text:
    No. 8093.
    City of New Orleans vs. Julien Vergnole.
    Article 206 of the Constitution, providing that “No political corporation shall impose a greater license tax than is imposed by the General Assembly for State purposes,” was not intended to act retroactively.
    The Constitution took effect from and after the first day of January 1880.
    Article 206 does not, therefore, affect the legality of the License ordinance of the City of New Orleans, No. 6253, passed on the 23rd of December 1879, under the laws then in force, and imposing certain municipal license taxes.
    The same rules of construction apply to State Constitutions and to the Acts of the Legislature.
    In order that a statute should be retroactive, the intention of the lawgiver in that -respect must have been expressed in clear and unambiguous terms.
    .A.PPEAL from the First City Court of New Orleans. Skinner, J.

      Sami. P. Blanc, Assistant City Attorney, for Plaintiff and Appellee.
    Art. 206 has no retroactive effect; its terms are of the future. It does not affect licenses imposed prior to the Constitution going into effect, January 1st, 1880.

      The licenses sued for were imposed prior to January 1st, 1880, in obedience to a number of mandatory and unambiguous special laws governing the City of Mew Orleans. Acts of 1870, Ex. Ses., Mo. 7, Secs. 18 and 19, et seq,*, Acts 1872, Mo. 73; Acts 1879, Mo. 38.
    Laws are never to bo taken as retroactive unless, by the rigor of their language, such in tent is clearly expressed and admits of no doubt, 44 Cal. 303; 31 An. 781; 29 An. 416; Cooley, Taxation, p. 221; "Wade, Retroactive Laws, §§ 33, 34, 35,

      JR. BJ. JMJarr and J. li. Beckwith for Defendant and Appellant.
   The opinion of the Court was delivered by

Todd, J.

The defendant is appellant from a judgment of the First City Court of New Orleans, which condemns him to pay a license tax of one hundred dollars, assessed under the License Ordinance of the City of New Orleans, No. 6253, passed on the 22d of December, 1879.

By agreement of counsel, in the record, “ the matter in controversy is limited to “ the question of the constitutionality and legality of the license imposed by said ordinance.”

The payment of this license is resisted on the ground, that by article 206 of the present Constitution, State licenses are required to be graduated, and municipal corporations are prohibited from imposing a greater license than is imposed by the State; that under Act 119 of 1880, his State license is only ten dollars; in other words, the issue presented is, whether the ordinance referred to, imposing the license in question, was or not abrogated by the article of the Constitution cited.

The providing of an adequate revenue for the City of New Orleans has been a subject of much and frequent legislation by the State, as the matter of the maintenance and administration of the government of so great a city might well be deemed a subject of the highest importance, and one demanding the greatest wisdom and discretion on the part of the law-making power. By the proper statutory enactments, it was required that the City Council should, once a year, make an estimate of the annual expenses necessary to the proper administration of the government,' and impose general taxes and licenses to meet such expenses.

Thus the act of 1870, extra session, sections 18 and 19, orders, “ that the Council, at its first meeting in JDecemJber, and on the same day annually thereafter, shall impose an annual license tax on trades, professions, callings,” etc.

The same act further provides that the estimates thus adopted “ shall be considered as the appropriation of the amount therein stated; and the Administrator of Public Accounts shall not audit, nor shall the Administrator of Finance draw or sign any check upon the Fiscal Agent therefor, of any claims, unless an appropriation therefor has been duly made in accordance with this act.”

And Act No. 38 of 1879, passed by the same Legislature that called the Constitutional Convention, made it the duty of the Council, on the second Tuesday'of December, 1879, and of each and every year thereafter, to propose a detailed statement, exhibiting the amount of revenues for the ensuing year expected to be derived from taxes and licenses. It further providedthat these estimates should be published for ten consecutive days and, at the first regular meeting of the Council thereafter, it should proceed to adopt the estimates made and " then and there” levy a tax, and provide for the collection of the same; and for the realization of the license tax, for the purpose of meeting the liabilities and expenditures of these estimates, which estimates are expressly declared as “sacred to the object of their appropriation until the liability or debt provided for shall have become paid or extinguished.”

We have cited only some of the acts on this subject, and specially referred to a few of the leading provisions of those cited; deeming this reference necessary in order to discover the main purposes of their enactment, and the significant and most important features, of this legislation. It is apparent from the reference, that the direct object of these laws was to insure the greatest possible care and deliberation in making up the budget of receipts and expenditures; provide for the publication of the same; adopt the most effective method for the collection of the revenue; and fix the time at which, or within which, all this must be done. It is evident that the whole was to constitute a plan to carry out the object in view, of providing an adequate revenue for the proper administration of the city government; and upon which plan all the contemplated operations of that government, and all contracts and agreements relating thereto and the faith of such contracts and agreements’ were to be based.

The parts of this plan or system, made up of these different requirements, were so connected and intervoven, that to disturb one would be, in effect, to disarrange and confuse the whole. Thus to illustrate; The amount required for all the various objects of the government is to be ascertained; an estimate made of the sums to be derived from licenses, and the total amount needed, and which the license tax and other sources may fail to supply, is to be made up by general taxes, and the rate of taxation to be determined by these data. The accomplishment of the important objects in view, and the complete execution of the measures devised, must, of necessity, largely depend upon the time at which they are inaugurated. Abrogate the licenses imposed,-and you destroy the source from which means are to come to meet some expense or supply some want that is sure to occur, and thus effectually repeal appropriations for purposes that must arise. Change the date or period at which all this must be done, and you abridge the time necessary to insure the successful working of the- plan. In fine, destroy or disarrange any of these essential parts or elements, and you effectually break down the whole.

There is-no question but that all the steps required by the laws mentioned were taken in strict conformity thereto ; and the ordinance attacked, under which the licenses were imposed, was entirely regular, and sanctioned by the legislative enactments referred to; but the question is, whether this ordinance was repealed or abrogated by the present Constitution. It would seem strange indeed, if the Convention should intentionally destroy or impair the plan or system, so long established, for providing a revenue for the City of New Orleans, by the abrogation of the laws and ordinances on which it rested. Nor are we warranted in coming to such conclusion, unless such intention is unmistakably shown by the plain letter of the Constil ution. The ordinance, under which the license in this case was sought to be collected, was adopted and went into effect on the 23d of December, 1879. Was it repealed by the Constitution ? Article 262 of that instrument provides that if a majority of the voters of the State should ratify the Constitution, that the Governor should make proclamation of that fact; and further declared, and thenceforth this Constitution shall be ordained and established as the Constitution of the State of Louisiana.” The proclamation was accordingly made on the 31st of December, 1879, and the Constitution took effect from and after the 1st of January, 1880. The following is the article, or the clauses thereof, mainly relied on as repealing the ordinance in question.

“ Art. 206. The General Assembly may levy a license tax, and in such case, shall graduate the amount of such tax to be collected from persons pursuing the several trades, professions, vocations and callings.”

“ No political corporation shall impose a greater license tax than is imposed by the General Assembly for State purposes.”

Is this article to be construed as having a retrospective operation, or was it prospective only ?

Article 8 of the Civil Code lays down a very important rule of construction, as follows:

“ A law can prescribe only for the future; it can have no retrospective operation, nor can it impair the obligation of contracts.”

This article merely dictates an universal rule of construction, recognized in every known system of jurisprudence. Thus a distinguished law writer, treating of this subject, has said :

“One of the cardinal rules by which courts are governed in inierpreting statutes is, they must be construed as prospective in every tnstance, except where the legislative intent that they shall act retrospectively is expressed in clear and unambiguous terms, or such intent is necessarily implied.” “Every reasonable doubt as'to the intention of the law-maker is resolved against rather than in favor of the retroactive operation of the statute.”
“The mere fact that parties contract, with actual or constructive notice of an impending change in the law, raises no presumption that the contract is made with reference to such change.” Wade, Eetroactive Laws, $ 33, 34, 35.

