Burglass v. Wright

• Decision Date: 04 February 1935
• Docket Number: 14894
• Citation: 159 So. 176
• Court: Court of Appeal of Louisiana — District of US
• Parties: BURGLASS v. WRIGHT et al

159 So. 176

BURGLASS v. WRIGHT et al

No. 14894

Court of Appeal of Louisiana, Orleans.

February 4, 1935

Rehearing denied March 4, 1935.

Solomon S. Goldman, of New Orleans, for appellant.

Normann & McMahon and Harold M. Rouchell, all of New Orleans, for appellees.

OPINION

LECHE Judge.

On September 30, 1930, plaintiff sold and delivered to James H Wright a certain lot of furniture for the price and sum of $ 822.30. Wright paid in cash the sum of $ 80, and for the balance of the purchase price, the sum of $ 742.30, he executed a chattel mortgage in favor of plaintiff, wherein plaintiff retained his vendor's lien and privilege upon the said furniture. Wright also executed his promissory note in the said sum, and the chattel mortgage was duly and properly recorded on October 1, 1930. On January 31, 1931 Wright placed the furniture which he had thus purchased from petitioner in storage with the O. K. Storage & Transfer Company, Inc. He then became delinquent in his monthly payments to petitioner under the terms of the chattel mortgage, and also became delinquent in the payment of the monthly storage charges to the O. K. Storage & Transfer Company. On or about January 12, 1933, Wright was adjudged a voluntary bankrupt in the United States District Court for the Eastern District of Louisiana.

The following order, which we quote from counsel's brief, was entered by the referee in bankruptcy:

"Let there be waiver and disclaimer entered by the Bankrupt estate of any right, title, claim, interest, advantage or ownership in, to or against any of the household effects bought by the Bankrupt from A. Burglass, which household effects are presently stored with the O. K. Storage Co. and on which there is presently due the O. K. Storage Co. the sum of $ 124.98 as storage charges conditioned upon the payment by A. Burglass of the sum of Fifty Dollars ($ 50.00) cash with the reservation to the O. K. Storage Co. of their rights as against the furniture stored by the Bankrupt with them;

"Let the settlement of the storage charges due the O. K. Storage Co. of $ 124.98 be eliminated from any consideration in these bankruptcy proceedings, and let the settlement of the storage charges due the O. K. Storage Co. of $ 124.98 be by and as between the O. K. Storage Co. and A. Burglass."

The bankruptcy court thus disclaimed any further interest in the matter, leaving to the parties their right to settle the matter as between themselves and independently of the bankruptcy proceedings. Thereafter, on March 30, 1933, plaintiff filed this suit against Wright and the O. K. Storage & Transfer Company, Inc., praying for a money judgment against Wright and praying that petitioner's vendor's privilege and chattel mortgage lien be declared superior to any lien, privilege, or claim of the O. K. Storage & Transfer Company, Inc., and asking that the court order said company to turn the merchandise over to the civil sheriff for the purpose of being sold at public auction, etc. The O. K. Storage & Transfer Company, Inc. answered, pleading the priority of its privilege for storage and preservation of the property over the vendor's privilege and chattel mortgage lien of plaintiff, and further pleading that, by reason of plaintiff's course of action and conduct in permitting and encouraging it to incur necessary charges and expenses for the preservation of said property, he is estopped to urge his alleged privileges as prior to its rights. This defendant further prayed for judgment in reconvention against plaintiff in the sum of $ 132.98, being the amount due them for storage up to and including March 31, 1933, together with interest on said amount from the date of plaintiff's suit. No answer being filed by Wright, judgment by default was entered against him as prayed for, and further judgment was entered in favor of defendant O. K. Storage & Transfer Company, Inc., and against plaintiff on the reconventional demand, decreeing that plaintiff was estopped from enforcing, or attempting to enforce, the lien resulting from his chattel mortgage on the stored furniture, and that, out of the proceeds of the sale by the civil sheriff, the sum of $ 152.40 be paid to the O. K. Storage & Transfer Company, above and in preference to the claim of plaintiff under his chattel mortgage.

From this judgment plaintiff has appealed.

