text:
    LATHAM CO. v. SNELL et al.
    (No. 8155.)
    (Court of Civil Appeals of Texas. Ft. Worth.
    April 10, 1915.)
    1. Action <@=>50 — Paeties <@=*51 — Misjoin-der— Obi ginal Payee of Note.
    In an action by the indorsee of a note, where the answer alleged that the original payee was still the real owner, and that the maker had a good defense against him and prayed that he be joined as defendant,', and that the note be canceled, or if it be found that the indorsee was the owner thereof, that the maker have a judgment against the payee for the amount recovered by the holder, there was no misjoinder of parties or causes of action, after the payee had been brought in.
    [Ed. Note. — Eor other cases, see Action, Cent. Dig. §§ 511-547; Dec. Dig. <g=>50; Parties, Cent. Dig. §§ 77-82; Dec. Dig. <@=>51.]
    2. Sales <@=*398 — Remedies of Buyeb — If baud — Pleading.
    Where the maker of a note pleaded that it was given for the purchase price of a span of mules which the payee represented to be sound in body and suitable for general farm work, and so guaranteed them to be, but that the representations were false, the pleading sufficiently alleged fraud to warrant the giving of an instruction on that issue.
    [Ed. Note. — Eor other cases, see Sales, Cent. Dig. §§ 1137-1139; Dec. Dig. <@=>398.]
    3. Tbial <@=>252 — Ebaud—‘Instructions—Ap-plicability to Evidence.
    Where the maker of a note alleged that it was given for the purchase price of a span of mules sold to him under misrepresentations, a charge that if the jury found for the maker they should award him the difference between the mules as represented, and their actual market value, was erroneous, where there was no evidence as to the actual market value, and the evidence showed that, though the mules were not as represented, they possessed some value.
    [Ed. Note. — Eor other cases, see Trial, Cent. Dig. §§ 505, 596-612; Dec. Dig. <@=>252.]
    4. Ebaud <@=*59 — Measuee of Damages — Sale of Mules.
    The measure of damages for fraud in the sale of a span of mules is the difference in the reasonable market value of the animals, if they had a market value, or if not, their actual value at delivery, and the contract price.
    [Ed. Note. — Eor other cases, see Eraud, Cent. Dig. §§ 60-62, 64; Dec. Dig. <¿*>59.]
    5. Ebaud <@=>50 — Sales of Mules — Bubden of Pboof.
    Where the buyer alleged fraud by the seller in making a sale of mules, the burden is on the buyer to show not only a right to recover damages, but also the amount of such' damages.
    [Ed. Note. — Eor other cases, see Eraud, Cent. Dig. §§ 60-62, 64; Dec. Dig. <S=*50.]
    6. Tbial <@=>253 — Instructions — Ignobtng Issue — Authority of Agent.
    Where the maker of a note alleged that it was given to the payee, a corporation, for the purchase price of a span of mules, which were misrepresented by the payee’s agent who sold them to the maker, and the payee’s pleadings and evidence showed that the mules were the property of the payee’s manager and his brother, and were sold by them individually, not as agents of the corporation, and that the note was made payable to the corporation because it was on a printed form, and its name was through oversight not stricken therefrom, but that it was afterwards indorsed to the real payee without recourse, and by them indorsed to the bank which recovered thereon against the maker, a charge that if the jury found that the payee’s manager, acting for the payee, made the false representations, they should find against the payee, was erroneous as not requiring a finding that the manager was authorized by the payee to make such sale.
    [Ed. Note. — Eor other cases, see Trial, Cent. Dig. §§ 613-623; Dec. Dig. <@=>253.]
    7. Fraud <^=52 — Issues—Evidence—Damages for Misrepresentations.
    Where the maker of a note given for the purchase price of mules, which he alleged were misrepresented to him, did not seek' a rescission of the contract, but only damages, evidence that he offered to return the mules was irrelevant.
    .[Ed. Note. — For other cases, see Fraud, Cent. Dig. § 48; Dee. Dig. <¿*>52.]
    8. Fraud <£=>52 — Evidence — Damages fob Misrepresentations.
    Where the buyer of a span of mules claimed that they had been represented as sound, when in fact they were weak and diseased, evidence that some time after the buyer had left the farm where the mules were kept, a witness saw a mule’s carcass in the pasture, and, which he supposed was one of those mules, but he did not know what caused its death, was inadmissible, since it was not shown clearly that it was one of the mules in question, nor that its death was due to its weakened condition.
    [Ed. Note. — Eor other cases, see Eraud, Cent. Dig. § 48; Dee. Dig. <@=52J
    Appeal from Eastland County Court; C. A. Hill, Judge.
    Action by the First National Bank of Ranger against W. H. Snell, in which the defendant asked that Latham Company and another be made parties defendant. Judgment for the plaintiff against the defendant Snell, and in favor of that defendant against the Lath-am Company, and the Latham Company appeals.
    Judgment as against the Latham Company reversed, and remanded for a new trial.
    Earl Conner, of Eastland, for appellant. D. G. Hunt, of Eastland, for appellees.
   CONNER, C. J.

The First National Bank of Ranger instituted this suit against W. H. Snell in the county court to recover an indebtedness alleged to be due on a promissory note for the sum of $258, bearing interest at the rate of 10 per cent, per annum from its date and executed by said Snell on the 10th day of January, 1911, and maturing in the fall of that year. The plaintiff also sought to foreclose a mortgage lien given to secure the note on two mules and a set of harness- described in the petition. The note was made payable to Latham Company at Eastland, Tex., and indorsed “Latham Co. without recourse.” The plaintiff alleged that it had been transferred to the bank for a valuable consideration on April 26, 1911, by Cox Bros, “without recourse.”

Among other things, the defendant Snell made L. P. Cox, one of the members of the firm of Cox Bros., and the Latham Company parties, alleging that the note had been given to Latham Company for the purchase of a span of mules sold to him by L. P. Cox, acting as the general manager of the Latham Company, and that said Cox, acting as such general manager at the time, represented said mules to be 11 or 12 years old, and to be sound in body and health, and free from disease, and suitable for general farm work, and so guaranteed them to be. The defendant further alleged that said representations were false; that said mules were very old, were diseased and weak, and unable to perform farm work; that in truth the plaintiff in the suit was not the owner of the note declared upon, but that it was owned either by the said Latham Company or by L. P. Cox; and he prayed as against those parties that the note be canceled, but further prayed that if mistaken as to the ownership of the note, and that it should develop that the plaintiff was entitled to recover by reason of the suit thereon, that he have “judgment against Latham Company and L. P. Cox jointly and severally for such amount as the plaintiff may recover, and for all other and further relief which the law and facts may authorize,” etc.

Latham Company answered, urging a number of exceptions to the sufficiency of the pleadings of Snell and also specially denied under oath that L. P. Cox was its agent in the matter of the sale of the mules in question, and alleged that it had no interest or claim to the mules sold to Snell hy L. P. Cox, and .that Cox had no authority whatever to act for it in making representations concerning the quality or soundness of the mules, or in making any warranty with reference to their condition or quality, or in accepting a note for the purchase price of the mules payable to Latham Company.

A trial before a jury resulted in a judgment for the plaintiff, the First National Bank of Ranger, against the defendant W. H. Snell for the amount of the note sued on with interest and attorneys’ fees, as provided for in the note, with a foreclosure of a mortgage lien on the property described in the petition and in the mortgage introduced in evidence. The jury further found a verdict in favor of W. H. Snell against Latham Company for the sum of $200, but found for the defendant L. P. Cox individually, and judgment was rendered in accordance with the verdict.

Latham Company has prosecuted an appeal as against defendant Snell alone, the record not showing any complaint ■ by either Snell or Latham Company of the judgment in favor of the First National Bank of Ranger and of L.-P. Cox.

We think the assignments raising the objection that there was a misjoinder of parties and of causes of action must be overruled. It is to be remembered that the defendant specially pleaded that Latham Company and not the plaintiff, was the real owner of the note, presenting a good defense as against that company. In the interest of avoiding a multiplicity of suits, which is a favored doctrine in equity, we think it was entirely permissible for the defendant to make Latham Company a party as he did, with prayer in the alternative as made. See Love v. Keowne, 58 Tex. 199; Chevalier v. Rusk, Dallam, Dig. 613; Clegg v. Varnell, 18 Tex. 302.

The fourth paragraph of the court’s charge is as follows:

“Upon the issue above stated between W. H. Snell and L. P. Cox, individually, and the corporation of Latham Company, you are charged that should you find by a preponderance of the evidence that L. P. Cbx, acting for the corporation of Latham Company, in the sale of the span of mules to W. H. Snell falsely represented to him, Snell, that the mules in controversy were ten years old, sound animals in body and health, and free from disease and suitable for general farm work, or if you find that said L. P. Cox, acting in the capacity as aforesaid guaranteed and warranted said animals to be sound in body and health and free from disease and suitable for general farm work, and you should further find that said mules were oid, diseased, and worn out and not strong enough to do ordinary farm work, and you should further find that the said W. H. Snell, on ascertaining the real character and kind of animals bought, tendered and offered to return said animals to L. P. Cox, as general manager as aforesaid, and he, Snell, demanded the cancellation of the note executed for them, then and in that event, you will find for the defendant W. II. Snell, and against Latham Company in a sum equal to the difference between the contract price of the said animals and the real value of said animals.”

Objection is made to the paragraph of the charge quoted, on the ground that there was neither pleading nor evidence authorizing the submission of the issue of fraud, the contention being that the case made was one of a breach of warranty only, but we think this contention must be overruled. As alleged, tbe representation and warranty constitute a continuing whole. They were not alleged to be in writing, nor was any specific warranty contained in the bill of sale or mortgage, which it is insisted constituted the contract. Either the fraud shown as alleged, or a breach of the warranty, if any, would as the court charged, authorize a recovery in Snell’s behalf for the legal damages.

