author: Blanchard, J. Breaux, J.

text:
    No. 13,189.
    Widow and Heirs of J. W. Willis, Deceased, vs. Charles L. Berry, et al.
    Syllabus.
    1. Where an understanding exists that an administrator of a' Succession is, ■ in his individual capacity, to share in the profits of a purchase of property belonging to the Succession made by two other persons, who are co-owners with him in a judgment against the Succession, it is a sale in which the person who is administrator is interested, and void as being contrary to a prohibitory law.
    2. This is so even if afterwards the understanding that the administrator is to share in the profits be abandoned, and in point of fact he does not share in the same.
    On Reheajung.,
    The court, thinking it not possible to pronounce satisfactorily and definitely on the cause in the present state of the case and that in the interest ot justice, the case should be remanded, remands the case to the lower court in order that certain evidence be admitted. The evidence already admitted is to remain as now filed, other evidence is to be admitted, and judgment rendered.
    APPEAL from the Fourth Judicial District, Parish of Caldwell— Machen, J.

      J. W. Willis, for Plaintiff, Appellant.

      Andrew Augustus Gunhy, O. L. Berry and H. P. Wells, for Defendants, Appellees.

      William 8. Benedict, as amicus curiae.

    On the rehearing by Breaux, J.
   The opinion of the court was delivered by

Blanchard, J.

John W. Willis died in Jannary, 1882. At the time of his death he was indebted to Allen, Nngent & Co., commission merchants and cotton factors of New Orleans. This firm was composed of Thomas H. Allen, Perry Nugent and John B. Lallande.

Their claim against Willis had been sued on and gone to judgment prior to the death of the latter.

John B. Lallande applied to be appointed administrator of the succession of their debtor. He was appointed and qualified as such.

From his appointment in 1882 down to the present time, a period of seventeen years, he has filed but one account of his administration. This was a provisional account filed in 1886. The succession remains unsettled and no one knows how the administrator stands towards it, its creditors and heirs, in respect of the trust relation which he assumed.

The law contemplates that due diligence should be used in the settlement of the estates of dead men and that those charged with such settlement should from time to time render accounts of their stewardship. Succession of Francez, 49 La. Ann. 1739. If necessity exists for keeping successions open and prolonging their final settlement beyond the time that ordinarily might be considered reasonable, the same should be made to appear by the accounts, statements and exhibits .which it is the duty of the administrator to make to the court which appointed him.

It seems that at the time of the death of Willis but. a small amount in value of real property appeared upon the conveyance records in his name; that'a considerable quantity of such property, really his, was held by other parties under simulated titles; and that it became necessary for the administrator to institute suits to recover this property and bring the same under administration. These suits took time. So there was, in the beginning of this administration, some cause for prolonging the settlement of the succession. But we find that the suits to recover the property thus held away from the succession under similated titles, terminated favorably to the administrator about the years 1887 and 1888, more than ten years ago. Still the succession remains unsettled, though most, if not all, of its property has long since been sold.

N ay more, we find that about the year 1890 the administrator filed in the city of New Orleans, in his individual capacity, proceedings under the insolvent laws of the State, and a syndic to take possession of his property and effects and to administer same for the benefit of his creditors, was appointed. Following this he left the State permanently and has since resided out of it. Before leaving the State he should have filed a complete account of his gestión and resigned his trust.

C. C. 356, 1153, 1154, 1158; Yerkes vs. Brown, 10 La. Ann. 96; Scott vs. Lawson, 10 La. 547.

All these things are bitterly complained of, and justly so, by plaintiffs, the widow and heirs of the dead man, but in view of the fact that they have neglected to use with sufficient vigor the means provided by the law for compelling the performance of duty by the administrator, they are entitled to but scant judicial sympathy.

We feel constrained to say, however, that in the failure to give proper attention to the affairs of this estale, in the matter of its tardy settlement, in not seasonably and with legal frequency presenting accounts of his administration, and in other particulars disclosed by the record, this administrator is guilty of gross neglect of his duties under the law.

This much in passing to the consideration of the case as here presented.

The petition is unnecessarily lengthy. It covers seventeen pages of close, unspaced typewritten matter, equivalent to at least thirty pages of written legal cap. It contains a list of grievances and averments of face and other matters which have a very remote, if any bearing at all, on the immediate issue here raised, and which are more properly the subject of settlement and adjustment by proceedings against the administrator within the succession record proper, rather than by independent suit.

Among the different pieces of property'owned by J. W. Willis was a plantation in Franklin parish known as the “Myrtle Home” place, containing about 760 acres. This place was sold at succession sale and bid .in by Thos. H. Allen and Perry Nugent. Subsequently Allen died and his widow and heirs conveyed their interest to Nugent, in whom the title now stands.

Plaintiffs, one of whom sues as widow in community, the other two $s sons and unconditional heirs of Willis, deceased, bring this action to have decreed null the transfers and sales by which Nugent now holds title to the said property, and to have themselves adjudged the owners thereof.

As made up by the pleadings, defendant’s counsel in their brief state the issues of the case to be:—

“First — To annul the succession sale of the ‘Myrtle Home’ plantation to Perry Nugent and Thomas H. Allen on the 13th day of March, 1889”.
“Second — To recover damages, rents, etc., against L. C. Berry for occupation of said plantation.”
“Third — To remove Lallande from the administration.”

Plaintiffs took a non-suit bn the question of the removal of the administrator. That issue is, therefore, eliminated.

They set up in their petition that all the debts of the succession have prescribed. With reference to this, however, nothing is asked in the prayer. But had it been the answer would be, this is not a proper proceeding in which to adjudicate the question of the existence vel non of indebtedness against the succession, or its heirs, who accept unconditionally. It is uncommon, if not unheard of, to bring a suit to have it decreed that a debt is prescribed.

In their brief, deduced from the averments of their petition, they set up many grounds for the nullity of the adjudication of the “Myrtle Home” place to Allen and Nugent.

Judgment below was against them and they appeal.

Their demand for the .nullity of the sale is met on part of the widow and heirs of T. H. Allen, and on part of Nugent, first, with a general denial and averments that plaintiffs have no cause of action. Next, they set up that plaintiffs are equitably and legally estopped by their previous judicial admissions and proceedings from bringing this action, and they plead res adjudicata. They specially deny that Lallande, administrator, had any interest in 'the purchase of the property, and in bar of plaintiffs’ action they plead the prescription of one, three and five years.

In an amended answer defendant Nugent renews the exception of estoppel to the action to annul the sale of the “Myrtle Home” place on the ground that all of plaintiffs had recognized judicially the sale of the property; that Mrs. C. S. Willis, 'one of the plaintiffs, through J. W. Willis, her attorney, another of plaintiffs, had so recognized • it by claiming, in suit No. 1735 on the docket of the District Court of Eichland Parish, the proceeds thereof; and that Mrs. Willis, having previously renounced judicially the community between herself and her deceased husband, cannot now claim anything as widow in community.

Other matters of defense and in reeonvention are set up which, in the view we take of the case, it is not considered necessary to mention.

Another of defendants, C. L. Berry, filed an exception of no cause of action, and, later, when plaintiffs had taken a non-suit on the demand for the removal of the administrator, he excepted on the ground that the withdrawal of demand to destitute the administrator leaves-the succession still'under administration, and, hence, the widow and heirs arc without standing to sue for property while the succession is being administered.

Answering to the merits he avers the legality and validity of the sucr cession sale under which Allen and Nugent became the owners of the property in dispute.

This defendant had been brought into the case because of the fact that after the plantation had been adjudicated to Allen and Nugent, he had, under an arrangement with their attorney, gone upon it and cultivated it several years. His idea was to buy the place and he took possession with that understanding. But when the present suit was filed he relinquished the place to Nugent. He is sued herein for rent of the place for the years he occupied it, and for damages for unlawful possession, etc.

The other defendants, including the administrator, filed no appearance and the case as to them was tried on default.

With regard to the exception of res adjudicada, it suffices to say we find nothing in the record warranting the same so far as the attack on the adjudication made of the “Myrtle Home” place to Allen and Nugent is concerned.

