text:
    WOMACK v. HASTINGS & LAGOW.
    (No. 8739.)
    (Court of Civil Appeals of Texas. Ft. Worth.
    Nov. 24, 1917.
    Rehearing Denied Jan. 12, 1918.)
    1. Fraud >&wkey;60—Actions—Damages.
    In a suit for damages based on fraud and deceit in the sale of a jack, a recovery cannot be had for profits.
    2. Fraud <&wkey;59(3) — Actions Measure oe P am ages.
    In an action for damages based on fraud and deceit in the sale of a jack for breeding purposes, the proper measure of damages was the difference between the price paid for the animal and the actual value thereof, plus any sums legitimately expended by the purchaser by reason of the fraudulent representation.
    3. Fraud <&wkey;60—Action—Damages.
    In an action for damages based on fraud and deceit in the sale of a jack for breeding purposes, recovery could not be had for feed and care of the animal after it was discovered by the purchaser that the jack was not available for the purpose for which purchased.
    Appeal from District Court, Tarrant County; J. W, Swayne, Judge.
    Action by Hastings & Lagow against William Womack. Judgment for plaintiffs, and defendant appeals.
    Reformed and affirmed.

      J. X. Cummings, of Ft. Worth, and W. B. Hamilton, of Dallas, for appellant. Slay, Simon & Smith, of Ft. Worth, for appellees.
   BUCK, J.

Appellees sued appellant for damages, alleging fraud and deceit in the sale by appellant to the appellees of a jack. They alleged that at the time of the purchase appellant represented to them that the jack was fit for the purposes for which he was bought; that in fact he was not so fit, and was, indeed, entirely worthless. The appellant denied the allegations of misrepresentation and fraud made by appellees. The cause was submitted to a jury on special issues, which were found in favor of the plaintiffs below, except that the jury found that the jack was not worthless, and that his value at the time of the purchase was $100. Judgment was rendered for plaintiffs in the sum of $1,638.60, which included interest to the amount of $88.60. Defendant has appealed.

Appellant urges that an improper measure of damages was adopted by the court in rendering judgment, and we are of the opinion that this contention, set forth in several assignments of error, must be sustained. Plaintiffs sued for damages alleged to have been sustained in the 'following respects 'and amounts, to wit: (1) $500, the price paid for the animal, which was alleged to be worthless; (2) $10.30 freight charges paid from Ft. Worth to Roscoe, Tex.; (3) $400 alleged to be the net profits which would have accrued to plaintiffs during the first season if the jack had been as represented; (4) $250, which plaintiffs alleged were reasonably incurred in the feeding and care of the animal; (5) for punitory damages in the sum of $1,500; (6) for interest on the sum found to be due.

The jury failed to find that plaintiffs were entitled to punitory damages, and we have been at a loss to determine the basis of the court’s judgment in the principal sum of $1,550. Moreover, in a suit of this kind, for fraud and deceit, it is well established in this state, though otherwise held in some jurisdictions, that a recovery cannot be had for profits. The rule as to measure of damages in this character of a suit is different from the one obtaining in an action for breach of contract. George v. Hesse, 100 Tex. 44, 93 S. W. 107, 8 L. R. A. (N. S.) 804, 123 Am. St. Rep. 772, 15 Ann. Cas. 456; Greenwood v. Pierce, 58 Tex. 130; Sigafus v. Porter, 179 U. S. 116, 21 Sup. Ct. 34, 45 L. Ed. 113; 12 R. C. L. 451, § 196; Latham Co. v. Snell, 176 S. W. 917; Gordon v. Rhodes, 117 S. W. 1023. The cases of Handy v. Roberts, 165 S. W. 37, Jones v. George, 61 Tex. 345, 48 Am. Rep. 2S0, and other cases which might be cited, are distinguishable, both in their facts and the nature of the action, from the instant case. , There the seller failed to deliver to the purchaser the kind of article which was the subject of the contract to purchase, but delivered a different article, in the first case a different kind of oats, in the second a different kind of drug. Hence there was a breach of the implied contract to deliver the thing bought. Here plaintiffs secured the identical animal which they bargained for, though he did not possess the characteristics which the seller represented him to have. If there are any expressions in the cases of Suttle v. Hutchinson, 31 S. W. 211, and Ford v. Oliphant, 32 S. W. 437, which may be reasonably construed as a holding contrary to the views hereinabove expressed, then these two cases, upon this point, must be held to have been overruled by our Supreme Court in George v. Hesse, supra, and many other later Supreme Court decisions.

We are of the opinion that fundamental error is shown in the judgment, which applies an improper measure of damages. The measure of damages which the court should have applied in this case was the difference between the price paid for the animal and the actual value thereof, plus any sums legitimately expended by plaintiffs by reason of the alleged fraudulent representation. Beckwith v. Powers, 157 S. W. 177; Weeks v. Stevens, 155 S. W. 667; Smith v. Bolles, 132 U. S. 125, 10 Sup. Ct. 39, 33 L. Ed. 279.

The evidence shows that the jack was bought on March 15, 1913; that plaintiffs kept him in the paddock for service until the middle of July following; that during said time he sired one colt, for which plaintiffs were entitled to the service fee of $10. It is in evidence that it was reasonably worth $10 a month to feed a jack, and over $10 to care for him. Certainly at the end of the breeding season, which was stated to end July 15th, • plaintiffs were sufficiently advised that the jack was not available for the purposes for which they had purchased him, and we do not believe, in any event, they would be entitled to recover for the care and keep any longer. Moreover, the evidence shows that some time thereafter the jack was turned into the pasture, and was no longer kept in a stall and fed. Further, the evidence fails to show what was the reasonable cost of pasturing the jack or otherwise caring for him, except during the breeding season.

We are doubtful of the right of the plaintiffs to recover for the feed and care of the animal for even the four months, but certainly they cannot recover for such care and feed after it was disclosed that he was not available as a breeder. However, we have decided that in support of the judgment we will permit a recovery for the four months at $20 a month, or $80. Therefore we will accept appellees’ offer to remit any excess, and reform the judgment so as to exclude the item of profits, and the item for feed and care except as to the four months. Prom this amount the $10 fee earned for the colt sired must be deducted. This would make the amount for which the judgment will be affirmed $480.30, consisting, of, to wit, $400, the difference between the cost price of the jack and his actual value; $10.-30, freight charges; $80 for care and keep, less the fee for colt, or $70. Costs of this appeal will be taxed against the appellees.

We consider the question as to the measure of damages the only one requiring discussion, although we have considered each of the other assignments of error presented in appellant’s brief, and find no error. We do not believe that the trial court is shown to have abused his judicial' discretion in overruling the defendants’ motion for a continuance under the circumstances shown. All assignments are overruled except as above indicated.

Reformed and affirmed.

CONNER, C. J., not sitting; serving on writ of error committee at Austin.
      <&wkey;Eor other eases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


source: Caselaw Access Project

author: BUCK, J.

license: Public Domain

text:
    HALL et al. v. COLLIER.
    (No. 8730.)
    (Court of Civil Appeals of Texas. Ft. Worth.
    Nov. 17, 1917.
    Rehearing Denied Dec. 22, 1917.)
    1. Justices of the Peace &wkey;>202(2) — -Review —Certiorari.
    A petition for certiorari to the justice court alleging that the uncontradieted evidence showed plaintiff in replevin was the owner and entitled to the possession of the diamond in question, examined, and held to set forth the substance of facts showing that injustice had been done the applicant sufficient to comply with Vernon's'Sayles’ Ann.. Civ. St. 1914, art. 746.
    2. Replevin <&wkey;72 — Special Findings — Description of Property — Sufficiency of Evidence.
    Evidence in a replevin case as to the identity of a diamond with an imperfection termed once as a “scratch” and again as a “shiver” examined, and held sufficient to uphold the finding on special issue that it was plaintiff’s diamond.
    3. Appeal and Error &wkey;>1060(2) — Teial <&wkey; 110 — Review — Prejudicial Error — Conduct of Counsel.
    The act of counsel for plaintiff in a replevin case in calling the jury’s attention to a flaw in the diamond during the testimony of plaintiff as to its identity, which act would have been proper in argument, was not an admission of the attorney’s unsworn testimony, and' was not prejudicial error.
    4. New Teial <&wkey;44(l) — Misconduct of Jurors — Inspection of Evidence During Teial.
    The act of a juror during the introduction of evidence in an action to replevin a diamond in placing a dampened paper over it, and calling the attention of .the other jurors to the fact that the presence of the flaw testified' to by plaintiff was thereby made more apparent, did not evidence an undue bias authorizing a new trial.
    5. Juey &wkey;>42 — Disqualification of Jurors —Intelligence and Education — Special Knowledge.
    ■ An act of a juror in inspecting a diamond, the identity of which was in question, showing him to be possessed of superior knowledge, of the facts helpful in disclosing the truth, cannot bo held a disqualification.
    Appeal from Tarrant County Court; Charles T. Prewitt, Judge.
    Suit by Miss Nan Collier against W. L. Davis, N. C. Hall, the American National Bank, and others. Judgment for plaintiff, and defendants N. C. Hall and the American. National Bank appeal.
    Affirmed.
    Bryan, Stone & Wade, of Ft. Worth, for appellants. 'Simpson & Estes, of Ft. Worth, for appellee.
   BUCK, J.

