National Park Bank v. Concordia Land & Timber Co.

OVERTON, J. In the first named of these consolidated cases, judgment was rendered against the Concordia Land & Timber Company, a corporation organized under the laws of Wisconsin, and domiciled in said state, for the sum of $56,517.04, with interest at the rate of 5 per cent, per annum thereon until paid, and sustaining a writ of attachment issued in the case. The same judgment condemned the Black River Lumber Company, as garnishee, to pay plaintiff the above amount. The Concordia Land & Timber Company was cited through a curator ad hoc and by posting copies of the petition, citation, and writ of attachment on the courthouse door. The Black River Lumber Company was served with legal process, as garnishee, by delivery of the same to its duly authorized agent. Service on both the defendant and garnishee was made on March 12, 1921. On May 4th of the same year, the defendant having failed to make any appearance in the case, a default, previously entered, was confirmed, and the above judgment rendered against it, and, on the same day, the garnishee having failed to answer the interrogatories propounded to it to ascertain whether it was indebted to plaintiff, and, if so, in what sum, the interrogatories were taken for confessed, and judgment was rendered against it, as above stated. The garnishee has appealed from the judgment rendered, and has assigned as error in this court that the judgment is absolutely null and void both as against it and the Concordia Land & Timber Company, for the reason that from the allegations of plaintiff’s petition it appears that the Concordia Land & Timber Company had been doing business in the state of Louisiana, and therefore no curator ad hoc could be appointed, and no service could be made on that company in the manner adopted by plaintiff, since section 26 of Act 267 of 1914 and Act 179 of 1918 have repealed all laws permitting the service of process on a foreign corporation through a curator ad hoc. The assignment further sets forth as error that the judge below failed to take judicial notice that the Concordia Land & Timber Company had appointed an agent to receive service of process, and to notice that the appointment had not been revoked. It is alleged that he should have taken such notice, and this court is urged to do so. The assignment concludes by averring that, as the judgment against the Concordia Land & Timber Company is an absolute nullity, on the face of the record, the judgment against the appellant and garnishee, the Black River Lumber Company, is also null, and must fall with it. The judgment against the Concordia Land & Timber Company is one in rem, and is based on promissory notes, signed as maker by the Jeffries Lumber Company, payable to the order of plaintiff, the National Park Bank, of New York. The notes were indorsed by the Concordia Land & Timber Company, and were dated at Jeffries, La. The order of court appointing the curator ad hoe, and granting the writ of attachment, upon which the garnishment is based, was issued on the following allegations, duly sworn to, and found in plaintiff’s petition, to wit: “Said Concordia Land & Timber Company is absent from and not represented in the state of Louisiana, and has already left the state permanently, or is about leaving permanently the — 37 — state without there being a possibility, in the ordinary course of judicial proceedings, of obtaining or executing judgment against it previous to its departure.” While the question, as to the right of the garnishee to urge the nullity of the judgment against the defendant does not appear to be raised, yet it may be said, in reference to such a right that, if the law did not authorize the proceeding in rem, as conducted by plaintiff, then it follows, as a matter of course, that the judgment rendered against the defendant is absolutely null and void. Since the garnishee has been condemned to pay that judgment and since it is manifest that a garnishee should not be called upon to pay a judgment that is absolutely null and void, the right exists in the garnishee to attack the judgment on that ground. As the demand against the garnishee is purely ancillary to that against the defendant, if the judgment based on the latter should fall, the judgment against the garnishee should fall with it. To hold otherwise would be to hold, in effect, that a garnishee may be required to pay an alleged debt against another before it is proved, since a debt cannot be proved, from a legal standpoint, until the debtor has been cited, or has waived citation. In fact, it is held in other jurisdictions, and the same should be true here, that, if the judgment against the defendant is not merely irregular, but is null and void, payment by the garnishee will not protect him in a suit by the 'defendant to recover on tlie debt garnisheed. 