The charge instructed the jury, in event of a finding in favor of W. H. Snell on the issues presented, that they should find against Latham Company in favor of Snell “in a sum equal to the difference between the contract price of the said animals and the real value of said animals.” It is objected (and the question is also raised by assignments objecting to the refusal of special instructions giving the proper measure of damages) that there was neither pleading nor evidence authorizing a submission of the measure of damages, and we find this objection to be well taken. Appellant so stated the fact, which is not denied in appellee’s behalf, and which, therefore, under the rules would authorize us to accept the statement as true. Moreover, we have carefully examined the statement of facts, and while we find evidence that the mules were much older than it was alleged that they were represented to be, and that one or both were diseased and weak and not able to do as much work as was expected of them, we find no evidence establishing their market or intrinsic value, or that they were wholly worthless. Appellee, after testifying to the circumstances of his purchase, and that thereafter he hitched the mules to his loaded wagon and started home, further testified:

“When I got about 5 or 6 miles out of East-land one of the mules seemed to give out and both dragged along very slow. They kept this up all the way to the farm, and we arrived at the farm late in the evening, having gone a distance of only about 12 miles. A week or so after this I went over to Gorman with the mules hitched to the wagon, and while there one of them took severely sick and I left the mules in the wagon yard there to be treated by a veterinary. * * * I tried to work the mules during that year in the crop, but they were weak, would not eat their feed, and got down real poor and I could not work them very much. I would say that the mules were not sound, but that they appeared to be all right at the time I looked at them. I relied on what Mr. Oox told me and on the looks of the mules at the time I purchased them. One of the mules was sick the biggest portion of the time. I left the farm some time in September, and left both of the mules there on the place when I left there; have never seen either of them since I left. I could have worked the mare mule more than I did if I had had another mule to work with her. But on account of the horse mule being sick and unable to work the mules all the time, I could not work the mare mule by herself. I had no other team there. My father-in-law had a team. We together had something like 80 or 90 acres in cultivation, and I cultivated about one-half of the place. * * * One of the mules I could not work at all, although both mules seemed to look all right and was in good flesh but would give out from weakness and could not pull a plow for even one-half day. At first and in less than three weeks 1 did not and could not use this mule at all. The other mule was not so bad, but I will say that through the crop season I did not work the best one more than one-third of the time. The mules were old, 19 or 20 years old.”

Mr. Clem, the father-in-law, testified to the effect that the mules were weak, etc., stating that “the mules did not eat, sometimes they would leave their feed in the trough. The pasture was fairly good, but they got poor all the time, especially one of them. There was something like 90 acres that we cultivated in cotton and corn. Snell cultivated about 40 acres. Mr. Snell worked the mules during that year in his crop, but they did not do but about half as much work as they ought to have done.”

There was other testimony but only of like effect. As will be seen from the evidence quoted, it does not appear that the mules were entirely without value and, as before stated, no witness attempted to testify in relation to the value of the mules at any time.

Appellee’s true measure of damage, if any, was the difference in the reasonable market value of the animals, if they had a market value, and if without market value their actual value in their condition at the time of delivery and the contract price.

And the burden was not only upon appellee as against Latham Company to prove the facts necessary to constitute a liability on the part of Latham Company, and a right to recover damages, but also to show the amount of his damages, the amount of his recovery being one of the essential elements of his case. See T. & P. Ry. Co. v. Bigham, 30 S. W. 254; L. & G. N. Ry. Co. v. Simcock, 81 Tex. 503, 17 S. W. 47; Western Union Beef Co. v. Kirchevalle, 26 S. W. 148; Dickerson v. S. A, U. & G. Ry. Co., 170 S. W. 1045.

The fourth paragraph of the court’s charge is further objected to on the ground that it authorized a recovery in behalf of Snell upon a finding that L. P. Cox acted for the corporation of Latham Company in the sale of the span of mules, regardless of whether L. P. Cox was so authorized to act, and the charge seems subject to the criticism. Latham Company duly pleaded that the mules in question did not belong to the company; that the company knew nothing of them, and that L. P. Cox was not authorized in any manner to act for Latham Company, either in the sale of the mules or in the acceptance of the note payable to their order. L. P. Cox testified, in substance, that he and his brother, Boone Cox, were engaged in the mercantile business in Ranger under the firm name of Cox Bros.; that the two mules in question were purchased by Boone Cox in Hamilton county and brought to Ranger by him, but that the mules were later brought to Eastland, where he was acting as general manager for Latham Company, and placed in the Latham Company stock lots, but that the mules were not owned by the Latham Company and never were; that he never told the defendant Snell that Lath-am Company did own the mules. Cox further testified that the defendant Snell’s note had been made upon one of the printed forms of Latham Company, and he had inadvertently failed to erase Latham Company as payee and insert Cox Bros., and that to remedy the oversight he had later indorsed the note in the name of Latham Company without recourse. T. W. Harrison for the Latham Company testified that he was the bookkeeper, secretary-treasurer of the corporation, Latham Company, at Eastland, owning stock in the corporation at the time, and that he remembered the two mules that Cox Bros., had in the Latham Company lot in the town of Eastland; that Cox Bros, carried an account with Latham Company, and that they were charged regularly with tlie cost of tlie feed and care of tlie mules. He testified:

“The charge slip which I have here shows that 6 months Cox Bros, account was charged with feed and care of two mules for 60 days at the rate of 40 cents a day. These mules were never owned by Latham Company, they never had any interest in the mules, and L. 1?. Cox never had any authority to make any binding on Latham Company with reference to their sale or condition. The note sued on was never entered on the Latham Company’s books, and never appeared as an asset of the Latham Company.”

S. J. Day for the Latham Company testified that he attended to the mules together with the other stock at Eastland, fed them night and morning, and that after each feed he “would make a charge slip for the feed and take it in the office to Mr. Harrison to be entered as a charge against Cox Bros, for the care of these mules, and the charge slips which Mr. Harrison had are the original charge slips made at the time, and bear date covering a period of 60 days prior to the sale of the mules.” Jim Hightower for the Latham Company testified:

“I know of the two Cox mules over which a controversy is raised in this case. I hauled cordwood with these mules for about 5 miles north of Eastland for a period of 30 or 40 days. All that I know about the mules is that they pulled over an uneven and hilly road a little over a cord of wood at a time. This is a good pull for a span of mules. They did not seem to be sick or weak, but what I regarded as good strong pullers. They eat hearty and were fat. L. P. Cox paid me for the work I did in hauling wood with these mules.”

In view of the allegations and of the testimony just given, it was particularly important that the charge of the court should, among other things, distinctly impose the burden upon Snell of showing, by a preponderance of proof, that L. P. Cox, in the sale of the mules, was authorized by Latham Company to make the representations alleged.

In view of another trial we wish also to briefly notice several objections to the testimony. On the trial the court permitted the witness W. H. Snell to testify, over the objection of Latham Company, that in a conversation over the phone at the time one of the mules was taken sick at Gorman, he told Mr. Cox of the condition of the mules and offered to return them. This testimony was objected to as irrelevant and immaterial and in the light of the issues made by the pleadings and the evidence it would seem to be so. It is not contended under the circumstances that Snell was entitled to a rescission of the contract, and the court submitted no such issue. The remedy sought and submitted was one for damages, and upon the issue of damage we fail to see the relevancy of the testimony relating to the offer to return.

The witness Jim Hamilton was permitted to testify, over the objection of Lath-am Company, that some time after Snell had left the farm in September or October “I was in the pasture one day and run across a dead carcass, which I supposed was that of one of the mules. I did not know what caused its death, if that was one of the mules, but they were very poor along the last of that fall.” This testimony, of course, was offered as tending to prove the allegations that the mules were weak, diseased, etc., but we think to be admissible for this purpose it should have been shown with a little more clearness that the mule that the witness saw dead was one of 'the mules in question, and that the cause of its death should be pointed out in some such way as to afford a reasonable presumption that its death was attributable to the condition it was in when sold to Snell.

We conclude that for the errors indicated the judgment in favor of W. H. Snell against Latham Company must be reversed, and the cause, as between these parties, remanded for a new trial. As to the other parties, however, the judgment will be undisturbed.
      <@=>For other oases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


source: Caselaw Access Project

author: BUCK, J.

license: Public Domain

text:
    LATHAM CO. v. LOUER BROS.
    (No. 8154.)
    (Court of Civil Appeals of Texas. Ft. Worth.
    April 10, 1915.)
    1. Corporations <@=3673 — Foreign Corporations — Evidence—Doing Business Within the State.
    In an action by a foreign corporation, evidence held to show as a matter of law, that plaintiff was not doing business within the state so as to be required to secure a permit.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 2534, 2535, 2557, 2558, 2650; Dec. Dig. <@=>673.]
    2. Corporations <@=673 — Foreign Corporations — Doing Business Within the State —Permit—Burden oe Proop.
    Where the petition of a foreign corporation shows that it was engaged in business within the state, the burden is on it to show that it had obtained a permit to do business as required by Vernon’s Say les’ Ann. Civ. St. 1914, art. 1318, providing that no foreign corporation can maintain any suit or action, in the state, unless at the time the contract was made or the tort committed, it had filed its articles of incorporation for the purpose of procuring its permit to do business; but where the petition and evidence of the corporation show that it was not doing business in the state, the burden is on the defendant to show that plaintiff was not entitled to maintain the action.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 2534, 2535, 2557, 2558, 2560; Dec. Dig. <@=673. ]
    3. Evidence <@=455 — Parol — Effect in Writing — Explanation of Book Entry-Ambiguous Entry.
    In an action against a corporation on a note, where the defense was payment, and defendant had introduced its books showing that the entry of the note had been marked “Paid,” it was not error to exclude testimony by the bookkeeper as to the meaning of the entry, since it was unambiguous.
    [Ed. Note. — For other cases, see Evidence, Cent. Dig. § 2104; Dec. Dig. <@=455.]

      Appeal from Eastland County Court; E. A. Hill, Judge.
    Action by Louer Bros., a foreign corporation, against the Latham Company. Judgment for the plaintiff, and defendant appeals.
    Affirmed.
    Earl Conner, of Eastland, for appellant. J. T. Hammons and R. L. Rust, both of East-land, for appellee.
   BUCK, J.

Judgment was recovered by plaintiff in a suit upon a note for $166.07, dated Eebruary 7, 1908, and due December 15, 190S, interest at 8 per cent, per annum, alleged to have been executed by the defendant Latham Company in favor of plaintiff. From the judgment in favor of plaintiff for the full amount sued for with interest, the defendant appeals.

