Searcy & Co. v. Their Creditors

The opinion of the court was delivered by Miller, J. This is an appeal by the syndic and his attorneys from the judgment of the lower court maintaining an opposition of a creditor to the syndic’s account. The funds in his hands were mainly derived from the sale of the effects in premises leased by the insolvents, and the rent for the unexpired term of the lease is unpaid. Among these effects were certain movables, bought by the insolvent, sold separately at the instance of the unpaid vendor, realizing more than enough to pay him, and on the proceeds he asserts the vendor’s privilege. Besides the funds arising from the sale of .all these effects in the leased premises subject to the special privileges of the lessor and vendor, there are funds for distribution derived from other sources. There were two accounts filed. The first exhibited privileged debts incident to the syndic’s administration and others; the aggregate of all these privileged debts were deducted from the mass of the funds and the residue awarded to the lessors. It is obvious the account was not framed in accordance with the provisions of the law directing the distribution of funds when there are general and special privileged debts to be paid from funds, a portion of which are subject to no special privilege, and another, in this case the larger portion, is charged with the privileges of the lessor and vendor. •Civil Code, Arts. 8191, 3252, 3254, 3256, 3263. The account was homologated as far as not opposed, the only opposition coming from the unpaid vendor of the movables sold separately. The opposition asserting the right of payment over all, save the charges of sale, from [378] the proceeds of the movables, was sustained and the syndic directed to recast his account. The syndic then filed another account, in which he pursued the same method of distribution of paying the mass of all privileged debts from the mass of all the funds. This account was homologated as far as not opposed; like the first met with no opposition except from the unpaid vendor asserting his privilege for the unpaid price, on the proceeds of the movables he had sold, paramount over all save charges of sale. On the last account the total funds were stated $3390. The privileged debts, attorneys and notaries’ fees, auctioneer’s commissions, syndic’s commissions, clerk hire and others figured on the account amounting to §1813.11. All deducted from the mass of all the fundsleft §1576.97, and this residue was awarded to the lessor, his unpaid rent amounting to §2700.00, for which he was put on the account. The lessor was left unpaid for a large portion of his rent, and there was nothing for the unpaid vendor. On the opposition the court decreed that privileged debts —i. e., charges for attorneys and notaries’ fees, were inferior to the privilege of the unpaid vendor, and that he should be placed on the account with preferences over these fees amounting to $590; the-court farther decreed that the lessor as well as the vendor had preference over these fees, and reduced §100 on the account as reserved for costs to $20. Prom this judgment on the opposition this appeal is taken by the syndic and his attorneys, whose fees are subordinated by the judgment to the special privileges. The contention of the attorneys is, that by the judgments homologating the accounts as far as not opposed, their fees were to be paid by preference over the lessor; that these judgments constituted res judicata against the lessor, who made no opposition. The contention of the syndic is, that he can pay only to the extent of the funds in his hands, and that the uncontested privileged debts and the lessor’s unpaid rent, more than absorb all the funds, hence the judgment is erroneous in ordering the opponent to be put on the account. The judgments homologating these accounts as far as not opposed determined as against all, save the opponent, that all these-privileged debts were to be paid before the lessor. Whatever may be said of the method of distribution adopted by the syndic these judgments must have effect. Burrell vs. Read, 14 La. 242; Mayfield vs. Comeaux, 7 N. S. 182; 1 Hennen’s Digest, p. 759, Nos. 2, 9, et seq. The lessor whose privilege is superior to that of the opponent [379] (Civil Code, Art. 3262) is certainly bound by these judgments, according preference to all privileged debts. This preference fixed by the judgments homologating the account, could not be disturbed by the judgment of the lower court subsequently rendered on the opposition only of the unpaid vendor. On that opposition the privileged debts to the extent of $590, are excluded from competition with opponent. But with that exclusion there remains on the account privileged debts ranking as first in order of payment amounting to $1223. These debts as to amount, save the reserve of $100, were not called in question by the opposition. The judgment unappealed from by the opponent leaves them in full force. The lessor’s claim figures on the account at $2740, not opposed and maintained by the judgment. Thus, there stands between opponent and the relief he seeks over $3900 of superior privileges recognized by final judgment. The privileged debts to the extent of $1223 are beyond the domain of contention by the absence of opposition, and the judgment acquiesced in, and the priority of the lessor over the opponent is fixed, not only by the judgment but by the law (C. C., Art. 3258). The judgment of the lower court responding to the demand of the opponent asserts the preference given .to him, when there are funds that can be so applied, consistently with debts of the higher rank. ■ The difficulty in opponent’s caséis that in the plenitude of his privilege, still there is no room for him on the account. It is therefore ordered, adjudged and decreed that the judgment of the.lower court be avoided, annulled and reversed at the costs of the appellees.