Court Opinion

ID: 7172918
Source: CourtListenerOpinion
Date Created: 2022-07-24 16:28:19.07839+00
Date Added: 2024-06-11T16:15:47.675777
License: Public Domain

On Rehearing.
O’NIELL, J.
This is a suit on three promissory notes, signed by the defendants, and made payable to the order of Pruiett, Day & Sniggs, a law firm in Oklahoma. The notes were acquired by plaintiff, before their maturity, from Moman Pruiett, the senior member of the firm,-who pledged the notes as collateral security for a loan made by the bank to him individually. Pruiett, at the time of the transaction, indorsed the notes thus:
“Pay to the order of Wilkin-Hale State Bank. [Signed] Pruiett, Day & Sniggs, By Moman Pruiett.”
The defendants say that they paid the amount of the notes to the payee, Pruiett, Day & Sniggs, before the notes were due, and - that the indorsement and transfer of the notes by Pruiett to the bank' was not authorized by his firm, was fraudulent, and did not convey title. On those issues the case was tried by a jury, and a verdict and judgment were rendered in favor of the plaintiff. On appeal to the Court of Appeal for the Parish of Orleans, the judgment was affirmed. On review by the .Supreme Court, the judgment of the Court of Appeal was set aside, and the case was remanded to that court for further proceedings not inconsistent with this court’s opinion. The reason for .remanding the case was that the Court of Appeal had based its decision upon the testimony of three nonresidents, whose depositions had been taken under commission, and were in the record, but had not been introduced in evidence. See Wilkin-Hale State Bank v. Tucker et al., 148 La. 980, 88 South. 239. The depositions referred to were those of the three members of the firm Pruiett, Day & Sniggs, testifying on the question of Pruiett’s authority to indorse and negotiate the notes in the firm’s' name. When the case was resubmitted to the Court of Appeal, that court rendered a decree remanding the case to the civil district court, to receive evidence on the question of Pruiett’s authority to indorse and negotiate the notes in the firm’s name. A rehearing was gi-anted by the Court of Appeal, and a judgment was then *53rendered affirming the judgment of the civil district court, without regard for thb depositions of Pruiett, Day or Sniggs, which had not been offered in evidence. The case was then brought here for review at the instance of the defendants.
In our original opinion in the present proceeding we found that the circumstances under which the bank had acquired the notes, with knowledge on the part of the bank officials that the loan was for the personal benefit of Pruiett, did away with whatever presumption the law might have established of Pruiett’s authority to indorse and negotiate the notes. We had in mind, particularly, the fact that Pruiett had not pretended to be the owner of the notes, and had not indorsed them individually, when he negotiated them for his individual benefit, to the knowledge of the bank’s officials. ■
[1, 2] Having reconsidered the matter, we have concluded to withdraw our original opinion in the present proceeding, and dispose of the case as the Court of Appeal first thought it ought to be disposed of; that is, by remanding it to the civil district court for further evidence on the question of Pruiett’s authority to indorse and negotiate the notes in the name of his firm. Our opinion is that the plaintiff is not entitled to a judgment for the amount of the notes, without proof that Pruiett, who negotiated the notes for his own account, was authorized to indorse them for the payee firm. On the other hand, without affirmative evidence that Pruiett did not have such authority, the only judgment that we might now render against the plaintiff would be a judgment of nonsuit. Article 906 of the Code of Practice provides that, under these circumstances, where, because of a failure of one of the parties to produce the necessary evidence, the appellate court cannot render a definitive judgment, the case may be remanded to the trial court with appropriate instructions regarding the evidence omitted. That disposition. of the case is preferable to a judgment of nonsuit, in that it will perhaps avoid another suit on the notes.
The judgment of the' civil district court and the judgment affirming it by the Court of Appeal are now annulled, and it is ordered that this case be remanded to the civil district court to receive evidence on the question whether Momon Pruiett had authority to indorse and negotiate the notes in his firm’s name, and for a new trial on that issue. The plaintiff bank is to pay the costs of this court in the present proceeding; the question as to who shall pay other costs depends upon the final judgment.