This last quotation meets the objection of the counsel to the ordinance, that it was passed after the vote on the ratification had been taken, though not declared when the ordinance was passed.

The identical rule of construction unquestionably prevails in regard to constitutional provisions as with reference to statutory enactments.

Thus the same writer. (Wade) declares :

“ This principle is not only applicable to legislative acts, but to State Constitutions, and, in fine, to all written law. Being a rule of construction, it may be applied to every conceivable expression of the will of the law making power where there is a doubt, whether it was intended to take effect prospectively or retrospectively. An illustration as to its application to State Constitutions is, when they contain provisions prohibiting the Legislature from authorizing counties, or other subordinate branches of the State government, to assume certain liabilities. Such provisions cannot affect the validity of special statutes, already in existence, authorizing the assumption of such liabilities, but will be construed as prospective.” And he cites the following authorities as sustaining this proposition: 85 Pa. St. 357; 81 Pa. St. 482; 9 W. Va. 162; 23 Md. 503; 41 Mo. 453.

Sedgwick lays down the same principle; “ Sedgwick,” Construction of Statutory and Constitutional Laws, p. 19. See, also, Cooley on Taxation, p. 221.

This rule of construction has been expressly sanctioned and confirmed by many decisions of the State Courts.

In the ease of Oakland vs. Whipple, 44 Cal. 303, it was held: “ Where taxes are levied under a law which is repealed by a subsequent act, unless it appears clearly that the Legislature intended the appeal to work retrospectively, it will be assumed that it intended the taxes to be collected according to laws in force when they were levied.’’

And in our own State, in a recent case decided by our immediate predecessors, case of the Rhenish Westphalian Lloyds, 31 A. 781, it was said: “ Turning to the provisions of the act, we find it is couched in terms prospective only. It declares: No parish or municipal corporation throughout the State shall assess any license tax over $500, etc.; that the act shall take effect from and after its passage, 9th February, 1879. Here, then, are no words looking to the past. Its operation is, by its very terms, for the future. It does not say that no corporation shall collect, but that it shall not hereafter assess, i. e., levy, or impose a greater tax.”

This language is peculiarly applicable to the case at bar. For in the case cited, the issue was very similar to the one here presented and it was therein expressly decided:

“ That an act of the Legislature, which declares that no municipal corporation shall assess any license tax on certain persons over $500, and prescribes that the act shall take effect from and after its passage, cannot be construed as retroactive; but applies only to future assessments of such tax, and does not repeal any municipal ordinance assessing a larger tax, which was enacted by the corporate authorities before the passage of the act”

Applying this rule of construction to the article of the Constitution (206) relied on as repealing the ordinance in question, the reasonableness and correctness of the rule but becomes the more apparent. It declares that “ the General Assembly may levy a license tax, and in suck case, shall graduate the amount of such tax, etc., and that “no political corporation shall impose a greater license tax than is imposed by the General Assembly for State purposes.”

It will be seen, that while the language of this article is clearly prospective, it is at the same time not imperative, but merely permissive; the Legislature may, in its discretion, or at its option, levy such license tax. If the construction of this clause contended for by the defendant’s counsel be correct, it would follow that although the laws in force at the time made it obligatory on the Council to pass them at the time fixed, such ordinance imposing licenses under declared penalties, the Council should have refused to do so, and awaited the taking effect of the new Constitution, not then officially known to be adopted; and then wait further to ascertain whether the General Assembly, to convene under that Constitution, would or not, in its discretion, levy a State license tax ; and then, if such tax was levied by the State, either to wait again till the appointed time, at the end of the year, to assess the licenses for 'the year then about expiring, or to make such a levy on a day not authorized by , law, and by such unauthorized action provoke resistance to the payment of the licenses thus irregularly assessed. The inevitable result of all such delay and inaction would have been the loss to the city of all its revenue from licenses, and the consequent utter derangement of its financial affairs, involving the utmost confusion and embarrassmenin the administration of the city government, if not its complete destruet tion. Can any reasonable mind believe, for a moment, that the convention that framed the Constitution intended to inflict such a disaster on the city ? Yet we would have to believe so if we gave the article in question, the construction contended for.

The conclusion is irresistible to our minds, that the article cited was purely and entirely prospective in its operation, and its effect as to the City of New Orleans was suspended until the State, through its legislative department, had adopted a system of State licenses, and then only required the city government, in its subsequent assessments, at times regularly appointed therefor by previous laws, to comply with the provisions of the article ; and such action on the part of the city authorities to have effect only for the years respectively next ensuing thereafter.

Article 218 of the Constitution is also cited by the able counsel of defendant as sustaining his views. It needs only an inspection of this article to discover that its true meaning is that it extends all the provisions of the Constitution relating to the collection of State taxes and to tax sales, parish, district and municipal taxes. Nor do we think the decisions of the Federal Courts, to which he has referred, shake, in the least, the authorities cited above in support of our conclusions. A critical examination of those decisions satisfies us that they are not applicable to the questions at issue in this case, but refer more particularly to penal statutes and the effect of their repeal, which admit of a different and more vigorous rule of construction than can be applied to other laws.

It is, therefore, ordered that the judgment appealed from be affirmed, with costs.


source: Caselaw Access Project

author: Levy, J.

license: Public Domain

text:
    No. 6761.
    Frank M. Taylor vs. Prestidge, Graham & Co.
    A factor baying bound himself to make certain advances to a planter to enable him to raise bis crop, and having taken collateral securities for the reimbursement of the sums to be advanced, is not released from bis engagement by the fact that the planter’s place is subsequently overflowed. The refusal of the factor to continue the advances for that reason, will entitle the planter to damages.
    But the planter having made a settlement with the factor and taken back the collateral securities without any protest or reservation, must be considered as having waived his claim for damages.

      k PPEAL from the Fifth District Court, parish of Orleans. Rogers, il J.

      C. L. Walker and Sam’l R. Walker for Plaintiff and Appellee.
    A contract between a commercialfirm of cotton factors and a cotton planter, for the advancing- and furnishing of supplies for a plantation in the alluvial country, must be held to contemplate and embrace the usual contingencies of flood and drouth.

      In such, contract any exception must he express, and cannot he implied, and no mental reservation on the part of the one not communicated at the time to the other can affect the contract.
    "When the amount or sum for supplies and funds is guaranteed hy a deposit of ample col* lateral security to insure against any risk or contingency of flood, the eventuation of the very risk secured against cannot impair the extract.
    The waiver of a legal right must he expressly declared in terms, and cannot he inferred nor implied. C. C. 2199, 2204.
    "Whore the defendant claims a renunciation or waiver made hy plaintiff, it must he specially pleaded.

      Miller, Finney & Miller for Defendants and Appellants.
    The relation between the planter and the commission merchant, accompanied with the deposit hy the planter of his note and collaterals, on which a disoount and a corresponding credit is given to tlm planter hy the merchant, does not oblige the merchant to pay drafts drawn by the planter after his place is overflowed, the crop “drowned out,” and the preparations for the crop destroyed, the relations having been formed with reference to no.snoh event as an overflow, the indneementfor the merohant to pay the drafts, being to secure tbe commissions on the crop, and relyiug on the crop as well as the collaterals for the reimbursement of the advances represented by the discount.
    In cases of contract, where damages are claimed for the breach, supposed profits based on speculative opinions cannot be allowed.
    Nor are damages allowed, not foreseen and not tbe direct consequences of the breach.
    In oases of contracts to pay money the breach involves interest only, the fixed measure of damages, and even if defendant were bound to pay the defendant's draft after the overflow, the protest would involve only the payment of interest. C. C. 1935.
   The opinion of the Court was delivered by

Levy, J.

