Tatum v. Acadian Production Corporation

35 F. Supp. 40, 1940 U.S. Dist. LEXIS 2459
CourtDistrict Court, E.D. Louisiana
DecidedSeptember 28, 1940
Docket6223
StatusPublished
Cited by16 cases

This text of 35 F. Supp. 40 (Tatum v. Acadian Production Corporation) is published on Counsel Stack Legal Research, covering District Court, E.D. Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Tatum v. Acadian Production Corporation, 35 F. Supp. 40, 1940 U.S. Dist. LEXIS 2459 (E.D. La. 1940).

Opinion

*44 CAILLOUET, District Judge.

This matter is before the Court on the motions of Acadian Production Corporation of Louisiana:

1. To dismiss the action because, so mover contends,

(a) There is failure to state a claim upon which relief can be granted;

(b) The claims alleged by the petitioners for mover’s involuntary bankruptcy can not be made the basis for such involuntary proceedings;

(c) The Court is without jurisdiction of the subject-matter, inasmuch as there is pending in the United States District Court of the Western District of Louisiana, a certain action seeking the appointment of a receiver to administer a mineral lease, in connection wherewith arose the claims of the four complaining creditors herein, and because the amount actually in controversy is less than $500.00, exclusive of interest and costs.

2. To have said complaining creditors aver with definiteness or particularity the various and sundry matters referred to in said motion under captions (4) a. b. c. d. e. f. g. h. i. j. k., and to require said complaining creditors to produce and attach to their petition, certified copies, respectively, of the several written instruments referred to in said captions (4) i. j. k. and Z.

3. To have stricken from the complaining creditors’ petition, as impertinent, irrelevant and immaterial, each and every allegation contained in Articles 4, 6, 8, 9, 10 and 12 thereof.

Subsequent to the filing of the said motions, the complaining creditors, by leave of the Court, twice amended their original petition. The first time, it was simply to delete, in article or paragraph VI, the words “are informed, believe, and therefore, in good faith”, so as to make the opening paragraph read, “That petitioners aver that the said Acadian Production Corporation of Louisiana, etc.”, instead of “That petitioners are informed, believe and therefore, in good faith aver, etc.”

The second time, it was for the purpose of adding to article or paragraph I the following sentence: “That said Acadian Production Corporation of Louisiana is organized under the laws of the State of Louisiana and is presently principally engaged in the production and development of oil, gas and mineral leases, and/or in the purchase, sale or hypothecation in any manner of oil, gas or mineral leases”.

By stipulation filed in the record subsequent to the hearing had of said motions, both of said amended pleadings, which had not been served upon the mover at the time of the Court hearing, are now to be considered and disposed of and by authority of said stipulation there has been filed and included in the record, two offerings by the complaining creditors, marked “Plaintiff 1” and “Plaintiff 2”; it being further stipulated that these exhibits are to be viewed by the Court as if they had actually been offered in evidence on the trial of the motions, but there is reserved to the mover any and all rights which it may have under the aforementioned motion to strike, as well as the right to object to the introduction of the said documents in evidence if and when the cause comes to trial on the merits, and to then and there adduce all competent evidence relating to the circumstances surrounding the execution and delivery of the said two mentioned instruments.

The General Order in Bankruptcy No. 37, 11 U.S.C.A. following section 53, 59 S.Ct. clxxxiv, provides that the Rules of Civil Procedure, 28 U.S.C.A. following section 723c, so far as they are not inconsistent with the Bankruptcy Act or with the General Orders of January 16, 1939, shall be followed “as nearly as may be”, etc., and the motion for a bill of particulars and the motion to strike are warranted, it may be assumed as mover’s counsel contend, under Rule 12 (e) and (f). So were the two permitted amendments of the petition, under Rule 15.

Mover’s counsel submit that under (a) and (b) of the motion to dismiss, the grounds for dismissal are:

1. A partnership exists between the mover, Acadian Production Corporation of Louisiana, and Iberia Petroleum, and the petitioning creditors’ claims are the debts of that partnership.

2. Said asserted partnership is an ordinary or limited partnership.

3. Acadian Production Corporation of Louisiana is a limited partner, and there is no “general” partner in the claimed partnership.

4. Because there is no “general” partner, the Court in this case has no authority to adjudge in bankruptcy under Section 5, Subdivision a, 11 U.S.C.A. § 23, sub. a, nor *45 has it authority to adjudge bankrupt the Acadian Production Corporation of Louisiana as a “limited” partner, until and unless the claimed “limited” partnership be first so adjudged.

The term “partnership” is no more specifically defined by the Bankruptcy Act of 1938 than it was by the Act of 1898, and, as a general rule, reference must be had to state laws and judicial decisions on partnership law, in any given case, to determine the question whether a partnership exists or not. It may, however, be observed, in passing, that under the 1898 Act it was held, by all cases on the particular point, that in order to adjudicate as bankrupt a claimed partnership, an “actual” one, and not one by estoppel, had to be shown, although no formal partnership agreement was required. The mere “holding out” of another as a partner was not, of itself, sufficient to bring the alleged partnership within the operating orbit of the Act, and there seems to be no reason why the same legal situation should not continue to exist under the Act of 1938. Collier on Bankruptcy, 14th Ed. 1940, Vol. 1, #502, pp. 689-691.

Mover’s counsel contend that under the law and the jurisprudence of Louisiana, a partnership exists between the two corporations, the Acadian Production Corporation of Louisiana, and the Iberia Petroleum Corporation, but, in my view of the matter, this contention is not well-founded.

The contract of January 22, 1940, by and between Acadian Production Corporation of Louisiana and Iberia Petroleum Corporation (which was only recorded on February 13, 1940), does not conclusively show the existence of the claimed partnership between the two corporations, as mover’s counsel argue in their brief.

Even admitting that a partnership was legally possible, such contract does, on the contrary, establish that if a partnership was intended by the parties contractant, such partnership was not to come into being until the consideration of sale was first paid by the Acadian Production Corporation of Louisiana, as purchaser from the Iberia Petroleum Corporation of the 68%% of the latter corporation’s %tihs right and title in and to a certain oil, gas and mineral lease. That consideration was :

(1) The assumption by such purchaser, of all the lessee obligations contained in the said oil, gas and mineral lease, and

(2) The drilling of two test wells on the leased premises, at the sole cost and expense of Acadian Production Corporation, assignee, as aforesaid.

As a matter of fact, so far as the record made up on the trial of the motions established, the entire payment and discharge of the consideration of sale has not yet been effected.

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Bluebook (online)
35 F. Supp. 40, 1940 U.S. Dist. LEXIS 2459, Counsel Stack Legal Research, https://law.counselstack.com/opinion/tatum-v-acadian-production-corporation-laed-1940.