author: MeMEANS, J.

text:
    HOUSTON OIL CO. OF TEXAS v. PAYNE et al.
    (Court of Civil Appeals of Texas. Galveston.
    Jan. 30, 1914.
    Rehearing Denied Feb. 26, 1914.)
    1. Principal and Agent (§ 117) — Conveyance by Agent — Necessity that Agent’s Authority be in Writing.
    Written authority is not necessary to enable an agent to bind his principal by an ex-ecutory contract for tbe sale of lands.
    [Ed. Note. — For other cases, see Principal and Ag^ent, Cent. Dig. §§ 378-390; Dec. Dig. ]
    .2. Frauds, Statute oe (§ 116) — Sale oe Land by Agent — Necessity That Agent’s Authority be in Writing.
    Rev. St. 1895, art. 624, declaring that no estate or inheritance or freehold, etc., in lands and tenements shall be conveyed except by an instrument in writing, subscribed, etc., by the grantor, or by his agent thereto authorized in writing, does not prevent an agent from binding his principal by a parol sale under all circumstances.
    [Ed. Note. — For other cases, see Frauds, Statute of, Cent. Dig. §§ 251-260; Dec. Dig. §
    3. Corporations (§ 432*) — Power oe Agent —Conveyance—Evidence.
    In an action for land, evidence held to show that an agent of a land and lumber company, a corporation, had authority to bind the company by a verbal sale of land.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 1717, 1718, 1724, 1726-1735, 1737, 1743, 1762; Dec. Dig. § 432.*]
    4. Corporations (§ 432*) — Evidence as to Authority oe Agent — Course oe Dealing.
    Authority of an agent to act for a corporation may be shown by a course of dealing in which the acts of the alleged agent were known and recognized by the corporation.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 1717, 1718, 1724, 1726-1735, 1737, 1743, 1762; Dec. Dig. § 432.*]
    5. Frauds, Statute oe (§ 137*) — Operation and Effect — Part Performance — Parol Sale of Land.
    Where defendant, in pursuance of a parol contract with the agent of a land and lumber, company, whereby the agent agreed to give defendant 160 acres of a certain survey if defendant would look after and keep trespassers off the company’s land, performed his part of the contract and took possession of and erected permanent and valuable improvements upon the 160 acres, he acquired an equitable title which the court will protect.
    [Ed. Note. — For other cases, see Frauds, Statute of, Cent. Dig. §§ 301-326; Dee. Dig. § 137.*]
    6. Frauds, Statute of (§ 129) — Part Performance-Possession under Parol Sale.
    A vendee under a parol sale of land, by permitting his vendor to thereafter enter and remove the timber, as was provided by the contract, did not thereby yield posession so as to affect his equitable title under the parol sale.
    [Ed. Note. — For other cases, see Frauds, Statute of, Cent. Dig.\ §§ 287-292, 303, 306-308, 311, 314, 318-320, 322, 325, 326; Dec. Dig. § 129.]
    7. Appeal and Error (§ 1041) — Review— Harmless Error.
    Where defendant’s original answer alleged that plaintiff’s agent had express authority to make the contract in controversy, any error in permitting defendant at the trial to amend so as to allege that the agent had implied authority, etc., and refusing plaintiff a continuance, was not prejudicial, where the agent on the stand admitted that he did have express authority.
    [Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 4106-4109; Dec. Dig. § 1041.]
    8. Evidence (§ 471) — Conclusions and Matters op Opinion — Authority op Agent.
    The testimony of a corporation’s agent, to the effect that he had full authority to contract with any person with respect to the company’s titles which in his judgment was best for the company’s interest, and that he represented the company in Texas as though he were the sole officer, etc., were not conclusions of the witnesses, but statements of fact.
    [Ed. Note. — For other cases, see Evidence, Cent. Dig. §§ 2149-2185; Dee. Dig. § 471.]
    9. Appeal and Error (§ 1050*) — Evidence (§ 471) — Review—Harmless Error.
    Though it wex-e error to permit the general manager of a corporation to testify that the duties of his office where such as the title signified, and as were usually exercised by the manager of a corporation, because a conclusion, it was not prejudicial, where he stated all the facts as to his authority.
    [Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 1068, 1069, 4153-4157, 4166; Dee. Dig. § 1050;* Evidence, Cent. Dig. §§ 2149-21S5; Dee. Dig. § 471.]
    10j. Corporations (§ 432) — Evidence as to Authority op Agent.
    It is not necessary that the authority of an agent of a corporation be shown by a record or recital of corporate action, but it may be conferred by a vote of the directors not entered of record, or by a course of dealing.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 1717,1718, 1724, 1726-1735, 1737, 1743, 1762; Dec. Dig. § 432.]
    11. Appeal and Error (§ 732) — Assignment op Errors — Specification op Errors.
    An assignment that the court erred in overruling appellant’s motion for a new trial, which contained 63 grounds, was too general.
    [Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 3022-3024; Dec. Dig. § 732.]
    Appeal from District Court, Tyler County; A. E. Davis, Judge.
    Action by the Houston Oil Company of Texas against J. B. Payne and others. Judgment for defendants, and plaintiff appeals.
    Affirmed.
    Hightower, Orgain & Butler, of Beaumont, and H. O. Head, of Sherman, for appellant. J. A. Mooney, of Woodville, and Jno. G. Logue, of Houston, for appellees.

      For other cases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep’r Indexes

      For other cases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep’r Indexes

   MeMEANS, J.

This is an action of trespass to try title, brought by appellant, Houston Oil Company of Texas, against appellee J. G. Payne and others, as defendants, to recover about 600 acres of land known as the E. T. Ry. survey No. 7 in Tyler county. The defendants disclaimed as to all the land sued for except 160 acres described by metes and bounds in their answer, or in the alternative for 160' acres to be set apart to them so as to include their improvements. The answer included a plea of not guilty as to this 160 acres, and also a plea of the 10-year statute of limitation, and a further special plea to the effect that the Texas & Louisiana Land & Lumber Company, the common source, through its agent, John H. Kirby, about the year 1896 entered into a verbal agreement with defendant J. G. Payne that he, Payne, should render such assistance to the lumber company as he could in the sale of the land and the timber thereon, and should look after the timber on the lands of said company in the vicinity, keep trespassers off, protect from depredation, and generally oversee and take care of said lands and timber, and that for such services the defendant Payne should have, by fee-simple title, 160 acres of said survey No. 7, then and there agreed upon as the 160 acres of said survey adjoining the O. Hulett survey. They further alleged compliance in good faith.by Payne of his part of the agreement, and the erection of permanent and valuable improvements by him on the land conveyed in reliance upon the contract. No evidence was introduced in support of the defendants’ plea of limitation of 10 years, and this defense seems to have been entirely abandoned. The case was submitted to a jury on special issues, and upon the coming in of the verdict judgment was rendered in favor of the defendants for the 160 acres described by metes and bounds in their answer, and in favor of plaintiff for the balance of the survey, and from this judgment the plaintiff has appealed.