'Suit was filed by plaintiff, Miss Nan Collier, in the justice court of Tarrant county on April 21, 1914, to recover a diamond ring. She alleged that on December 31. 1912, she was the owner of and in possession of one certain diamond ring of the weight of about one-half carat; which was, at that time, mounted in what is known as a “Tiffany” mounting, but that since said date and subsequent to her loss of the ring, said diamond had been mounted in what is known as a “Belcher” mounting; that the diamond was an imperfect stone, “one of the defects in same being a scratch across the face of said stone; that said diamond has other flaws in same; and that said mounting that said diamond is now mounted in has small notches cut in it at several places, and that there is on the inside face of said mounting a letter or mark in the shape of an ‘x,’ and that said mounting is also marked or printed ‘14 carat.’ ” She further alleged that said ring had been given to her by her father, then deceased, and was of the reasonable value of $125; that on said above alleged date one W. L. Davis was visiting her at her home when plaintiff permitted him to take said ring in his hands in order to examine it; that while the two were examining the ring and other jewelry of plaintiff, she was called to the door by a visitor, and that when she returned Davis handed her, as she thought, all of the jéwelry they had been examining, and then went away; that later she discovered that he had not returned to her the ring in question; that thereupon she undertook to And said Davis, and as soon as she did so she demanded the return of said ring, but that he failed and refused to return same to her, but kept it and pawned or mortgaged it to the American National Bank of Ft. Worth. She further alleged that said American National Bank had subsequently sold said ring to N. O. Hall, a jeweler of Ft. Worth, who claimed at the time of suit to be the owner of said ring and diamond,• that said Hall had delivered said ring and diamond to one Horace M. Collins “for the purpose of having him see if said ring and diamond could be properly identified as the property of plaintiff, hut that at the time said defendant Hall delivered said ring and diamond to defendant Collins, defendant Hall stated that he would not allow said plaintiff, Miss Nan Collier, to have said ring and diamond, unless she would repay him what he had paid out in money to said American National Bank for said ring and diamond.”

Davis, the American National Bank, N. C. Hall, and Horace Ml Collins were made defendants in the suit. On May 28, 1914, in the justice court, judgment was rendered for the defendants, and N. C. Hall was adjudged to be the rightful owner and entitled to the possession of the ring in question. On July 22, 1914, the judge of the county court of Tar-rant county for civil cases granted plaintiff’s petition for certiorari to ' the justice court, and on August 8th thereafter the writ was issued, a bond in the sum of $100 having been given by petitioner and duly approved. On September 5th following the defendants American National Bank and N. C. Hall filed their motion to dismiss the certiorari, which motion was by the court overruled. On March 18, 1910, plaintiff amended her petition, setting forth, in substance, the same allegations as contained in the written petition filed in the justice court and which was later filed in the county court, except that in this amended petition the diamond was described as follows:

“About one-half metric carat in weight, color known as ‘cape,’ containing an imperfection or flaw which plaintiff alleges upon information to be known as a ‘shiver.’ ”

Two trials were had in the county court, in both of which plaintiff prevailed, and from the last judgment rendered, on, to wit, October 18, 1916, defendants Hall and American National Bank appeal.

Error is assigned to the action of the court in overruling the motion of appellants to dismiss the writ of certiorari, on the ground that the application therefor is not in compliance with the requirements of the statute (Article 746, V. S. Texas Civil Statutes), as construed by the decisions of the courts.

The record does not purport to give the evidence adduced on the trial in the justice court, nor the pleadings of the appellants here, which appear.to have been oral. Neither does the motion to dismiss allege what the pleadings were, nor what the evidence constituted, except said motion to dismiss recites that the defendants “pleaded in the justice court, and offered evidence to establish their pleading, upon two theories of defense —one of them being that the plaintiff had given to the defendant W. L. Davis the diamond in controversy, and that he had abso; lute title thereto; the other being that if she had not given the diamond to W. L. Davis, she had permitted him to exercise ownership over it, and had acted so as to show acquiescence in his pretended ownership of the diamond, and thereby estopped herself from claiming said diamond as against these defendants.”

The .application for the writ filed by plaintiff in the county court, after setting forth the names and description of the parties litigant and of the property in controversy, and after reciting the nature and result of the trial in the justice court, and after alleging .matters of jurisdiction in said justice court, continues:

“Tour petitioner avers that gross injustice was done to her by the final disposition of the said suit in said justice court, and that such injustice was not caused by her own inexcusable neglect; that she contested said case, and did not suffer any judgment by default to be rendered against her, but that said judgment was entered upon the hearing of evidence; that she was prevented by causes beyond her control from prosecuting an appeal within the statutory time; * * * that said justice of the peace erroneously and arbitrarily found against her, although the evidence and law not only warranted, but required, a judgment to be entered in her favor, in that the undisputed and uncon-tradicted evidence in said case showed that she was at all times the owner of and entitled to the possession, and title of said diamond ring, and that the defendant Davis had stolen the same from her, or acquired the same by fraud and false and fraudulent pretenses and means, and that she therefore never parted with the title to said ring or the ownership thereof; and that thereafter without her knowledge or consent the said Davis pawned said ring or pledged the same with the defendant the American National Bank of Ft. Worth, Tex., for a debt which he had incurred at said bank, and the said American National Bank of Ft. Worth never legally acquired the possession of said ring or any claim or lien or title of any kind thereto; and thereafter the said American National Bank of Ft. Worth, Tex., converted the said ring.to its own use and benefit, and sold and disposed of the same to N. O. Hall of Ft. Worth, Tex., who ac- , quired the same not as innocent purchaser thereof, but in fraud of the rights of your petitioner and subservient to her title and ownership therein; and thereafter the said Oollins by some means or pretext acquired possession of said ring from said Hall, and turned the same over during the course of the trial to said justice of the peace; that neither of the defendants have any shadow or claim of title to said ring, and are not entitled to its possession as a matter of fact or of law, but that said justice of the peace should have adjudged that said diamond ring was the property of this applicant.”

'The evidence disclosed that the defendant Oollins, representing the appellee in company with her, called on N. C. Hall at his jewelry store in Ft. Worth, and was permitted to examine a tray of diamond rings; that Bliss Collier picked out one ring and identified it as the one she had lost through the acts of the defendant Davis. Hall permitted Collins to take the ring so identified for the purpose of further investigation as to who was the rightful owner thereof. Upon the trial of the case Collins pleaded that he laid no claim to the ring, and asked to be discharged with his costs. The ring was deposited with the c-lerk of the county court, and the judgment adjudged to plaintiff the right of recovery of the title and possession of the ring in "question as against all of the defendants. Appellants urge the insufficiency of the petition for the writ of certiorari, in that it is claimed said petition fails to contain the evidence on the trial in the justice court, and does not set forth the pleadings in said court, and consists of mere conclusions of the pleader as to the evidence introduced in the court of origin.

Article 746, V. S. Texas Civil Statutes, provides:

“In order to constitute a sufficient cause, the facts stated must show that either the justice of the peace had not jurisdiction, or that injustice was done to the applicant by the final determination of the suit or proceeding, and that such injustice was not caused by his own inexcusable neglect.”

In McBurnett v. Lampkin, 45 Tex. Civ. App. 567, 101 S. W. 864, it is held that cer-tiorari to review a justice court judgment is not granted as a matter of right; the application being addressed to the discretionary powers of the court, and that in considering a motion to dismiss certiorari to review a justice’s judgment, the court should look to the petition as well as the transcript to determine the merits of the motion; that mere general statements of a good defense or that injustice has been done is not sufficient, but said petition must state the facts upon which it is expected to recover, should the writ be granted. See, also, Perry v. Lovett, 24 Tex. 359; Clark v. Hutton, 28 Tex. 125; Oldham v. Sparks, 28 Tex. 429; Robinson v. Lakey, 19 Tex. 140. In Gould v. Sanders, 60 Tex. Civ. App. 410, 127 S. W. 899, it is held that in an application for certio-rari to a justice court, the petition must either state all the evidence, or show that a material error occurred in the proceedings, or that applicant has not been able to avail himself of a legitimate prosecution or defense by no fault of his own, but one or all of these causes must be set forth with sufficient detail to show a prima facie case entitling petitioner to another rehearing. In Beard v. Miller, 4 Willson, Civ. Cas. Ct. App. § 76, p. 117, 16 S. W. 655, it is held that a petition for certiorari need not set out verbatim the testimony at the trial in the justice court, but merely the substance of all the evidence is sufficient. See, also, Carroll v. Gilbert, 4 Willson, Civ. Cas. Ct. App. § 266, 17 S. W. 1086.

