Court Opinion

ID: 7184560
Source: CourtListenerOpinion
Date Created: 2022-07-24 16:51:19.033936+00
Date Added: 2024-06-11T16:16:01.823529
License: Public Domain

Buchanan, J.
On the 10th of June, 1851, Peter Oonrey, Jr., being indebted to James Saul, the defendant, in the sum of ten thousand dollars, made his note, payable to the order of the latter, for that amount, with six per cent, interest from date; and, in case of default, interest at eight per cent, from demand.
On the same day, Hr. Oonrey delivered to defendant two hundred shares of the capital stock of the Mechanics’ and Traders’ Bank, and executed his power of attorney in the following terms:
“ Know all men by these presents, that I, the undersigned, for value received, do hereby irrevocably constitute and appoint James Saul, of New Orleans, to be my true and lawful attorney, for me, and in my name and behalf, to sell, assign, and transfer unto himself, or any other person or persons, two hundred shares in the capital stock of the Mechanics’ and Traders’ Bank of New Orleans; and further, one or more persons to substitute with like power. In witness whereof, I have hereunto set my hand, this 10th of June,, 1851.' Peter Oonrey, Jr.”
On the 20th of August, 1851, defendant, then being in New York, substituted, by letter, Edward Rawle, with special power to transfer to himself (defendant) the two hundred shares of .bank stock in question.
*224On the 29th of August, 1851, Edward Bawle, made a transfer of the said shares of stock on the transfer book of the bank, in the following words:
“ For value received, I do hereby assign unto James Saul, all my right, title and interest, in two hundred shares of the capital stock of the Mechanics’ and Traders’ Bank of New Orleans, on which has been paid fifty dollars on each, being the same as described by a certificate issued to me, numbered 1047, dated 19th of April, 1850, -which certificate is null and void.
Peter Conrey, by E. Rawle,
Of this transfer, witness, substituted by James Saul.
P. Arnouil. Edward Rawle.*”
Peter Oonrey, Jr., made a cession of his property to his creditors, on the 7th of November, 1851; and this suit was brought the syndic of his creditors, on the 9th of June, 1852, to make and annul the transfer of stock of the 29th of August preceding, as made in fraud of Gonrey's creditors and to their injury.
The petition alleges, that Oonrey was in insolvent circumstances on the 10th of June, 1851, as well as on the 29th August, 1851, and wholly unable to meet his liabilities, at both of those dates, to the knowledge of defendant. It concludes by a prayer, that the assignment and transfer of the aforesaid two hundred shares of stock, be declared null and void, and the same recognized and decreed to belong to petitioner, in his capacity of syn-dict, together with all dividends which have accrued, and may hereafter accrue thereon.
On the trial, it was admitted, that Oonrey, was solvent and rich, until the news reached New Orleans, about the 1st of July, 1851, of the protest of his bills on Samuel Jaudon, of New York.
It was also admitted, that when Saul wrote to Mr. Bawle, authorizing him to transfer the stock, which was on the 20th of August, 1851, he was aware of the insolvency of Jaudon and the protest of Oonrey.
It is proved, that the exchange operations of Oonrey with Jaudon, were very extensive — the amount of the drafts of the former on the latter being about half a million — and that Gonrey's credit was affected by the protest of those bills.
It is also proved, that Oonrey and Saul both married sisters of Jaudon ; and from this connection, it is argued, that defendant must have been intimately acquainted -with their affairs.
Whether Saul's knowledge of Jaudon's insolvency, necessarily implied a knowledge of ’Gonrey's insolvency at the date proved, or whether, in fact, the proof of Oonrey being under protest on the 29th of August. 1851, is tantamount to proof of his being insolvent at that date, in the sense of Article 1980 of the Code, are questions which it is deemed unnecessary to decide, inasmuch as we consider the assignment of the stock by Oonrey, represented ¡by Bawle to Saul, to be void for an entirely different reason.
There is no doubt of Saul’s being a lona fide creditor of Oonrey, to the amount of ten thousand dollars, on the 10th of June, 1851. That debt was represented by a promissory note of that date, and was made up of a note of •<$8,500 of the 9th of August, 1850, and of $1,500 paid by Saul to Oonrey, on the 10th of June, 1851. The note of $8,500 was itself a renewal of a note for a much larger amount ($12,000) given by Oonrey to Saul, for money lent, on the 1st’ of December, 1849.. The certificate for the two hundred shares of *225Mechanics’ Bank stock, had been deposited by Gonrey in Saul's hands, as far back as May, 1850, as collateral security of the first of those notes; and the notes of $8,500 and $10,000, were intended to' be secured by the said shares of stock. The certificate of said stock was placed in Mr. Saul’s hands, with that view. We have here a pledge of the stock made in good faith, to secure a bona fióle debt, at a time not suspicious, and by which no creditor was injured. The allegation of the petition that Gonrey was insolvent on the 10th of June, 1851, and that to the knowledge of Saul, is disproved by the evidence and even by the admission of the plaintiff.
Simultaneously with the pledge of the stock, the power of attorney already mentioned was given, purporting to be for value received and irrevocable. Those clauses sufficiently indicate the interest of Saul in the object of the mandate — the stock. That interest, as we have seen, was an interest of pledgee. As pledgee, he had no power to sell the object pledged, unless by virtue of a judicial order; and the power to him to do so, was a nullity, even between the parties. 0. 0., Art. 8132. It follows that the transfer, which was made of the stock, under this power, was also a nullity.
But the nullity of the assignment of the ownership of the stock, leaves defendant’s right as pledgee in full force. See Partee's Syndic v. Corning, 9 An. 539.
And as to any informality in the pledge, as for instance, the want of the act of pledge required by Article 3125 of the Code, it has been settled in the same case, that the syndic of the pledgor cannot disturb the pledge on any such ground, where the contract was made in good faith, and no creditor was injured thereby. In this case, the defendant had possession of the stock as a security for Gonrey’8 indebtedness to him, from a period antecedent to the existence of any debt upon Gonrey's schedule, which is in evidence.
It is therefore adjudged and decreed, that the judgment of the District Court be amended ; that the transfer of two hundred shares of Mechanics’ and Traders’ Bank stock from Peter Gonrey, Jr., represented by B. Pawle to defendant, on the 29th of August, 1851, be declared null and void; that defendant be recognized as pledgee of the said two hundred shares of stock, for the security of a debt of ten thousand dollars, with interest at six per cent, from the 10th of June, 1851; that the injunction herein issued, be perpetuated, so far as it prohibits the transfer of said stock by defendant, and dissolved so far as' it prohibits defendant from receiving the dividend or dividends upon the same ; that said dividend or dividends heretofore declared, be credited upon the debt due defendant, as aforesaid; that the stock be sold by the Sheriff, for cash, to pay the said debt; and the surplus of proceeds of sale, if any, to bo paid over to plaintiff. The costs of the District Court to be paid by defendant, and those of appeal by the appellee.