author: Walker, P. J.—

text:
    J. W. H. Cliett et als. v. E. H. Cliett et als.
    (Case No. 3435.)
    1. Will—Devise of land — Condition precedent.— A will devising land to such of the testator’s children “ as shall move on it before the 1st day of January, 1870, or before my decease,” is not contrary to public policy and good morals; the condition requiring them to move on the land within a specified time was a condition precedent, and devisees failing to comply were not entitled to claim Tinder the will. 2 Redf. on Wills, 283; 1 V. & B., 248.
    2. Codicil —Will.— The effect of a codicil ratifying, confirming and republishing a will is to give the same force td the will as if it had been written, executed and published at the date of the codicil, and all the provisions of the will not inconsistent with the codicil will stand.
    Appeal from Caldwell. Tried below before the Hon. L. W. Moore.
    This suit was instituted on the 7th day of August, 1875, in the district court of Caldwell county, by John V- H. Cliett, Betsy E. Harralson, joined by her husband, Eliza M. Mosely, joined by her husband, and Thomas A. J. Cliett, all of whom were alleged to reside in the state of Alabama, except Thomas A. J. Cliett, who was alleged to reside in the state of Mississippi, against Edilda H- Cliett, since deceased, but represented in this suit by Aaron Compton, administrator of her estate, and who was the widow of Thomas H. Cliett, deceased, the testator under whose will the plaintiffs claim; also against Nathan M. Cliett, John G-. Blanks, Z. J. Williams, Moses Gray, Griffith Bogan, Nathan M. Cliett and B. J. Collins, and also, by amended petition, against Emelin e Davis and her husband, Stephen Davis.
    The petition alleged that the plaintiffs, John W., Betsy E., Eliza M. and Thomas A. J. Cliett, were children by his first wife, Jane Clie.tt, and heirs at law of Thomas H. Cliett, deceased, late of Caldwell county, state of Texas. That said Thomas H. Cliett died on the 27th day of May, 1868, leaving a will, which was set out in full in the petition. It gave to his wife, Edilda H. Cliett (his second wife, and who survived him), for life, with remainder to her children, naming them, the homestead place, known as the “ Steen place,” with the crops standing or gathered, with all the rents or issues pertaining to said premises, at the time of his death, after paying all his debts; also his stock of hogs.
    The will then proceeds thus, viz.:
    “ The place knpwn as the Procter place, adjoining on the southeast by the Steen place, on the northwest by the Walker place, and on the west by the San Marcos river, containing about five hundred acres, more or less, and being part of the Morrison league, for the great love and regard I have for my children had by my first wife, named Jane Cliett, now deceased, if they shall move to it by the 1st day of January, 1870, or before my decease, I give and bequeath as follows, for their own use and benefit, viz.: At a line to start on the original north line, so as to cross at the lower ford of the Morrison creek, in the field, to intersect the original south line joining the Steen land, then running on the original line so as to include one hundred acres, containing the Procter "houses, which I will and bequeath to Hathan M. Cliett. The residue of the tract I will and bequeath to the children that may be here, as aforesaid,—that is to say, Eliza M. Mosely, Betsy E. Haralson, John W. H. Cliett, Thomas A. J. Cliett, and Wilson L. Cliett, to be equitably divided; Wilson’s to include his improvements. And I hereby appoint Mathan M. Cliett to receive and collect all rents and issues that may be due or is gathered, pertaining to the Procter place, and to pay all debts that may be due by it, and, after paying himself for his trouble, to divide the sur-, plus, if any, among his own brothers and sisters that maybe here, as aforesaid.”
    The will contained provision foe the sale of “loose” property, under certain qualifications and directions given, and that the proceeds, after paying all expenses, to be divided among his children. The testator appointed Edilda H„ Cliett, H. H. Cliett, Edward Heppenstall, Elder T. P. Greenwood and G. Eogan executors, and the will provided that if either of said executors refuse or fail to act, then a majority of the remaining executors shall appoint some fit and competent person to act in their place, and that a majority of the above named executors may transact any business pertaining to the intention of this will; and it also provided that the executors should not be held responsible to make returns to the county court nor any other court whatever, until a final settlement for a discharge was had.
    The will was dated 3d day of June, 1867.

      On the 20th day of January, 1868, the testator made the following codicil to said will, viz.:
    “ On this, the 20th day of January, 1868, while still of sound mind and disposing memory, I, Thos. H. Cliett, further add to my.within and foregoing will, dated June 3, 1867, as follows: Of the ninth line from top of page three these words are stricken out, viz., the judge of the county court; and interlined with, a majority of the remaining executors. I further add that my executors shall divide the land between the within named heirs in a just and equitable manner, and that their division shall be final, except, where improvements have been made by the heirs, such improvements shall be included in their portion making them, without reference to their value, and that the improvements made by said heirs shall be included in the share of the one making them, and also ET. M. Cliett’s share, which is stated in the foregoing will; and, further, any moneys or cash assets that may be on hand at my death, my wife, E. H. Cliett, shall take into possession and use so much thereof as she may need for her own personal benefit, keeping a strict account of all such outlays, and at her death, the remainder, if any, shall be equally divided between all my living children. I further add, should either of the executors named fail to act, that I nominate William K. Posey to fill vacancy.”
    The petition alleged that the will was probated in the year 1868, and that Edilda EE. Cliett, ET. M. Cliett and G-. Hogan qualified as executors of the will, June 29, 1868, and entered upon their duties as such; and that none of the other executors nominated in the will have ever qualified, nor have the vacancies caused by their failure to qualify ever been filled. That Thos. II. Cliett at the time of his death was possessed of $1,334.55 cash — notes and accounts amounting to $681.18, and personal property, including horses, cattle, household and kitchen furniture, farming implements, etc., of the value of $2,000. That, in violation of the provisions of the will and in fraud of the rights of petitioners, the executors took said property into their possession and proceeded to appropriate the same to their own use, to their damage $10,000.
    The plaintiffs allege that it was the intention of said will that they should have and take four undivided sixths interest in the Procter tract of land, which the petition sets forth by metes and bounds, released and discharged from all conditions, and four undivided elevenths interest in the rents and issues of said lands and the personal property of which said testator died possessed, which petitioners say were reasonably worth $5,500, and that the profits of said land since the testator’s death are reasonably worth the sum of $2,500 per annum; that if any conditions were imposed upon them by said will, that they were contrary to public policy and good morals; and that petitioners, being heirs, were entitled to notice of the same before they could be affected thereby, and that they had no notice of any such conditions prior to the death of said Thos. H. Cliett on or before the 1st day of January, 1870. Wherefore they are entitled to four-sixths interest in the land, with rents and profits of the same, and four-elevenths of the personal property of said testator, and they allege that their title thereto vested immediately upon'the death of said testator. Petition alleges that said Edilda, Nathan M. and Wilson L. Cliett colluded and conspired together to defraud petitioners out of their share of the estate of their said father, and purposely and fraudulently concealed from petitioners the fact of the existence of said will, as well as the conditions and limitations therein expressed; and that on the 15th day of September, 1868, the said Griffith, Bogan and Edilda M. Cliett executed a deed of conveyance to Nathan M. Cliett of one hundred acres of said land; and that in January, 1870, they executed to said Nathan M. Cliett a deed to certain tracts of said land; and on the 12th day of January, 1870, they, being joined by N. M. Cliett, executed a certain other writing purporting to convey to Wilson L. Cliett certain other tracts of said land, which said deeds embraced' the whole of said tract known as the Procter place. Petitioners allege that said pretended conveyances were made without authority from the probate court, and in violation of the trust created and the power conferred by said will, and in fraud of the rights of petitioners, and as to them are void and of no effect. Plaintiffs allege that, after said conveyances were made, defendants Gray, Collins, Blanks and Williams entered upon said lands, and have taken possession thereof under deeds of conveyance from said Nathan M. and Wilson L. Cliett, with full knowledge of the title of petitioners, to four-sixths of the same, and of the fraudulent acts of said executors. Plaintiffs allege the receipt of rents and profits by said vendees, Gray and others, and pray for damages.
    The petition concludes with a prayer that the defendants appear and answer, and for an order of survey to ascertain the relative amounts of said land held and claimed by each of said defendants Gray, Collins, Blanks and Williams; for an order annulling, setting aside, and declaring of no effect the three several deeds from said executors, and requiring them to return into court a full exhibit of the condition of said estate; for an order confirming petitioners’ title to four-sixths, of said land, and for partition of the same between petitioners arid defendants Gray, Collins, Blanks and Williams ; and for judgment against said defendants for their said damages, and for general relief. The amended petition, filed November 19; 1875, alleges the death of Edilda II. Cliett since the institution of this suit; prays for process .against her administrator, Aaron Compton; makes said Davis and wife parties,, alleging that they are setting up title to a portion of said land, and pray judgment against them as in original petition.
    The defendants answered the petition, and filed a general demurrer to it. The plaintiffs had obtained leave to amend their petition, but on the hearing of the case withdrew application for said leave, and declined to amend their pleadings; the cause coming on to be heard, the demurrer was sustained and the cause was dismissed, the plaintiffs declining to further amend. Judgment final being rendered in accordance with this ruling against the plaintiffs for all costs of suit, they gave notice of appeal to the supreme court, and assign as error that the court erred in sustaining defendants’ general demurrer to the plaintiffs’ petition and dismissing the same.

      Stringfellow dk MoNeal, for appellants.

