Court Opinion

ID: 7201899
Source: CourtListenerOpinion
Date Created: 2022-07-24 17:09:10.496841+00
Date Added: 2024-06-11T16:16:32.960532
License: Public Domain

ON THE MERITS
The district judge found that at the date of the pretended transfer of the rice to Banta, the debts Broussard owed amounted in the aggregate to the sum of $2,200. Counsel for defendant say that if Broussard owed the Smardon note, his total liabilities were about $2,100. We do not see why his obligation represented by the Smardon note should be eliminated from the debts Broussard owed at that time, which show that he was in debt at about the amount fixed by the district judge.
Counsel for Banta cite C. C. 1985, which says:
“By being in insolvent circumstances is meant, that the whole property and credits are not equal in amount, at a fair appraisement, to the debts due by the party. And if he, who alleges the insolvency shows the amount of debts, it is incumbent on the other party to show property to an equal or greater amount.”
It was therefore incumbent upon Banta who had bought from Broussard, the alleged insolvent, to show that he had property at a fair appraisement, at least equal in amount to his debts.
At the time of the transfer Broussard was the owner of a McCormick Deering tractor, one Fordson tractor, one disc, one harrow, and the 164 sacks of rice in dispute. This machinery, it may be appropriate to remark, had been in use for some time. He also had an automobile, but this auto was in Texas where Broussard had removed. He said he paid cash for that auto. His own letters to Himel and Le Bourgeois show that he could not pay his debts, as also appears from the facts of the case, which make it impossible to believe that Broussard had acquired this auto for a cash consideration.
Banta says this McCormick tractor had been in use for two years, but fixes its value at $850, and upon which rested a chattel mortgage for $500. He placed no estimate on the Fordson tractor, disc and harrow. The only appraisement of the last-mentioned machinery we find in the record was that made for the sale under the seizure by Le Bourgeois. In the appraisement for the sale, the Fordson tractor is listed at $250, the harrow at $15, and the disc at $75. It also appears *408that at the sheriff’s sale under the attachment, the Fordson tractor, although offered at two-thirds of its appraised value, was not sold for lack of a bidder, and that the disc and harrow, which had been appraised at $90, were bought by plaintiff bank, seizing creditor, ior $60. The rice in contest was not worth on the market over $2.50 per sack, the total value for the 164 sacks being about $410. Counsel for defendant would also have us include in that valuation $1,000 or more in cash, which they contend Broussard had in his possession at the time. This, according to Banta, he was supposed to have from money realized from the sale of rice belonging to Banta. It was for the price of the rice which Broussard had sold that Banta had taken in payment the rice under seizure, if we are to believe him. In making his estimate of Broussard’s assets, Banta includes the value of the rice in contest and the $1,000 or more above mentioned and referred to in counsel’s brief. If Broussard gave the rice in part payment of his debt for Banta’s rice he had sold, the value of that lot of 164 sacks could not be figured upon in the calculation made in support of his' solvency. Including the rice seized as an asset, the tangible property belonging to Broussard egualed about $840, the amount which was found by the trial judge.
The court in its reasons for judgment says:
“Banta knew Broussard’s inability to pay his debts, and of his insolvency, at the time of the transfer.”
In addition to the facts to which, we have referred and to the foregoing statement of the court, there are letters in the record from Broussard which show that he was unable to pay his debts. There is no doubt that he was in a state of insolvency, which however, he denies in his testimony taken under commission.
Banta testifies that Broussard had sold his (Banta’s) rice for $2,703.70; that after paying expenses to gather the crop, and paying Barras, a helper, Broussard gave him a check for $850, leaving a balance of $1,121.45 due him by Broussard. It is in part payment of that amount that he says he took the rice in dispute, which had been milled at Conrad’s Mill in New Iberia. He says his settlement with Broussard was made at his home, which the record shows was in Jeanerette, La. According to Banta, he took 232 sacks in payment from Broussard at the mill, although the evidence shows that Broussard had only 164 or 169 sacks there; and, according to Banta’s evidence, this was all Broussard had received for his share after settling with Barras, who had assisted in harvesting the crop. Banta says he took the rice at $3 per sack, although it is shown that rice was not worth at the time over $2.50 a sack. The deal according to Banta, was effected at his home at Jeanerette. It does not appear that he had inspected that rice, and had seen to its quality before taking it at a price in excess of its market value, and from a debtor he claims had some $1,100 in cash at that time, and who was perfectly solvent. With all this pretended faith in the solvency and also integrity of his debtor, Banta says, however, in referring to Broussard:
“I wanted to get what was mine; he might not be able to ipay me.”
It 'is extremely doubtful that Broussard was in debt to Banta for the amount claimed by him in any sum whatsoever. The transaction seems to have been a pure simulation, which had been carried out to defraud plaintiff bank. If not a simu*409creditor, to the injury of his other creditors.
The proof shows that Broussard and Banta had been close associates in business for three years prior to the transfer in question. It also appears that while Broussard was sick in New Orleans, Ban-ta had obtained an extension of 30 days on the note sued upon, thus prolonging its maturity to November 1, 1927; and strange to say, just one day prior to the date of the pretended transfer on November 2, 1927. Broussard, according to Banta, had been given a free hand in selling the latter’s rice crop, and Banta, who had obtained an extension of time on Broussard’s rent note, was aware of a debt Broussard owed the International Harvester Company, from all of which, and other circumstances of the case unnecessary to mention, we must conclude that Banta knew of Broussard’s insolvency when he claims to have acquired the rice. Santa therefore obtained a preference from Broussard, known to him as being insolvent, which lays the contract for the transfer of the rice open to annulment. C.C. 1983; Lothrop vs. Goudeau, 142 La. 348, 76 So. 794; Grossman’s Sons vs. Chachere, 136 La. 671, 67 So. 545; Ventrilla vs. Tortorice, 160 La. 522, 107 So. 390; Swain vs. Kirkpatrick Lumber Co., 143 La. 30, 78 So. 140, 20 A. L. R. 665.
And even if Banta did not have positive knowledge that Broussard was insolvent, the circumstances are such that they cannot fail to produce the impression that he was aware of it, and this suffices to lay the contract open to annulment under article 1983, Civil Code; De Blanc vs. Martin, 2 Rob. 38; J. Grossman’s Sons vs. Chachere, 136 La. 666, 67 So. 545.
The judgment is therefore affirmed.
Por opinion on rehearing, see 10 La. App. 801.