20 Cyc. pp. 1146 and 1148. Therefore it will be necessary to inquire into the validity of the judgment against the defendant, on the ground mentioned. Unless repealed, in so far as respects foreign corporations that have done business in the state, and have permanently withdrawn therefrom, leaving no agent to receive service of process, tlie law governing procedure in rem, where a writ of attachment issues, in so far as relates to the service of process, and the appointment of curators ad hoc, is as follows: “If, on the contrary, the defendant has no known place of residence, conceal his person, be absent or reside out of the state, in such case the sheriff shall serve the attachment and citation by affixing copies of the same on the door of the room where the court in which the suit is pending is held.” O. P. art. 254. “In the latter case, the sheriff must keep the copy of the petition, in order to deliver the same to such party, should he appear, or to the advocate appointed to defend him, in his absence.” C. P. art. 255. It will be seen from the above that, in proceedings in rem, where attachments issue, the defendant is cited by posting a copy of the citation and attachment on the courthouse door, and that the copy of the petition alone, is delivered to the curator ad hoc, or advocate, should the absentee fail to appear to receive it. Walker v. Barelli, 32 La. Ann. 467. In all other than attachment suits, or in most of them, the copy of the petition and of the citation is served on the defendant by delivery to the curator ad hoc. C. P. arts. 195, 294, 737; Morris v. Bienvenu, 30 La. Ann. 878. In the case at bar, assuming that such procedure has not been altered or abolished, in respect to foreign corporations, it may be said that the sheriff has sufficiently complied with the law, in so far as relates to the service of process. While he posted the copy of the petition on the courthouse door, instead of retaining the copy, yet that was harmless, since he could have gotten it from there as well as from any other place, to deliver it to the defendant had he appeared. To continue with the method of procedure provided for proceedings in rem, when attachments issue, article 260 of the" Code of Practice provides for the appointment of an advocate, or curator ad hoc, to represent the defendant, and reads as follows: “If, on the contrary, the party fail to appear either in person or by his attorney, the court — 40 — shall appoint an advocate to represent him and defend the suit, and a reasonable delay shall be given to such advocate to enable him to communicate with the party he represents, in order to obtain the information necessary to defend the suit.” , See, also, Code of Practice, art. 116, and Act 219 of 1918. The above constitutes the procedure, in so far as respects the service of process and the authority to appoint a curator ad hoc, which the garnishee, as we appreciate the issue, contends has been repealed by Act 267 of 1914, In so far as relates to foreign corporations that have engaged in business in the state, and have afterwards withdrawn permanently, without leaving an agent upon ■whom process might be served. Let us examine Act 267, which is the corporation act, to ascertain whether there has been such a repeal. Section 26 thereof is the only section that provides for the service of process on foreign corporations, and reads as follows: “That service of all legal process on any foreign corporation subject to the provision of this act shall be made as follows: “(a) On any agent, or agents, which the corporation may have designated, in accordance with existing laws, as agent, or agents, for service or process. This service may be made wherever the agent, or agents, may be found; “(b) If the agent, or agents, mentioned in paragraph (a) of this section, cannot be found, then service may be made upon any regularly employed agent or employee of the corporation, over eighteen years old, in any office which the corporation may have established and maintains in this state; “(c) If the corporation, being one required by law to appoint and maintain an agent for the service of process, has failed so to do, or such agent, if appointed, cannot be found, and said corporation has not established and maintained an office in the state, the officer charged with the duty of making the service, shall, after diligent effort, make return to the court, stating the efforts made by him to secure service, and the reasons for his failure so to do, and thereafter, the judge, or in the event of his absence from the parish, the clerk, shall order service to be made on the secretary of state, whose duty it shall be forthwith, to send, by registered mail, addressed to the corporation at its last-known domiciliary post office address, the originals of the papers served on them, retaining in his office true copies thereof, .upon which he shall note the date, the manner and other particulars of the service, and of the disposition of the originals.” No conflict arises between the service required in subsections “a” and “b” of the above-quoted provision and the procedure indicated above for proceedings in rem, and followed in this case, for the reason that those subsections were manifestly intended to provide for the service of process in proceedings in personam, and therefore relate to an entirely different phase of the subject-matter. It might be said, however, and we understand it to be so urged, that there is a conflict between the procedure in rem, as provided in the Code of Practice, in respect to service of process, and subsection “c” of the above-quoted provision, in that by the latter the service on foreign corporations must be on the secretary of state, under the conditions named in said subsection. If this provision has reference to proceedings in rem, then there is a conflict; but we do not think it was the legislative intention to make it applicable to such