      Nix & Story, for appellees.
   Walker, P. J.—

The leading question in this case involves

the construction of the will, and the codicil. First as to the provisions of the will itself, viewed distinctly from the codicil, which appears, from its recitals, to have been written upon or else attached to the same paper containing the will. The devise to the plaintiffs of equal shares to the brothers and sisters of the testator’s first marriage is framed in careful language which clearly manifests the testator’s intentions. Not only does the first clause in the will, which purports to express his will concerning the disposition of the “ Procter ” tract of land, explicitly attach a condition to the devise which he makes to the beneficiaries, but, seemingly, with a cautious consideration directed against the possibility of misconstruction, in the subsequent clauses or paragraphs of the will, he continues to qualify each expression with reference to that particular devise, with terms which in effect are repetitions of the condition ; that condition is., “if they shall move to it” (the Procter tract of land); the other expressions referred to being such as these, viz.: “ The residue of the tract I will and bequeath to the children that may he here as aforesaid; ” and again, “ after paying himself for the trouble, to divide the surplus, if any, among his own brothers and sisters that may he here as aforesaid.” Negative and auxiliary evidence on the face of the will, in aid of this interpretation, is furnished by the use of terms contained in the will quite dissimilar in their application to all the other bequests and, devises to his- children; both those which relate to bequests to the children of the second marriage, and those in which the children of both marriages jointly and equally share. In all such, the language used is direct and plain, descriptive of the classes referred to; and the bequests and devises to them, contain no qualifications nor conditions whatever requiring that they or any of them shall remove to the land that is given to them, or that the bequest shall be limited by any act whatever to be done by the legatees.

“ Among the forms of expression which imply a condition in a grant, the writers give the following: ‘on condition/ ‘ provided always/ ‘ if it shall so happen/ ‘ or so that he the grantee pay, etc., within a specified time/ and grants made upon any of these terms vest a conditional estate in the grantee.” 2 Wash. Real Prop., p. 3. The term used in the will, “if they shall move to it,” is of import precisely equivalent to the forms expressing condition in the grant above quoted, and is not less unequivocal in its meaning than they are. It is a devise of the land “ on condition,” or “ provided that” the devisees shall move upon the land. To “ move ” upon land has a well understood signification; it is the act of actual domiciliation upon it; “move”— “to change residence; to remove, as from one house, town or state to another.” Worcester’s Die. “Words, moreover, often create a condition in a will which would not if made in a deed, as where in a will an intention is expressed in devising the land, that the devisee should or should not do certain things in respect to it, it may be construed as creating a conditional estate in him.” 2 Wash. Real Prop., p. 3. But here, the expressions used are not simply such as indicate a mere intention by the devisor that the devisees should move upon the land, which of itself might allow the devise to be construed as creating a conditional estate in it, but they are clear and emphatic terms, which of their own force constitute the devise a conditional one. The condition appears on its face to be a condition precedent; it fixes the limit or period within which the devisees are required to perform the act which shall entitle them to the land devised, viz.: “ If they shall move to it by the 1st of January, 1870, or before my death.” If they never should move to the land the devise would never take effect; it is nota devise of the land with conditions attached of acts to be done, which may accompany or follow the vesting of the estate, or which may as well be done after as before the vesting of the estate, but the estate is made to vest if tlie act of moving to the land shall be performed within the limits of designated periods. See 2 Wash. Real Prop., p. 5, sec. 4. “ It seems to be agreed that' in regard to all conditions, whether in a deed or will, or in simple contracts, where the condition is in the nature of a consideration for the concession, its performance will be regarded as intended to precede the vesting of any right, and so a condition precedent.” 2 Redf. on Wills, p. 283. In this case it may be supposed that the testator was influenced by a desire to gather his children from abroad near and around him previous to his death, and that the concession was influenced by it, and perhaps by a further desire that his children after his death should live near each other on the same tract of land, or else that he was unwilling that any part of the land should be occupied by others than his children, or such of them as would be willing to occupy it as a home, which design would be frustated, probably, by making an unconditional devise to them all jointly, unless the motive for retaining the property entire was encouraged by requiring its owners to actually domiciliate themselves upon it. Whatever may have been the inducements to the conclusion of the testator, the terms which he imposed seemed to have been, at all events, “ in the nature of a consideration for the concession.”

The general intent of the will controls the mere form of conditions, and it is well settled that “ where the words are' in the form of‘a condition precedent, but the intentions of a testator, as collected from every part of the will, clearly indicated a different purpose, the latter will prevail.” 2 Redf., p. 299, sec. 36. In this case the form of the condition expressed in the will, and the general purpose and intent of the whole, will harmonize in illustrating the same intentions on the part of the testator, and to chai’acterize the devise to the plaintiffs as an estate upon condition precedent. The conditions contained in the will are not, as alleged in the petition, contrary to public policy and good morals. It is urged by appellants, in argument, that the conditions were captious, and void as to Mrs. Mosely and J^rs. Haralson, because, being married women, they were incapable of assenting to them, in the matter of selecting their domicile. The testator, if he does not infringe the rules of law, has a right to say with-Staberius, when he imposed an unpalatable condition in his will, sine ego prave, sen rede, hoc volui.” 4 Kent, note (a), 535. It is no objection to carrying out the obvious intention of the testator, if it be not illegal, or against good morals, that it is strange, or unnatural, or absurd. 1 Redf. on. Wills, 434, 435. And, besides, “conditions requiring an illegal act, as in restraint of marriage, are void; but if they are conditions precedent, the estate will not vest, it being of the essence of the bequest that it shall not become operative until or unless the condition is performed or takes effect. And the same rule applies as to the vesting of an estate, made dependent .upon the performance of a condition precedent, where the condition is or becomes impossible. The estate which depends upon a condition precedent cannot vest where the condition fails for any cause.” 2 Redf. on Wills, p. 284, sec. 8. “ A condition is not regarded as impossible because it is beyond the power of the devisee'to perform it. It is so, only when it becomes physically impossible of performance.” 2 Story, Eq. Jur., sec. 1305. “ A legacy on condition of being claimed by the legatee in a certain time and manner is forfeited if the legatee die without performing the condition.” 2 Redf., 285 (note 14), citing Tulk v. Honedetch, 1 V. & B., 248.

The appellants allege the want of notice to them of the provisions of the will until after the period of time, viz., 1st of January, 1870, and a fraudulent combination to deprive them of such information. If these facts entitle them to exemption from the stringency of the conditions, they, nevertheless leave standing in continued force the condition upon which the estate, at last, must vest, if at all, viz., that they shall move to the land. They do not deny their knowledge of the contents of the will after the month of January, 1870; it will be taken, therefore, on the demurrer that they did so know, and yet with such knowledge" they do not allege any attempt to move to the land, nor to remove to the state, nor that they took any action in the premises during the period which intervened up to the institution of this suit on the 7th day of August, 1875, about five years and six months thereafter; nor does the petition allege an offer to move at the time of bringing suit, nor at any time" since, nor does it intimate any wish, intent or desire to comply with the said condition. The petition admits that the will was duly probated in the proper county shortly after the-testator’s death in 1868; such an admission néutralizes the allegation of combination and fraud. A recorded will gives full notice to the world of its contents; there could be no fraudulent concealment, at least as to what the will contained, after it was recorded. Whether the devisees, however, had notice or not is an immaterial fact, unless they comply with the condition of the devise to them, and if, after a period of more than seven years from ■ the date of the testator’s death, they do not move nor offer to move upon the land, nor allege a willingness to do so, they certainly show no cause of action whereby to recover the land under the provisions of the will.

It remains to be considered how far the will is affected by the codicil. “It is a clear principle of English and American law, that all codicils, however numerous, are to be regarded as parts of the will, and all, together with the will, are to be construed as one instrument.” 1 Redf. on Wills,. 287, The codicil should be so construed, if it can be fairly, done, as to make it harmonize with the purposes declared in, the body of the will. Proctor v. Duncan, 1 Duvall, 318; Delafield v. Parish, 25 N. Y., 9. A codicil which clearly recognizes the existence of a former will operates as a re^ publication of it; and the effect of a codicil' ratifying, .confirming and republishing a will is to give the same force to-the will as if it had been written, executed and published at the date of the codicil. 2 Redf. on Wills, 287, 288.- “In interpreting a will and codicil, the general rule is that» the whole will takes effect so far as it is not inconsistent with the codicil. And if a devise in the will is clear, it is incumbent upon the party who claims its revocation by the codicil to show an intention to revoke, equally clear with the original intention to devise.” Id., 291, note 22, and authorities there cited.

“ The general rule of construction is that already stated, •to allow all the provisions of the will to stand which are not inconsistent with those of the codicil, and in determining this, to seek for the intention of the testator as far as practicable.” . . . “And it seems clear that general \yords will not ordinarily be held a revocation of a specific devise or bequest, where it is apparent such could not have been the intent of the testator.” 1 Redf. on Wills, pp. 352, 353. . . . “ The codicils will be construed as being consistent with the will, where the discrepancy claimed is not obviously intended by the testator.” Id., 353, 354.

