author: MOUTON, J. LeBLANC, J.

text:
    Nos. 772-873
    First Circuit
    STANDARD MOTOR CO. v. ST. AMANT
    (May 5, 1931. Opinion and Decree.)
    (June 16, 1931. Rehearing Granted.)
    (December 8, 1931. Opinion and Decree on Rehearing.)

      J. Y. Sanders, Jr., of Baton Rouge, attorney for plaintiff, appellant.
    C. V. St. Amant, of Donaldsonville, attorney for defendant, appellee.
   MOUTON, J.

June 22, 1927, defendant bought a secondhand Dodge sedan from plaintiff company for $650 on which he paid $150 cash, leaving a balance of $432, for which he gave twelve notes of $36 each, payable monthly. He paid six notes and stopped further payments. This, suit is brought against defendant on the six notes subsequently due which represent the balance on the purchase price of the auto.

The prayer in the answer of defendant is for a rescission of the sale, and a rejection of the demand.

The judgment below was for a reduction of the price to the sum of $216, the- amount claimed, which was denied.

Plaintiff appeals.

In a redhibitory suit, the judge may decree merely a reduction of the price. C. C. art. 2544. Ehrlich et al. v. Roby Motors Co., 166 La. 557, 117 So. 590.

In the answer of defendant it is alleged that the auto was in an “unusable condition,” was mere “junk,” and had never run satisfactorily from the time of its delivery. These averments present 'the issue of redhibition which authorized the decree for a reduction of the price, particularly as the evidence introduced in the case was in support of that defense.'

“Redhibition is the avoidance of a sale on account of some vice or defect in the thing sold, which renders it either absolutely useless, or its use so inconvenient and imperfect, that it must be supposed that the buyer would not have purchased it, had he known of the vice.” C. C. art. 2520.

In every contract of sale the seller warrants the thing sold against hidden defects or its redhibitory vices. C. C. art. 2476.

In the case of Crawford v. Abbott Automobile Co., 157 La. 59, 101 So. 871, the court said:

“Unless warranty is expressly waived seller warrants that the thing sold is. fit for the purpose intended.”

In that case in which reference was made to a secondhand machine, the thing sold here, the court said:

“A secondhand article must be fit to do the work intended,” which was approved in Jackson v. Breard Motor Co., Inc., 167 La. 857, 120 So. 478.

In the 157 La., above cited, the court said also that the “buyer n'eed not show particular cause of defects which make thing sold unfit for intended purpose, particularly when that thing is complicated machinery; proof of actual existence of such defects being sufficient.”

Edmonson, the salesman who sold the auto to defendant, says he told' the latter at the time of the sale that it was in first-class condition, but that he did not “guarantee it.” Whether or not he gave any such guaranty, the contract carried with it the implied warranty that it was in running condition and “fit for the purpose intended.” This warranty was necessarily implied in the sale under the ruling in the cases, hereinabove referred to, as there was no waiver of warranty between the parties, expressed or implied. The term “fit for the purpose intended,” we understand to mean the ordinary general use of an automobile, and not for use in any particular calling or business, unless it be so stipulated, as the warranty implied in the contract of sale is subject to any modification by the parties thereto. C. C. art. 1764, par. 2.

The defendant testifies that his troubles with the car began about two weeks, after he had purchased it, which continued to increase until some' time about the month of December or January following the sale when it could no longer be used and when he abandoned it and stopped payment on the seventh promissory note. His testimony is that he spent $300 in trying to remedy the troubles he was experiencing with the car, but all without avail.

P. T. St. Amant, defendant’s nephew, says, about eight or ten days after his uncle had acquired the car in which he (witness) rode daily, the car began to miss and pump oil; that the pistons were worn out, and the rims and tires had to be changed.

Bell Gautreau, a tractor mechanic, having occasion to repair the auto, found that •the rims were bad, which was in July, about two months after the sale. He had to take the cylinder head off the motor; says the pistons, were loose, and that a valve was burned; that at every week-end there was some trouble with the car.

Breaud, an auto mechanic, says, when he first worked on the car, November 2, 1927, lie had to replace eight valves, and later, in the following. January and February, had to install on the car a timer, a cylinder gasket, and one valve. This mechanic admits tnat running a car without oil or water could, to a certain extent, place a car in that condition.

Stanhope, a general mechanic of long experience, and who operated a garage at Gonzales, worked on the car at various times. His. testimony is that the exhaust valves were burned out, that the wiring “was rotten,” and that he worked so often on the car that, to use his expression, “it was a botheration to me.” Stanhope was living at the time in Gonzales near the office of the defendant, Dr. St. Amant. He says he remembered when the defendant bought, about June, 1927, a- Dodge touring car. He says, however, that to the best of his knowledge defendant owned no other Dodge car at that particular time. His, testimony shows that his work was done on the Dodge sedan, the car in question.

Counsel for plaintiff contends that the condition in which the car was, as reflected by the testimony of these various witnesses, could have been brought about by a variety of causes.

Breaud, testifying for defendant, said that running a car without water or oil could place it in .that condition. There is no evidence to show that either- the defendant, Dr. St. Amant, or his nephew, who drove the car almost every day after its purchase, ever ran the car without water or fuel. There may be other causes which might bring about the condition which made its appearance in the car soon after the defendant began operating it. Such causes, if they existed, are not pointed out in the record, and, in reference thereto, we must say that there is no intimation whatsoever in the evidence, showing that the deplorable condition of that car was in any way the result of either careless driving, rough treatment, or inattention by defendant. On the contrary, it is shown that, from the time the first trouble was noticed by defendant, about two weeks after he had bought it, the bad condition of the car continued to increase until the following December or about that time, when it would not “run at all,” was abandoned, and refusal to pay the seventh note followed.

•The defendant testifies that work was done on the car in every garage from Gonzales to St. Amant, and that he actually spent $300 in his vain efforts to remedy the defects which interfered with the running of the car, finally culminating in its abandonment.

We think that plaintiff when it sold the car thought it was in running condition, otherwise it would be hard to explain why the salesman, Edmondson, who effected the deal would have represented it as being “in first class condition.”

No doubt, defendant thought it was at least in running condition, else he never would have purchased it for the general use expected of vehicles of that character.

The causes or defects which soon after the sale affected the running condition of the car, and .some months after actually put it out of commission, were certainly unknown to defendant when he bought it. The early manifestation of these defects which were not caused by defendant, as before stated, existed, as we must infer from the evidence, at the time of the sale or prior thereto,' and were hidden or latent. The sedan sold was a thing of complicated machinery, and in such a case, as was said in Crawford v. Abbott Automobile Co., 157 La. 59, 101 So. 871, the “buyer need not show particular cause of defects which make thing sold unfit for intended purpose,” etc.

Obviously, the running condition of the car could not be seen by defendant at the time of the sale, and could be found out only after it was. used. The latent defects likewise could not be detected at that time and which made their appearance soon after when the car was subjected to the usual service which demonstrated that it was “unfit for the intended purpose.” The defendant, however, not having to show the particular cause of such defects. Crawford v. Abbott Automobile Co., 157 La. 59, 101 So. 871.

Counsel for plaintiff says that when the auto was delivered it was in running condition. Running condition, we think, means a little more than that; a car should keep in running order, at least, for more than a couple of weeks after its purchase, when it has been properly taken care of, as appears. to have been the case herein. The many defects, which soon made their appearance for the reasons hereinabove given, authorize the inference that the defects existed when the car was sold or before.

Counsel for plaintiff cites Civil Code, art. 2530, which says that the buyer must prove that the vice existed before the sale, and that, if it makes its appearance within three days immediately following, it is presumed to have existed before the sale.

The vice or defect in the auto did not appear in this car within three days; if it had, the presumption, of its existence would have sprung into life, but, as we understand the law, the fact that it did not does not cut out the proof by inference from the evidence that the vice existed before the sale, which was the situation in cases cited by counsel, and others where machinery was sold and showed its defects quite a while after the sale.

In order to ground this case on the basis upon which it should be solved, we must revert to the contention of plaintiff that when the auto was delivered it was in running condition. From the language of counsel, it would seem that its delivery in that condition comprised the full extent of plaintiff’s warranty under the sale.

Redhibition in a thing sold is a vice or defect rendering it absolutely useless, or its use so inconvenient and imperfect, it must be supposed the buyer would not have purchased had he known of the vice. C. C. art. 2520. This article clearly defines what a redhibitory vice or defect is, and the consequences therefrom which entitles the buyer to an avoidance of the sale.

Civil Code, art. 2476, provides for the warranty of the seller against the hidden defects or the redhibitory vices of the 'thing sold. If the thing sold is absolutely useless, or its use so inconvenient and imperfect, that it must be supposed it would not have been bought, it follows that the seller has not complied with his warranty. If the thing is so affected, it cannot be considered that the seller has sold a thing “fit for the purpose intended,’’ unless the warranty has been expressly waived, as. held in Crawford v. Abbott Automobile Co., 157 La. 59, 101 So. 871.

Grounding ourselves on this rule of law, and on our application of the evidence, as hereinabove stated, we now pass to the real issue determinative of the case.

In reference to the vital question presented, counsel for plaintiff contends that defendant by paying six of the notes, by his conduct after the sale, and by the effect of letters written plaintiff, he accepted the auto and cannot now repudiate the contract by pleading or urging any defects in the car.

Plaintiff relies confidently on the case of Templeman Bros. Lumber Co. v. Fairbanks, Morse & Co., 129 La. 983, 57 So. 309, to maintain that position; on the case of Champion Shoe Machine Co. v. Antonio Culmone, 1 La. App. page 484, wherein the decision is based on the Templeman case above cited; on the case of Edward C. Hooper v. Dry Hand Mop Co., 1 La. App. 621, in which that principle is recognized and on the case of Bay Shoe Co. v. Nacol, 4 La. App. 58, the last one decided by this court, recognizing the foregoing doctrine.