A petition for certiorari must purport to set out all the evidence in substance, adduced in the trial court. G., C. & S. E. Ry. Co. v. Odom, 4 Willson, Civ. Cas. Ct. App. § 106, 16 S. W. 541. In Rollison v. Hope, 18 Tex. 446, cited in Seeligson & Co. v. Wilson, 58 Tex. 369, Justice Wheeler said:

“The affidavit is not in the most approved form. But a substantial compliance with .the law is all that is required, and the law does not prescribe the terms of the affidavit, but only that the party applying shall make affidavit in writing setting forth sufficient cause to entitle him to the writ. * * * The practice has been to construe these proceedings liberally, and not to require the same strictness which is required in the proceedings in the ordinary suits in the district court.”

In Nelson v. Hart, 23 S. W. 831, 833, it is said:

“While the writ of certiorari may, possibly, not be one of right, as has been held, we are of the opinion, when the affidavit shows a meritorious cause, and that injustice has probably been done which was not caused by his negligence, a substantial compliance with the law is all that is demanded. Rev. St. art. 303. There is no form prescribed for the affidavit, and if an injury is shown to have been perpetrated, the law will be satisfied.”

In McKensie v. Pitner, 19 Tex. 135, the Supreme Court said:

“There should be a reasonable degree of certainty [in a petition for certiorari], but not that extreme degree which is described in law as certainty in every particular, and which rebuts every conclusion to the contrary.”

In King v. Longcope, 7 Tex. 236, it is said that a certiorari ought to be granted where, from the averments of the petition, if true, it appears that the party has merits, and there is reason to apprehend that injustice may have been done him, without any fault of his. See, also, Hooks v. Lewis, 16 Tex. 551; Connally v. Renn, 17 Tex. 123; Jones v. Nold, 22 Tex. 380. In Bowman v. Weber, 41 S. W. 493, where it was alleged that the petitioner had stated “the substance of all the facts proved on the trial of said cause,” and where the petitioner further recited the grounds upon which he claimed a judgment for him should have been rendered in the court below, it was held that the petition showed a meritorious cause of action, and gave reason to apprehend that injustice had been done the petitioner in the court below, and that the motion to quash or dismiss the Writ was properly overruled.

We think the allegations contained in the petition in the instant case, to the effect “that the undisputed and uncontradicted evidence in said case showed that she was at all times the owner of and entitled to the possession and title of said diamond ring,”etc., should properly be construed, in support of the action of the trial court, as being an allegation to the effect that the recitations in the application as to the evidence in the justice court set forth the substance of all the evidence adduced. If so, we are of the opinion that the petition, on its face, contained recitations as to the state of evidence justifying the judge, to whom it was directed, in concluding that probably justice had been denied the petitioner in the justice court, and that she had been denied a judgment in her favor when the facts authorized and required the judgment to be rendered for her. Hence we overrule appellant’s first assignment.

The jury, in response to special issue No. 2, to wit: “Is the diamond introduced in evidence the same diamond described in plaintiff’s original petition?” answered, “Tes;” and we are of the opinion that we cannot disturb the judgment rendered on the ground that the evidence fails to sustain that portion of the jury’s verdict. While it is true that in the original petition filed in the justice court, and subsequently filed in the county court, the plaintiff below described the diamond as having “a scratch across the face of the stone,” and in the amended petition filed March 18, 1916, she described it as “containing an imperfection or flaw, which plaintiff alleges upon information to be known aá a ‘shivfer,’ ” yet she positively identified the diamond introduced in evidence as the one which had belonged to her, and in both petitions she described it as being one-half‘carat in weight and as having been mounted in Tiffany mounting, but later having been put in a Belcher mounting; and in both descriptions she alleged that it was an imperfect stone. Because the defendant Hall and other witnesses testified that there was no scratch across the face of the diamond, and that with the naked eye they could not see what they_termed the “shiver,” would not justify this court in reversing the judgment rendered for lack of sufficient testimony to identify the stone offered in evidence with the one alleged to have been stolen from the plaintiff. Miss Collier testified positively to the identification and to her ability to see what she described as a “scratch.” This conflict of the testimony the jury decided in favor of the plaintiff, and with that decision we are not disposed to interfere. It is immaterial whether the imperfection was termed a “scratch” or a “shiver.” The identity of the diamond in question was the issue.

Complaint is made of the court’s permitting plaintiff’s counsel to call the jury’s attention to the flaw in the diamond in controversy during the introduction of the testimony. It is urged that the plaintiff was the one who had identified the diamond and' whose eyesight claimed to have seen the flaw, and the counsel was not the one who had testified as to having seen any flaw therein, and therefore the action of the court in permitting the counsel to call the attention of the jury to What he claimed to be a flaw in the diamond constituted the admission' of unsworn testimony upon a material fact. We think during the argument the counsel for plaintiff would have had the right to exhibit the diamond, which had been introduced in evidence, to the jury, and to show the jury, if he could, the presence of the scratch or the shiver, or whatever the imperfection might be termed. While it is true, that this course of the counsel should properly have been reserved until the argument, yet we see no prejudicial error by reason of the court’s permitting the counsel to call the attention of the jury to the matter during the introduction of the testimony. Nor do we think there is any error shown in the action of one of the jurors during the introduction of testimony in placing a dampened paper over the diamond, and calling the attention of some of the other jurors to the fact that thereby the presence of the flaw was made apparent, or more apparent than without the wet paper. We do not think that the act of the juror evidences any undue bias, as claimed by the appellants, such as would have entitled the defendants to a new trial. Certainly during the deliberations of the jury, one of the jurors might properly have held the stone between him and a light or near a light and called the attention of the other jurors to what the proximity of the light disclosed. This is not an instance of the introduction of .new matter during the deliberations of the jury, which has often been condemned by our courts, but it seems to us is merely an evidence of a proper degree of interest and desire on the part of this juror to get at the real facts in the case.

While the act of the juror may show that he possessed superior knowledge of facts Which were helpful in disclosing the truth, yet such cannot be held to be a disqualification.

All assignments are overruled, and the judgment is affirmed.

CONNER, C. ,T., not sitting, serving on writ of error committee at Austin.
      ($&wkey;ITor other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: BUCK, J. BUCK, J.

text:
    IOWA CITY STATE BANK v. MILFORD.
    (No. 8734.)
    (Court of Civil Appeals of Texas. Ft. Worth.
    Nov. 10, 1917.
    On Motion for Rehearing, Dec. 22, 1917.)
    1. Bills and Notes <&wkey;365(l) — Assignments —Bona Fide Purchaser.
    Where a note given in payment for goods was assigned for valuable consideration before maturity of the first installment to a bánk without notice of any infirmity therein, the plaintiff is entitled to judgment thereon in view of Vernon’s Sayles’ Ann. Civ. St. 1914, arts. 582 and 589.
    2. Alteration oe Instruments <&wkey;9 — Consent — Provisions of Contract.
    Where, in the written contract between maker and payee of a note, it was specifically agreed that the note might be detached by the payee from such contract, such detachment on the perforated fines is not an alteration of the contract rendering the note nonnegotiable.
    3. Sales <&wkey;342 — Action eor Price.
    A notice by consignee, subsequent to shipment of goods, to postpone the filling of the order, does not invalidate or impair a note given prior to shipment for the purchase price of the goods.
    4. Bills and Notes &wkey;>342 — Bona Fide Purchasers — Constructive Notice.
    The mere fact that the edge of a note assigned showed perforations indicating it might have been detached from some other paper was not sufficient to show notice of alteration or other defects or defenses.