The application of these rules and maxims of construction to the codicil before us relieves the subject of all doubt what-if indeed any serious question could otherwise have existed concerning the testator’s intentions in making both the will and the codicil. The codicil seems to have been indorsed upon or attached to the will itself, for the will is expressly recognized and referred to at the beginning of the codicil as “my within and foregoing will, dated June 3, 1867.” Construing the will and codicil together as if both had been written at the same time with the codicil, and as one instrument, it is apparent no change was intended to be made by the testator in regard to the devise to the plaintiffs contained in the will; and the provisions made in respect to the subject-matter, which are contained in the codicil, are not merely consistent with the conditional devise in the will, but they are just such as might be expected to be added in order to encourage the acceptance of the devise by the devisees, and to prevent the litigation which might be entailed among them, growing out of questions of partition and improvements made and to be made by those who were then upon the land, as well as by those who might move to the land before the end of the time limited in the will. The will itself recognized the fact that Wilson L. Cliett had improvements upon the land at the date of the will, and presumably ivas then living on it, or was expected by the testator so to do; the will attempted to make suitable provision for an equitable division between all of the legatees; for as to E. M. Cliett his part was designated by metes and bounds, and as to Wilson L., the will provided that his improvements should.be included in an equitable division to be made between all who would move to the land. The codicil provides that the executors shall divide the land between the within named heirs in a just and equitable manner, and that their division shall be final, except that where improvements have been made by the heirs, such improvements shall be included in the portions of those respectively who shall have made them, without reference to their value, and that the improvements made by said heirs shall be included in the share of the one making them; “ and also E. M. Cliett’s share, which is stated in the foregoing will.” It is evident that the division here referred to has respect to the Procter place. There were but two tract's of land named in the will-—the other, the homestead place, was given to his wife for life, and remainder to her children. Eo division of that tract could have been contemplated during the pendency of the administration of his estate; and the direct reference to the share of E. M. Cliett, which was one hundred acres in the Procter tract, as well as the entire context of the codicil, shows conclusively that the division to be made was of the Procter tract. The additional provisions concerning it, then, were to carry out, without change in the condition of the devise contained in the will; the terms of said devise. It was intended to afford the same guaranties to the other devisees who would move to the land in respect to their improvements in the division which would be made, as the will had given to E. M. Cliett audio Wilson L. Cliett; besides, after giving that assurance, it meant to prevent dissensions and litigation by a final, irrevocable partition to be made by the executors of the will. The intention of the testator is clear and manifest, and the use in the codicil of the word “ heirs,” in the place of “ children,” in describing the devisees, in-no wise weakens the force of the construction we have given to these instruments. There is no expression whatever in the entire instrument which implies an intention to change or vary the terms of the devise in the will; so far from it, indeed, that the codicil, viewed as a whole, may be regarded as a painstaking effort to give thorough effect to it, ¡by making further provision for the just and satisfactory operation of the testator’s designs in regard to the disposition of the Procter place.

This view of the plaintiffs’ case disposes of every branch of the cause of action set forth in the petition except that which alleges the appropriation by the executors of the cash, notes, accounts, etc., and also the appropriation by them of personal property amounting to $2,000. The brief of counsel abandons the count which relates to the cash, and notes and accounts; and as to the remaining portion of the same, based on the alleged appropriation of personal property, the petition, was, we think, insufficient. The allegations amounted to nothing more than a conclusion of law. In view o‘f the provisions of the will concerning the personal property, no facts were alleged by the petition which showed any certain sum remaining in the hands of said executors after they should have made the reservations contemplated by the will for the use of the widow, and should also have paid all the expenses contemplated in the will to be paid by them. The petition contained only a prayer for a return into court of a full exhibit of the condition of the estate, and no fact is alleged which would give the district court jurisdiction of the accounts of the executors, it not appearing that said executors had yet closed the administration. The county court has jurisdiction to require a final account! The petition is, perhaps, objectionable for multifariousness ; it seems to unite causes of action of different natures against defendants who have no common interest nor privity with each other in relation to the subject-matter. Frost v. Frost, 45 Tex., 324. It is not clear to us that, an action against the executors for waste and misappropriation, of property, ought, in the same suit, to be' joined with an action to recover land, which, although in form may be similated to that of a partition suit, yet which shows on its face that it is a suit, in effect, to try title to the land. However that may be, we think that the petition, according to the terms of the bequest and directions given as to the personal property, was insufficient, and did not show a cause of action against the executors for any alleged default or misappropriation of proceeds of personal property of the estate. Chrisman v. Miller, 15 Tex., 160; Jackson v. Hall, 3 Tex., 305.

[Opinion delivered June 14, 1880.]

We are of the opinion that there was no error in the judgment rendered by the district court, and that it ought to be affirmed, and it will be so awarded.

Affirmed.


source: Caselaw Access Project

author: A. S. Walker, J.

license: Public Domain

text:
    P. H. & J. T. Swearingen v. Ed. Buckley.
    (Case No. 3910.)
    1. Payment — Railroad “time checks.”— Whatever is received by the creditor in satisfaction of his debt will be effectual as a payment, as between the creditor and his debtor. Receiving “time checks ” of a railroad, in satisfaction of a note, by a creditor of his debtor, is a payment. 2 Greenl. Ev., sec. 516; id., 520; 2 Dan’l on Neg. Inst., sec. 1222; id,, 1623; Blair &Hoge v. Wilson, 28 Gratt., 165; Boulware v. Robinson, 8 Tex., 330; Ables v. Lee, 6 Tex., 434; McNeil v. McCamley, 6 Tex., 165; Robson v. Watts, 11 Tex., 768; Cartwright v. Jones, 13 Tex., 4; Wells v. Fairbanks, 5 Tex., 582; Jennings v. Case, 17 Tex., 673; Morphy v. Garrett, 48 Tex., 249; Life Ins. Co. v. Ray, 50 Tex., 518.
    2. Notice — Non-negotiable instrument.—It is the duty of the assignee of a non-negotiable instrument to promptly notify the maker of such transfer, and the maker will be protected if he pays the payee without notice of assignment, the absence of the note being reasonably accounted for. Daniels on Neg. Inst., sec. 742.
    3. Estoppel—Promissory note — Deed of trust — Sale under.— Equivocal transactions by the holders of a note, not known to the maker, will not constitute as to him an estoppel. The assignment of a non-negotiable instrument, after maturity, passes no right against any defense the maker could have against the original payee. The right to order a sale of property under a deed of trust given to secure such an instrument depends upon the existence of an indebtedness. The debt satisfied, the power ceases, and a purchaser at such sale does not acquire any title to the property so sold, notwithstanding the provision of the deed of trust, that “ the recitals in the conveyance made to the purchaser shall be full evidence of the matters therein contained, and no other proof shall be of Inquest by the holder of said indebtedness to the trustee to enforce this trust, or of the advertisement or sale of any particulars thereof, and prerequisites of sale shall be presumed to have been performed, and the sale under the powers herein granted shall be a perpetual bar against the maker of this trust deed and his heirs and assigns.”
    Appeal from Washington. Tried below before the Hon. E. B.-Turner.
    On May 5, 1876, Ed. Buckley, who resided in Hempstead, bought of Peter Basmussen "two lots in the town of Brenham for $500, paying cash $264 and executing his note for $236, payable to Peter Basmussén on or before May 1,1877. To secure the note Buckley gave a deed of trust on the lots, having received a deed therefor,'to J. T. Swearingen.
    December 7, 1876, Buckley went to the business place of the payee, with his deed, and proposed paying the note, offering one or more time checks (on the H. & T. O. B. B. Co., of which company Buckley was an employee) in payjnent; the checks were taken and $20 in excess returned to Buckley, and a receipt in full at the time indorsed on the deed for the lots. The payee told Buckley at the time that the note was mislaid and would never trouble him any more.
    It seems that soon after the date of the note it passed into the hands of one McDonald, who claimed to own it in right of having deeded the lots to Basmussen to keep it from his creditors. After the maturity of the note, McDonald sold it to P. II. and J. T. Swearingen, lawyers, who had prepared the deeds, etc., between the maker and payee, for $150. Heither McDonald nor the Swearingens notified Buckley of their claim. Under the' power a substituted trustee, after careful advertisement, sold the lots and deeded them to said Swearingen & Swearingen.
    September 20, 1877, Buckley brought suit to set aside and annul the sale and deed against the purchasers, P. H. & J. T. Swearingen, alleging the facts in detail. The allegations as to payment, etc., are substantially as follows:
    “That plaintiff, being indebted to Peter Rasmussen, on the 5th of May, 1876, executed to him his note, in substance as follows:
    “ $236 cy. Brenham, May 5, 1876.
    “ On or before the 1st day of May next, I promise to pay to Peter Rasmussen the sum of two hundred and thirty-six dollars, cy., balance due for purchase of lots in Brenham, with 10 per cent, interest thereon from maturity. This note is secured by deed of trust bearing date herewith to J. T.
    Swearingen.
    (Signed) “Ed. Buckley.
    “ That on the same day, the better to secure the payment of the note, he executed to J. T. Swearingen, as trustee, a deed of trust on the lots mentioned in the note. That on or about the 7th of December, 1876, he paid to Peter Rasmussen the full amount due on the note, believing him to be the owner of the note, and that it was mislaid, no notice of any assignment or transfer having been given to him; that he paid off and discharged the note, believing it to be the property and in possession of the payee, and without notice or reason to believe that it had been transferred to any other person.”
    The defendants pleaded general denial; set up their purchase as showing legal and equitable title; denied particularly that plaintiff had paid the note as alleged, etc.
    The case was submitted to the judge, and, at request of parties, he announced the grounds of his judgment. They are as follows:
    1. The court discarded the testimony of Rasmussen.
    2. The note is non-negotiable.
    3. The plea of payment was sufficient to authorize the introduction ofithe evidence of plaintiff tending to show payment of said note.

