Bank of Sunset & Trust Co. v. Charlot, 92-250

• Decision Date: 03 March 1993
• Docket Number: No. 92-250,92-250
• Parties: BANK OF SUNSET & TRUST COMPANY, Plaintiff-Appellant, v. A.J. CHARLOT, Sr., et ux., Defendants-Appellees.
• Court: Court of Appeal of Louisiana — District of US

Page 1386

614 So.2d 1386

BANK OF SUNSET & TRUST COMPANY, Plaintiff-Appellant, v. A.J. CHARLOT, Sr., et ux., Defendants-Appellees.

No. 92-250.

Court of Appeal of Louisiana,

Third Circuit.

March 3, 1993.

Carl M. Duhon, Lafayette, for plaintiff-appellant.

Armand J. Brinkhaus, Francis A. Olivier III, Sunset, for defendants-appellees.

Before DOMENGEAUX, C.J., and KNOLL and SAUNDERS, JJ.

KNOLL, Judge.

The very limited question presented in this appeal is whether service on the Sunset Bank & Trust Company, a Louisiana bank, of a Kentucky judgment for spousal support in favor of Burgunde Charlot for past due maintenance payments, not made executory in Louisiana, along with a copy of a foreign court order purporting to garnish the bank account of A.J. Charlot, Sr., is sufficient to allow the bank to invoke a concursus proceeding to determine to whom the bank should pay the funds.

The trial court dismissed the concursus proceeding, finding that the non-executory order of garnishment and its attached judgment did not present the Bank with a competing or conflicting claim to the money on deposit.

The Bank appeals contending that the trial court erred in dismissing the concursus proceeding. In an ancillary issue, the Bank contends that the trial court further erred when it denied a motion to remove Mr. Charlot's attorney as counsel of record on the basis that he was the former counsel for the Bank.

Mr. Charlot has answered the appeal, asking for damages and attorney's fees for the Bank's prosecution of a frivolous appeal. We affirm and award damages.

FACTS

On October 3, 1991, A.J. Charlot, Sr. had $682.02 on deposit in the Bank of Sunset & Trust Company. That day a St. Landry Parish deputy sheriff served the bank with an order of garnishment from the Court of Justice in the County of Hardin, Commonwealth of Kentucky. Attached to the garnishment order was a copy of a judgment against A.J. Charlot, Sr. dated September 9, 1991, for arrearages in spousal maintenance in favor of Burgunde M. Charlot and an order dated September 18, 1991, ordering A.J. Charlot to continue paying Burgunde M. Charlot $1,000 per month for her maintenance.

On October 4, 1991, counsel for A.J. Charlot, Sr. wrote a letter to the Bank demanding that it release the funds deposited and put the Bank on notice that a lawsuit would be filed if it failed to comply.

The Bank responded by depositing the funds from Mr. Charlot's account into the registry of the court, and impleaded Mr. and Mrs. Charlot so that they could assert their respective claims to the funds.

Mr. Charlot filed a motion and order to dismiss the concursus proceeding because the documents from Kentucky were not first made executory in Louisiana and were not entitled to standing in this state. A hearing was held on Mr. Charlot's motion on December 6, 1991. The Bank and Mr. Charlot were present and represented. Ray Bordelon, the Bank employee who received the foreign state garnishment order, testified and the trial court received five documents into evidence.

The trial court informed counsel that it would not consider Mr. Charlot's motion as a motion to dismiss, because in non-jury cases such a motion can only be made at the close of plaintiff's case. Instead, the trial court treated Mr. Charlot's motion as a motion for summary judgment, and ruled in favor of Mr. Charlot, stating as follows:

"[C]ritical to that [Kentucky] order was the absence of anything indicating that judgment had been made executory in Louisiana. Now don't you think that just with a little cursory examination and investigation that the bank would have alerted itself of that fact and would have found that this is not a garnishment in Louisiana, and then that puts that bank or the judgment from Kentucky--the demand from Kentucky as nothing more than a man off the street.

