First National Bank v. Fort Wayne Artificial Ice Co.

The opinion of the court was delivered by Monroe, J. The opinion of the court on rehearing by Blanchard, J. Monroe, J. Dpon January 26, 1899, plaintiff instituted suit against defendant, a corporation organized under the laws of Indiana, and — 134 — having its domicil in that State, to recover a balance of $15,000.00, due upon certain promissory notes, of which plaintiff is holder and owner, and which had been made by defendant, to the order of R. T. McDonald, and were by him indorsed. An attachment issued, and, upon the same day, was levied upon certain real estate in New Orleans, the seizure of which was duly recorded in the mortgage office. Thereafter, February 2nd, a curator ad hoc was appointed to represent the absent defendant, and, upon February 15th, the curator filed a general denial. Upon April 12th, following, the Ilygeia lee Company, Limited, filed an intervention and third opposition, alleging that it had purchased the property in question, by notarial act, January 21st, 1899, and was the owner of it at the date of its seizure, and praying for' judgment ordering the release of said property, and decreeing said company to have been the owner when the attachment was levied. To this intervention the plaintiff filed a general denial, and there were no other pleadings. No serious resistance was offered as against the debt claimed, and no attack, by pleading of any kind, was made upon the attachment. There was judgment for plaintiff for the amount claimed, maintaining the attachment, and the defendant, as also, the opponent, have appealed. Opinion. Objection is made, by way of argument, to the sufficiency of the affidavit for the attachment and of the sheriff’s notice which was served on the curator ad hoc. But, whilst the same counsel represents both the defendant and the opponent, the only brief filed by him is signed in his capacity as attorney for the opponent; who has no standing to raise such questions. As far back as 1820, this court said: “A “ third party has stepped in, averring the goods to be his property and “ demanding restoration of them. The claimant has not only attempted “ to prove the property to be his, but he has been acting the part of the “ defendant by undertaking to show that the attachment ought not to “ have issued, and that after it had issued, it was imperfectly executed. ’“ The only thing which we conceive a claimant may be permitted to do “ is to show that the property attached is verily his. As soon as he “ succeeds in that, his part is at an end. But a claimant has surely no “ right to show any irregularity in the suit in which he intervenes for “ the sole purpose of rescuing the property. Whether the plaintiff, the “ court, and the sheriff have been acting legally or not, is none of his “business.” 8 M. 55. — 135 — Shields, 21st Ann. 118; Commission Co. vs. Bond & Williams, 44th Ann. 841; Lincoln vs. Express Co., 45th Ann. 729. It is true that, in the oral argument before this court, it was stated that the defendant also desired to urge the objection. In the lower court, however, as we have stated, no serious resistance was offered against the debt claimed, and no attack, by pleadings of any kind was made upon the attachment. The general denial applies to the allegations of the petition and contain no reference to the affidavit for the 'attachment, or to the manner in which the writ was executed. Any objections which were made to the attachment must have been made orally, and we have no means of knowing what they were, or when they were made, or whether made by defendant or opponent. Thus, the record merely shows that the judge a quo declined to consider objections of some kind, for the reasons, as stated by him, that, “where a, “party seeks to prevent a seizure on the ground that he is the owner “ of the property seized, no other issue can be tried but that of owner- “ ship. Besides, the defendant having joined issue, any informality in “ the issuance of the attachment is cured.” It is for the appellant to show that there was error in the ruling, and no such showing has been made. “Every act of a court of competent jurisdiction shall be presumed to have been rightly done until the contrary appears.” Rice on Ev., Vol. 1, p. 63. “The appellant must present a record showing error so clearly as to “ overthrow every presumption of regularity. lie must exclude every “ presumption, in favor of the judgment arising from omissions in the “ record, by including all the trial court proceedings affecting the error “ alleged. No presumption or inference in favor of the appellant will “ be made.” Ency. Pl. & Pr., Vol. 2, 294. “It is argued that the plaintiff had no right to the writ of provis- “ ional seizure. * * * No application was made in the court below “to quash the proceedings under the writ; and although the objection “ to the issuance