      On Motion for Rehearing.
    5. Appeal and Error <®=3l94(l) — Objections Below — Plea op Non Est Factum.
    In a suit on a note assigned, while a verified plea of non est factum to deny execution thereof is hardly in compliance with the requirements of Vernon’s Sayles’ Ann. Oiv. St. 1914, art. 1906, subd. 8, yet, in the absence of objection in the trial court, it may be considered as regular in form.
    6. Alteration op Instruments <&wkey;27(2) — Burden op Proop.
    Under a plea of non est factum where defendant relies upon the claim that the note sued on has been materially altered since execution after plaintiff has made a prima facie showing as to the execution of the note, the burden of proof shifts to the defendant.
    7. Bills and Notes <&wkey;492 — Presumption-Execution.
    There is a presumption that a document regular on its face has been duly executed, and this applies to bills and notes.
    8. Bills and Notes <&wkey;485 — Answer—Plea op Nonexecution — Effect.
    A verified plea of nonexecution of a note is not evidentiary in character, but merely robs the instrument involved, purporting to be executed by the party sought to be charged, of its own probative effect to establish its execution.
    9. Bills and Notes <&wkey;516 — Actions—Presumption and Burden op Proof — Prima Facie Showinc.
    Where, in a suit on a note, the plaintiff produced the note without objection apparently for all evidentiary purposes, as also the. order for goods for which note was given and letter of defendant requesting delay in filling the order, a prima facie case was made to charge defendant as maker of note.
    Appeal from, Knox County Court; J. M. Morgan, Judge.
    * Suit by the Iowa City State Bank against R. G. Milford. Judgment for defendant, and plaintiff appeals.
    Reversed and rendered. Rehearing overruled.
    Brookreson & Howell, of Benjamin, for appellant. J. S. Kendall, of Munday, for appel-lee.
   BUCK, J.

This is a suit by the Iowa City State Bank against R. G. Milford, seeking a recovery, as assignee, upon a note in the principal sum of $100, with interest at 6 per cent, from September 26, 1914. From a judgment in favor of defendant, the plaintiff has appealed.

The note was given by appellee to the Franklin Price Company in payment of certain goods ordered by Milford and was made payable in four installments of $25 each, due three, five seven, and nine months after date. On the back of the note it was indorsed:

“December 7, 1914. Pay Iowa City State Bank, Iowa City, Iowa, or order. [Signed] Franklin Price Company, by M. H. Taylor.”

The evidence shows without dispute the following facts: That the note was received hy Franklin Price Company in Iowa City from its traveling salesman on September 26, 1914; said note being attached to the order for the goods for which the note was given and separated therefrom by a perforated line. The order provided:

“The company is authorized to detach the below note when this order is approved and shipped.”

On September 24, 1914, the day after the note was given, though the note itself seems to have been dated September 26th, Milford wrote to Franklin Price Company, at Iowa City, the following letter:

“Gentlemen: On yesterday I booked an order for some of your goods, which since I have considered the proposition I am in no shape to take up this line now; so I am asking you to bold it up for me for awhile. Don’t ship- it until notified; the farmers are not selling their cotton and I will wait and see how things go before opening up a line like that. Hoping this is satisfactory, I remain,
“Tours respectfully.”

This letter was received by the Franklin Price Company on September 28th, at which time they had already accepted the order and delivered the goods for shipment to the transportation line, and received a bill of lading therefor, dated September 26, 1914. The transfer by the Franklin Price Company to the bank, appellant here, was made on the date alleged, December 7,1914, for a valuable consideration, and prior to the maturity of the first installment. The bank had no knowledge of any infirmity in the note. At the time of delivery to the bank, the note had been detached from the order.

We are of the opinion that the evidence shows without doubt that the appellant at the time of the suit was a holder for value, without notice of any infirmity in the note sued on, and was entitled to judgment for the face value of the note, Interest, and attorney’s fees. Therefore it becomes our duty to reverse the judgment, and here render judgment for the appellant for the amount of the note, principal, interest, and attorney’s fees, and it is so ordered. Articles 582 and 589, V. S. Texas Civil Statutes; Daniel v. Spaeth, 168 S. W. 509; Kaufmann & Runge v. Robey, 60 Tex. 308, 48 Am. Rep. 264; Texas Banking & Ins. Co. v. Turnley, 61 Tex. 365; Landon v. Foster Drug Co., 186 S. W. 434; Landon v. William E. Huston Drug Co., 190 S. W. 534; First National Bank v. N. Nigro & Co., 110 S. W. 536.

We presume that the trial court entered judgment for defendant, on the theory that because the evidence showed that the note had a perforated edge, tending to show that the note had been detached from some other instrument, and thereby altered since its execution by the payor, it was therefore not shown to be negotiable; and because the evidence showed that the note had been discounted at 10 per cent, in the transfer of it by the Franklin Price Company to appellant bank. But this case is easily distinguishable from Landon v. Halcomb, 184 S. W. 1098. Here, unlike the facts in the cited ease, it is shown that, in the written contract between Franklin Price Company and appellee, it was specifically agreed that the note might be detached by the company from the order and contract after said order had been received and approved by the Franklin Price Company. Here it is not shown, as was there, that the goods shipped, prior to the request by the appellee for a postponement of the shipment, were not of the reasonable value of the amount mentioned in the note. In fact, the record is silent as to whether appellee received the goods and used them, or what became of them. Indeed, so far as the record discloses, appel-lee would have had no sufficient defense against the payment of the note, had a suit been brought by the Franklin Price Company as plaintiff. A notice by the consignee, subsequent to the shipment of the goods, to postpone the filling of the order and the shipment, could not be held to invalidate or impair the note given for the purchase price of the goods.

In the case of Harrison v. Hunter et al., 168 S. W. 1036, the Amarillo court passed upon a case very similar in its facts and principles to the one under consideration, and held that where an order expressly provided that the note given for the purchase price of goods, the note being attached to the order but separated from it by a perforated line, as here, might be detached from the order, said detachment was not an alteration of the contract, and that thereby the note was not rendered nonnegotiable.

In Landon v. Huston Drug Co., supra, this court held that the mere fact that the edge of notes showed perforations indicating that they might have been attached to other paper was not -sufficient to show notice of defects or defenses against them.

Judgment reversed and here rendered for appellant.

CONNER, C. J., not sitting, serving on writ of error committee at Austin.

On Motion for liehearing.

BUCK, J.

Appellee, who presented no brief on original hearing, now urges that we erred in reversing and rendering judgment, because, he insists, in the face of his verified plea of non est factum, the note itself was inadmissible to prove its execution, and that, further, there is no evidence in the record establishing, or tending to establish, such execution. While the plea of non est factum filed by defendant below is hardly in compliance with the statutory requirements (article 1906, subd. 8, Y. S. Texas Civil Statutes), yet, in the absence of any objection thereto in the trial court, it may be considered as regular in form. But the interposition of said sworn plea merely puts the plaintiff on proof, aliunde the instrument itself, of its execution. But when the plaintiff has made a prima facie showing as to the execution, then the burden of proof rests upon the defendant, who relies upon the claim that the signature-to the instrument was not in fact made by him or under his authority, or that there has been a material alteration of the instrument since it was executed to establish such defense.

The presumption is that documents regular on their face have been duly executed. 1 Jones on Evidence, § 50, p. 247. The verified plea of nonexecution is not evidentiary in character, but merely robs the instrument involved, purporting to be executed by the party sought to be charged, of its own probative effect to establish its execution. But when, aliunde the instrument itself, the plaintiff makes out a prima facie case as to the execution, it devolves upon him who would deny it to overcome the prima facie showing. In this case, the plaintiff introduced the note, without objection, apparently for all evidentiary purposes for which it was admissible. He further introduced, also without objection, the order signed by the defendant, referring to this nota He further introduced the letter set out in our original opinion, in which the defendant referred to the order, without disputing or denying its execution or validity. The execution of the order and the note constituted one transaction. Hence we are of the opinion that the plaintiff made out a prima facie showing as to' the execution. There is an absolute absence of any evidence to overcome this prima facie showing. It therefore became the duty of the court to determine this issue in favor of plaintiff.

As to the claimed alteration of the instrument by reason of its detachment from the order, we have sufficiently discussed that feature in our original opinion.

The motion for rehearing is overruled.

CONNER, C. J., not sitting, serving on writ of error committee at Austin.
      <§=»For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

      (&wkey;>For other oases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: DUNKLIN, J.

text:
    LYNN v. McCOY et al.
    (No. 8723.)
    (Court of Civil Appeals of Texas. Ft. Worth.
    Nov. 3, 1917.)
    Escrows <&wkey;8(l) — Delivery by Depositary.
    Where one with whom a deed is placed in escrow delivers it in accordance with the escrow agreement, there is a valid delivery tc the grantee, preventing rescission against an innocent purchaser from the grantee, notwithstanding fraud of the grantee inducing execution of deed and escrow agreement.
    Appeal from District Court, Nolan County • W. W. Beall, Judge.
    Suit by Hugh L. Lynn against Jasper Me Coy and another. From judgment for de-feridant Fred Slater, plaintiff appeals.
    Affirmed.
    W. E. Ponder and Grisliam & Grisham, all of Sweetwater, for appellant. Beall & Douthitt, of Sweetwater, for appellee.
   DUNKLIN, J.

