its assets under the control of the State authorities, for the benefit of creditors or stockholders, as the case may be.

In this case, it appears from the record that the forfeiture of the defendant’s charter was predicated on its wanton violation of the organic law of the State, Art. 238 of the Constitution, by issuing- fictitious stock, in consequence of which the State had the manifest right of controlling the liquidation of its affairs.

It is perfectly immaterial that the corporation is shown to be solvent, and that no complaint is made by any stockholder.

The State aloné has the authority to judicially demand the forfeiture of a charter created by itself. In re Mechanics’ Society, 31 An. 631.

When the State acts through its proper representative, the Attorney General, the act is complete, without the assistance or co-operation of any party in interest. Without the intervention of the State no judicial forfeiture of the charter can be obtained, even if demanded by the stockholders themselves, or by any number of creditors or other persons in interest. State vs. Atchafalaya, 5 R. 63. These views are recognized by ourselves in the opinion in the case of the Louisiana Savings’ Bank, to be read this very day.

• A judgment of forfeiture of the defendant’s charter, for violation of the law, is absolutely incompatible with the recognition of the authority of liquidators appointed under the provisions of the charter ; that part of the judgment practically defeats the effect of the judicial forfeiture of the charter, which means nothing else than a liquidation under the authority of the State. State vs. Haynes, 12 An. 285.

For those reasons I dissent from the opinion and decree of the majority of the Court in this case.

Rehearing refused.


author: Fenner, J.

text:
    No. 8739.
    The State of Louisiana ex rel. W. G. Wyly vs. The Judge of the Eighth District for the Parish of East Carroll.
    A Mandamus is the proper remedy to compelan inferior Judge to sign bills of exceptions properly taken and tendered for signature, and, under the circumstances of this case, the mandamus is granted.
    Application for a Mandamus.
    The Relator in propria persona.

      J$. J. Delony, the Judge Respondent, in propria persona.

   The opinion of the Court was delivered by

Fenner, J.

The substantial averments of relator’s petition are : that he was the attorney of record for the plaintiff in certain designated suits and had rendered services therein ; that he had been employed .by said plaintiff under a contract stipulating that his fee was to be contingent on success and to consist in a proportion of the advantage gained thereby; that, by the effect of said contract, plaintiff had no power to compromise or dismiss the suits without relator’s consent; that, nevertheless, on a certain day, in open court, the said plaintiff, against relator’s will and consent, moved to discontinue said suits; that relator opposed said motion and averred his desire to intervene in th.e suits, and stated that he had already prepared his interventions and that they were at his office, near by, and requested.a delay of fifteen minutes, in order that he might fetch them from his office and file them, or apply to file them, and have the court to pass upon such application ; that the Judge refused to grant him any delay whatever and allowed the instant discontinuance of the suits; that relator then and there excepted to the ruling of the court, and prepared and tendered, on the same day, his bills of exceptions, which the Judge refused to sign; that he has taken suspensive and devolutive appeals from the judgments of discontinuance and is entitled to have his bills of exceptions signed; and he asks a mandamus ordering the defendant Judge . to sign the same.

The Judge, in his answer, sets forth three grounds of defense to the application, viz:

1. That his action in refusing to allow relator delay to file interventions was a matter within his judicial discretion, and not subject to appellate review.

2. That his action in dismissing the suits on motion of the plaintiff therein in person was not such as relator, as attorney, could object to.

3. That the bills of exception presented did not contain and set forth a true statement of the facts and had not been submitted to the adverse party.

So far as the first two grounds are concerned, they are obviously no justification for refusing to sign the bills of exception, whatever force they may have as reasons for sustaining the Judge’s ruling.

As to the third ground, if the statement of facts contained in the bills was not correct, it was the privilege of the Judge to make a true statement. C. P. 489. The answer does not dispute that the application for delay was made and refused, or that the discontinuance was allowed, in despite of relator’s objection. If the rulings were made and objected to in proper time, relator had the right to except thereto and to have proper bills of exception signed.

The objection that the bills had not been submitted to the adverse party is without force, unless the Judge, on their being tendered, required that to be done before signing, which is not alleged. Such a requirement would have been proper under Art. 489, C. P., and, if nob complied with, would have brought this case within the authority of State ex rel. d’Hemecourt vs. Judge, 13 An. 484. But in the absence of such requirement made at the time, and in the presence of the other defenses in the answer indicating that-the Judge was unwilling to sign any bills at all, we think the objection cannot avail.

