Kohlman v. Cochrane

On Rehearing.

PROVOSTY, J.

In 1875 the defendant, Mrs. Clara Cochrane, wife of David Siess, residing in Avoyelles parish, obtained a judgment of separation of property from her husband, owing to the embarrassed condition of his affairs.

From that time to 1896, inclusive, she did business with H. & C. Newman, of New Orleans, commission merchants, receiving advances from them and shipping her cotton to them.

In 1876 she acquired some real estate, partly cash and partly on credit; and for the credit part executed her four notes, each for $170, falling due in one, two, three, and four years, respectively, and bearing 8' per cent, interest from date. To secure same she gave a mortgage on the property. Also the vendor’s privilege was reserved.

In December, 1886, she bought, partly cash and partly on credit, other real estate, the same which her vendor had bought from her husband some months before. For the credit part she executed her two notes for $500 each, payable respectively on January 1, 1888 and 1889. To secure the payment of these notes she gave a mortgage on the property. Also the vendor’s privilege was reserved.

In 1890, with the authorization of her husband and of the judge, she executed a mortgage in favor of Henry Newman, of the firm of H. & C. Newman, for $2,633.58, for which she gave her notes. Both the certificate of the judge authorizing her and the act of mortgage recite that the mortgage is given for money borrowed by her to be used in paying certain debts secured by mortgage on her property.

In 1897, with the authorization of her husband and of the judge, she executed in favor of the same Henry Newman the mortgage notes upon which the present suit has been brought. In her petition to the judge asking for the authorization she said that Henry Newman holds against her the four mortgage notes of the mortgage of 1890, amounting to $1,825, and also another mortgage note of $1,100, executed by her in favor of H. & C. Newman in 1894; that said notes had been given for her debts, and that she desired to pay same, and for that purpose to execute a new mortgage. The judge’s certificate contains the usual recital of his having examined her separate and apart from her husband and ascertained from her answers that the statements of her petition *239were true. The mortgage was given for $4,473.54, represented by six notes, to the order of the maker and by her indorsed in blank, for the amounts, and falling due, as follows:

$473.54, due Jan. 1, 1899;
$000, due Jan. 1, 1900;
$800, due Jan. 1, 1901;
$900, due Jan. 1, 1902;
$900, due Jan. 1, 1903;
$800, due Jan. 1, 1904-

all bearing 8 per cent, interest from January 1, 1899.

The defendant paid the first and second of these notes, and paid all of the third except $229.33. She has paid nothing on the others.

The plaintiff, Kohlman, testified that he acquired this partially paid note and the unpaid notes from H. & O. Newman in good faith for valuable consideration. He gives the date of his acquisition, which would show that he acquired the two notes due January 1, 1903 and 1904, before maturity, out the others after maturity.

For answer, defendant pleads the general denial. She specially denies that the notes have ceased to belong to Henry Newman. She avers that they were given in renewal of a mortgage given by her to the said Henry Xowman in 1890 for a debt of her husband; that neither of said mortgages was executed by her of her own free will, but through the entreaties and threats of her husband and said Newman.

Defendant testified that the mortgage of ÍS90 was given for a judgment of $1,100, which a certain firm of Hambro & Sons had obtained against her husband, plus interest, and plus also $711 of interest which said Newman had paid on said judgment, and interest on this interest. What the balance of the mortgage was for, defendant does not say, but she says generally that it was for a debt of her husband.

She testified that the mortgage of 1898, now sued on, was given in renewal of the balance due on the mortgage of 1890, and for a debt of her own of $1,400. She testified further that all these mortgages were given by her by reason of threats made by said Newman and of the entreaties and threats of her husband, and not of her own free will.

Defendant’s husband testified that he acted as agent of his wife during the time she dealt with H. & O. Newman, and that she came out with money each year except the last, 1896.

Henry Newman, as a witness for defendant, testified that his firm did business with Mrs. Siess, beginning in 1875 until recently, and during that time occasionally lent money to David Siess individually; that the mortgage of 1890 was given to cover a then existing indebtedness, being a balance due after business dealings of about 15 years. He says that it is impossible for him to furnish the accounts of those years, because the records of his business for that time have been disposed of to junk dealers. That he does not recall that any obligation of David Siess was ever charged to his wife’s account.' That he made personal loans to David Siess, and still holds his notes for same.