proceedings. It will be observed that in subsection “c” service is permitted on the secretary of state only on foreign corporations that are required to appoint and maintain agents in the state for the service of process. The only foreign corporations required to appoint such agents, under the laws providing therefor, are those doing business in the state. The law nowhere requires such corporations to maintain agents for such purpose after they have withdrawn permanently, except probably insurance companies, and then: only for service of process as to causes of action which arose while such companies were transacting business in the state. Hence, under the terms of subsection “c” itself, no' service can be made on the secretary of state, after such withdrawal, whether it be for — 42 — the purpose of obtaining judgment in personam or in rem. However, before concluding that Act 267 of .1914 has not effected the repeal contended for, it is necessary to examine the repealing clause .of that act. That clause specifically repeals numerous acts of the General Assembly and sections of the Revised Statutes, but none on the subject of proceedings in rem, or relative to the appointment of curators ad hoc. It makes the act supersede all provisions conflicting with it found in the Civil Code or Code of Practice, but does not repeal those provisions. However, as there is no conflict between the act and the proceedings in rem, provided by the Code of Practice, relative to the service of process, and the appointment of curators ad hoc, the act did not supersede those articles, and, as a matter of course, for the same reason, no repeal took place. ' , In 1918 the Legislature enacted Act 179 of that year, which is an act regulating the bringing of certain suits, arid the service of civil process, and in providing for service on foreign corporations, carried verbatim into the act of 1918 subsections “a,” “b,” and “c” of Act 267 of 1914, quoted above, and those provisions, as re-enacted in 1918, were in force at the time this suit was instituted, and are still in force. In section 3 of the act of 1918, it is enacted, to quote the section: “That nothing herein contained shall be held to impair or effect [sic] proceedings by attachment or proceedings in rem as now authorized by law, but, as far as applicable, any of the proceedings, and modes of service herein provided fox may be used in such cases.” By this provision it will be observed that proceedings in rem, authorized by law at the time of the adoption of the act, which include those used in this case, are expressly preserved. Hence'no repeal resulted. We therefore conclude that, under the allegations of plaintiff’s petition, and under the law, the court had power to appoint a curator ad hoc to represent defendant and to defend the suit, and that service was properly made on the defendant by posting. The allegation that defendant was permanently absent, and was not represented here, authorized the appointment, and the service of process by posting on the courthouse door. It is true that the petition also alleges that the defendant ■ is about to leave the state permanently, without there being a possibility, in the ordinary course of judicial proceedings, of obtaining or executing judgment against it. This is one of the grounds specified by article 240 of the Code of Practice for the issuance of a writ of attachment, as is also the ground of permanent absence, the latter being, in addition, as stated, a ground for the appointment of a curator ad hoc. The allegation that the defendant was about to leave the state permanently did not deprive the court of jurisdiction to appoint a curator ad hoc, under the allegation of permanent absence. It is permissible, in attachment proceedings, to allege the various grounds for the issuance of the writ, substantially as set forth in the Code of Practice, and to prove one of them on the trial. Coleman & Sharpe v. Teddlie and Nugent, 106 La. 192, 30 South. 99. As the evidence offered, on the confirmation of the default, was not reduced to writing, we presume from the fact that the court rendered judgment on constructive service that the allegation of permanent absence was proved, for otherwise the judgment could not have been rendered legally. The garnishee also urges that the court below should have taken judicial cognizance of the fact, asserted by it, that, at the time this suit was instituted, there was on file, and not revoked, in the clerk’s office of Concordia parish, and in the office of the secretary of state, the appointment by defendant of an agent to represent it, upon whom service of process might have been — 44 — made, and it urges this court to take such notice. While doubtless there are documents in the office of the secretary of state, and perhaps in the office of a clerk of court, outside of the record, that the courts may notice judicially, yet we think that it would be carrying the doctrine of judicial cognizance too far to take judicial notice of the appointment of agents, and of the revocation of such appointments, by foreign corporations. It is true that subsection “e” of section 1 of Act 179 of 1918 requires the secretary of state to send annually to the sheriffs and clerks of court a certified list of all foreign corporations that have appointed agents in the state, together with the names and domiciles of such agents, but the purpose