- Mandamus is the proper remedy in such a case. . C. P. 899, 900; State ex rel. Mullen vs. Judge, 32 An. 1043; State ex rel. d’Hemecourt vs. Judge, 13 An. 484; Broussart vs. Frahan, 3 Mart. 714.

We shall, by our decree, reserve all rights of the respondent.

It is, therefore, ordered, that the writ of mandamus herein be made peremptory, without prejudice, however, to the right of respondent to require the bills of exception to be exhibited to the adverse party befo.re signing, and to correct any errors in the statements contained in said bills.


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    No. 8352.
    Pierre Samorini vs. Widow A. Mallard.
    In an action for-the dissolution of a lease amounting to four hundred and fifty dollars, an allegation that plaintiff has been damaged in the sum of ten thousand dollars for the alleged violation of defendant’s agreement to renew the lease at its expiration, and a prayer for such damages, will not be considered as an element in ascertaining the real amount íd dispute in the.suit.
    A claim for fictitious damages cannot give jurisdiction to the Supreme Court in an action for the dissolution of the lease.
    APPEAL from the Civil District Court for the Parish of Orleans. Houston, J.

      Alf. Philips and Ohs. Louque for Defendant and Appellee.
   The opinion of the Court was delivered by

Pociié, J.


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    No. 8044.
    John A. Blaffer et al. Commissioners, etc., vs. The Louisiana National Bank.
    An exception to the capacity of the plaintiffs to sue as liquidating commissioners of a hank comes too late after answer has been filed. It must be pleaded before issue joined.
    A settlement made by two banks through the Clearing House, in which checks aro xrresented and exchanged, and a balance between them is struck, will be final and conclusive if either fails to give notice of inability to meet the balance against it on tbe general adjustment, before the hour when banks usually pass checks to the credit of their depositors. The mutual credits thus given cannot be recalled by either one to tbe detriment of the
    APPEAL from the Fifth District Court for the Parish of Orleans. Sogers, J.

      Singleton & Brmvne and E. TF. Huntington for Plaintiffs and Appellants :
    On the Exception.
    .1. "We have shown that the exception filed is a peremptory exception as to form and must be filed in limine litis. It (J. P. 344-5.
    2. That an exception denying the capacity of the plaintiffs«to stand in judgment must be pleaded in limine litis. 12 La. 618; 6 Rob. 484; 11 Rob. 7; 19 La. 429; Act 1839, Sec. 23, p. 192; 3 An. 150; 3 M. 373; 2 bT. S. 389 ; 5 bf. S. 343; 1 La. 113-283; 14 La. 328; 7 La. 181; 2 An. 1017; 5 An. 332; 5 La. 40.
    3. That the charter of a corporation established under the laws of this State may be declared forfeited at the suit; 3 st, of the State; 2d, at tbe suit of a creditor; 3d, at the suit of the Auditor of Public Accounts; and. its assets placed in the bands of commissioneis, to be administered as insolvencies of individuals, without regard to the solvency or insolvency of the corporation. R. G. C. 447; R. S 284.
    4. That tbe charter of a corporation may be declared forfeited when it abuses its privileges or refuses to accomplish the conditions on which such privileges were granted, in which case the corporation becomes extinct by the effect of the violation, “ ipso facto ” of tbe condition of the act of incorporation. R. C. C. Ait. 447; R. S. Sec. 284; 13 La. 497.
    5. That a definitive judgment cannot be attacked collaterally. That “ definitive judgments may he revised, set aside, or reversed : 1. By a new trial. 2. By appeal. 3. By action of nullity. 4. By rescission.” R. C. P. 556.
    On tiie Merits.
    6. The checks of the Mechanics’ & Traders’ Bank could not be ifieaded in compensation by defendant, because defendant did notown them; that they belonged to the depository and they were not parties to the suit. R. C. G. 22( 7-8.
    7. I hat defendant did not acquire the checks on the Mechanics’ & Traders’Bank, (if indeed it has e'er acquiied (hem) which is denied, it did not do so until after the declared insolvency of the Mi chanics’ & Traders’ Bank and, therefore, defendant cannot plead them in compensation. 1 N. S. 48; 6 bT. S. 66; 2 La. 84 ; 6 An. 587; 23 An. 36, 60, 112.