With regard to the estoppel pleaded by defendant Nugent, contained in the averment that Mrs. Willis through J. W. Willis, Jr., her son and attorney, had recognized judicially the sale of the property by claiming the proceeds thereof, it suffices to say that even if this be so as to the two plaintiffs named, it does not affect the third plaintiff, James H. Willis, who, as heir, is entitled to prosecute the suit to final judgment on its merits. Nor do we find the fact to be that Mrs. Willis claimed, in the suit pleaded as estoppel, the proceeds of the sale of the “Myrtle Home” place.

With' regard to the exception that Mrs. Willis had previously renounced the community and cannot now sue as widow in community, if this be so and it is binding upon her in view of the litigation that followed and the result thereof (about which opinion is reserved), the only result would be that the residuary interest of the heirs, J. W. and J. M. Willis, in the succession of their father, would be increased, for there would be no widow in community to divide it with. Defendants have no real interest Lo urge this abandonment of the community by the widow. If she has no interest in this suit the heirs of the husband simply take her place and they are parties plaintiff.

With, regard to the exception filed by defendant Berry, that the non-suit taken by plaintiffs on the demand of their petition to destitute the administrator, leaves the succession still under administration, and, this being so, the widow and heirs are without standing to sue for the property, it suffices to say that though the succession be still under administration the eventual, probable or even possible, interest the widow and heirs have or may have in the same entitles them to a standing in court to contest the validity of the tenure by which property belonging to the succession, or that had been in the succession, is held. 48 La. Ann. 302.

If they be not entitled to claim the investiture of the title in themselves, they have an interest to bring it back into the succession to be administered according to law for the benefit of those concerned. This has been held to be so even though the succession be insolvent.

Succession of Aronstein, 48 La. Ann. 302; same case, 49 La. Ann. 1478.

This brings us to the consideration of the merits.

One of the grounds alleged for the nullity of the adjudication to Allen and Nugent is that the administrator was interested in the purchase and was to share in the profits arising therefrom, contrary to a prohibitory law.

If this be so, it is familiar doctrine that the sale and purchase are void ab iniiio.

49 La. Ann. 1478, 1539; 51 La. Ann. 1053; 37 La. Ann. 275; 36 La. Ann. 780; 34 La. Ann. 1017; Harrod vs. Norris, 11 M. 300; C. C. 1146; 33 La. Ann. 748.

There is no question that the property was legally advertised for sale under a legal order of sale, and that it was bid off by E. T. Lam-kin, agent, for T. H. Allen and Perry Nugent, at the sum of $3040.00, this being the last and highest bid and being two-thirds of the appraised value. It is equally true that Allen and Nugent figured alone as adjudieatees and that the title was made to them.

This sale took place on the 13th of March, 1889. Later, in May, 1891, after Lallande had made a cession of his property under the insolvent laws, Nugent wrote a letter to Eugene Soniat, the syndic of Lallande, in reply to one addressed to him by (he syndic, making inquiry, presumably, touching Lallande’s interest in the Willis indebtedness and property. This letter of Nugent, it seems, was filed in-the insolvent proceedings and thus made public. In this way it became aecessable and was filed as evidence in the instant ease.

This letter discloses that an understanding existed between Thos. II. Allen, Perry Nugent and Jno. B. Lallande that the latter was to share in the profits that might be made on the property bid in at the J. W. Willis’ succession sale in the name of Allen and Nugent and that of their attorney.

As the “Myrtle Home” place was part of the property so bid in, this . understanding covered it.

Of course, Lallande as one of the partners in the firm of Allen, Nugent & Co., was entitled to his share of what was realized in the way of collections on the judgment which that firm had recovered against J. W. Willis. But the “understanding” referred to was not confined to this. His right to his share of the collections on the judgment existed without any understanding. But where the judgment is used as a means of purchasing the property of the succession, as was the ease here, and an understanding is had by those-owning the judgment that all are to share in the profits of the purchase and one of those so to share is the administrator of the succession, the sale at which the purchase is made cannot stand. It is stricken fatally from its very inception by the terms of the prohibitory law forbidding those holding fiduciary trusts from being interested in any way in purchases made of property over which they have the administration.

It can make no difference that the names of Allen and Nugent only were used as adjudicatees.

If Lallande, the other co-owner of the judgment, who held the fiduciary trust, was in the least interested in the outcome of the investment the prohibitory law applies and the sale is null ab initio. A. & E. Ency. of Law, Vol. 7, p. 294. This is so even if afterwards the understanding that he was to share in the profits be abandoned and in point of fact he does not share in the same. Once the understanding existed, his interest arose and the sale is vitiated.

In Harrod vs. Norris Heirs, 11 M. 300, the court states the reason for this to be, “to prevent men from being led into temptation; that they may not be placed in a situation where their private interests and their duties to others were at variance — the law presuming that in such case the latter would be sacrificed.” See also Adams Equity, Secs. 60 and 61, and authorities there cited.

This letter in which the admission is that Lallande was to share in the profits of the purchase made at the Willis’ succession sales, was that of Nugent, who, as sole owner now of the “Myrtle Home” place, the subject of this attack, is the principal defendant herein. The letter was written more than two years after the succession sale of the property. It further disclosed that, according to the writer’s recollection, Lallande had told him the preceding summer he preferred not to have any interest in the profits since his doing so might not be legal.

This but confirms the pre-existing understanding that he was to share in the profits. When he told Nugent in the summer of 1890 that he would prefer not to have an interest in the profits, it was more than a year after the sale had taken place at which the properly had been adjudicated to Allen and Nugent.

The witnesses, other than Nugent, who testified that Lallande was not interested in the purchase of the “Myrtle Home” place, necessarily did not know of the secret understanding between Lallande and his partners, Allen and Nugent. Nugent’s testimony in the case that Lallande was without interest is contradicted by his letter to Lallande’s syndic. Lallande himself did not testify in the case.

As to the purchase of the property by Allen and Nugent, former commercial partners of Lallande and co-owners with him of the judgment against Willis which was used in effecting the purchase and payment of the price, we call attention to the case of Carroll vs. Cockerham, 38th La. Ann. 822, the facts of which are quite similar to those of the instant ease and the ruling in which sustains that herein.

Plaintiffs do not bring this suit for the benefit of the succession of Willis, or its creditors. They bring it for their own benefit, seek to have themselves decreed the owners of the property described in their petition and sent into possession thereof.

They ask for more than they are entitled to in this proceeding.

The nullity of the sales by which Nugent claims the “Myrtle Home” place must be decreed, but the property returns to the succession, whose title has never been divested — not to plaintiffs.

The succession is still under administration and unsettled. In these respects the instant case differs from that of the Succession of Aronstein, 51 La. Ann. 1052.

The prescriptions pleaded by defendants in bar of plaintiffs’ action to annul the succession sale of the property to Nugent do not apply, for the sale being in contravention of a prohibitory law was void ab initio. Title to the property never passed to the adjudicatees.

What the defendant Berry owes,' if anything, for rents, etc., is not a claim to be recovered by the widow and heirs -in this proceeding. It pertains to the succession and the administration thereof, whose rights are reserved.

For the reasons assigned, it is ordered, adjudged and decreed that the judgment appealed from be annulled, avoided and reversed, and proceeing, to render such judgment as should, have been rendered in the first instance, it is now adjudged and decreed that the sales by which the title to the “Myrtle Home” place is pretended to have been conveyed to Perry Nugent are null and void, and the said property is hereby decreed returned and restored to the succession of Jno. W. Willis, deceased, to be administered according to law. •

It is further ordered, etc., that all other questions and issues herein raised, not passed upon, are reserved to the parties plaintiff and defendant respectively — costs of both courts to be borne by defendants.

On Rehearing.

Breaux, J.

It is evident that this cause is of considerable importance. We are informed that a decree annulling the sale attacked will disturb the title by which several owners have acquired part, of the property since the date of the sale attacked. In addition, the issues are such that it is important to have all the evidence obtainable before the court prior to entering a final decree.

In argument at the bar, something was said about the testimony of the administrator of the succession of J. W. Willis, and the impossibility of obtaining it at the time. This is met by the assurance that his residence is well known and that his testimony could have been had. From one of the briefs in behalf of plaintiff we quote: “It is to be regretted that Mr. Lallande, who is still living, but who is a traveling salesman, should not have been located and questioned in regard to this matter.” Again: “It is equally to be regretted that the writer of these views to the court, whose name was mentioned in the interrogatories propounded by plaintiff, should not have been examined upon the subject matter”.