Plaintiff alleged in its petition that it was a “private corporation organized under the laws of the state of Illinois, and residing and doing an interstate commerce business, selling and shipping general merchandise in and from Chicago to the state of Texas, and that its headquarters and place of business and offices are in said Chicago, and that it has not, nor never had, any office in Texas, nor place of business in Texas. * * * That the same has been true from long prior to the sale to defendant of the goods, wares, and merchandise for which the note herein sued for was delivered and executed till the present time.” It further alleged that it had not procured a permit from the state of Texas, inasmuch as it was not required so to do under the law.

Defendant pleaded that plaintiff had no lawful right to maintain its suit under the laws of Texas, and prayed that same be dismissed, it being a foreign corporation engaged in and doing business in this state without a permit from this state. It further pleaded payment of the note sued on some time in the month of January, 1909.

The first assignment is directed to the refusal of the court to submit to the jury defendant’s requested instruction, submitting the question of whether or not plaintiff was a foreign corporation and doing business in the state of Texas at the time of the making of the note sued on and of the filing of this suit, and instructing a verdict for defendant in case the jury should find that it was a foreign corporation and doing business in the state at said time. The court instructed the jury that under the law and evidence plaintiff had a right to maintain this action without having procured from the secretary of state permission to do business in the state, and merely submitted the issue of whether payment of the note had been made. Harry B. Louer, secretary and treasurer of Louer Bros., and salesman for the company, testified that the note in question had been given by defendant for merchandise sold and delivered to the defendant, f. o. b. Chicago; that the plaintiff had “never had an office, general office, or headquarters in Texas,” but that plaintiff’s general office and headquarters were at 215 S. Market street, Chicago. He further testified:

“I have personally traveled in Texas, myself, and made my headquarters at San Antonio, but only for a limited time.”

Frank A. Louer, another brother, upon this question testified:

“It (the company) has been represented in Texas by Mr. Louer personally as traveling agent. Plaintiff has never had an office or headquarters in Texas.”

Charles H. Louer, another brother, testified:

“The note was made to Louer Bros, and was in payment for merchandise sold and delivered to the defendant. * * * Our Mr. H. B. Louer has made his headquarters in Texas, when doing business there. This was when acting traveling salesman. The general offices and headquarters are at 215 S. Market street, Chicago.”

This seems to be the only evidence bearing upon this issue, and we believe the court was justified in instructing the jury that the plaintiff was authorized to maintain this suit without securing a permit from the secretary of state. Even though it might be reasonably said, which we question, that the testimony, to the effect, that when H. B. Louer was traveling in Texas he made his headquarters in San Antonio, raises the issue of whether, at that time, the plaintiff was “doing business” in Texas, yet there is nothing to show as to when he so made his headquarters in San Antonio with reference to the time when the goods were sold to defendant, or when the note was executed, or when the suit was filed.

If the pleadings of plaintiff, reasonably construed, would have tended to show that it was doing business in Texas, then the burden of proof would have been on the plaintiff to show that it had complied with the laws of Texas with reference to a foreign corporation doing business in Texas, and the case of Kate Taber v. Interstate Building & Loan Ass’n, 91 Tex. 92, 40 S. W. 954, upon certified questions from this court, opinion by Justice Brown, so holds. But as the petition not only fails to disclose the doing of business in Texas by the plaintiff corporation, but absolutely excludes that idea, we do not believe that the mere allegation in defendant’s answer would put the burden of proof on the plaintiff to establish this defensive matter; and since the testimony affirmatively shows, and practically without controversy, that this was an interstate shipment, we hold the trial court committed no error in refusing to give the special instruction requested by defendant, and in giving the instruction to the effect that plaintiff had the right to maintain its suit, as raised in the second assignment. Article 1318, Vernon’s Say les’ Tex. Oiv. Stat. 1914, provides:

“No such corporation can maintain any suit or action, either legal or equitable, in any of the courts of this state upon any demand, whether arising out of contract or tort, unless at the time such contract was made, or tort committed, the corporation had filed its articles of incorporation under the provisions of this chapter in the office of the secretary of state, for the purpose of procuring its permit.”

This article only applies to foreign corporations that are doing business in this state, and when there is nothing in the petition filed by a foreign corporation from which it can be inferred that it is engaged in business in this state, or that the transaction out of which the cause of action arose took place within the state, it need not show that the plaintiff has a permit to do business ,in this state. The allegation and proof must be made by the defendant. Miller v. Goodman, 15 Tex. Civ. App. 244, 40 S. W. 743; Brin v. Wachusetts Shirt Co., 43 S. W. 295; King y. Monitor Drill Co., 42 Tex. Civ. App. 288, 92 S. W. 1047; Chapman v. Hailwood Cash Reg. Co., 32 Tex. Civ. App. 76, 73 S. W. 969. Since, in the state of plaintiff’s pleadings, we believe that the burden of proof of the plaintiff’s incapacity to maintain its suit was on defendant, and since moreover, the pleadings of plaintiff, as well as the uncontrovert-ed testimony, support the contention that the transaction out of which the execution of this note grew was an interstate one, we overrule the first and second assignments.

In its third assignment objection is urged to the exclusion of certain testimony on the part of O. E. Gannon, a witness for the defendant. This witness testified, by deposition, that he fiad been employed by the defendant company, during the period of maturity of the note sued on, as bookkeeper and cashier and looking after collection's, and paying off all accounts and notes; that he had charge of the records submitted to him for examination, that the notations on the book were in his handwriting. He was then asked the question:

“If you have seen and inspected such entry, please state whether or not such note (the one in question) was paid? And if paid, by whom and about what time?”

He answered:

“Tes; I have examined the bills receivable and payable book of said company. It was during the year 1913. Personally 1 do not remember paying this note, but the records [were?] in my charge at the time and [contain the?] entry marked ‘Paid.’ ”

The defendant offered the further answer of said witness as follows:

“Yes; the entry was marked ‘Paid’ in said book. It indicates that the note was paid, indicates that it was paid by me, and paid by me as agent, as indicated by entry on the books, either in the latter part of 1908 or early part of 1909.”

If the term “paid” had been in any sense ambiguous in the connection in which it was used, then undoubtedly defendant would have been entitled to the explanation from the witness, who had made the entry of its meaning as used by him, but we do not think there is any ambiguity involved, and therefore this assignment is overruled.

The judgment is affirmed.
      <g=For other eases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: HALL, J.

text:
    FARMERS’ STATE BANK OF NEWLIN v. BELL et al.
    (No. 779.)
    (Court of Civil Appeals of Texas. Amarillo.
    May 1, 1915.)
    1. Appeal and Ebbob <@=>797 — Dismissal-Motion — Time.
    Under rule 8 for the Court of Civil Appeals (142 S. W. xi), requiring motions relating to informalities in the manner of bringing the case up, to be filed within 30 days after the transcript is filed, a motion not filed within 30 days, to dismiss a writ of error, on the ground that the petition for the writ was hot filed within 12 months after final judgment, must be dismissed, unless the objection is jurisdictional.
    [Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 3149-3154; Dec. Dig. <@=> 797.]
    2. Appeal and Ebbob <@=>361 — Writ op Er-eoe — Waives op Petition.
    Vernon’s Sayles’ Ann. Civ. St. 1914, art. 2088, provides for petitions for writs of error, and prescribes the requisites. Held that, as the requisites are purely formal, the petition for a writ of error may be waived by the parties.
    [Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 1941-1959; Dec. Dig. <@=> 361.]
    3. Chattel Mortgages <@=>21 — Provisions— Validity.
    A stipulation in a chattel mortgage that it should be security for any other debt due from the mortgagor, not to exceed a specified sum, is valid.
    [Ed. Note. — For other cases, see -Chattel Mortgages, Cent. Dig. §§ 67, 69; Dee. Dig. <@=> 21.]
    4. Chattel Mortgages <@=>176 — Action bob Conversion — Special Findings — General Verdict.
    Defendant made a note, which was transferred to plaintiff for a valuable consideration. Thereafter, to secure another note, defendant executed to plaintiff a chattel mortgage, which was duly registered, which provided that it should be security for any other indebtedness due or to become due from defendant, not exceeding a sum specified. In response to special issues, the jury found that no false representations were made by plaintiff to defendant when he executed the mortgage, though he did not understand that it was to cover any note, except the one for which it was primarily given. The mortgaged property was sold by the mortgagor to other defendants for an amount in excess of that of the note for which it was primarily given, and the proceeds applied to that note. Held that, in a suit by plaintiff for conversion of the property, a general verdict for defendants would not overturn the answers to the special issues, and defendants were liable.
    [Ed. Note. — For other cases, see Ghattel Mortgages, Cent. Dig. §§ 335, 337-339; Dec. Dig. <@=>176.]
    5. Chattel Mortgages <@=>176 — Conversion op Mortgaged Property — Damages—Measure.
    The measure of damages for the conversion of mortgaged property is the market value of the property taken, with legal interest from the date of conversion.
    [Ed. Note. — For other cases, see Chattel Mortgages, Gent. Dig. §§ 335, 337-339; Dec. Dig. <@=>176.]
    Error from Hall County Court; John D. Bird, Judge.
    Action by the Farmers’ State Bank of New-lin against J. M. Bell and others. There was a judgment for defendants, and plaintiff brings error.
    Reversed and remanded.
    Stovall Johnson, of Memphis, for plaintiff in error. W. B. Howard, of Childress, for defendants in error.
   HALL, J.

Defendants in error move this court to dismiss this proceeding upon the ground that the petition for writ of error was not filed until more than 12 months after the final judgment was rendered in the trial court. The record was filed in this court on the 11th day of January, 1915. The motion to dismiss was not filed until April 16, 1915. Rule 8 for the Courts of Civil Appeals (142 S. W. xi) requires that motions relating to informalities in the manner of bringing a case into court shall be filed by the clerk and entered on the motion docket within 30 days after the transcript is filed in this court, otherwise the objection shall be considered as waived, if it can be waived by the party. It follows that, unless the question raised is jurisdictional, defendant in error has waived his right to object.