Plaintiff relies principally on the Templeman case, 129 La. 983, 57 So. 309, 315, which he contends presents many features similar if not identical, to those appearing herein. In that case, it was shown that more than a year after the purchase of the machine, the buyer, being threatened with suit, wrote the Fairbanks Company, its vendor, for an extension of time for the payment of the purchase price. In the letters of Templeman, the purchaser, to plaintiff company, not the slightest- complaint is made about the engine not working satisfactorily, or of the vendor, Fairbanks Company, not filling its contract. Complaints- to the local agent, the record-shows, had been made by Templeman Bros., but- the court-said they should have been made to the home office of the Fairbanks Company, as the agents appeared to have represented their company as mere salesmen, and not in connection with machines already sold and installed.

In this case complaints were made to Edmonson, the salesman of the auto, by Dr. St. Amant, the purchaser, but counsel says it had no legal effect, as they should have been addressed to the home office of plaintiff company at Baton Rouge, only twenty-seven miles away. *

The evidence shows that defendant, not only made complaints to plaintiff’s local agent, hut that about October 1st, some three months after the sale, he sent his. nephew, P. T. St. Amant, to plaintiff’s office in Baton Rouge to lodge his complaint. The officers of the company being absent, St. Amant asked the stenographer to tell them that defendant did not want the car. Sending this messenger to the home office of plaintiff company for the purpose stated indicated very clearly that plaintiff was dissatisfied with the car, and did not intend to accept it. This fact, taken in connection with the previous complaints to Edmonson that the car was not rendering the services expected shows that defendant did not want the car, in which he was justified, considering the condition of the car at that time.

It is true that on January 27, 1928, in answer to a letter from plaintiff pressing defendant for payment, defendant, in a reply to that demand, wrote that “due to my slow collections, is the reason I’m behind with my notes; am trying to force collections since the election is over.’’ The date of this letter corresponds with the maturity of the seventh note when defendant stopped payment. Although the act of sale of the auto provides for the maturity of all the notes, if the purchaser defaulted in the payment of any' one of them, this suit was only instituted in July, 1928, and the answer was filed in October, 1928, more than one year subsequent to the sale, after the prescriptible period had run, precluding an avoidance of the contract for redhibitory defects, and compelling defendant to relief by demanding a reduction of the price.

Defendant admits in his testimony that the first written complaint he made to plaintiff company was by letter of date June 30, 1928, more than a year after the act of 'sale, which was executed June 22, 1927. The probabilities are that defendant got wind of the intended suit which was filed in July, 1928, and addressed that later to plaintiff company, which had allowed the notes to run more than six months after they became exigible by reason of the failure of defendant to honor the seventh note, although the letters of the plaintiff show that it was insistent in demanding the payment of the notes soon after they became overdue.

In referring to the defendant stopping payment of this seventh note, it must be noted that about that time, after making repeated efforts to remedy the defects so as to put the car in a running condition, the defendant then abandoned the car, or stopped using it, because, as he testified, he could not run it at all.

In connection with our reference to the condition of this auto at that time, it is proper to quote from the Templeman Bros., case, as follows: “But,” says the court, “it is impossible from plaintiffs’ conduct and letters to escape - the conclusion that they accepted the engine and are liable for the price, notwithstanding the fact that the machine did not work to -their perfect satisfaction.” The words above quoted which we desire to emphasize are these: “The machine did not work to their perfect satisfaction.”

Here the auto, did not run to the satisfaction of defendant from the very beginning, and, after repeated failures to remedy the defects which had manifested themselves in various forms, it would not run at all, became “absolutely useless,” as expressed in the Code, was, actually abandoned and junked, as it is alleged in defendant’s answer.

Is it fair or reasonable to believe that defendant had finally accepted that- machine in such a condition?

His conduct indicates that he was liberal in the expenditure of his money at the different garages for repairs, thinking that the defects would be finally remedied, and that the machine would be put in running order, but it is impossible to conclude that after he stopped payments, and had abandoned the machine, he was willing to accept it and pay the balance of the purchase price. We must hold otherwise, and affirm the judgment appealed from, which allowed a reduction of the price to the amount sued for and rejected the demand.

ON REHEARING

LeBLANC, J.

We find the case to be properly stated in the original opinion heretofore handed down, and it is unnecessary to here re-state it. 134 So. 279. We find also that we correctly stated what we construe the law to be with reference to the implied warranty that follows- the sale of a secondhand automobile, and that in a suit of this nature the court may decree merely a reduction of the price instead of an avoidance of the sale. We find, however, oh further consideration, that we did not make a proper application of the law •to the facts as we now view them, particularly with reference to lack of formal and serious complaint on the part of the defendant about the (according to him) almost utterly worthless condition of the automobile which developed two weeks after the sale, his continue^ use of i-t under the circumstances, his payment of his notes as they matured for six months, and, finally, his letter written to plaintiff seven months after the sale, which, instead of being a protest against further payments, can hardly be construed into anything else than an excuse for his delay in making remittance and a request for further extension.

Dr. St. Amant states in his testimony on direct examination that “some time in December or January,” meaning December, 1927, or January, 1928, he “quit using the car altogether.” The automobile, as we recall by reference to the original opinion, was purchased June 22, 1927, six or seven months before he claims to have stopped using it altogether. In face of this testimony given by him, we nevertheless find him writing a letter to the plaintiff on January 27, 1928, which, because of its persuasive proof that he must have been mistaken as to the time he claims, to have given the car up, we reproduce in full:

“Gonzales, La. 1/27/28
“Standard Motor Car Co., Baton Rouge, La.
“Dear Sirs: Due to my slow collections, is the reason I’m behind with my notes; am trying to force collections since the election is over.
“Hoping this will be satisfactory,
“Yours truly,
“(Signed) G. S. St. Amant.”

The letter speaks for itself. There is certainly nothing in it to suggest in the slightest degree to the plaintiff that Dr. St. Amant was in any way dissatisfied with his purchase. To the contrary, it expresses an almost direct intention on his part to go on making his payments. If it be conceded that his alleged complaints had been transmitted to the plaintiff, would it not have been reasonable for the latter to assume that whatever trouble the car was giving had been remedied and that everything was now all right?

It is difficult to believe that a business or professional man, especially a country doctor, who is almost in constant need of his car, would go on paying note after note on the purchase price of an automobile and then excuse himself for a delayed payment, if the car was in the condition Dr. St. Amant and his witnesses would have it appear that this car was. It is difficult to reconcile his actions with his testimony. We take Dr. St. Amant’s word for it, when he says that he did have some trouble with the car, but, to use the language of the Supreme Court in the case of Temple-man Bros. Lumber Co. v. Fairbanks, Morse & Co., 129 La. 983, 57 So. 309, which resembles this case in many of its features, his testimony “must be read in the light .of his present dissatisfaction, or, in other words, as exaggerating or aggravating more or less conditions, which did not at the time impress him in the same way.” In that case, it is observed, the seller had knowledge of the defective machinery sold, and was given every opportunity to remedy it, having sent two of their expert mechanics to work on it, both having, remained several weeks trying to make the engine develop the horse power it was represented as having when sold. And yet the Supreme Court held that, as the purchasers had gone on and used the engine for more than a year, during which time they paid several installments, it was too late for them to offer to return it. As in this case, it appears that there had been some complaints made to the local salesman of the dealer, but the court' held that complaints so made could not be made to take the place of a formal putting in default. In the case before us, not only was the seller never given a chance to remedy whatever trouble there may have ■been .with the automobile, but he never had any formal notice from the buyer that there was any trouble at all until the matter had been placed in the hands of lawyers for attention and they had written defendant a letter to that effect. This, as appears from the correspondence, was just a few days prior to the filing of this suit.

It is- true that in the case of Templeman Bros. Lumber Co. v. Fairbanks, Morse & Co., supra, the court, on rehearing, relieved the purchaser from further payments, and in effect decreed a reduction of the price, as did the lower court in this case, but that was because, as stated in the opinion, the seller was held to the full knowledge of the defects in the particular piece of machinery sold, which had been complained of. There is. no evidence here by which the seller could be charged with such knowledge. On the contrary, the testimony is to the effect that, at the time the car was sold, it was in good running order and condition, and the purchaser was given the option, before buying, of having it examined by any mechanic of his own selection.

We have . examined the cases cited by counsel for defendant, and note that several hold that, even after having made several payments on the price of the article bought, the purchaser should be relieved from the sale where there appear defects which make the thing sold so useless or its use so imperfect that it must be supposed that he would not have bought had he known of the vices. But to relieve the purchaser in this case, where the article sold was a secondhand automobile, in good running condition when it was bought and he used it, perhaps experiencing some trouble, but used it, nevertheless, for six months or more, paid his notes as they matured monthly, and even then writes. a letter in which he, in effect, expresses his willingness to make further payments, would be carrying the doctrine stated in the cases cited further than it has heretofore been recognized.

We have reached the conclusion that the original opinion herein handed down was erroneous, and that the decision of the lower court should have been reversed.