      Miller di Finney for Defendant and Appellee :
    A decree of forfeiture of the char ter of one of the free banks, under Section 284 of Hie Revised Statutes, must be based u|ioii an act of insolvency alleged of record, to give jurisdiction in a suit biought by a creditor of the bank, and there must be proof of the alleged facts.
    The non-payment of a check is not made an act of insolvency by the free banking act, nor is it an act of insolvency on geueral pi inciple.s; there are often defenses for non-pa^ meut of checks, and wher e none exist the us-ual consequence is an action of damages by the depositor or check holder, not more. Morse on Banks and Banking, pp. 529, 522, 523, 524.

      Henoe, a petition forth© forfeiture of the charter of a free bank, which merely alleges the non-payment of a check, exhibits no act of insolvency, and no cause for the forfeiture, . within tho scope of tho statute.
    No admissions in an answer filed by tho counsel for the bank can serve as tho basis for the dooreo of forfeiture ofits charter, if allegations in the petition not denied are to be deemed admitted, (5th Robertson, 63) then the question is on the sufficiency of those allegations.
    And if the deoree of forfeiture is void, the appointment of Commissioners to wind up the Bank, based on that deoree, also .falls.
    Peremptory exceptions to the absolute want of capacity of plaintiff to maintain the suit, based upon the nullity of the judgment appointing them, may bo pleaded at any time, even after default. See Code of Practice, Articles 345, 346 ; Brown vs. Saul, 4th Martin’s New Series, p. 434; Tarleton vs. Kennedy, 21 An. 501; 2d Heuuen’s Digest, p. 1167, § 2.
    When two banks hold checks against each other, deposited by and ci edited to their respective customers, compensation takes placebetween them up to the amount they each hold, from the time that each hank aocepts as offsets the checks on it held by the other.
    It follows, too, that the credits which each bank has given to its customers, based upon checks received on deposit drawn upon another hank, become final, and cannot be revoked . after the bank on which tho checks are drawn has accepted and treated the checks as offsets against the checks it holds on the other bank.
    Nor will the subsequent appointment of Commissioners to wind up one of the banks in the least affect the compensation between the two banks, and the credits given to depositors, perfected before the appointment of the Commissioners.
    A credit by a bank to its ousfomers, based upon cheeks by them deposited, is the same as actual payment, if the cheeks are drawn on funds, and are accepted as offsets by the bank on which they are drawn against the checks it holds, for if the hank on which the check is drawn treats it as offset to its own demand, it is the same as if it had paid the check. Sec Morse on -Banks and Banking, p. 274.
   The opinion of the Court was delivered by

Manning, J.

Tlie plaintiffs sue in their alleged capacity of commissioners liquidating the affairs of the Mechanics’ and Traders’ Bank, and seek to recover $4,967.57, the amount of several checks drawn on the defendant Bank, and held by the Mechanics’ and Traders’ Bank on March 19, 1879.

The answer was filed November 3, 1879, and on the second day of the following April the defendant excepted to the capacity of the plaintiffs to sue for this, to-wit: that the .judgment of forfeiture,, under which the plaintiffs were appointed liquidating commissioners of the Mechanics’ and Traders’ Bank, is illegal, null and void, and that the charter of that Bank lias not been legally forfeited.

The exception came too late. A long.line of decisions has established that such .exception must be pleaded befoi’e an answer is filed. Harper vs. Destrchan, 2 Mart. N. S. 389; Reynolds vs. Reynolds, 12 La. 618; Cheevers vs. Burke, 19 La. 429; Parker vs. Moore, 2 Ann. 1017; the latest affirmatiou of that rule of practice being Legendre vs. Seligman, not yet reported.

' Tho litigation arose in this way. On March 18, 1879, the Mechanics’ Bank received on deposit several checks, drawn by different persons upon the defendant Bank amounting to the sum claimed in this suit. On tlie same day tlie defendant Bank received on deposit checks, drawn by various persons upon the Mechanics’ Bank, amounting to $3,700.86. Tlie defendant Bank credited its customers with the amounts of the checks deposited, as is the usual course when not notified to do otherwise.

At 9 o’clock the next morning, March 19, each Bank sent the checks it held to the Clearing House for the settlement of balances arising from deposits of the previous day. The settlement was made, each Bank receiving credit for the checks it held, and being charged with the checks held against it. The Clearing House struck the balance, and as between these two Banks the defendant was debtor to the Mechanics’and Traders’ in the sum of $1,266.71. The checks, sent that morning by the Mechanics’ to the Clearing House, were then despatched by the runner to the defendant Bank, and those sent by the defendant in like manner to the Mechanics’. This was about half-past 9 o’clock.

