New Orleans Railroad v. Morgan

ON motion to dismiss writ of error.

The New Orleans, Opelousas, and Great Western Railroad Company issued, on the 1st April, 1859, two thousand bonds, redeemable in 1889, for $1000 each, with interest, payable semi-annually; and to secure the payments a mortgage was executed upon the road (eighty miles), together with the depots and lands appertaining to them, &c.

On 23d February, 1869, Charles Morgan filed his petition in the Circuit Court of the United States for Louisiana, averring that he was the holder of a certain number of these bonds, and of coupons on them overdue.

On this petition an order was made, 30th March, 1869, directing the company to pay, on three days' notice, $316,840, and in default of payment the mortgaged property to be seized and sold for the whole debt.

[The reader will observe that this proceeding, known in the civil code of Louisiana as executory process, is wholly ex parte. The mortgage is held to be in the nature of a confession of judgment, and the judge grants the execution, upon the application of the party, as a matter of course, upon the production of authentic evidence of the mortgage, and bonds or notes.]

The company, being in a great state of embarrassment, was unable, thus summarily called on, to pay the large amount required by the order, and a seizure of their property was made by the marshal, and notice thereof served on the 5th April.

On the same day the company filed its bill on the equity side of the said Circuit Court, asking that for causes therein assigned the proceedings in the executory process should be stayed, and Morgan be required to file a bill on the chancery side of the court, to which all the creditors might be made parties, &c.

The motion for the injunction on this bill was heard 27th April, 1869.

The property was advertised to be sold under a writ of seizure, on 25th May, 1869, and it was not until the day before this sale, to wit, on 24th May, 1869, that the judge entered the following order:

'For reasons orally assigned, it is ordered and decreed that the prayer for an injunction be denied, with costs.'

At the sale on the 25th May, Morgan, in the absence of the other creditors, became the purchaser of this very large property.

On the 1st June, 1869, the company for the first time appeared on the law side of the said Circuit Court, and filed its petition in the nature of an audit a querel a; averring that the executory process could not be legally ordered without notice; that the order was made without notice; without proper evidence and parties; that the subject of the suit was only cognizable in chancery, &c., and prayed an award of 'a writ to Charles Morgan, expressing a willingness to hear this complaint,' that the validity of the said proceedings might be examined, and that they be restrained and suspended by writ until a final order herein.

Exceptions were filed on the 8th June by Morgan, and on the 14th June the following order and entry was made:

The court having duly considered the petition and exhibits submitted by the petitioner in this cause, and being satisfied that the prayer cannot be granted, it is ordered and decreed that the said petition be dismissed with costs.

Judgment rendered 14th June, 1869. Judgment signed 18th June, 1869.

E. H. DURELL, Judge.