From the defendants’ brief, we quote: “If, however, the court should remand the ease, we have further evidence that Lallande now claims a part of this property.” This is shown in a letter dated at Memphis, April 10th, 1895, written by Thomas H. Allen to lion. IT. P. Williams.

In view of the condition of the issues, we have concluded to remand the case. The authority to remand is manifest when a vital question of fact may be made quite clear by further testimony. C. P. 906.

It is therefore ordered, adjudged and decreed that the decree of the District Court in this case be annulled, avoided and reversed, and that our decree also heretofore handed down, be annulled, avoided and reversed, and the case is remanded to have any and all further admissible evidence admitted and for a decision thereon by the court a qua and to be appealed from if the party cast so elects.

It is further ordered that the evidence remain as already filed and that change be made, as before indicated. Appellee to pay costs of appeal, those of the lower court are to await the final decision of the court.


source: Caselaw Access Project

author: Blanchard, J.

license: Public Domain

text:
    No. 13,433.
    Henry P. Hake vs. S. R. Lee and W. C. Beal.
    Syllabus.
    Where an appellant obtains an extension from this court in which to bring up his appeal and yet neither flies the transcript within the extended period, nor obtains, on proper showing made, a further extension of time, the appeal will be dismissed.
    APPEAL from the Fourth Judicial District, Parish of Grant— Machen, J. ■ ■ ■ .

      R. J. Bowman for Plaintiff, Appellant.

      William G. Roberts for Defendants, Appellees.
   On Motion to Dismiss Appeal.

The opinion of the court was delivered by

Blanchard, J.

Plaintiff is appellant from a ruling and judgment of the court a qua permitting defendants to dissolve on bond the injunction which had been issued restraining them from cutting the timber on certain lands.

For a statement of facts of the case, see State ex rel. Hake vs. Judge, 52 La. Ann. 104. This appeal was both suspensive and devolutive and was taken in March, 1899. It was returnable on the second Monday in November, 1899, which was the next return day fixed by-law for appeals from the parish of Grant.

The second Monday of November, 1899, was the 13th day of that month. This court had, after vacation, convened for its present term on the first Monday in November, which "was the 6th day of the month, and after holding sessions through that week had, on Saturday, November 11th, adjourned until Monday, November 20th.

So that court was not in session on the return day of this appeal, nor for a week thereafter. This had the effect of extending the time for the filing of the transcript until November 20th, the day when court was next in session, and, counting the 20th, appellant had three judicial days within which to file the appeal. In other words, he had the days of grace November 20th, 21st and 22nd in which to file it. Sec. 4, Act No. 45 of 1870 (Extra Session).

Court was in session on each of these days.

The transcript was not filed on either of the days, nor prior thereto.

Late in the afternoon of November 22nd, after the court had adjourned for the day, the appellant presented a petition, duly verified by oath, for an extension in which to file it. The next day, November 23, the court, in session, acted formally on the application and extended the time for the filing of the appeal until January 8th, 1900. See Chretien vs. Poincy, 33 La. Ann. 131; Packet Co. vs. Brown, 36 La. Ann. 138.

The transcript was not filed within the extended period, nor indeed until February 3rd, 1900; nor was any further application for an extension filed or granted, so far as this appeal is concerned.

Orders of appeal had, subsequent to the present one, been taken by plaintiff from the ruling of the trial judge dissolving, with damages, a second injunction that had been sued out, and from his judgment discharging in the present case, a rule for contempt that had been filed. But they were three separate appeals, taken at different times.

The application for extension of time heretofore mentioned as having been filed on November 22, 1899, and granted, referred to and covered all three of the appeals in the ease, to-wit: — the one presently considered, the one from the ruling dissolving the second injunction, and the one from the judgment discharging the rule for contempt. Bui the later applications for further extension covered only the last two appeals and did not include the one now before the court.

The additional extensions granted hy the court as to the appeals from the ruling dissolving the second injunction and the judgment discharging the rule for contempt saved those appeals, and it was recently so held in Hake vs. Lee and Beal, No. 13,354 on the docket of this court.

To have saved the present appeal the transcript should have been filed within the time of the first extension, or else it should have been included in the further extensions applied for and granted.

The ground for dismissal is that plaintiff neglected to prosecute the appeal, and had abandoned it, by failing to seasonably file the transcript.

The ground is good; we have no alternative, and must sustain it; no discretion to do otherwise is vested in ihe court.

Eor the reasons assigned, it is ordered that the appeal from the judgment permitting the defendants, Lee and Beal,, to dissolve on bond the first injunction sued out by plaintiff be dismissed at the cost of the appellant.

Rehearing refused.


author: Nicholls, C. J.

text:
    No. 13,389.
    State ex rel. P. C. Bulkley et al. vs. Whited & Wheless, Limited.
    Syllabus.
    Wlien all the essential elements and conditions for an absolute sale are present in a contract between parties the effects flowing legally from that contract follow whether the parties foresaw and intended them or not, and though they may refer to the contract as an agreement to sell and not a sale.
    The fact of placing the thing which formed the object of the sale and the negotiable notes, evidencing the obligations of the purchaser in the hands of a third party to be by him delivered when the parties should have complied with their obligations fully, is not indicative of a suspensive condition, but of a precautionary measure resorted to by the parties to safeguard their respective interests under the sale.
    APPEAL from the Second Judicial District, Parish of Bossier— Watkins, J.

      J. A. Snider for Relators.

      Joannes Smith and Leonard & Randolph for 'Respondent, Appellant.
   The opinion- of the court was delivered by

Nicholls, C. J.

This suit is brought by P. C. Bulkley, in his own right and as agent of his wife, Mary M. Bulkley.

In the petition filed it was alleged that- the plaintiffs had an interest in Wbited & Wheless, Ltd., a corporation incorporated under the laws of Louisiana and domiciled in Bossier parish.

That the stock of the company or corporation was thirty thousand Hollars in shares of par value of one hundred dollars each, and that relator, P. C. Bulkley, subscribed and paid for shares to the value of ■five hundred dollars; that relator, Mary M. Bulkley, subscribed and paid for shares to the amount of nine thousand five hundred dollars; that at date of incorporation, F. T. Whited and H. H. Wheless, each subscribed ten thousand dollars; that the relator, P. O. Bulldey, was president of said corporation until the first Monday of October, 1899, and had been informed that since that date F. T. Whited had -acted as president of said corporation; though to knowledge of relator no publication of such election had been made, or of the convocation of the stockholders as provided by the charter. That to their knowledge II. II. Wheless had been and was still secretary and treasurer of said corporation. That they, or either of them, had never unconditionally sold or disposed of their stock in said corporation, as was evidenced by a written document annexed.

That Mary M. Bulkley was the owner of large tracts of land in said parish of Bossier, the pine timber on part of which she sold, standing, to said corporation upon the terms and conditions writen in exhibits “C” and “D,” also annexed; that present officers of said corporation had rendered to relators statements of the timber they had cut, or alleged had been cut, from said lands of Mary M. Bulkley, but refused and still refuse to permit Mary M. Bulldey’s attorney in fact, P. O. Bulkley, to examine the books of said corporation so as to verify the correctness of said statements, or correct errors therein, as to the scaling of the timber .included and referred to in said exhibits “0” and “D.” That so far as they had any knowledge, F. T. Whited and H. II. Wheless were alike the controllers of said company and the sole custodians of the books, and that relators had made (Mary M. Bulkley through her attorney in fact) verbal and written demands of said custodians of said books of said corporation to inspect them for tM purposes heretofore alleged, and that permission to examine said books of said corporation had been absolutely and categorically refused and denied.

In view of the premises, relators prayed that “said F. T. Whited and H. H. Wheless be all and each of them cited according to law, and that a writ of mandamus issue commanding them and each of them to give relators,'P. C. Bulkley in his .own right and as attorney in fact for Mary M. Bulkley, to have inspection of the books of Whited & Wheless, Ltd., for the several purposes of examining the stock books of said corporation and for the purpose of correcting if any, of the statements referred to in the foregoing petition, and for such other purposes as are detailed herein, or show cause to the contrary, on a day and hour to be fixed by the court, and that on final hearing, said writ of mandamus be made peremptory and for all other necessary orders and decrees, and for general relief.”

Defendants excepted.

1st. That the petition showed no cause of action.

2nd. That for whatever rights plaintiffs might possess there were remedies at law, and no ground appeared for the extraordinary writ of mandamus.