      4. The evidence was sufficient to establish the payment of said note without actual notice that Basmussen was not then the owner of the same.
    5. That the facts in- evidence were not sufficient to put plaintiff upon his inquiry as to the fact that the note was not, at the time of payment, the property óf some other person for value, and thus defeat the action.
    6. That plaintiff was not estopped to show payment of said note, and to set aside the sale of said lot and cancel the deed to defendants, because of the recitals in said trust deed of the negotiability of said note and the sale under the same.
    Y. The fact that the defendant purchased said note for a valuable consideration, and purchased said lot at sale under said trust deed (all of which the court finds to be true), does not constitute a sufficient defense to this action.
    8. That defendant did not exercise due diligence when he purchased the non-negotiable note, and upon these grounds judgment was rendered for the plaintiff.
    The court rendered judgment for the plaintiff. The de- ' fendants appealed.
    The numerous assignments of error relate:
    1. To the relevancy of the testimony and its sufficiency to sustain the allegation made in the petition of payment of the note by plaintiff.
    2. Whether there was evidence of actual or constructive notice to plaintiff at the date of his payment of the claim of McDonald or of defendants to the debt, etc.
    3. The effect of the recitations in the deed of trust executed by plaintiff, and of the acts under it, as an estoppel.
    The facts will not be stated more in detail than necessary to the points decided. The testimony to the ownership of the note and to the dealings among the parties was confused and in part inconsistent.

      Shepard <& Garrett, for appellants.

      Sayles & Bassett, for appellee.
   A. S. Walker, J.

I. The petition alleged payment and discharge of the note. This, as an allegation of payment, was sufficient. The full allegations are given above.

The appellant insists that the testimony admitted tended to show not a payment, but an accord and satisfaction; that money was not paid, nor the full amount; both of which, appellants insist, must concur to support the allegation. The testimony is, in substance, as follows on this point:

Peter Rasmussen testified: “ That the note was paid to him in full on the 7th of December, 1876, by plaintiff, in presence c f Sterling and O’Mealy, and perhaps others. That he did not have the note in his possession at the time; that Mrs. McDonald had taken the note from his possession through mistake. That he told Buckley the note was mislaid, and that it would not trouble him. That, on the 9th of February, 1877, J. T. Swearingen .called upon him to indorse the note, w’hich he refused to do. Sterling proves the payment in money and “ time checks.” (Time checks would be an order on the H. & T. C. R. R. Co.)

O’Mealy testified: “ That he was present on the 7th of December, 1876, when Ed. Buckley paid the note to Peter Rasmussen. He saw Buckley pay Rasmussen some ‘ railroad time,’ but don’t know the amount, but Rasmussen handed him back some change in money. A receipt was given on the deed for the amount, which he attested as a witness. It was admitted by defendants that there was a receipt on the deed to Buckley for $236, in full of the vendor’s lien note described in the deed, and that the receipt was signed by Peter Rasmussen and witnessed by John O’Mealy.”

Plaintiff testified: “I live in Waller county; employed as section boss on the H. & T. C. R. R.. I bought the lot from Peter Rasmussen and paid him $264 at the time, and gave note for balance. At the time of purchase I told him I would pay the note as soon as I got the money. I came to Brenham on December 7, 1876, and went to Rasmussen’s bar-room to pay him the note; he said the note was mislaid, but would not trouble me any more; he would put a release on record. I had no notice that the note had been assigned. 1 paid the note in ‘railroad time,’ and $20 over, which Rasmussen returned to me in money, and gave me a receipt for the note on the back of my deed.”

In the transaction the time ehecles appear to have been considered as representing money. There is no evidence of non-payment of them.

Referring to elementary works for the meaning of the term payment, we find it more extensive in signification than the appellants are willing to admit in their brief.

“ The word payment is not a technical term; it has been imported into law proceedings from the exchange, and not from law treatises.” 2 Greenl. Ev., sec. 516. “The burden of proof (of the defense of payment) is on the defendant, who must prove the payment of money or something accepted in its stead to the plaintiff.” Id., sec. 516.

Again: “If the creditor receives the debtor’s check for the amount, it is a payment if expressly received as such.” 2 Greenl. Ev., sec. 520.

In Bouv. L. Die., defining payment, after giving the general definition, the author adds: “ By payment is understood every way by which the creditor is satisfied or ought to be, and the debtor liberated; for example, an accord and satisfaction will operate as payment.”

Again: “Payment (of a debt) is not necessarily a payment in money; but that is a payment which the parties contract shall be accepted as payment.” 2 Dan’l on Reg. Rotes, sec. 1222, and authorities. “A creditor may, if he pleases, accept a check in absolute payment.” Id., sec. 1623. “ And whether so taken or not is question of fact for the . jury.” Id., note; Blair & Hoge v. Wilson, 28 Gratt., 165.

In our own decisions the subject has received some attention.

In Boulware v. Robinson, 8 Tex., 330, was a discussion as to a payment sufficient to authorize a recovery by a surety, in a suit against his principal, for money paid. It was held in such case that a discharge of a debt by the surety giving a negotiable note would enable him to maintain his action for money paM.

In Ables v. Lee, 6 Tex., 434, it was held that, under a plea of payment, a defendant could not show a sale of land by which one debt was discharged.

In McNeil v. McCamley, 6 Tex., 165, held a check not paid was not evidence of payment. But had it been paid, would it not have been otherwise?

In Robson v. Watts, 11 Tex., 768, “whatever is received by the creditor in satisfaction will be effective as a payment as between the creditor and his debtor.”

In Cartwright v. Jones, 13 Texas, 1, a plea of payment held to be sustained by producing the receipt of plaintiff’s attorney. In arguing, Justice Lipscomb states the more restricted rule as obtaining, “if payment had been made in something else than money, it would have been necessary to state the facts as they existed.” The opinion, in commenting on Wells v. Fairbanks, 5 Tex., 582, says the rule is “ that if a fact be pleaded, the evidence of such fact may be submitted to the jury, although not specially developed in the pleadings by a detail of all the attendant circumstances.”

In Jennings v. Case, 17 Tex., 673, it ivas held “ the giving of a promissory note, which has been assigned to an innocent holder, will be of equal effect with a payment of the money.”

In Morphy v. Garrett, 48 Tex., 249, held, that where it appeared in evidence that a note was only taken as collateral, such fact did not sustain a plea of payment. Quaere, would it not have been otherwise if taken absolutely?

In Life Ins. Co. v. Ray, 50 Tex., 518, held, although an agent ivas prohibited from taking checks in payment of premiums, yet when received and paid, such facts evidenced payment and the company was bound.

From this digest it is evident that the cases and definitions of payment treat of it according to the circumstances as (1) restricted to a literal tender and reception of money; (2) tender and reception of money, or of something representing or taken as money, or bank-notes, checks, bill of exchange,- promissory notes, etc.; and (3) a satisfaction; settling the obligation by a Iona fide transaction, whereby the creditor is satisfied and the debtor released.

Against the last sense of the word, Justice Lipscomb’s remark in Cartwright v. Jones would apply.

The ordinary meaning of the term applies where anything is used in the transaction, which, from the usual course of business, is regarded as equally or approximately with money, measuring values or representing them, whether in the thing accepted or as a mode of payment.

Payment in fact exists when the debt is satisfied, by the tender and acceptance of something valuable received as an equivalent of or as the thing promised; but it is, as stated above, more commonly applied to dealings where money, or something representing it, or taken as such, is used.

The plaintiff’s equity was based upon his alleged payment and discharge of the promissory note he was owing to his vendor. By the general term used in the petition he would' be entitled to show a bona fide transaction between himself and his vendor, such as would commonly be described or included in its meaning. As between Buckley and his creditor anything could have been agreed upon as a satisfaction. A release, however, by the creditor on no, or an inadequate, consideration would be evidence of fraud, and would not affect the rights of the equitable owner of the debt.

In this case “ time checks ” were used in the transaction. The testimony shows that they were taken up by the railroad company on which they were drawn. They were counted as having certain expressed values, and were treated as representing money, or its equivalent. From the information given of the payment, there is testimony tending to show that these checks, which had defined money values, and to the full amount of the debt, were given by’ Buckley, and that the checks, or one of them, was actually cashed, no complaint having been made as to the others, if there were more than one.

We are satisfied that these facts were properly included under the allegation of payment and discharge used in the petition;.and as they tended to prove the allegation, and were competent, the action of the court in admitting the testimony was not error.

It is not to be denied that had the court reached a conclu- . sion otherwise as to the sufficiency of or weight of testimony to the fact, it would not have been disturbed. But the action of the court carries presumption of correctness, and unless the record shows the finding of the court or jury manifestly without or against evidence, it will not be revised.

II. Notice. As to notice, actual or constructive.

It was the duty of the assignee of a non-negotiable note to promptly notify the maker of such transfer. .It is even held that a transfer, save as between the- payee and the indorsee, is not complete until such notice was given. Daniels on Beg. Inst., sec. 742. In this case there is no testimony that such or any notice was given or attempted to be given.

Buckley called on the payee, who by the terms of the note was the creditor, tendered him checks on the railroad; they were taken and change returned; the payee accounted for the absence of the note by saying it was mislaid, and assured Buckley that it “ would not trouble him any more. He would put a release of it on record.” He gave a receipt for the note indorsed on the back of the deed; and the plaintiff, Buckley, testified that he had no notice of the transfer.

