Court Opinion

ID: 9859095
Source: CourtListenerOpinion
Date Created: 2023-09-24 18:41:38.304147+00
Date Added: 2024-06-11T10:06:11.691777
License: Public Domain

REASONS FOR JUDGMENT
RODNEY BERNARD, JR., Bankruptcy Judge.
This matter is before the court on cross-motions for summary judgment filed by the plaintiff, Acadiana Bank [Bank] and defendant St. Landry Homestead Association [SLHA]. The complaint herein seeks a determination of the extent and priority of the mortgages held by the Bank and SLHA. The trustee was made a party to this action, and in answering, requests a determination that the real property in question be declared to be property of the estate and further that it be declared to be free and clear of all encumbrances. Since the two motions for summary judgment now before the court deal solely with prior*9ity as between the two creditors, without reference to the trustee’s contention, these motions will be treated as motions for partial summary judgment pursuant to Rule 56(d) of the Federal Rules of Civil Procedure. The validity of these liens as against the trustee will remain for future determination.

Facts

The parties to this motion do not dispute the facts in this case. On July 18, 1978, the Bank advanced $90,000.00 to the debtors in this case. Said loan was secured by a Collateral Mortgage-Real and Chattel, executed and subsequently recorded in the names of Herman J. Guillory and Bessie Berzas Guillory. That mortgage pledged two parcels of real estate. Tract One was titled in the name of Herman B. Guillory and Bessie Berzas Guillory. The record owner of Tract Two is Herman J Guillory and Bessie Berzas Guillory.
Subsequently, SLHA also advanced money to the debtors, taking and recording a mortgage on Tract One. Prior to taking that mortgage, SLHA requested and received a certificate of mortgages dated March 21, 1979 in the names of Herman B. Guillory and Bessie Berzas Guillory. That mortgage certificate did not reflect the Bank’s prior mortgage recorded in the name of Herman J. Guillory. That certificate was supplemented on March 28, 1979, and again the Bank’s prior mortgage was not shown.
It should be noted that when the Bank requested mortgage certificates in the name of Herman J., SLHA’s mortgage recorded in the name of Herman B. did appear.
Both the Bank and SLHA claim a first mortgage on Tract One. The Bank relies on La.Civ.Code Arts. 3329 and 3342 et. seq., and a long line of cases, declaring that if the mortgage is properly inscribed in the public record, it is effective against third parties. Essentially, the Bank’s position equates this situation with that of a mis-in-dexed mortgage. As far back as 1879, the Louisiana courts declared that the index to mortgages is not a part of the record itself. In Swan v. Vogel, 31 La.Ann. 38 (1879), the court declared that if there was enough information in the record to indicate the identity of the mortgage, i.e., to put a searcher on notice, the mortgage was effective as to third persons. The Bank asserts that the description of the property and the designation of the mortgagor as Herman Guillory married to Bessie Berzas was sufficient to put a searcher on notice, and the Bank should, therefore, prime the lien of SLHA.
SLHA, on the other hand, relies on a recent Louisiana Court of Appeals case. In First Financial Bank v. Johnson, 477 So.2d 1267 (4th Cir.1985), the court was faced with a situation almost identical to the one at bar. In that case, the court was called upon to decide whether a recorded mortgage executed in the name of “James J. Johnson” on real property titled in the name of “James Johnson” gave.subsequent creditors sufficient notice of the encumbrance. In that case, the court determined that to be effective as against third parties, a mortgage must be recorded in the name of the record owner of the mortgaged property. Thus, SLHA asserts that because the record owner of Tract One is Herman B., the mortgage in the name of Herman J. is not effective as against SLHA.
This court, for reasons of comity, feels compelled to follow the holding of the Johnson case as the latest expression of the law as enunciated by the Louisiana courts. This court does not agree with Johnson, and notes that that court cited no authority for a decision that seems contrary to the great weight of prior case authority. This court believes that the purpose of the recordation statutes is to provide subsequent creditors with notice and that a mortgage recorded under a nearly identical name, with the spouse’s name the same, should serve to put a searcher on notice of that mortgage. However, the Johnson court held to the contrary, and this court is bound by that decision.
By reason of the foregoing, this court finds that the mortgage of SLHA primes *10that of Acadiana Bank. A judgment consistent with this opinion will be signed upon submission.