The motion to dismiss is met by sworn statement made by the attorney for plaintiff in error, which shows that shortly after the bond was filed in the trial court, and within the 12 months, he asked the county clerk of Hall county to prepare the record, and informed the clerk that the application or petition for writ of error had been waived, as well as the issuance of citations to the various defendants in error, It is stated by way of explanation that the clerk was inexperienced, and insisted that she should have a petition for writ of error before preparing the record, and that affiant, in order to satisfy the clerk, made the application, which appears in the record to have been filed too late. The facts stated in this affidavit are uncontroverted. The question then is: Can the filing of a formal petition for writ of error be waived? It is held in Seybold v. Boyd, 14 Tex. 460, that both the petition for writ of error and citation may be waived, either expressly or by appearance of the defendant. The jurisdiction of this court does not attach where it is sought to bring the case here by writ of error until the citation has been served. Garney v. Menefee, 53 Tex. Civ. App. 490, 118 S. W. 1083; Vineyard v. McCombs, 100 Tex. 318, 99 S. W. 544. Although the Seybold decision was based upon the Practice Act of 1846, p. 363 (2 Gammels’ Laws of Texas, p. 1706), we find that under the present law (2 Vernon’s Saylés’ Civil Statutes, art. 2088) the requirements of a petition for writ of error are formal, and in this respect are similar to the requirements provided by article 2091, for the citation. Notwithstanding the decisions of two other states hold that the filing of a petition for writ of error is a necessity, we believe it to be a matter which may be waived, under our practice.

On May 13, 1912, defendant Bell made to defendant Graddy a note for $249.73, due December 1, 1912, providing for interest and attorneys’ fees. Graddy indorsed and transferred this note to plaintiff in error the 1st day of September, 1912, for a valuable consideration. On June 3, 1912, Bell executed and delivered to plaintiff: in error a mortgage upon certain live stock to secure his^ note for $200, of even date therewith, due November 1, 1912. Among other stipulations, this mortgage provides:

“It. is further expressly understood that, in addition to the indebtedness above specified, this mortgage shall cover and be security for any and all other indebtedness due or to become due from the first party to the second party prior to the date of the release of this instrument, by the second party or its assigns, whether the additional indebtedness be evidenced by a note or notes or by open account, whether made to said second party or purchased by it, but which said additional indebtedness not specifically mentioned herein shall not exceed in amount the sum of $-.”

This mortgage was duly registered, and on November 30, 1912, thereafter, defendants Sims and Bruce bought the livestock described in the mortgage.

The case was tried before a jury upon special issues. The answers of the jury to the issues are in effect that the cashier of the bank did not make any false representations to Bell at the time he executed the mortgage, as to its contents, but that-Bell did'not understand that the mortgage was intended to cover any note, except a $200 note. They further found that the proceeds arising from the sale of the mortgaged property were paid upon the $200 note, and that the value of the mortgaged property was $325. The jury then returned a general verdict for the defendants. Defendants’ answer did not allege misrepresentation or fraud. It is settled law in this state that such a stipulation as we have quoted above in a chattel mortgage is valid. Freiberg et al. v. Magale, 70 Tex. 116, 7 S. W. 684. Defendants filed no sworn plea attacking the transfer and in-dorsement of the note. The jury, having been called on to answer specific questions, could not control the judgment by a general finding in favor of defendant, which in effect contradicted the specific findings.

The measure of damages for conversion against each of the purchasers is the market value of the property when taken by him, with legal interest from the date of the conversion.

Reversed and remanded.
      <g=>For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: TALBOT, J.

text:
    MUTUAL LOAN & INVESTMENT CO. v. MATTHEWS.
    (No. 7176.)
    (Court of Civil Appeals of Texas. Dallas.
    April 17, 1915.
    Rehearing Denied May 29, 1915.)
    1.Principal and Agent <§=>47 — Duty op Principal — Statement op Indebtedness to Agent.
    Where a principal refused to give its agent a statement of the amount which it owed him on a certain sale of stock negotiated by him, whereby the agent, being unable to give satisfactory proof to a prospective purchaser of his interest in the note which the buyer of the stock had given to secure the price thereof, lost such prospective sale of his equity in such note, the facts gave rise to no right of action in the arent against the principal.
    LEd. Note. — For other cases, see Principal and Agent, Cent. Dig. §§ 76, 79; Dec. Dig. <§=>47.]
    2. Principal and Agent <§=>82 — Agent’s Compensation — Joint Interest in Notes.
    Where plaintiff agreed to sell stock for the defendant, the contract providing that he should receive “Í5 per cent, commission on all sales made by him in cash or notes as obtained on said sales,” the plaintiff thereby became the joint owner with his principal, to the extent of a 15 per cent, interest, in notes which he took covering the price of stock sold by him.
    [Ed. Note. — For other cases, see Principal and Agent, Cent. Dig. §§ 216-219; Dec. Dig. <§=> 82.]
    3. Trover and Conversion <§=>17 — Acts Constituting.
    Where plaintiff agent agreed to sell stock for the defendant company, and to accept, as compensation, 15 per cent, of the cash or notes which he might secure for such stock, and where he negotiated a sale of such stock, taking notes to cover the purchase price, which the defendant immediately turned over to the company, whose stock had been sold to liquidate its (defendant’s) separate obligation to such company, together with the shares of stock bought, which were hypothecated with the defendant by the buyer of the stock to secure the payment of the notes, the action of the defendant amounted to a conversion of plaintiff’s interest in such notes and security, rendering the defendant personally liable therefor.
    [Ed. Note. — For other cases, see Trover and Conversion, Dec. Dig. <§=>17.]-
    4.Trover and Conversion <§=>50 — Conversion op Notes — Measure op Damages.
    Where plaintiff negotiated a sale of stock for defendant, agreeing to accept as compensation a 15 per cent, interest in the purchase-money notes, and such defendant, the buyer being solvent, transferred such notes to the company, whose stock was sold, in order to liquidate its own debt to such company, the measure of plaintiff’s damage for such conversion of his interest in the notes was 15 per cent, of their face value.
    [Ed. Note. — For other cases, see Trover and Conversion, Cent. Dig. § 266; Dec. Dig. <§=>50.]
    5.Trover and Conversion <§=>22 — Return op Property.
    Where the defendant converted notes, in which plaintiff held a 15 per cent, interest, by transferring them to liquidate its individual debt, the subsequent return of such notes by the transferee did not render the initial act any the less a conversion, or destroy plaintiff’s right of action.
    [Ed. Note. — For other cases, see Trover and Conversion, Cent. Dig. §§ 152-162, 167-169; Dec. Dig. <§=>22J
    6. Trover and Conversion <§=>50 — Conversion op Notes — Judgment.
    Plaintiff negotiated a sale of stock under an agreement that he- was to receive therefor a 15 per cent, interest in the purchase-money notes. His principal took such notes and the stock for which they were given, pledged by the purchaser to secure the notes, and transferred them, to the company whose stock was sold, to liquidate its own indebtedness to such company. Thereafter, upon the insolvency of the purchaser of the stock, the company returned such notes to the defendant, but retained the stock, the value of which largely exceeded plaintiff’s interest in the notes. Plaintiff sued his principal, the transferror of such notes, for their conversion. Held, that judgment for plaintiff for his 15 per cent, interest in the face of the notes, less any credit in favor of the buyer through dealings between such buyer and the plaintiff individually, -was proper.
    [Ed. Note. — For other cases, see Trover and Conversion, Cent. Dig. § 266; Dec. Dig. <§=> 50.]
    7. Trover and Conversion <§=>32 — Action-Pleading.
    In an action for the conversion of notes, where the petition charged that, after the plaintiff delivered to the defendant notes which he had secured from a buyer of stock, in the sale of which he was acting as agent for defendant, to secure the price thereof, such defendant transferred to another two of the notes, together with attached collateral and. dividend agreements, in accordance with its own schemes and plans, and in defraud of plaintiff’s rights, and without his knowledge or consent, to his damage in a certain sum, such allegation, unattack-ed by demurrer, was sufficient to raise the issue that the defendant had thereby converted the notes and the shares of stock, in which plaintiff held a 15 per cent, joint interest as commission, to its own use.
    [Ed. Note. — For other cases, see Trover and Conversion, Cent. Dig. §§ 191-202; Dec. Dig. <§=>32.]
    Appeal from District Court, Dallas County; Kenneth Foree, Judge.

      Action by O. N. Matthews against the Mutual Loan & Investment Company. Judgment for plaintiff, and defendant appeals.
    Reformed and affirmed.
    Cardón, Starling, Carden, Hemphill & Wallace, of Dallas, for appellant. Lawther, Pope & Mays, of Dallas, for appellee.
   TALBOT, J.

On the 19th day of November, 1910, appellee entered into a contract in writing with the appellant, a copartnership composed of W. J. Carden and others, which, omitting immaterial parts, is as follows:

“That O. N. Matthews, of Dallas, Texas, is hereby authorized to sell stock of the Western Casualty & Guaranty Company at twenty ($20.-00) dollars per share, until further notice. It is further understood that O. N. Matthews shall sell said stock for cash or to good, responsible people, qn time, but the last payment must mature by or before November 31, 1911. It is further understood that O. N. Matthews shall receive fifteen (15) per cent, commission on all sales made by him, in cash or notes as obtained on said sales, and shall make no representations in making said sales not authorized by the written .or printed literature emanating from this office.”

Thereafter, in August, 1911, the appellee, acting under and by virtue of said contract sold to Duke Phillips, of Greenville, Tex., 500 shares of stock of the said Western Casualty & Guaranty Company, at $20 per share; the said Phillips executing therefor his three promissory notes, one for $2,500, and two for $3,750 each, payable to the order of the appellant, the Mutual Loan & Investment Company. At the time of the taking of said notes, the appellee, under instructions from the appellant, required Phillips to execute a collateral agreement, whereby the shares of stock so sold were to be held by appellant as security for their payment. Appellee about said time also secured from Phillips, as required by appellant, an agreement providing that certain dividends arising on said stock should be applied as payments on said notes. The said notes and agreements were then, after appellant investigated and satisfied itself of the solvency of the said Phillips, delivered to appellant. Immediately after receiving these notes and the collateral agreements hypothecating the $10,000 worth of stock and all dividends to be declared thereon as security, the appellant, without the knowledge or consent of the appellee, separated the notes and transferred to the Western Casualty & Guaranty Company the two $3,-750 notes, together with the collateral agreements, and retained possession of the $2,500 note without holding any of the security therefor. Matthews had no connection whatever with the Western Casualty & Guaranty Company, and knew nothing whatever of the connection between the Mutual Loan & Investment Company and the Western Casualty & Guaranty Company, and did not know, at the time Phillips executed and delivered the notes and the collateral agreements, that they were to be transferred to the Western Casualty & Guaranty Company. When appellant turned the two $3,750 notes and the collateral and dividend agreements securing them over to the Western Casualty & Guaranty Company, the Western Casualty & Guaranty Company released the defendant of an obligation to the extent of $7,500.