By its first assignment of error appellant complains of the refusal of the court to give its special charge instructing the jury peremptorily to return a verdict in its favor.

By its first proposition under this assignment appellant asserts that the claim of parol sale being asserted through acts of an agent-of the owner, it was necessary to show that such an agent had written authority. This contention cannot be sustained. Written authority is not necessary to enable an agent to bind his principal in an executory contract for the sale of lands. Huffman v. Cartwright, 44 Tex. 299; Marlin v. Kosmyroski, 27 S. W. 1044; Tyler Building & Loan Ass’n v. Forse, 59 S. W. 819.

Appellant, being aware that the rule above stated is laid down in the two eases first cited above, argues that the first of these was decided before the adoption of article 624, Revised Statutes of 1895, which restricted agency in the matters of land sales to those “thereunto authorized in writing,” and that the Kosmyroski Case followed the Cartwright Case without reference to the statute. It contends that if, under the statute of frauds, no writing is necessary to authorize ap agent to make a valid ex-ecutory contract in writing relating to lands of his principal, the rule would clearly be different if the statute of frauds required written authority, and that the statute in question clearly requires a writing. The 'statute referred to is as follows: “No estate of inheritance or freehold, or for a term of more than one year, in lands and tenements, shall be conveyed from one to another, unless the conveyance be declared an instrument in writing, subscribed and delivered by the party disposing of the same, or by his agent thereunto authorized by writing.” This article is applicable to the owner as well as the agent; and, if appellant’s contention is correct, a parol sale by an owner could not be enforced by the purchaser under any circumstances. We think this contention is untenable.

By a second proposition under the first assignment appellant asserts that: “The Texas & Louisiana Land & Lumber Company being a corporation, the evidence is insuffi•cient tó show authority in the witness Kirby, by parol ’ contract and his conduct thereunder, to divest it of title to land.” The Texas & Louisiana Land & Lumber Company is the common source of title. The undisputed evidence shows that the appellant acquired the legal title to all of survey No. 7 by deed dated July' SO, 1901, which must prevail unless the defendants have shown an equitable title to have been acquired by defendant Payne under a verbal sale made by him with John H. Kirby, agent for the lumber company prior to that date. At the risk of being tedious we here set out the testimony of Kirby in regard to the authority possessed .by him in the management and disposition of the lumber company’s lands:

“I was connected with the Texas & Louisiana Land & Lumber Company from the time it was chartered under the laws of the state of Maine, in about the year 1886 or 1887, until its dissolution about the year 19Ó1. I was one of the original promoters of the company, and afterwards became largely interested in its capital stock. Immediately upon its organization I was engaged as land agent and attorney in Texas, representing it in all local matters connected with its titles, doing all of its legal work, purchasing lands for its account, and selling the timber thereon for its account. At a later period, and about the year 1889, 1899, or 1891, its manager in Texas, Maj. Clarendon Harris, having died, I, in addition to my duties as land, agent and attorney, succeeded to the duties of manager of its property, business, and affairs. * * * I continued in my capacity as manager and attorney from 1889, 1890, or 1891 until the dissolution of the company., in 1901. The company had no- representative in Texas other than myself after the death of Maj. Harris, already testified about. * * * I was land agent and attorney * * * from the-time the company was organized in 1886 or 1887 until the death of Maj. Harris. * * * Immediately upon his death I was appointed by the company to succeed him, and continued in such capacity until the dissolution of the company in 1901. * * * Its corporate headquarters were in Portland, Me. Its business headquarters in Boston, Mass., and its Texas headquarters in my office, first at Woodville, Tyler county, Tex., from the time of its organization until 1S90, and from 1890 to 1901 at my office in Houston, Tex. The corporate officers of the Texas & Louisiana Land & Lumber Company never at any time changed. The directors were-, at the time of organization, and in all subsequent years by re-election, Edward Ellerton Pratt, Horatio R. Fletcher, and Nathaniel D. Silsbee, all of Boston, Mass. The president was Nathaniel D. Silsbee, the treasurer was H. R. Fletcher, and I was at all times land agent and attorney. Maj. Clarendon Harris, also of Boston, held the title .of manager from the incorporation of the company in 1886 or 1887 until the time of his death in 18S9 or 1S91. After his death I succeeded to his duties. I did hold the position of general manager of said company. I have already stated that it began on the death of Maj. Harris and ended when the company was dissolved. * * * The duties of the position of general manager were such as the title signifies, and as are usually exercised by a manager of a corporation. I was the only representative in Texas, and had full control of all of the properties, business, contracts, operations, and all that sort of thing in this state. I represented the interest of the company in Texas, from the time of its organization up to the time of its dissolution, as completely as though I had been the sole officer of the corporation. I always reported my action to the hoard, but I cannot recall a single instance when that action did not meet with their full approval.
“The company was engaged in buying and selling timber and timber lands in Tyler county, Tex., and in other counties of Texas, from the year 1886 or 1887 until the latter part of the year 1901. About July, 1901, it sold its land to the Houston Oil Company, and, after collecting its bills for timber previously sold, retired from business, and was regularly dissolved under the laws of the state of Maine. I was present at Portland, Me., and aided in the passage of the resolutions necessary to the dissolution and in the winding up of its affairs. * * * We sold timber to a number of the milling concerns operating in that county, and among them the Village Mills Company, the Warren Lumber Company, the Seneca Lumber Company, the Summit Lumber Company, the Yellow Pine Lumber Company, the Southwestern Lumber Company at Mobile, and several firms and partnerships. * * * I had everything to do with the timber lands belonging to the Texas & Louisiana Land & Lumber Company and located in Tyler county, as well as in other counties in Texas. I bought them for the company, employed cruisers and other experts necessary to determine the quantity of the timber before the purchase was made, passed on the titles as attorney for the company, and arranged every detail in connection with the purchase. Thereafter, as the agent of the company, I represented its lands, negotiated sales of the timber, protected them against trespassers and squatters, and did all other things that were done in taking care of the properties, including the rendition of the lands for taxes and the payment of the taxes. * * * I had full authority from the Texas & Louisiana Land & Lumber Company to make any agreement with any person in respect to any of their titles which in my business or legal judgment was best for the company’s interests. * * * I had full authority to employ any persons to look after the timber of said company and pay them such compensation as I saw proper. The directors and officers in Boston left the whole matter to my business and legal judgment. * * * I cannot testify as to the number of instances in which we gave squatters- the land, reserving to ourselves the timber, where the squatters were asserting claims to the lands owned by the company. In those days we did not regard the fee title to lands as of much consequence. Possibly $1 per acre represented their value and where the squatter was willing to concede to us the timber, it was cheaper to make such arrangement than to litigate him and take the chance of losing any part, of what we regarded as practically the whole value of the land, to wit, the timber. * * * I have already answered that I had full authority in all this period to represent the Texas & Louisiana Land & Lumber Company most fully in Tyler county in respect to its interests in Tyler county as well as elsewhere. Maj. Harris, a Boston man, was engaged in stock raising in Tyler county, and even though he held the title of manager of our land and lumber company, he left substantially everything to me, and no other representative of the Texas & Louisiana Land & Lumber Company was ever in Texas, except one time in 1893 or 1S94 I brought with me from Boston our president, Nathaniel D. Silsbee, who spent a few weeks with me in Texas. * * * I did recognize that Mr. Payne was entitled to a portion of this tract of land, and my impression was that the Texas & Louisiana Land & Lumber Company had made him a conveyance. I did not know that we had not done so until the matter was brought to my attention recently, that is, within the past three or four years. I recognized his right to it because of my understanding with him about which I had already testified. * * * I cannot detail all the transactions had in this period of 14 years of active business, and relating to more than 100,000 acres of lands in Tyler, Polk, Jasper, Newton, Hardin, and other East Texas counties. We had at different times during this period probably 100 men in our employ looking after our lands, scaling our logs, collecting for trespasses, negotiating and adjusting with squatters, and in every instance where a squatter was willing to enter into an arrangement under which he would not claim the timber, we donated to him an amount of land in settlement of his claims. I do not remember ever to have litigated a squatter except where he refused to recognize my company’s right to the timber.”