Hugh L. Lynn instituted this suit against Jasper McCoy and Fred Slater to recover a section of land consisting of 640 acres. McCoy filed a disclaimer, upon which judgment was awarded in plaintiff’s favor against him, but judgment was also rendered, denying the plaintiff a recovery as against Slater, and from that portion of the judgment plaintiff has appealed.

Plaintiff and his wife executed and acknowledged in statutory form two instruments in writing, one a deed to the land in controversy and the other a contract authorizing a delivery of the deed. The deed purported to be a conveyance of the land with general warranty of title to defendant McCoy for a cash consideration in the sum of $100, containing the stipulation that McCoy took the land subject to liens to secure two promissory notes then owing by Lynn, one for the principal sum of $1,000, dated May 17, 1910, bearing interest from date at the rate of 5 per cent, per annum until maturity, payable November 1, 1915, and 10 per cent, per annum thereafter; and the other note for the principal sum of $163.75, payable in installments as follows: $13.75 November 1, 1910, and five installments of $30 each, payable, respectively, on November 1st of each year, beginning with 1911 and ending 1915. The deed further stipulated that the grantee took said land subject to all back taxes due .thereon. Both of those notes were payable to the Middlesex Banking Company of Middleton, Conn.

The written contract recited that plaintiff and his wife were the owners of the land; that they were indebted to the Middlesex Banking Company in approximately the sum of $1,700, which was secured by deed of trust on the land; that the taxes upon the land had not been paid for the preceding two years, and that the same aggregated approximately $200, which also constituted an in-cumbrance upon the land. The contract further recited that McCoy had agreed to purchase the land from plaintiff and wife and to pay them the sum of $100, and take the land subject to the liens mentioned, provided they owned a> good and merchantable title. The contract further recited that Lynn and wife had agreed to accept $100 for their interest in the land, and had executed their warranty deed to McCoy, conveying the same to him. It further contained the following stipulation:

“It is therefore agreed by and between the said Hugh L. Lynn and Lizzie Lynn, parties of the first part, and the said Jasper McCoy, party of the second part, that said warranty deed above mentioned is to be placed in escrow in the First National Bant of Hamlin, Texas, to be held by said bank and delivered to said Jasper McCoy after he has had a reasonable time to have the title to said land examined not to exceed thirty days from this date, upon the payment to said bank for the said Hugh L. Lynn and Lizzie Lynn of the sum of $100.00. Px-ovidcd that should the said Jasper McCoy not deposit in said bank within said thirty day3 for the said Hugh L. Lynn and Lizzie Lynn the said sum of $100.00 then said deed is to be delivered to the said Hugh L. Lynn.
“It is further provided that should the title to said land be good and merchantable in said Hugh L. Lynn and Lizzie Lynn, subject only to the above-mentioned indebtedness, then the said Jasper McCoy obligates and binds himself to pay said sum of money above mentioned to said bank above mentioned for the said Hugh L. Lynn and Lizzie Lynn. But if said title shows to be further incumbered than above set out then the said McCoy is under no obligations to accept said deed and pay said sum of money.”

Those instruments were both dated February 3, 1916, were acknowledged on the same date, and as soon as they were executed they were deposited in the First National Bank of Hamlin, where they remained until they were delivered to McCoy 'by the bank, which delivery was within the 30 days from the date of their execution. At the time they were delivered to McCoy he paid to the bank for the use and benefit of plaintiff and wife $100, as stipulated in the contract and deed. Very soon after McCoy received the deed it was duly filed for record, and shortly thereafter he sold the land to Slater; the deed to Slater being dated March 4, 1916, on which date that deed was also duly filed for record. The deed from McCoy to Slater recited a cash consideration paid to McCoy of $2,000.

The deed and contract executed by plaintiff and wife were filed with plaintiff’s petition as exhibits thereto, find the petition contains three counts: The first is in the statutory form of an action in trespass to try title. In the second count it was alleged, in substance, that on February 3, 1916, plaintiff owned a fee-simple title to the land, and was lawfully possessed thereof, and at that time the defendant McCoy was using the same as his tenant; that on said date McCoy came to plaintiff’s residence, having those instruments in his possession, which had been prepared under his direction and without the knowledge or advice of the plaintiff and his wife, both of said instruments being unsigned, but prepared for the signatures of the plaintiff and his wife; that McCoy proposed that plaintiff and his wife execute and acknowledge said instruments, and, as an inducement for them to do so, represented to them that the incumbrance against the land in favor of the Middlesex Banking Company then amounted to approximately $2,200, and that the land would be sold on the following day by 2 o’clock p. m., unless the debt was paid, or the payment thereof extended, but that if plaintiff and his wife would sign those instruments he, McCoy, would advance money, which he then had, necessary to postpone said sale, and would allow plaintiff a period of 30 days within which to get the money necessary to discharge said indebtedness, and would aid plaintiff in procuring the same; that McCoy further represented that the deed and contract would he placed in the First National Bank of Hamlin and there kept without delivery of the deed to McCoy for the full period of 30 days, in order to give plaintiff an opportunity to pay off said debt, or to sell the land to some one else, and in the event he should do either, the deeds should not be delivered by the bank to McCoy, but if plaintiff failed to procure the money, either by borrowing it, or by selling the land, within the period of 30 days, then, and not until then, the deed should be delivered to McCoy upon the payment to plaintiffs of $100 for their equity in the land, and should also pay the outstanding indebtedness against it, which was then estimated to be the sum of $2,200.

It was further alleged that McCoy represented to the plaintiff and his wife that the proposed parol agreement between the parties recited above was embodied in the written contract, and that plaintiff and his wife executed the same and the deed relying upon such statement, in ignorance of the fact that the same was false, and would not have executed it but for such assurances.

It was further alleged that plaintiff was unable to read, and that the instruments were not read over to him; that McCoy had been acting as plaintiff’s agent in earing for the land and plaintiff’s stock, and had his full confidence. It was further alleged that within 30 days from the date of the execution of said instrument, plaintiff negotiated a sale of the land to other persons, which would have enabled him to discharge the in-cumbrance against the land, and he would have done so but for the wrongful refusal of the defendant McCoy to permit him to do so, unless plaintiff would pay him the sum .of $500 for his services in securing a postponement of the foreclosure of the mortgage indebtedness; that thereupon plaintiff, in order to avoid a lawsuit, agreed to pay the amount so demanded, but his offer so to do was refused by McCoy, who then within the 30-day period above mentioned, and about the 26th day of February, 1916, attempted to place the sum of $100 to plaintiff’s credit in the First National Bank of Hamlin, and upon so doing obtained possession of the deed, and attempted to convey the land to the defendant Slater, who is now claiming the property under such conveyance, but that plaintiff had never received from the bank the money so deposited for his 'benefit.

It was further alleged that the representation by McCoy, at the time the instruments were executed, of the amount of indebtedness outstanding against the land, was grossly exaggerated; that the amount then due was less than $1,400; that the further representations that the land was then about to be sold, and would be sold on the following day under a foreclosure of said lien, and that McCoy had secured the money necessary to procure a postponement of such foreclosure, were all false, and were made by McCoy for the fraudulent purpose of deceiving plaintiff and thereby to induce the execution of the deed and contract, and that plaintiff and his wife executed said instruments relying upon the truth of the representations so fraudulently made by McCoy.

It was further alleged that by reason of the fraud so practiced upon plaintiff and his wife by McCoy there had been no legal delivery of the deed to him, and therefore the deed never became effective in favor of either McCoy or the defendant Slater.

The third count of the plaintiff’s petition contains the same allegations of fraud as are contained in the second count, with the same history of the transactions between the parties, and upon those allegations, plaintiff prayed for a cancellation of the deed from himself and wife to McCoy, and the deed from McCoy to Slater; it being alleged in that connection that at the time Slater took his deed from McCoy he had actual knowledge of the fraud so practiced by McCoy upon plaintiff, or by the exercise of ordinary care should have ¿cquired such knowledge.