The testimony of defendant that the mortgage of 1890 was given for a judgment against her husband does not harmonize very well with her declaration to the judge that she desired to borrow the money to liberate her property from incumbrances, and with her recital, to the same effect in the act of mortgage. Nor does it harmonize with the testimony of her witness Newman that the mortgage was given for a balance due in her business of many years with his firm, and that he does not recall that any debt of her husband was ever charged to her. Again, her statement with reference to the interest which was added to the face amount of the *241Il'ambro & Sons judgment in making up the amount of the mortgage of 1S90 does not accord with an agreement offered in evidence by herself, dated March, 18SS, reciting that all interest on said judgment up to date has been paid, and that an extension of time is granted for payment of the principal.

The learned judge a quo considered that defendant had proved that the mortgage of 1898 had been given for a debt of the husband, except as to the $1,400, which defendant acknowledged to have been her own debt. He thought, however, that defendant, having been authorized by the judge to execute the notes, was precluded from setting up equities as against a bona fide holder for value before maturity; and he found that one of the notes, that last maturing, had been acquired before due. For the amount of this note he gave plaintiff judgment, and dismissed his suit for the remainder.

We agree with our learned Brother on the two points that the equities are open to defendant as to the notes acquired after maturity, and that they are not as to those acquired before maturity. The defendant, having been authorized by the judge to contract, could bind herself as a feme sole, and therefore she is bound for the note or notes acquired before maturity as a feme sole would be in her place. But a feme sole could set up equities as against a holder who had acquired after maturity; and because defendant is a married woman and can contract as a feme sole is no reason why she should be in a worse position.

The case of Koechlin v. Thontke, 26 La. Ann. 737, to which we are referred by the learned counsel for defendant, in support of their contention that even as against a bona fide holder before maturity a married woman duly authorized by the judge can set up that her mortgage note was given for a debt of her husband, is not in point. The authorization of the judge in that case was informal and illegal on its face; it authorized the giving of a mortgage to secure an already existing debt, which is a thing the act of 1855, now articles 125, 126, and 127, Civ. Code, does not authorize, as has been repeatedly decided. Falconer v. Stapleton, 24 La. Ann. 89; Brooks v. Stewart, 26 La. Ann. 715; Conrad v. Le Blanc, 29 La. Ann. 125; Gibson v. Hitchcock, 37 La. Ann. 212, 333; Berwick v. Frere, 49 La. Ann. 229, 21 South. 692.

Decisions more nearly in point are those where it has been held that the lender of money to a married woman is protected by the certificate of the judge where he has made the loan in good faith believing it to be for the benefit of the wife. Reich v. Rosselin, 26 La. Ann. 418; O’Keefe v. Handy, Shff., 31 La. Ann. 832; Henry v. Gauthreaux, 32 La. Ann. 1107; Saufley v. Joubert, 51 La. Ann. 1048, 25 South. 934; Dougherty v. Ins. Co., 35 La. Ann. 629, and cases there cited.

Cases exactly in point are Miller v. Wisner, 22 La. Ann. 457; Locke v. Lafitte, etc., 28 La. Ann. 232; Taylor v. Boules, 28 La. Ann. 294.

We are not as well satisfied as our learned Brother was upon the facts of the case, especially in view of statements made by counsel on both sides in the course of the argument as to what they could prove if an opportunity were offered. We have therefore concluded to remand the case for trial on the facts.

We will add that, as a matter of course, the nature of a debt is not changed by its renewal, or by the renewal of the evidence of it, or of the securities given to secure it. So that, if the consideration of the mortgage of 1898 was given in renewal of preceding mortgages, the question will have to be whether these preceding mortgages were given for a debt of the husband.

It is therefore ordered, adjudged, and de*243creed that the judgment appealed from be set aside, and that his case be remanded for further trial.

NICHOLLS, J., concurs in the decree.