It is not necessary to show in every case that the agent who acts for a corporation was empowered to do so by a resolution of the board of directors entered of record; but as was said by the Supreme Court in Fitzhugh v. Land Company, 81 Tex. 306, 16 S. W. 1078, “the directors may confer the authority by by-law or resolution, or probably by a vote not entered of record,” or as said by this court in Tyler Building & Loan Association v. Forse, 59 S. W. 818, such authority may be shown by a course of dealing in which the acts of the alleged agent were known and recognized by the party sought to be charged, such .party receiving the benefits of the agent’s acts, and permitting him to continue so to act. See, also, Collins v. Cooper, 65 Tex. 461; Hamm v. Drew, 83 Tex. 77, 18 S. W. 434.

By a third proposition under the first assignment appellant urges that: “In order to avoid the statute of frauds as to land sales, whether as plaintiff or defendant, the evidence of the contract and essential equities ought to be satisfactory and convincing, and should show a definite agreement, ascertaining the land and specifying the obligation of the vendee, followed by exclusive possession, originating under and taken in pursuance of the contract, and accompanied by improvements constructed in reliance on the contract, or by other elements of estoppel, and that lack of any of these essentials defeats the supposed vendee’s claim.”

We think that the record shows that all the essential elements required to be proved to establish an equitable title under a parol sale of the land was proved on the trial. On this issue the following fact findings are warranted: During 1896, defendant Payne owned the O. Hulett survey in Tyler county, but was living upon the G. I. Miller, which adjoined it. Previously Payne had inclosed about an acre of the E. T. Ry. survey No. 7. The following map will illustrate the situation of the three tracts on the ground and the contention of the parties:

Kirby, as the agent of the lumber company, ascertaining that Payne was claiming survey No. 7, or a part of it, made a verbal contract with him, by the terms of which Kirby for his company agreed to give Payne 160 acres of survey No. 7 adjoining the O. I-Iulett survey, to take in the “boot-shaped piece,” and run back far enough to make the 160 acres, in consideration, as Kirby testified, that Payne “would act as a sort of scout and see that no timber was cut upon the tract of land, or other tracts of land, that we owned in this neighborhood, and see that •no trespassing was committed thereon, and report to me any such trespassing, or any effort to inclose our lands,” and “not at any time assert any claim or interest in the timber on any part of section No. 7.” Kirby further agreed, as he testified, “that when the company got the timber from the land, they would make him a proper deed for a certain part of the section, including his improvements, whatever they were.” Acting on the faith of this agreement, Payne continued in possession of the land, and made permanent and valuable improvements on that part of survey No. 7 awarded to him in this suit, and performed his agreement with Kirby to look after the lands and keep off trespassers, and in all other respects. In 1901 the Texas & Louisiana Land & Lumber Company sold the entire survey No. 7 to the appellant, Houston Oil Company of Texas, and at the time of such sale Payne was in possession of the 160 acres claimed by him, and his possession and the character of the improvements theretofore placed thereon by him and then existing was of such character as to put the oil company upon notice of his claim, or upon inquiry, which, if pursued, would have led to a knowledge of Payne’s title. After its purchase, the oil company, or its assigns, cut the timber from the tract claimed by Payne without protest upon his part. No deed was ever made by the lumber Company, or its successor in title, conveying to Payne the 160 acres in suit. As before stated, Kirby, as agent for the lumber company, was shown to have had authority from his principal to make the coUtract. The land at the time of the verbal agreement between Kirby and Payne was worth about ?1 per acre, and the value of the improvements placed thereon by Payne on the faith of the agreement were permanent in character, and exceeded in value the value of the land. Payne continued in possession from the date of the contract until the institution of this suit, a part of the time through tenants. The 160 acres described by metes and bounds in his answer included the “boot-shaped” part of the section, and ran far enough back to take in the 160 acres, and the land that was awarded to him was run out in this manner, and the jury found it to be a fair, just, and reasonable location thereof. We think that the evidence fully meets every test necessary to support the judgment rendered in favor of appellees. Wells v. Davis, 77 Tex. 636, 14 S. W. 237; Wooters v. Hale, 83 Tex. 563, 19 S. W. 134; Murphy v. Stell, 43 Tex. 123; Willis v. Matthews, 46 Tex. 482; Wooldridge v. Hancock, 70 Tex. 21, 6 S. W. 818. In Wooters v. Hale, supra, it is said: “A parol gift of land will be sustained and enforced when clearly proved, and when possession has been taken and valuable improvements made on the faith of it.”