Appellee testified:

“I have sold other stock of the Western Casualty & Guaranty Company for the Mutual Loan & Investment Company. The value of the stock was $20 per share. The Mutual Loan & Investment Company has never paid me any commission on this sale (sale to Phillips). I have requested them to do so. * * * There was a general understanding- that I was to go out and sell this stock and was to receive 15 per cent, commission according to the terms of the written contract. I never agreed or consented for the Mutual Loan & Investment Company to take the stock and the collateral security and attach the same to the two $3,750 notes, thereby securing the said two notes, and turn the said two 'notes over to the Western Casualty & Guaranty Company, leaving the $2,500 note unsecured. Neither did I agree to realize my commission out of the $2,500 note. I had no idea that they would do this. Duke Phillips was financially solvent at the time of the sale of the said stock. I do not know what hA financial condition is now, but I understand that he is not now solvent”

Appellee further testified that, when he turned the notes and collateral agreements over to the appellant, that was all he had to do with the transaction until the time he demanded his commission; that he had always contended that he had a 15 per cent, interest in all three of the notes; and that his understanding was that the stock would be attached to all of Phillips’ notes to secure their payment. In October, 1911, appellee borrowed from the State Bank at Greenville $350, and executed his note therefor with the said Duke Phillips as indorser. At the time of borrowing this money, appellee had an understanding with Phillips and the bank that Phillips was to pay the note when it became due, and that he (appellee) was to give Phillips credit for the amount thereof on the commission appellee was to receive for negotiating the sale of the stock. Appellee then told appellant to give Phillips credit for $350, and the interest which was $5 and .this was done. When appellee’s note to the bank at Greenville matured, Phillips did not pay it, and appellee requested the appellant to erase the credit of $355, which had been given Phillips. This appellant would not do, and, at the time of the trial of this case, the Green-ville bank still held appellee responsible on the note. The $355 mentioned was credited by appellant on the $2,500 executed by Phillips, and at the time of the trial of this case had not been erased. Appellee further testified:

“On or about October 20, 1911, I had an opportunity to sell my equity in the Phillips notes. At that time I thought my equity amounted to $1,145. I thought Phillips would pay the $355 nóte. I went to Mr. Brickel, who was sales manager for the Mutual Loan & Investment Company, and told him that I had an opportunity to sell my interest in this Duke Phillips sale, and asked him to give me a written statement showing that I had $1,145 coming to me; and he said that, while I had such interest, he could not give me such statement, because it was not safe. He said that the company might get involved’ in the matter, if he should give such statement. Being unable to get the statement, I was unable to sell my equity. I was intending to sell this equity to Mr. O. D. Caldwell.”.

The shares of stock purchased by Duke Phillips had not in fact been issued when his notes therefor and the collateral agreements were executed and delivered to appellant. The parties, however, dealt with each other, and the transaction in question was consummated as though the stock had been issued; and, when Phillips’ notes and said agreements were delivered to the Western Casualty & Guaranty Company, that company issued the 500 shares of stock and attached them to the two $3,750 notes and held said notes as its property and the shares of stock as collateral security for their payment. This was in accordance with the contract and agreement which existed between the appel-lee and said company. The Western Casualty & Guaranty Company retained the dividends which were earned by the stock and delivered no part of the same to either Phillips, the appellant, or to appellee. Phillips became absolutely insolvent and failed to pay either of the notes given by him for the stock or any part of them. After demand therefor and the refusal of appellant to pay his commission, appellee instituted this suit, and Phillips being insolvent, and failing to pay the two $3,760 notes held by the Western Casualty & Guaranty Company, that company charged the amount of said two notes back to the appellant, returned to it said notes and the collateral agreements, but retained the shares of 'stock.

Appellee’s petition charges, in substance, that the defendants had wrongfully converted the Duke Phillips notes and security attached thereto to their own use, and without his knowledge and consent, and in fraud of his rights, and in accordance with their own schemes and plans had transferred said notes and security, to his damage in the sum of $1,-500, and. by separate count alleging that he had been damaged by reason of the failure of the defendant to give him a statement of his interest in the notes or of his equity in the notes when he had an opportunity to sell his equity therein, and praying for a judgment for $1,500 and interest. Appellee further alleged that, by reason of the sale, he became entitled to his commission of $1,500 either in cash or notes under the terms of the contract.

The defendant answered with general and special demurrers, and admitted that appel-lee had entered into the contract pleaded by him and had made such sale and procured said notes, but set forth that appellant was, by virtue of other verbal agreements alleged to have been made by them with the appellee, to receive his commission out of the $2,500 note, which was to be an unsecured note. Defendant further alleged that plaintiff was well acquainted with their relations to the Western Casualty & Guaranty Company, and that he agreed to the transfer by the defendants of the two $3,760 notes and the collateral to the Western Casualty & Guaranty Company. At the time the case was tried, the notes were past due, and Phillips was insolvent. Appellant contended that appellee simply had an interest to the extent of his commissions in the $2,600 note, but during the trial agreed that appellee might have a judgment establishing his interest of 15 per cent, in all the notes. Such a judgment ap-pellee refused, and insisted that he have a money judgment for the amount of his commissions.

The case was submitted to the jury on special issues, and their findings were: (1) That appellee, under the contract with appellants, was to have his commission interest in all the notes; (2) that appellee’s commission was earned and due when the notes of Phillips were accepted by appellants; (3) that appel-lee did not understand and agree that the two $3,750 notes and their security should be delivered by appellant to the Western Casualty & Guaranty Company to be held by that company until said notes were paid; (4) that, by the action of the appellants, appellee was prevented from negotiating his interest in any of said notes; and (5) that the written contract was the only agreement made at the time.

Upon the return of these findings by the jury, judgment was entered in favor of the appellee against appellants for the sum of $1,697, being the sum of $1,500, with interest added. Erom this judgment, the appellants prosecute this appeal.

Appellant’s assignments of error need not be stated and discussed seriatim. The propositions contended for are, in substance: (1) That in view of the undisputed evidence and findings of the jury to the effect that the written contract in evidence was the only contract between the parties, and that ap-pellee’s commission interest under the terms of said contract was in all the notes executed and delivered by Duke Phillips, and that said interest was created and became vested when the notes were accepted, and that appellee did not agree for the two $3,750 notes, with the collateral security given to secure their payment, to be transferred by appellants to the Western Casualty & Guaranty Company, the only proper judgment that could be rendered was one in favor of appellee establishing his interest of 15 per cent, in all of said notes; (2) that the refusal of appellants to give appellee, upon his request, a statement in writing showing that appellee had an interest of 15 per cent, in the notes executed by Duke Phillips, whereoy appellee was prevented from making a sale of such interest to C. B. Caldwell, gave appellee no cause of action against appellants for the damages alleged to have been sustained by him as a result of such refusal, and hence such conduct on the part of appellants furnished no basis for the judgment rendered.

Addressing ourselves to these propositions in inverse order, we do not hesitate to say that we think the second correct. The appellants were under no legal duty to give the statement requested by appellee; and even though he may have lost an opportunity to sell his interest in the notes in question and suffered damages in consequence of the refusal to give it, yet no right of action, either in law or equity, arose for the recovery of such damages. No contractual duty rested upon appellants to give the statement, and their action in refusing it cannot be classed as tortious. It therefore follows that a suit for the damages, flowing from such conduct, cannot be maintained.

The first proposition is fraught with more difficulty, but we have reached the conclusion that it should not be sustained. We do not think appellee, under the terms of his contract, had a money demand against appellants for his commission upon the acceptance of the notes executed by Phillips. On the contrary, we think the terms of his contract' are unambiguous and clearly show that in tbe event be took tbe notes of a purchaser for stock sold, which were accepted by appellants, he and appellants became the joint owners of such notes; his interest therein being measured by the amount of the commission he was to receive for his services in making the sale. In the transaction with Duke Phillips, out of which this litigation grows, notes were taken for the entire contract price for the stock sold to him, and ap-pellee became the owner of a 15 per cent, interest in all of said notes, with all the rights of such owner to have the shares of stock, which were hypothecated with appellant by Duke Phillips to secure the payment of said notes, preserved and appropriated, so far as necessary for that purpose, to the payment of appellee’s interest therein. But appellants, without the consent of appellee and without his knowledge that it was going to be done, transferred the two $3,750 notes, together with said security, without any reservation whatever of appellee’s interest in said notes and security, to the Western Casualty & Guaranty Company to liquidate pro tanto an indebtedness due by them to that company. This was, we think, such a wrongful conversion of appellee’s interest in said notes and security as rendered appellants liable to him personally therefor. Appellants being so liable at the date of the institution of this suit, appellee, under the pleadings and evidence, was entitled to a money judgment against them for the amount of the interest he then had in said notes. Phillips was solvent when appellants transferred the notes to the Western Casualty & Guaranty Company, but subsequently, and before the trial of this case, became insolvent, and the measure of damages in such case is the amount prima facie due on the face of said notes. Ramsey v. Hurley, 72 Tex. 200, 12 S. W. 56. The fact that the notes transferred to the Western Casualty & Guaranty Company were subsequently returned to appellants does not alter the case. They were not returned until after the insolvency of Phillips and the institution of this suit, and the shares of stock hypoth-ecated to secure the payment of said notes and the $2,500 note heretofore mentioned, and which were when so hypothecated, and also at thé time of the trial of this ease, worth $20 per share, were not returned, but were retained by the Western Casualty & Guaranty Company. It is a well-established principle of law that, when a man’s personal property has been wrongfully converted by another, the wrongdoer cannot escape liability for the value of the property by offering to return it, but the injured party may have his action against him for the value thereof. This principle is applicable here, but whether it is or not the conversion by appellants of the collateral security given for the payment of the notes in question, the value of which was largely in excess of ap-pellee’s interest in said notes, entitled appel-lee, under the findings of the jury and undisputed evidence, to a judgment for such interest. The interest, however, of appellee, in the notes, at the time of the trial, was less than the amount of the judgment rendered. The undisputed evidence shows that appel-lee, upon his note indorsed by Duke Phillips, borrowed from the State Bank at Greenville $350; that, at the time this money was so obtained, appellee agreed with Phillips, evidently in consideration of his indorsement, to give him credit for such amount on his commission interest in the notes executed by Phillips for the stock purchased by Phillips; and that such credit, together with the additional sum of $5, as interest, and at the instance of appellee, was indorsed by appellants on the $2,500 note. This reduced the interest of appellee in said notes $355, and judgment should have been rendered in his favor for the amount of his original interest, less the said $355. The fact that Phillips failed or refused to pay the note to the Greenville bank according to the understanding between him and appellee did not give appellee the right over the protest of appellants, especially without Phillips’ consent, to erase or have erased the credit of $355 which had been given Phillips on his notes. This error in the judgment of the lower court does not, however, require a reversal of the ease, but it may be cured by a reformation of said judgment in this court.