Under benefit of these exceptions defendant answered.

After pleading the general issue defendants averred that they owned all the stock of the defendant company except one share held by A. E. Eakin, and that neither of the plaintiffs had any proprietary interest in Whited & Wheless, Ltd., and did not have when the alleged demand was made for inspection of the books, nor at the time of filing of the petition, but that the entire stock formerly held by them was purchased by and was then the property of defendants, F. T. Whited and II. H. Wheless, as appeared from documents annexed to petition and the letters annexed thereto. That the sum of five thousand dollars was paid in cash by defendants at the time of purchase, their notes to the order of Mrs. M. M. Bulkley, given by them in pursuance of said contract of purchase attached to plaintiffs’ petition and paid as they fell due, $2,000 in addition to the $5,000 having been paid at this time. That the said former stock of plaintiffs being now held as collateral by the National Bank of Commerce of St. Louis (as per aforesaid attached documents), could never re-invest in plaintiffs unless they became purchasers thereof.

Respondents further averred that the real and' sole object of plaintiffs in desiring to inspect defendants’ books was to attempt to manufacture a claim against the company defendant, and that instead of the application being on part of a stockholder and proprietor to conserve his or their interests as stockholders, it was an attempt of an alleged creditor, hostile to the corporation, intending to harass it with writs to attempt to fasten liabilities upon it and, necessarily, an attempt to injure and depress the interest of the corporation, its proprietors and its slock, and if allowed would be violative of Article 1 of the Constitution of Louisiana, Articles IV and V amendments to Constitution of the United States, work an invasion of their private affairs and business, and would work great damages to them. That the right to protect their said affairs and books was worth exceeding twenty-five hundred dollars to them.

That if the said plaintiffs had any claims against the corporation defendant, the laws of Louisiana furnished ample facilities for obtaining evidence, but not by the writ of mandamus.

The District Court rendered judgment in favor of the relators, P. C, Bulkley and Mary M. Bulkley, against the respondents, Whiled & Wheless, Ltd. It ordered, adjudged and decreed that the mandamus prayed for by relators be made peremptory and the board of directors of said corporation through its proper officers were ordered to afford free access to and give permission to the relators, P. C. Bulkley and Mary M. Bulkley, or to their duly authorized agent or agent of either of them, to inspect and examine all the books, records, accounts and muniments thereto appertaining and belonging to said corporation, and which relate to the business of said corporation, as an incorporated body without unnecessarily incommoding the officers and directors of said company, and also to make copies of such papers, accounts, etc., as said relators may desire, as well as memoranda in writing relative to the same.

Defendants appealed.

Opinion.

Whited & Wireless Co., Ltd., is a corporation for manufacturing and selling lumber, organized in the parish of Bossier, in 1894, with a capital stock of -thirty thousand dollars. Of this P. O. Bulkley, one of the relators, owned five shares, his wife, Mary M. Bulkley, the other relator; owned ninety-five shares, making a total of one hundred shares held by them.

The balance of the «took was held by F. T. Whited and II. H. Wheless, one hundred shares each. The stock continued in this way until July 1st, 1899, when P. O. Bulkley, for himself and as agent of his wife, entered into the following agreement:

“This agreement this day'made, this first day of July, 1899, between Mary M. Bulkley, wife of P. O. Bulkley, by the said P. C. Bulkley, her agent and attorney in fact, and the said P. O. Bulkley, parties of the first part, and H. H. Wheless and E. T. Whited, parties of .the second part, to-wit:—
“That parties of the first part have agreed to sell to parties of the second part and parties of the second part have agreed to buy from parties of the first part, one hundred shares of stock of the company, of Whited & Wheless, Ltd. (5 of said shares now standing in the name of Mary M. Bulkley on the books of the corporation) upon the follow-, ing terms and conditions:— ■
“The price to be paid for said shares is $25,000, payable as follows: $5,000 upon the execution of this agreement, the receipt of which is hereby acknowledged; $6,000 in 12 equal payments of five hundred dolí lars each, payable on or before the tenth day of each month for one year; commencing Aug. 10th, 1899, for the first payment; balance of $14,000 to be paid in fourteen equal instalments of one thousand dollars each, payable on or before the tenth day of each and every month for fourteen months, commencing Aug. 10th, 1900. All of these deferred payments to be evidenced by the joint notes of the parties of the second part, conditioned for the payment of the amounts on or before the dates herein specified at the Bank of Commerce, St. Louis, Mo., with interest at the rate of eight per cent, per annum, and with the provision that if the parties of the second part neglect or refuse to pay three or more of said notes when the same shall become due and payable, then and in that case all the notes remaining unpaid, with interest thereon, shall by reason of said default become due and payable.
“It is further agreed between the parties to these presents that the stock agreed to be sold shall remain standing in the names of the present holders until the purchase price and interest is fully paid, and for mutual protection of both parties the stock with power of attorney to transfer duly signed, and all notes above described duly signed, shall be placed in the National Bank of Commerce in St. Louis, Mo., in Escrow, the stock to be delivered to parties of the second part when the purchase money is fully paid with- interest, and not otherwise.
“The title of the stock to remain in the present'holders until the purchase price is fully paid. But the parties of the first part hereby agree that they will not claim the right to vote the whole or any part of the stock herein mentioned without default is made in the payments and the whole of the purchase money not paid becomes due as provided for in this contract.
“And it is further agreed between parties to the instrument that should default be made as hereinbefore recited, so that all the notes remaining unpaid shall become due and payable, then and in that' case the parties of the first part may, after five days’ public notice published in. a newspaper in the city of St. Louis, Mo., sell at the east front door of the courthouse the one hundred shares óf stock hereinbefore described, and out of the proceeds of said sale pay first the cost and expenses of sale, second apply the remaining proceeds on the payment of notes remaining unpaid, third the surplus, if any, to be paid over to parties 'of the second part.
'“It is also further agreed that should any stock dividend be declared by the corporation of Whited & Wheless, Ltd., said stock dividend shall be placed in escrow with the National Bank of Commerce as provided for the stock hereinbefore described, and shall be held like the other security for the payment of the purchase money, notes, subject to sale if default is made in the payments like the original stock or be delivered to parties of the second part upon payment of the indebtedness hereinbefore mentioned.
. “To the provisions of this agreement to be performed by them both parties hereby bind themselves, their executors, administrators and assigns.
“Signed in triplicate, this first day of July, 1899.
“Attest: (Signed)
“P. C. Bulkley,
“Mary M. Bulkley (by P. O. Bulldey,
"Agent and Attorney in Fact.)
“II. II. Wheless,
“F. T. Whited.
(Signed) “J. B. Whittington,
“S. H. Dowell."

The notes referred to in the contract were executed to the order of Mrs. M. M. Bulkley and were deposited, together with the certificates of stock, in the National Bank of St. Louis.

The seventh article of the act of incorporation of Whited & Wheless, Ltd., declared that no transfer of stock by the holders thereof should be binding on the corporation unless said transfer was duly entered on its books. At the time of the agreement copied above, P. O. Bulkley was president of that corporation. After the execution of that act he resigned and - was elected president.

On Oct. 15, 1894, Mrs. Mary M. Bulkley sold to Whited & Wheless, Ltd., for five thousand dollars to her in cash paid over, all the merchantable timber on certain described property. In a later act between the same parties, after reciting the above mentioned sale of timber f or $5,000, it was agreed that the price agreed upon for the timber is 75 cents per thousand standing.

If when cut there should be more than enough to pay the $5,000 consideration, in the deed mentioned and estimated according to Doyle rule, Whited & Wheless were to pay Mary M. Bulkley in cash the difference between the total amount the timber produced and $5,000.

If the timber, when cut, measured and estimated as above provided, produced less than $5,000, the difference should be paid to Whited & Wheless, Ltd., in cash, by Mary M. Bulkley, or other timber equal in amount to supply the deficiency, if any, satisfactory to the corporation, furnished by her.

P. O. Bulkley testified that he afterwards made a verbal demand upon Mr. Wheless, the secretary, for permission to inspect the books of the corporation, but he stated he would have to see Mr. Whited before doing so; that receiving no answer he went into the office of the company and made the same demand, and they both refused; that he made the demand as a stockholder for himself and his wife; that he then made the following written demand.