For the reasons stated, it is now ordered that the judgment of the lower court which discharged the defendant from further liability for the payment of the notes herein sued on, as. well' as the original opinion of this court affirming the same, be, and they are both hereby, reversed, set aside, and avoided, and, it is further ordered, adjudged and decreed that there be judgment in favor of the plaintiff, Lewis Gottlieb, doing business under the name of Standard Motor Car Company, and against the defendant, G. S. St. Amant, in the sum of ?216, with 8 per cent interest per annum from January 22, 1928, and 10 per cent on the amount of said principal and interest, as attorney’s, fees, and all costs of this proceeding.


source: Caselaw Access Project

author: ELLIOTT, J.

license: Public Domain

text:
    No. 735
    First Circuit
    DECUIR ET AL. v. CARNES
    (January 26, 1931. Opinion and Decree.)
    (March 3, 1931. Rehearing Granted.)
    (October 7, 1931. Question Certified to Supreme Court on Rehearing.)
    (November 3, 1931. Correctness of Original Judgment of Court of Appeal Affirmed by Supreme Court.)

      Weeks & Weeks, of New Iberia, attorneys for plaintiffs, appellees.
    Burke & Smith, of New Iberia, attorneys for defendant, appellant.
   ELLIOTT, J.

The plaintiffs, Prank J. Decuir, A. Mille Decuir, Thomas R. Gayle, Miss Jeanna Decuir, Mrs. Marie Decuir Weeks, wife of Edward T. Weeks, Mrs. Louise Decuir Patout, wife of Wm. S. Pa-tout, proceeded against the defendant, C. E. Carnes, under the Civil Code, art. 2161, to have him, the said Carnes, compelled to accept from them a tender of the amount due him by Jeff Prados on a mortgage note for $307, with interest and attorney’s fees thereon executed and signed by said Prados, and to have themselves, plaintiffs, subrogated of right and by operation of the law to the right, title and interest of the defendant in and to said note and the mortgage whereby it is secured.

The defendant contends that he has the right, before said subrogation is permitted to have effect, to cancel and release from the effect of his said mortgage a parcel of land hereinafter referred to as tract B, and on which the plaintiffs have no mortgage.

There is no dispute about the facts of the case; the dispute is as to the rights of the parties under the law.

The lower court, stating reasons at length for so doing, held in favor of the plaintiffs. Defendant has appealed.

The record shows that defendant is the owner and holder of a note for $307 dated October 2, 1922, drawn and executed by Jeff Prados, secured by a conventional mortgage in authentic form of same date as the note, bearing on the property described as follows, to-wit:

“A certain tract of land together with all the buildings and improvements thereon, situated in the 4th ward of the Parish of Iberia, containing 63 arpents more or less, being the same property acquired by mortgagor from 2enon Decuir.”

This mortgage is, in point of registry and rank, the first and highest bearing on said land,' and covers the entire tract of ■63 arpents, more or less.

The mortgage covers another tract of land, but that fact has no bearing on the question which the court is called on to decide.

The defendant is the owner and holder of a note for $300, with interest and attorney’s fees thereon drawn and executed by said Prados, dated July 16, 1929, and secured by conventional mortgage granted by said Prados in authentic form, of same date as the note, bearing upon the property described as follows, to-wit:

(1) A certain tract of land, together with all buildings and improvements thereon and thereunto belonging, and all appurtenances thereof, situated in the fourth ward of the parish of Iberia, containing 32 arpents more or less, bounded north by public road, south by Texas Oil Company, east by mortgagor, and west by O. E. Carnes or assigns, which tract will be hereinafter referred to as tract A.

(2) Another tract of land situated in the same locality containing 32' arpents more or less, bounded north by public road, south by Texas Oil Company, east by Honoré Prados, and west by mortgagor, which tract will be hereinafter referred to as tract B.

These two tracts last described, taken together, make and form the identical 63-arpent tract herein first above described; the original tract having been divided into two tracts of 32 arpents, more or less, each, since the execution of the said first mortgage thereon.

Plaintiffs are the owners and the holders of a promissory note drawn and signed by said Prados for $565.70, with interest and attorney’s fees thereon, secured by a conventional mortgage granted by said Prados on the property described as follows, to-wit:

“A certain lot of ground together with all the buildings and improvements thereon and thereunto belonging, and rights, ways and appurtenances thereof, situated in the Parish of Iberia, containing 31 and a fraction superficial arpents, bounded north by property qf Fernand Mestayer and Albert Mestayer; south by property of Gustave Loreau; east by that of Gustave Breaussard and west by Jeff Prados,”— which is the same identical tract of land above referred to as tract B.

This mortgage which the plaintiff holds on tract B is, in rank, next after that granted by said Prados on the 63 arpents more or less, in favor of defendant for the purpose of securing said note for $307.

The mortgage situation with reference to the said 63-arpent tract of land shows that defendant, Carnes, has the first mortgage thereon securing said note for $307, and for the purpose of securing his note for $300 he has the second mortgage on tract A. and the third on tract B. And the plaintiffs have for the purpose of securing their note for $565.70 the second mortgage on tract B, but as to tract A they are but ordinary creditors of said Prados.

The plaintiffs hold two other notes for $50 each, drawn and executed by said Prados, secured by a mortgage granted by him on another tract of land. But that matter has nq bearing on the present controversy.

The defendant, Carnes, sued out executory process against said Prados on said note for $307 and mortgage securing same, and caused to be seized and advertised for Sale the 63-arpent tract, together with another tract of land for the purpose of paying same, and on the same day, immediately afterward, he sued out executory process against said Prados on said note for $300 and mortgage securing same, and seized and advertised for sale to pay said note the tracts A and B, all sales to be made on the same day. But he intended, before the sale would have released tract A from seizure, to pay said note for $307 and cancel his said mortgage on said tract in so far as concerned the amount due him on said note. Therefore, if accomplished, his mortgage securing said note for $300 would have become the first mortgage thereon.

The plaintiffs, however, before he could carry out his purpose, tendered to him the full amount due him by said Prados on his note for $307, in principal, interest, and attorney’s fees, and claim as a result of their tender to be subrogated by right and operation of law to the place of said Carnes as the creditor of said Prados on said note fqr $307, and to all the mortgage rights granted by said Prados on said tract of 63 arpents, more or less, for the purpose of securing it.

The defendant, Carnes, refused to accept said tender, unless first permitted to release tract A from the effect of said mortgage, contending that, as plaintiffs have no mortgage on tract A, they have no right to prevent him from releasing said part of the 63 arpents, more or less, from the effect of the mortgage granted by said Prados for the purpose of securing said note for $307.

“Subrogation to the right of a creditor in favor of a third person who pays him, is' either conventional or legal.” Civil Code, art. 2159.

“Subrogation takes place of right:

“For the benefit of him who, being himself a creditor, pays another creditor, whose claim is preferable to his by reason of his privileges or mortgages.” Civil Code, art. 2161.

It seems to* be the meaning of the law that, where the creditor of the common debtor pays the creditor whose olaim is preferable tq his by reason of his mortgage, he becomes of right and by the effect of the law the creditor of the common debtor to the same extent as the creditor who is paid and is entitled in the same way to the mortgage rights which gave rise to the preference.

In Zeigler v. His Creditors, 49 La. Ann. 144, 21 So. 666, cited by the lower court in its opinion, and urged by plaintiffs in their brief, the court held that subrogation of right and by operation of the law, when exercised, entitled the ordinary creditor without mortgage to the place of the creditor who had been paid, and to the mortgage rights which gave rise to the preference. After having considered the matter in the main opinion, the court says again on rehearing (page 187 of 49 La. Ann., 21 So. 666, 684):

“It is insisted on the argument for the rehearing that under our law there is no legal subrogation in favor of the ordinary creditor who pays the mortgage creditor of the common debtor.”

The court then proceeds to go over the ground again, and reasoning out the matter (page 188 of 49 La. Ann., 21 So. 666, 684), says:

“After all, on this question, is not the Code itself enough? Its conciseness of expression, that subrogation takes place in favor of the creditor who pays another whose debt is preferable by reason of his privilege or mortgage, would certainly seem to preclude any aid for interpretation. We think reason and authority, as well as the text of the Code, sustain our opinion that gives the bank in this case, the creditor of Zeigler, the subrogation to that mortgage securing the debt the bank discharged.”

In Hall et al. v. Hawley & Co. et al., 49 La. Ann. 1046, 22 So. 205, 206, the finding which had been made in Zeigler v. Creditors, 49 La. Ann. 144, 21 So. 666, was reaffirmed. We quote from the syllabus as follows:

“The court again affirms that payment of the mortgage debt by the ordinary creditor subrogates him to the rights of the mortgage creditor.”

In Walmsley v. Theus, 107 La. 417, 31 So. 869, 873, the question was again considered, and the case Zeigler v. Creditors, 49 La. Ann. 144, 21 So. 666, affirmed, and the court further said:

“Payment, with subrogation, would result, ipso facto, from the fact of the payment by force of the law itself, independently of any consent thereto by the holders of the note or notes paid.”

It is seemingly evident that the effect of subrogating the plaintiffs of right and by the operation of the law to the place of said Carnes as the creditor of said Prados in the matter of said note for $307, and as entitled to enforce the mortgage rights granted by said Prados for the purpose of securing it, will be to enable the plaintiffs to benefit themselves in a way which will operate to the prejudice of' the defendant's mortgage granted him by said Prados for the purpose of securing said note for $300, and in that connection we noted the language in the Walmsley case, page 427 of 107 La., 31 So. 869, 873:

“There may be occasions where, by reason of special circumstances, the holder of notes would be legally justified in refusing to receive payment of the same from one who, by virtue of the payment made by him would be entitled to subrogation, — cases where such subrogation would work injury to the party receiving the payment, — but this case presents no exceptional features of that kind.”

But the opinion shows that the court, in saying as quoted, evidently had in mind a situation where there were several outstanding notes secured by the same mortgage, and in which all the creditors had the same right on the property; one of them could not, by virtue of the • subrogation, be held to have any greater right than the party from whom he had obtained some of the notes. In this case we can but interpret the law and give effect to its meaning.