of the writ was contained in the defendant’s answer, “ no action of the court was had upon it, and we are not at liberty to “ consider the subject on appeal.” Ledoux vs. Smith, 4th Ann. 482. “It is too late, after an appearance and answer by defendants, and a trial on the merits, to move to set aside an attachment.” Watson vs. McAllister, 7 M. 368; Enders vs. The Henry Clay, 8 R. 30. — 136 — See, also, Ealer vs. McAllister, 14th Ann. 821; Airey & Co. vs. Okolona Savings Institution, 33 Ann. 1346. It is said that plaintiff had no right to attach, as belonginng to the defendant, property which had been sold by it, and over which it had, therefore, no control at the time of such attachment. The proposition, otherwise stated, being, that, where a vendor and vendee have reached an agreement, which, as between them, amounts to a sale of real estate, the property at once, and without regard to the registry of the contract, passes beyond the control of the vendor, and, therefore, ceases to be liable for his debts, unless the same should be contracted upon the faith of his apparent continued ownership. We .take it to be well settled, under our law, that, whilst a sale of immovable property may be good, as between the parties, by virtue of their agreement, it is void as to third persons until registered; and that so long as such sale is unregistered, an innocent third person may acquire title by purchase, either from the apparent owner himself, or at a judicial sale made at the instance of the creditor of such apparent owner. C. C. 2255, 2262, 2266, 2275. Meyer & Brothers vs. Simpson, Sheriff, 21st Ann. 591; Doughty vs. Sheriff et als., 25th Ann. 290; Derbes vs. Romero, 32nd Ann. 927 Boyer vs. Sheriff, 40th Ann. 657. Cases in which it has been held that a title in an apparent vendee will not preclude the real owner from asserting hisi rights against a creditor of the vendee who has not changed his position by reason, of such apparent title in his debtor have no application. It is further contended that the registry of plaintiff’s attachment, and of the sale to the opponent, of the property attached, having been made upon the same day, the law will not take notice of fractions of the day, and will, therefore, give no precedence to the attachment over the sale, even though the former may have been registered in the morning and the latter in the afternoon. In discussing the rule thus invoked, our predecessor^ in this court have said: . “It has been repeatedly held that the general rule, that the law admits “ of no fractions of a day is a mere legal fiction that is subject to “numerous exceptions; and that whenever it becomes necessary to “determine who of several persons has a priority of right, time may “be distinguished with accuracy. In the case of Callahan vs. Hallwell, 2 Bags. S. C. p. 9, the court said that Time is, in its nature, — 137 — “ essentially divisible from years down to hours and minutes; a minute, “ therefore, will give priority, as effectually, in point of time, as a year “ or a day.’ ” The court, in its opinion, refers to the case of Combe vs. Pitt, 8 Burr. Rep. 1423, 1431, in which Lord Mansfield said: “But “ though the law does not, in general, allow the fraction of a day, yet “it admits it in cases where it is necessary to distinguish. And I do “not see why the very hour may not be so too, when it is necessary, “ and can be done, for it is not like a mathematical point, which can “not be divided.” See, also, Simon vs. Statts, 1 Wendell Rep. 593; 11 Johnson Rep. 229; opinion of Mr. Justice Story in the Matter of Joseph Richardson et al., Law Reporter, Vol. 6, p. 397. “In no classes of cases have the subdivisions of the day been more “ frequently recognized than in the conflicting rights growing out of “the institution of judicial proceedings, and the execution of writs, “from which preferences result. There are cases in which our lav/ “ expressly forbids the different hours of the day from being recog“nized as affecting the right of parties, as in the instance of the in- “ seription of mortgages, but the prohibition must be confined to the “cases enumerated, and must be considered as an admission that the “ rule would be otherwise in the absence of an express enactment.” Tufts vs. Carradine et al. 8 Ann. 430. See, also, Gomilla vs. Millekin, 41st Ann. 123; Bank vs. Burkhart, 100 U. S. 686; Louisville vs. Bank, 104 U. S. 469. In the case of Tufts vs. Carradine, thus cited, the court was called upon to decide between five attaching creditors, whose attachments were made at different hours, upon the same day. But the conclusion would have been the same if the first attaching creditor had been asserting his priority as against persons claiming rights, in or upon the property, upon other grounds than competing attachments. Thus, in Beck vs. Brady, 7th Ann. 3, there was a contest between an attaching creditor, and