We do not regard this as evidence of notice affecting the payment; in fact notice is negatived.

.- III. As to estoppel. The deed of trust described the note as payable to “Peter Basmussen or order,” authorized sale by the trustees, substitution, allowed holder to buy at the sale, and further, that “ the recitals in the conveyance made to the purchaser shall be full evidence of the matters therein contained, and no other proof shall be requisite of request by the holder of said indebtedness to the trustee to enforce this trust, or of the advertisement or sale of any particulars thereof, and all prerequisites of sale shall be presumed to have been performed, and the sale, under the powers herein granted, shall be a perpetual bar against the makers of this trust deed, his heirs and associates.”

The evidence showed that defendants gave $150 for the note after maturity; they had prepared the writings between Rasmussen and Buckley. There was evidence of equivocal conduct by Rasmussen. McDonald, from whom defendants obtained the note, had claimed it. The note had been indorsed to McDonald and the indorsement canceled. There was evidence tending to show that McDonald was the equitable owner of the note. But those claims had never been made known to Buckley, and the facts do not constitute as to him an estoppel. The assignment of a non-negotiable note after maturity passed no right against any defense Buckley could set up against the original payer. The right to order sale was dependent upon the existence of an indebtedness. The debt satisfied, the power ceased. There, is no error requiring reversal and the judgment should be affirmed.

[Opinion delivered June 14, 1880.]

Affirmed.


author: Walker, P. J.

text:
    Q. Garner v. H. Butcher et al.
    (Case No. 2640.)
    1. Payment— Confederate money.—Payment to an agent in Confederate money, where it was being used and passed in business transactions as money, was a valid payment, and an agent to collect could receive such notes in payment unless forbidden by his prin-' cipal,
    2. Principal and agent — Payment,—Payment of a note to an agent in notes of other persons is not binding on the principal in the absence of proof of ratification by him.
    3. Acquiescence.— Silence of the principal from 1861 to 1868, owing to the war and the disturbed state of the country afterwards, he being in a distant state, cannot be regarded as acquiescence in the acts of the agent performed during the war, where the principal repudiates such acts as soon as informed of them. 1
    4. Practice — Parties.—The wife is a proper party to a suit to foreclose the vendor’s lien on a note, given by her husband for land deeded to her, and may properly be included in the decree of foreclosure, but it is error to render judgment against her for the debt, or for costs.

      u. Exception to charge of the court.— An exception to the charge of the court which does not state the point of objection will not be noticed on appeal where no counter charge is asked on the subject, or the ground of objection indicated in the assignment of errors.
    Error from Collin. Tried below before the Hon. Alex. Berry, Special Judge.
    The facts are stated in the opinion.

      Throckmorton db Brown, for plaintiff in error.

      Walton, Green db Bill, for defendant in error.
   Walker, P. J.

This was a suit brought by Q. Garner, the plaintiff in error, against H. Butcher and his wife, on a promissory note given for the unpaid part of the purchase money of two certain tracts of land sold and conveyed by the former to the defendants, to recover the full amount thereof with interest, and to enforce the vendor’s lien on the land. The note was dated March 30, 1861, due twelve months after date, for the sum of §500, payable to G. R. Yantes, as agent of Quarles Garner, the plaintiff, and reciting that it was for the last payment on said tracts of land bought from said plaintiff; it was signed by the defendant II. Butcher. The plaintiff alleged that said tracts of land were sold to said Butcher by his, plaintiff’s, agent, George R. Yantes, and that at the time of the execution of said note, which was made payable to said G. E. Yantes, as agent for petitioner, said Yantes, as agent for the plaintiff, executed and delivered a deed to said land to Malinda Y. Butcher, the wife of defendant H. Butcher; by amended petition plaintiff alleges that the note does not express any rate of interest, and that it has been in the possession of the defendant, so that in the original petition he could not accurately describe it.

Plaintiff alleged that he is the legal and equitable owner of said note; that the indorsement upon the back of the note, as follows: “Received on the within note §400, ¡November 80, 1861. Q. Garner, per G. R. Yantes, agent,” was made by said Yantes upon the receipt by him of certain, promissory notes which were received by him without any authority from the plaintiff, and which never came to the hands of the plaintiff. And he further alleged that the other indorsement was made by some person to plaintiff unknown, who was whplly unauthorized by plaintiff, and that no payment of said note has ever been made to plaintiff or his said agent, Gf. E. Yantes, except the notes paid as aforesaid.

The defendants pleaded a payment made by them of said note to Yantes, by payment of a certain promissory note of $400, on one McWhirter, and the residue of the amount of the note, by payment in Confederate money.

On the trial the note described in the petition with the indorsement of $400 as a credit was introduced in evidence, also a deed to the land, and it was admitted the note was given for a part of the unpaid purchase money of the same. The evidence showed that the land of Garner was sold to Butcher through the agency of Yantes; that the latter took the note payable to himself as agent of the plaintiff. That Yantes retained the note up to and partly during the war. The testimony is conflicting in respect to the disposition which was made of it by Yantes. There was testimony to prove that Yantes received promissory notes to the amount of $400; and, also, that the balance remaining due on the note was paid in Confederate money. There was conflicting testimony as to the payment of the balance of the note in Confederate money. The defendant, Butcher, testified that the note was paid as above- stated and delivered up to him. Yantes testified that he received about $300 or more in promissory notes, Avhich he described by amounts, and the ■ names of their makers, corresponding with receipt of one Patillo, and also some Confederate money, for which he entered a credit of $400. That being garnished by the Confederate States receiver he delivered said note here sued on, together with said notes received in payment and the Confederate money also, to said receiver. He also testified that the plaintiff had never authorized him to receive the notes nor the Confederate money from Butcher, nor did the plaintiff ever receive the notes and Confederate money so paid to witness. That the $400 paid as stated him was the only payment received by him, and that he never saw the note after it was surrendered to the Confederate States receiver until it was produced in this suit. The surrender of the notes, Confederate money, etc., was made December 28, 1861, as per receipt of T. A. Patillo, Confederate States receiver, which was exhibited by the witness, at which time the plaintiff resided in Kansas; and that the surrender was made under a writ of garnishment from the Confederate court at Tyler, served on1 him, requiring him to answer what property he had belonging to alien enemies. Patillo’s receipt was read in evidence by the plaintiff, dated 28th December, 1861, as follows:

“Received of George R, Yantes the following effects belonging to Quarles Garner as shown by his answer, to wit, the sum of $450.10, and also the following notes: One on H. Butcher, $500, credit by $400 — $100; one on J. H. Hardwicke, $36.37; one on J. S. Robinson, $262.50; one on W. B. Blalock, $58.

(Signed) “ T. A. Patillo, Receiver C. S.”

There was testimony concerning an alteration by erasure of indorsements originally made on the note. The indorsement thus alleged to have been erased, witness Craig testified could be discovered by using a glass. It was as follows: “Received on this note $100, February the 4th (or 24th), 1862. T. A. Patillo, C. S. Receiver, by ” (somebody “ agent,” whose name cannot be read). That over these words thus erased was written, “ Paid the within note in full to G. R. Yantes, December 30, 1861.” This conflicting testimony had relation to the disputed fact, whéther the defendant Butcher had paid to Yantes or not the entire amount of the note, or $400 of it only.

It appeared from the evidence that Yantes, up to the time of making the deed of the land to the defendants, was acting as agent for the plaintiff for the sale of the land, and that the transaction was effected through bis agency; that Garner was in correspondence with Yantes as his agent. A letter dated March 10, 1861, to him was read in evidence, the purport of which was to advise with him concerning the terms on which the sale should be made, viz.: To accept Butcher’s offer of $1,000 for the land; to take $500 down and $500 in twelve months, if he could do no better; desiring him, however, to do the best he could for him; and if he had not already sold the land, to take the first-named offer of Butcher, provided it should be well secured by note, with interest from date, “ if he thought best.” The letter discussed the expediency of, and advised with Yantes, as to his sending a check or not, in view of the embarrassed condition of the country arising from the secession of Texas from the Union; or whether it would be best for him to come for the money. Also was mentioned the expediency of taking two mules from Butcher in the trade, and of his coming lor them, etc. The letter then concludes as follows: “I want you to take everything into consideration, and if you think best, take Mr. Butcher’s first offer; if not, take the last offer. Do the best you can. I would like to have the money as soon as possible.”

Yantes testified that he received the first payment in ■money ■—'five hundred dollars specie; that a bill of groceries bought of Butcher may have been settled in that way; that witness had sold plaintiff a horse for $90 or $100, which was .taken<out of the first money. Verdict of the jury “for the plaintiff against the defendants, Butcher and wife, $193.08|-, as balance due on the note given as part payment for land described .in deed from Garner to M. Y. Butcher, it being the principal with interest from maturity of note, and no recourse on Yantes.” ■ Judgment against the defendants, H. Butcher and M. Y, Butcher, for said amount with ten per cent, interest, with decree to enforce the vendor’s lien, with order of sale, execution, etc. The plaintiff moved for a new trial, and, his motion being overruled, appealed to the court .of appeals.

The court in its charge to the jury, among other instructions, instructed the jury as follows, viz.:

Paragraph 5th: “If Yantes gave up the note sued on into the possession of the defendants, Butcher, it is evidence that Yantes considered the debt paid to him, and he then became solely responsible to his principal for the amount due on the note. An agent may do this if he chooses so to do, and become responsible to his principal for the amount, but whether the agent does undertake to do this is a question of fact for the jury, under all the circumstances of the case in proof before you.”

