Sullivan v. Ammons

• Decision Date: 08 February 1909
• Docket Number: 13,644
• Citation: 95 Miss. 196,48 So. 244
• Court: Mississippi Supreme Court
• Parties: WILLIAM C. SULLIVAN v. WILLIAM E. AMMONS

48 So. 244

95 Miss. 196

WILLIAM C. SULLIVAN v. WILLIAM E. AMMONS

No. 13,644

Supreme Court of Mississippi

February 8, 1909

FROM the circuit court of, second district, Tallahatchie county HON. SAMUEL C. COOK, Judge.

Ammons appellee, was plaintiff in the court below; Sullivan appellant, was defendant there. From a judgment in plaintiff's favor the defendant appealed to the supreme court. The facts are stated in the opinion of the court.

Judgment affirmed.

Boatner & May and R. L. Cannon, for appellant.

While it is true that the statute precluding recovery for failure to procure a privilege tax license was repealed by the Code of 1906, appellant relies on sec. 4 of said Code saving to him the benefit of existing rights and defenses, and on former decisions of this court, cited herein.

The non-payment of the privilege tax as alleged in defendant's plea No. 3, which were demurred to and by the court held bad on demurrer, constituted a defense, or bar, to any suit for the enforcement of plaintiff's claim for merchandise sold during such delinquency. This bar created by statute, Code 1892, § 3401, Laws 1904, p. 82, § 107, was absolute, and was not taken from defendant by the fact that Code 1906, in failing to re-enact the penal clause contained in said statutes thereby repealed it, even conceding for the sake of argument that the defense is not within the saving clause of § 4, Code 1906. Anding v. Levy, 57 Miss. 51; Decell v. Lewenthall, 57 Miss. 331.

All debts contracted to be paid to a creditor, engaged in a business requiring payment of a privilege tax during the time of his delinquency for such tax are void; and no transmutation in the form of renewal of such debts can save the bar of the statute. Puckett v. Fore, 77 Miss. 391, 27 So. 381; Code 1906, § 4, which is the same as Code 1892, § 4, expressly reserves the bar; Goodman v. Loan Association, 71 Miss. 310, 14 So. 146; Lemonious v. Mayer, 71 Miss. 514, 14 So. 33.

Mayes & Longstreet and A. H. Stephen, for appellee.

We submit that if this were an original question, and not obscured by earlier decisions of this court, the conclusion of his Honor below was correct, and that his judgment should be affirmed would be quite clear. We shall endeavor to show that those earlier decisions are distinguishable from this case, and that notwithstanding them, this case should be affirmed. In fact, the essential principle for which we contend, and which being recognized, leads to the affirmance of this case, was by necessary implication recognized and asserted by this court in the case of Insurance Company v. Bank, 73 Miss. 469, on page 478.

Let this court get the facts of the case, and its legal attitude, straight. This case does not arise under the Act of 1875, but under the new and amended statute which appears for the first time in the Code of 1880, and was continued through all the subsequent legislation until the Code of 1906. Also, there is no longer in force any statute which prohibits suit on a contract made in the absence of the lawful privilege tax license. That feature of the law was terminated in April, 1906, which was long before this suit was brought. Young v. Insurance Co., 91 Miss. 710, 45 So. 706. Also, as shown above, the note sued on was executed, and the debt novated at a time when so far as this record shows, the appellee was conducting his business lawfully, under the protection, and in the possession of, a privilege tax license.

Remembering these facts, this case we submit is clearly to be differentiated from any of those heretofore decided, except the case in 73 Miss. above cited, the clear principle of which supports our position.

Appellant relies, in his brief, on the cases of Anding v. Levy, 57 Miss. 51, and Decell v. Lewenthall, 57 Miss. 331. But those cases are not controlling, for two reasons: first, the statute is different, and secondly, the notes sued on in this case were not executed during that period of time during which the merchant had failed to pay his privilege tax.

The two cases in 57 Miss. and some like cases, arose under the Act of 1875, which by its terms made all contracts absolutely void.

Shortly after these cases were decided, the Code of 1880 was enacted, which very materially changed the statute.

It is presumable that the change in the statute, such as it was, by Judge CAMPBELL, was intended to meet, and was intended in some way to modify, the severity of the previous decisions. If not, why change the terms of the law? Certainly, it was so intended.