There were other checks on the Mechanics’ Bank, held by other Banks than the defendant, sent to the Clearing House that morning at the same hour, and when the general adjustment was made between all the Banks, the Mechanics’ was debtor to the amount of over twenty-one thousand dollars, and the manager of the Clearing House drew his check upon that Bank for that balance. This check was not paid. The manager was not apprised of its non-payment until between twelve and one o’clock, and the information came not from the Mechanics’, but from the New Orleans National, it being the Bank that held the Clearing House cheek upon the Mechanics’.'

By the rules of the Clearing House Association the hour for making exchanges is 9 o’clock A. m. Errors in exchanges, and claims arising from the return of checks from any cause, must be adjusted directly between the Banks that are parties to them, before 11 o’clock a. m. At 11.30 a. m. the creditor Banks receive the manager’s checks on the debtor Banks in settlement of the respective balances due them. Should any Bank not be able to pay the balance against it, resulting from the exchanges of that day, such Bank must inform the manager and also the other Banks of such inability on or before 10 a. ji. of the same day, and shall hold in trust until called for all checks received by it from the Banks at the morning exchange that day. As soon:as the manager is informed of the inability of any Bank to pay his check drawn, or to be. drawn, against-it- for balance, he must strike from the lists the exchanges, both debit and credit, of the defaulting inem:ber.,' and readjust the balance as though that member had not appeared for exchange on that day.

.¡‘The manager was not informed.by the Mechanics’ Bank of its ina» bility to pay the balance against it by 10 o’clock, or at all, nor did it give that information to the other Banks. In consequence of not receiving it, the defendant Bank at 11 o’clock placed the checks upon the Mechanics’, it had received the day before, to the credit of each depositor, subject to the drafts of each respectively. The reason why the Mechanics’ did not give this information to the manager was that it expected to he able to meet his chock when it should be drawn later in the day. Strenuous efforts were made to provide the necessary funds by the sale of exchange, by borrowing on collaterals, etc., all of which were unsuccessful. Then, through proceedings before, one of the courts, the regularity and legality of which is not under examination iu this case, the plaintiffs were appointed commissioners to liquidate the Mechanics’ Bank, and the sheriff took possession of its assets. Immediately thereafter, about half-past two o’clock of the same day, Blaffer, one of the commissioners, and the cashier of the Mechanics’, demanded payment of the defendant of the checks upon it, and the defendant offered to pay the difference between them and the checks it held against the Mechanics’, as ascertained by (he Clearing House adjustment that morning, viz., $1,20'6‘.7J, which was refused. This demand is said to have been made by the request of the sheriff. On the following day, March 20, the sheriff, still in charge of the Bank, received that sum from the defendant, and the sheriff paid it to the plaintiffs on May 1st following. Blaffer states that he received it, protesting against the sheriff’s action in the matter.

The judgment below was for the defendant, and we think it correct.

The Mechanics’ and Traders’ Bank knew shortly after 9 o’clock what the balance against it was on the adjustment of exchanges that day, and neither informed -the manager nor other Banks by 10 o’clock of its inability to pay it. That Bank knew that the defendant, and all other Banks which on that morning held checks on it of the previous day, would pass them to the credit of depositors by 1! o’clock, or earlier, as soon as the Clearing House adjustment was made. That was the usual course of business. The defendant conformed its action to that order of business, .in ignorance of the condition of the Mechanics’, as it might well be, since that Bank hoped and was trying to meet the manager’s check, which would be drawn later in the day on it for the balance on adjustment, the amount of which it- already knew.

Not only was the- defendant authorized, by-this silence of the Mechanics’Bank, to treat the checks it-held against that Bank as-paid, but there was express and positive action to that effect. ' The Mechanics’, at 9 o’clock at the Clearing House, tendered and'produced the checks it held on the defendant against the counter checks held by the defendant on it, thereby declaring in effect to the defendant that the checks it held were treated as paid by the like amount of cheeks upon it, and this, regardless and independent of the rules of the Clearing House. The defendant acted on that, as it bad a right to. These mutual credits could not he recalled afterwards by either one of the parties to the detriment of the other.