But appellant argues that the possession of the donee or purchaser must be exclusive in order to maintain his title under a verbal sale and the erection in good faith of permanent and valuable improvements, and contends in effect that no such exclusive possession was shown in this case, for the reason that Kirby, by the terms of the verbal contract, retained the right to take the timber off of the land conveyed, and that he thus retained possession for this purpose. It was agreed, as a part of the consideration for the purchase and sale, that Payne should not claim the timber on the land, and the evidence shows that this part of the contract was performed by Payne because the timber was taken by the vendee of the common source without protest on his part. We think that, in permitting the appellant to take the timber as he did, appellee did not yield possession to it of the land, the subject of the contract between Kirby and Payne, but rather that when appellant entered upon the land for the purpose of taking the timber, its possession was subordinate to that of appellee (Babcock v. Lewis, 52 Tex. Civ. App. 10, 113 S. W. 584), and this did not affect appellee’s title to the land acquired under the contract of sale and the making of valuable and permanent improvements thereon. The assignment is overruled.

The second, third, fourth, and fifth assignments are predicated upon the action of the court in refusing to sustain appellant’s special exceptions to defendants’ answer. We have carefully examined the answer in connection with the special exceptions urged against it, and have concluded that the court did not err in the action complained of.

After the plaintiff, appellant here, had made its announcement of ready for trial, the defendants asked for and obtained leave to file, and did file, their second amended original answer. Appellant then moved the court to strike out the amended answer on the ground that it raised new and additional issues which were not tendered in the former answer, and which appellant did not anticipate would be raised, and that it was not prepared to meet the same. The motion being refused, appellant then filed its motion for a continuance, setting up as grounds therefor that the prior answer raised only the issue of express authority of John H. Kirby to enter into the agreement with Payne, but the amendment then filed set up additional issues of which appellant had no notice, and which it did not anticipate would be raised, and which it was not prepared to meet. The refusal of the court to strike out the answer and to grant the motion for a continuance is made the basis of appellant’s sixth assignment of error.

The first amended original answer alleged that John H. Kirby had express authority from the Texas & Louisiana Land & Lumber Company to execute and enter into the agreement with Payne. The only additional allegations in the second amended answer on this issue were, in effect, that Kirby had the implied and apparent authority to make the agreement, and that the appellee Payne reasonably believed that Kirby did possess such authority, and acted upon such belief in making the agreement, and, further, that the Texas & Louisiana Land & Lumber Company had held out Mr. Kirby as possessing such authority, and had ratified and approved the agreement which he made. We think the action of the court here complained of, if erroneous, was not such an error as to require a reversal. It was alleged that John H. Kirby had express authority to execute the agreement in question, and this allegation was proved by Kirby himself. This being true, it was immaterial what his implied and apparent authority was, or whether Payne believed that Kirby possessed such authority and acted upon that belief, or whether Kirby’s principal held him out as possessing such authority and had ratified and approved the agreement. The assignment is overruled.

The seventh assignment of error complains of the action of the court in admitting certain portions of the testimony'of John H. Kirby, over its objections. The testimony objected to was as follows: “I had full authority from the Texas & Louisiana Land & Lumber Company to make any agreement with any persons with respect to any of their titles which in my business or legal judgment was best for the company’s interest.” And again: “The duties of the position of the general manager were such as the title signifies, and as are usually exercised by the manager of a corporation. I was the only representative in Texas, and had full control of all of its properties, business, contracts, operations, and all that sort of thing in this state.” And again: “I represented the interest of the company in Texas, from the time of its organization up to the time of its dissolution, as completely as though I had been the sole officer of the corporation. I always reported my actions to the board, but I cannot recall a single instance when that action did not meet with their approval.” The proposition under this assignment is as follows: “The mere conclusion of an employé of a corporation as to the extent of his authority to convey land is not competent nor admissible evidence thereof, over objection that there is shown no record or recital of corporate action upon which to base such conclusion.” It is not true that the authority of an agent of a corporation cannot be shown except by a record or recital of corporate action, but, as said by our Supreme Court in Fitzhugh v. Land Company, supra, the authority may be conferred by a vote of the directors not entered of record, or by a course of dealing in which the acts of the alleged agent were known and recognized by the party sought to be charged, as said by this court in Tyler, etc., Loan Ass’n v. Forse, supra. None of the testimony objected to was the conclusion of the witness, except the statement that the duties of the general manager were such as the title signifies, and as are usually exercised by the manager of a. corporation. The other testimony objected to were statements of fact, and, together with other like statements of .the witness, were sufficient to authorize the finding that the witness as agent of the lumber company was authorized to execute the agreement he made with appellee. It does not appear to us that his statement as to the authority of a general manager, as such, although the conclusion of the witness, could have any greater, or as great, weight with the jury in determining the extent of his authority as his positive statements, which were not conclusions, that such authority existed in him; and therefore the admission of that part of his testimony was harmless.

The eighth and last assignment complains that the court erred in overruling appellant’s motion for a new trial. Sixty-three grounds were urged in the motion. That this assignment is too general to authorize our consideration of it is too well settled to require citation of authority.

We find no reversible error in the record and the judgment of the court below is affirmed.