The contention that the issue of conversion of the notes and security for their payments was eliminated by the action of the court in sustaining a demurrer urged by appellants to the seventeenth paragraph of appellee’s petition is not, we think, supported by the record. In the twenty-eighth paragraph of his petition appellee charges, among other things:

“That he verily believes, and so alleges, that the said defendant, shortly after the three notes were delivered to it, transferred two of the said notes, together with the attached collateral and dividend agreements to other persons, in accordance with their own schemes and plans and in fraud of plaintiff’s rights, and without his knowledge or consent, to his damage in the sum of $1,500, with interest at the rate of 6 per cent, per annum from 28th of August, 1911.”

No demurrer was leveled at this paragraph of the petition, and it was sufficient to raise the issue that appellants had converted the two $3,750 notes and the shares of stock in question to their own use.

The judgment of the district court will be reformed by deducting therefrom the sum of $355, erroneously included therein, as above indicated, and, as reformed, will be affirmed.
      <g=>For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: DUNKLIN, J.

text:
    STATE v. CAGE.
    (No. 8145.)
    (Court of Civil Appeals of Texas. Ft. Worth.
    April 24, 1915.
    Rehearing Denied May 22, 1915.)
    1. Taxation <&wkey;3l7 — Assessment of Taxes— Powees oe Assessor.
    An assessor has only the powers expressly given by statute.
    [Ed. Note. — For other cases, see Taxation, Cent. Dig. §§ 525, 526; Dec. Dig. &wkey;317.]
    2. Taxation <&wkey;362 — Assessment oe Taxes— Powers oe Assessor.
    A general statute, requiring the assessment of property for taxation, relates to current years only, and does not authorize assessments for prior years when other assessors were in office, but special statutes expressly giving such authority are necessary.
    [Ed. Note. — For other cases, see Taxation, Cent. Dig. § 601; Dec. Dig. &wkey;362.]
    3. Taxation <&wkey;586 — Enforcement oe Taxes — Statutory Provisions — Construction.
    Under Vernon’s Sayles’ Ann. Civ. St. 1914, art. 7661, providing that no suit shall be brought for taxes until after demand by the collector, a right of action does not exist without an assessment, for a tax collector cannot make a lawful demand until the amount of the tax has been determined by an assessment.
    [Ed. Note. — For other cases, see Taxation, Cent. Dig. §§ 1192-1195; Dec. Dig. &wkey;586.]
    4. Taxation <&wkey;327 — Collection of Taxes— Statutes.
    Vernon’s Sayles’ Ann. Civ. St. 1914, art. 7566, authorizing an assessor to assess omitted property for the years omitted, is not impliedly repealed by article 7661, authorizing actions for taxes after demand made by the collector, which merely relates to the collection of taxes without extending the power of assessors to assess delinquent personal property for omitted years.
    [Ed. Note. — For other cases, see Taxation, Cent. Dig. § 550; Dec. Dig. &wkey;»327.]
    5. Taxation <&wkey;40 — Assessment — Equality and Uniformity — Constitutional Provisions.
    Vernon’s Sayles’ Ann. Civ. St. 1914, art. 7566, providing that any personalty which has not been assessed for taxation every year for two years past may be placed on the list and assessed as other property is assessed, though construed as limiting the power of the assessor to assess personal property which has been omitted for two years prior to his discovery of the omission, is not violative of Const, art. 8, § 1, providing that taxation shall be equal and uniform, though under article 7702 omitted real property may be assessed for any year or years since 1884, since article 7566 does not exempt personal property from taxation nor make any discrimination in its favor, either in the rate of 'taxation or in the mode of its assessment.
    [Ed. Note.' — For other cases, see Taxation, Cent. Dig. §§ 68-89; Dec. Dig. &wkey;40.]
    6. Constitutional Daw <&wkey;42 — Statutes— ' Validity — Rigiit to Question.
    Under the rule that only those against whom a discrimination is made by statute can invoke the benefit of the Constitution, forbidding discrimination, the state may not assail the validity of Rev. St. art. 7566, authorizing the assessment of omitted personal property, because discriminatory as against owners of real estate.
    [Ed. Note. — For other cases, see Constitutional Law, Cent. Dig. §§ 39, 40; Dec. Dig. <&wkey;> 42.]
    7. Taxation <&wkey;195 — Omitted Personal Property — Statutes — Validity — “Exemption of Property from Taxation” — “Extinguishment of Indebtedness for Taxes.”
    Vemon’s Sayles’ Ann. Civ. St. 1914, art. 7566, authorizing the taxation of personal property which has been omitted for two years past, is not within the Constitution, prohibiting the Legislature from releasing or exempting property from taxation, or extinguishing any indebtedness owing by an individual or corporation to the state or other municipal corporation, for a failure of the Legislature to enact laws necessary to collect delinquent taxes for years beyond the specified period is in no proper sense an exemption of property from taxation nor an ex-tinguishment of indebtedness for taxes.
    [Ed. Note. — For other cases, see Taxation, Cent. Dig. §§ 312, 313; Dec. Dig. &wkey;195.
    For other definitions, see Words and Phrases, First and Second Series, Exemption.]
    8. Taxation <&wkey;592 — Enforcement—Actions —Pleading.
    In an action by the county attorney in the name of the state for state, county, and independent school district taxes, defendant may not rely on want of authority to institute the suit because not authorized by the commissioners’ court of the county, where he filed no verified plea denying the allegation in the petition of authorization and offered no proof denying it.
    [Ed. Note. — For other cases, see Taxation, Cent. Dig. §§ 1205-1213; Dec. Dig. &wkey;592.]
    Appeal from District Court, Erath County; W. J. Oxford, Judge.
    Action by the State of Texas against Mrs. Janie Cage, community survivor of the estate of J. H. Cage, deceased. From a judgment granting insufficient relief, the State appeals, and defendant presents a cross-assignment.
    Affirmed.
    Keith & Johnson, of Stephenville, and E. E. Gaines, of Austin, for the State. Chandler & Pannill, of Stephenville, and Stephens & Miller, of Ft. Worth, for appellee.
   DUNKLIN, J.

J. H. Cage, a resident citizen of Erath county, died intestate on August 18, 1912. He had resided in that county and in what is known as the “Stephen-ville independent school district” for 25 years next preceding the date of his death. His surviving wife, Mrs. Janie Cage, qualified as administratrix of the community estate of herself and her said husband. This suit was instituted by the county attorney of Erath county, in the name of the state of Texas, against Mrs. Cage, as such adminis-tratrix, 'to recover taxes alleged to have been due and owing by the deceased from the years 1899 to 1912, inclusive; the taxes so alleged being in favor of the state of Texas, Erath county, and the Stephenville independent school district. The items of property upon which taxes were claimed were amounts on deposit in bank in favor of the deceased on the 1st day of January of each of the years mentioned, which he was entitled to withdraw in money on demand. The trial was before a jury, who returned special findings showing the amount of money to the credit of the deceased in bank upon each of those dates. Judgment was rendered for taxes on the amounts of such deposits on the 1st days of January of the years 1910, 1911. and 1912; the judgment being in favor of the state, county, and independent' school district in separate amounts, and denying a recovery for taxes claimed for the other years mentioned. From the judgment refusing the demands for taxes for other years, the state has appealed.

The evidence shows that the amount of bank deposits mentioned above was not assessed until in the year 1912, when the tax assessor assessed it as unrendered property for each and all of those years. It was agreed between the parties that the.taxes were duly and legally levied by the proper authorities in favor of the state, county, and school district for each and every year as1 alleged in plaintiff's petition, and in the amounts and at the rates as therein alleged.

It is apparent that the trial court refused to allow a recovery for taxes claimed for the years preceding the year 1910, by reason of the conclusion reached that the tax assessor had no legal authority to make assessments for those years, and the contention that the court erred in that conclusion is the only question presented for our determination.

Article 7566 of Vernon’s Say les’ Texas Civil Statutes reads as follows:

“If the assessor of taxes shall discover in his county * * * or, outside of his county hut belonging to a resident of the county, any personal property which has not been assessed or rendered for taxation every year for two years past, he shall list and assess the same for each and every year thus omitted which' it has belonged to said resident, in the manner prescribed for assessing other property; and such assessment shall be as valid and binding as though it had been rendered by the owner thereof.”

Article 7661 reads:

“Hereafter it shall be the duty of the district or county attorney of the respective counties of this state, by order of the commissioners’ court, to institute suit in the name of the state for the recovery of all money due the state and county as taxes due and unpaid on unrendered personal property; and, in all suits where judgments are obtained under this act, the person owning the property on which there are taxes due the state and county shall be liable for all costs; provided, such suits may be brought for all taxes * * * due and unpaid for which such delinquent taxpayer may be in arrears for and since the year 1886; and provided, further, the state and county shall be exempt from liability for any cost growing out of such action; provided, all suits brought.under this article for the recovery of taxes due on personal property shall be brought against the person or persons who owned the property at the time such property should have been listed or assessed for taxation; provided, that no suit shall be brought until after demand is made by the collector for taxes due; and provided, further, that no suit shall be brought for an 'amount less than twenty-five dollars.”-

Article 7566 was enacted in 1887, while article 7661 was enacted in 1888.

