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U.S. Supreme Court

Fortier v. New Orleans Nat'l Bank, 112 U.S. 439 (1884)

Fortier v. New Orleans National Bank

Argued November 17, 1884

Decided December 1, 1884

112 U.S. 439


A bill was brought in the name of A. B. "in his capacity as President of the N. O. National Bank." Throughout the pleadings and all proceedings below it was treated as the suit of the bank. After appeal, it was assigned for error that it was the suit of A. B., and, as A. B. and the defendant were citizens of the same state, that this Court was without jurisdiction. Held that the defendant was bound by the construction put upon the bill below, and that the objection to jurisdiction was too late. chanrobles.com-redchanrobles.com-red

Page 112 U. S. 440

In Louisiana, the certificate of a judge under article 127 of the Code, that he has examined a married woman apart from her husband touching a proposed borrowing of money by her, and that he is satisfied that the proposed debt is not to be contracted for her husband's debt or for his separate advantage, or for the benefit of his separate estate, or for the community, is not conclusive, but casts on the wife the burden of proving that the money borrowed did not inure to her benefit.

A national bank may loan on security of a mortgage if not objected to by the United States. National Bank v. Matthews, 98 U. S. 621, and National Bank v. Whitney, 103 U. S. 99, affirmed. .

These are cross-appeals from a decree in equity in a cause brought by

"Albert Baldwin, in his capacity of president of the New Orleans National Bank, a corporation organized under the National Banking Law, against Celestine Louise Fortier,"

who was a married woman, the wife of Polycarpe Fortier. The purpose of the suit was to enforce the collection of a note "drawn," as the bill avers,

"by the said Celestine Louise Fortier to her own order, and by her endorsed with the authorization of her said husband, dated at New Orleans, March 16, 1877, payable one year after date, bearing interest at eight percent per annum from maturity until paid, for ten thousand dollars."

Leon Godchaux was the payee of the note, who, after its maturity, and but a short time before the suit was brought, transferred it to the New Orleans National Bank. The note was secured by a mortgage, executed by Mrs. Fortier, on three squares and six lots of ground in the City of New Orleans, which were her separate property. The bill by which the suit was commenced prayed for an order of seizure and sale of the mortgaged premises, as provided by the Code of Practice of Louisiana.

The mortgage was in the ordinary form of mortgages in Louisiana, and was executed in the usual manner before a notary public and competent witnesses. Appended to it was the following certificate:

"THE STATE OF LOUISIANA, Parish of Orleans, City of New Orleans"

"Fourth District Court for the Parish of Orleans"

"I, W. T. Houston, Judge of the Fourth District Court for

Page 112 U. S. 441

the Parish of Orleans, do hereby certify that on this 14th day of March, 1877, personally came and appeared before me at chambers, in the City of New Orleans, Mrs. Celestine Louise Laboranche, of lawful age, the wife of Polycarpe Fortier, of this city, and by virtue of article 127 of the Revised Civil Code of Louisiana, I did then and there examine the said Mrs. P. Fortier, separate and apart from her said husband, and she stated that she appeared before me for the purpose of obtaining the certificate specified in said article to borrow the sum of ten thousand dollars for her separate benefit and advantage by mortgaging her separate property."

"I do further certify that then and there I examined her touching the object for which the said sum of money was to be borrowed, and that I have by her declaration, made on oath, ascertained to my satisfaction that the sum of ten thousand dollars, which the said Mrs. P. Fortier desires to borrow, is not for her husband's debts nor for his separate advantage or the benefit of his separate estate or for the community, but that the same is solely for her separate advantage, and I therefore give and sign this certificate in pursuance of said article, giving my sanction and authority to said Mrs. P. Fortier, with the authorization of her husband, to hypothecate or mortgage her separate property for the purpose of borrowing the said sum of ten thousand dollars."

"Witness my hand and the seal of said court, this 14th day of March, 1877."

"W. T. HOUSTON, Judge"

A writ of seizure and sale having issued as prayed for in the bill, Mrs. Fortier filed her plea and a cross-bill. In the latter, she prayed for an injunction to restrain the seizure and sale of the mortgaged premises. The grounds upon which she based her defense to the original bill, and the relief prayed by her cross-bill, were as follows:

Admitting that at and before the date of the note and mortgage, she was separated in property from her husband, Polycarpe Fortier, she averred that she was possessed in her own right, as of a separate estate, of the property described in the mortgage; that the consideration of the note chanrobles.com-redchanrobles.com-red

Page 112 U. S. 442

sued on and secured by the mortgage was in part money lent to her husband by Godchaux, the payee, and in part the payment and satisfaction of a debt due from her husband to Godchaux.