Paragraph 6th: “A principal may commit the whole management of his business without limit to the discretion, of his agent, and if he does so, the honest acts of said agent in the exercise of said discretion are not the subject of revision or correction in any court, but the principal must abide by the acts of his agent in whom he has reposed such special trust and confidence. But whether there was this unlimited committal of the whole business, to the discretion of the agent is a question of fact for the jury.”

The plaintiff excepted to the foregoing instructions, and asked the court to instruct the jury to the effect as follows:

1. That the note being made payable to Yantes as agent of Q. Garner made it the property of the plaintiff, and the defendant, in dealing with said agent in reference to the note, was bound to take notice of the agency.

2. That Yantes could not bind the plaintiff by accepting as payment notes of other persons as payment of the $400 indorsed upon the .note.

3. That if no other payments had been made to Yantes than the notes of other persons, that plaintiff is entitled to recover the amount of the note.

4. “Authority given to Yantes by plaintiff to receive property in part payment for his land when sold, and to do the best he could for him, would not authorize' his agent, after having sold the land and taken a note for the purchase money, to receive in payment of such note, other notes or property. A promissory note in the hands of an agent cannot be discharged by paying to the agent anything but lawful money, unless the owner of the note authorized the agent to receive other than lawful money.” All of which instructions the court refused to give, and the plaintiff excepted, and assigns as error the giving of the charge before recited as instructions given, and the refusal to give the last named instructions, which the plaintiff requested to be submitted to the jury.

The charge of the court embraced in the fifth paragraph above quoted contains a proposition that'is erroneous, and was calculated to influence the jury to an incorrect conclusion upon the issues between the parties. An agent may, it is true, by doing acts in the course of his employment beyond the authority given to him, become responsible to his principal for the amount’of the loss he may have occasioned thereby; but it does not follow that third persons who have dealt with him in the transaction are exempted from liability, or that the unauthorized acts of the agent in the transaction are validated by reason of the agent’s liability to his principal; whether or not they are validated depends upon other considerations than that the agent may have seen proper to transcend his authority, and thereby assume liability to bis principal. “The same general principle pervades all cases of agency, whether general or special; that is, that the principal is bound by all the acts of his agent within the scope of the authority which he holds him out to the world to possess. But when the agent exceeds the scope of his authority, no act of his is binding on his principal. . . . In this respect there is no distinction, whether the authority given to an agent is general or special, express or implied.” McAlpin v. Cassidy, 17 Tex., 462. “ The principal is not bound by the unauthorized acts of his agent, but is bound where the authority is substantially pursued, or so far as it is distinctly pursued.” Story on Agency, sec. 170. The instruction which was given, that the agent might deliver the note to the defendant, and, become solely responsible for the debt, and consider it paid, if he chose to do so, surely was calculated to convey to the jury the idea that such a discretion was within the authority and power of the agent, and if he did do so, that the act, so far as the defendant was concerned, was valid and binding on the principal, and therefore any arrangement or satisfaction made with Yantes would operate to satisfy fro tanto the debt.

The several instructions asked by the plaintiff and refused, may be all considered together. If the first proposition were not exactly and technically correct, nevertheless, in the application of a proper rule of law to the evidence in this case, it may be said to have presented substantially a correct" instruction on the main and leading idea embraced in it. It may not be strictly correct, as an abstract proposition,, to say that in a note payable to A. B., as,agent for 0. D., that A. B. is not the legal owner of it, with right to sue, collect and transfer; but however that may be, abstractly considered, yet the note not only shows on its face that the beneficial interest was apparently in the plaintiff, but as between the parties to this transaction, the evidence shows that they, were all conversant with the rights of the plaintiff to the proceeds of the note, and that it was given for his benefit,' and held in trust for that purpose by the payee.

“ Payment by the maker will be valid as to third persons only when it is bona fide made, without any knowledge of facts which justly impair or destroy the rights of the holder. If, therefore, the maker has notice at the time that the holder has no title to receive the money, and, a fortiori, if he knows that he is receiving it in violation of his known duty and trust, the payment will not be held to be valid or1 obligatory as to the parties really interested.” Story on Prom. Notes, sec. 386.

And so the payment even of a bill of exchange which has been indorsed in blank, made by the acceptor, is not always protected bylaw; but if paid under circumstances which establish a want of good faith on the part of the acceptor, the payment will be nugatory. Story on Bills of Exchange, sec. 416.

Applying this principle of law to the facts of this case, it seems to follow that the maker could not make a payment" to Yantes which would be binding upon Garner, if the payment made was of a character which would be inconsistent with Yantes’ authority as agent to collect the debt. The payment in the notes of other persons was at. the same time a substitution of other obligations for the note of the defendant, and also operated to release, to the extent of the amount thus paid, the plaintiff’s lien upon the land which he had sold to the defendant. The defendant must be held to have known that Yantes was thus accepting such payment in violation of his trust, however well it may have been intended.

The fourth instruction asked by the plaintiff stated the facts of the cases to which it was intended to apply as fully in favor of the defendant as their proper interpretation allowed; there was nothing in the evidence which tended to show that Yantes had greater authority given to him than to collect the note; indeed, there remained nothing more to be done. There was no testimony which tended to show that any authority was given to substitute securities, or to compound or compromise the debt. Therefore, the first proposition and sentence in the fourth instruction is correct. The next proposition in the fourth instruction is not, however, unless qualified. The proposition is, “ that a promissory note in the hands of an agent cannot be discharged by paying to the agent anything but lawful money, unless the owner of the note authorized the agent to receive other than lawful money.” This does not allow the owner to authorize the acceptance of anything else than “ lawful money.” The proper rule, with its limitations, is stated in Rodgers v. Bass, 46 Tex., 506. The result of the discussion there was to hold that, in the absence of special instructions to an agent to collect in gold or silver currency, a payment to the agent, in bank-bills, or other currency generally taken and used in the payment of debts, and current in business transactions as money, would satisfy the debt. Id.

■ The second and third instructions asked by the plaintiff stated correctly the lawT applicable to the case.

The agent has no authority to sell, or barter, or exchange the note to the debtor, or to any one else, for drafts or bills of exchange. Rodgers v. Bass, 46 Tex., 506; McAlpin v. Cassidy, 17 Tex., 450.

“A trustee or agent, with power simply to collect, cannot, in general, receive payment in anything but money. ¡Nor will a payment to him in anything else be binding upon his principal, or operate to discharge the debt, unless made or received by authority of his principal, express or implied. If the debtor pays to a known agent in anything other than money, unless by the authority of the principal, either express or implied from the usual course of business or the" particular usage of trade, the principal may, notwithstanding such payment, recover the amount from the debtor.” Robson v. Watts, 11 Tex., 768. Citing Story on Agency, secs. 430, 98, 181, 413; Chit, on Con., 747.

The sixth paragraph of the charge given by the court states properly a definition of a general agency. The exception to the charge does not state the point of objection to it, nor is a counter-charge on that subject-matter asked by the plaintiff; and we need not notice an assignment which complains simply that the giving it in charge was error, without indicating the ground of objection. It may be remarked, however, that the evidence does not appear to warrant a charge based on the hypothesis that Yantes was a general agent of the plaintiff. The charge was calculated to mislead the jury.

The instructions asked to be given by the plaintiff do not aim, by their terms, to exclude payments which may have been made to Yantes in Confederate money, unless it be implied in the fourth instruction. It has been held by our supreme court that a payment made to an agent in February, 1862, in that species of currency, where the same was being used and passed in business transactions as money, was a valid payment, and that, ordinarily, an agent, to collect, could receive such notes in payment, unless forbidden by his principal. Rodgers v. Bass, 46 Tex., 506.

There is no basis in the petition whereon to support á judgment against the wife, Mrs. M. Y. Batcher, nor for ten per cent, interest on the judgment. The defendants do not complain, however; yet, in view of further proceedings, which must be had, we deem it proper to direct attention to these errors with a view to their avoidance on another trial. The allegations of the petition, as well as the evidence, show that the note was made by H. Butcher only; the wife need not have been a party defendant, unless on account of her apparent right or claim to the land by virtue of the deed made to her; she may be properly included in the decree of foreclosure and sale of the land, but no judgment can properly be rendered against her for the debt nor costs of suit, which must, if enforced at all, be enforced against the community property of her husband and herself. The amended petition alleges that the note sued on does not express any rate of interest; the note offered in evidence does not contain any promise to pay interest; the only obligation to do so is that which the statute regulating interest creates in all written contracts to pay money.

The note, therefore, bears eight per cent, interest from the date of its maturity, and the judgment can bear no higher rate.

It is urged by the counsel for defendant in error thát plaintiff, at all events, ratified the act of Yantes by long acquiescence. There is no evidence of an acquiescence by the plaintiff predicated upon his knowledge of the existence of the facts of the transaction. Yantes testified that the plaintiff never ratified the taking of the notes by him (Yantes), but that he repudiated it as soon as informed of the matter, which was in the year 1868, when he wras in Texas for the first and only time since the war. Suit was brought in Hay of that year. “Long acquiescence, without objection, and even the silence of the principal, will in many cases amount to a conclusive presumption of the ratification of an unauthorized act; especially where such acquiescence is otherwise not to be accounted for; or such silence is either contrary to the duty of the principal, or it has a tendency to mislead the agent.” Story on Agency, sec. 255. The pendency of the war from 1861 until the spring of 1865; the disturbed condition of the country for some time after-wards ; the plaintiff’s residence in a distant state; the legislation and executive action in this state relating to the collection of debts, may hll serve to rebut the inference which might otherwise have arisen# ordinarily, from mere silence.

