Ernest M. Loeb Co. v. AVOYELLES DRAINAGE DIST. NO. 8

• Decision Date: 27 July 1950
• Docket Number: Civ. A. No. 220.
• Citation: 92 F. Supp. 126
• Parties: ERNEST M. LOEB CO., Inc., v. AVOYELLES DRAINAGE DIST. NO. 8 OF AVOYELLES PARISH, LA. (FEIBLEMAN, Intervenor).
• Court: U.S. District Court — Western District of Louisiana

92 F. Supp. 126

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

Civ. A. No. 220.

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

July 27, 1950.

Archie M. Suthon, New Orleans, La., for plaintiff.

Wade E. Couvillon and S. Allen Bordelon, Marksville, La., for defendant.

Charles A. Riddle, Jr., District Attorney, Avoyelles Parish, Marksville, La., ex officio, for defendant.

Bernard Titche, Jr., New Orleans, La., for intervenor.

PORTERIE, District Judge.

On December 29, 1939, The Ernest M. Loeb Co., Inc., the plaintiff herein, filed a civil action against the Avoyelles Drainage District No. 8 of the Parish of Avoyelles, Louisiana, defendant, alleging that plaintiff is the owner of some sixteen (16) bonds issued by the defendant, each in the principal sum of five hundred ($500.00) dollars, which were past due and unpaid at the time the suit was filed. 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 declared upon seven (7) other bonds of the same series, and also of the principal amount of five hundred ($500.00) dollars each, which were not yet matured when this suit was filed but which it alleged would mature June 1, 1940.

The petition fully describes these bonds and, in addition to giving the facts already stated, shows that the twenty-three (23) bonds owned by plaintiff company were all of the same series, which comprised one hundred and fifty (150) bonds, each in the principal sum of five hundred ($500.00) dollars, dated June 1, 1919, and 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 of this series, which show that they were issued by the defendant 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 defendant drainage district, as authorized by law, and also for the government of said district. The recitals of the bonds of this series further show 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 certain past due interest coupons, each in the sum of twenty-five ($25.00) dollars. This series of bonds bore interest at the rate of five (5%) per cent per annum from date, payable annually on the 1st of June of each year, during which the interest on the particular bond would run.

On the trial on the merits, had on March 14, 1950, plaintiff was admitted to be the owner for value of the bonds sued on and of forty-three (43) coupons of the face value of twenty-five ($25.00) dollars each. Thus, plaintiff sued for $11,500.00, total principal of its twenty-three (23) bonds, with legal interest at the rate of five (5%) per cent per annum on each of these bonds from their respective due dates until paid; and also by the effect of the admission referred to, for $1,075.00 total face value of coupons, with legal interest at the rate of five (5%) per cent per annum on each of the coupons from their respective due dates until paid.

It is also stipulated that on each of the bonds there should be a credit on the principal amount thereof in the sum of $215.27 paid as of June 15, 1945, in accordance with the judgment of this Court, dated October 19, 1944, in this cause. Deducting the credit from the sum of $500.00 there thus remains due on the principal of each bond $284.73. The principal still due on the twenty-three (23) bonds thus amounts to $6,548.79.

T. Jeff Feibleman, by his petition of intervention filed on January 13, 1941, upon order duly signed under date of January 11, 1941, sued on seventeen (17) bonds of the same series, each of the principal amount of $500.00, and various coupons attached to most of them; and adopted the same legal position as the plaintiff corporation. The description of the seventeen (17) bonds, given in Article II of the petition of intervention filed by Feibleman, shows that four (4) of them matured June 1, 1936; six (6) of them matured June 1, 1937; four (4) of them matured June 1, 1938; one (1) of them matured June 1, 1939; and two (2) of them matured June 1, 1940.

On the trial on the merits it was also stipulated that Feibleman is the holder and owner for value of the seventeen (17) bonds on which his intervention is based and of forty (40) coupons attached to various of his bonds.

His intervention thus prayed for a judgment against the defendant drainage district for $8,500.00, total principal value of his bonds with legal interest at five (5%) per cent per annum on each bond from its respective due date, and also for $1,000.00, total face value of his coupons, with legal interest thereon as prayed for in his intervention.

It was also stipulated that Feibleman has received payment on the principal of each of his bonds of $215.27 as of June 15, 1945, in accordance with the judgment of this Court, dated October 19, 1944, in this cause. There thus remains due him, by way of principal, the sum of $284.73 on each of seventeen (17) bonds, or a total for his bonds of $4,840.41. Both of these admissions about the payments on account of principal show that they were made by the defendant drainage district.

Plaintiff and intervenor have each prayed for a moneyed judgment against Avoyelles Drainage District No. 8 of the Parish of Avoyelles, Louisiana, each on bonds and coupons, with interest.

Plaintiff has further prayed that defendant be required to pay to plaintiff whatever money it had in its possession, custody or control from taxes dedicated as security for the payment of the bonds and interest coupons owned by plaintiff, up to the amount of the judgment plaintiff prayed for. Intervenor prayed that the defendant be required to pay such money as it might have on hand, or as might accrue to it by virtue of taxes collected on account of the tax dedicated as security for the payment of the bonds of the series of date June 1, 1919, to the holders of the bonds of that series.

Both plaintiff and intervenor prayed that defendant be required to account for all money collected from the taxes dedicated by law solely to the payment of the bonds and interest coupons of the issue referred to.

Plaintiff further prayed as follows: "(4) That in the event that there are not sufficient funds available in the possession, control or custody of defendant or from the account from it hereinbefore required, defendant be required to extend the levy and collection of the taxes for the payment of the bonds and interest coupons, herein sued upon; that in the alternative, defendant be required to refund the said bonded indebtedness of the outstanding bonds of the said issue, as provided for under the constitution and statutes of Louisiana, in such cases made and provided."

Intervenor prayed similarly, although in somewhat different language.

Each of them demanded recovery of their costs and reasonable attorney's fees from defendant; and also prayed for further and for general relief.

The defendant filed what its attorneys called an "Exception of no cause of action", which was treated by this Court as a "Motion to dismiss because of failure to state a claim for which relief can be granted". On the trial of this exception diversity of citizenship was conceded. The Court overruled the exception and dismissed defendant's motion, for reasons set forth in the judgment signed on May 9, 1941.

Thereafter, on June 30, 1941, the defendant, Avoyelles Drainage District No. 8 of the Parish of Avoyelles, State of Louisiana, filed its answer.

The defendant drainage district, through its attorneys of record, entered into a stipulation with the attorney of record for T. Jeff Feibleman, admitting that the proper jurisdictional facts appear, that said intervenor is a proper party and is the holder and owner for value of the seventeen (17) bonds described in his petition, that said bonds are past due and unpaid and consequently in default; and further stipulating 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. This stipulation was filed on September 8, 1941.

Thereafter, after various attempts at amicable settlement of the issues between them, and extensions of time granted by the Court in view of such attempts, the then parties to this 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, Louisiana, defendant, filed on October 20, 1944, a joint motion of all parties for a partial distribution of funds. On this joint motion a partial distribution of the funds was ordered by the Court to be made by defendant, of the sum of $215.27 on account of the principal of each of the 72 outstanding bonds of the issue sued on, and the sum of $750.00 as attorneys' fees was ordered paid to W. E. Couvillon and S. Allen Bordelon, Esqs., attorneys for defendant, jointly. It was ordered that the remaining sum of $1,248.82 be retained by the defendant drainage district, subject to the further orders of the Court; that the cause remain on the docket without prejudice to any claim asserted herein, or any defense made, save that proper credit be given...