Plaintiff claims of the defendants ten thousand dollars damages, which he alleges he has sustained atjiheir hands, for the following reasons: That in February, 1874, he delivered to them his promissory note for $5507 58, payable to the order of defendants’ Arm on the 20th November, 1874, bearing eight per cent interest from maturity; that in accordance with agreement between them to that effect, Prestidge, Graham & Co. received said note as an equivalent for $5000 currency, cash, said firm discounting, or pretending to discount, the note and agreeing to place the sum of $5000 to the credit of plaintiff, and defendants then and there contracted to pay such drafts, orders or bills as plaintiff would wish or require during the planting season to the extent of said sum of $5000, this sum being considered as the proceeds of the said note, thus discounted; that plaintiff in order to secure the payment of said note, deposited with said firm certain notes of D. Muir & Co., secured by mortgage upon a valuable plantation in Carroll parish, which mortgage notes were for the aggregate sum of ten thousand dollars; that plaintiff was a cotton planter in the parish of Carroll, in this State, and defendants are engaged in the business of cotton factors, and said negotiations were for the purpose of enabling petitioner to carry on his plantation and make a cotton crop, and defendants were to act as his merchants, factors and brokers to the extent stipulated; that in accordance with the arrangement, plaintiff drew various drafts at various dates from the 19th February to the 11th March, 1874, amounting to the sum of $1746 82, which were duly paid by defendants out of said sum of $5000, before placed to his credit; that on or about the 17th of March, plaintiff having drawn a draft upon defendants for about $237 44, dated 11th March, 1874, the defendants suddenly and without notice to plaintiff, withdrew from said arrangement and violated said contract, and refused to accept and pay said ’draft, but caused the same to be protested, and thereafter continually refused to pay any demand of your petitioner, or to pay to him any amount of the balance of $5000, which had been, as above stated, placed to plaintiff’s credit; that in consequence of said protest, plaintiff was materially injured in his credit, and in consequence of the violation of the contract by defendants, he became unable to complete his requirements for the season’s planting, and was unexpectedly deprived of the means to carry on his plantation and produce the crop which he would have done with the means contracted for with defendants, and that the loss, damage and injury incurred by petitioner, directly in consequence of defendant’s wrongful acts, amounts fully to the sum of $10,000; that on or about the 4th of November, 1874, plaintiff applied to defendants for his said note and account and collaterals, and defendants demanding payment of their account for the advances mentioned, amounting to $1888 16, plaintiff paid the account and received his said note and collaterals. Plaintiff prayed judgment against defendants, in solido, for said sum of $10,000 with legal interest from judicial demand, and for costs.

Defendants, in their answer, averred that by reason of the representations made to them by the plaintiff, that his crop of cotton for the year 1874, upon his plantation, in the parish of Carroll, would be four hundred bales, that it would be shipped to them for sale as commission merchants, and in consideration of the inducement of said crop, its shipment and the commissions thereon, held out by plaintiff, these defendants made advances to him for said plantation at various times up to 1st March, 1874, to the extent of $1746 82, and defendants admit that to secure said advances made by them, the plaintiff delivered to them the promissory notes referred to in his petition; that on the 1st of March, 1874, and for some time thereafter, the said plantation was completely overflowed, rendering it impracticable to make any crop thereon and none was made ; that upon this overflow occurring, they, as they allege had a right to do, declined plaintiff’s solicitations for further advances, that subsequently the plaintiff paid the amount of said advances, viz, $1746 82, whereupon said promissory notes held by them to secure said amount were delivered to him and all transactions closed between them.

Defendants deny that they incurred any obligations whatever to make advances to plaintiff, or to pay his drafts, or that they are liable to him in any manner whatever, and pray for judgment in their favor.

The case was tried by a jury, and there was a verdict in favor of plaintiff for the sum of $5000, with legal interest from judicial demand and costs of suit. A motion for a new trial was made by defendants on the ground that the verdict was contrary to the law and the evidence, which motion was sustained and a new trial granted. On the second trial, the jury rendered a verdict similar to that rendered on the first trial, and defendants have appealed.

The evidence satisfies us that the contract, as alleged by the plaintiff in his petition, was entered into and agreed upon between the plaintiff and the firm of Prestidge, Graham & Oo., the defendants. The defendants agreed to advance to plaintiff the sum of $5000, to enable him to make a crop of cotton in the year 1874, plaintiff estimating his probable crop at four hundred bales, and representing this to defendants, with the hope and expectation of receiving this crop and disposing of it in their business as commission merchants, defendants agreed to make the advances required, and in order to secure themselves fully in such advances, they required and obtained from plaintiff, in February, lo t ±, uis note, payable in November, 1874, for an amount covering the $5000 and the discount thereon, and as further security received from plaintiff, as collateral, certain mortgage notes, signed by a third party, amounting to $10,000, and carried the amount of plaintiff’s note, less the discount, to his credit on their books. We consider that defendants, relying not alone upon the probable crop, but also upon the collaterals held by them, were bound by a contract to advance to plaintiff the amount which they had placed to his credit on their books and which they held subject to his order. They had bound themselves unto plaintiff to that extent, and good faith required them to comply with their contract; otherwise, they would have taken an undue advantage of plaintiff. They would take all the chances -in their own favor and leave the plaintiff at the mercy of their whim and caprice, if there was, as they allege, no obligation resting upon them to advance to, or pay the drafts of, plaintiff to the extent agreed upon, as evidenced by their placing the amount named to bis credit. They had, probably, by entering into the agreement with plaintiff, put it out of his power to make arrangements with other merchants who would have held faith with him, or he might have made successful negotiations to enable him to obtain the necessary funds for carrying on his plantation by the use, in other hands, of the collaterals which he had placed with defendants.

We think plaintiff had a just cause of action, and the measure of , damages for violation of.contract to the extent of the-injury and loss sustainedbyhim was a proper subject for legal inquiry and adjudication. One, however, may have rights which he can enforce, but these rights may also be abandoned, waived and surrendered. The evidence shows that after defendants’ violation of their agreement and. contract, they offered to return to plaintiff his notes on payment by plaintiff of the amount of the advances made to him, or if plaintiff would give them his note, payable in one year, for 'said amount, they would surrender said notes. This proposition or tender of settlement was made through plan-tiff’s attorneys, and no reply appears to have been then made thereto, either of acceptance or rejection. In November, 1874, the plaintiff, in person, called upon defendants’ firm, paid the amount which had been advanced to him, including interest, and accepted his notes ; the entry of the credit, etc., on defendants’ books was then cancelled; no demand for damages was made ; there was no protest by plaintiff, no representation by him that he made this settlement a payment with reservation of right to proceed against defendants for the violation of contract, but on the contrary, Hardeman testifies that, “in the fall of 1874 the plaintiff called at our office, said he felt very hard toward us for not helping him, but was willing to settle up and quit: We made out his account and he paid us the amount due and we surrendered to him his note and certain mortgage notes of D. Muir & Co. which he had left with us as collateral security for any drafts we should pay for him, exchanging receipts, and the plaintiff expressed himself as fully satisfied ivith the final settlement.” Charles E. Black (then a member of the firm of Prestidge, Graham & Co.) testifies : “ When we stopped paying his drafts we wrote the plaintiff he could have his note for $5000 and the collateral mortgage notes on paying to us the amount due to us, $1746 82, he declined doing that until November, 1874, when he paid us our account, and we gave him up his notes. He made no claim or demand upon us, except to receive his notes on payment of our account, which we complied with.” There is no evidence in the record disproving that above quoted, and nothing to contradict the statements that the settlement mentioned was made as testified to by Mr. Hardeman and Mr. Black. Plaintiff’s own testimony was taken and he does not deny therein these statements. The settlement of the transactions between plaintiff and defendants is shown to have been full and complete, and in complete satisfaction of the respective claims of the several parties. The plaintiff made no reservation of any rights in the premises, no protest, or even intimation that he made the payment of the account of defendants solely for the purpose of getting possession of his collaterals, and the deduction from his own acts and conduct is'to our minds clear that the settlement carried out his expressed intention to “ settle up and quit,” and that he was “ fully satisfied with the final settlement.” It is too late, now, for him to disavow this settlement, especially as there is no allegation that it was made through error or in fraud. For these reasons we conclude that plaintiff’s demand for damages should not have been sustained, and the verdict of the jury and judgment rendered thereon should be set aside.