True, the Cleaving House rule is. when the manager is informed of any Rank’s inability to pay the balance against it, which information must be given by the crippled Bank by 10 o’clock a. m., that Bank must hold in trust all the cheeks received by it that morning' from other Banks, and the exchanges both debit and credit of the defaulting Bank are stricken from the lists, and the balances are readjusted.

That is a rule for the guidance of the manager of the Clearing House, and cannot affect, much less control, the legal consequences of a virtual payment made by one Bank to another, or settlement each with the other in the ordinary husiuess manner. Besides, the Mechanics’ Bank forfeited or waived its right to the benefit accruing from that rule by not complying with an essential requirement of it, viz: giving notice by 10 a. m. to the other Banks, and thus bringing to the knowledge of the defendant its disabled condition. Had that been done, the defendant would not have passed the several checks to the credit of its depositors. The defendant could not have revoked those credits to the prejudice of its depositors. No more can the Mechanics’ Bank, or those who claim to represent it, revoke its settlement- to the prejudice of the defendant.

Judgment affirmed.


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    No. 8643.
    Denègre & Villeré vs. Anselme Bayhi.
    Am appenl will lie from an ordor putting one in possession of an estate when there has boon no judgment to that effect. An older made ostensibly to execute a judgment will bo vacated, if it appears that no judgment, such as would, justify the order, has been rendered.
    APPEAL from the Twenty-fourth District Court, Parish of St. Bernard. Livaudais, J.

      Miller, Finney & Miller for Plaintiffs and Appellants.
    . Ji. T. Beauregard and Eg. Ghiapella for Defendant and Appellee.
   ..The opinion of the Court was delivered by

Manning, J.

In February, 1882, the plaintiffs, alleging they were lessees of the Battle Ground plantation in St. Bernard for that and the following year, and were entitled under their lease to its full use and enjoyment, and that the defendant was constantly entering upon the premises and digging up the stubble cane with the intention to carry it off, and had already dug up and removed a portion thereof, and would as they feared dispose of it to their irreparable injury, obtained an injunction fox-bidding him to do the acts complained of in future, and prayed judgment for one hundred dollars as damages.

The defendant excepted to the petition :

1. That the demand is a possessory action to which the plaintiffs are not entitled as lessees.

2. If disturbed in the enjoyment of the leased premises, that they are bound to apprise their lessor of it.

3. That the action must be brought by the owner.

4. The petition discloses no cause of action.

Upon trial of the exceptions, they were maintained, the injunction was dissolved and the suit dismissed. The judgment was signed April 21, 1882.

In June following the defendant filed amotion suggesting the judgment rendered in April, and “that the defendant has patiently and vainly awaited for a compliance therewith, and now fears of said parties’ refusal and physical existence to the execution of said judgment,” and suggesting further that an order of court was necessary to put the defendant in possession of the premises, obtained it, which accordingly issued to the sheriff. The wTrit of possession was served, and with it notices from the sheriff that on failure of the plaintiffs to deliver possession to the defendant of the estate and appurtenances described in their petition in three days, he would put him in possession thereof.

The plaintiffs prayed and obtained a suspensive appeal from this order, and gave bond for seventy-five hundred dollars, having been increased to this sum on a rule, and upon evidence shewing the annual revenues of the property wex-e considerably over a thousand dollars. •' The defendant now insists that an appeal will not lie from an order xnade in execution of a judgment. Very true, but an appeal will certainly lie from an order-, not in execution of any judgment, other requisites appeax-ing. The defendant had no judgment for the “ estate and appurtenances” of which the plaintiffs claimed to be lessees, nor any judgment for the possession thereof.

The plaintiffs had injoined him from coming on their premises, and doing acts which had caused them injury, and if continued would cause them further injury w'hich would be irreparable. His objections to their demand were that they could not mate it, but the owner of the premises must, and ,they had therefore disclosed no cause of actioxx, and these objections wex-e held good.

How such a judgment can be conceived to be legal warrant for an order to oust the plaintiffs, and put the defendant incontinently in possession of an estate, passeth all understanding. It was improvidently granted, and we are sure without due consideration of the issues by the Judge below.

The plaintiffs are manifestly entitled to relief. Therefore,

It is adjudged and decreed that the order of the lower court directing the sheriff of St. Bernard parish to put the defendant in possession of the estate and appurtenances described in the plaintiffs’ petition, is rescinded and annulled, and the writ of possession issuing thereon is vacated and quashed, and that the plaintiffs and appellants have and recover of the defendant the costs of this appeal.