“Alden Bridge, La., Oct. 2, 1899.
“3. 3. Wheless, Esq., Secretary of Whited & Wheless, Ltd,.
“Dear Sir — My verbal request to be allowed to examine the log and lumber books of the company, not having been complied with, I hereby make a formal demand to be allowed to examine said books. The books referred to .are those which show the log scale and lumber each month. Very respectfully, “P. G. Bulkley, SiocWwlder.
“Mary M. Bulkley, Stockholder.
“By P. O. Bulkley, Attorney in Fact.”

This suit followed a refusal to grant the demand made.

Relators’ demand is basqd upon their rights as stockholders, and it is from that standpoint that we have to pass upon the question submitted to us. Reference is made to a contract of sale made by Mrs.' Bulkley with the defendant company, and a copy of that contract is in the record.

It may be that Mrs. Bulkley may, under it, hold the defendant to an accounting, but the time, place and circumstances under which this 'can be done, are to be determined by the terms and conditions of the contract, which, not being declared on in the present action, can not, in this mandamus proceeding and under the pleadings, be collaterally considered.

There is no doubt of the right of a stockholder under certain limitations to demand an inspection of the books of the corporation to which he belongs.

We have had occasion to investigate and pass upon that question a number of times.

The decisions on this subject will be found reported in 13th Ann. 289; 28 Ann. 204, 426; 49 Ann. 1558; 51 Ann. 320; 50 Ann. 258, 261; 1 Rob. 470; 45 Ann. 669; 47 Ann. 1487. While stockholders are not .owners of the corporate property and they are distinct individually from the corporation itself, their connection-with its property is closely akin to ownership.

They are not creditors of the corporation though they are sometimes spoken of as such. It is upon their quasi ownership in the corporation that their right of inspection is based. The disputed point in this litigation is whether relators are stockholders or not.

■Relators, deny that they have sold their stock to Whited & Wheless. They contend that the contract between them was a mere agreement to sell or a conditional sale, while defendants insist that the contract was one of sale.

Our law recognizes promises of sale, conditional sales and sales with earnest.

Art. 2439 of the Civil Code defines a sale as an agreement by which one gives a thing for a price in current money and the other gives a price in order to have thei thing itself. That three circumstances concur to the perfection of the contract, to-wit: The thing sold, the price, and the consent, and Art, 2456 declares that the sale is considered to be perfect between the parties and the property is of right acquired to the purchaser, with regard to the seller as soon as there exists an agreement for the object and for the price thereof, although the object has not been determined nor the price paid.

A careful consideration of the written terms of the written contract between the parties satisfies us that it evidences a completed sale, and that the stipulations which relators depend upon as going to show the contrary, the placing of the notes and the certificates of the stock in the hands of the National Bank of Commerce at St. Louis, are mere stipulations which the parties had the legal right to stipulate, to safeguard their respective interests, until the obligations of the contract should be finally performed, and not matters holding the completion of the contract in abeyance.

The price between the parties was fixed, the object sold was fixed, and the consent of the parties to a sale, we think, clearly shown by the written contract. The seller seems to have feared that a delivery of possession of the certificate of stock to the purchasers, while a portion of the price was unpaid, might enable them, either designedly or in spite of themselves, to prejudice the vendors’ rights, while the purchasers saw possible dangers to themselves should they permit the vendor to have possession of their notes while he also held the certificate of stock.

The parties therefore resorted in the premises to what is styled an escrow, which we understand was nothing more than a deposit in the' hands of a third party, charged with the duty of delivering the notes and the certificate as the obligations of the, different parties matured. Neither party could withdraw the instrument from the hands of the depository. There was not only a sale of the stock, but a pledge of the same to secure the payment of the price by delivering to a third person agreed upon between the parties. C. C. 3162.

Parties are at liberty to make contracts, so long as they are legal, and to agree upon accidental stipulations; but where they actually make a contract with fixed legal essentials they are powerless to control the legal effect of the contract itself — the contract being made, the law governs its results. Cooley vs. Broad, 29th Ann. 347.

The Supreme Court of the United States had occasion in Heryford vs. Davis, 102 U. S. 235, to construe a contract containing clauses very similar to those in the contract we are now considering, though the contention in that case was between a creditor of the vendee and the vendor, and not the parties themselves, as in this litigation.

Speaking of the construction of the contract in that case the court said: “It is not to be found in any name, which the parties may have given to the instrument, and not alone in any particular provisions it contains, disconnected from all others, but in the ruling intention of the parties gathered from all the language they have used. It is the legal effect of the whole which is to be sought for. The form of the instrument is of little account * * *”

■ '“It appears equally clear to us that the contract was not one for a conditional sale * * *”

“It is quite unmeaning for parties to a contract to say it shall not amount to a sale, when it contains every element of a sale and transmission of ownership. This part of the contract is to be construed in connection with the other provisions so that, if possible, or so far as is possible, they all may harmonize. Thus construed, it is quite plain these stipulations were inserted to enable the manufacturing company to enforce payment, not of any rent or hire, but of the selling price of the cars, for which the company took the notes of the railroad company. They were intended as additional security for the payment of the debt,the latter company assumed. This is shown most clearly by the other provisions of the contract. The notes became the absolute' property of the vendors. As has been stated; they all fell due within four months and it was expected they would be paid. The vendors were expressly allowed to collect them at their maturity, and it was agreed that whatever-sums should be collected on account of them should be retained by the vendors for their own use.

r “No part of the money was to be returned to the railroad company, in any event, not even if the ears should he returned. On the contrary, it was stipulated expressly that if the manufacturing company should eléet to take the cars into their own possession, which they reserved the right to do in case of default of payment of the notes, the property should be sold, and of the net amount realized from the sale so much as should be needed to make the amount remaining due and unpaid on the promissory notes with the interest that might have accrued thereon, should be retained by the manufacturing company, and-the surplus, if any, should be paid over to the railroad company.

“What was this but treating the notes given for the sum agreed to be the price of the cars as a debt absolutely due to the vendors ?- What was it but treating the cars as a security for the debt ? And why stipulate that the surplus, which might be obtained for the sale,of the cars after taking them back beyond what was needed to pay the unpaid part of the debt should be paid over to the railroad company, if that company was not the owner of the cars even while they were in the possession of the other company, and had not even then what may be called an equity of redemption?

“In view of these provisions we can come to no other conclusion than that it was the intention of the parties, manifested by the agreement, the ownership of the cars should pass at once to the railroad company, in consideration of their becoming debtors for the price. Notwithstanding the efforts to cover up the real nature of the contract, its substance was an hypothecation of the cars to secure a debt due to the vendors for the price of a salé. The railroad company was not accorded an option to buy or not. They were bound to pay the price either by paying their notes or surrendering the property to be sold in order to make payment. This was in no sense a conditional sale. This giving the property as a security for the payment of a debt is the very essence of a mortgage which has no existence in a case of conditional sale.

“It may be added that the notes were given to the vendors before the cars were delivered. So, also, the collaterals for the notes were taken before the delivery and when they were taken the president of the manufacturing company acknowledged he received them, not as additional security for the restoration of the ears at any time thereafter when demanded, but as security for the notes given in payment for the ears. This is confirmatory of the construction we have given to the contract. It tends to show that the transaction was a sale by which the ownership passed to the railroad company, the vendees retaining only a lien for the consideration.” P. 246.

We are satisfied the contract between the relators in this ease and Whited & Wheless was a contract of sale, not a promise of sale.

The clause in the defendants’ charter as to any transfer of stock not being binding upon it until it was placed upon its books was for the protection of the company, not to extend or maintain rights which the original owner of the stock had parted with in favor of a third person.

Entertaining the views we do as to the rights of the parties, we are of the opinion, the judgment appealed from is erroneous and that it should be annulled and reversed.

Eor the reasons assigned it is ordered, adjudged and decreed that the judgment appealed from be and the same is hereby annulled, avoided and reversed, and that relators’ demand as made in this action be and the same is rejected.

Mr. Justice Blanchard dissents on the authority of Burdette vs. Gas Light Company, 49th Ann. 1556, and State ex rel. Burke vs. Citizens’ Bank of Jennings, 51st Ann. 426.

Rehearing refused.


author: Watkins, J.

text:
    No. 13,498.
    Charles C. Hardy vs. Paul Pecot, Sheriff, et als.
    Syllabus.
    In the absence of all privity of contract between the plaintiff and the party called in warranty, a proper case is not made for such a call; and when the party called resides in a parish different from that in which the suit is brought, an exception to the jurisdiction of the court ratione materias should be sustained and the call in warranty dismissed.
    APPEAL from the Twenty-Fourth Judicial District, Parish of St. Mary — Allen, J.