Affirmed.


source: Caselaw Access Project

author: DUNKLIN, J.

license: Public Domain

text:
    CARVER et al. v. POWER STATE BANK.
    (Court of Civil Appeals of Texas. Ft. Worth.
    Jan. 31, 1914.
    Rehearing Denied March 7, 1914.)
    1. Evidence (§ 461) — Relevancy—-Reasonable Value.
    Where there was a dispute as to whether the contract price for • pasturage was for the contract term of more than a year or at that rate per annum, evidence as to the reasonable value of the pasturage for the contract term was admissible.
    [Ed. Note. — For other . cases, see Evidence, Cent. Dig. §§ 2129-2133; Dec. Dig. § 461.]
    2. Trial (§ 265) — Instructions—Limitation of Evidence.
    Defendants could not complain on appeal of the court’s failure to limit certain evidence, in the absence of a request by defendants for such an instruction.
    [Ed. Note. — For other cases, see Trial, Cent. Dig. §§ 627-641; Dec. Dig. § 255.]
    3. Appeal and Error (§ 1056) — Rulings on Evidence — Prejudice.
    Where the allegations in the petition in a former suit did not contradict the allegations in the petition in the suit at bar, nor the testimony of a witness for plaintiff, defendants were not prejudiced by the refusal to admit such petition in the former suit as an admission by plaintiff and the witness that the contract was not as alleged in the present suit, and as testified to by such witness.
    [Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 4187-^4193, 4207; Dec. Dig. § 1056.]
    Appeal from District Court, Archer County; P. A. Martin, Judge.
    Action by the Power State Bank against E. B. Carver and others. Judgment for plaintiff, and defendants appeal.
    Affirmed.
    Allen & Allen, Taylor & Humphrey, and Wantland & Parrish, all of Henrietta, for appellants. W. E. Forgy, of Archer, and Montgomery & Britain, of Wichita Falls, for ap-pellee.

      For other cases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep’r Indexes

   DUNKLIN, J.

Huggins, Boddy & Neville employed E. B. Carver to pasture 1,499 head of cattle from the 1st day of October, 1909, until April 1, 1910. The cattle were purchased from Carver by Huggins, Boddy & Neville at the time the contract for pasturage was entered into, and the cattle were pastured for the period stipulated. Carver transferred his claim for such pasturage to the Power State Bank, and guaranteed the payment of the same. The bank instituted this suit against Huggins, Boddy & Neville, as principal obligors, and against Carver, as guarantor, for the amount claimed to be due for such pasturage, and, from a judgment in favor of the bank, Huggins, Boddy & Neville have appealed.

The principal controverted issue in this case was whether or not, at the time the contract of pasturage was entered into, Huggins, Boddy & Neville agreed to pay for such pasturage at the rate of $2 per head for the full period of such pasturag.e, as alleged in plaintiff’s petition, and as testified to by Carver, or whether the contract was to pay for such pasturage at the rate of $2 per head per annum, as testified to by defendants Huggins and Boddy. With this conflict in the testimony relative to the contract price for pasturage, the court, over appellants’ objections, permitted E. B. Carver and George Abercrombie to testify that the reasonable value of such pasturage for that period was from $2 to $2.50 per head; The market price for such pasturage was a circumstance helpful to the solution of the conflict in the testimony of the witnesses as to the contract, and there was no error in the ruling referred to. Paine v. Argyle Merc. Co., 133 S. W. 895; and Kocher v. Mayberry, 15 Tex. Civ. App. 342, 39 S. W. 604. Of course it would have been proper for the court to charge the jury that the testimony relative to the market value of pasturage could be looked to for no other purpose except as a circumstance to be considered in determining whether or not the contract price for the pasturage was as testified by Carver, or was as testified by Huggins and Boddy; but, in the absence of a request by appellants so to do, they cannot complain of the failure of the court to give such an instruction.

Prior to the institution of this suit the bank instituted another suit in the county court which was afterwards dismissed, and error has been assigned to the refusal of the court to admit in evidence, when offered by appellants, the plaintiff’s petition in the former suit. The purpose of appellants in offering the petition was to show an admission by the bank and by Carver that the contract for pasturage was not as alleged in this suit and as testified to by Carver. While it is true that in that petition only $890 was claimed as damages, yet it is also true that only a portion of the account for pasturage had then been assigned to the bank by Carver, and was then being asserted as a cause of action. It was expressly alleged in that petition that the contract price for pasturing the cattle for the same period of time which is alleged in the present suit was $2 per head. It thus appears that the allegations in the former suit did not contradict the allegations contained in the petition in this suit, nor the testimony of Carver that the contract price for such pasturage was at the rate of $2 per head. Hence, if it could be said that the court erred in refusing to admit in evidence the petition in the former suit, it clearly appears that the error was harmless.

By another assignment it is insisted that the verdict of the jury is contrary to the weight of the testimony, in that Carver’s testimony that the contract price for pasturage was $2 per head, was flatly contradicted by the testimony of appellants. As the jury were the exclusive judges of the credibility of the witnesses, this assignment must be overruled.

The judgment is affirmed.


author: FLY, C. J.

text:
    BOYNTON v. BROWN et al.

    (Court of Civil Appeals of Texas. San Antonio.
    Feb. 18, 1914.
    Rehearing Denied March 4, 1914.)
    1. Mandamus ■(§§ 145, 146) — 'Calling Election — Parties.
    Under the Enabling Act (Acts 33d Leg. c. 147), giving a prescribed number of voters the right to demand an election by petition, one or more of the petitioners could apply for, and, under proper circumstances, obtain, a writ of mandamus compelling the calling of the election, which suit could be prosecuted in the name of the state or of the relator.
    [Ed. Note. — Nor other cases, see Mandamus, Cent. Dig. §§ 286, 287; Dec. Dig. §§ 145, 146.]
    2. Mandamus (§ 74) — (¿bounds—Ministerial Act.
    Mandamus lies to compel the performance of official duties which are imperative and unaccompanied with an element of discretion, and courts will extend relief to compel the holding of a municipal election where the duty is clearly obligatory and has been disregarded.
    [Ed. Note. — Nor other cases, see Mandamus, Cent. Dig. §§ 150-157; Dee. Dig. § 74.)
    3. Mandamus (§ 70) — Judicial Act — Municipal Election.
    Under the Enabling Act (Acts 33d Leg. c. 147), which provides that the governing body of any city of more than 5,000 inhabitants, upon petition of 10 per cent, of the qualified voters, shall provide by ordinance for the submission of the question whether a commission shall be chosen to frame a new charter, but which does not expressly provide for the determination of the number or the qualification of the petitioners, it was for the council to determine, such matters in the exercise of its own judgment, and, where its action was based upon reason and fairness, and not upon fraud, caprice, or unfairness, mandamus will not lie to review such determination.
    [Ed. Note. — For other cases, see Mandamus, Cent. Dig. § 132; Dec. Dig. § 70.]
    4. Mandamus (§ 70) — “Ministerial Act” and “Judicial Act” Distinguished.
    The distinction between “ministerial” and “judicial” acts is that, where the law prescribes the duty to be performed with such certainty as to leave nothing to the exercise of judgment or discretion, the act is a “ministerial act,” but, where the act involves the exercise of discretion or judgment in determining whether the duty exists, it is a “judicial act.”
    [Ed. Note. — For other cases, see Mandamus, Cent. Dig. § 132; Dec. Dig. § 70.

