First Nat. Bank of Shreveport v. Crawford

426 So. 2d 1348, 1983 La. App. LEXIS 7659
CourtLouisiana Court of Appeal
DecidedJanuary 17, 1983
Docket15,129-CA
StatusPublished
Cited by2 cases

This text of 426 So. 2d 1348 (First Nat. Bank of Shreveport v. Crawford) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
First Nat. Bank of Shreveport v. Crawford, 426 So. 2d 1348, 1983 La. App. LEXIS 7659 (La. Ct. App. 1983).

Opinion

426 So.2d 1348 (1983)

The FIRST NATIONAL BANK OF SHREVEPORT, Plaintiff-Appellant,
v.
Ruth May CRAWFORD, Defendant-Appellee.

No. 15,129-CA.

Court of Appeal of Louisiana, Second Circuit.

January 17, 1983.

*1349 Blanchard, Walker, O'Quin & Roberts by J. Jay Caraway, Shreveport, for plaintiff-appellant.

Cook, Yancey, King & Calloway by James Robert Jeter, Shreveport, for defendant-appellee.

Before PRICE, SEXTON and NORRIS, JJ.

NORRIS, Judge.

The First National Bank of Shreveport, hereinafter referred to as the "Bank" appeals a judgment of the trial court dismissing its suit on a promissory note because of the failure of the Bank to amend its suit to join two other co-makers on the note in compliance with the trial court's earlier order sustaining an exception of non joinder of necessary parties filed by defendant, Ruth May Crawford.

On March 29, 1982, the Bank sued Ruth May Crawford for $2,053,007.68 together with interest and attorney's fees alleging that it was the holder of a promissory note executed by Mrs. Crawford, Maxey G. Howe, and Dena C. Howe, in the amount of $2,250,000 dated January 28, 1980, due on demand bearing 12% per annum interest and providing for an award of 10% attorney's fees on the total principal and interest due. The petition further alleges that the co-makers are solidary obligors under the terms of the note in question, a copy of which is attached and incorporated into the original petition; reserves all rights against the co-makers not made party defendants; and prays for recognition of its rights on a mortgage on immovable property executed contemporaneously with and securing the note.

Thereafter, defendant filed exceptions of prematurity, non joinder of necessary parties and vagueness, contending in connection with the exception of non joinder of necessary parties that the note sued upon constitutes a joint obligation thereby making Mr. and Mrs. Howe necessary parties to this suit.

At the hearing on the exceptions, an order granting relief under Chapter 11 of the United States Code in the United States Bankruptcy Court in proceedings entitled "In Re Maxey Gregg Howe and Dena Crawford Howe d/b/a Kickapoo Dairy Farm," dated February 19, 1982, was filed into evidence. Also filed into evidence was an "Order Authorizing Debtors in Possession" signed on the same date as the aforementioned "Order for Relief." The "Order Authorizing Debtors in Possession" authorizes the Howes to continue to possess and *1350 manage their property and to operate their business and contains an injunction and stay order. Other filings at the hearing on the exceptions show that the property on which the Howes operate their dairy business includes the property on which the Bank holds the mortgage. That property is owned in indivision by Mrs. Howe and her mother, Mrs. Crawford, title having passed to Mrs. Howe through the succession of her father, Robert Herman Crawford.

Only Mr. and Mrs. Howe were called to testify at the hearing on the exceptions. Mr. Howe testified that he operates a dairy business on land which includes the mortgaged tract, referred to during the hearing as the "Crawford Place," and that Chapter 11 proceedings were filed by the Howes with the intention of accomplishing a plan of reorganization for the business. He further testified that it was necessary to the success of the plan that he be allowed to operate the dairy farm on the Crawford Place. The testimony of Mr. Howe was confirmed by that of his wife. It was then stipulated that there are assets belonging to Mrs. Crawford which are not covered by the mortgage held by the Bank.

After considering the evidence, the trial court found no merit to the exceptions of vagueness and prematurity but sustained the exception of non joinder of necessary parties to this action. The Bank's counsel indicated he would amend the petition to add the Howes as party defendants, and the trial court allowed fifteen days for amendment of the original petition. However, the Bank thereafter filed a Motion to Reconsider in lieu of an Amended Petition and did not amend its original suit. Because the Bank failed to amend its original petition to join the Howes, the trial court granted Mrs. Crawford's Motion to Dismiss and signed a judgment dismissing the Bank's action without prejudice. It is from this judgment that the Bank appeals assigning the following error:

The trial court's ruling erroneously requires joinder of parties whose estates are exclusively within the jurisdiction of the federal bankruptcy court and whose interests cannot be affected by this suit which is directed solely against the appellee.

Additionally, the Bank asserts that the following issues are contained within this appeal:

(1) Are the Howes necessary parties to this action? [and]
(2) Does the jurisdiction of the bankruptcy court which automatically stays the institution of state court proceedings against the Howes prevent their joinder in this suit in accordance with La.C.C.P. Art. 642?

We answer both questions affirmatively and reverse and remand.

We initially note that although the petition alleges that Mrs. Crawford is a solidary obligor with Mr. and Mrs. Howe on the note being sued upon, that the copy of the note incorporated as a part of the petition was considered by the trial court in arriving at its determination that the Howes were necessary parties whose joinder was required. Additionally, it is noteworthy that counsel for the Bank concedes that the obligation is joint rather than solidary.

The note sued upon reads as follows:

*1351

In Johnson v. Jones-Journet, 320 So.2d 533 (La.1975), the court stated:

It is well settled that absent additional promissory language, the words "[we] promise to pay" in a note signed by co-makers are insufficient to constitute the express stipulation of liability in solido required by law. In such a case, the obligation is considered to be joint, and the liability of each co-maker is limited to his virile share of the obligation. [Footnote omitted.]

Therefore, construing the language of the court in Johnson v. Jones-Journet, supra, and applying it to the terminology of the note being sued upon with the admission of counsel for plaintiff in the instant case, we conclude that the obligation made the object of this suit is joint.

La.C.C.P. Art. 643 provides in pertinent part:

All joint obligees are necessary parties to an action to enforce a joint right, and all joint obligors are necessary parties to an action to enforce a joint obligation.

Therefore, the Howes, as joint obligors on the note, are necessary parties to this lawsuit.

La.C.C.P. Art. 642 provides:

Necessary parties to an action are those whose interests in the subject matter are separable and would not be directly affected by the judgment if they were not before the court, but whose joinder would be necessary for a complete adjudication of the controversy.
An adjudication of an action may be made even if all necessary parties are not joined therein, but when timely objection is made to the nonjoinder of a necessary party the court shall require his joinder if he is subject to its jurisdiction. [Emphasis added.]

Thus, when timely objection of non joinder of a necessary party is made, *1352 the court must require that party's joinder if he is subject to the jurisdiction of the trial court.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Head v. Erath General Hosp., Inc.
458 So. 2d 579 (Louisiana Court of Appeal, 1984)
First Nat. Bank of Shreveport v. Crawford
455 So. 2d 1209 (Louisiana Court of Appeal, 1984)

Cite This Page — Counsel Stack

Bluebook (online)
426 So. 2d 1348, 1983 La. App. LEXIS 7659, Counsel Stack Legal Research, https://law.counselstack.com/opinion/first-nat-bank-of-shreveport-v-crawford-lactapp-1983.