The judgment .appealed from is, in our opinion, correct!

Judgment affirmed; defendant and appellant to pay the costs in both courts.


author: HIGGINS, J.

text:
    No. 14,016
    Orleans
    ABELLEIRA v. JOHNSON IRON WORKS CO., INC.
    (November 30, 1931. Opinion and Decree.)
    A. H. Reed and J. L. Warren Woodville, of New Orleans, attorneys for plaintiff, appellant.

      Edward Rightor and William H. Sellers, of New Orleans, attorneys for defendant, appellee.
   HIGGINS, J.

This is a suit by an injured employee to recover compensation under the provisions of the Workmen’s Compensation Law, Act 20 of 1914, sec. 8, as amended by Act 242 of 1828.

The defendant admits that plaintiff was in its employ and engaged in a hazardous occupation; that he was accidentally injured on June 25, 1930, by a heavy piece of iron falling on his right foot, and that he was paid compensation at the rate of $12.65 per week for 23 weeks, but avers that he was discharged as cured of the injury on December 17, 1930, and that the present disability complained of has no causal connection with the original injury.

There was judgment in favor of the defendant dismissing the suit and plaintiff has appealed.

The record shows that the plaintiff was unloading heavy iron bars from a truck and that one of them fell on the instep of his right foot and injured it. He was sent by his employer to Dr. King’s clinic, where an x-ray was taken (which, however, was not introduced in evidence) and that Dr. King diagnosed the injury as a fracture of the fourth metatarsal bone, i. e., the bone that runs from the base of the foot to the toe. The foot was placed in a plaster of paris cast by Dr. King, who became ill and left the city, referring the case to Dr. Brock for attention. Dr. Brock continued to treat the patient and, after a period of two months, removed the plaster cast. Thereafter the foot was' treated by electrical baking, as it was in a sore and swollen condition. Dr. Brock discharged the patient on December 17, 1930, as cured. The plaintiff states that he returned to his work and worked for two days, but, due to the fact that his foot became badly swollen and pained him, he had to give up his employment.

On December 29, 1930, the compensation insurance adjuster sent the plaintiff to Dr. Edward S. Hatch, a bone specialist, who caused two skiagraphs of the injured foot to be made, which he interpreted as showing that there had not been any fracture of the fourth metatarsal bone, as Dr. King diagnosed the case, but that there was a marked hyper-arthritis or a definite hallux rigidus at the right metatarso phalangeal articulation and internal cuneiform; in short, that there was a bony growth on the dorsal surface of the great toe and on the bone that forms the instep, slightly below where the top of a low quarter shoe reaches that portion of the foot; On December 30, 1930, the patient was sent to Dr. Joseph P. Ane, a radiologist, who also made two skiagraphs of • the injured foot, and these pictures showed 'the same condition of the bones of the foot. Dr. Ane, from his examination of these x-ray pictures, also found that the ■ fourth metatarsal bone had not been broken or fractured and reported, as Dr. Hatch had, a bony growth on the internal cuneiform. The patient then went to the Charity hospital for treatment, where skiagraphs or x-ray pictures were again taken and the radiologist of the hospital diagnosed the case as a “chip fracture of the internal cuneiform, with a slight separation of the fragments,” and an injury to the periosteum, the membrane that covers the bone. Plaintiff says that he was treated at the hospital for this injury, even up to the date of the trial on July 2, 1931.

There is no doubt that the plaintiff mutt bear the burden of proving that' his present disability resulted from the accidental injury which he sustained. Womack v. Highway Construction Company, Inc., 18 La. App. 111, 137 So. 210, decided October 19, 1931; Piske v. Brooklyn Cooperage Co., 143 La. 455, 78 So. 734; Cordray v. Standard Oil Co. of La., 9 La. App. 458, 121 So. 220; Elix v. Glassell-Wilson Co., Inc., 9 La. App. 209, 119 So. 147; Youngblood v. Colfax Motor Co., 12 La. App. 416, 125 So. 883; Purvis v. Ware Construction Co., 5 La. App. 684; Dennis v. Fortuna Oil Co., 5 La. App. 709; Bailey v. Gulf Refining Co., 17 La. App. 43, 135 So. 265. Did the plaintiff establish causal connection between the injury and the disability complained of?

The issue which we are called upon to decide in this case is whether or not the diagnosis of the plaintiff’s condition, as shown by the certified copies of the Charity hospital reports introduced in evidence without objection and' unsupported by any medical testimony of the doctors who made them, outweighs as evidence the testimony of defendant’s medical experts, who diagnosed the plaintiff’s trouble to be of a nature having nq causal connection with the injury.

We are of the opinion that the greater weight should be given to the testimony of the two medical experts, who testified for the defendant that the present disability in no way grew out of the injury, because the shadows on the x-ray or skiagraph represent a bony growth on the cuneiform, caused by some focus of infection, and not a fracture of that bone. The doctor who read the skiagraph of the Charity hospital certifies in the report that, in his opinion, the shadows on the x-rays represent a chipped fracture of the cuneiform, a partial separation, and injury to the periosteum. The report does not give his reasons for coming to that conclusion. Since he was nqt produced in court, the record is barren of any explanation of the report.

We, therefore, conclude that the plaintiff has failed to establish causal connection between the injury and his disability, particularly in view of the fact that he bore the burden of such proof.'

For the reasons assigned the judgment is affirmed.


author: JANVIER, J.

text:
    No. 13,959
    Orleans
    GARLAND v. KEEN
    (November 3, 1931. Opinion and Decree.)

      For original opinion, see 18 La. App. 652.
    Henry L. Garland, of New Orleans, attorney for plaintiff, appellee.
    St. Clair Adams and St. Clair Adams, Jr., of New Orleans, attorneys for defendant, appellant.
   ON MOTION TO DISMISS

JANVIER, J.

This matter comes before us on motion filed in this court to dismiss the appeal on the ground that the amount of the appeal bond is. inadequate.

The judgment below was for $466.30. At the time the judgment was rendered, interest apparently amounting to $23.30 had accrued, so that the total amount due in principal and interest was $489.60. Appeal bond in the sum of $700 was furnished. It 'is evident that it should have been for at least $734.40.

Appellant admits the inadequacy of the bond, but, in opposing the dismissal of the appeal, maintains, that, since the passage of Act No. 112 of 1916, sec. 3, as amended by Act No. 284 of 1928, an appeal may not be dismissed at this time for. such cause as appears here, but that proper proceedings should have been resorted to in the court below, as provided by the statutes referred to.

In Hurry v. Hurry, 144 La. 881, 81 So. 378, a motion to dismiss an appeal was filed in the Supreme Court. The grounds urged were that the appeal bond had been prepared on one of the printed forms used for appeal bonds and that it had been filed without the insertion,1 in the blanks provided therefor, of “the name of the surety, the amount of the obligation, the date of the bond, or the date of the judgment appealed from.” The court refused to dismiss the appeal, and, in doing so, stated:

“The appellee should have urged his complaint in the district court, should have had it served upon the appellant, and should have given the latter the opportunity to correct -the errors or furnish a new bond within two legal days after service of the complant. Under the circumstances, and by the terms of section 9 of Act No. 112 of 1916, the appeal cannot be dismissed on account of the errors or omissions complained of in. the motion -to dismiss.”

In a similar situation, in Bilich et ux. v. Mathe, 149 La. 485, 89 So. 628, the Supreme Court said:

“The defendant has moved to dismiss this appeal for irregularities in the appeal bond. He obtained, in the district court, a rule on appellant to show cause why the appeal should not be dismissed; but the rule was not served upon appellant, nor was any further proceeding had in the matter. According to section, 9 of Act No. 112 of 1916, an appeal should not be dismissed for any inaccuracy or error in tbe appeal bond, or for insufficiency of the security, unless the appellant has been put in default, in the district court, in the manner directed by the statute.”

Again, in Smith v. Phillips, 168 La. 408, 122 So. 126, we find that a dismissal was denied in a case in which the • sureties failed to sign the bond itself, having signed only the affidavit with regard to their respective abilities to respond financially, if called upon to do so. The court said:

“Even if this defect in the appeal bond was originally serious, the appellee’s complaint about it comes too late. Act 112 of 1916, sec. 9, p. 241, declares that no appeal shall be dismissed ‘on account of any error in the amount of the bond, or for any inaccuracy or omission in the bond, or for the insufficiency of any surety, or sureties, on said bond,’ unless the appellant -shall have failed to correct the error, inaccuracy or omission, or to furnish a supplemental or additional bond, or surety or sureties, within two days after the appellee has filed a motion therefor, in the court of original jurisdiction, as provided in the second and third sections of the act. No such motion was filed jr opportunity given, in this case. We would have no authority, therefore, to dismiss this appeal, even if we believed that the sureties named in the bond were not bound as sureties by- their signatures under their affidavit.”

Each of the three above-cited cases was decided either before or without reference to Act No. 284 of 1928, which amends section 3 of Act No. 112 of 1916, but the; second act does not in any way amend the first in any particulars 'essential to a decision of this case. We find only two changes appearing therein: First, if the bond is questioned in the court below, appellant is. given four days to furnish a new bond, whereas under the original act he was given only two days. Second, the amended act provides that, if the second bond furnished is found defective, no further opportunity shall be given appellant to furnish a proper one, whereas this contingency was not referred to" in the original act.

Since no question as to the adequacy of the bond was raised in the court below, we think that the reasoning of the three cases to which we have referred is applicable here.

