Wm. H. Chaffe & Co. v. Purdy

43 La. Ann. 389 | La. | 1891

Lead Opinion

The opinion of the court was delivered by

Breaux, J.

Plaintiffs, owners of all the assets of John Chaffe & Sons, former owners, instituted this suit against the defendant to recover of him a balance, alleged to be due on three notes, the face value of which aggregate an amount of §2700 in principal, dated 6th September, 1882, and bearing 8 per cent, interest from March 1, 1882. These notes show certain credits endorsed, the correctness of which is denied.

The defendant in his answer denies the 'allegations of the petition and only admits the execution of the notes sued on.

He contends that he is released from his obligation as maker of the notes for the reason that he transferred to John Ghaffe_&Sons three certain promissory notes as collateral security, signed by M. DuBose as drawer, and secured as to their payment by mortgage on property in the town of Lake Providence. These notes thus transferred amounted to §2000, and bore 8 per cent, interest per annum from December 10, 1878.

The attorney of defendant had these notes in collection.

They remained in his possession with the consent of the defendant.

The pledgees brought suit via executiva on these notes on November 3, 1882.

The proceeding of foreclosure was enjoined by Dubose.

From that judgment appeal was taken to this court. Vide, Chaffe & Sons vs. V. Dubose, 36 An. 257.

Afterward a second injunction suit was brought by the same plaintiff in injunction.

These two injunctions having been dispósed of, the property mortgaged to secure the payment of the pledged notes was ultimately sold on June 6, 1885, for §1500.

The sheriff’s return made at the time show that he deducted costs, taxes and fees, leaving an 'amount of $1049.26 to the credit of the seizing creditor. *

*393No objection was made to the deduction.

A short time after the sale, in 1885, the pledgees furnished a statement to the defendants in which was included the items charged by the sheriff in his return as well as others, amounting altogether to §562.47, and leaving a balance to defendant’s credit which was afterward endorsed on his-notes, due to the plaintiffs, of §987.53.

The statement was enclosed by mail to the defendant who was requested, to examine it and let them know if correct.

The request was complied with, and the statement was accepted as satisfactory.

The defendant now claims that plaintiffs made themselves the owners of the DuBose notes, pledged by him to them, and responsible for the whole amount; and besides he claims.and charges that it was the duty of Chaffe & Sons to require the sheriff to collect rents upon the property during the seizure, and having failed so to do, he alleges that they became responsible to him for the amount, viz: §30 per month for thirty months, and he prays that he be credited with this amount.

He also alleges that plaintiffs owe the balance due on the Dubose notes, because they failed to sue him for this balance; that they should be held for not having brought suit for costs and damages on the injunction bonds furnished b;y Dubose, the debtor of the pledged notes.

The amount of this last claim is limited to §1500.

The ease was tried by jury and a verdict was found for plaintiffs for the amount claimed.

On motion for new trial the verdict was set aside for defect of form.

On new trial judgment was pronounced for plaintiffs from which the defendant appeals.

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It is in place to decide the questions presented in several bills of ■exceptions.

Upon the last trial counsel for plaintiffs offered the testimony of two witnesses taken upon the former trial.

One of the witnesses was sick and unable to be present, the other absent.

Counsel for defendant objected upon the grounds that it was not shown that this evidence could not again be taken either in person *394or by commission; that be would be limited to this testimony, and denied the right of interrogating these witnesses.

The issues in the first and second suits were identically the same, not the least amendment had been made; the evidence was taken contradictorily with the defendant, who only claimed the right to' interrogate the witness upon other matters tha-n those testified to in the first suit.

.The defendant had ample opportunity for the cross-examination of the witnesses in the first suit.

We do not discover the least surprise or advantage. Conway vs. Erwin, 1 An. 391. Even if this evidence were excluded, the damages claimed would not be proven.

Without it, the record discloses the insolvency of the debtor of the collateral security; 'and it is not proven that the loss of the bonds, if any, was one for which the plaintiff could be held.

The counsel for the defendant, it is shown by a second bill, offered to prove by his own testimony that he had received a proposition from M. Dubose 'to transfer him property by which the whole amohnt of the Dubose notes placed in the hands of Chaffe & Sons by him could be realized, also to prove the answer made by the latter.

The defendant did not obj^pt when the sheriff credited the proceeds under the foreclosure proceeding before mentioned; he also expressly approved the distribution of the funds as' made; he did not allege in term that Chaffe & Sons declined to accept a proposition of compromise, made through him, whereby the whole claim would have been settled.