Upon the trial, plaintiff introduced evidence tending, in a material respect, to sustain his allegations of fraudulent misrepresentations by McCoy, and which induced the execution of the deed and contract in favor of McCoy, and such evidence was perhaps sufficient, if believed by the jury, to sustain a judgment in plaintiff’s favor on the third count in his petition, canceling the deed to McCoy, and also the deed from McCoy to Slater, unless such relief could be avoided by Slater under the plea filed by him that he was an innocent purchaser of the land from McCoy without notice of such fraud. Plaintiff also introduced in evidence the deed and contract executed by himself and wife in favor of McCoy, and also the deed from McCoy to Slater conveying the land in controversy, all of which Instruments were introduced for the sole purpose, expressed at the time, of showing common source of title. Upon the introduction of such testimony and written instruments the plaintiff rested. Thereupon the defendant Slater announced to the court that he would introduce no evidence, and upon that announcement the introduction of testimony on the entire case was closed; and upon the evidence adduced the court gave to the jury a peremptory instruction to return a verdict in plaintiff’s favor against McCoy on his disclaimer of title, but in favor of the defendant Slater, which was done, and judgment was entered accordingly.

At the outset of appellant’s brief there is a statement of the three counts in the petition filed by him in the trial court, and following that statement is this:

“Upon the trial plaintiff elected to rely on the first and second counts of his petition, and abandoned the third count. The case of ap-pellánt rests in the single question whether or not there was a delivery of the deed to the land from appellant to the defendant McCoy under the facts adduced.”

By his first assignment, appellant insists that there was evidence sufficient to show that the delivery of the deed from himself and wife to McCoy was obtained through fraud, which would render the same void both against McCoy and Slater, and that the court erred in taking that issue from the jury. By the second and last assignment of error appellant insists that the verdict in Slater’s favor was contrary to law and unsupported by the testimony because: (1) The evidence showed that the delivery of the deed from plaintiff and wife to McCoy was founded in fraud and without authority on the. part of plaintiff and his wife, and said deed was therefore void as against both McCoy and Slater; (2) there was no evidence that Slater was an innocent purchaser for value and without notice of the fraud practiced by his vendee, McCoy; (3) that there was no testimony to show that Slater purchased the land, or that his vendor McCoy ever purchased it in view of the fact that the deeds from plaintiff to McCoy and from McCoy to Slater were introduced by the plaintiff for the sole purpose of showing common source of title. But the only proposition offered under both assignments is one presenting the single contention that the evidence showed conclusively that there was no lawful delivery of the deed from plaintiff and his wife to McCoy, thereby limiting both assignments to that single proposition, which, therefore, as stated in the outset of appellant’s brief, is the only question for our determination. In Steffian v. Milmo Nat. Bank, 69 Tex. 513, 6 S. W. 823, the following was said by Justice Gaines:

“It is elementary law that the delivery of a deed is requisite to its validity as a conveyance. To take effect, it is quite as necessary that it should be delivered as that it should be signed. To complete a delivery in its legal sense, two elements are also essential. The instrument must not only be placed within the control of the grantee, but this must be done by the grantor with the intention that it shall become operative as a conveyance. It follows from these first principles that an instrument which passes into the possession of the grantee, without such intention on .part of the grantor, is wholly inoperative; and that a purchaser from the former acquires in law no title to the property which it purports to convey. It is accordingly held that even a vendee from the grantee, who has paid value without knowledge of the facts, is not an innocent purchaser in such a case” (citing cases).

Many authorities might be cited to the same effect, such as Boswell v. Pannell, 146 S. W. 236; Id., 107 Tex. 433, 180 S. W. 593; Spotts v. Whitaker, 157 S. W. 422; Walker v. Erwin, 47 Tex. Civ. App. 637, 106 S. W. 165; Devlin on Deeds, § 322.

According to the testimony of plaintiff, himself, the parol agreement between himself and wife and McCoy was that the deed should be placed in escrow in the First National Bank of Hamlin, and should be thereafter delivered to McCoy upon the payment by the latter of the sum of 8100, and the assumption of outstanding indebtedness against the land, in the event only that plaintiff should be unable to discharge the incum-brance by a sale of the land, or by borrowing the money from other sources. The written contract between himself and McCoy also shows a specific agreement that the deed should be placed in escrow, but upon conditions differing from the alleged parol agreement as testified to by plaintiff. No evidence was introduced to show, and it is not contended by appellant here, that any fraud was practiced by McCoy in order to obtain possession of the deed from the bank after it had been deposited in escrow, but the sole contention is that the fraud which appellant insists invalidated the delivery of the deed to McCoy by the bank was the fraud practiced in the inception of the negotiations between plaintiff and McCoy, and which induced plaintiff and his wife to execute the deed and contract and place those instruments in escrow with the bank.

Plaintiff having abandoned his suit for a rescission and cancellation of the deed to McCoy, the fraud alleged can be looked to for no other purpose except to determine whether or not the delivery of the deed, which had already been executed and acknowledged, to McCoy by the bank vested the legal title in McCoy. As noted already, the written contract, which was deposited with the bank at the time the deed was deposited, expressly authorized the bank to deliver the deed to McCoy, if he should, within 30 days from the date of the instrument, pay the bank for plaintiff’s use the sum of $100. Plaintiff gave no notice to the bank of any intention to revoke the authority to so deliver the deed, nor did he give the bank any notice of the alleged fraud on the part of McCoy, which induced the execution of the deed and contract. In the absence of a rightful rescission of the written contract, McCby had the right to insist upon a delivery of the deed in accordance with the terms of the contract, and if he complied with his obligations therein expressed, equity would have enforced a delivery- of the deed, upon the theory that the equitable title had already vested in him, notwithstanding the nondelivery of the deed. In 10 R. C. L. bottom page 628, the following is said:

“The deposit of a deed in escrow creates, however, in the grantee such an equitable interest in the property, as that, upon full performance of the conditions according to the escrow agreement, the title will vest at once in him.”

To the same effect is 1 Devlin on Deeds, § 327. See, also, Moore v. Trott, 156 Cal. 353, 104 Pac. 579, 134 Am. St. Rep. 131; Wilkins v. Somerville, 80 Vt. 48, 66 Atl. 893, 11 L. R. A. (N. S.) 1183, 130 Am. St. Rep. 906, and notes.

Even though it could be said that proof of the alleged fraud on the part of McCoy would warrant a rescission of the written contract deposited with the bank, the facts so proven would not, ipso facto, work a revocation of, the authority expressly given to the bank by the written contract to deliver the deed to McCoy within the 30-day period from its date upon payment to the bank for plaintiff’s use of the sum of $100; and in the absence of some proof of fraud on the part of the bank in delivering the deed to McCoy, or some fraud practiced by McCoy upon the bank in order to procure a delivery of the deed by the bank, the authority given to the bank by the written contract to deliver the deed continued in full legal force and effect, and the delivery made in pursuance thereof vested the legal title in McCoy with power to convey to Slater.

If, as contended by appellant, the alleged fraud by McCoy, which induced the execution of the instruments, would render void the subsequent delivery thereof by the bank, notwithstanding such delivery was made in pursuance of the authority given to the bank by plaintiff and his wife, then it would follow that every deed procured by fraud would be void as against an innocent purchaser. If a vendee sells property and delivers, or authorizes a delivery of, a conveyance thereto, he thereby voluntarily conveys the legal title to the vendee, and the deed will be given that effect, even though he may have equitable grounds for a cancellation of the instrument on the ground of fraud, accident, or mistake inducing the execution of the deed and voluntary delivery, but he cannot assert such right of rescission against an innocent subsequent purchaser of such legal title from his vendee. But that rule is predicated upon the fact that the vendor has in fact voluntarily conveyed the legal title to the vendee, and thereby vested him with» authority to sell the property to another. If, however, the vendor executes the deed and does not deliver it, or authorize its delivery, then the legal title never vests in the vendee named in the instrument, but the instrument is a nullity, having no more effect than if it were a forgery, and therefore will not furnish a predicate for a plea of innocent purchaser from the vendee named in such instrument.

For the reasons stated, we overrule appellant’s contention that there was no lawful delivery of the deed to McCoy, and that therefore the legal title to the land in controversy never vested in him.

Accordingly, the judgment of the trial court. in favor of .defendant Slater is affirmed, and the judgment in favor of plaintiff against the defendant McCoy, of which no complaint is made, is undisturbed as to McCoy.