creditors who obtained judgments and seized under executions, and the court, referring to the conditions at the time of the attachment and to the fights of the attaching creditor, said: “One “ who has no better rights at the time, that is, no privilege, mortgage, “ or lien, can not, subsequently, acquire either, so as to defeat the “process in his favor.” In Stephenson vs. Lee, 6th Ann. 758, the plaintiff injoined the sale of a slave, under an execution which had been preceded by an attachr ment, upon the ground that the slave had been adjudicated to him in — 138 — the foreclosure of a mortgage. It was found that the mortgage was not registered until after the attachment, and the court said: “The attachment, therefore, takes precedence of the unregistered mortgage.” It also appearing that the slave had been bonded, when seized under the attachment, and thereafter sold under the mortgage, the court said: “Even if the registry of the sale of slave attached, after he was “ bonded, might defeat the attachment, still, in this case, that sale was “ not completed and registered in the conveyance office. Therefore, it “ had no effect against third persons, and the property was still subject “ to seizure and execution.” In Gasquet et al vs. Johnson, 2 La. 518, it was said, through Martin, J.: “When the opposing creditor has an imperfect title (the possession “ still remaining in the vendor) the attaching creditor will hold the “ property; the sale as to third persons being completed by the delivery “ alone, etc. (and at page 18). “The decision of this court that, where “ the debtor may sell, the creditor may attach, must be understood as “ confined to cases in which the debtor had once the possession of the “ goods, and still retains it as to his creditors, although he may have “lost it to his vendee, as in the ease of a sale not followed by a “ delivery.” In Emerson et al. vs. Fox et al., 3 La. 182, it was said by Judge Martin, as the organ of the court: “The contract of sale is perfect as “to the parties, by their agreement, before tradition, * * * but “ this tradition is necessary to vest the property in the vendee. This “ has been so very often decided in' this court that a reference to par- “ ticular eases is unnecessary. But the law considers the tradition or “ delivery of immovables as always accompanying the public act which “ transfers the property. * * * From this general provision, those “ cases must be excepted in which there is an evident legal obstacle to “ the delivery. The law can not consider that as done which can not “ legally be done. In the present case, the house and lot being ‘in the “possession of the sheriff, at the time of the sale, it is clear that the “vendor could not make a tradition or delivery of them without vio- “ lating the possession of the sheriff,’ ” etc. Under the law, as it now stands, regulating seizures by the sheriff, in the Parish of Orleans, that officer is not required to take the property into his physical possession, but to cause a notice of seizure, the form of which is prescribed, to be served on the person whose property is to be seized,' and a like notice to be recorded in the mortgage office. He is — 139 — also required to note and to make return of the date and hour of such recordation, which is “deemed and considered as the seizure and possession by the sheriff ” etc. R. S. 3625, 3626, 3627, 3628, 3629. We have seen that the seizure in this case was recorded at forty minutes past one o’clock, upon January 26, 1899. It is not denied that the effect was the same as if the property had been taken, as it would have been in the country parishes, into the actual, physical, possession of the sheriff. It is admitted, that, as between seizing creditors, the law favors the vigilant, and that the first in point of time, whether it be days, or hours, or minutes, obtains a preference over those who are later. It is said, however, that -a creditor who seizes in the morning, takes absolutely nothing, as against a prior purchaser who records his act of purchase in the afternoon, whilst the property is in the hands of the sheriff. But, if the seizure by one creditor is good as against a subsequent seizure by another creditor, why should it not be good as against a purchaser to whom no delivery has been made, or can be made? By the express terms of the law, the seizure takes effect at the moment that it is made; whilst in regard to sales, the law reads: . “All sales, contracts and judgments, affecting immovable property, “ which shall not be so recorded, shall be utterly null and void, except “ between the parties thereto. The recording may be made at any time,» “ but shall only affect third persons from the time of the recording. “ The recording shall have effect from the time when the act is deposited in the proper office, and indorsed by the proper officer.” C. C. 2266. In Summers & Brannins