Appellant presents, substantially, the following propositions:

First. By article 7566 two years prior to its enactment is fixed as the date to which all future assessments of omitted personal property can extend; and to so construe that article would harmonize it with article 7702, making real estate assessable for all delinquent taxes accruing thereon since the year 1884. And in this connection it is suggested that the latter article, enacted in 1905, by implication repeals article 7565 enacted in 1888, fixing the year 1870 as the date to which assessments of omitted real property could extend.

Second. As article 7661 makes it the duty of the district or county attorney of the respective counties of the state, by order of the commissioners’ court, to institute suit for taxes due and unpaid on personal property unrendered since the year 1886, the right of action is there conferred without an assessment, or else contemplates an assessment to be then made, and thus by implication repeals article 7566 in so far as the latter article limits assessments for omitted personal property to two years next preceding the assessments. And in this connection appellant cites article 7662, passed in 1895, which reads:

“No delinquent taxpayer shall have the right to plead in any court or in any manner rely upon any statute of limitation by way of defense against the payment of any taxes due from him or her either to the state or any county, city or town.”

Third. If article 7566 limits the period for which omitted personal property may be assessed to two years next preceding the assessment, and if that article is not repealed by the later acts referred to already, then the limitation so fixed by article 7566 would be in violation of section 1 of article 8 of the Constitution of the state, which provides that “taxation shall be equal and uniform,” because it is a discrimination in favor of the owners of personal property and against the owners of real estate, in that by article 7702 omitted real property may be assessed for any year or years since 1884.

Fourth. If by article 7566 the period for which omitted personal property may be assessed is limited to the period of two years next preceding the assessment, then the same operates to release the owners of such property from the payment of taxes contrary to, and in violation of, the following provisions of our state Constitution:

Section 55, art. 3: “The Legislature shall have no power to release or extinguish, or to authorize the releasing or extinguishing, in whole or in part, the indebtedness, liability or obligation of any incorporation or individual, to this state, or to any county or other municipal corporation therein.”
Section 2, art. 8: “And all laws exempting property from taxation, other than the property above mentioned, shall be void.”
Section 5, art. 8: “All property of railroad companies, of whatever description, lying or being within the limits of any city or incorporated town within this state, shall bear its proportionate share of municipal taxation; and, if any such property shall not have been heretofore rendered, the authorities of the city or town, within which it lies, shall have power to require its rendition, and collect the usual municipal tax thereon, as on other property lying within said municipality.”
Section 10, art. 8: “The Legislature shall have no power to release the inhabitants of, or property in, any county, city or town, from the payment of taxes levied for state or county purposes, unless in case of great public calamity in any such county, city or town, when such release may be made by a vote of two-thirds of each house of the Legislature.”

It seems to be. well settled that an assessor of taxes has only such powers as are expressly given by statute; that general statutes requiring assessment of property for taxation relate to current years only; and that, in order to authorize assessments for prior years when other assessors were in office, special statutes are required expressly giving such authority. State ex rel. Ferguson v. Howard, 80 Ind. 466; Pierson v. Minnehaha County, 28 S. D. 534, 134 N. W. 212, 38 L. R. A. (N. S.) 261, and authorities there cited.

In the case of Connell v. State, 55 S. W. 980, as well as in other cases there cited, and also in State of Texas v. Trilling, 62 S. W. 788, it was held that:

“No right of action exists for the nonpayment of an ad valorem property tax until an assessment has been made as provided by law.”

And we are cited to no authority holding a contrary view. The Constitution of our state provides for the election of a tax assessor, hut it does not define his duties or powers, and it cannot be questioned that he has such powers only as are conferred by our statutes.

The provision in article 7661 “that no suit shall he brought until after demand is made by the collector for taxes due” necessarily destroys the contention that by that article a right of action exists without an assessment, because the tax collector could not make a lawful demand for taxes due until the amount of such taxes has been first determined by an assessment, of the property for taxation. We are of the opinion further that that article cannot be construed as impliedly authorizing an assessor to assess personal property for any year back to the year 18S6, for, if it is so construed, it would repeal by implication, or else render useless, article 7566. It is a familiar rule that repeals by implication are not favored, and in our opinion article 7661 in no manner suggests that the Legislature in enacting it intended to repeal article 7566, which was then on the statute book and later was embodied in our Revised Statutes. We are of the opinion further that it would be a strained construction of article 7661 to say that in enacting it the Legislature intended thereby to extend the power of the assessor to assess delinquent personal property back to the year 1886. Our construction of article 7661 is that no more was intended than that suit should be instituted for collection of such delinquent taxes only as had been properly levied and assessed.

We think it clear that by article 7566 it was intended that at any time after the enactment of that statute the assessor could assess such personal property which had been omitted for two years prior to the time the assessor discovers such omission, and we-overrule appellant’s contention that by that article two years prior to its enactment was-made the period to which all assessments of' personal property thereafter made could extend.

In support of the contention that, if article 7566 is to be construed as limiting the period of time for which omitted personal property can be assessed, then the same would be in violation of the constitutional provision that “taxation shall be equal and uniform,” the case of Gilman v. City of Sheboygan, by the Supreme Court of the United States, reported in 2 Black, 510, 17 L. Ed. 305, is cited. In that case it was held that a tax which was levied exclusively upon real estate was a discrimination in favor of personal property, and therefore unconstitutional. Appellant cites, also, the ease of Exchange Nat. Bank of Columbus v. Hines, 3 Ohio St. 1, in which the following language is used:

“ ‘Taxing’ is required to be ‘by a uniform rule’; that is, by one and the same unvarying standard. Taxing by a uniform rule requires uniformity, not only in the rate of taxation, but also uniformity in the mode of the assessment upon the taxable valuation. Uniformity in taxing implies equality in the burden of taxation; and this equality of burden cannot exist without uniformity in the mode of the assessment, as well as in the rate of taxation. But this is not all. The uniformity must be coextensive with the territory to which it applies. If a state tax, * * ■ * it must be uniform throughout the extent of the territory to which it is applicable. But the uniformity in the rule required by the Constitution does not stop here. It must be extended to all property subject to taxation,, so that all property may be taxed alike, equally —which is taxing by a uniform rule.”

Neither of these decisions support the contention last suggested, since article 7566 does not purport to exempt personal property from taxation, nor does it appear, that there is any discrimination in favor of personal property either in the rate of taxation, or in the mode of its assessment. The fact that the Legislature has seen proper to fix different periods of time for such assessments of real and personal property does not, in our opinion, render article 7566 inimical to the constitutional provision last mentioned. It is proverbial that exact uniformity in taxation as a practical proposition is impossible of attainment, and the extreme difficulty of tracing the ownership of personal property for a long period of time prior to an assessment, in contrast with the ease and certainty of assessments on omitted real property, in connection with other circumstances that might be mentioned, shows that the distinction made in favor of personal property is not an arbitrary one, but has a reasonable basis, and is as well justified as is the distinction made in our statutes of limitation fixing different periods for suits of different kinds. Florida Cent., etc., Ry. Co. v. Reynolds, 163 U. S. 471, 22 Sup. Ct. 176, 46 L. Ed. 283; 4 Encyc. U. S. Sup. Ct. Reports, page 394, and other decisions there cited.

But, aside from the reasoning thus advanced, it is clear that the state is in no position to invoke that constitutional provision, since the discrimination, if any, made by the statutes, was not against the state, but was against the owners of real estate. It is a familiar rule that only those against whom a discrimination is made by statute can invoke the benefit of the Constitution forbidding such discrimination. See 8 Cyc. 791; Smiley v. Kansas, 196 U. S. 447, 25 Sup. Ct. 289, 49 L. Ed. 546; 6 Ruling Case Law, §§ 87-90, and decisions there cited.

We are of the opinion further that the failure of the Legislature to require assessments of omitted personal property for a period beyond “two years past” is not in violation of the articles of the Constitution quoted above, in effect, prohibiting the Legislature from releasing or exempting property from taxation or extinguishing the indebtedness owing by an individual or corporation to the state, or other municipal corporation. The Legislature could have extended the periods of time for assessments of omitted real or personal property beyond the periods fixed by the statute, but it has not seen proper so to do. The situation presented is, simply, that the Legislature has failed to enact laws necessary to collect delinquent taxes for years beyond certain periods ; and such failure is in no proper sense an exemption of property from taxation nor of extinguishment of indebtedness for taxes.

By cross-assignment appellee contends that the court erred in rendering judgment-in favor of the Stephenville independent school district for $242.18, because there was no evidence to support the allegation contained in plaintiff’s petition that the commissioners’ court of Erath county had authorized and directed the county attorney of that county to institute suit to collect those taxes, as well as taxes due the state and county. This assignment is overruled because defendant filed no verified plea denying that allegation and offered no proof to controvert it. I. & G. N. Ry. Co. v. Bradt, 57 Tex. Civ. App. 82, 122 S. W. 59; M., K. & T. Ry. Co. v. Allen, 53 Tex. Civ. App. 433, 115 S. W. 1179; Kaack v. Stanton, 51 Tex. Civ. App. 495, 112 S. W. 702.

Several other cross-assignments are presented to the action of the court in overruling special exceptions to plaintiff’s petition, presenting such objections to the petition as that it failed to properly describe the property omitted from assessments, and presented only legal conclusions instead of necessary allegations of fact, etc., all of which assignments are overruled, since it does not appear that the error, if any, in overruling such exceptions, resulted in any harm to ap-pellee.

