The question posed for our determination is whether a certain promissory note made by relator, Henry Jochum, constituted a debt not affected by a discharge in bankruptcy.
Under a series of loan transactions commencing in 1943 or 1944, defendants were occasional debtors of plaintiff. On November 29, 1955, they executed a $300 note (type 3½-2½%) with plaintiff, a balance of $199.17 being in arrears on November 5, 1956. On the latter date, defendants executed a new note for $300; their note of November 29, 1955 was cancelled and returned to them, and they received net cash of $100.83. The company card evidencing defendants' payments on their 1955 note bore the following notation: "New Loan, #7465; Renewed, 11-5-56; Amount, $300.00; Prev. Bal., $199.17; Net, $100.83." In executing the 1956 note, defendants signed a financial statement, wherein they recited that they owed George Glover $150 and were indebted to C H F Finance Company, Inc.; they further stated, "We have no other debts."
On June 23, 1958, plaintiff filed suit on the note of November 5, 1956, alleging "that the said note stipulates that on failure to pay any installment, the whole of said note shall at once become due and exigible, together with 25% attorney's fee on principal and interest; that the defendants have paid $65.77 on account of said note, and interest through September 5, 1957, leaving a principal balance past due and unpaid of $234.23 together with interest and attorney's fee as aforesaid." They further alleged that amicable demand was made on defendants without avail. Plaintiff prayed for judgment against the defendants in the sum of $234.23, together with interest and attorney's fee.
Defendants in answer specially pleaded their discharge in bankruptcy as to the debt sought to be recovered by plaintiff, averring that plaintiff was listed as a creditor, had received notices of meetings of creditors, and had had opportunity to oppose defendants' discharge, but had neglected to do so. Alternatively, defendants averred that if the debt were not one dischargeable in bankruptcy recovery should be limited to the actual cash received, as the transaction constituted a refinanced obligation. Defendants further prayed that no recovery should be had for interest and attorney's fees, averring that they were contractual obligations barred by the discharge in bankruptcy.
The trial court rendered judgment in favor of plaintiff and against defendants, for the full sum of $234.23, with 3½% per month interest on any unpaid principal balance not in excess of $150, and 2½% per month interest on that part of the unpaid principal balance in excess of $150 from September 5, 1957 to July 7, 1959, and 8% per annum interest thereafter until paid, plus 25% attorney's fees on principal and interest, and all costs.
The Court of Appeal dismissed plaintiff's suit against Mrs. Jochum; it amended the judgment against Henry Jochum, so as to provide that it should bear interest at the rate of eight percent per annum from September 5, 1957, until paid.
We granted certiorari (Art. VII, Sec. 11, La. Constitution of 1921) upon the application of Henry Jochum. He alleges that on the merits of the matter as a whole, it would appear that the plaintiff has not borne the burden of proving the intention of defendant to defraud it, nor has it shown that his statements were relied upon to make the note in question.
When this matter was decided by the Court of Appeal, it was provided in Section 17 of the Bankruptcy Act (11 U.S.C.A. § 35) that "(a) A discharge in bankruptcy shall release a bankrupt from all of his provable debts, whether allowable in full or in part, except such as * * * (2) are liabilities for obtaining money or property by false pretenses or false representations, * *"
The record herein contains a stipulation, made in the trial court by counsel for defendants, to the effect that defendants filed bankruptcy proceedings in the United States District Court for the Eastern District of Louisiana, on October 7, 1957, and that the debt herein involved was listed in the schedules. Counsel for plaintiff stipulated that the defendants were discharged prior to the filing of the instant suit.
Henry Jochum affirmatively testified that at the time he executed the note of November 5, 1956, he had creditors other than those listed in the financial statement he signed; he said that he could only think of two creditors at the time. A reading of the entire testimony of record convinces us that the following statement of the Court of Appeal is correct:
In the case of Guedry Finance Company v. McCubbin, 120 So.2d 298 (certiorari denied)
Having decided that Henry Jochum made false representations to plaintiff with the intention of receiving cash and refinancing his note and that plaintiff was misled by such representations, we must determine whether plaintiff is entitled only to the cash received by the defendant Henry Jochum when he executed the note of November 5, 1956, or whether plaintiff should recover the face amount of the note less any payments made.
Plaintiff contends that the old promissory note, which was cancelled and returned to Jochum on execution of the new note, together with $100 cash, was property within the statutory contemplation of Section 17, sub. a(2), 11 U.S.C.A. § 35, of the Bankruptcy Act.
Relator, Henry Jochum, argues that the old promissory note, when received by him, was not property; as authority, he relies on statements made in 6 Am.Jur., Sec. 782, p. 1008, and 8 C.J.S. Bankruptcy § 573, p. 1513 et seq., which set forth that the extension or renewal of an existing note is not the equivalent of "property" within the meaning of the exception from discharge of a liability for obtaining money or property by false pretenses or false representations.
We have read the authorities cited by relator and find that the statements therein made relate to specific situations; they do not set forth a hard and fast rule which applies to the facts of every claim against a bankrupt for obtaining money or property on credit through false representations or false pretenses as to his financial condition at the time the money or property is obtained.