The. motion to dismiss the appeal is denied.


text:
    No. 13,941
    Orleans
    HENRI PETETIN, INC., v. BAUDEAN, INC.
    (November 16, 1931. Opinion and Decree.)
    (January 14, 1932. Rehearing Refused.)
    Bond, Curtis, Hall & Foster, of New Orleans, attorneys for plaintiff, appellant.
    Charles J. Rivet, of New Orleans, attorney for defendant, appellee.
   HIGGINS, J.

Plaintiff, Henri Petetin, Inc., sought to have the court issue an injunction to restrain the defendant, Baudean, Inc., from listing in the telephone directory its former name, Petetin-Baudean, Tne., and also to restrain the Southern Bell Telephone Company from carrying the alleged improper listing.

• The telephone company, in its return to the rule nisi, averred that it had no in-' terest in the controversy, and submitted the matter to the court. The defendant, Baudean,' Inc., filed an exception of no right or cause of action, and also a return to the rule nisi, which was then tried on affidavits submitted by the plaintiff and the defendant. The judge, a quo, sustained the exception of no right or cause of action, and denied the application for a writ of injunction, and dismissed the plaintiff’s suit. Plaintiff has appealed.

There is no dispute about the facts in the case, and, from the petition and affidavits filed by both parties, it appears that Henri Petetin and Henry Baudean caused to be incorporated a corporation by the name of Petetin-Baudean, Inc.,' on July 31, 1916, the objects and purposes of which were to engage in the stationery and office supply business in the city of New Orleans. A disagreement arose between these gentlemen, and Henri Petetin withdrew from the business some time in January, 1927,' and organized the corporation of Henri Petetin, Inc., the objects and purposes of which were to engage in the stationery and office supply business. On January 28, 1927, Petetin-Baudean, Inc., amended its charter by changing the name to Baudean, Inc., and listed with the telephone company both the original and subsequent corporate names. ■ Plaintiff called upon the telephone company and the defendant to desist from the listing of the name of Petetin-Baudean, Inc., as it was unfair competition and designed for the purpose of misleading the public, and, both defendants having refused to comply with this request, the present suit was filed.

The plaintiff contends, that, as the word “Petetin” forms no part of the new name of the corporation, Baudean, Inc., has no right to list the name of Petetin-Baudean, Inc., in the telephone directory, because such improper listing is misleading, and tends to cause the public and prospective purchasers of stationery and office furniture to believe that Henri Petetin, the president and major stockholder of t'he plaintiff corporation, is still connected with Baudean, Inc., whe'n, in fact and in truth, he is engaged in a competing business.

Defendant contends that.,-it is a prior trader, and,- as such, entitled to all of the trade and good will built up under the name of Petetin-Baudean, Inc., and the fact that it changed its corporate name does not deprive it of its property rights, which it acquired under the prior name of Petetin-Baudean, Inc., and that it is entitled in law and equity to enjoy the good will, trade, and reputation acquired under that name.

The rule of law applicable to the case iconcisely stated by the court in Borden Ice Cream Co. et al. v. Borden’s Condensed Milk Co. (C. C. A.) 201 F. 510, 513, as follows:

“Relief against unfair competition is granted solely upon the ground that one who has built up a gpod will and reputation for his goods or business is entitled to all of the resultant benefits. * * *
“The question to be determined in every case of unfair competition is whether or not, as a matter of fact, the name used by •the defendant had come previously to indicate and designate the complainant’s goods. * * *
“It has been said that the universal test question in cases of this class is whether the public is- likely to be deceived as to the maker or seller of the goods. This, in our opinion, is not the fundamental question. The deception of the public naturally tends to injure the proprietor of a business by diverting his customers • and depriving him of sales which otherwise he might have made. This, rather than the protection of the public against imposition, is the sound and true basis for the private remedy. That the public is deceived may be evidence of the fact that the original .proprietor’s" rights are being invaded. If, however, the rights • of the original -proprietor are in no wise interfered with, the deception of the public is no concern of a court of chancery.”

In Chas. S. Higgins Company v. Higgins Soap Company, 144 N. Y. 462, 39 N. E. 490, 491, 27 L. R. A. 42, 43, Am. St. Rep. 769, the court said:

"* * * An injunction lies to restrain the simulation and use by one corporation of the name of a prior corporation which tends to create confusion, and to enable the later corporation to obtain, by reason of the similarity of names, the business of the prior one.” See, also, Herring-Hall Marvin Safe Co. v. Hall’s Safe Co., 208 U. S. 554, 28 S. Ct. 350, 52 L. Ed. 617; Mobile Transfer Co. v. Schwarz, 195 Ala. 454, 70 So. 640; 38 Oyc. 771.

The rule is stated as follows in 14 Corpus Juris, p. 332:

“A corporation which purchases all the property and franchises of another, except its franchise to be a corporation, acquires its good-will, and with it the right to use its name in such manner as to indicate that it is the successor of the corporation whose business, and good-will it has purchased, and may sue, even though not at present using the name, to enjoin another corporation from using the same.” Metropolitan Tel., etc., Co. v. Metropolitan Tel., etc., Co., 156 App. Div. 577, 141 N. Y. S. 598; Slater v. Slater, 175 N. Y. 143, 67 N. E. 224, 61 L. R. A. 796, 96 Am. St. Rep. 605; Steinfeld v. National Shirt Waist Co., 99 App. Div. 286, 90 N. Y. S. 964.

Applying the above rule of law to the present case, we observe that the plaintiff organized a competitive business subsequent to the creation of the defendant corporation and adopted a name sufficiently similar- to the original name of the defendant, under which it (defendant) had built up its business, tending to cause confusion, not only on the part of old customers, but prospective ones. In order to obviate any loss of patronage, and to let its former and future patrons know where its business was located, the defendant simply carried the listing of its original name in the telephone directory. The defendant being a prior trader, and having established a business reputation and good will under its original name for a number of years in this particular kind of business, and the plaintiff thereafter having organized a competitive business and adopted a similar name, the latter is not entitled either in equity or law to injunctive relief.

We are of the opinion that the exception of no cause or right of action was properly sustained.

For the reasons, assigned, the judgment is affirmed.


text:
    No. 13,918
    Orleans
    KELLER v. N. O. PUB. SERVICE, INC.
    (December 14, 1931. Opinion and Decree.)
    J. Rosenberg and Woodville & Woodville, of New Orleans, attorneys for plaintiff, appellant.
    Ivy G. Kittredge, of New Orleans, attorney for defendant, appellee.
   HIGGINS, J.

This is. an action ex delicto by a pedestrian to recover damages for personal injuries, loss of earnings, medical expenses, etc., said to have resulted when a street car of defendant company ran into and knocked him down at the intersection of Rampart and Canal streets, this city, on April 2, 1930, at 11:15 a. m.

The petition alleges that defendant was at fault in operating the car at an excessive rate of speed; that the motorman did not keep a proper lookout; that the street car approached plaintiff from the rear and suddenly ran him down without giving any signal or warning of its approach; and that plaintiff had the right of way as the green semaphore light was in his favor; and that the motorman violated the provisions. of section 14 of Ordinance 7490, C. C. S., by turning into the intersection against a red light.

Defendant denied the respective charges of negligence, and specially pleaded that plaintiff was guilty of contributory negligence in walking into the side of the street car.

There was 'judgment in favor of defendant dismissing the suit, and plaintiff has appealed.

The record shows, that plaintiff was walking on the uptown river sidewalk of Canal street in the direction of the lake; that upon reaching the intersection of Rampart street he started to cross to the lower side of Canal street when the green traffic signal was in his favor; that the street car which was proceeding towards Canal street on Rampart street came to a stop on the uptown side of Canal ^street, where passengers were received and discharged; that the street car then started across the intersection as the green traffic light showed in its direction; that South Rampart and Canal streets intersect each other at right angles, and both have neutral grounds in the center on which are located street car tracks with paved roadways on each side thereof; that the track on which the street car was proceeding turned from South Rampart street across the uptown roadway of Canal street to the neutral ground on Canal street and thence on the neutral ground towards the river; that there are lines on the pavement indicating the path pedestrians must pursue in crossing the street; and that this path leads directly over the street car tracks at the point “where it reaches the neutral ground.

We shall first discuss, the charge that the motorman attempted to negotiate the crossing on a red light and contrary to section 14 of the traffic ordinance. Section 14 reads as follows:

“Police Semaphore Signals. The following semaphore signals for the movement of traffic are hereby established.
“(a) Red — when shown on any traffic signal, illuminated or otherwise, shall indicate that traffic shall stop, and remain stopped as long as the red signal is shown.
“(b) Green — when shown in any traffic signal illuminated or otherwise, shall indicate that traffic shall move in the direction of the signal, and remain in motion as long as the signal is shown.”

Plaintiff contends that the street car, under the provisions of paragraph (b) of the above-quoted section, should have proceeded into the curve as long as the street car was facing the green semaphore signal, but, when it started to turn towards the neutral ground so that the. street car then began to face the red light, it should have stopped, since the motorman was then confronted with the red light which required him to stop.

The record shows that there was no place where the' street car could have stopped, upon approaching the neutral ground after the cart had negotiated enough of the curve so that the motorman could have seen the red light, and that, had the motorman stopped at such a point, as the street car was 47 feet in length and the roadway was.' 38 feet in width, the car would have blocked both vehicular and pedestrian traffic in the intersection.

