Ernest M. Loeb Co. v. AVOYELLES DRAINAGE DIST., ETC.

• Decision Date: 02 May 1945
• Docket Number: Civil Action No. 220.
• Citation: 60 F. Supp. 296
• Parties: ERNEST M. LOEB CO., Inc., v. AVOYELLES DRAINAGE DIST. NO. 8 OF PARISH OF AVOYELLES, LA., et al. (FEIBLEMAN, Intervener).
• Court: U.S. District Court — Western District of Louisiana

60 F. Supp. 296

ERNEST M. LOEB CO., Inc., v. AVOYELLES DRAINAGE DIST. NO. 8 OF PARISH OF AVOYELLES, LA., et al. (FEIBLEMAN, Intervener).

Civil Action No. 220.

District Court, W. D. Louisiana, Alexandria Division.

May 2, 1945.

COPYRIGHT MATERIAL OMITTED

A. M. Suthon, of New Orleans, La., for plaintiff.

W. E. Couvillon and S. Allen Bordelon, both of Marksville, La., for defendant.

Titche & Titche, of New Orleans, La., for intervenor.

Maxwell J. Bordelon, of Marksville, La., for opponent.

PORTERIE, District Judge.

On December 29, 1939, The Ernest M. Loeb Co., Inc., the plaintiff, filed a civil action against the Avoyelles Drainage District No. 8 of the Parish of Avoyelles, Louisiana, defendant, alleging that it is the owner of some sixteen (16) bonds issued by the defendant, each in the principal sum of $500, which were past due and unpaid at the time of the suit. Of these bonds declared upon by plaintiff, three matured June 1, 1929; three, June 1, 1930; two, June 1, 1931; three, June 1, 1936; one, June 1, 1937; and four, June 1, 1939. Plaintiff also sued upon seven other bonds of the same series, also of the principal amount of $500 each, which were not yet matured, but which it alleged would mature June 1, 1940.

The petition fully describes these bonds, and shows that the twenty-three bonds owned by the plaintiff company were all of the same issue of one hundred and fifty bonds, each in the principal sum of $500, dated June 1, 1919, all of like tenor and effect except as to maturity and serial number. Paragraph II of plaintiff's petition gives the form and wording of the bonds, which show that they were issued by the drainage district for the purpose of constructing canals and ditches and such other things pertaining to or necessary for the proper and efficient drainage of the land of the district, as authorized by law, and also for the government of said district. The language of the bonds further shows that they were issued in compliance with the constitution and laws of the state of Louisiana, and especially Article 281 of the Constitution of Louisiana (Constitution of 1913), Acts 256 and 317 of the General Assembly of the State of Louisiana of the year 1910, as subsequently amended, and certain ordinances of the Board of Commissioners of the Avoyelles Drainage District No. 8 of the Parish of Avoyelles, Louisiana, specifically referred to by date.

Plaintiff also alleges that it is the owner of thirty-seven past due interest coupons, each in the sum of $25 (this series of bonds bore interest at five per centum per annum from date payable annually on the 1st of June of each year during which the interest on the particular bond would run). The bond numbers and the due years of the interest coupons are, as follows: 107— 1936; 108—1936; 116—1937; 130—1937-8-9; 131—1937-8-9; 132—1937-8-9; 133— 1937-8-9; 143—XXXX-X-X-X; 145—1937-8-9; 146—1937-8-9; 147—1937-8-9; 148—1937-8-9; 149—1937-8-9; 150—1937-8-9.

On the trial of a motion to dismiss because of failure to state a claim for which relief can be granted, filed by the defendant, diversity of citizenship being conceded, the court overruled defendant's motion, for reasons set forth in the judgment signed on May 9, 1941.

Thereafter, on June 30, 1941, the defendant drainage district filed its answer. Previously, on January 13, 1941, upon order of the court of January 11, 1941, T. Jeff Feibleman intervened, alleging that he is the owner of seventeen bonds of the same issue, and seeks against the defendant drainage district similar relief to that prayed for by plaintiff.

The description of the seventeen bonds, given in Paragraph II of the petition of intervention filed by Feibleman, shows that four of them matured June 1, 1936; six of them matured June 1, 1937; four of them matured June 1, 1938; one of them matured June 1, 1939; and two of them matured June 1, 1940. The listings of coupons attached show that the attached coupons include only those due June 1, 1936 and on various subsequent dates.

A stipulation, filed on September 8, 1941, between the defendant drainage district and T. Jeff Feibleman, admits that the proper jurisdictional facts appear, that the intervenor is a proper party and is the holder and owner for value of the seventeen bonds; that these bonds are past due and unpaid and consequently in default; and further that the answer filed to plaintiff's petition shall be deemed, insofar as applicable, as filed with reference to the petition of intervention, and, expressly, the issue shall be regarded as having been joined on the petition of intervention.

