Case Name: John E. Hewett, B. F. Jenkins and John B. Williams, Sr., for the Use and Benefit of Creditors and Stockholders of the Traders Bank of Mansfield vs. T. J. Williams, Jr., and His Wife, Mrs. Florence P. Williams
Court: Louisiana Supreme Court
Jurisdiction: Louisiana
Decision Date: 1895-12-21
Citations: 48 La. Ann. 686
Docket Number: No. 11,978
Parties: John E. Hewett, B. F. Jenkins and John B. Williams, Sr., for the Use and Benefit of Creditors and Stockholders of the Traders Bank of Mansfield vs. T. J. Williams, Jr., and His Wife, Mrs. Florence P. Williams.
Judges: 
Reporter: Louisiana Annual Reports
Volume: 48
Pages: 686–711

Head Matter:
No. 11,978.
John E. Hewett, B. F. Jenkins and John B. Williams, Sr., for the Use and Benefit of Creditors and Stockholders of the Traders Bank of Mansfield vs. T. J. Williams, Jr., and His Wife, Mrs. Florence P. Williams.
THE PLEA 01? NO CAUSE 01? ACTION.
The personal liability arising out of the act of converting another’s property (or property on which he has a lien) can not be avoided and frustrated by the fact itself of the conversion.
KBS JUDICATA.
The judgment pleaded as res judicata declared that the dation could not take effect to the prejudice of the plaintiff’s debt before the court for adjudication; that is, the matured debt. The judgment could not deal -with the notes not matured and the privilege by which they were secured. A judgment on a plea of prematurity is no support for the plea of res judicata.
NOT A THIRD PERSON WITHOUT NOTICE.
The intervenor was informed of plaintiff’s privilege on the two notes sued on in the first suit and in the present suit, and therefore must have known of the existence of this claim before the proceeds of the cotton came into her hands. The intervenor was bound to discharge the debt out of the funds in her possession; failing to thus discharge it, she became personally responsible.
APPEAL from the Ninth Judicial District Court for the Parish of DeSoto. Land, J., ad hoc.
Lee & Liverman for Plaintiffs, Appellees.
J. F. Pierson and C. W. Elam for Mrs. Williams, Defendant, Appellant.
Argued and submitted December 21, 1895.
Opinion handed down March 9, 1896.

Opinion:
The opinion of the court was delivered by
Breaux, J.
The plaintiff sues the defendant, Mrs. Williams, for a debt contracted by her husband, to make a crop of cotton on his plantation.
The defendant pleads the exception of no cause of action, res judicata, and in her answer she pleads that in a former suit the proceeds of the cotton claimed here were delivered to her, and that neither the cotton or the proceeds are in her possession.
The judgment was pronounced against her, and she appeals.
The prior suit pleaded in defence was brought on notes, two of which had not matured at the time the suit was brought.
The following is our summary of facts:
Two of plaintiff's notes had not matured at the date that suit was brought by him, and one hundred and thirty-six bales of cotton were attached and sequestered. The defendant in that first suit released the. sequestration on a forthcoming bond. Although the property was released under that bond it remained seized under a writ of attachment plaintiff sued out at the same time that he obtained a writ of sequestration. Later the plaintiff obtained an order for the sale of the property pendente lite; the property was sold, and realized four thousand two hundred and eighty-six dollars and eight cents.
Mrs. Williams about this time intervened.
With reference to her averred rights the following is an extract from an admission of record binding upon all parties:
" That the evidence taken in suit 5038 showed that the suit was brought and the writ of sequestration obtained in that case by the plaintiff J. E. Hewitt during the forenoon of December 12, 1893, an'd before 12 o'clock M.; that the writ of sequestration was issued before noon, and sent to the sheriff of Red River parish, and that the dation en paiement was made at 3 o'clock in the afternoon of the same day, and that the delivery of the property in Red River parish was made between 5 and 6 o'clock p. m. on same day, December 12, 1893 *
" The evidence further showed that the writ of sequestration was served on T. J. Williams, Jr., on December 12, 1893, before the dation en paiement was signed."
In this condition Mrs. Williams intervened, asserting her dation en paiement embracing the cotton seized by plaintiff under his privilege for a debt not disputed, though as to a part not matured (the maturity however being near at hand), she received the proceeds of the cotton in question made with the aid of plaintiff's advances.