[Opinion delivered June 20, 1880.]

Under the evidence before the jury, which legitimately might be considered under such a state of facts, without an answer by defendant setting up such a defense, and without any instructions given to the jury based upon that point, we cannot, of course, assume that the jury acted upon or considered that defense; the record does not support the argument. Such an issue does not appear to have been made, nor can it be said to be well supported by the evidence if it had been pleaded.

We are of the opinion that there was error in the judgment of the court below, and that the same ought to be reversed, and the cause remanded for further proceedings; and we shall award accordingly.

Reversed and remanded.


author: Quinan, J.

text:
    The Merchants’ Ins. Co. v. Thomas Dwyer.
    (Case No. 2954.)
    1. Insurance—Application no part of policy.— Where there are no words of reference to the application in the policy it forms no part thereof. If the insurer desires to make it so, he must refer to it, and cannot claim that it is by implication to be treated as a part of the policy. 7 Lans. (N. Y.), 452.
    2. Same — Untrue statement in application.—An.untrue or fraudulent statement on the part of the assured, in his application for the policy of insurance, of a fact material to the risk, does not avoid the policy when either the company or its agent was informed of, and knew the real facts, at the time when the contract was made and the premium paid. Wood on Fire Ins., 277.
    3. Same — Representations as to ownership of the property insured.— The surviving husband, having possession of the community property of himself and deceased wife, with the right of disposition of it for the payment of his own debts, and in the settlement of his business, has an insurable interest therein, and representing himself the owner of it, in taking out a policy-of insurance thereon, was not such a misrepresentation of ownership as would vitiate the policy. Jones v. Jones, 15 Tex., 148; Flanders on Insurance, 281; Wood on Ins., 297, 414.
    4. Same —Expert testimony—Increased risk.— The question of increased risk, in a suit on a policy of fire insurance, is one for the jury, and experts are not permitted to state their c.onclusions upon the issue whether the risk was increased, when that depends upon facts which involve no peculiar science or information, but are within the common knowledge of men. Lyman v. The State Mutual Ins. Co., 14 Allen (Mass.), 329.
    5. Increased risk — Charge oe the court—Waiver.—Where there is a proviso, that, if the risk is increased, the policy is void, it is error for the court to instruct the jury that “if the defendant, by its agents, acting within the scope of their authority, had actual knowledge, notice or reasonable information of the plaintiff having permitted the erection of the ten-pin alley in proximity to the store, and if with such knowledge and information they made no objection thereto, but continued knowingly to earn and receive tlie premium as if the policy were still in full force, or by the conduct of its agents, acting within the scope of their authority, the defendant induced the plaintiff to believe that the said erection of the ten-pin alloy did not, in their view, materially increase the risk or avoid the policy, then the defendant would be estopped and precluded from setting up the avoidance of the policy by reason thereof.” If building the ten-pin alley increased the risk it rendered the policy void, and mere silence on the part of the company, failure to give notice, make objection or return any part of the premium will not constitute a waiver of the forfeiture occasioned by the increased risk. Texas Banking and Insurance Co. v. Hutchins, 53 Tex., 61; Banking Co. v. Stone, 49 Tex., 13; Insurance Co. v. Lacroix, 45 Tex., 170; N. Y. Central Ins. Co. v. Watson, 23 Mich, 486; Hoyet v. Gilman, 8 Mass., 339; Hendricks v. Commercial Ins. Co., 8 Johns., 1; Waters v. Allen, 5 Hill, 424; 99 Mass., 160.
    6. Proof of loss — Waiver.— Where defective proofs have been made, a refusal to pay on special grounds, or a denial of liability, unless predicated upon the defects in the preliminary proofs, is a waiver of all defects therein, and estops the insurer from insisting upon them to defeat his liability. Wood on Ins., 718.
    Appeal from Washington. Tried below before the Hon. I. B. McFarland.
    A statement of the case is given in the opinion. -

      Giddings db Morris and Breedlove db Ewing, for appellant.

      Bayles <& Bassett, for appellee.
   Quinan, J.

The plaintiff below, who is appellee here, brought this suit to recover of the appellant $5,000, amount of a policy of insurance against fire, executed by the defendant, covering a certain stock of goods, belonging to the plaintiff, and stored in their certain buildings, described in the policy.

The policy was issued December 8,1871, and, by its terms, continued in force for one year. It was renewed for another year, December 8, 1872.

On the 27th September, 1873, the insured property was destroyed by fire, and on the 31st August, 1874, suit was instituted to recover the amount alleged to be due on the policy, and at the June term, 1875, judgment was rendered against the company, from which defendant appealed. Its defense was that the plaintiff had avoided the policy, and forfeited the insurance:

1st. By falsely representing in the original application that there was a street on the south side of the building.

2d. By falsely representing that he was the only party interested in the insured property.

3d. That after the last renewal and during its continuance, the plaintiff annulled the policy by permitting the buildings to be occupied by D. A. Allen as a postoffice, whereby the risk was increased.

4th. By permitting a ten-pin alley to be erected on an adjoining lot, whereby the risk to the insured property was increased.

5th. By his failure to make out and deliver to defendant such particular account of the loss and damage as the nature of the case admitted.

6th. That the plaintiff made false statements in his preliminary proofs, which debarred him of a recovery on the policy.

There were some other defenses set up in the answers, but they were waived or withdrawn on the trial.

The assignments of error are numerous, pointing • out errors in the charge of the judge, and objecting to the verdict of the jury as against the evidence and the law.

We will notice the points made in the order in which the defendant has presented them in its defense as stated.

1. The points relating to misrepresentation in Dwyer’s original application for insurance may be answered by stating that the original application for insurance, made by Dwyer and Healey, forms no part of this policy and is not referred to in it. Where there are no words of reference to the application in the policy they form no part thereof. If the insurer desires to make them so he must refer to them, and cannot claim that by implication they are to be treated as a part thereof. 7 Lans. (N. Y.), 452.

2. As to the representation of ownership in the goods insured. The condition indorsed on the back of the policy is, “Property held in trust or on commission must be insured as such, otherwise this policy will not cover such property, and in case of loss the names of the respective owners shall be set forth in the preliminary proofs of such loss, together with their respective interests therein.” The goods were insured as the property of Dwyer. The facts were that when the policy was issued, in December, 1871, Dwyer was a married man, and was then engaged in a large mercantile business. His wife died in September, 1872, so that when the policy was renewed in December, 1872, the goods insured were held by him in common with the three children of his wife, not “ in trust or on commission,” technically, but with the right and power actually being exercised by him to sell and deal with them, and dispose of them in settlement of community debts if such there were. Jones v. Jones, 15 Tex., 148; Flanders on Insurance, 281, and the cases cited in note 1.

The whole stock was valued at $75,000, so that Dwyer had an individual separate insurable interest in the goods largely in excess of the amount insured. There was no written application, on the part of Dwyer, made for this insurance, no questions were asked him, and no representations were made by him. The agent of the company made out the policy and delivered it to him, and the facts of Mrs. Dwyer’s recent death and the condition of the property and its true ownership were well known to the company’s agent. “He was familiar with Dwyer’s family and could not have been ignorant of the facts.” In this state of case we are of opinion that this defense is not available to the defendant, and that Dwyer was not precluded from a recovery on account of this statement of the ownership of the property. If the statement were to be' considered even a false representation or warranty, “the tendency of the later and better cases,” it is said, “ is that when the insurer knows the falsity of the warranty when the contract is made, he cannot avail himself thereof as a defense to an action upon the policy; and it seems to be now very well settled that an untrue or fraudulent statement on the part of the applicant of a fact material to the risk does not avoid the policy when either the company or its agent was informed of and knew the real facts at the time when the contract was made, or the premium paid. And especially is this the case when the agent fills up the application, and, knowing the real facts, misstates them, through mistake or otherwise.” Wood on Fire Insurance, 277, and cases cited.

The rule is that when the agent knows the facts and that there is no intention on the part of the insured to deceive or defraud the insurer, the misstatement of facts by the agent will not avoid the policy. And there is no pretense that there was any improper or sinister motive inducing Dwyer to conceal any fact in relation to the ownership of that property, or that anything was concealed or misrepresented. Wood on Ins., 414.

And again it has been held, “ if the assured has really such an interest or property in the subject-matter of the risk, that calling it ‘his own’ or ‘his’ or ‘my,’ etc., can in any sense be construed as consistent with the truth, the policy will be upheld although the absolute title did not vest in the assured. The test is xvhether the assured had an insurable interest, and stood in such a relation to the property that- it could be in any light regarded as his.” Wood on Ins., 297, and cases cited in note. And we have little doubt that that applies to Dxx'yer’s title to the property. He had possession, with the right of disposition of it, for the payment of his own debts and in the settlement of his business, and unquestionably had an insurable interest in it. As said by Chief Justice Hemphill, in Jones v. Jones, “as survivor he had competent authority to discharge the debts of the partnership, and whether the discharge of the debts, or any act which he might lawfully do as survivor, be done in his own name simply or in his name as survix'or, is immaterial.” Conta v. Connor, at the present term, S. C.