* * * * * *

On the issue of whether or not summary judgment should be granted dismissing the concursus proceeding, the Court first of all notes that the judgment that was served was one for a support judgment taken in Kentucky. These judgments are to be enforced through a Uniform Support Act. I think Kentucky is a party to that compact.

* * * * * *

[T]herefore they should have gone through the local enforcement office ... I simply find that the facts before me that there were no legal competing claims. Ostensibly there were some competing claims but one was legal and one was not. I see this thing from Kentucky as being nothing more than a man off of the street who would have walked into the bank and said, I have a claim on Mr. Charlot's account, give me the money. And I think a very cursory investigation would have revealed that. For that reason I'm going to set aside the concursus...."

TRIAL COURT'S PROCEDURE FOR DISMISSAL

From the outset, we note that the trial court correctly determined that Mr. Charlot's motion for dismissal was not a proper procedural tool at the pre-trial stage of this litigation.

However, after carefully reviewing the record, we find that the trial court should have treated Mr. Charlot's motion as a peremptory exception of no cause of action. In essence that was the trial court's determination.

The trial court may notice on its own motion the failure to disclose a cause of action. LSA-C.C.P. Art. 927. Since the trial court could have noticed this peremptory exception on its own, we consider it inconsequential that Mr. Charlot incorrectly raised the objection through a motion to dismiss. Accordingly, we find that the issue of no cause of action is properly before us, and we will address the assignment of error in this light. See E.M.W., Jr. v. J.P.M., 583 So.2d 511 (La.App. 2nd Cir.1991).

DISMISSAL OF CONCURSUS

The Bank contends that the trial court erred in ruling that it could not institute a concursus proceeding. It argues that the deputy's service on it of a judgment and garnishment order affecting Mr. Charlot's bank account was sufficient to establish a competing or conflicting claim to the funds.

LSA-C.C.P. Art. 4651 provides:

"A concursus proceeding is one in which two or more persons having competing or conflicting claims to money, property, or mortgages or privileges on property are impleaded and required to assert their respective claims contradictorily against all other parties to the proceeding."

The purpose of the concursus proceeding is equitable in nature, meaning to protect a person finding himself in possession of money which is not his from having to referee the rights of rival claimants and risk paying same to the wrong party. Transo Investment Corporation v. Oakley, 37 So.2d 560 (La.App. 2nd Cir.1948).

The threshold element for the initiation of a concursus proceeding in the case sub judice is the existence of at least two persons who have competing or conflicting claims to money. As viewed by the trial court, Mr. Charlot had the only claim to the money. We agree.

It is black-letter law in Louisiana that the only method of procedure in this state for the enforcement of an out-of-state judgment is by ordinary action in this state with citation and service. Henson v. Henson, 112 So.2d 664 (La.1959); LSA-C.C.P. Art. 2541; LSA-R.S. 13:4241, et seq. In State v. Dunn, 148 La. 460, 87 So. 236, 238 (La.1921), Justice O'Neil stated:

"In Cole v. Cunningham, 133 U.S. 107, 10 Sup.Ct. 269, 33 L.Ed. 538 [ (1890) ], referring to the provision in section 1 of article 4 of the Constitution of the United States, that full faith and credit shall be given in each state to the judgments of another state, it was said:

Such constitutional provision does 'not make the judgments of the states domestic judgments to all intents and purposes, but only gives a general validity, faith and credit to them as evidence.

'No execution can be issued upon such judgments without a new suit in the tribunals of other states, and they enjoy, not the right of priority or privilege or lien which they have in the state where they are pronounced, but that only with the lex fori gives to them by its own laws, in their character of foreign judgments.'

In McKenzie v. Havard, 12 Mart. (O.S.) 101, it was said:

'Judgments, in other states, do not give any lien here, when their execution is not ordered by a judge of this [state].'

* * * * * *

In the Succession of Lucas, 11 La.Ann. 296, it was said:

'Foreign judgments have no executory force in this state until they acquire it by the judgment and fiat of...