There is no doubt under the language of the ordinance that the street car had a right to leave Rampart street and turn into Canal street because it was moving in the direction of the green signal, which directed traffic to move in the direction of the neutral ground. The street car had a right to remain in motion until it completed the crossing. The mere fact that in reaching the neutral ground it was necessary for the street car to diagonally cross the path of pedestrians did not deprive the car of its right to continue on its course, since it was proceeding on a green light. Furthermore, the street car would not be completely confronted with the red traffic light until it reached the neutral ground because the traffic lights are set at right angles. We are fortified in our conclusions by the testimony of the traffic officer who was directing traffic at that point in accordance with the instructions of the officials of the traffic department of the city. He states that, when the green light showed towards Rampart street, pedestrians and automobiles, had a right to cross Canal street, and that automobiles and street cars turning from Rampart street into Canal street and going in the direction of the river or to their right were required 'to negotiate the turn when ■the green semaphore light thus showed in theii; favor.

The interpretation contended for by plaintiff would lead to serious traffic congestion, fraught with danger to both drivers of vehicles and pedestrians, whereas the interpretation which we have placed upon the provisions of the traffic ordinance leads to a practicable result, and eliminates, as far as possible under the circumstances, traffic dangers and hazards. We find plaintiff’s position untenable.

Turning our attention to the other charges of negligence, we observe that plaintiff testified that as he started to cross the street he noticed the traffic signal was in his favor; and, as. he neared the neutral ground, he looked towards his right and left to see if any traffic was approaching; that when he was about ip the middle of the tracks he noticed the street car approaching from his left rear side and about one foot from him; that the gong was not sounded; that the front of the car struck him on his left elbow, jamming it into his side and breaking his eighth rib, then throwing him violently to the ground on his right side, causing a compound fracture of his right arm, and that the .force of the impact threw him from between the tracks on the neutral ground; that the street car did not stop until it had entirely passed him; that neither the motorman nor the conductor got off the car to make any inquiries as to his injuries; and that he was taken to his hotel and thence to the hospital, where he was treated.

Plaintiff ihen placed on the stand the traffic officer who was directing traffic from the neutral ground in the center of the intersection. He testified that the traffic light was green in favor of the street car and that it had a right to cross the intersection at the time that it did; that the gong was sounded; that the car came along at a speed of about six or eight miles per hour; that his attention was attracted by the car suddenly coming to a stop; that he did not see the car strike plaintiff, but immediately rushed over to where the plaintiff was, which was three or four feet from the neutral ground in the uptown roadway of Canal street, and assisted him to his feet; that the motorman and conductor also came to the assistance of the plaintiff; that the car stopped with its rear portion in the part of the street provided for pedestrians, and in the curve; that, in accordance with the usual practice of directing traffic at that point, the street car had the right of way.

The motorman arid conductor testified substantially that, when the street car reached Canal, street, the red traific light was showing; that passengers boarded and alighted from the car; that when the green light cairie on the car slowly started ¿cross the intersection arid' around the curve, the motorman sounding his gong as a warning to pedestrians and drivers of vehicles; that plaintiff was not walking in the path provided for pedestrians to cross the street, but was walking diagonally across the street in the direction of the path and towards the neutral ground; that two young men who were just ahead of plaintiff and who were going across to the lower side of Canal street stopped in order to permit the car to pass; that they assumed plaintiff would do likewise; that at that time plaintiff was eight or ten feet from the street car, and that .thereafter they heard a thud somewhere around the center of the right side of the car, and a woman passenger in the car screamed; that the motorman immediately applied his air brakes, and that the conductor almost simultaneously gave the emergency stop bell; that the car stopped within a distance of eight feet; that they got off the street car and ran to plaintiff; that they attempted to secure the names of witnesses, but that the bystanders refused to give their names as well as the woman passenger who screamed. The' motorman testified positively that plaintiff was- not on the tracks and was not struck by the front portion of the car, but that plaintiff apparently did not see the car or misjudged the hang-over and was struck by the side of the car as it rounded the curve.

Defendant also produced the switch tender who was stationed on the neutral ground in the intersection. He, like the policeman, did not see the actual impact due to the fact that he was on the other' side of the street car. His testimony corroborated that of the motorman, conductor, and policeman as to the slow speed of the car, the sounding of the gong, and the stopping of the street car almost instantly with its rear end still in the curve. He further stated that plaintiff was knocked down in the roadway three or four feet from the neutral ground.

We have reached the conclusion that the preponderance of the evidence shows that the street, car went over when the green traffic signal was in its favor; that it was going at a moderate rate of speed; that the gong -was being sounded as it rounded the curve; that plaintiff was knocked down by the right side of the car and not by the front portion of it; and that the motorman was keeping a proper lookout and operating his car with due caution and care, and was therefore free from fault. This was the conclusion of the learned trial judge, and the record clearly justifies his finding.

But, assuming that the motorman was guilty of negligence, plaintiff’s right to recover would be barred by his own contributory negligence because he admitted that he made no attempt to look for traffic coming from his left until he was near the neutral ground. He further insisted that he had the right of way over the street car and that it should have stopped in order to have let him pass. Since plaintiff, a pedestrian, and the street car were both proceeding across, the intersection on a green light, in accordance with the provisions of the traffic ordinance, the street car had equal rights with plaintiff to negotiate the intersection, and both the motorman and the pedestrian were obliged to exercise ordinary care, prudence, and caution in crossing the intersection, so as to not be injured or cause damage or to injure any one else. We feel that plaintiff failed to keep a proper lookout and depended entirely and solely upon the green light in, his. favor, disregarding vehicular traffic which had equal rights in the intersection at the time when he crossed, and that his negligence contributed to the accident.

For the reasons assigned, the judgment appealed from is affirmed.


text:
    No. 13,950
    Orleans
    WOLFE v. TOYE BROS. AUTO & TAXICAB CO., INC., ET AL.
    (December 14, 1931. Opinion and Decree.)
    George Piazza, of New Orleans, attorney for plaintiff, appellant.
    John P. Sullivan and David Sessler, of New Orleans, attorneys for Toye Bros. Auto & Taxicab Co., Inc., defendant, appellee.
    John May, of New Orleans, attorney for Mrs. Hardie, defendant, appellant.
   JANVIER, J.

Plaintiff Wolfe was a passenger in a taxicab of defendant Toye Bros. Auto & Taxicab Co., Inc., when, on the morning of October 20, 1929, that taxicab and a Buick coupe, owned by defendant Mrs. Hardie and driven by her major son, collided at the corner of Melpomene and Prytania streets in New Orleans.

The taxicab was on its way out Melpomene street towards the river, and the Buick was proceeding down Prytania street on the right side of the center of the roadway.

Plaintiff Wolfe charges that both drivers were negligent. He maintains that the chauffeur of the taxicab was at fault in 'that he attempted to cross Prytania street at high speed, without warning, without .'stopping and without according to the Buick the right of way tq which it was entitled under the' traffic ordinance of the 'city of New Orleans, by reason of the fact 'that it (the Buick) was approaching an intersection on a' street on which were located street car tracks and on account of the further fact that it was approaching from the right-hand side of the driver of the taxicab.

Plaintiff asserts that Mr. Hardie, the driver of the Buick, was negligent in that he operated his car at a speed in excess of that permitted by the traffic ordinance to.which we have referred and, in effect, plaintiff further charges that in spite 6f the negligence of the driver of the taxicab Mr. Hardie could have avoided the accident had he .been paying attention and had he been driving at a reasonable, lawful speed.

The ordinance in question is No/ 7490, C. C. S., and the particular portions thereof which are pertinent are the following:

.. Article 1, section 7. “RIGHT OP WAY. (a) Vehicles traveling on the following streets have the right of way over vehicles approaching on intersecting streets, namely; (certain streets specially designated by name).

, “All boulevards, all streets with street car tracks * * * (other paragraph not 1 pertinent to the issues here involved.)

“Vehicles approaching from the right shall have the right of way * *

' Article 2, section 1, paragraph (b). “TWENTY MILE ZONE. All streets and avenues within the City of New Orleans not otherwise restricted * *

Wolfe itemizes his damages and financial losses as follows:

Pee paid to trained nurses from October 20, 1929, to November 10, 1929.,$ 174

Medicines ____________________________________________________ 25

Doctor bills ................................................ 176

Injury to nervous system________________________ 2000

Injury to left eye................ 2000

Physical pain and mental anguish...... 2000

Total ______________________________________________________$6375

The district judge rendered judgment for plaintiff and against Mrs. Hardie for $150, but rejected the demand against the other defendant, Toye Bros. Auto & Taxicab Co., Inc., and from that judgment .both Mrs. Hardie and Wolfe have appealed.

Mrs. Hardie, prior to answering on the merits, had filed an exception of no cause of action based on the alleged absence of charges of negligence against her and, in •support of the said exception, her counsel argues that plaintiff’s petition throws the entire blame for the accident on the driver of the taxicab and thus fails to show any negligence on the part of the driver of Mrs. Hardie’s Buick and that the petition fails to allege and the evidence fails to show any facts which would render Mrs. Hardie legally responsible for the negligent acts of her major son.

The petition does allege that the Buick, owned by Mrs. Hardie and in which she was a passenger and which was driven by her son, “was proceeding at a rate of speed in excess of 25 miles per hour, in violation of the aforementioned traffic ordinance; that the driver of said automobile failed to keep it under absolute control upon approaching and reaching an intersection so that it could be stopped at once in case of emergency.” Here we find an allegation that the traffic , ordinance had been violated and we find an allegation that, immediately after the violation or, in fact, during the continuance of the violation, the collision .occurred. We feel, as did His Honor below, that such an allegation was sufficient to put that' defendant on her guard. We believe as did the district judge that, although the allegations as to the negligence qf the driver of the Buick may be somewhat vague, nevertheless, they are sufficient to permit of the introduction of evidence in support thereof.

