Court Opinion

ID: 9666859
Source: CourtListenerOpinion
Date Created: 2023-08-24 01:28:59.183237+00
Date Added: 2024-06-11T18:15:33.082264
License: Public Domain

McCALEB, Justice
(dissenting).
As I understand the opinion of the majority, it is to the effect that defendant corporation is estopped to deny the unauthorized borrowings of its president by reason of having acquiesced in them, and also that defendant corporation ratified these unauthorized acts by reaping the benefits flowing from them. I am not in accord with either of these findings.
It is well established that estoppels are not favored in law and will not be maintained except in clear cases. Selber Bros. v. Newstadt’s Shoe Stores, 203 La. 316, 14 So.2d 10; Rials v. Davis, 212 La. 161, 31 So.2d 726, and Arkansas Louisiana Gas Co. v. Thompson, 222 La. 868, 64 So.2d 202. It is also settled that an estoppel *899will not be maintained unless the person urging it has been misled to his injury or prejudice by the conduct of him who is sought to be estopped. State ex rel. Bass v. Mayor and Board of Aldermen, 204 La. 940, 16 So.2d 527; Liquidation of Canal Bank & Trust Co., 211 La. 803, 30 So.2d 841, and Janney v. Calmes, 212 La. 756, 33 So.2d 510.
The evidence in. the record does not indicate that plaintiff was ever misled by any conduct on the part of defendant corporation. As the head of a finance company, he must have been aware that Conley could not obligate the corporation without authority from the board of directors. He had no reason to suppose that such authority had been given, merely because Conley had effected three previous loans. No pattern or course of conduct1 had been established that would justify the belief that the board of directors had empowered Conley to borrow money for the corporation or that it had acquiesced in such loans.
In addition, there is ample evidence of the personal friendship and dealings between plaintiff and Conley to support a finding that the loan was believed by both to be personal to Conley and not an obligation of the corporation". Corroborative of this view is the fact that, subsequent to the making of the loan, Conley granted plaintiff a mortgage on Conley’s house in the amount-of $3,000 as collateral security for the loan and that, later, the home was sold and the $3,000 placed in escrow pending the outcome of this litigation.
Indeed, a reading of plaintiff’s testimony has convinced me that there is no equity in his case and, consequently, no ground for sustaining a plea of estoppel in his favor.
It is also clear to- me that there was no ratification of the loan. Although Conley destroyed the corporation’s books prior to his departure for parts unknown, the record discloses that he embezzled some $15,000 of the corporation’s funds shortly after depositing the borrowed money in the corporation’s account. In light of this, it is scarcely realistic to suppose that any benefit was derived by defendant from the loan.
I respectfully dissent.

. The three cases cited in the majority opinion to the effect that a corporation’s course of conduct in permitting an officer to do an act constitutes an acquiscence in such act and thus creates an estoppel can be distinguished from the instant case on their facts — besides, the course of conduct found to work an estoppel in each of those matters covered many years while in the instant case it involved a period of less than three months. Also, the case of City Savings Bank & Trust Company v. Shreveport Brick Co., 172 La. 471, 134 So. 397, is not apposite here since it concerned a so-called “one-man” corporation. In the case at bar, both Conley and Britt were active in the affairs of the corporation.