vs. Clark, 30th Ann. 436, the article cited was applied in a case where leased property, situated in New Orleans, was seized under execution, and the seizing creditor claimed the rents, though the lessee, holding under an unrecorded lease, had bound himself for the same by negotiable promissory notes, which he had delivered to the lessor, and which were outstanding. It was held, that the lease not having been recorded, as required by C. C. 2264, was null and void as to third persons, as provided by Article 2266, and that the lessee was bound to the seizing creditor for the rents. This court said: “If a vendee in such case can, by seizure, be deprived of possession and enjoyment under his purchase, why not a lessee? If, in such a case, it is no defense that the vendee has paid the — 140 — price, why should it be that the lessee has paid the rent? The principies involved in the two cases are the same, and by no means novel.” At page 440, upon application for rehearing, the suggestion was considered that the article referred to, had been incorporated as new law in the Code of 1870, and it was held that this did not affect the conclusions as announced in the original opinion, which were, accordingly affirmed. It will be observed that, by Article 2266, the sale takes effect as against third persons, from the “time,” and not from the “day” or. “date” of the registry, so that, if it could be supposed that the use of the latter words would make a difference in a case such as this, the question must be regarded as settled by the use of the word “time” in the later enactment. The opponent alleges that it had purchased the property in question before the attachment, but it does not allege that there had been any delivery. Upon the contrary, the allegation upon the subject is, that the[ “sheriff has attached and taken into his possession, the following described property,” etc. The opposition is, therefore, in the nature of a petitory action in which the plaintiff must recover upon the strength of the title exhibited by him. In any aspect of the case, the burden of proof rests upon the opponent to show that, not only as to its vendor, but as to the plaintiff in attachment, the property in the possession of the sheriff belonged to it at the moment of the seizure. Harper vs. Bank, 15th Ann. 135; State vs. Bank, 20 Ann. 468; Williams vs. Hefner, 30 Ann. 1193. And, inasmuch as registry is necessary in order to establish title in real estate, as against third persons, the burden rests upon the opponent to show, affirmatively, that, the title under which it claims was duly registered before the plaintiff acquired possession by seizure. It is not pretended that this has been done. It appears from the evidence that the act of sale, upon which the opponent relies, was executed January 21, 1899, but that the parties thereto failed to reach a conclusion as to which of them should pay the internal revenue tax, amounting to $160, so that the matter remained in abeyance until January 26, the day upon which the attachment was levied. Whether the question of the payment of the tax was settled, and the act was then registered before the registry of the seizure, or afterwards, does not appear. It is clear, however, that the time at which the revenue stamps were affixed, and at which the act was sent to the conveyance office, and — 141 — received and indorsed by the register, are matters that are within the cognizance of the opponent, rather than of the attaching creditor, and that the burden of proof upon the subject rests upon the former. Greenleaf on Ev., Sec. 29; Bowman vs. McElroy & Bradford, 15th Ann. 663; Ridgely, Blair & Co. vs. Gill, 15th Ann. 509. Beyond this, there is no other evidence than the declaration contained in the act of sale, that the purchaser has paid any part of the purchase price, or that it will lose anything by the seizure. And, in view of the admission that the question of the revenue stamps remained open until January 26th, it seems hardly probable that any payment was made before that time. Upon the other hand, if the purchase price was paid onj the date last mentioned, and after the seizure, the purchaser did a very imprudent thing, and has only itself to blame; for, it is shown that the certificate of mortgages, attached to the act of sale, bore neither date nor signature when the act was registered; and it has been stated, in argument, without contradiction, that it had been issued more than a month before, and was eventually dated January 21, 1899. What difference, if any, it would have made if the sale to the opponent, though recorded after the seizure by attachment, had been recorded within forty-eight hours after the passage of the act, as provided by C. C. 2255, is a question which does not arise. Eor these reasons, we are of opinion that there is no error in the judgment appealed from, and it is, accordingly, affirmed.