    For other definitions, see Words and Phrases, vol. 5, pp. 4523-4525; vol. 8, p. 7722; vol. 4, pp. 3848-3853; vol.. 8, p. 7697.]
    5. Mandamus (§ 154) — Election—Sufficiency op Petition.
    Under the Enabling Act (Acts -33d Leg. c. 147), requiring the governing authority of any city, upon petition of 10 per cent, of the qualified voters, to provide for an election on the question whether a commission shall be chosen to frame a new charter, leaving the determination of the number and qualification of the petitioners to the discretion of the city council, a petition for mandamus to compel an election failing to allege that the action of the council was arbitrary or fraudulent. stated no cause of action; the allegation that the council’s act was without any legal excuse and without giving any reason for their action being a mere conclusion and totally insufficient as an allegation of fraud.
    [Ed. Note. — For other eases, see Mandamus, Cent. Dig. §§ 296-316; Dec. Dig. § 154.]
    6. Mandamus (§ 6%) — 'Grounds—Adequacy —Legal Remedy.
    While mandamus issues only when the aggrieved party has no other adequate remedy, it is not true that when he has no other remedy he may resort to the writ of mandamus.
    [Ed. Note. — For other cases, see Mandamus, Dec. Dig. § 6%.]
    7. Elections (§ 34) — Petition for Election — Refusal.
    Under the Enabling Act (Acts 33d Leg. c. 147), providing that the governing authority of cities of more than 5,000 inhabitants upon petition of 10 per cent, of the qualified voters shall provide by ordinance for an election on the question of a commission to frame a new charter, the refusal of the mayor and council to call such election was not void because evidenced by resolution instead of an ordinance, since where the election was not called the form of refusing the petition was immaterial.
    [Ed. Note. — For other cases, see Elections, Cent. Dig. § 24; Dec. Dig. § 34.]
    Appeal from District Court, Bexar County; S. G. Tayloe, Judge.
    Mandamus by Alexander Boynton against Clinton G. Brown, Mayor, and Jack W. Neal and others, Aldermen of the City of San Antonio, to compel them to order an election. Decree for defendants, and plaintiff appeals.
    Affirmed.
    See also, 163 S. W. 599, 164 S. W. 897.
    E. P. Lipscomb, of San Antonio, for appellant. Geo. R. Gillette and R. J. McMillan, both of San Antonio, for appellees.

      For other oases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep’r Indexes

       Writ of error denied by Supreme Court.

   FLY, C. J.

This is an application by appellant for a mandamus to compel Clinton G. Brown, mayor, and Jack W. Neal, George W. Saunders, F. A. Chapa, John W. Warren, U. H. Rische, Robert F. Uhr, W. L. Hoefgen, J. R. Baldwin, Albert Steves, Sr., J. R. Lambert, C. T. Fincham, and Leo M. J. Diel-mann, aldermen of the city of San Antonio, to order an election submitting the question, “Shall a commission be chosen to frame a new charter,” as required by an act of the Thirty-Third Legislature at its regular session in March, 1913. The petition copies the provision of the law of 1913 (Acts 33d Leg. c. 147), known as the “Enabling Act,” which provides (section 2) that “the legislative or. governing authority of any incorporated city, having more than 5,000 inhabitants, may by a two-thirds vote of its members, or upon petition of ten per cent, of the qualified voters of said city, shall provide by ordinance for the submission of the question, ‘Shall a commission be chosen to frame a new charter?’ ” And it was alleged that the city of San Antonio is incorporated and has more than 6,000 inhabitants and that there were 12,222 qualified -voters in May, 1913, when the last regular city election was held in San Antonio; that in November, 1913, appellant with many others “aggregating more than 1,600 voters and more than ten (10) per cent, of the qualified voters of said city'signed and caused to be filed with the said city, and its council, which, under the charter of said city, is made the legislative' or governing authority of said city, a petition in conformity with and in compliance with all the provisions of said law, petitioning that said city council provide by ordinance for the submission of the question, ‘Shall a commission be chosen to frame a new charter?’ which petition has been ignored and refused by said city council, and said city council has refused to provide by ordinance or otherwise for the submission of said question, and has refused to submit the same, or make any provision therefor, as required by law; that respondents, without any legal excuse, and without giving any reasons for their action, have refused and failed and continue to refuse and fail to submit said question, or to make any provision whatever therefor.” It was also alleged: That the city council were “seeking to thwart said purpose and have constituted and appointed themselves a committee, to prepare certain amendments to the old charter of said city, the purport and character of said amendments being unknown to relator, and being kept a secret by defendants and no official publication thereof being made, all for the purpose of evading and making null the said law and violating the same in letter and spirit, and using the machinery of said city for their own selfish designs and political purposes; and, in pursuance thereof, have stated that they will call an election to be held on or about the 24th day of February, 1914, in the city of San Antonio, for the purpose of voting on said proposed amendments surreptitiously and illegally prepared by them. That if such amendments, so surreptitiously and illegally prepared, are submitted, the effect thereof will be to confuse and make uncertain the charter of said city and operations of the government thereof, to the great and irreparable damage and injury of relator and said taxpayers and qualified voters thereof. That he and they have no adequate remedy at law, and irreparable damage and injury will result to him and them, unless the respondents herein are at once ordered by writ of mandamus to comply with the requirements of said law, as aforesaid.” A writ of mandamus was prayed for. Ap-pellees answered by general and special exceptions and answered fully traversing the facts that were pleaded by appellant. It was alleged that the petition presented to the city council was not the petition of 10 per cent, of the qualified voters, that it contained the names of many parties who were not qualified voters of San Antonio, that it had names signed to it that were not signed by the parties named, that in at least 60 instances the same parties signed the petition many times, that in considering the petition the council had to determine many issues of fact as to residence of the signers and their qualification to vote, to determine the number of qualified voters in the said city at that time, and that in the exercise of their judgment and discretion they ascertained and determined the petition did not constitute one made by 10 per cent, of the qualified voters. It was further alleged that on January 15, 1914, an ordinance had been 'passed submitting amendments to the charter for the adoption or rejection of the people at an election to be held on February 24, 1914. A number of special exceptions to the answer were filed.