It is, therefore, ordered, adjudged and decreed that the judgment of the lower court be annulled, avoided and reversed, and that there be judgment in favor of defendants and dismissing plaintiff’s suit, and that the plaintiff, appellant, do pay the costs of both courts.

Rehearing refused.


author: Todd, J.

text:
    No. 6672.
    Samuel C. Baines vs. R. L. Adams et al.
    Drafts drawn by a planter against the proceeds of cotton in the hands of his factor, accepted by the latter and not paid by him at maturity, hut taken up and paid by the drawer, do not constitute a fiduciary debt, excepted as such from a discharge in bankruptcy under the law of the United States.
    Assuming that the original obligation of the factor was of a fiduciary character, about which there is a diversity of opinion, it is clear that it ceased to he so by the drawing and accepting of the drafts, which changed the nature of the debt and were payable to the holder.
    ^PPEAL from the Fifth District Court, parish of Orleans. Rogers,

      T. M. Gill, for Plaintiff and Appellant.
    It is the opinion entertained of the factor’s personal skill and integrity that induces the principal to patronize him. Bussell on Factors, §§ 36, 40 and 44.
    The factor cannot induce a consignment and apply the proceeds to other than the purposes agreed to. 2 An., 26.
    " The relation between factor and principal is not the ordinary relation of debtor and creditor. It is a relation of trust.” 6 A., p. 46. '
    It is a relation essentially fiduciary in its character, and criminal penalties are affixed fox its violation, and the factor is notreleased from the debt by adischarge in bankruptcy. Bev. Statutes, Seo. 905; 25 A., 187; 27 A., 257 ; 28 A., 870; 31 A., 809, 819.

      E. M. Marr, for Defendant and Appellee.
    Thirst — The failure, of a factor to pay the proceeds of sales to the owner of the property, does not create a fiduciary debt, within the meaning and intent of the Bankrupt Act.
    Second — Where the factor accepts the time drafts of his principal, payable to the order of third persons, he ceases to he the debtor of the principal, and becomes the debtor of the holders of the drafts, for the amounts for which they are given.
    Third — Where the principal, after the maturity of such drafts, and the failure of the factor to pay them, pays them himself, the factor, the acceptor, becomes his debtor for the amount; and this indebtedness is created by the failure of the acceptor to pay the drafts, and the subsequent payment of them by the principal, the drawer; and, it is barred by the discharge in bankruptcy.
   The opinion of the Court was delivered by

Todd, J.

This suit was brought in November, 1874, against the late commercial firm of R. L. Adams & Co. after its dissolution. R. L. Adams was alone cited, and the controversy'is between him and the plaintiff. The action is to recover of the defendant the balance of the net proceeds of cotton, alleged to have been sold by the defendant’s firm and not paid over.

The defendant, among other defenses, pleaded his discharge in bankruptcy under the bankrupt act of 1867; and on this plea judgment was rendered in his favor, rejecting plaintiff’s demand; from which judgment this appeal was taken.

The only question for solution by this Court is, whether the debt sued for is excepted from the operation of the discharge in bankruptcy; and this involves the construction of section 33 of the Bankrupt Act of 1867, which provides:

“ No debt created by fraud or embezzlement of the bankrupt or by his defalcation as a public officer, or while acting in any fiduciary character, shall be discharged under this act.”

The Bankrupt Act of 1841 contains a provision similar to the above. It excluded from the operation of the discharge “debts which have been created in consequence of a defalcation as a public officer, or as executor, administrator, or guardian or trustee, or while acting in any other fiduciary capacity.”

U. S. Statutes at Large, vol. 8, p. 441.

These provisions of the two bankrupt acts have been the subject of several decisions of the Federal and State Courts, in which the question of their construction was directly adjudicated upon.

The leading case decided by the Supreme Court of the United States under the Act of 1841, was that of Chapman vs. Forsyth, 2 Howard, 202. It was held in that case, that a factor was not within the exception declared in the act, because the “ ‘ cases enumerated,’ ‘ the defalcation of a public officer,’ ‘executor,’ ‘administrator,’ ‘guardian’ or ‘trustee,’ are not cases of implied but special trusts, and the ‘ other fiduciary capacity’ must mean the same class of trusts. The act speaks of technical trusts, and not those which the law implies from contracts.”

This construction was adopted by this Court in case of the Bank of Manchester vs. Buckner, 2 A. 1023.

There has been no decision of the Supreme Court of the United States on the corresponding provision of the Act of 1867; the cases of Neal vs. Clark, 5 Otto, 704, and Wolf vs. Stix, 9 Otto, 7, referring alone to that part of the clause of the Act of 1867 which relates to “fraud,” and deciding that constructive fraud is not within the meaning of the act.

The question has, however, come up before the United States Circuit Court, and several of the State courts.

In the case of “In re Kimball, 6 Black, 292, before the United States Circuit Court, sitting in New York, where a quantity of flour had been received on consignment and sold, and the proceeds not paid, Mr. Justice Nelson, as the organ of the Court, held: "That the debt was of a strictly fiduciary character, and the defendant was not entitled to his discharge.” This case involved but a single transaction between the parties.

On the contrary, the United States Circuit Court, sitting at Charleston, Chief Justice Waite rendering the opinion, ruled that the debt due by a factor or commission merchant was not, one of those exceptional debts fróm which the party was not discharged by his bankruptcy.

This has been followed by a decision of Mr. Justice Strong to the same effect. There has been, however, no decision of the Supreme Court of the Uuited States on the subject, at least touching the construction of the Act of 1867 on this point.

We find the same contrariety of ruling, in this regard, in the State Courts as in the Federal Courts.

This Court in three cases, Banning vs. Bleakley & Co., 27 A. 257, Brown vs. Garrard & Craig, 28 A. 870, and Desobry vs. Tete, 31 A. 819, has declared, that under the facts disclosed in these cases, the debts were of a fiduciary character, and the debtors precluded from discharge under the bankrupt law.

In the case last cited, Desobry vs. Tete, Chief Justice Manning, the organ of the Court, while he fully maintained the rule that the relation between the factor and his principal, and the debt contracted strictly within that relation, was fiduciary, and debarred the debtor from a discharge, excepted from the operation of the rule a portion of the debt sued for in that case.

The suit in question was to recover a sum left with the factor to be invested for ■ his principal, and for a balance of an account, which had been closed by a note. • The debtor was refused a discharge for the former and adjudged to be entitled to it for the latter, on the ground that the settling of the balance by note had changed the fiduciary character of the debt; and quoad this debt established the relation of ordinary creditor and debtor between the parties.

There is a feature of the case now before us, which is analogous to this branch of the Desobry case, and which is relied on by the defendant as destroying the fiduciary character of the debt, and bringing it clearly within the general rule of the bankrupt act, entitling him to his discharge. It is this: On the 27th of March, 1873, the plaintiff drew upon the defendant, in favor of third persons, four time drafts, maturing respectively on the 27th April, 1873, 29th April, 1873, and 4th January, 1874, aggregating the sum o£ $3479 07; and these drafts were accepted by the defendant’s firm previous to the 15fch of April, 1873, the date at which the account sued on in this case was rendered, and in which these acceptances are charged.