After various attempts at amicable settlement of the issues, and after extensions of time granted by the court in view of such attempts, the then parties to the suit, namely, (1) The Ernest M. Loeb Co., Inc., plaintiff, (2) T. Jeff Feibleman, intervenor adopting the position of plaintiff, and (3) Avoyelles Drainage District No. 8 of the Parish of Avoyelles, State of Louisiana, defendant, filed on October 20, 1944, a joint motion of all parties for a partial distribution of funds. The following judgment was rendered and signed:

"This cause came on to be heard on the joint motion of The Ernest M. Loeb Company, Inc., T. J. Feibleman, and Avoyelles Drainage District No. 8, of the Parish of Avoyelles, being, respectively, Plaintiff, Intervener, and Defendant, and constituting all of the parties hereto, and good cause appearing:

"It is ordered, that Defendant, Avoyelles Drainage District No. 8, of the Parish of Avoyelles, pay on account of the principal of each of the seventy-two bonds of the issue sued on, the sum of Two hundred fifteen and 27/100 ($215.27) dollars, payment to be made upon the presentation of each of said bonds to the Union Bank at Marksville, Louisiana, for proper endorsement of payment thereon; that there be paid to W. E. Couvillon and S. Allen Bordelon, Esqs., jointly, Attorneys for Defendant, as attorneys' fees, the sum of Seven hundred fifty ($750.00) Dollars; further attorneys' fees, if any, to be fixed by the Court.

"It is further ordered, that the remaining sum of One thousand two hundred forty-eight and 82/100 ($1248.82) dollars be retained by the Defendant, Avoyelles Drainage District No. 8, of the Parish of Avoyelles, subject to the further orders of this Court, and that nothing be paid therefrom except upon order of this Court after due proceedings herein.

"It is further ordered, that these proceedings remain on the docket without prejudice to any claim asserted herein, or any defense made, save that proper credit be given for the payments made by Defendant.

"It is further ordered, that after the payments herein ordered be made, the parties hereto be given until February 15th to further plead or appear herein.

"It is further ordered that a written notice of the pendency of this motion and application be mailed by the defendant Avoyelles Drainage District No. 8 of the Parish of Avoyelles, to each bond holder at his last known address allowing 30 days to file any opposition thereto and if no such opposition be made that said defendant proceed to make the payments as herein ordered."

Within the thirty days allowed by this judgment, C. W. J. Neville filed a motion to dismiss this action and the proposed distribution of funds as contained in the order or judgment quoted above, "for the reason that most of the bonds in the series are prescribed by the limitation of five years." He further alleged that all of the bonds matured more than five years prior to the date of his motion, are prescribed, and that he, as owner of bonds No. 138 and No. 139, should be paid in preference and priority over all other claims, for the reason that he has protected his rights by obtaining a judgment against the defendant on May 3, 1940. Neville further cited the provisions of Article 3540 of the Revised Civil Code of Louisiana in support of his plea of prescription and motion to dismiss. His prayer asked that the order or judgment approving the joint distribution proposed by plaintiff, intervenor and defendant be annulled, voided and set aside and that mover's claim be paid by preference and priority over all other claims in this proceeding and that plaintiff's suit be dismissed at its cost.

On date of argument on this motion, counsel for Neville filed, alternatively, a petition for a writ of mandamus, in which he seeks from the court an order upon the defendant, commanding it to pay to Neville and by preference and priority over all other claims, the amount of $500 each for his bonds Nos. 138 and 139, plus the sum of $50 on each bond to cover two interest coupons attached, or else to show cause to the contrary. Without signing the order directing that alternative writs of mandamus issue, the court heard argument as to whether or not mandamus would lie, and this question was submitted along with those involved in the consideration of the motion to dismiss on the ground of prescription.

I. The opponent, Neville, claims that Article 3540 of Civil Code of Louisiana, with provision of five years, controls the issue.

Opponent has mistaken his remedy, if indeed he has any remedy. Of the twenty-three bonds on which plaintiff declares, only eight matured before June 1, 1936. The present suit was filed on December 29, 1939. Although as to those eight bonds of earlier maturity, the last two of which matured June 1, 1931, the opponent's motion might have some merit on the face of it (and it has no actual merit in any respect, for reasons we shall give later), it is obvious that any prescription that might otherwise have accrued on the fifteen bonds maturing June 1, 1936, and various dates thereafter, was interrupted when this suit was filed on December 29, 1939, before prescription had fully run on any of them.

It has been decided that the prescription of five years established by Article 3540 applies to bonds, unless, of course, there has been some acknowledgment or other interruption. How...