For the reasons indicated, the judgment is affirmed.
      ¡Sc^For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: FLY, C. J.

text:
    DAVIS et al. v. COX.
    (No. 5485.)
    (Court of Civil Appeals of Texas. San Antonio.
    May 19, 1915.)
    1. Homestead &wkey;>129 — Conveyances—Estop-pel — Purckasee in Good Faith.
    A debtor gave a note and delivered a deed, executed by himself and wife, conveying to a third person a part of the homestead to secure the note. The third person executed to the debtor notes reserving a vendor’s lien, and they were transferred to the creditor as security. The debtor and family remained in possession of the property until the land was sold under execution under judgment foreclosing the vendor’s lien in a suit by the creditor against third person brought after the debtor’s death. The purchaser, at the execution of the sale, knew the facts. Held that he was not a purchaser in good faith, and he could not claim under the judgment of foreclosure, which was void as against the wife and heirs at law of the deceased debtor.
    [Ed. Note. — For other cases, see Homestead, Cent. Dig. §§ 233, 234; Dec. Dig. &wkey;129.]
    2. Appeal and Ekeoe <&wkey;930 — Vekdict—Re-view.
    Where the court submitted issues on which the evidence was conflicting, and issues not supported by evidence, a general verdict will be set aside where it might have been based on the latter issues.
    [Ed. Note. — For other eases, see Appeal and Error, Cent Dig. §§ 3755-3761; Dec. Dig. <&wkey;
    Appeal from District Court, Polk County; J. Llewellyn, Judge.
    Action by Caroline Davis and others against D. J. Cox. Prom a judgment for defendant, plaintiffs appeal.
    Reversed and remanded.
    O. S. York, of Galveston, and Holshousen & German, of Livingston, for appellants. Campbell & Campbell, of Livingston, for ap-pellee.
   FLY, C. J.

Appellants, the widow and heirs at law of Emanuel Davis, deceased, instituted this suit against appellee to recover 80 acres of land alleged to be a part off their homestead. It was alleged in the petition that in 1897, Emanuel Davis was indebted to W. E. Fitze in the sum of $246.85; that said Davis executed and delivered to said Fitze, on November 30, 1897, his promissory note for said indebtedness and to secure the same; on the same day said Emanuel Davis, joined by his wife, Caroline Davis, executed and delivered to one Allen Bailey a certain deed of conveyance to 80 acres of land out of their homestead; that said deed was intended merely as a mortgage; that Bailey executed to Emanuel Davis his two promissory notes, a vendor’s lien being reserved therein, and at the same time the two notes were transferred by Emanuel Davis to Fitze, as security for his debt; that it was agreed that said Bailey was not to pay anything on the notes and was not to be responsible for payment of the same. Appellee pleaded estoppel, title under a judgment rendered on November 19, 1900, and limitations of three, four, five and ten years. The cause was tried by jury, and resulted in a verdict and judgment for appellee.

The uncontroverted evidence shows that the land in controversy, in 1897, was the property of Emanuel and Caroline Davis and a part of their homestead; that Emanuel was indebted to W. E. Eitze in the sum of $246.86 for goods sold him; that the attorney of Eitze visited Emanuel Davis and his wife, Caroline, to collect the money due Eitze; that he procured from them a deed to Allen Bailey, who never at any time paid them or any one else a cent on the land, but who executed to them two promissory notes, each for $200, which at the same time were transferred to W. E. Eitze to secure a promissory note given at the same time by Davis to Eitze. All the papers were prepared on the same day by the attorney of Eitze, and the different instruments formed one and the same transaction. Bailey did not go into possession and never at any time exercised any rights of ownership over the land, but Davis and wife remained in possession. Such possession was not disturbed until the land was sold under execution in a case wherein W. E. Eitze was the plaintiff and Allen Bailey and Emanuel Bailey were defendants. In that suit the vendor’s lien retained in the two notes given by Bailey to Davis was foreclosed. Caroline Davis was not a party to that suit. Emanuel Davis and Caroline Davis were ignorant old negroes, unable to read or write. Emanuel Davis died before this suit was instituted. Fitze did not testify in the case. The evidence failed to show title by estoppel or limitations in appellee. Appellee was too uncertain as to his possession of the land to sustain the plea of limitations, and the other testimony tended to show that there was no limitation.

It was admitted by appellee that the family of Emanuel Davis was in possession when he bought the land from Eitze. There was a house on the land, and appellee testified:

“Old man Emanuel’s family and the boys and girls and children were using it — well, Dave Davis’ wife, I think, lived in it when I bought the land.”

Appellee further stated:

“I had known old man Emanuel Davis. I suppose old man Emanuel had been living on that land and using it as his home up to the day I bought it.”

The 80 acres in controversy had never been segregated from the balance of the homestead. Appellee knew that Allen Bailey at no time had possession of the land, but that it remained in the possession of Emanuel Davis and was used and cultivated by him. He knew that in Texas when a sale of land is made, the vendee usually does not permit the vendor to remain in possession a's though no sale had been made for nearly four years. He knew that the mortgagor of land usually remains in possession of the mortgaged premises. The fact of the vendor’s unbroken possession for years after executing the deed was a circumstance sufficient to excite inquiry in any reasonable man. He knew that the land was a part of the homestead of Emanuel and Caroline Davis, and was charged with knowledge that Caroline Davis was not made a party in the foreclosure of the vendor’s lien against Emanuel Davis and Allen Bailey, and. that she was a necessary party in that suit if she could have urged homestead rights, which would have defeated the action. Jergens v. Schiele, 61 Tex. 255; City of San Antonio v. Berry, 92 Tex. 319, 48 S. W. 496; Collum v. Sanger, 98 Tex. 162, 82 S. W. 459, 83 S. W. 184; Odum v. Menafee, 11 Tex. Civ. App. 119, 33 S. W. 129; San Antonio Building & Loan Association v. Stewart, 27 Tex. Civ. App. 299, 65 S. W. 665. The judgment of foreclosure was void and appellee could not claim under and through that judgment. He.was not a purchaser in good faith, and the court should so have instructed the jury, instead of submitting the question of notice.

Appellee failed to show continuous adverse possession of the land for five years, and the only issues raised by the evidence were, whether or not the deed to Bailey was a mortgage instead of a deed, and whether Fitze knew or could have known by inquiry that the deed was given merely as security for his debt. On those issues the evidence was conflicting, some of the circumstances tending strongly to show that the deed was in reality a mortgage, and given to evade the homestead law. The issues of notice and limitations were submitted to the jury although the evidence did not support either of them, and it may be that the verdict was based on one of them and not on the good faith of Eitze.

The judgment is reversed, and the cause remanded.
      <S&wkey;For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: JENKINSj J.

text:
    BIGHAM HARDWARE & FURNITURE CO. et al. v. SPARKS LUMBER CO. et al.
    (No. 5487.)
    (Court of Civil Appeals of Texas. Austin.
    April 28, 1915.)
    1. Garnishment <@=145 — Claims by Third Persons — Answer—Stjeotcienoy.
    Under writ of garnishment issued and served on June 22, 1912, to subject corporate stock to the payment of a judgment against C., an answer was filed by a party claiming the stock by a purchase from S. on September 4,1912. Held, that an exception to such answer on the ground that it showed a purchase of the stock after the writ was served, and that it did not appear therefrom that S. ever owned the stock, was erroneously overruled.
    [EcJ. Note. — For other cases, see Garnishment, Cent. Dig. § 273; Dec. Dig. @=145.].
    2. Garnishment <@=218 — Triai^-Evidence— Admissibility.
    In a proceeding under a writ of garnishment to subject to the payment of a judgment against C. corporate stock which appeared upon the books, of the corporation in the name of C.’s daughter, evidence that the daughter and her husband had admitted that she owned no interest in the stock, and had never owned it, was erroneously excluded.
    [Ed. Note. — For.other cases, see Garnishment, Cent. Dig. §§ 411-413; Dec. Dig. <S=21S.]
    Appeal from Coryell County Court; G. E. Johnson, Judge.
    Action by the Bigham Hardware & Furniture Company and others against the Sparks Lumber Company and others. From the judgment, plaintiffs .appeal.
    Reversed and remanded.
    Watt L. Saunders and Sadler & Cobb, all of Gatesville, for appellants.
   JENKINSj J.

On June 14, 1912, appellant company filed its affidavit in the county court of Coryell county, in cause No. 711, alleging that it was the owner of a judgment for $347 against J. B. Cass, and that said Cass was the owner of $1,000 of stock in the Sparks Lumber. Company. A writ of garnishment was issued and served on said, lumber company on June '22, 19Í2. On September 2, 1912, the lumber company filed its answer, denying that J. B. Cass was the owner of any shares of stock in said com-, pany. On September 12, 1912, appellants contested said answer, alleging that the books of éaid lumber company showed that Vera ■ Cass was' the owner of $1,000 of sto.ck in said company, but that in truth and in fact • said stock belonged to J. B. Cass, and that' the same ivas placed by him in the name of his daughter1 Vera Cass, Who had no interest therein. On Oetobér 14, 1912, appellant made Vera Cass "(who had married R." HI Glenn) and also her husband parties defendant' to Said shit,-and' on January 25; 1913, bj< amended petition, "alleged that M. J. Koza was titaiming ’ some interest in said stock, and fnade him a : party defendant. No answer Wásüléd by'eithér J. B.-'Cass or Vera Glenn and her husband, R. H. Glenn. Koza filed an answer, alleging that he was the owner of said stock, and that he had purchased the same on September 4, 1912, from one E. B. Stribling. Appellants excepted to the answer of Koza, for the reason that it showed he had purchased said stock after the writ of garnishment was served herein on the lumber company, and that it did not appear from said answer that said Stribling ever owned said stock. Said exception was overruled, and the action of the court therein is assigned as error. The exception should have been sustained; and, no answer having been filed by either Cass or Mrs. Glenn and her husband, and the lumber company having filed no answer denying the allegation that the stock stood upon its books in the name of Vera Cass, now Vera Glenn, judgment by default should have been rendered in favor of appellant company and the bank, which appeared to have purchased said judgment from said company pending this suit.

It was shown upon ■ the trial of this cause that Vera Cass appeared upon the books of the lumber company to be the owner of $1,000 of stock therein. Appellants offered to prove that Vera Glenn and her husband had admitted, since they were served with citation herein, that she owned no interest. in said stock, and had never owned the same. Objection was sustained to said testimony. This was error.

For the reasons above stated, this case is reversed and remanded’, and if the pleadings and evidence upon another.trial are substantially thé same as upon the former, trial, the court will render judgment, for the appellants. ,

Reversed and remanded.