Under the well-settled analogy between bills of exchange and promissory notes, these acceptances were, in legal effect, the precise equivalents of notes drawn by Adams & Co. to the order of plaintiff, and by the latter indorsed and negotiated to third persons. The consideration was the balance due at the date of these bills, and credits accruing thereafter to plaintiff, to the amount of the bills. To this extent, the indebtedness of Adams & Co. after they had accepted the drafts, was not to the plaintiff but to the holders of the bills; and if at any time after the date of these acceptances, and before the maturity of the same, the plaintiff had demanded of E. L. Adams & Co. the payment of the amount of them, they could have legally refused to pay the same, because the amount had become due to other parties by the acts, and at the instance of the plaintiff. Assuming that the indebtedness before was of a fiduciary- character, it was destroyed by the acceptances, under the express doctrine of the Desobry case, from the date of which, and to the amount thereof, and for the time being, other creditors became substituted, to whom the debt became due and payable. It is clear that these third persons, the holders of these acceptances, could assert no fiduciary right against Adams & Co.; nor do we know of any principle upon which the plaintiff, by taking up the drafts on which he was bound as drawer, could restore to life a fiduciary obligation once extinguished.

The slight excess of the indebtness of Adams & Co. to plaintiff over the amount of the acceptances has been more than extinguished by payments made on account; and the balance, embracing the claim in suit, is barred by the discharge in bankruptcy.

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


author: Bermudez, C. J. Bermudez, C. J.

text:
    No. 7922.
    Life Association of America vs. G. L. Hall.
    The Court of ordinary jurisdiction lias tlie power to entertain to final consummation the executory proceedings against a minor’s property. Soyo vs. Price, 30 An., 93, re-affirmed.
    An inventory of the minor’s property, as a pre-requisite to a partition, is not indispensable when there is only one piece of property to he partitioned.
    .Property held in common with a minor and sold under a judgment in a partition suit, may be sold regardless of appraisement.
    When property, in which the natural tutor has an undivided share, is sold to effect a partition. there is no law of the State which authorizes the referring of the legal mortgage of the minor to the proceeds of the sale. The mortgage shall remain attached to the nn- ' divided portion of the property which belonged to the tutor, until the removal of it by means of the special mortgage provided for by law, or the extinction of it by settlement of the minor’s rights at his majority. The purchaser, in the meantime, takes the property subject to the minor’s mortgage, and retains in bis hands the price of the tutor’s share.
    Lecarpentier vs. Lecarpentier, 5 An , 497, affirmed.
    The application of an Amicus curice for a Re-hearing, though made within the six judicial days, does not retard the finality of the judgment of this Court.
    APPEAL from the Fifth District Court, parish of Orleans. Rogers J.

      Gibson, Hall & Montgomery and & S. Carlisle for Plaintiff and Appellee.

      T. M. Gill for Defendant and Appellant.

      Breaux & Hall, Amici curice.

   The opinion of the Court was delivered by

Bermudez, C. J.

The object of this suit is to compel the defendant to a specific performance, by 'complying with the terms upon which he agreed to purchase from the plaintiff the real estate described in the petition.

It is admitted by the defendant that he consented to buy the property, but he charges that plaintiff’s title is not such as he is bound to accept.

It appears that the real estate in question formed part of the assets of the community, once existing between John C. Stickney and his wife, which was dissolved by her death, she leaving a minor child.

The father qualified as tutor by nature, and the proper mortgage inscriptions against him as such were made.

. Subsequently, treating the community and succession as thoroughly liquidated and the real estate in question as belonging, in Tcind, share alike, to himself as surviving partner in community and to his minor son, as sole heir of his deceased wife, Stickney was authorized as tutor, by a family meeting held on behalf of the minor, to borrow for account of the latter, the sum of twelve hundred dollars and to secure its payment by special mortgage on the undivided half inherited by his son. The sum was procured and the mortgage was consented. At maturity the creditor, remaining unpaid, proceeded by executory process, before a court of ordinary jurisdiction, to have the mortgaged property seized and sold and became the adjudicatee of it. The plaintiff, purchaser, thus becoming the owner of the minor’s undivided share, which- had sold for less than the claim, instituted a suit in partition against his co-owner, Stickney, and obtained a judgment decreeing the sale of the entire property, which was not susceptible of a convenient division in kind. ■

In February, 1879, guided by the light then thrown on the jurisprudence in matters of partition, by the ruling made in January, 1878, in Boutté vs. Boutté, 30 A. 177, since affirmed in Buddecke vs. Buddecke, in 31 A. 574, the plaintiff brought that partition suit before a court of ordinary jurisdiction. At the public sale the plaintiff became the adjudicatee of Stiekney’s half, and so the sole owner of the entire property.

Finding that half incumbered with the general mortgage registered in favor of Stickney’s minor son, the plaintiff took a rule on Stickney as tutor, to show cause why the mortgage should not be referred to the proceeds, and why the inscription from which it resulted should not be cancelled. The rule was made absolute. The defendant refuses to take the title offered him by the plaintiff on four grounds :

1st. The executory proceedings to coerce payment of the amount due by the minor and secured by mortgage on his undivided half of the property, were carried on before a court of ordinary jurisdiction ;

2d. The judicial partition provoked by the plaintiff as adjudicates and purchaser of the minor’s undivided half, against Stickney, the co-owner, was not preceded by an inventory;

3d. The property was adjudicated, without having been previously appraised at all, and therefore regardless of evaluation ;

4th. The proceeding, by which it is attempted to refer the minor’s mortgage to the proceeds of sale of the tutor’s half, was carried on uncontradictorily with the father, tutor, and not with the undertutor, the father, tutor, further, having no authority to receive the proceeds of sale of his own encumbered property and give a valid discharge of the mortgage.

First. The court of ordinary jurisdiction had a right to entertain, to final consummation, the executory proceedings. 28 A. 753. It could have done so if the debt had been a community or succession debt, a fortiori, could it do so where the debt had been contracted for account of the minor after the death of his mother, from whom he had inherited the share subsequently mortgaged, and after he had, through his tutor, taken possession of her succession? Whatever contrarieties once existed on the subject were finally adjusted in Soye vs. Price, 30 A. 93, which has now become a rule of property. Also, 31 A. 52, 112, 574.

Second. It is not conceived that in a case in which there is nothing but a small improved city lot to be partitioned, not susceptible of a convenient division in kind, the law requires the taking of an inventory. It was decided, where an inventory was considered necessary that it could be made after a judgment in partition. The provision of the law in such matters appears to apply only to cases in which there are several pieces of property to be partitioned by sale or allotment. The inventory in such cases is intended to enlighten the court, after hearing testimony, or receiving the routine report of experts touching the conveniency of a division in kind, in order that, when the moment of adjudication arrives, at which the court is to determine the manner in which the partition is to be effected, the court may act more advisedly. C. P. 1024,1027. In tracing the minor’s title to his mother’s estate, it is found, however, that an inventory was taken some years before; no one asked a re-appraisement of the property.

Third. That real estate held in common with minors can be validly ‘sold under a judgment in partition, rendered by a competent court, after due proceedings, and contradictorily with proper parties, regardless of any appraisement, and to the highest and last bidder, can no longer be considered an open question. 7 L. 316; 8 L. 179; 13 L. 431; 2 A. 553; 14 A. 157; 15 A. 697; 12 M. 185; 21 A. 253; 30 A. 1012; 31 A. 572; R. C. C. 345 (339); Troplong, Vente, vol. 2, 873.

Fourth. The last objections are of a more serious character, and deserve full consideration.

An inspection of the mortuary proceedings in the succession of Mrs. Stickney, shows that the property composing the assets of the community, in which she had a residuary interest only, consisted solely of the real estate in question, valued at $3500, and of some movable effects, appraised at $262.

It is a principle deeply embedded in our law and jurisprudence, that the minor’s general mortgage on the property of his tutor is intended to secure not only the past but also the future indebtedness, and the faithful administration of the tutor. R. C. C. 3314 (3282); 7 M. 365; 5 A. 565; 7 A. 545-6; 12 A. 78.

It is apparent, in this case, that the tutor has received for account of the minor twelve hundred dollars, the amount of the loan already mentioned, and has in his possession the movable effects inventoried, and which were valued at the time at $262.