The exceptions filed by both parties were overruled, and the court, upon consideration of the petition and answer, “concluded that the questions of what number of qualified voters there were in the city of San Antonio on the date of the filing of the petition with the city council, * * * and also the question of whether or not the petition so presented to the city council was the petition of 10 per cent, of the qualified voters residing within the city limits of the city of San Antonio, were questions which were judicial in their nature and were not merely ministerial acts; and respondents’ answer having disclosed that said petition had been considered and the facts inquired into, and that the city council had deemed the same insufficient and had refused to grant the prayer contained in said petition; and there being, in the opinion of the court, no allegation in relator’s petition raising the issue that such action of the council was arbitrary or that their action was attended with any unfairness in the investigation of the facts, or that there was any abuse on their part in the exercise of the powers conferred upon them by law — -the court was of opinion that it had no power to enter upon an original inquiry as to whether or not said petition did in fact contain 10 per cent, of the qualified voters within the city limits of the city of San Antonio at the time the same was filed with the city council and thereupon dismissed the petition for mandamus.” A decree was accordingly so entered.

■ This cause was filed in this court on February 2, 1914, and on February 4th, appellant applied to this court for a temporary writ to restrain the city council from holding the election on February 24th, which was refused in a written opinion on the ground that this court did not have the jurisdiction to grant an injunction in this case. After-wards, a temporary injunction was applied for to the district court and denied, and an appeal from the order taken to this court. The matter of injunction is so indissolubly connected with and dependent upon our decision in the mandamus ease that both cases were submitted and will be considered together, as well as another application for injunction filed in this court to prevent the district court from taking any action in regard to the injunction which had been previously denied and had been appealed to this court.

The act hereinbefore referred to gives the requisite number of voters the right to demand an election by petition, and it is settled in this state that one or more of the petitioners can apply for and, under proper circumstances, obtain a writ, of mandamus, and the suit can be prosecuted in the name of the state or that of the relator. Kimberly v. Morris, 87 Tex. 637, 31 S. W. 808; Sweeney v. Webb, 33 Tex. Civ. App. 324, 76 S. W. 766.

The rule is thus stated in High’s Extr. Rem. § 401: “In conformity with the fundamental principle that mandamus lies to compel the performance of official duties which are imperative in their nature and unaccompanied with any element of discretion, the courts will extend relief to compel the holding of a municipal election when the duty is clearly obligatory and has been disregarded by the officers intrusted by law with its performance.” Under the operation of this rule, whenever the law directs an officer or officers to order an election when a certain number of qualified voters have joined in a petition for the same, it is made the duty of the officers to ascertain whether the requisite number of voters have joined in the petition, and whether they are qualified, and mandamus will not lie to control them in the exercise of that duty; but the officers upon whom is devolved the duty of calling the election will be allowed to exercise their own judgment. Their action must be based upon reason and fairness, however, and not be impelled by fraud, caprice or unfairness. High, Extr. Rem. § 58; Merrill on Mandamus, § 112; State v. Commissioners, 8 Nev. 309; State v. County Com’rs, 10 Neb. 32, 4 N. W. 373; United States v. Edmunds, 72 U. S. (5 Wall.) 563, 18 L. Ed. 692; Cullem v. Latimer, 4 Tex. 329; Arberry v. Beaver, 6 Tex. 457, 55 Am. Dec. 791; Bledsoe v. Railway, 40 Tex. 537; Sansom v. Mercer, 68 Tex. 488, 5 S. W. 62, 2 Am. St. Rep. 505; De Poyster v. Baker, 89 Tex. 155, 34 S. W. 106; Shook v. Journeay, 149 S. W. 406.

The cited case of Sansom v. Mercer is a leading one on the subject of issuing writs of mandamus to require officers to call elections. That cause was decided under article 575, Sayles’ Statutes, which provided that, whenever 50 qualified voters of any territory within the limits of any incorporated town should sign and present a petition to the mayor asking that such territory should be segregated from the town, it should be the duty of the mayor to order an election on the request of the petitioners. Eighty-one persons filed a petition with the mayor of Alvarado, Tex., praying that certain territory be declared no longer a part of the town, and he refused to call the election.. A writ of mandamus was sought to compel him to call the election. It was alleged in the petition that the 81 petitioners were qualified voters and that the mayor, “without any legal excuse and without giving any reasons for his action, refused and failed to order said election.” The court held: “It is well settled that, if the duty an officer is called upon to perform requires the exercise of an act of judgment on his part, Ms decision is not subject to be revised by a proceeding for a writ of mandamus. * * * And it is apparent that, in a proceeding to procure an order for an election under the statute before cited, the mayor is required to determine two facts in order- to justify him in making the order for the election: First, that there is a surplus of territory over the limit prescribed by the statute; and, second, that at least 50 qualified voters of that territory have signed the petition. If there be any controversy as to the existence of these facts, his function is discretionary, and he cannot be compelled to order the election.” The mandamus was granted in that case because there was no answer filed, but the facts alleged in the petition were admitted to be true by the filing of a demurrer. That case has often been approved in and out of this state.