      Milling & Sanders for Plaintiff, Appellant.

      Philip H. Meniz for Ermann & Cahn, Called in Warranty, Appellees.
   The opinion of the court was delivered by

Watkins, J.

The question in this case for the court to decide is one of jurisdiction ratione materiae, the suit having been brought in the Parish of St. Mary, and the parties who were cited and excepted, reside in the Parish of Orleans.

The exception to the jurisdiction of the court having been sustained, and the suit dismissed with reference to said parties, the plaintiff prosecutes this appeal.

This suit is in the nature of a third opposition in which the opponent, as a junior mortgage creditor, seeks to recover from the principal defendant, as prior mortgage creditor, an alleged surplus of the proceeds of a judicial sale of the mortgaged property realized in foreclosure proceedings by executory process over and above the amount of his debt — the sheriff being made a party defendant, also.

The principal defendant resists opponent’s demand, on the ground that the proceeds of sale were absorbed by his mortgage debt, interest, cost and attorney’s fees, and no surplus remained that is applicable thereto; but if, in point of fact, it should appear that there did remain a surplus, then his claim is that there existed prior liens, charges and demands of other persons against the mortgaged property that ranked his vendor’s mortgage far in excess of opponent’s judicial mortgage, and that he, as purchaser of the property at judicial sale, was entitled to retain said surplus to meet said demands.

■ This claim of the defendant was met by a plea of estoppel on the part of opponent, to the effect that he had acquired the mortgage notes which sent the property to sale from Ermann and Cahn of the Parish of Orleans, and that they sold the property mortgaged to The Pecot Sugar Factory Company, Limited, and in the title there was a stipulation of warranty against all mortgages, liens or other encumbrances on the property eonveyed; and- that in consequence thereof, neither Ermann and Cahn nor their transferree of the Sugar Company’s mortgage notes could urge the aforesaid claims against the opponent who is seeking to exercise the rights of the Sugar Company as its debtor, and which had failed to urge the same against the principal defendant as seizing creditor.

Having filed this plea, opponent called Ermann and Cahn in warranty and cited them to appear in the court in the Parish of St. Mary and answer his demands to make their warranty good; and to that call in warranty the warrantors tendered their exception to the jurisdiction of the court ratione materiae.

The following resume of the facts we have extracted from the brief of the defendant’s counsel, as a comparison of same with the record appears to justify their accuracy:

“The plaintiff, who is the executrix of the last will and testa- . “ment of Chas. O. Hardy, deceased, appeals from a judgment “ sustaining a plea to the jurisdiction filed by Ermann and Cahn, “ whom she called in warranty.
“The facts from which this controversy arises, so far as they “ illustrate the call in warranty against Ermann and Calm, which “ is the only matter before this Honorable Court, can be briefly “ stated.
“Ermann and Cahn sold a certain plantation to the Pecot Sugar “ Factory Co., Ltd., and the greater part of the price was repre- “ sented by notes. Ermann and Cahn afterwards sold these notes “ to John II. Pharr, who foreclosed upon the property, the notes “then amounting, less certain credits, and with interest and “attorney’s fees, to over eighty thousand dollars ($80,000). The “ Pecot Sugar Factory Co., Ltd., had meanwhile, become insolvent “ and unable to proceed, ¿nd its charter had been forfeited and a “ receiver, called in the judgment of forfeiture a commissioner for “ the liquidation of its affairs, had been appointed.
“Pharr brought suit against the commissioner for the liquidation “ of the insolvent corporation, the sheriff sold the property, and “ Pharr acquired it at that sale.
“When Ermann and Cahn sold to the Pecot Sugar Factory Co., ■ “ Ltd., they gave the usual warranty against encumbrances.
“Charles C. Hardy became a judgment creditor of the Pecot “ Sugar Factory Co., Ltd., his mortgage being inferior to that of “ the vendors, Ermann and Calm, whose claim passed to Pharr. ■
“ Hardy, after the sale to Pharr, filed a suit against the sheriff, “ making Pharr a party, averring that after deducting the claims “ that Pharr had, from the bid that he made, there remained in his • “ hands a- sum sufficient to pay the inferior judicial mortgage of “Hardy.”

As disclosing opponent’s cause of action and the nature of the claim he sets up against, the alleged warrantors, we make the following extract from his call in warranty, viz:

“Plaintiff further avers that in said notarial act of transfer, the • “said Ermann & Cahn sold said property with full and general “warranty of title, against all liens and privileges whatsoever, as “ fully appears by reference to said notarial act of transfer, hereto “ annexed and made a part hereof, and that your plaintiff, upon “ faith of the ownership by said Pecot Sugar Factory Co., Ltd., of “ the property described in said act and sold to John N. Pharr at “ said judicial sale above referred to, and upon the faith of the “warranty by said Ermann & Cahn in said act, your plaintiff “ gave credit to the Pecot Sugar Co., Ltd., and it is now indebted “ to your petitioner in the sum,” etc.
x -x- x * x -x- x
“But in case the said warrantors should fail to appear and successfully defend said suit, or in case your Honors should decree “that said mortgages and privileges set up in defendant’s answer “ are legal and valid obligations and rest upon and affect the property purchased by said Pharr, and that he is entitled to use the “ sums realized in excess of the amount due him upon the vendor’s “privilege, in extinguishing the said mortgages and privileges, “then that the plaintiff do have judgment against and recover “ from the said Abraham Ermann and Leon Cahn, as warrantors “ of said property, the full sum of,” etc.

The record discloses that the claim of opponent is founded upon a judicial mortgage that resulted from the rendition of a judgment in its favor against the Sugar Company subsequent to its purchase of the property from Ermann & Cahn, and the registry of their vendor’s mortgage; and these proceedings were not commenced until after the lapse of more than a year after Pharr purchased same.

Opponent’s claim not having any existence when the sale was made, he was neither a party nor privy thereto, and was necessarily a third person to all intents and purposes; but his claim is, that having acted on the faith of the public records which disclosed the warranty clause in its deed, and given the Sugar Company credit on that account, he is entitled to exercise Us right of warranty against Ermann & Cahn, and Pharr, as transferee, of their ven^r’s notes.

Therefore, his claim is not one that arose ex contractu in so far as Ermann & Cahn and Pharr are concerned; and Pharr having no connection with the transaction other than as the transferee of the notes, occupies no contractual relations with either party as to property.

Dealing with the question of jurisdiction, we must determine whether there is any question of warranty in this case, and if so, what is its character ?

The law declares that the general rule is that the defendant must be sued before the court of his domicile (C. P. 162); but an exception to that rule is that “in matters relative to warranty (suits) must be carried before the courts having cognizance of the principal action in which demands for warranty arise.” (C. P. 165.)

The law further declares that “real warranty is that which arises in real or hypothecary actions,” and “personal warranty is that which takes place in personal actions, and it arises from the obligation which one has contracted to pay the whole of a part of a debt due by another to a third person.” (C. P. 379).

The opponent’s action is personal, while his call in warranty is real. He demands the surplus of the proceeds of a sale of real estate in ■ money — neither the property sold, nor the mortgage which rested upon it being in any way involved.

When defendant by an answer setting up prior claims on the property ranking his, and opponent urges a plea of estoppel thereto, and then supports same by a call in warranty against Ermann & Cahn, who were not in any manner connected with the original litigation, no privity of contract is disclosed. It is not alleged that they had, at any time, contracted with opponent to pay his debt. That could not be the case, as the debt in favor of opponent had no existence when Ermann & Cahn sold the property to the Sugar Company.

The admitted facts show clearly that they knew nothing of it. And, as opponent alleges that in permitting the Sugar Company to contract its indebtedness in his favor he acted on the faith of the knowledge he obtained from the public records of the existence of Ermann & Calm’s' contract of warranty to' the Sugar Company, it is clear there is no obligation of warranty in his favor.

And granting that he has the legal right to exercise the rights of the Sugar Company as his debtor against its warrantors, he must be restricted to the kind of cases in which the contract of warranty may be enforced. In our ■ opinion, it is not competent for the opponent to resort to the present form of proceeding in the attempted enforcement of his rights, against Ermann & Cahn, citizens of the' Parish of Orleans.