The mortgage affecting the tutor’s undivided half of the real estate in question had for its object, in law, to secure the rendition by him to the minor, when becoming of age or fully emancipated, a correct and satisfactory account of his administration of that money and those effects, and, besides, of whatever other assets might thereafter come to his hands for account of his son.

The law has wisely provided, however, that such mortgage shall not be absolutely a dead weight on the property of a tutor, but can be removed and restricted by the substitution of a special one, to be given after strict compliance with certain prescribed formalities. R. C. C. 325, 230. The effect of such mortgage is simply restrictive and not destructive. 15 A. 417; 9 A. 195; Troplong, Hyp., vol. 2, No. 644; 2 L. 536; 17 L. 194; 15 L. 218; 17 L. 194; 2 A. 657; 19 A. 57,177; 26 A. 144. The inference then, perfectly logical, is that, unless such special mortgage be given and substituted, the general one remains in full vitality.

It does not appear in this case that there exists any mortgage, recorded against the tutor’s half, enjoying priority over that of the minor.

The tutor could not have removed the general mortgage, unless by substituting to it a special mortgage. A creditor of his, enjoying priority over the minor, might have done so; C. P. 170,12 A. 361; 6 R. 51; 13 A. 508; but any one, purchasing the tutor’s share, either á Vamiable or at public judicial sale; provoked by a co-proprietor, could not exercise greater rights than the tutor himself could have done. Even if he could have done so, the result could not certainly be accomplished by a proceeding against the tutor, who had an interest, clashing with that of his minor son, in having the encumbrance removed, so as to enable him to receive the proceeds of the sale of his own mortgaged property. This could the less take place in the case of a tutor who furnishes no bond at all, and who cannot be forced to give any. 12 A. 361.

It has been decided that, where an heir mortgages his share of inheritance, the mortgage, under a sale to operate a partition, is shifted to the proceeds; 27 A. 125; 21 A. 253; but those rulings were made in cases in which, pursuing rights, recognized in them by Art. 3399 (3362), the creditors, by seeking the proceeds, ratified the sale, and on receiving payment released all their privilege or mortgage claims. Whether, in the case of a sale to operate a partition among co-heirs, or any class of co-owners, the mortgage creditors could be driven, against their will, to accept the proceeds, in order to clear the property and pass it unencumbered to the adjudicatee, is a question which has not, that we know, been as yet clearly adjusted, but it does not now appear to us why it should not be so, if the sale was truly a judicial one, made after compliance with all legal prerequisites; for it is manifest that the creditors, having the ability to protect themselves, admonished by thirty days’ advertisement, by bidding on the property to its value, or otherwise doing that which might insure an advantageous sale, and having the power of receiving payment, could be required to confine their mortgage to the proceeds of sale.

It is clear that a mortgage granted by an heir on his undivided share of the property inherited by him, cannot prevent his co-heir from suing for a partition of the same, 9 A. 212; and that the mere fact of such sale, which is not probate in character, does not raise the mortgage encumbering the same. 26 A. 690; 31 A. 506. In probate matters, when the sale is ordered at the instance of the succession representative or of creditors, the jurisprudence is that the mortgages are referred to the proceeds for satisfaction of the claim thus secured, in due course of administration, 7 A. 612; but tbe rule is not the same in a partition suit, which presupposes a liquidation and final settlement of the succession, as also a definitive determination of what the .residuum accruing to the heirs consists, and a putting in possession.

The case is different where the property, part of which was so mortgaged, is sold by the administrator for the purpose of liquidating and partitioning the estate, as, in such a circumstance, the proceeds stand in place of the property in the hands of the administrator. Succession of Pigneguy, 12 K. 450. It was contended in the case, under a misconstruction of Arts. 1342 and 1343 of the Code of 1825, that the mortgageor would receive the proceeds of his share as. if no such mortgage had been given, but the Court said, that it by no means followed that the relative nullity of the mortgage could avail or enrich the .mortgageor at the expense of tbe hypothecary creditor. Besolutio jure dantis, resolvitur us accipientis. 21 A. 251.

In 1 A. 236, the Court sanctioned, in a case of dire necessity, the sale of the property of a tutrix, free from the tacit mortgage encumbering it, in favor of the minor children, it being considered that a sale would have had to be ordered if the property belonged to the minors.

In 19 A. 55, the power of the Court so exercised was questioned for very good reasons given, the Court saying : “ If we depart from the law quoted above, enacted to protect and secure the minor’s rights, there is no stopping place; the law would become a vain thing.

In 30 A. 304, the minors’ mortgage was permitted to be postponed in favor of a loan secured by mortgage, to provide for the maintenance and education of the minor, and the minor having enjoyed the benefit of the money borrowed, was at his majority declared estopped from interfering with the rights of property acquired, under such first mortgage, and derived from its foreclosure.

It was .cláimed, in that case, that the ruling in 1 A. 236, had been overruled in 19 A. 55, and the Court said, “if it were so, the ruling,” in the last case, “ was itself overruled.”

It must be confessed, that the rulings of the Court in those cases, practically amounts to judicial legislation, but, in justification, it must be said that they were made in cases of the greatest urgency, on the hypothesis that the property of the tutor, could with his consent, be dealt with, as though it belonged to the minors themselves, lío legislation has intervened to modify these rulings, which in view of the extreme cases in which they were made, are entitled to respect, particularly as they were made in cases in which the minors had been materially bene-' fited. There is no reason why the precedents established in those cases, should not be followed now, in similar instances, under the vigilant eye of the Court entrusted with the protection of minors and of, their rights.

Alter blending together the various, and at times discordant, rulings expounding the law on the subject under consideration, we consider that the adjudication made in the case of Lecarpentier, 5 A. 497, so far as it declares that the general mortgage continues to attach on the tutor’s share, notwithstanding a judicial sale, to effect a partition, and can only be replaced by a special mortgage, and suggests the investment in real estate, under the supervision of the Court, in the name of the tutor, of the proceeds of his share in the property held in common and sold to effect a partition, contains a correct exposition of the law and jurisprudence relative to our system concerning the legal mortgage in favor of minors, and we formally affirm it, with those limitations, in the present case, regardless of the vacillating, vague and unsatisfactory intervening dicta on the subject. 7 A. 9, 612; 21 A. 253; 1 A. 236; 19 A. 55; 30 A. 304.

Ever since 1843 there exists a statute, which is now found in the Revised Code of 1870 as No. 1333, to the effect that all judicial partitions, where the property is divided in kind, the mortgages, liens and privileges existing against one of the co-proprietors shall by the mere fact of the.partition attach to the share allotted the co-proprietors. There never was enacted a statute to the same effect in cases of a partition by sale; there never was made a ruling referring the mortgage to the proceeds without the consent of the creditor. In the case of a partition in kind, all the rights of the creditor are directed against the property allotted, against which he can exercise them.

In the case of a partition by sale, who could receive the price from the purchaser ? The sheriff, who is the executive officer of the Court, no doubt could, but to whom would he be authorized to pay it ? Would it be to the co-owner, to the debtor whose share has been mortgaged ? Surely not. 17 L. 522; 23 A. 617. Would it be to the mortgage creditor, especially if that creditor be a minor ? If so, where is the law, or ruling, that can be invoked to compel that creditor to take it? We find none. How, in a case like the present one, can it be said that the mortgage attaches to the proceeds, when those proceeds are to be paid to the tutor, the debtor himself, whose share was mortgaged to secure the rights of the minor ? If this could be done, the security provided for the protection of minors would vanish.- 23 An. 617.

From the fact that there exists special legislation in cases of partition in kind, referring the mortgage to the property allotted, and that there exists none in cases of partition by sale, it must be irresistibly inferred that in the last case the mortgage is not shifted to the proceeds, and continues to attach to the realty.