It is a recognized rule of statutory construction that the act as a whole ought to be interpreted so that no clause, sentence, or word, shall be superfluous, or meaningless, if that result can be avoided. Hibernia National Bank in New Orleans v. Louisiana Tax Commission, 195 La. 43, 196 So. 15; Dore v. Tugwell, 228 La. 807, 84 So.2d 199; Bartley, Inc. v. Town of Westlake, 237 La. 413, 111 So.2d 328. In interpreting a part or section of an act in dispute, the part or section should be interpreted with the rest of the act. Pepsodent Co. v. Krauss Co., 200 La. 959, 9 So.2d 303. A familiar canon of construction requires that the meaning of a statute is to be looked for in all its sections taken together and in that posture related to the end in view. United States v. Vivian, 7 Cir., 224 F.2d 53; 350 U.S. 953, 76 S.Ct. 340, 100 L.Ed. 830; Smither & Co., Inc. v. Coles, 100 U.S.App.D.C. 68, 242 F.2d 220; 354 U.S. 914, 77 S.Ct. 1299, 1 L.Ed.2d 1429.
Section 14 of the Bankruptcy Act, 11 U.S.C.A. § 32, sub. c(3), recites:
In Gilbert's Collier on Bankruptcy, Section 14, Discharges When Granted, VII.
Under the above authorities, we find no objection to ascertaining the meaning of the term "property" from both Section 14 and Section 17 of the Bankruptcy Act. The fact that plaintiff, a creditor, asserts that its claim is protected by Section 17 of the Act does not preclude its reliance on interpretations of "property" under Section 14. "In the absence of clear indication of congressional intent to the contrary, the identical language in sections 17 and 14 would receive the same construction." Personal Finance Co. of New Jersey v. Bruns, 16 N.J.Super. 133, 84 A.2d 32, 33.
In the case of Samet v. Farmers' & Merchants' National Bank of Baltimore, 4 Cir., 247 F. 669, 670, the Court had under consideration the term "property" as set forth in Section 14, sub. b of the Bankruptcy Act. We believe that the following statement from the opinion is applicable to Section 17 of the Act:
* * * * * *
Although the decisions of other jurisdictions are not controlling on the Courts of Louisiana, if they determine an issue practically identical with the one under consideration, they possess at least a persuasive effect and merit attention. See, Michiels v. Succession of Gladden, La.App., 180 So. 862; 190 La. 917, 183 So. 217.
The case of Personal Finance Company of New Jersey v. Bruns, 16 N.J.Super. 133, 84 A.2d 32, 33, involved a factual situation identical in substance with the instant matter. In deciding in favor of the plaintiff, the Court stated:
The case of Public Loan Corporation v. Hood, Ohio Com.Pl., 125 N.E.2d 770, 775, presents facts substantially the same as those in the instant matter; therein, the Court stated:
The case of Leeds, Inc. v. Love, 104 Ohio App. 145, 145 N.E.2d 154, 156, contains the following persuasive language:
* * * * * *
A review of all the authorities cited and quoted, supra, impels us to conclude that the defendant Henry Jochum obtained property by false representations within the meaning of the Bankruptcy Act when he secured the cancellation and receipt of his promissory note of November 29, 1955. Plaintiff is therefore entitled to recover not only the amount of the cash advanced to Jochum but also the face value of the promissory note of November 5, 1956, less any payments made thereon.
The case of Personal Finance Co. of Shreveport, Inc. v. Murphy, La.App., 53 So.2d 421, cited as authority for relator's contentions, is not factually the same as the instant matter. In that case, an unmatured note was surrendered to the defendant when he executed a new note for the unpaid balance of the old note and cash received by him. The Court of Appeal stated therein that it failed to find that any installments were in default at the time of the execution of the second note; under such conditions, the Court held that plaintiff was only entitled to recover the cash defendant received when he executed the new note. See, Personal Finance Co. v. Moore, 153 Me. 122, 135 A.2d 414.
For the reasons assigned, the judgment of the Court of Appeal, Fourth Circuit, is affirmed. All costs are to be paid by relator, Henry Jochum.
SUMMERS, J., concurs in the decree.
McCALEB, Justice (concurring).
I concur in the decree but, unlike the majority, I am unable to perceive any difference, factual or legal, between this case and Guedry Finance Company v. McCubbin, 120 So.2d 298, where the Court of Appeal, just two months prior to its decision herein, reached a contrary result. Indeed, this conflict of view by the same court was the main reason for granting a writ of review herein.
It is true, as pointed out in our majority opinion, that the Court of Appeal stated in the McCubbin case that the finance company was not defrauded and suffered no financial loss because, prior to his bankruptcy, the debtor repaid more ($79.99) on the new note than he actually received in cash ($32.61) when he obtained the surrender of his past-due 1956 renewal note, on which he owed a balance of $265.14, and replaced it with the new obligation for $300 "* * * in order to get some ready cash and bring his account up to date." However, this statement was purely gratuitous and had nothing whatever to do with the question presented for decision, i. e., whether the securing of a cancellation of a matured obligation, by means of a fraudulent financial statement on which extended credit is obtained, falls within the purview of Section 17 of the Bankruptcy Act, 11 U.S.C.A. § 35.
The McCubbin case is indistinguishable from this one and I think it behooved this Court to say so; to admit that we erred in denying a writ of certiorari on the ground that there was no error of law in that matter "On the facts found by the Court of Appeal, * * *". The finance company in the McCubbin case suffered a loss of almost $220, if the decision herein is correct, just like the plaintiff in this case has sustained a loss of $234.23, for which it is given judgment against defendant.