of this provision is not to require the courts to take judicial cognizance of the contents of such lists. As stated, in the subsection, the purpose is to facilitate service of process on such corporations. The lists are for public inspection ; and it may be added that the only ab- . solute assurance the law gives to litigants, or could give them, who use the lists, is that service of process, made according to them, will interrupt prescription. It may be added, though it is unnecessary, that, if a foreign corporation should be proceeded against in rem, by the appointment of a curator ad hoc, when it was maintaining an agent authorized to receive service of process, it has adequate remedy to annul the judgment by direct action. The garnishee also contends that we have decided that defendant has appointed an agent to receive service of process in two cases, which it mentions; that we should take notice of the facts found by us in those cases; that, having found in those cases that defendant once appointed an agent, we should take judicial cognizance of that fact, and should presume that the agency continues, until the contrary is shown, or until a different presumption arises from the nature of the subject under consideration. In Mower v. Kemp, 42 La. Ann. 1015, 8 South. 830, this court took judicial cognizance of the fact that, in a decision rendered by it, in another case, a certain mortgage had been duly authorized. In order to reach that conclusion it was necessary to find that the Legislature had passed an act authorizing the execution of the mortgage. The act was a private one, passed in the interest of a private corporation. The court said: “While it may be true, as a general proposition, that the act of the Legislature authorizing the execution of this act of mortgage, being a private act, should have been introduced in evidence, yet that it was not can make no difference, as we are bound to take' judicial cognizance of our own decisions, and by the terms of the decision just quoted [Vicksburg, Shreveport & Pacific Railroad Company v. Sledge, 41 La. Ann. 869] we are informed that the mortgage was duly authorized and executed [41 La. Ann. 1007].” Without the least disposition to criticize this ruling, it may be said that it is not applicable here. It may be assumed that, in the two cases referred to by the garnishee, this court decided that the defendant had an agent in the state. In one of them, Concordia Land & Timber Company v. Conn (No. 19013), which involved the question of agency, a writ of review was refused, on the face of the record, to review an opinion of the Court of Appeal. This was in September, 1911, some 9 years before this suit was filed. The other case is that of the Fifth Levee District v. Concordia Land & Timber Co. reported in 141 La. 247, 74 South. 921, and decided about 4 years before this suit was instituted. Assuming, therefore, that we held that an agency existed 4 years before the present suit was instituted, we cannot presume that it still existed at the time this suit was filed, in the face of the plaintiff’s petition, alleging that the defendant was permanently absent from the state, and had left it, and was not represented therein, and in the face of the presumption of verity, arising from a judgment rendered on a record, regular on its — 45 — face, of which that petition forms part, and is the basis. The record being regular, the presumption of verity overcomes the presumption that the agency continued to exist up to the time of the institution of this suit. Therefore, finding no error in the record, the judgment appealed from in the case of National Park Bank v. Concordia Land & Timber Company, in which the Black River Lumber Company is garnishee, will be affirmed. In the case of Black River Lumber Company v. National Park Bank, the judgment against the garnishee, above affirmed;, is attacked by the garnishee in a direct action tQ annul it. The Black River Lumber Company alleges, in its suit to annul, that it is not indebted to the Concordia Land & Timber Company in any sum whatever; that, while the interrogatories on facts and articles, addressed to it, to ascertain whether it was indebted to the Concordia Land & Timber Company, were served on it, by delivery to its agent, in this state, on March 12, 1921, yet they were not received by its president, to whom they were forwarded by the agent, until March 28,1921, due to the latter’s absence from home; that the president of the company then forwarded them to the company’s attorney, in Chicago; that the attorney for the company requested Mr. Bullis, the attorney for the National Park Bank, to grant 30 days from March 28, 1&21, in which to answer the interrogatories ; that no response was received, and the request was therefore repeated on April 13th; and, as no reply was received, that, on April 27, 1921, a telegram was sent by the attorney for the plaintiff to Mr. Murch, one of its representatives in this state, requesting him to see Mr. Bullis, and arrange an extension; that a reply was received that Mr. Bullis was not at home, but would be seen later; that on May 3d another telegram was sent Murch to see Bullis; .that to this telegram a reply was sent by Murch on the afternoon of May 3d, and was received on the morning of the 4th, to the effect that Mr. Bullis .did not feel like granting an extension, but would leave the question of