Taking up the attachment we see that it was dissolved by a judgment of the District Court. It was in matter ot this attachment that the intervenor furnished bond, and obtained possession of the property which had been previously sold under an order of court authorizing the sale of property attached. From the judgment no appeal was taken.
In the former suit, the suit in which the attachment was dissolved as just mentioned, judgment was pronounced in favor of Hewitt for the amount of his debt on the matured note with privilege on the cotton seized. The court dismissed his suit on the two unmatured notes, but maintained the sequestration to enable him to assert his privilege in a new suit on the two notes at their maturity1. The District Court in this judgment maintained the dation en paiement by T. J. Williams to his wife.
On the appeal taken from this judgment this court maintained the .judgment in Hewitt's favor for the debt due and his privilege on the cotton; affirmed the dismissal as to the notes not due; set aside the reservation continuing in force the sequestration to await the second suit; and as to the dation en paiement, this court held that Mrs. Williams took the property subject to the privilege in favor of Hewitt, and recognized her right to payment out of the proceeds of the cotton, to the amount of her matured debt. J. E. Hewitt vs. T. J. Williams, Mrs. F. P. Williams, Intervenor, 47 An. 742.
The present suit is for the privileged debt of Hewitt, not matured when the first suit was brought, and presents the issue whether Mrs. Williams, under her dation en paiement, holds the proceeds against Hewitt despite his privilege resting on the cotton and the suit in which it was claimed at the time she obtained the proceeds by furnishing a forthcoming bond.
THE PLEA OF NO CAUSE OP ACTION.
Tins plea, as we interpret the pleadings and appreciate the argument, rests on the theory that the suit is hypothecary or in revendication of the cotton or its proceeds and that, therefore, it must be directed against the property, there being, it is urged, no personal liability of Mrs. Williams. (The cotton having béen •disposed of and the proceeds no longer in her possession she avers.)
If the liability alleged by plaintiff is answered by intervenor's use of the proceeds, and her defence is thereby established, it could have been supplied by her at any moment after she received the proceeds, by disposing of them, although such was not the condition of the order under which she was permitted to bond and take possession.
If such be the case, if, after disposing of the proceeds, she was no longer responsible for them, practically the liability never existed. There is, it strikes us, an error here.
The personal liability arising out of the act of converting another's property (or the property on which he had a lien) can not by the fact itself of the conversion or the disappearance of the converted property be defeated. This is not the hypothecary nor the action in revendication to be paid and satisfied by Mrs. Williams out of the funds; or by causing the disappearance of the cotton from which the proceeds were derived. The question is one of personal liabil ity for applying property to her own use, although she knew that it was subject to plaintiff's privilege, and that he was attempting to-enforce that privilege at the time she received the proceeds representing the property.
THE PLEA RES JUDICATA.
If it has been decided that a dation enpaiement by the husband to the wife frees the property from all liens then existing, made at the-time and under the circumstances before stated (the service of the suit had already been made on the husband at the moment of the dation), such final judgment becomes binding, if not as authority, at-least as conclusive between the parties.
Let us see if this was this court's action.
The res judicata relied upon is the first judgment maintaining the-dation en paiement in which the exception of prematurity was maintained on the notes sued upon in this case.
The District Court, in view of the hardship upon the privileged creditor, who would be made to lose because his debt was not due at the moment he instituted suit, retained the sequestration in force-until he could bring his new suit at the maturity of his notes. This court, on the appeal from that judgment, maintained the dismissal, but reserved the reservation and dismissed the sequestration.
The notes now sued upon passed out of consideration. As to these notes there could be no adjudication, save that of dismissal, but the judgment in that case decreed that the dation in question could not-take effect to the prejudice of plaintiff's debt, that is the matured debt. The court distinctly says that a dation, though permitted in any condition of the husband's affairs, can not defeat existing liens on his property, and if the notes now sued on had been due and owing the judgment would have included the amount they represent, and this controversy never would have arisen. The defence of res judicata is met by the fact that the court could not pass upon the liability arising on the unmatured notes. It is asserted that Hewitt, might have issued another writ of sequestration after the judgment, of dismissal. It is also asserted that- he might have filed a supplemental petition in the pending suit when the notes matured.
After the first suit, brought on notes matured and unmatured,, there was no occasion for a sequestration. The object of the sequestration is to seize the property on which the privilege rests. The cotton was taken from the custody of the court under a forthcoming-bond. If Hewitt had any right at all it was against the intervenor-who had received the property subject to the privilege.