There is no doubt that a parent merely by reason of the relationship is not responsible for negligent acts of his or her major children, but here we .find from the evidence that the automobile in question belonged to Mrs. Hardie, that she was riding therein, and that, according to her statement, it is probable that ' she had asked her son to drive her to the railroad station to meet her parents. It is quite true that on' various prior occasions the son, on his own initiative, had driven to the station to meet defendant’s parents, his grandparents, and it is equally true that had an accident occurred on those occasions in all probability there would have been no liability in Mrs. Hardie, but here it appears that the son, though a major, acting on the request of his mother, was driving her in her car and we feel that, thus, on this particular occasion, he was acting as the agent of his mother and that she should be responsible for the results of his negligent deeds while so acting.

We find from the testimony of Mr. Hardie, himself, that he was driving at about 25 miles an hour. This, in itself, was a violation of the traffic ordinance which in that locality limited speed to 20 miles an hour, and constituted negligence per se, but, of course, would not render liability absolute unless it appears from the record that that negligence had causal connection with the ultimate result. However, . according to the testimony of Mrs. Hardie he. must not have been keeping a careful look-, out ahead because he did not see the taxi-, cab coming out of the side street, and, in. fact, was not aware of its presence until,’' as he puts it, “I was practically on top of, it.” Had his speed been within the limit permitted by the ordinance and had he, been keeping a proper lookout it could,hardly be said that he could have failed in: an effort to avoid the collision.

As to the taxicab, the evidence fails to show any negligence chargeable to the driver. The only statement in the entire record to the effect that the taxicab did” not stop or slow down before entering the’ intersection is given by Wolfe, the plaintiff, but his testimony in this regard is made of little value by a written statement signed by him on the morning after the accident in which he said “when the cab arrived at a carline intersection (perhaps Coliseum) the cab slowed down, blew his, horn and then proceeded across.” There is, then, in the record no trustworthy evidence that the taxicab driver was careless; in negotiating the crossing and the proof’ is abundant to the effect that the cab had entered the intersection first and that it was almost across when it was struck by the Buick. " ■

Since the driver of the taxicab was not' at fault and since the driver of the Buick was at fault and since Mrs. Hardie is legally liable under the circumstances for the negligence of the driver of her automobile, it follows that the judgment appealed from insofar as it fixes liability solely upon Mrs. Hardie is correct.

It, therefore, behooves us to consider the evidence with reference to the extent of the injury and losses sustained by plaintiff.

Our attention is at once attracted by tbe discrepancy between tbe amount claimed by plaintiff, $6,375, and tbe sum fixed by the trial judge, $150, as being adequate to recompense plaintiff for his losses, but we find from the reasons given by our brother below that he' did not believe the witnesses for plaintiff who, testified as to the extent of the injury sustained. He uses the following language: “The people in the boarding house are friends of the plaintiff. It is my opinion that in testifying about the result of the accident they and the plaintiff did not tell the truth.” The record is voluminous, being one of the largest records we have encountered in our experience, but a very careful study of it leaves in our minds the conviction that His Honor below was not in error in coming tq the conclusien recited above.

Plaintiff, at the time of the accident, was on his way to a train depot to make, what appears to us, a rather unimportant trip to the country, intending to return that night. If his injuries had been as serious as he contends it is certain that he' would not have continued on that trip, but we find that he not only went on the trip, hut that, before going on the trip, he did not obtain even a first-aid treatment from a doctor, though he says that he did call at a hospital but could not wait until a doctor arrived; that he ate his meals apparently as usual during the day, and that included in that trip were several automobile rides covering many miles.

After his, return home he claims to have been under the care of day and night nurses for several weeks and there is no doubt that he did call in a reputable physician, who treated him for two or three weeks, but that physician states that, outside of a little nervousness, he was never able to discover anything wrong with the plaintiff except a slight brushburn under one of his arms. An x-ray examination showed no bones broken and no internal injury.

It is true that prior to the accident plaintiff, who had been suffering from an eye disease known as trachoma, had become considerably better and - that some time after the accident this disease became more active and required considerable treatment from an oculist and it is true that the oculist testified, as did the physician, that nervous excitement might start into activity such a disease. However, the oculist stated that it was more probable that the recurrence thereof resulted from the presence of dust or smoke or something of that kind. The oculist also testified that trachoma often recurs without apparent cause and as a result of his testimony we would not be justified in holding that the accident had any connection whatever with the subsequent recurrence of the disease.

The other statements in the record and other allegations in the petition are so patently exaggerated as to warrant the belief that plaintiff took advantage of a minor accident to attempt to mulct defendant for excessive damages. At any rate, the trial judge saw and heard all the witnesses and in cases where there is an apparent attempt tq mislead and exaggerate we find, especially applicable, the rule that' the findings of the trial judge should not he interfered with.

It is, therefore, ordered, adjudged, and decreed that the judgment appealed from be and it is affirmed, defendant Mrs. Hardie to pay all costs in the court below and her own costs on appeal and plaintiff to pay all other costs.


author: WESTERFIELD, J.

text:
    No. 13,914
    Orleans
    MARINE ELECTRICAL WORKS, INC., v. WESTFELDT
    (December 14, 1931. Opinion and Decree.)
    Joseph O. Schwartz, of New Orleans, attorney for plaintiff, appellant.
    Frank William Hart, of New Orleans, attorney for defendant, appellee.
   WESTERFIELD, J.

Plaintiff, an electrical contractor, alleges that on the 24th day of April, 1930, Gustaf Westfeldt contracted with it to furnish the necessary labor and material to rewire his home, No. 230 Prytania street; that the consideration agreed upon was “a cash sum of money, which said sum was to be figured on a basis of cost of material and labor, plus its usual and customary charge for overhead and profit”; that in the wiring of defendant’s premises, the material cost $139.88 and the labor $213.60; “that your petitioner is entitled to and has earned, and, according to the customary price, should be paid 25 per cent of the said costs for overhead and 15 per cent for a profit, plus the inspection fees, which it has paid incident to its work performed, which inspection fees amount to the sum of $8, all of which amounts to the sum of $516.13.”

Defendant answered admitting that he contracted with plaintiff through Milton L. Levy, its duly authorized agent, to do whatever work was necessary to put the wiring in his residence in proper order “with the distinct stipulation and agreement, however, that the total cost of said work to respondent would not exceed $300.00.” He thereupon deposited in the registry of the court the sum of $329.25, representing the $300 admitted to be due, plus $39.25, the amount of interest and court costs incurred by plaintiff up to that time.

Tbe position of defendant was sustained by the judgment of the court below in allowing plaintiff to recover for the amount deposited, thus rejecting its demand for the sum in dispute. Plaintiff has appealed.

The record shows that Gustaf'Westfeldt, the defendant, met Milton L.- Levy, at that time a representative of the plaintiff, at a dinner party, and, after inquiring whether Levy was still in the electrical contracting business, suggested that he call and see him about the wiring in his residence, which had been giving him considerable trouble. In response to this invitation Levy visited Westfeldt’s home and, after examining the wiring, advised having his house rewired, whereupon Westfeldt asked him what it would cost, and Levy replied “plenty of money,” and, in Westfeldt’s words, he answered, “I said what was it and he said it might cost as much as $300.00 and I said all right, go ahead and do the work.” Whereupon the work was undertaken and finally completed and a bill rendered defendant in the sum of $516.13, the amount sued for herein/ Levy, testifying on defendant’s behalf, gives practically the same account of the transaction, so that the facts surrounding the contract between the parties are not in dispute. The question is the effect to be given the language employed in ascertaining the intention of the parties.

On behalf of plaintiff we are referred to Eggleston v. Hirsch, No. 9549 of the docket of this court (opinion book No. 66, unreported [see Louisiana and Southern Digest)), wherein it was held that “a clause in a building contract reading ‘my maximum estimate of tbe cost of your work is six thousand dollars, including my commission, though I expect to get through with less money, possibly as little as five thousand dollars’ carries no warranty as to the ultimate cost, and cannot be pleaded as such by the owner when he is sued for an unpaid balance due the builder as commissions based on ten per cent of the maximum estimate” (syllabus); and to the case of Weibert v. Hanan, 136 App. Div. 388, 121 N. Y. S. 35, 36, where it was held that the fact that a person employed to improve an existing heating plant stated, when looking it over, that the changes would cost in the neighborhood of $1,500,' and would not exceed that sum, did not obligate him to do the work for that sum or less.

In the Eggleston casé the contract under consideration was admittedly “a cost plus fee contract,” and we held that the conduct of defendant in-making payments beyond the $6,000 referred to in the contract was inconsistent with his alleged understanding that the work was not to cost more than that sum. In the New York case (Weibert v. Hanan) the contract under consideration involved the taking out of two old boilers in the defendant’s cellar and putting in new boilers and new piping, the removal of hot air pipes and registers. “During the progress of the work certain additional defects in the old system were brought to light, particularly in some of the old radiators, which had burst, and in some of the valves, which were defective.” With the consent of the defendant the plaintiff remedied these defects. Before undertaking the work, plaintiff, in looking over the old plant, estimated the cost to be in the neighborhood of $1,500. The defendant claimed that plaintiff said it would not exceed $1,500. The plaintiff claimed $1,729.99, and the court held that he was entitled to that amount, notwithstanding his estimate of $1,500 as the probable cost of the work. Prom our reading of the Weibert case we do not find that the contention that plaintiff had agreed that the cost of th.e work would not exceed $1,500 was upheld, though from the syllabus quoted by plaintiff’s counsel it would appear to have been so held. But, in any event, if the case may be considered as authority for the proposition that a contractor, in estimating the cost of certain work, is not bound by his agreement that it would not cost more than $1,500, we are unable to follow it.

