Court Opinion

ID: 7195442
Source: CourtListenerOpinion
Date Created: 2022-07-24 17:02:07.833838+00
Date Added: 2024-06-11T16:16:19.015854
License: Public Domain

*252On Application for Rehearing.
Fenner, J.
We have attentively considered this application.
Whatever may be said as to the correctness of our interpretation of the decisions of the Supreme Court of the United States in the cases of Otis vs. Cullom and Cooke vs. United States, from which, however, we see no reason to depart, our decision in this case rests, upon germinal principles which are not, from any point of view,, within the grasp of those cases. They are based exclusively upon the law merchant.
We hold:
1. That the law merchant is only applicable in the State of Louisiana in so far as it has been embodied in, or is not in conflict with, the laws of the State; and that, while it has been long recognized as part of the law of the State, nothing prevents the State, in the-exercise of its legislative power, from abrogating, repealing or-modifying it, provided such legislation operates prospectively, and does not impair contract rights existing prior to, or at the date of, such legislation.
2. That the true meaning and effect of the constitutional provisions herein cited were to repeal and abrogate the law merchant-so far as it applied to the instruments in question, this judicial construction being not a new one, but resting on precedent decisions of this court incases entirely analogous to the instant one.
3. That the rights asserted by the defendants here all arose after the adoption of the constitutional provisions referred to and after the conditions which gave effect to those provisions had occurred; and, therefore, that those rights must be governed, not by the law merchant, but by the special laws thus enacted and interpreted by this court.
4. That thus the instruments in controversy lost the qualities of negotiable instruments and became subject to the laws of this State governing the rights and obligations of parties in the transfer of non-negotiable incorporeal rights.
5. That tjjiis court, being the creature of the Constitution, is bound to obey, to apply, and to enforce the mandates of that Constitution, in so far as they do not conflict with the paramount authority of the-Constitution of the United States.
6. That the Supreme Court of the United States has never ex*253’tended the principles suggested by even the broadest interpretation of Otis vs. Oullom and Oooke vs. United States to a case in any degree resembling the instant one, where the nullity of the instruments has been denounced by the Constitution of the State, and where the State, as constituted, not only can not be forced, but lacks the power to recognize or provide for them, and where the law merchant, so far as applicable to them, has been repealed.
7. If the instruments involved in Cooke vs. United States had belonged to a class which the Constitution of the United States had stricken with nullity, and had forbidden the government from paying or providing for, that case would have been more germane to the instant one, and the decision would have been different.
8. While Otis vs. Cullom contains general expressions of apparently broader import, the true and sufficient principle on which it rests is clearly stated, viz.: the purchaser got what he bought and intended to buy. We can discover no principle of law under which, in a contract of sale, intended by both parties to be the sale and purchase of valid bonds of the State of which there were many subject to no question, the vendor could discharge his obligation by delivering worthless similitudes of such valid bonds, and could throw upon the innocent purchaser the loss instead of looking to his •own transferrer to make him whole.
Rehearing refused.
Watkins, J., adheres to his dissenting opinion.