In the recent case of State ex rel. Gondran vs. Judge, 48 An., we held that the intervenor bonding can be made liable on the bond,, although a dismissal had been entered; in other words, that the forthcoming bond, even as to third persons, has relation to the debt the writ enforces.
As to the supplemental petition, it would necessarily have changed the issues set forth in the original petition. It necessarily would have given in that case rise to the issue of personal liability of Mrs. Williams, an issue in reality different from that presented in the first, suit. Hewitt was under no obligation to assert this demand, by supplemental petition, as it was different, as we have just stated, from the issues it originally presented.
The general rule that the litigant must allege all his grounds for or against the relief he asks can not, we think, in reason and under the authorities, be extended to a right not susceptible of enforcement when he brings his suit, when it is excluded from cognizance by the express terms of the judgment that it is claimed binds him, and when the demand is necessarily entirely different from his cause.of action in the suit, the judgment in which is pleaded as res judieata.
It is elementary; the judgment on an exception of prematurity-will not sustain the plea of res judicata.
NOT A THIRD PERSON WITHOUT NOTICE.
• We are not impressed by the proposition that the wife was a third possessor in possession of the hypothecated property.
At the moment that the property was transferred to her she had knowledge or it must be presumed that she had knowledge of the privilege; the community had not been dissolved; it was dissolved some time afterward. She was a member of the community; and a possible beneficiary from the proceeds of crops made upon property of the community, of which she became the owner as we have-stated.
She can not, by intervention and bonding, gain an advantage to the extent of defeating one who had aided, by advances, in making the crop.
In the first ease the court held that the privilege for the matured privileged debt did follow the property in the hands of Mrs. Williams.
We recur to these proceedings and recall the views expressed by the members of the court.
The opinion of the Chief Justice on the refusal of the rehearing was that the case required no determination of the general question presented on the application.
Mr. Justice Miller expressed the opinion that the good faith of the purchaser of property, subject to the privilege, was the important test of his right to hold the property.
Mr. Justice Watkins was of the opinion the privilege of Hewitt was cut off by the elation en paiement. J. F. Hewitt vs. T. J. Williams, Mrs. F. P. Williams, Intervenor, 47 An. 742, 752, 753, 764.
Oan good faith here be successfully invoked?
The husband, in the first suit, succeeded in defeating a portion of the claim on the matured notes. Pendente lite, the wife intervenes, and owing to the successful defence of prematurity and her forthcoming bond she was enabled to receive and apply to her uses the proceeds of the property subject to the lien of the husband's creditor. If knowledge or the presumed knowledge is a controlling •element in the subject of good faith, the record discloses that element.
The jurisprudence of this State maintains that the insolvency of the husband is no impediment to the transfer to pay her claims. 'The wife is favored over other creditors, it has always been held: Rut it would be carrying the principle beyond all limits heretofore declared to hold that a dation en paiement entitles her to receive his property to the prejudice of his creditors with privilege on property on which they are seeking to enforce the claim at the very moment of the adjudication.
If intervenor's demand should be granted, at one moment she would have been interested in the crop represented by her husband, as head and master of the community, and the next moment she would have been a third person holding the property through the legal proceedings of the court, under a judgment in which it was decreed that the claim was secured by privilege.
There was here an implied trust in favor of the creditor bearing upon the property. Story on Equity Jurisprudence. There is a decision in point pronounced by the Supreme Court of the United States—Ellet vs. Butte et al. The factor had, in payment of his; debt, received and applied the crop he knew to be pledged for the-rent of the plantation and on the suit of the lessor. It was held-that the factor was liable to the lessor for the proceeds of the crop.
Our own decisions are not less instructive upon the subject, notably Fetter et al. vs. Field et al., 1 An. 80; E. R. Cory vs. Allen W. Eddins, 13 An. 443; Bres & O'Brien vs. S. C. & J. A. Cowan, R. W. Faulk, Intervenor, 22 An. 438.
If in these cases the lien prevailed against those who had given value for the property and were in possession, a fortiori should it-prevail against the wife who, with knowledge, has taken the property subject to the lien of the husband's creditor.
The privilege of Hewitt was not defeated by the dation. Her-liability rests upon the fact that, aware of his right, she received- and applied the proceeds of the property.
The judgment appealed from is therefore affirmed.