In the case at bar, Westfeldt, desiring to have his electrical wiring put in order, inquired the cost, and was told by plaintiff’s representative that it would cost a lot of money, possibly as much as $300, whereupon he gave an order to have the work performed. We are unable to see in this transaction any stipulation for tbe payment qf the cost of material and labor, with 25 per cent allowance for overhead and 15 per cent for profit, which is the basis of plaintiff’s claim. As a matter of fact there is no reference whatever to the cost of material, labor, overhéad, or profit, but an agreement tq pay an indefinite amount, possibly as much as $300. We cannot view this agreement in any other light than as an undertaking to do the work at a cost not to exceed- $300, with a very strong suggestion that it would not amount to that sum. It is our opinion that defendant was justified in believing that he might give the work to the plaintiff upon that assurance.

For the reasons assigned, the judgment is affirmed.


author: PER CURIAM.

text:
    No. 13,848
    Orleans
    PIERSON v. VICTORY INDUSTRIAL LIFE INS. CO.
    (January 11, 1932. Opinion and Decree.)
    Henry Robinson, of New Orleans, attorney for plaintiff, appellee.
    Chas. I. Denechaud and Ernest J. Robin, of New Orleans, attorneys for defendant, appellant.
   ON MOTION TO DISMISS

PER CURIAM.

Appellee seeks the dismissal of this appeal, and, as reason therefor, alleges that the president of appellant corporation was not authorized by the board of directors to prosecute the appeal, nor to sign the appeal bond on behalf of the corporation.

Appellee suggests, as further ground for the dismissal of the appeal, that a motion to dismiss was filed in the court below.

No objection was made to the action of the president of defendant corporation in defending the suit in the court below.

The right of appeal is favored under our law, and the right to defend-a lawsuit on behalf of the .corporation carries with it, unless the authority is withdrawn, the right to appeal from an adverse judgment.

In enacting section 35, paragraph 7, of Act 250 of 1928, the Legislature of Louisiana apparently intended to authorize the president of a corporation to take all reasonable and necessary steps to represent the interests of the corporation in all legal matters connected with its affairs. It appears to us that the authority of the president in such matters is presumed to exist, and that the absence thereof must be affirmatively shown. Here, however, the corporation has not filed a motion to dismiss, nor has- it joined appellee in her motion, and all that we are told is that, at a meeting of the board of directors called to consider -the advisability of taking the appeal, the vote was five to five, a circumstance which, if true, we cannot consider.

Since the president was. presumed to have the authority to take the appeal, that authority will be presumed to continue to exist, unless affirmatively shown to have been withdrawn.

That this motion was filed in the court below cannot be taken into consideration by us, since, prior to the day on which it was filed there, the appeal had been lodged here, and therefore the court below had lost jurisdiction.

The motion to dismiss, the appeal is denied.

HIGGINS, J. This is a suit to recover the sum of $300 cash, said to have been loaned by plaintiff to defendant, an industrial life insurance company, $100 on September 24, 1928, and $200 on July 11, 1929, with interest at the rate of 8 per cent per annum from the respective dates of the loans until paid. The petition alleges that no definite dates for the repayment of -the loans were stipulated, but that it was contemplated by both parties that said loans were to be paid within a reasonably short period from their respective dates.

Defendant admitted that it is engaged in the industrial life insurance business; incorporated and doing business, under the laws of the state of Louisiana; that the two loans were made by plaintiff to it bearing 8 per cent interest and that no definite maturity dates were set, but that it was understood between plaintiff and defendant at the time the said loans were effected that defendant would have the option of paying the respective loans whenever it would be financially able to do so, in accordance with the provisions, or Act No. 246 of 1908; ‘‘and that it is not in a position, at this time, to repay the said loans.”

There was judgment in favor of plaintiff as prayed for and defendant has appealed.

The record shows-that defendant is an. industrial life insurance company, organized in November, 1927, under the laws of Louisiana and conducting a business as such. Plaintiff is one of tbe organizers and is a member of tbe board of directors of the company. In August, 1929, tbe state auditor examined tbe company’s books and discovered that tbe initial casb fund of $5,000 required by section 3 of Act No. 246 of 1908 to be in tbe treasury before beginning business bad been impaired due to the fact that certain expenses bad been incurred in tbe organization of tbe company and bad been paid out of tbis fund. Tbe secretary of state ordered tbe officials of tbe company to replace tbis money. In order to do tbis, tbe officers called a meeting of tbe members of the board of! directors on August 9, 1929, at wbicb meet-' ing tbe directors were solicited to make tbe necessary loans to cover tbe deficit. ’ Tbe first time plaintiff was requested to 1 assist in relieving tbe financial distress of ; tbe company sbe loaned $100 on September 24, 1928, and tbe second time sbe was so-; licited, July 11, 1929, she advanced tbe sum of $200. It appears that sbe was not furnished with any note or acknowledg-: ment of tbe indebtedness until her attorney, some time prior to tbe filing of this suit on March 10, 1931, made demand upon" tbe company, when notes were furnished.

On the issue of when tbe $100 loan was to be paid, plaintiff admitted in her testimony that she was familiar with tbe financial difficulty in wbicb tbe company was involved and that it was explained to her that sbe was loaning tbe $100 because tbe company’s initial casb fund was impaired on account of deducting organization expenses, and that the money advanced by her would be returned “as soon as there was sufficient money in the treasury.” On the question of when the $200 loan was to mature plaintiff testified that it was agreed that this money would be returned in two weeks after it was advanced.

When counsel for defendant sought to show both on cross examination and by direct evidence that tbe ten members who put up tbe original $5,000 did not make any provision for tbe payment of tbe organization expenses and, through ignorance and error of law, deducted these expenses from tbe initial casb fund of $5,000, wbicb tbe secretary of state ordered to be restored, and that tbe company was not in a financial position to pay these loans, tbe trial court, upon timely objection, ruled that tbe evidence was immaterial and inadmissible on tbe ground that section 3 of Act No. 246 of 1908 only covered money that was loaned or advanced for organization purposes at tbe time an industrial life insurance company was being organized. Counsel for defendant timely and properly reserved a bill of exception to the court’s ruling.

But, there is sufficient evidence in the record to show that tbe $100 was advanced by the plaintiff for the purpose of making up the deficit in the initial casb fund of $5,000 from wbicb tbe organization expenses had been erroneously deducted and that tbe company, at tbe time tbe suit was filed and at the time of the trial, was financially unable to pay plaintiff.

Tbe trial court permitted cross examination of plaintiff and also admitted the testimony of defendant’s witnesses on the issue of whether or not tbe $200 was loaned for tbe purpose of covering organization expenses. So as we view tbe-record, while tbe trial court on several occasions erroneously ruled out evidence tending to estab-^ lisb tbe defendant’s position, nevertheless tbis evidence was finally admitted into tbe record. Therefore, we do not believe it necessary to remand tbe case.

Section 3 of Act No. 246 of 1908 provides:

“Be it further enacted, etc., That all companies organized on the mutual plan shall have an initial fund of five thousand dollars in cash in the treasury before beginning business. A mutual company may borrow or assume liability for the payment of a sum of money sufficient to defray the reasonable expenses of its organization and to provide the amount of the initial fund as aforesaid upon an agreement, that the same with interest at a rate not exceeding eight per cent per annum shall be repaid only in the event that after such repayment with interest the corporation shall be left possessed of sufficient assets to meet all its liabilities and to maintain intact its initial fund, and such agreement, shall provide that the corporation. shall have the option to make such repayment whenever it shall be able to do so in accordance with the aforesaid conditions.”

In view of the plaintiff’s admission that the $100 was advanced for the purpose of replenishing the $5,000 initial cash fund so as to make up for the organization expenses which had been erroneously deducted from it and that the loan was to be paid as soon as. there was sufficient money in the treasury to justify it, we experience little difficulty in finding that the $100 was •advanced under the provisions of section 3 of Act No. 246 of 1908.

It is clear that the company, at the time the loan was made, at the time the suit was filed and at the time of the trial of the case, was not in financial condition to repay the loan; Consequently we are unable to give plaintiff- judgment, at this time, for this money because under section 3 of the act “the corporation shall have the option to make such repayment whenever it shall be able to do so in accordance with the aforesaid conditions,” but we reserve to plaintiff her right to proceed against defendant at any time that its financial condition will permit her to recover as provided in section 3 of the act.

While the evidence is conflicting pn the question of the maturity of the loan of $200, plaintiff stating that the money was to be repaid in two weeks and two officials of the defendant company claiming that the money, was loaned for the purpose of again making up a deficit in the initial fund, it appears to us that the law and evidence is with plaintiff on this issue.

The loan of $200 was made on July 11, 1929, and, therefore, nearly one year subsequent to the time that the $100 was loaned on September 24, 1928, for the purpose of making up the deficit due to the fact that organization expenses had been deducted from the initial cash fund. When the second deficit occurred and the $200 was advanced “a sum of money sufficient to defray the reasonable expenses of the organization” had been raised and the cash initial fund restored under the secretary of state’s directions and orders in August, 1928, therefore, the loan of $200 could not have been for the purpose of meeting this same item of expense. We conclude, therefore, that plaintiff’s evidence that the $200 was. to be repaid in two weeks is correct •and that section 3 of the act is not applicable, because the $200 was not loaned for the purpose of defraying the initial organization expense.

For the reasons assigned the judgment of the lower court is amended by reducing the amount awarded plaintiff from the sum of $300 to the sum of ''$200, dismissing plaintiff’s suit as of non-suit in so far as the $100 loan is concerned, and reserving to plaintiff her right to sue the company in accordance with' the provisions of section 3 of the Act (246) of 1908 and in all other respects the judgment is affirmed at. appellant’s cost.