235 F. 937 | E.D. La. | 1914
(after stating the facts as above). There is little or no dispute as to the material facts in this case, though it has been somewhat difficult to extract them from the voluminous transcript owing to the acrimony of the trial before the referee, the many objections repeatedly'dictated into the record by counsel for all parties, and the failure of the stenographer to index the testimony as required by rule 20 of this court.
The procedure adopted in the instant case is usual in the settlement of estates in Louisiana in succession, receivership, and bankruptcy matters, and has all the elements necessary to comply with the law. The pleadings are filed in full, and the creditor whose claim was attacked evidently had ample notice and his day in court.
The agent of the surety company, Mr. Ross, was called in and agreed to write the bond if Collins would transfer the property to some one else, as he did not think he could write a bond for a man who was both owner and builder. Ross testifies that he was not told and did not know that the buildings had been started at that time.
An act of sale was executed before Dreyfous from Collins to Singer purporting to be a sale for $7,500; $900 cash and the balance represented by three notes each for $2,200 secured by mortgage and vendor’s lien.
This act was purely a simulation. No cash was paid, and it was not intended to transfer the title. Ross testifies he did not know it was a simulation. The bond transaction is not material, except that there is testimony to the effect that the only reason for the sale was to secure the bond. Dreyfous took the three notes. He testifies he retained one and sold two to a client, a Mrs. Tujaque, and credited Collins’ account with the proceeds. He liquidated, and in his notarial capacity canceled, the $2,700 vendor’s lien note which he held for his own account and paid out $625 in cash, including the premium on the builder’s bond. The balance of the proceeds he still has in his possession, and it is credited on the proof of claim filed by Miss Danziger.
It is evident that the transaction was entirely for Dreyfous’ personal account, and Miss Danziger, who was his clerk, is absolutely without interest in the notes. Her proof of debt is not in the form required as agent, and in making it her agency is not disclosed.
Technically, it is false and should be expunged and disallowed.
With regard to the real estate known as the Louisiana avenue property against which Miss Danziger claims a vendor’s lien and mortgage of $2,600 by virtue of the simulated sale of February 9, 1912, but which is also the property of Dreyfous, it is not shown that any consideration whatever was paid, and the same principle applies to it as to the nullity of the act.
The judgment of the referee will be reversed, and the claims of Miss
The rights of the trustee to recover of Felix J. Dreyfous the balance of the proceeds of said notes to satisfy the claims of innocent third holders of same is also reserved.
Reversed and remanded for such further proceedings as may be necessary, and in conformity to this opinion.
On Application for New Trial.
An application for a new trial has been filed in this case by Mr. Dreyfous and Mrs. Miller, née Danziger, and all questions extensively re-argued.
It is also contended that, while the transaction between Dreyfous and Collins was not a sale, it was intended to secure Dreyfous and should be considered a mortgage, good as ,to third persons. In support of this, the following cases are cited: Parmer v. Mangham, 31 La. Ann. 348; Wang & Cottam v. Finnerty, 32 La. Ann. 94; Nuss v. Nuss, 112 La. 265, 36 South. 345. These cases are not in point. The first-named case tends to support my previous ruling. A debtor was fraudulently trying to deprive his creditor of the security he had given him, and the court condemned the attempt in strong language. See page 354 of 31 La. Ann. In the second case, there was a sale with a counter letter. The debtor was in possession of the property under the recorded deed. The judgment sought to be enforced against the property was rendered long after the transaction between the parties. The last case was a transaction between husband and wife and other relatives. No rights of prior creditors were involved.
There seems to be some doubt as to the correctness of the judgment denying Miss Danziger a lien on what is called the Louisiana avenue property. This transaction was clearly a simulation, but it is contended the matter has been settled and no one is objecting. Proof of settlement does not appear in the record; but, if the facts are as stated in the argument, the decree may be amended.
On the whole, I see no reason to change my views heretofore expressed. The application for a new trial will be denied. The parties may submit an amended decree in conformity with this and the original opinion.