There is no privity between Ermann & Cahn and the opponent, and none between the Sugar Company and opponent.

In Levy vs. Railroad Co., 35th Ann. 616, this court held that “in the absence of all privity between the plaintiff 'and the parly called in warranty, semble that it is not a proper case for such a call, under the provisions of C. P. 379; 8 La. 37; 8 R. 27; 8 Ann. 136.” Leisey vs. Tanner, 28th Ann. 299; Wesson vs. Garrison, 8th Ann. 136; Howrin vs. Clark, 8 R. 27.

We have carefully examined the case of Oliver vs. Bry & Stephens, 7 Ann. 590, on which opponent relies, without being influenced thereby to change our views. It might have some bearing on the controversy as to Pharr, but not as to Ermann & Oahn; and that branch of the controversy is not under consideration.

The district judge entertained a proper appreciation of the law of warranty, and we approve his ruling.

Judgment affirmed.


author: Breaux, J.

text:
    No. 13,501.
    Thomas J. Upton vs. Times-Democrat Publishing Company.
    Syllabus.
    1. In this action, brought to recover damages for publishing a dispatch intended originally to be complimentary, changed by mistake in its transmission by the substituting of the word “colored” for “cultured,” small amount of damages is allowed.
    2. The publication was not, in so far as defendant is concerned, prompted by malice, nor was it the result of negligence. Due retraction and, apology were made within reasonable time.
    3. There was a cause of action, and to the extent of the injury the action is sustained.
    APPEAL from the Civil District Court, Parish of Orleans.^— Thea/rd, J.

      D. M. & Allan Sholars for Plaintiff, Appellant.

      Lawrence O’Donnell for Defendant, Appellee.

      E. Howard McOaleb for Postal Telegraph Company, Called in Warranty, Appellee.
   The opinion of the court was delivered by

Breaux, J.

Plaintiff sued the defendant for damages in the sum of five thousand dollars for publishing a telegraphic dispatch, in which it was stated that “The Rev. Thos. J. Upton is a negro.”

It appears that at a meeting of the Police Jury of the parish of East Baton Rouge, a petition was read by the Rev. Upton, asking that body to order an election in that parish with a view of prohibiting the sale of intoxicating liquors* There was a counter (petition presented by another resident of the parish in favor of the indefinite postponement of such an election.

The Baton Rouge correspondent of the defendant company sent a telegraphic account of the meeting to that company for publication. The correspondent and representative of that newspaper in Baton Rouge, prompted by a desire to be complimentary to the Rev Mr. Upton, stated in the dispatch that he, Upton, by whom the petition for an election was presented, was a cultured gentleman; and that his arguments in favor of an election were eloquently presented. In transmitting the dispatch, a mistake was made. The word “cultured,” as written by this correspondent, was changed -to “colored,” and the dispatch read that a “colored gentleman,” instead of a “cultured gentleman,” had presented the petition. At the office of the Times-Democrat, the words “colored gentleman” were changed to “negro,” for the reason that the latter word is always used by that paper as the proper word.

Naturally enough, the dispatch coming to plaintiff as it did, must have aroused his indignation. He lost no time in seeking the redress to which he was justly entitled.

The day of the publication (viz. 13th September, 1900) of the telegram in question, he wrote to the proprietors of the Times-Democrat, complaining of the gross injustice done him, and informing them that he had placed the matter in the hands of his attorneys. This letter was received the day after it had been written.

The assistant editor of the newspaper, in charge in the absence of the night editor, received notice by telegram from the Baton Rouge correspondent of the newspaper at about twelve o’clock at night, September 13th, stating that a mistake had been made in the issue of that day by changing “cultured” to “colored.” This was the first intimation of the mistake. It was received too late, defendant urges, to correct the error in the paper of the 14th, as there was some rush in issuing the paper; and, furthermore, there was no time that night to make the investigation, which the night editor in charge desired to make, in order to place the responsibility where it belonged.

In answer to Mr. Upton’s letter, received on the 14th of September, this assistant editor wrote a retraction, and, in substance, stated that the mistake had been made by the Telegraph Company; that they were sorry .that a mistake had been made; that the word had come to them “colored” instead of “cultured;” and that the moment they found out the mistake, they determined to retract and that to the retraction would be given the same prominence as had been given to the original mistake. The retraction of the Times-Demoerat was published on the fifteenth day of September, and stated that Eev. Upton was of the purest Caucasian race; that he was at one time the president of the Homer College, in Claiborne Parish, and that he is an eminent minister of the Gospel, a member of the Louisiana Conference of the Methodist Church and pastor of the Zachary Church in East Baton Eouge.

In the pleadings, in answer to plaintiff’s demand for damages, defendant disclaimed having been actuated by malice; alleged that the error had been committed by the Telegraph Company, and averred that the mistake was timely corrected after it had been discovered. ■

Defendant called the Postal Telegraph Company in warranty. The company thus called in warranty, interposed an exception of no cause of action, for the reason that libel is a quasi — offence, and no warranty exists where damage is claimed for an offence or gwm-offenee. This exception was sustained, and no appeal was taken from the order dismissing the prayer for a call in warranty. In consequence, the issues before the court aie, exclusively, confined to judgment for plaintiff against the defendant.

The judge of the District Court pronounced judgment in favor of Thomas J. Upton, and against the defendant, the Times-Demoerat Publishing Company, for fifty dollars, with interest from the date, of the judgment. Erom the judgment, plaintiff prosecutes this appeal.

The word complained of was provoking to an extreme degree. Inserted as it was in one of the daily papers, it was enough to arouse the most profound indignation of the most patient man. Plaintiff, naturally, at once, took steps to find out how it was that he was referred, to as not being a white man.

Taking up the facts for review, we, in the first place, note, as one of the incidents of the case, that those in charge of the defendant company did not know the plaintiff at all. When the mistake was called to the editor’s attention late at night of the day of publication, he chose to wait and find out how it was that such a mistake had been committed. We may as well say here, we take it that the change from “colored gentleman” to “negro” as made, presents no ground of complaint. One expression, “colored gentleman,” was as objectionable as the other, “negro.” We have noted that the night editor desired, before making a retraction, to fix the responsibility where it belonged, and to that end to make further inquiry. lie postponed all steps in the matter to the day after the offending dispatch had been published. The next day, the 14th of September, the defendant company received a letter from plaintiff complaining of the outrageous wrong. In answer to this letter, defendant stated that it was a mistake committed by the Telegraph Company;- that the word came to the company for publication “colored” and not “cultured,” and that complete retraction would be made. The retraction was written and the defendant sought to give it all the publicity and prominence ¡that had been given to the mistake.

Had the steps taken by the plaintiff to discover and bring to light the error made by the defendant, been met on the part of ^he defendant with unwillingness and reluctance to correct it and right the wrong, there would have been some cause to complain of intentional wrong and malice, and to claim not only actual but exemplary damages. Such is not the case.

We have not found that the defendant was, at any time, unwilling to publish a retraction and apology. The cause of the delay of twenty-four hours before the retraction and apology were published, in view of the circumstances as alleged and sustained by the testimony, do not present the appearance of injuriously intended delay.

From the evidence before us, we meet with no difficulty in arriving at the conclusion that the retraction and the apology were full and complete, and that they were as timely made as the occasion permitted.

But retraction and apology, even when timely, are not all that is needful to relieve a publishing company from liability. For injury resulting from oversight or negligence, even when there is no malice or evil intent, may give rise to liability in damages. A newspaper would yet be liable if an injurious untruth should find its way into its columns, though by the merest accident. The law seeks to protect the innocent who has been injured by libellous reports. The fact that a management may be all that can be expected to guard against unfortunate accidents is not, in itself, a protection from damages and a sufficient defence.

This brings us to a consideration of the damages which should be allowed. There is no question of exemplary damages. Now as to actual damages, they cannot, in view of the facts, be assessed at any other than a very limited amount. The claim, after all, grows out of a mere mistake. Counsel for plaintiff cites several decisions of this court relating to damages against newspapers for libellous publications in which damages for considerable sums were allowed. They were not similar to the ease before us for decision. In each case false accusations had been brought, most of them before the courts. The publishers of the libellous reports were not free from blame. They had published charges which should not have been published. In those cases, growing out of court proceedings, the newspapers condemned to pay damages were not the chroniclers of events as they had occurred, but went beyond to publish comments regarding the facts, and this must have given rise to an appearance of wrong.