CONNER, C. J., not sitting, serving on writ of error committee at Austin.
      cS=>For other cases see same topic and KEY-NUMBER in all Key-Numhered Digests and Indexes


author: HALL, J.

text:
    WESTERN UNION TELEGRAPH CO. v. LOVE & WALTERS.
    (No. 1281.)
    (Court of Civil Appeals of Texas. Amarillo.
    Jan. 30, 1918.)
    1. Appeal and Error i&wkey;742(2) — Briefs—Assignments oe Error.
    Where appellant grouped in its brief several specifications of error in the motion for new trial, to the effect that addressee of a telegram should not have been misled, and that the question was one of law for the court, but left out the fact that the court had refused to give a directed verdict, the grouping was multifarious and the propositions not germane, because such propositions only raised the question of contributory negligence of the addressee, and did not not point out any error of the court.
    2. Telegraphs and Telephones <&wkey;66(l) — Notice oe Claim-Pleading.
    It will be presumed that a requirement of a telegraph company that notice of claim be made within a specified time has been complied with, unless failure to do so is specially pleaded, under Vernon’s Say les’ Ann. Civ. St. 1914, art. 5714, relating to notices of Haims for damages.
    3. Telegraphs and Telephones <&wkey;56(2) — Liability oe Company eor Errors in Message.
    The rule that a telegraph company is not liable to the sender on account of a purchase by the sendee through errors in a message, and that the sender is not liable to the sendee, has no application to an action by the sender who has been assigned the claim of the sendee.
    4. Telegraphs and Telephones <&wkey;56(3)— Satisfaction oe Claim by Titird Person.
    That sender and sendee of telegram arbitrated a loss caused by error in a message, before a board which decreed that they should share in loss equally, did not estop the sendee from suing the telegraph company.
    5. Telegraphs and Telephones &wkey;>56(2) — Errors in Message — Assignment oe Claims.
    A purchase by a sender of a telegram for a valuable consideration of a claim of the sendee due to error in message does not extinguish the claim against the telegraph company, in an action by the sender as assignee.
    '6. Telegraphs and Telephones &wkey;>70(l) — Payment oe Claim: by Third Person.
    That sender of telegram paid to sendee half of loss caused by error in message did not render the telegraph company liable to sendee for less than the whole loss.
    Appeal from District Court, Collin County.
    Suit by Love & Walters, a firm composed of C. D. Love and G. C. Walters, as assignees of Kreitmair & Co. of Liverpool, England, against the Western Union Telegraph Company. Judgment for plaintiffs, and defendant appeals.
    Affirmed.
    . Flippen, Gresham & Freeman, of Dallas, for appellant. Merritt & Merritt, of McKinney, for appellees.
   HALL, J.

This is a suit by Love & Walters, a firm composed of C. D. Love and G. C. Walters, as assignees of Kreitmair & Co., of Liverpool, England, of a claim for damages against appellant company. Appellees sue for damages in the sum of $767, on account of the negligence of appellant in the transmission of a telegram sent by appellees from McKinney, Tex., to Kreitmair & Co., at Liverpool, England, and for $2.52 charged appellant for the transmission of said message. Appellees set up the facts constituting their cause of action substantially as follows: That plaintiffs were at the times herein mentioned engaged in the business of buying and selling cotton to various persons and firms in the United States and foreign countries, including the firm of Kreitmair & Co., of Liverpool, England, and the said firm of Kreit-mair & Co. were likewise engaged in said business. That said business was conducted by means of telegrams or messages sent and received from the Western Union Telegraph Company’s lines, which messages were in the English language and the contents thereof known to said company, its servants and agents, and all said facts were known to said company. That the market price of cotton, both in the United States and in Liverpool, England, was subject to change and fluctuation from day to day. That the Western Union Telegraph Company owned, controlled, and operated a line of telegraphic communication from McKinney, Tex., to Liverpool, England, over which it transmitted messages generally for the public for hire. That on November 11, 1914, having and desiring to sell a hundred bales of good middling, root staple cotton, at 4.73d., or 9.46 cents per pound, sent Kreitmair & Co. at Liverpool, England, over the lines of the Western Union Telegraph Company, the following message:

“No. 1: Offer two hundred fully mids full eighths four sixty, one hundred mist four eighty five, hundred root four seventy three, answer quick”

—meaning and intending to offer for sale to F. Kreitmair & Co. with other grades of cotton 100 bales of root staple cotton at 4.73d., or 9.46 cents per pound, said message being so understood by F. Kreitmair & Co. That said Kreitmair & Co., desiring to purchase said 100 bales of root staple cotton, and in addition thereto 100 additional bales of said cotton at said price, sent to Love & Walters over the line of the Western Union Telegraph Company, the following reply:

“No. 2: Accept hundred good middling full eighth strictly equal root four seventy three, and bid same price further hundred, sixty days, Parrs, reply quickly”

—meaning and intending to accept said offer of 100 bales of root staple cotton at 4.73d., or 9.46 cents per pound, and to bid the same price for 100 additional bales of said cotton, payment therefor to be made through Parr’s bank, and said message was so understood by Love & Walters, but Love and Walters having and desiring to sell only 100 bales of said cotton, on November 12, 1914, sent to Kreit-mair & Co. over the line of the Western Union Telegraph Company the following message:

“No. 3.- We confirm sale hundr’ed. Make offer on fully mids”

—meaning and intending thereby to confirm, the sale to F. Kreitmair & Co. of only 100 bales of said root staple cotton, and the said F. Kreitmair, on said date, in order to make clearer, if possible, and confirm the number of bales of said root staple cotton Love & Walters had sold them, sent’ to Love & Walters over the line of the Western Union Telegraph Company, the following message:

“No. 4. Presume your confirmation refers to hundred good middling root staple we accepted and hundred same quality we bid for, together two hundi’ed, reply. We now bid four fifty hundred fully middling full eighth prompt shipment, sixty days, Parrs, reply quickly”

■ — meaning and intending thereby to inform Love & Walters that they (F. Kreitmair & Co.) understood Love & Walters had agreed to sell them 200 bales of good middling, root staple cotton, and not only 100 bales of said cotton, and which message was so understood by Love & Walters, but Love & Walters only having 100 bales of said cotton, and having only agreed to sell 100 bales in order to make clearer, if possible, to Kreitmair & Co. that they had agreed to sell them only 100 bales of said cotton on said date delivered to Western Union Telegraph Company at McKinney, for transmission and delivery to F. Kreitmair at Liverpool the following message:

“No. 5. Confirmation refers to hundred .you accepted not two hundred. Offer fully mids to low”

—meaning and intending thereby to inform F. Kreitmair & Co. that Love & Walters had agreed to sell them only 100 bales at said price per pound, being the market price of said cotton at Liverpool on said date, and said cablegram would have been so understood by F. Kreitmair & Co. had it been delivered to them at Liverpool in the form as originally written and delivered to the Western Union Telegraph Company at McKinney. That Love & Walters and F. Kreitmair & Co. paid the Western Union Telegraph Company the price charged for the transmission and delivery of said messages and Love & Walters paid the Western Union Telegraph Company $2.52, the price charged for the transmission and delivery of said last message.. That the Western Union negligently failed to transmit and deliver the message last above mentioned, as written, and in the form delivered to it at McKinney, but carelessly and negligently changed its wording and delivered in its stead to F. Kreitmair & Co. at Liverpool, the following message:

“No. 6. Confirmation refers to hundred you accepted to two hundred. Offer fully mids to low.”

That the message as delivered to F. Kreit-mair & Co. meant and caused them to understand and believe that Love & Walters had' sold them 200 hales of cotton at 4.73d. or O.46 cents per pound. That the same would be delivered to them under said contract, and, acting upon said belief and advice, P. Keitmair & Co. contracted with other parties for the sale to them of said 200 bales of good,' middling, root staple cotton. That on or about January 20, 1915, Love & Walters and P. Kreitmair & Co. for the first time discovered that said last-mentioned message had been changed in transmission, and that Love & Walters had agreed to sell Kreitmair' & Co. oniy 100 bales of said root staple cotton, and the market price of said cotton had greatly advanced, and Love & Walters, being unable to furnish said additional 100 bales of said cotton, and Kreitmair & Co. being unable to buy same for a 'less price, Kreitmair & Co., in order to fill their contract of sale to other parties of said additional 100 bales, and in order to protect themselves against further loss, immediately, and on January 20, 1915, went into open market at Liverpool, England, and purchased 100 bales of cotton of a- like kind and quality as the 100 bales of root staple purchased from Love & Walters, but, instead of being able to purchase same at 4.73d. or 9.46 cents per pound, Kreitmair & Co. were compelled to pay for said 10(> bales 5.49%d. or 10.99 cents per pound, which was the market price of said cotton in Liverpool, England, on said date, making a difference of .76%d., or 1.53 cents per pound they had to pay for said cotton above the price at which they were led to believe and understand they had purchased same by said message, or the sum of £159 7s. 6d., being the sum of $767 in excess of the price at which they actually purchased the 100 bales of said cotton from Love & Walters. That by the exercise of due diligence the Western Union Telegraph Company could have delivered the message in the form as originally written, and had it been so delivered, E. Kreitmair & Co. would not have sold said 100 bales of cotton to other parties in addition to the 100 bales actually purchased from Love & Walters, and would not have been compelled to go into the open market on January 20, 1915, and buy 100 bales of said cotton to fill their said contract at said loss of £159 7s. 6d., and would not have sustained said loss. That F. Kreitmair & Co. have transferred and assigned to Love & Walters all claims for damages arising out of said matter and transaction, and Love & Walters are the owners of same. That said loss of $767 was sustained by F. Kreit-mair & Co. as a direct and proximate result of said negligence of said Western Union Telegraph Company.