The third ground of defense is that the plaintiff annulled the policy by permitting the buildings to be occupied as a postoffice.

To this we need make no other reply than that the proof is "unquestionable (whether it be admitted that the keeping the postoffice in the building increased the risk or not) that Dwyer took the precaution to obtain the permission of the companies in which he xvas insured for that purpose. He says: “M’Koenig, as agent of the defendant, gave me a

written permit.” And the company had the poxver through its agent to xvaive this increased risk, if such it xvere. Flanders on Ins., 324.

The fourth proposition insisted upon by the defendant, and very strenuously urged, is that by permitting a ten-pin alley to be erected on an adjoining lot, whereby the risk to the insurer was increased, the policy xvas forfeited.

The condition indoisid on the policy is: “If after insurance effected either by original policy or a renexval thereof, the risk shall be increased by any means xvbatever within the control of the insured, . . . such insurance shall be void and of no effect.” By this is meant, of course, a material, substantial increase of risk.

The proof xvith respect to the erection of the ten-pin alley shows that in the spring of 1873 Dwyer leased to O’Meally a piece of ground adjoining the rear part of bis building, for the purpose of erecting a ten-pin alley thereon" and that the alley was erected so that the rear part of it was within eighteen to twenty inches of the rear part of the store house. It was a wooden frame building ninety feet long, and extended along the rear and south side of the Dwyer building eighteen or twenty feet. A diagram of the buildings and .their connection with the Dwyer store was in evidence before the jury.

The defendant offered testimony to show that the erection of this ten-pin alley greatly increased the risk and danger to the insured property.

Burke, an insurance agent, said that the risk would be increased one-half to one per cent.

M’Donald testified that it very materially increased the risk of fire, and that the insurance companies doubled their rates in that locality.

Breedlove, an insurance agent, familiar with insurance business, swears that the ten-pin alley would materially increase the risk and the rate of insurance.

To the same effect is the testimony of Sampson, the secretary of the company, and others.

And Fisher testified that a ten-pin alley properly kept would not be more dangerous than a mercantile establishment.

How, whe-ther the erection of the ten-pin alley, admitting it to have been within the power of Dwyer to prevent it, was an increase of the risk within the meaning of the policy, it is well settled is a question for the jury, and their finding is conclusive thereon. It is not a question of science—it is to be determined as a fact. It is a subject of common observation, upon which the uneducated mind is capable of forming a judgment. And so it is said, in such matters, experts are not permitted to state their conclusions, and the jury are at liberty to disregard their testimony. It has been held that the opinion of underwriters, or the materiality of facts and the effect they would have had upon the premium, is ntit admissible in evidence. 94 U. S., 475. “It is for the jury to say whether, in view of all the circumstances, a reasonably prudent man would have been influenced in taking or declining the risk, or would have charged a higher rate of premium therefor. And in determining this question, they are to say whether, in view of the evidence, the liability of the property to.destruction from the peril insured against was essentially increased.” Wood on Ins., 443, 444.

In Lyman v. The State Mutual Ins. Co., 14 Allen (Mass.), 329, where the policy contained a condition that where the risk should be increased by the act of the insured, the policy should be void, and the contention was whether the risk had been increased by extensive alterations and repairs to the building made by the insured, and experts were examined to that point, the court say: The only remaining question is whether the opinions of witnesses, which were admitted to prove an increase of risk, were competent evidence, and upon consideration we "are unanimously of opinion that they were not. The decision of this point, as presented, requires no extended examination of authorities, for it is quite clear that no witness can be permitted to testify to his own individual opinion, merely upon the issue whether the risk was increased, when that depends upon facts which involve no peculiar science or information, but are within the common knowledge of man.”

And so in Grant v. The Howard Ins. Co., 5 Hill, 16, it was held that it was not for the court to determine whether the risk had been increased, but that the question belonged to the jury. See, also, Stebbins v. The Globe Ins. Co., 2 Hall, 632; New Eng. F. & M. Ins. Co. v. Wetmore, 32 Ill. 245.

And now as this question, whether the erection of the ten-pin alley increased the risk, was one solely for the jury, that it belonged to them to draw the conclusion, risk or no increase of risk, from the facts in evidence before them, and not from the opinions of others; and as under the authorities, the testimony by witnesses who gave their opinion upon the subject was entitled to no controlling consideration, the verdict of the jury against the alleged increase of risk would be held conclusive and ought not to be disturbed by us, however widely we may differ from them in their judgment, unless it can be shown that their verdict might have been the result of other considerations, independent of the mere question of actual increased risk. And this brings us to consider in this connection the charge of the court which is complained of upon the subject of waiver.

The court charged the jury that “if the defendant by its agents, acting within the scope of their authority, had actual knowdedge, notice or reasonable information of the plaintiff having permitted . . . the erection of the ten-pin alley in proximity to the store, and if with such knowledge and information they made no objection thereto, but continued knowingly to earn and retain the premiums, as if the policy were still in full force, or if by the conduct of its agents, acting within the scope of their authority, the defendant induced the plaintiff to believe that the said erection of the ten-pin alley did not in their view materially increase the risk or avoid the policy, then the defendant would be estopped and precluded from setting up the avoidance of the policy by reason thereof.”

Nor we cannot say that the jury were not influenced in their finding by this instruction, and it is very obvious that it is erroneous, atid for these reasons:

I. There was no allegation in the petition or pleas of plaintiff of any waiver of the forfeiture of policy which might result from the increased risk caused by the erection of the ten-pin alley. In Texas B. & Ins. Co. v. Hutchins, 53 Tex., 61, the court say, a waiver, when relied on, must be set up; that it must amount either to an agreement or an estoppel, and that in the latter case the particular acts, representations or conduct that have been relied on and acte'd on shall be “ stated with reasonable certainty.” Banking Co. v. Stone, 49 Tex., 13, and cases cited, p. 16; Insurance Co. v. Lacroix, 45 Tex., 170.

II. There was not the slightest testimony to warrant the giving of it. There is no proof in the record of any act of any sort done or permitted to be done by the company or its agents to alter Dwyer’s position or induce him to believe that the erection of the ten-pin alley was not considered an increase of the risk, and an avoidance of the policy.

III. The contract between .Dwyer and the insurance company (a contract which they had the right to make) was, “that if the risk is increased the policy is void.” This charge in effect adds to that contract a proviso, “if the company make objection.”

IY. The fact of the increased risk rendered the policy ipso facto void. By its terms nothing was required to be said or done by the company to make it so. They were under no obligation to give notice to the insured or return any part of the premium. The clause in the policy which permits its annulment upon return of the premium unearned, and notice given, is an independent section, and has no connection with the provision upon the subject of increased risk. Boatright v. Ætna Ins. Co., 1 Strobhart (S. C.), 281; 99 Mass., 160. By Dwyer’s act, admitting the erection of the ten-pin alley to have been a substantial increase of the risk, he declared the policy to be void, and there was no legal or moral obligation on the company to convey that information to him. The knowledge they had was only the knowledge that their liability was at an end, and that Dwyer had terminated it.

These propositions seem to us to be consonant to reason and are abundantly supported by authority. See N. Y. Central Ins. Co. v. Watson, 23 Mich., 486; Hoyet v. Gilman, 8 Mass., 339; Hendricks v. Commercial Ins. Co., 8 Johns., 1; Waters v. Allen, 5 Hill, 424.

It is not doubted but that the insurance company might have waived the forfeiture of the policy on account of the increased risk; but that waiver must be established by proof of some act on their part, done with full knowledge of, and inconsistent with, the idea of insisting upon the forfeiture. So it is said, “ whenever the insurer, with knowledge of any act of the assured that works a forfeiture, does any act. that shows he recognizes his liability under the policy as an outstanding obligation, as when he accepts a premium for a renewal of the policy or for any increase of risk, the forfeiture is waived and the policy remains operative.” Wood on Ins., 176; 4 Bennett’s Ins. Cases, 790.

But we have been referred to no case, and we think none can be found, where mere silence or non-action on the part of the company, or failure to make objection where the policy, by its terms, imposes no obligation upon them to make objection or give notice, has been held to have the effect of renewing an insurance which had been forfeited, or imposing upon them an obligation against which they have protected themselves by the terms of their contract. They have the right to insist upon its enforcement; and if this should be deemed to operate oppressively upon the assured, the remedy is to make more liberal bargains or assure with those who can extend more liberal terms.

The remaining grounds of defense, which relate to the proofs of loss, have not been insisted upon in the argument, and may be briefly disposed of.

As far as relates to the proof of ownership, we have already considered that. The proofs may not have been formally made out, but they were received without objection, and we think that objection on that account was waived. Flanders on Ins., 566.

There was no fraudulent misstatement or concealment, and so we assume the jury to have found.

Where defective proofs have been made, a refusal to pay on special grounds, or a denial of liability, unless specially predicated upon the defects in the preliminary proofs, is a waiver of all defects therein, and estops the insurer from insisting upon them to defeat his liability. So where no objection is made to the proofs, or if the insurer’s examiner makes an examination of the loss and denies all liability under the policy, in these and the like cases, the insurer is treated as waiving all defects in the preliminary proofs. Wood on Ins., 718, and the numerous cases cited.

[Opinion delivered June 20, 1880.]

For the error indicated in the charge of the judge, we are of' opinion that the judgment should be reversed and the cause remanded, and we so award.

Reversed and remanded.