To show that Godchaux knew that the money was not borrowed for the separate benefit of Mrs. Fortier, the cross-bill further averred that before the execution of the mortgage by her, it was agreed between her husband and Godchaux that the loan should be secured by a mortgage on her husband's property, but the titles not proving satisfactory to Godchaux, it was agreed between him and her husband that the mortgage to secure the loan should be placed on her separate property and that it should be transferred to the property of her husband when his titles were perfected. For the reasons stated, it was averred that the note and mortgage sued on were not binding on her property

There was an answer and demurrer to the cross-bill. The answer denied that the note sued on was given for any other purpose than that expressed in the certificate of the judge appended to the mortgage, and averred that the money raised on the note was all paid to Mrs. Fortier, except the discount, amounting to $1,025, and the sum of $1,200, which was, by her direction, handed to the notary to pay taxes due on the mortgaged premises.

The demurrer applied to all those averments of the cross-bill "tending to show that the said note, and mortgage granted by her," Mrs. Fortier,

"to secure the same were not executed for her own use and benefit, in opposition to her sworn declarations made on her examination by the judge of the Fourth district court, and the certificate of the said judge to that effect, and to all those averments in regard to the application made of the money lent by said Godchaux on the faith of said mortgage."

It was shown by the evidence that the mortgage and note were executed in the office of the notary; that Mr. and Mrs. Fortier and Godchaux, the payee of the note and the mortgagee, were present; that upon the execution and delivery of the papers, Godchaux retained from the $10,000, for which the note was given, first, the discount of ten percent on the face of chanrobles.com-redchanrobles.com-red

Page 112 U. S. 443

the note, amounting to $1,025, and second, the amount of a debt due from Mr. Fortier to him, being the sum of $1,800; that he gave his check to the notary for $1,200, to be applied to the discharge of taxes, etc., which were a lien on the mortgaged premises, and that he paid the residue of the $10,000 by handing to Mrs. Fortier his check on the Union National Bank for $5,975, payable to her order. It was further shown that after Mrs. Fortier received the check, it was deposited by Mr. Fortier, with her endorsement, to his own credit in the Louisiana National Bank, and the deposit was drawn out from time to time thereafter on his checks. The proceeds of the check for $1,200 handed to the notary were applied, after deducting the fees of the notary, to the payment of the taxes, interest, and costs, which were a lien on the mortgaged premises.

Robert Duque, a witness for the defendant, who appeared to be the friend and legal adviser of Mr. Fortier, the husband, testified that the latter, before the execution of the note and mortgage in suit, proposed to Godchaux to borrow of him $10,000 and to secure the same by a mortgage on the Fort Leon Plantation, of which he was the owner; that Godchaux declined to make the loan on the security offered on account of some defect in the title, and that the loan was afterwards made on the security of the mortgage in suit, with the agreement between Mr. Fortier and Godchaux that when the former perfected his title to the Fort Leon plantation, the mortgage should be transferred to it, and the property of Mrs. Fortier released therefrom.

The testimony of Duque on these points was directly and unequivocally contradicted by the deposition of Godchaux.

Godchaux also testified that, before the loan was made to Mrs. Fortier, he went to see the property which was afterwards mortgaged; that he was shown over it by Mrs. Fortier, who told him she wanted to borrow the money to improve the property and pay off the taxes due upon it.

This testimony of Godchaux in reference to his inspection of the property and the statements of Mrs. Fortier was not directly contradicted by her, although she was examined as a chanrobles.com-redchanrobles.com-red

Page 112 U. S. 444

witness in the case, nor was she questioned by her counsel in reference thereto. She testified that she received no money from Godchaux on the loan made by him, and that she did not receive any money on his check, which she admitted was endorsed by her, and that none of the money loaned was used for her separate benefit.

Upon final hearing, the circuit court rendered a decree for the complainant in the original bill for $7,860, with interest thereon from March 16, 1878, and five percent attorney's fees, having deducted from the amount appearing to be due upon the note of Mrs. Fortier the sum of $2,140, that sum being the amount retained by Godchaux out of the proceeds of the note of Mrs. Fortier for the debt due him by Mr. Fortier, with the interest, etc. The court dismissed the cross-bill with costs. Both parties appealed.


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