In the present instance, the minor is entitled to a general mortgage to secure an amount as yet unliquidated. This mortgage, of course. does not prevent the sale of the tutor’s property, 12 A. 61, 361; 13 A. 508; 6 R. 51; 'C. P. 715; 19 A. 364; for no one can be compelled to hold property in a state of indivisión beyond a certain time, unless the contrary has been agreed upon, R. O. O. 1289 (1215); but that property passes encumbered with the minor’s mortgage, 5 A. 497,19 A. 364, 31 A. 506, which shall remain so attaching until the rights of the minor shall have been liquidated at his majority, full 'emancipation, or death, and then, satisfied to the extent of what may, at such time, be found to be due him by his tutor, C. P. 715; 6 R. 51; 12 A. 361; or the proceeds invested, as intimated in Lecarpentier’s case. 5 A. 497.

The purchaser of the tutor’s share may find this state of things a hardship, but if it be such, he has no occasion to complain, for he is the original creditor of the minor who seized, sold and bought the minor’s-half.

By lending his money on such undivided share, by purchasing the same, and by next acquiring the tutor’s portion, he has voluntarily brought on himself a condition of things from which we admit our inability to extricate him; but we cannot see how he should complain, as he hits the right of retaining the portion of the price accruing to the tutor. Sales of such a character, instead of proving prejudicial, would rather seem to be beneficial, when the right of retention of the price is considered.

We hold that, where there exists no anterior mortgage creditor,, urging payment, the general mortgage of a minor can be removed from his tutor’s property by' nothing short of a special mortgage, given after compliance with all legal requisites on the subject, 17 L. 194; 19 A. 557; 5-A. 497; 26 A. 144; consequently, that the order made by the District Judge for the unconditional erasure of the minor’s mortgage was erroneously made, and therefore is no protection to the purchaser against the' minor’s actual or eventual claim. The purchaser having looked beyond the decree and shown grave irregularities, which hang as a sword over his head, is entitled to this expression of opinion from us. 9 A. 560.

If the general mortgage which the law has created for the protection of the rights of minors, over which it watches with a jealous eye and great solicitude, could be effectually destroyed, as is attempted to be done in the present instance, the shield with which, it is said, that it-covers them, would be nothing but a thin vapor and a real mockery.

It must be humbly acknowledged that our jurisprudence on the last matter set up as a defense is not such as can be referred to with confidence and satisfaction. It may be a cause of regret for tutors, in cases like the present one, that they cannot freely dispose of their real estate, disengaged of the mortgage in favor of the minors, whose persons or property are in their charge. Such regrets may be largely shared by their creditors or by persons associated with them as co-owners, but with those inconveniences we have nothing to do. They are exposed to the same unpleasant embarrassments by which their debtors or co-proprietors are themselves incommoded.

The defendant cannot be compelled to accept the title tendered him by the plaintiff.

It is, therefore, ordered that the judgment of the lower court be reversed, and that there now be judgment in favor of the defendant, rejecting plaintiff’s demand with costs in both courts.

On Application for Rehearing.

Bermudez, C. J.

The defendant, in whose favor the judgment of this Court was rendered in this case, having applied to the clerk for a copy of. the same, and the latter having declined to deliver it, on the ground, that within the six judicial days following the rendition of the decree, an application for a rehearing was made by two members of the bar, as amici curiae, and is still on file undisposed of, the question is submitted to us to know whether such copy should be issued.

We find no application in the record from any party interested in the result of the suit.

The Code of Practice, Art. 912, declares that “ in the interval between the day on which the judgment is rendered and that on which it becomes final, a party dissatisfied with the judgment may apply to the court for a new hearing in the cause.” * * * *

The word “ party” means a party to the suit. The article, then, is to the effect, that unless .a party to the suit apply seasonbly for a rehearing, the judgment shall become final. There is a case, also, in which-a rehearing may be granted, and that is, where the Court proprio motu, or on the suggestion of an amicus curies, orders, before the expiration of the delay, that the case be heard anew.

The Court has not acted proprio motu, or on suggestion, within the six judicial days, and the judgment having become final, in the absence of any complaint from any party to the suit, and being the property of the defendant, C. P. 518, the application made by the amici curies cannot prevent the defendant from obtaining the desired copy.

We cannot consider the petition of the amici curies, and, therefore, cannot allow it. 30 A. 617.

It is, therefore, ordered that the clerk deliver to the defendant a certified copy of the judgment herein rendered by this Court, for-transmission to the lower court, superseded by the Civil-District Court for the parish of Orleans.


author:
Poché, J.
     Poché, J.

text:
    No. 7243.
    George L. Bright vs. The Metairie Cemetery Association.
    Plaintiff having based his suit upon the allegation of a contract of employment of his professional services and of a fixed compensation for the same, cannot be permitted to prove the value of those services before or without proving the contract itself.
    Under tho authorities, after proving the alleged contract of employment, if he failed in tho further proof of the alleged stipulated fee, he might then be allowed to show the value of the services ; but this is not intended to supply the indispensable evidence of the alleged contract itself, in default of which he connot recover.
    A corporation which, by its charter, can only act through its board of directors, cannot be bound to contracts by its president, without the authorization of the board, unless it is in acts of simple administration which, of necessity, should be done without that authorization.
    ■^PPEAL from the Sixth District Court, parish of Orleans. Hightor,

      J. Ad. Hosier and Geo. L. Bright for Plaintiff and Appellee.
    1.The president of a corporation has tho right to employ an attorney at law without tho authorization of the Board of Directors. 2. ,In a suit on a contract and quantum meruit, evidence is admissible to prove the quantum meruit, and to show that -the plaintiff is entitled to recover independently of the contract. 3. When an attorney is employed for a stipulated fee, and is afterwards dismissed by his client without any fault on his part, ho has a right to recover the whole amount stipulated to be paid.

      Breaux & Hall for Defendant and Appellant.
    1. A party suing on a contract, and on a quantum meruit, may be compelled to elect. 12 L. 459; 5 A. 597; 19 A. 13.
    2. A corporation can only act in the order prescribed by the law creating it. THU vs. Op. B. B. Co., 11 A. 293; 2 Cranoli, 168; 12 Wheaton, 34; Angel & Ames on Corp. § 231; do. p. 285, ed. 1866; 2 ¿Tohnson N. X. Bep. 114; C. C. 438, 439.
    3. No evidence of contract with corporation admissible other than vote of the directors according to charter.
   The opinion of the Court was delivered by

Poché, J.

Plaintiff, an attorney and counsellor-at-law brings this suit to recover the sum of $3672 20 for professional services rendered to defendant, under an alleged contract, under which he was retained to relieve defendant, by proper legal proceedings, from the payment of a drainage tax, amounting to $11,016 20, assessed against the lands of the association.

He alleges, that under his contract with the company he was to receive as a contingent fee one third of the amount of the tax from which he would succeed in relieving his client, and that he was presented from completing his full task, in the midst of his labors, by being discharged without cause by the defendant.

The defense is a general denial, coupled with the special averment, that the company’s lands were exempted from any drainage tax by an act of the Legislature passed in 1877.

The defendant has appealed from a judgment rendered in favor of plaintiff for the full amount claimed.

During the trial plaintiff introduced evidence to prove the value of his services, before proving his contract, as alleged, and the testimony was admitted over the objection of defendant, who reserved a bill of exception. The ruling of the District Judge was erroneous, and the evidence was inadmissible.

Plaintiff, having alleged a special contract, cannot be allowed to recover on a quantum meruit. The attempt to prove the value of alleged services, as a general rule, rests upon the hypothesis that the compensation for such services was not determined by the parties in their contract, and is in direct contradiction With the averment in this case, that under the alleged contract the amount of plaintiff’s compensation was fixed at one third of the tax claimed, which he could succeed in saving or rescuing for the company. It is elementary that a party cannot be allowed to administer proofs of facts or allegations not set forth in his pleadings.

Hence it follows, that if a plaintiff sues for services under a special contract, he cannot be tolerated in an attempt to prove up his contract by showing the value of his services. Such value may be shown in support or corroboration of proof of the contract, but not to prove the contract, itself a part of other evidence, to substantiate the agreement as alleged.