The statute, as newly formed, provides that, "all contracts made with any person who shall violate this act, in reference to business carried on in disregard of this law, shall be null and void, so far only as such person may base any claim upon them, and no suit shall be maintainable in favor of such person or on any such contract. " (Section 489, Code 1880.)

This continued to be the form of the statute until that feature of it was repealed in April, 1906, by the Code, 1906, chapter on privilege. Under this new law we find a series of decisions made, which are much less stringent than the two cases in 57 Miss. relied on by appellant. Those decisions settle certain principles, the most conspicuous of which is that this matter is primarily one between the delinquent and the state, and not merely one between the delinquent and any private individual. Also, the statute was not intended so far to penalize the party omitting to pay his privilege tax as to deprive him of his property. For instance, the creditor of his debtor cannot assail a conveyance of property made to the delinquent creditor himself, in payment of a debt in such attitude, on the ground that it was a voluntary conveyance. The following cases are pertinent, and illustrate this modified line of holding. Pollard v. Pheonix Co., 63 Miss. 244; Peoples Bank v. Railroad Co., 65 Miss. 365, 4 So. 115; Crum v. Carrington, 72 Miss. 456, 16 So. 674; Sun Company v. Searles, 73 Miss. 469, 18 So. 544; Cunningham v. Atlanta Association, 73 Miss. 516, 19 So. 234.

It being true, as the foregoing cases settle that it is true, that the delinquent does not lose his right of property in his debt, but simply is debarred the right to sue for its recovery in the courts--very different consequences follow from that which would logically have followed, and which this court declared did follow, under the old act of 1875. The creditor held the debt; the debt was not void; it was void in so far as he should sue upon it, or base a claim upon it, manifestly meaning in the courts; in other words, it was not collectible by law.

It was substantially in the attitude of a debt barred by the statute of limitations, or a debt barred by a discharge in bankruptcy.

Now, therefore, we submit that if in such state of the case, and at a time when the creditor was no longer delinquent, but was conducting business under an adequate privilege license, his debtor should see proper to waive this defense which he might have interposed against the debt in the original form and novate the same, and execute a note therefor, this note can be sued on in the courts.

And especially can it be sued on when the suit is not brought, as in the instant case, until the statute itself which prohibits such suit, has been repealed.

The court will note the difference between the act of 1875, which made the debt absloutely void, and the Code provision of 1880, which converted the matter into one of remedy, and expressly provides that the contract should be void only so far as the party should base a claim thereon, meaning only so far as the party should undertake to collect the same in the courts.

There is a vast difference between a statute which makes a contract null and void and one which merely declares that it shall not be effectual for suit in the courts.

The distinction for which we contend was clearly recognized by this, court, as we have pointed out above in the case of Insurance Company v. Bank, 73 Miss. p. 478, 18 So. 931.

The opinion in the case of Puckett v. Fore, 77 Miss. 391, 27 So. 381, must be considered strictly in connection with the facts of that case.

Reading the opinion in the light of those facts and applying the opinion to the special course of dealing, adjudicated upon, the opinion is not incorrect, nor is it inconsistent with Insurance Co. v. Bank, 73 Miss. supra. It is simply inadequate not erroneous; and its inadequacy is not supplied by the report of the case.

There is nothing in the case of White v. Post, 91 Miss. 685, 45 So. 366, inconsistent with our position.

OPINION

WHITFIELD, C. J.

On December 29, 1906, Ammons, the appellee, filed two suits in the circuit court of Tallahatchie county against Sullivan the appellant, upon two certain promissory notes executed by Sullivan in favor of Ammons, one dated November 24, 1905, for $ 493.44, and one for $ 500, dated January 1, 1905, each bearing interest at 8 per cent. per annum until paid; the two suits having been afterwards consolidated. During the year 1904, and prior to and subsequent to that year, Ammons, the appellee, was engaged in the mercantile business at Sumner, Miss., and Sullivan was a planter. During the said period Ammons sold goods and merchandise to Sullivan on account for the purpose of supplying his plantation. The account having run for several years, and Sullivan not being able to pay said account, he executed the two said promissory notes in settlement of said account. The two notes having become past due and unpaid, Ammons brought suit as above stated, when Sullivan filed a plea of the general issue, also a special plea, setting up as a defense to the suit that during the year 1904, Ammons, plaintiff, was a merchant doing a general mercantile...