Two questions are presented here, the first, a question of law, being whether or not plaintiff's vendor's privilege and chattel mortgage primes the subsequently accruing privilege or lien of the O. K. Storage & Transfer Company for the storage and preservation of the property. The second question, one of fact, is whether or not plaintiff's conduct was such as to encourage the storage and preservation of the property on the faith of his guaranty, and consequently estopping him from now asserting his priority. We will consider the second question first, because, if the plea of estoppel is good, it is immaterial whether or not plaintiff's chattel mortgage primed defendant's privilege, and a consideration of that point will be unnecessary.

A careful reading of the transcript in this case reveals that certain oral testimony in support of the plea of estoppel was admitted by the learned trial judge over the objection of counsel. The rulings of the trial judge were correct and proper in the circumstances. This proceeding is entirely different from one in which it is sought to prove that defendant had guaranteed the debt of a third person. In such a case strict rules of evidence are adhered to, and such proof must be in writing. In support of the plea of estoppel, the rules are much more lenient. In the case of Breaux et al. v. Albert Hanson Lumber Co., Ltd., 125 La. 421, 51 So. 444, 446, the court said: "We hold that the bad faith of this plaintiff was susceptible of proof by parol, and that the oral testimony admitted to that end was admissible.

"It may also be proven by oral testimony all that is needful to sustain the plea of estoppel. In this instance this plaintiff, by his representation and connivance, estopped himself from charging the defendants with trespass and wrongdoing."

Now, perhaps, for the very reason that the strict rules of evidence are somewhat abated in supporting the plea of estoppel, he who urges the plea is held to a strict proof of his allegations in support thereof. In the case of Young et al. v. Longshoremens' P. U. Ben. Association, 7 Orleans App. 146, the court said: "The facts upon which estoppel is based must be proved by the party urging the plea." And in Hebert v. Champagne, 144 La. 659, 81 So. 217, 218, Chief Justice Monroe said: "The burden of proof in such case rests upon the pleader, and he must prove the very facts upon which the estoppel is based. In order that one should be denied his right, or deprived of his property, by reason of an equitable estoppel, it should appear that the person pleading the estoppel has been misled, by the other, to his prejudice." The general rule is very clearly stated in 21 C. J. p. 1250, §267, as follows: "Under the rule that he has the burden of proof who has the affirmative of the issue, the burden of proof is on the party alleging and relying on an estoppel to establish all the facts necessary to constitute it, by a preponderance of the evidence, subject of course to the proper presumptions which may be indulged under the facts of the particular case. Where the evidence is evenly balanced the burden is not sustained." The evidence in this case in support of the plea of estoppel consists entirely in the testimony of Mr. Polders, assistant manager of the O. K. Storage & Transfer Company. He testified that the furniture was placed in storage in his warehouse in January, 1931, and that at that time it was not made known to him that any one other than Wright would pay the storage charges. He testified that his first conversation with Mr. Burglass was over the telephone and about a year after the furniture had been stored; that Mr. Burglass told him that Wright had made arrangements with some relative to take care of the account, and that he knew Mr. Wright to be honest and truthful and that he wanted the goods held up from the sale, stating that he would guarantee the storage account, as he knew that Mr. Wright within a short time would receive money for the payment of his own bill and that of the O. K. Storage people and that he would guarantee the account if the goods were withheld from sale; that Mr. Burglass was asked to confirm this in writing, but no letter was ever received. Mr. Polders further testified that he subsequently had another telephone conversation with Mr. Burglass, in the course of which Mr. Burglass denied ever having guaranteed the account. Mr. Polders also testified that on two different occasions the furniture was withheld from sale by his company at the request of Mr. Burglass. The sum and substance of his testimony is that his company relied solely on the guaranty of Burglass to pay the storage charges.

As opposed to this, we have the testimony of Mr. Burglass, who stated that never at any time did he guarantee the account of Wright, but at all times relied on what he believed to be the priority of his chattel mortgage lien. In answer to a question as to whether or not he had guaranteed this payment, Mr. Burglass answered: "If your honor will permit me to answer that question I believe it is an insult to my intelligence that, having a prior claim and knowing that that I would guarantee a claim that has no right at all. I think I am too much of a business man for that purpose."

He admitted the telephone conversation with the storage company but his version of it is that he told them that he was carrying the account of Wright for a large sum; that he...