Plaintiff having next offered evidence to prove that he had been employed by O. T. Howard, president of the company, defendant objected to any evidence tending to show a contract between plaintiff and the president, or any one else, unless it was first shown that such contracting party was thereto authorized by the board of directors of the company, who could alone bind the association in such a contract.

The objection was overruled, and voluminous testimony was admitted to show a contract of retainer, as alleged by plaintiff, between himself and O. T. Howard, in his capacity of president of the Metairie Cemetery Association; and upon that evidence the District Judge must have predicated his judgment, for the record is barren of any evidence showing the participation of the board of directors in the contract, or any act of such board to authorize their president to enter into the alleged contract in behalf of the company.

We are clear that the court erred in admitting this evidence, all of which should have been excluded.

Plaintiff had specifically alleged that he was retained by the association, without even stating that it had acted through its president, and as a condition precedent to the administration of proof of a contract with the president, it was incumbent upon him to first show that authority had been vested for that purpose in that officer by the corporation, acting in the manner and under the form prescribed by its charter. Section five of the charter provides that “ all the powers of this corporation shall be vested in a board of directors, to be composed of six stockholders, a majority of whom shall constitute a quorum.”

Plaintiff contends that the president of a corporation is, by virtue of his office, authorized to employ counsel without a resolution of the board, and that such retainer may be made by parol agreement, and ho quotes numerous authorities in support of his position.

We have carefully examined these authorities, and we are constrained to conclude that he is not borne out by them in his argument. It is elementary that corporate bodies are artificial beings or persons, who can act only in the mode prescribed by the law creating them, or in the manner specified in their organic law or charter.

It is true 'that in many corporations acts of administration in their ordinary business pursuits can, and must of necessity, be p^^rmed by the president, or other authorized officer, but such authomy must be provided for by special laws, or by stipulations in the charter, and must apply to well defined acts within the essential object or objects for which the corporation was created. Now, in this case, the object of the association was to establish and maintain a cemetery and graveyard, and any act for the regulation of burials or disposition of graves could be performed by the president or other officer entrusted with the administration and direction of business within the main object of the corporation. But this power could not possibly be extended to cover such a contract as forms the basis of this suit. The record shows that the company had a regular attorney, and, in ouropinion.no authority short of the action of the board of directors could justify the president to employ and retain a special attorney, outside of usual legal business, to represent the association in a litigation of great moment and magnitude, which would be rife with vital consequences to the company, and would entail the payment of a large fee.

It appears that plaintiff himself felt that his contract with the president was not complete without the confirmation of the board of directors, and he prudently proceeded to thus crown his edifice. To that end he drew up a written contract, which he proposed to the president for his signature; but it appears that notwithstanding Howard’s willingness to sign the document, he suggested the propriety of first obtaining the authorization of the board, awaiting which he withheld his signature, which has never been affixed to the proposed agreement. But even if he had officially signed the paper, it would yet have been an unmeaning ceremony, lacking the vivifying breath of the board of directors, the only power clothed with the authority to perfect such a contract, and to give it binding force; and it nowhere appears in the record that such authorization was ever procured or obtained by the president or any one else, from the board, either in writing or verbally. And we deeply regret that plaintiff should have stopped short in the prudent course which he had thus mapped out for his own protection, but we must deal with the evidence as we find it in the record.

Plaintiff urges the application in this case of the rule which presumes the employment of a regular attorney , who appears in a legal proceeding. But he fails to recognize a necessary distinction which qualifies this rule in its application, between cases where the attorneys’ authority to appear is to be tested with reference to the effect of their professional acts on the interest of third parties, and cases, when suing for their fees, their authority or employment is specially denied by the parties whom they represented in legal proceedings.

In the latter cases, they must prove a reEainer or contract, as alleged, by legal evidence; and if the alleged contract was with a corporation, the contract must be shown to have been made by the person or persons, duly authorized thereto, for corporate bodies can act or contract only in the manner and form prescribed by law or by its charter. Angel & Ames on Corporations, p. 278; 2 Johnson, N. Y. Reports, p. 114; 12 Wheaton, 34; C. C. 438, 439; 11 A. 293. Plaintiff also attempted to show that the board of directors had ratified the acts of the president in the premises. But the only evidence on that point consists of sundry bills of costs and other charges, made in the name of the association, approved by plaintiff, as its counsel, and paid by Howard, the president. But nothing shows that he was thereto authorized by the board of directors, or that they ever approved or ratified his conduct in that particular; and the evidence thus fails to show legal ratification by the board of the contract sued upon.

■We therefore conclude that plaintiff has failed to prove a contract, as alleged in his petition, and that he cannot recover.

It is, therefore, ordered, adjudged and decreed that the judgment of the lower court be annulled, avoided and reversed, and that plaintiff’s demand be rejected, and his action dismissed at his costs in both courts.

Justice Fenner, having been of counsel in this case, recuses himself.

On Application eor Behearingk

Poché, J.

Plaintiff urges his application for a rehearing of this cause with great earnestness, and supports it in a very able brief, which we have read, with care and interest.

We think that he misapprehends the reasons which underlie our opinion, and amply justify our decree; for he complains of the injustice of our refusal to allow him to prove the value of his services under the agreement which he alleges; and he quotes numerous authorities in support of the doctrine that a party declaring on a special contract, with or without the allegation of a quantum meruit, can and must be allowed to prove the value of the services rendered, of the work done, or of the goods sold and delivered.

We have examined the authorities on which he mainly relies, and fully indorse the doctrine therein demonstrated. But we fail to see their application to this case. In all the cases quoted, the main contract, either of employment or sale, was proved, as alleged, and the only difficulty arose as to the price or amount of compensation, in proof of which evidence was allowed to prove a quantum meruit.

In this case plaintiff declares that he was employed by the defendant corporation to defend a suit, and that his fee was determined at one third of the amount sued for in case of complete success, or one third of the amount saved in case of partial success.

This averment asserts a special contract, containing two distinct elements; first, an employment, and second, the amount of compensation of the services to be rendered.

Defendant’s general denial puts at issue both the propositions, which are essential to plaintiff’s recovery.

To succeed, he must first prove that he was retained or employed as alleged, and in the next place, that this compensation was agreed upon as alleged, or in default of such proof, that his services were worth the amount claimed therefor.

But before proving his contract of employment as alleged, plaintiff attempted to prove the value of his services under the quantum meruit. To this defendant objected, and we maintained those objections. We are clear that in such a ruling we contravene no principle of law, justice or equity, and that we are supported by the very authorities quoted against us by plaintiff in his brief for rehearing. In. support of his contract of employment, plaintiff introduces evidence showing his retainer by C. T, Howard, president of the association, and to this kind of evidence defendant urges objections which are insurmountable.

We cannot sanction the doctrine that the powers of a corporation which are specially entrusted, under the charter, to a board of directors, can be exercised or usurped by the president or any other officer of the corporation.

The record .utterly fails, to' show any action whatever of the board of directors touching or affecting in any manner the contract sued upon by plaintiff, or any knowledge in said board of plaintiff’s appearance in court in the drainage tax suit in behalf, or as counsel, of the corporation.

In rejecting the evidence offered by plaintiff, to show the value of Ms services under the contract alleged by Mm, we desire to be distinctly understood as holding, that had plaintiff proved, by legal evidence, that he had been employed as alleged by the defendant, through or; by the authority óf its board of directors, the only power which could bind the corporation in such a contract, and if, after such proof, he had failed to prove the stipulation for his compensation, as" alleged, it would then have been competent in Mm to prove the-value of Ms services.

But in the absence of proof of any contract of employment by .the defendant corporation, acting in the mode pointed out by its.charter, the door must be closed against any and all evidence of the'value of services rendered without authority from the board.

We, therefore, conclude that our decree must remain unaltered, and the rehearing applied for is, therefore, refused.