The evidence was not admitted and was properly excluded.






Opinion on the Merits

On The Merits.

There was nothing extraordinary in the business transaction which gave occasion for this litigation.

The defendant offered his notes to plaintiffs his creditors, in order to obtain time, and offered certain notes, secured by mortgage, as collateral security.

They were accepted.

In accordance with agreement between pledgor and pledgees, the pledged notes remained in the hands of the attorney, who had them for .collection at the time the pledge was made and suit brought on *395the pledged notes. Not the least disagreement arose between pledgors and pledgees 'during the foreclosure and injunction proceeding. The defendant was at the place; plaintiffs resided at some distance.

The defendant in his answer sets forth that “ said Ohaffe & Sons took full and complete control and possession of said notes, and exercised all the rights of ownership over them — even denying unto your respondent any right to stipulate or dictate what sKould be done with them.”

These allegations are not supported by apreponderance of evidence.

The testimony of one of the plaintiffs and of the attorney is uncontradicted in many respects. It does not corroborate that of the defendant about the ownership of the notes and the management of the suit. It is not shown that plaintiffs attempted to exercise rights of absolute ownership.

Defendant earnestly contends that plaintiffs are responsible for the whole of the amount of the pledged notes, for the reason that after the property mortgaged had been sold-to satisfy the collateral security, suit was not brought for the balance due.

The debtor owned only this mortgaged property. He was insolvent at the time. The pledgees can not be held responsible for not having brought suit against an insolvent debtor.

“The pledgee is responsible only for the damages sustained by the pledgor, and for the net sum he was legally able to collect.” Blouin v. Harter & Herbert, 30 An. 714; Grove vs. Robert, 6 An. 210.

* * * * * ijs * sfs

The defendant complains that the rent was not collected while the sheriff had the property in hjs possession under the foreclosure proceeding. He hastily assumes that it was the duty of the sheriff to collect rent, and charges up damages to plaintiff’s account.

The dwelling seized was occupied by the debtor; i. e., the debtor of the collateral security, and his family.

“The sheriff * * * can be held responsible only where the property is occupied by tenants who are bound to pay rent, or where the property being vacant or susceptible of being rented, he fails to take proper steps to rent it for a limited time.” Conte vs. Handy, sheriff, 34 An. 863. As there was no authority in the sheriff to collect rent from the proprietor for the occupancy of his own dwelling *396house, before divesture of Ms title:, Ms authority being limited to needful acts to secure possession, the defendant, can not recover any d'amages-from the pledgees upon the sheriff’s failure to collect rent from the proprietor, who is permitted to occupy his dwelling while under seizure.

The attorney (named by pledgor), employed to sue on these pledged notes, testifies: “I never took any proceeding to force the collection of rent while the property was under seizure, because it was the residence of defendant Dubose, in which he resided, and owned by him — was neither vacant nor occupied by tenants, and under the law, in my opinion, the sheriff could not force him to pay rent while he occupied it as a residence.

“ I brought two suits on the injunction bonds. I never interfered with Mr. Purdy’s bringing proceedings for damages. .1 consulted with Mr. Purdy during, all this litigation frequently. Mr. Purdy never instructed me to bring suit for damages on the injunction bonds.”

Lastly, defendant alleges that plaintiffs are responsible in not having brought suit for damages on the injunction'bonds taken in two suits to arrest the foreclosure proceeding.

The pledgor could have controlled these bonds and could have brought suit on them to prevent loss.

The pledgee has merely special property in the note' pledged to secure the principal obligation. He is not obliged to take measures to collect it.

Either the pledgor or the pledgees may'sue for an injury done to the pledge, a fortiori, he may sue to recover a right incidentally arising during' the time the property is in pledge. Story on Bailments, Section 94.

The defendant has not shown any actual loss on these bonds. True, it is alleged that the sureties once solvent, are no longer, solvent. This is not proven.

In some respects this case has features analogous to that of Commercial Bank vs. Martin, 1 An. 345.

As in that case, the plaintiffs were obliged to act through an attorney.

He- counseled with the pledgor, and in all things connected with -the foreclosure his counsel prevailed.

The plaintiffs used reasonable diligence in the choice.

*397The pledgor was consulted and indeed suggested his employment. The evidence discloses he was left at liberty to act and to recover everything possible on these bonds.

Plaintiffs are not responsible in damages.

We think the judgment should be affirmed.

Judgment affirmed.