The defendant answered by demurrers, general and special, which were not urged, and alleged further, in substance, as follows: It set forth the terms of the contract printed on the back of the message blank, and especially this provision:

“It is agreed that this company shall not be liable for damages in any case where the claim is not presented to it in writing within ninety-five days after the cause of action, if any, has arisen”

—and alleged that the claim was not presented to it within the time specified. ,The answer further sets up the defense of contributory negligence upon the following grounds: (1) There was no acceptance or confirmation of the offer for an additional 100 bales of Kreitmair & Co. by Love & Walters ; (2) because the cablegram actually received by Kreitmair '& Co. was sufficient to put them on notice that they had bought only 100 bales originally offered by Love & Walters, and that Love & Walters had not accepted their counter offer for an additional 100 bales; (3) because the correspondence between Love & Walters and Kreitmair & Co. was enough to put them on notice that they had purchased only 100 hales from Love & Walters; (4) because the message sued on and actually received by Kreitmair & Co. was sufficient to put them on notice, and require of them the duty to make inquiries with reference thereto if not clear to their minds; (5) Kreitmair & Co.’s failure, on receipt of said message sued on, to send a further and additional cablegram to Love <& Walters for a more definite confirmation was a bar to any recovery thereon, and such failure was a proximate cause of the loss claim- . ed rather than the mistake made in the transmission of the message by defendant.

Upon a trial before a jury, a verdict in the sum of $841.50 was returned in favor of plaintiffs.

Appellee objects to the consideration of appellant’s first assignment of error, upon the ground that it fails to distinctly specify any ground of error and to direct the court’s attention to any alleged error. This assignment is subject to the further objection that it combines separate and distinct specifications of alleged error, is multifarious, and the propositions under it are not germane. This assignment is made up of a portion of the twelfth ground and the thirteenth ground of appellant’s motion for a new trial. The 'first paragraph of the twelfth ground is:

“Because the court erred in failing and refusing to give this defendant’s special charge No. .1, wherein the defendant asked the court to charge the jury as follows: ‘You are charged that the law and evidence in this case are with the defendant and yon will therefore return a verdict for the defendant.’ ”

This part of the twelfth ground is not transcribed in the brief, and the only portion of this ground is the third subdivision, as follows:

“Third. Because it does not appear from the language in the said quotation or otherwise in plaintiff’s amended petition that F. Kreitmar & Co. had any right tc be misled from the language of the message complained of in the portion of the plaintiff’s amended petition quoted in the last paragraph on page 5, and at top of page 6, in plaintiff’s amended petition, as said message plainly tells the addressee that their offer referred only to 100 bales, and the offer for the additional 100 bales was too low, and the defendant says that this defendant, even if it was guilty of negligence, as claimed, in the delivery of said message, that, it could not have contemplated that addressee would want to go into the market and buy an additional 100 bales, when plaintiffs .wired them they only had 100 bales for sale, and the defendant says that plaintiff’s amended petition shows that the addressee never thought or contemplated the loss complained of herein until long after such time as by the use of ordinary care and reasonable diligence that they might have known the same, either by wire or mail, if the contents of said message was confusing to them or there appeared to be some error to it.”

Thé thirteenth ground of the motion is as follows:

“Because the court erred in submitting to the jury as a proposition of fact the construction of said message, it being the duty of the court to construe the message alleged to have been changed negligently in transmission, and not a question of fact for the jury.”

It is clear that these two assignments are not properly grouped. Without the first part of the twelfth ground of the motion for new trial no error whatever is presented, and no complaint is made of any action of the court. If there is any objection whatever it is that Kreitmair & Co. were not warranted in concluding from the language of some quotation in the pleading, not here set out, that only 100 bales of cotton had been offered; that they were not warranted in buying 100 bales in the open market, and, further, that plaintiff never thought of the loss until long after such time as by the use of reasonable diligence they might have known that there was some error in the cablegram. The purpose of an assignment ordinarily is to complain of some error of the trial court, and not of a want of understanding on the part of the opposing party or of the failure of such party to use diligence. The propositions under this assignment raised the issue of contributory negligence on the part of appellee and Kreitmair, in failing to ascertain whether or not the message had been correctly transmitted, and in guessing at the meaning of ambiguous messages, resulting in the aggravation of their alleged damages. These propositions are certainly not germane to any part of the two assignments quoted above.

By the second assignment of error appellant insists that appellees are not entitled to recover because they failed to notify appellant of their claim for damages within the 95-days period found on the back of the messages. The rule is that where notice of a claim for damages is required to be given, it is presumed that such notice was given, unless the failure to do so is specially pleaded under oath. • Vernon’s Sayles’ Civil Statutes, art. 5714. Appellant’s pleadings do not comply with this requirement of the statute, and the fact of notice or no notice cannot be questioned.

The third assignment covers more than eight pages of appellant’s brief, and is made up of 12 distinct and separate paragraphs, copied from the motion for new trial. Many of these are argumentative, present no error, and should not have been grouped. The propositions, however, following this assignment, may be appropriately based upon one or more of the grounds set out.

The first proposition is that a telegraph company, which incorrectly transmits a message, is not liable to the sender on account of a purchase made by the sendee in obedience to an error in the message, and, further, that the sender would not be bound under the law to make'good the loss of his sendee by reason of the negligence, if any, of the telegraph company. We think both propositions are correct, but they have no 'application to the facts of this ease. The second proposition under this assignment is that:

“Appellees not being liable for the alleged loss of Kreitmair 8} Co., the payment of said losses by appellees was voluntary and gratuitous, and therefore they have no cause of action against appellant.”

Appellees did not base their suit upon damages alleged to have accrued to them by reason of the error in the messages transmitted. They alleged and admit that Kreitmair & Co. were primarily injured by the negligence of appellant, and this suit is filed by them as assignees of Kreitmair & Co. We find in the record a written assignment from Kreitmair & Co. to appellees of their claim for damages.

It was shown by the evidence that for the sake of harmony in their business relations with Kreitmair & Co. appellees submitted to an arbitration before some kind of a board, organized for that purpose in Liverpool, of the matter of the loss growing out of appellant’s negligence; that a board of appeals supervising the action of the board of arbitration decreed that appellees and Kreitmair & Co., as between themselves, should share the loss equally, and appellant seeks to defend upon the ground that the result of this award is a satisfaction of appel-lees’ claim, and that appellees and Kreitmair & Co. are estopped from urging their claim against it. In our opinion this is a matter with which appellant is not concerned. As stated in R. C. L. p. 554, § 105:

“As a general rule, partial compensation received from a collateral source, wholly independent of the wrongdoer, cannot operate to lessen the damages recoverable from the latter. * * * So a wrongdoer will not be permitted to benefit by payments made to the injured person from collateral sources, whether in compensation or as a gratuity.”

This rule has been adopted by the courts of this state. G., C. & S. f. Ry. Co. v. McKinnell, 171 S. W. 1091; Lipscomb v. H. & T. C. Ry. Co., 95 Tex. 21, 64 S. W. 923, 55 L. R. A. 869, 93 Am. St. Rep. 804; Texas Central Ry. Co. v. Cameron, 149 S. W. 709.

The fourth assignment of error is predicated upon the supposition that the purchase by appellees of Kreitmair & Co.’s claim for damages was a satisfaction of the claim. No such result was ever intended by the parties to the assignment, and as a matter of law the effect of a transfer of the claim for a valuable consideration did not work an ex-tinguishment of it.

Under the fifth assignment it is contended that appellant is responsible to appellee for only the difference between the loss suffered by appellees’ assignor by reason of their purchase of the extra hundred bales on the open market and the amount paid the assignors by appellee under the arbitration award. This is not a sound proposition because appellant is responsible for the damages proximately resulting to Kreitmair & Co. without regard to any subsequent transactions between appellee and Kreitmair tending to adjust matters concerning them alone.

Finding no reversible error, the judgment is affirmed.
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