Hardy v. Whitney

480 So. 2d 766
CourtLouisiana Court of Appeal
DecidedOctober 1, 1985
Docket84-657
StatusPublished
Cited by5 cases

This text of 480 So. 2d 766 (Hardy v. Whitney) 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
Hardy v. Whitney, 480 So. 2d 766 (La. Ct. App. 1985).

Opinion

480 So.2d 766 (1985)

Robert G. HARDY, et ux., Plaintiffs-Appellees,
v.
Ronald L. WHITNEY, et al., Defendants-Appellants.

No. 84-657.

Court of Appeal of Louisiana, Third Circuit.

October 1, 1985.

*767 McNeely & Kidd, Hugh E. McNeely, St. Martinville, for defendants-appellants.

Paul J. Demahy, St. Martinville, for plaintiff-appellees.

Before STOKER, LABORDE and YELVERTON, JJ.

*768 YELVERTON, Judge.

This is an appeal from a judgment in favor of the makers of a promissory note, against parties who assumed that note, in a suit based on the contract of assumption. The defendants have appealed raising several issues. For reasons which we will hereafter explain, we find merit in only one issue raised, which has to do with whether defendants' responsibility is joint or in solido. Additionally, however, on our own motion (La.C.C.P. art. 927), we note that the plaintiffs, makers of the unpaid note sued upon, being neither the holders of the note nor having themselves paid the note, have established no basis for a judgment ordering the payment of the note to them by the defendants. We could dismiss the suit on an exception of no right of action. However, we find on the record that the facts alleged and proved, as well as the law, support the conclusion that the plaintiffs are entitled to a judgment of specific performance against the defendants, ordering defendants to pay the debt sued upon to the party to whom it is owed, Teche Bank & Trust Co. We do this under our broad powers to render any judgment which on the record is just, legal and proper, and we shall recast the judgment accordingly. This, together with an amendment recognizing that the obligation of each defendant is joint rather than in solido, are the only changes we will make in the judgment.

Plaintiffs are Robert and Peggy Hardy. Defendants are Ronald Whitney and B.R.P. Brokerage, Inc. The Hardys are the makers of the promissory note sued upon. In a contract between them and the defendants, the defendants assumed the payment of that note. The holder of that unpaid note is Teche Bank & Trust Co., not a party to this lawsuit.

The facts, in more detail, which gave rise to the issues presented by this appeal, began on August 19, 1979, when Robert and Peggy Hardy executed a collateral promissory note in the amount of $10,000, bearing interest at 12 percent per annum, made payable to Holder or Holders, secured by a collateral mortgage note on their home. They pledged this note and mortgage to Teche Bank & Trust Co. to secure a debt which they owed to the bank.

On January 5, 1981, the Hardys, who owned certain rights, title and interest in the businesses known as Cajun Supply and Cajun Rags, in St. Martinville, as well as some shares of stock in B.R.P. Brokerage, Inc., entered into a written contract conveying the business property and shares of stock to B.R.P. Brokerage, Inc. Part of the consideration for that sale, as expressed in the contract, read as follows:

"The assumption of the payment of a TEN THOUSAND AND NO/100 ($10,000.00) DOLLAR note made payable to Holder or Holders and signed by Robert G. Hardy and Peggy Hardy and which is secured by a mortgage of immovable property located on Aline Street in St. Martinville, Louisiana which is payable at the Teche Bank and Trust Co. by B.R.P. BROKERAGE, INC., and RONALD L. WHITNEY."

The enforcement of defendants' obligation of assumption created by the above quoted contractual language is the purpose of this lawsuit.

To continue with a narration of the facts as revealed by the record, it appears that on January 5, 1981, the date the above contract was entered into, there was in existence a hand note executed by Mr. Hardy, owed to the bank, in the approximate amount of $9,000.00. We say "approximate" because the record does not specify the hand note and its balance in existence on the exact date of the contract of assumption, but the record does show that just two months later, in March of 1981, a renewal of that hand note was executed for $9,035.67, payable at the rate of $222 a month for a year, followed by a "balloon" payment for the balance. Since that was a renewal note, we believe it is safe to assume (no one has contended otherwise) that there was a hand note of about this amount in existence on the date of the contract of assumption; it was established by the testimony that this hand note, whatever its *769 amount, was secured by the pledge of the collateral mortgage note for $10,000.

The president of Teche Bank & Trust Co. testified that the original hand note secured by the collateral note and mortgage was executed in 1979, and that it had been renewed four times, once on March 25, 1981 (this was the renewal for $9,035.67 just discussed); again on March 25, 1982, this renewal for $8,126.69; once more on October 15, 1982, for $7,690.28; and finally on April 15, 1983, for $7,619.53, the latter renewal calling for interest at 14 percent per annum until paid.

It is for this last hand note balance of $7,619.53 that the Hardys filed their present suit. The suit was filed on November 4, 1983, against Ronald Whitney and B.R.P. Brokerage, Inc., alleging that the holder of the note, Teche Bank & Trust Co., had demanded the full balance owed on the note, $7,619.53 plus interest, and that defendants had failed to pay the balance due in accordance with their obligation of assumption resulting from the January 5, 1981, contract. The plaintiffs prayed for judgment in their favor and against the defendants ordering the defendants to pay them the amount of the note plus interest. The trial court gave judgment to the Hardys against the defendants, in accordance with their prayer, for $7,619.53 plus 14 percent interest from April 15, 1983, the date of the latest hand note renewal.

Defendants raise three arguments on appeal. One is that the obligation assumed was limited to the August 29, 1979, collateral note for $10,000, and that, if plaintiffs are to prevail, they had to prove some indebtedness was owed on this collateral note. From this premise, defendants argue that there was no proof the collateral note was in arrears. They argue furthermore that it was improper to receive evidence regarding the subsequent hand notes, as these were not evidence of the obligation assumed by them.

The second issue raised by appellants concerns whether Ronald L. Whitney, individually, assumed the obligation explained in the above quoted portion of the contract.

The third issue is whether the trial court was correct in finding that the obligation between Whitney and B.R.P. Brokerage, Inc., for the payment of the note was a solidary one.

Addressing these issues, we have no hesitation agreeing with the trial court that the language of the contract of assumption, however inarticulate, can only be interpreted to mean that the defendants bound themselves to pay the balance due on the hand note given to the bank by the Hardys as of January 5, 1981, secured by the collateral note and mortgage described in the contract. The tenor of the contract permits only one reasonable construction, and that is that the defendants assumed whatever obligation was owed by the Hardys and secured by that collateral note up to its limit, but no higher. Clearly, had the Hardys owed hand notes in excess of the $10,000 collateral mortgage note at the time of their contract, the defendants could not be responsible for any amount in excess of their assumed amount of $10,000.

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Bluebook (online)
480 So. 2d 766, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hardy-v-whitney-lactapp-1985.