In the case before us, there is nothing of the sort. It was the publishing of a mistake for which the defendant was in no way responsible. We have to deal, as relates to damages, only with the real and actual, and not with the exemplary and punitive.

In our view, the real injury sustained must have been very inconsiderable. The untruth published could not have had the least effect, even for a moment. To illustrate: If one who has marked moral character, great prestige, and austere probity, is accidentally charged with having committed an improper act, the charge, as relates to actual damages, would have no gréat effect; or if, as in the case before us for decision, the name of one of well known lineage should, by the merest accident, be characterized untruthfully, the actual damages would be inconsiderable.

It is, therefore, ordered, adjudged and decreed that the judgment appealed from be affirmed at appellant’s costs.


text:
    No. 13,354.
    Henry P. Hake vs. S. R. Lee and W. C. Beale.
    Syllabus.
    On Motion to Dismiss.
    Although on other grounds and tor special reasons sustained by the record, the court did not dismiss the appeal, none the less it held that a motion to dismiss the appeal is still in time, though filed more than three days after the return day of the appeal. It appeared, however, that while the three days had elapsed within which to return the appeal, the Supreme Court had, upon sufficient showing and for cause, extended the return day (prior to the lapsing of the time) to a date within which the transcript was • filed.
    On the Merits.
    Plaintiff was entitled to an injunction on the ground that he had taken a suspensive appeal from the judgment dissolving the injunction with the view of compelling the defendants to let the matters in the litigation remain in statu quo until the decision of the issues on appeal.
    The injunction is given full force and effect until the decision on appeal.
    APPEAL from the Fourth Judicial District, Parish of Grant— Machen, J.

      B. J. Bowman for Plaintiff, Appellant.

      'William O. Roberts for Defendant, Appellee.
   On Motion to Dismiss.

The opinion of the court was 'delivered by

Breaux, J.

Plaintiff addressed a petition to the District Court for an appeal. On this petition the judge of the District Court granted 3iim an appeal returnable to the Supreme Court on the second Monday of November, 1899. This appeal was granted in conformity with the decree of this court rendered in proceedings on mandamus, instituted to compel the respondent judge to grant him an appeal. State ex rel, Paire vs. Judge, 52 Ann. 103. The order of appeal was dated in December, 1899, but the return day of the appeal was fixed for the preceding November, the order being granted nunc pro time.

The transcript of appeal was filed in the office of the clerk of the Supreme Court on the second day of February, 1900. On the eighth day of February, defendant filed a motion to dismiss the appeal, on the ground that the plaintiff had failed to file a transcript of appeal at the date that the appeal was made returnable.

Appellant, in the first place, insists that the motion to dismiss the appeal was filed too late, as it was filed more than three days after the filing of the transcript. This defense, to prevent dismissal of an appeal, was urged in Dwight vs. McMillan, 4th Ann. 350. The court did not sustain it, but, on the contrary, the court held that a motion to dismiss on the ground that the transcript was not filed in time, was still in time, although made more than three days after the filing of the record. Regarding the appellee, the court said that he could not be held to constant vigilance after the legal delay has passed in watching, day by day, the docket, to see at what time the tardy appellant will file his appeal. A similar motion to dismiss the appeal was again considered in McDonough vs. DeGruys, 10th Ann. 75, and again the appeal was dismissed. Recently, in Coudroy vs. Pecot, 51st Ann. 495, this court reiterated that the prior ruling was correct, and said: “The first return day having passed without the filing of the transcript, appellee was not called upon to be in court upon any subsequent return day for the parish, to ascertain whether the transcript would be filed, and if so, at what time.” But plaintiff urges further, in support of his appeal, that he obtained an extension of time. From the foregoing statement it is evident that plaintiff could only retain his right of appeal by obtaining an extension within which to file his appeal, which he has obtained.

On the 22nd of November, 1899, he filed an application for an extension to the second Monday in January, 1900, which was granted on the day following, for reasons sustained by plaintiff’s oath, which the court deemed sufficient. On the second Monday in January, 1900, he applied for another extension, and as that was a legal holiday, the order granting the time asked for was entered on the ninth of January, extending the time to the fifth of February. We have noted that the transcript was filed on the third day of February. This was amply in time, and, therefore, the appeal will not be dismissed. It was necessary to grant the delays' applied for, otherwise it would be useless to sue out a mandamus to compel the judge of the District Court to sign an order of appeal. The time within which to complete the appeal nearly always elapses before final decision. Ex necessitate rei there must be an extension granted. The motion to dismiss the appeal is denied.

On the Merits.

Plaintiff seeks to enjoin defendants from cutting timber on lands claimed by him in the suit of Hake vs. Lee and Beale, filed in August, 1898. The ground for the second injunction is that there is another injunction in another suit which was filed in October, 1898, and which is pending before the court, and which defendants illegally insist upon disregarding and violating. The purpose of the second injunction is to protect the first. In the first motion filed to dissolve the injunction, the defendants alleged that plaintiffs had no cause of action, and in the second motion to dissolve, defendants denied that there was a pending injunction, as alleged by plaintiff in his second petition for an injunction to be sued out to enforce the first. The first injunction is not before us for decision on this appeal.

The defendants especially averred that the first injunction had been dissolved on bond and that the appeal taken from the order permitting the defendant to dissolve, on furnishing bond, was devolutive and not suspensive. On the trial of this second injunction, now before us for decision, plaintiff offered in evidence the record in the first suit for an injunction including defendant’s application to dissolve on bond, and the judgment rendered on that application permitting defendants to dissolve on bond. Plaintiff also offered his appeal bond, completing his appeal from the order or judgment permitting the defendants to bond the first injunction. Evidence was also heard regarding the value of the property and the fee of the attorney.

The judge of the District Court held that no suspensive appeal had been taken by plaintiff, Hake, from the order permitting the defendants to dissolve on bond; that, in acquiescing plaintiff was without right to sue out a second injunction “on the ground that he had taken a suspensive appeaífrom the judgment dissolving the original injunction” and, thereupon, he dissolved the injunction and condemned the plaintiffs in injunction to pay fifty dollars ,as attorney’s fees.'

The questions now before us were considered at some length in State ex rel. Hake vs. Judge, 52nd Ann. 103. The decision in that case prohibited the judge a quo from giving effect, pending the appeal, to his order dissolving relator’s injunction on bond. The court found that which the district judge failed to find, viz: that plaintiff had taken a suspensive appeal. It follows that the injunction taken out for the purpose of enforcing- the suspensive appeal, and compelling the defendants to obey the first injunction, until a final decision on appeal, should not have been dissolved. The theory upon which it, the second injunction, was dissolved, was entirely erroneous. In view of the error, it only remains for us to annul and sét aside the judgment in this case. This will have the effect of reinstating the injunction. It follows that the judgment which was rendered by the District Court in favor of defendants for fifty dollars attorney’s fees must also be annulled.

In the decision cited supra, the court said, in substance, that the questions before the court in this litigation, were whether an owner in indivisión, may be restrained by injunction by his co-owner from cutting timber on the common property without the co-owner having the right to dissolve on a bond, for the reason that the act enjoined was in the nature of a trespass; that where one is claiming ownership, and it being a bona fide suit to vindicate his title, the defendant should let matters remain in slatu quo until final decision.

Both these questions will receive consideration in the case numbered 13,433, as .they are not before us to be decided in this case. Motion to dissolve on bond was made in the case just cited, and not in the one here. It was in that case that the appeal was taken to set aside the order permitting- defendants to bond the injunction. As to this case, the injunction cannot have any more effect than a suspensive appeal. It must have force until the first injunction to which plaintiff has taken a suspensive appeal shall have been finally decided. After the decision, it will have served the purpose for which it Was obtained. Plaintiff asks for an amount for attorney’s fees for taking out an injunction. . Such an amount is allowed only in exceptional eases to plaintiffs in injunction suits. The issues here, in our view, do not call for the damage claimed to meet the fee of the attorney.

It is therefore adjudged, ordered and decreed that the judgment appealed from be annulled, avoided, and reversed, that defendants’ claim for attorney’s fees be rejected, and that the injunction remain in full force until the final decision in case No. 13,433, now pending before this court on appeal. The defendants must pay the costs of both courts.

Eehearing refused.