taking judgment to the National Park Bank for determination ; that, notwithstanding this statement from Bullis, he, as attorney for the National Park Bank, on the same morning that the telegram that was sent by Murch was received, had the interrogatories taken for confessed, and had judgment entered and signed. The evidence shows that requests for an extension of time within which to answer the interrogatories were made as alleged, and that no replies were received. Mr. Bullis explains his failure to reply by testifying that business affairs prevented his doing so. The evidence shows that plaintiff’s representative sent the telegram of May 3d, to the effect that Bullis would leave the matter to his client as to whether an extension should be granted. The evidence, however, is conflicting as to whether Bullis made such a state-1 ment relative to the extension.' The representative of the Black River Lumber Company testifies that he did. Mr. Bullis testifies that in the conversation which followed the request of Murch for time he (Bullis) stated that he had doubts as to whether the Black River Lumber Company owed the Concordia Land & Timber Company the full amount of the claim of the National Park Bank, and would submit to that bank the question as to whether it would take the money, but at no time consented to an extension, or stated that he would submit that question to the bank. He testifies very positively that he stated to Murch, as the latter left, to tell the attorney for the company that no extension would be granted. The evidence of Bullis is corroborated substantially by that of his stenographer, and especially as to what was — 48 — said as Murch left. The evidence preponderates in favor of the contention that Bullís at no time stated he would submit to the bank the question as to whether an extension should be granted. The burden of proof was on the Black River Lumber Company to establish the agreement, alleged in its petition, that Bullís consented to submit the question of extension of time to the bank; and, as it failed to carry the burden, it has failed in this part of the case. The Black River Lumber Company, however, urges that should we hold, as , we have, then, notwithstanding, the judgment should be annulled for the reason that Murch had been misled into believing that the question of extension would be left to the bank. The witnesses, who have testified as to what was said relative to the extension, are of good repute. Murch hardly would have sent the telegram he did to his principal had he not believed that its contents reflected the truth. On the other hand, Bullís hardly would have taken judgment against the Black River Lumber Company on the morning after the conversation without submitting the question to the bank, and without waiting for a reply, and advising the Black River Lumber Company of the answer, had he promised to submit the question. However, the statement of Bullís to Murch, as the latter left, to tell the attorney for the Black River Lumber Company that no time would be granted, is so clear and well established that any misunderstanding that arose could have been due only to carelessness and inadvertence. Under the circumstances, we would not be warranted in annulling the judgment. The Black River Lumber Company, as it was necessary for it' to do in an action of this nature, has set forth in its petition that it had defenses to make in the garnishment proceeding against it. Those defenses were as follows: That it was not indebted to the Concordia Land & Timber Company, and, if it were, that prescription had run against the debt, and, if not, that it has a demand to plead in compensation against it; and, lastly, that the debt was not subject to garnishment. It _ is, however, unnecessary to pass on those defenses, as we have found that there does not exist sufficient ground to annul the judgment. While in a suit of this nature, the plaintiff should show that he has defenses to make to the demand upon which the judgment was rendered, yet the fact that he has such defenses is not of itself sufficient to annul the judgment. In respect to the last defense stated, it may be said, however, that the first interrogatory propounded sought to elicit whether the Black River Lumber Company was indebted to the Concordia Land & Timber Company, and, if so, whether in a sum sufficient to pay the demand of the National Park Bank against the latter company. A failure to answer that interrogatory within the time prescribed by law, no extension having been granted, authorized that the interrogatory be taken for confessed, and authorized the judgment rendered against the Black River Lumber Company. C. P. art. 203. When the suit to annul was filed, the Black River Lumber Company sued out a writ of injunction, enjoining the execution of the judgment against it. The court below allowed the National Park Bank, for the wrongful issuance of the writ, damages, under article 304 of the Code of Practice, amounting approximately to 4 per cent, of the amount of the judgment enjoined. The National Park Bank, in its answer to the appeal, has asked that these damages be increased. We see no sufficient reason to increase them. For the reasons assigned, it is ordered, adjudged, and decreed that1 the judgments appealed from, in both of these consolidated cases, be, and the same are hereby, affirmed; the appellant to pay the costs.