In the case of Commissioner v. Smith, 5 Tex. 479, it is said that the “distinction between ministerial, and judicial and other official acts, seems to be that where the law prescribes and defines the duty to be performed, with such precision and certainty as to leave nothing to the exercise of discretion, or judgment, the act is ministerial; but, where the act to be done involves the exercise of discretion or judgment in determining whether the duty exists, it is not to be deemed merely ministerial.” In tMs case the petition was presented under the statute of 1913, herein cited, in which the governing body of a city of more than 5,000 inhabitants is required to order an election, when a petition signed by 10 per cent, of the qualified voters is presented. Under that law, as under the article cited in Sansom v. Mercer, the city council was to determine whether the signers to the petition were qualified voters, and in addition whether they constituted 10 per cent, of the qualified voters of the city of San Antonio, in order to justify the calling of an election. Some one had to determine these matters, for no election upon petition could legally be called except on a petition of a certain number of the qualified voters at the time it was presented, and no one else had that authority except the city council. To hold that the city council had no authority to ascertain those facts would be to hold that the council was compelled to call an election, although the petition was not signed by qualified voters, or an insufficient number of them, and put the people of San Antonio at the mercy of people in no way interested in the welfare of the city. The law creates an uncertainty wlien it speaks of “qualified voters,” and it leaves the time indefinite as to when the enumeration of the voters should take place, and no authority had the power to decide those matters at the time when the petition was presented, if the council- did not.

There was no allegation in the petition that the city council acted arbitrarily, unreasonably, capriciously, or fraudulently. The allegation that the action of appellees was “without any legal excuse and without giving any reasons for their action” was totally insufficient. It was merely a conclusion of the pleader. City of Houston v. Smith, 12 Tex. Civ. App. 120, 34 S. W. 194. Appellees were not required at the time that the petition was rejected to give reasons for their action. The reasons were fully given in the answer to the petition. The court might well have sustained a demurrer to the petition, because its allegations did not show any fraud or unfairness, and the law vested discretion in appellees as herein indicated, but he overruled the exceptions, and the cause was submitted on the petition and answer. Appellant did not ask to introduce any evidence, and the court properly refused the mandamus.

It may be that appellant has no adequate legal remedy, but that would be no argument in a case where it is sought to compel a judicial rather than a ministerial act. •“It is-well settled that, while mandamus issues only when the aggrieved party has no other adequate remedy, the converse of the proposition is not true, that when he has no other remedy he may resort to the writ of mandamus.” Ewing v. Cohen, 63 Tex. 482.

In the case of Shook v. Journeay, 149 S. W. 406, the principles applying to mandamus are thoroughly and ably discussed by Associate Justice Moursund, for this court, and it is clearly shown that courts or officers when given discretion to act cannot be compelled to act contrary to their views on discretionary matters, even though the action taken by them has been wrong. The decision in that case was reversed by the Supreme Court, not on the ground that the general principles stated therein were not correct, but on the ground that it was the imperative duty of the clerk of the county court to issue letters testamentary to an executor, losing sight, it would seem, of the discretion and authority vested in the county court in regard to letters, testamentary, by articles 3293 and 3295, Rev. Stats. In the first article mentioned the county court is required, .before granting letters testamentary, to ascertain six things; the last being “that the person named as executor is not disqualified by law.” The question as to the right to mandamus the clerk to issue the letters after the county court had so ordered was not before this court, but the question was whether the county judge could be compelled to appoint a person deemed unfit by him as executor, and, because the law vested in him the power and authority to pass upon the qualifications of the person named in the will as executor, this court held that it was a matter of discretion with him and a mandamus would not lie to compel him to appoint a person not deemed by him to be qualified. We have thought it not inappropriate to dis-eussi the case of Shook v. Journeay, because the opinion of the Supreme Court leads to the view that this court held that, although' no discretion was vested in the county court in regard to the appointment of executors, mandamus would not lie, when the law clearly clothes the county judge with discretion to reject an executor and the clerk has no authority to issue letters until ordered by the county court. As in that case, so in this, we hold that, where discretionary powers are given by law to officers, a mandamus will not lie to compel different action from that taken by them.

It is contended that the action of ap-pellees in refusing to call the election was null and void because they acted through a resolution instead of an ordinance. We know of no law requiring action in refusing to call the election to be evidenced by ordinance; but, if the “Enabling Act” should require it, appellees have not refused, as alleged by appellant, to call the election, and there has been no action by appellees on the petition, and appellant’s action should have been to compel them to act on the petition. No form, however, is necessary in refusing the petition provided for in the act, but it is 'only in case of the election being called that the requisite forms are prescribed. The reason is apparent, because it is absolutely necessary that formal matters should be attended to if the election is called; but it is a matter of no consequence, if the election is not called.

Por the reasons given, the judgment of the district court is affirmed.


text:
    BOYNTON v. BROWN, Mayor, et al.

    (Court of Civil Appeals of Texas. San Antonio.
    Feb. 18, 1914.
    Rehearing Denied March 4, 1914.)
    1. Appeal and Error (§§ 439, 440) — Perfection op Appeai> — Power op Trial Court.
    When an appeal is perfected during a term of the trial court, that court, during its term, can make orders in the case and alter, revise, or revoke the judgment from which the appeal was taken.
    íEd. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 2197-2201; Dec. Dig. §§ 439, 440.]
    2. Appeal and Error (§ 440) — Perfection op Appeal — Power op Lower Court.
    After appeal from an interlocutory order on an application for a temporary writ of injunction, the trial judge cannot change his order or exercise any jurisdiction whatever over it.
    [Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 2198-2201; Dec. Dig. § 440.]
    Appeal from District Court, Bexar County; S. G. Tayloe, Judge.
    Mandamus by Alexander Boynton against Clinton G. Brown, Mayor, and Jack W. Neal and others, Aldermen of the City of San Antonio, to compel them to order an election, with application by Boynton for an injunction from this court to restrain the District Judge from taking further action in regard to an injunction which he had previously denied, and which had been appealed to this court.
    Application denied.
    See, also, 163 S. W.-599; 164 S. W. 893.
    E. P. Lipscomb, of San Antonio, for appellant. Geo. R. Gillette and R. J. McMillan, both of San Antonio, for appellees.

      For other oases see same topic and section NUMBER in Deo. Dig. & Am. Dig. Key-No. Series & Rep’r Indexes

       writ of error denied by Supreme Court.

   FLY, C. J.

This is an application for an injunction from this court to restrain the district judge from taking further action in cause 5256, pending in this court (164 S. W. 897), which is an appeal from the order of the trial judge refusing a writ of injunction restraining appellees from proceeding with an election on February 24th.

It is the well-established rule that, when appeals are perfected during a term of the trial court, the latter court can during its term make orders in the case, and alter, revise, or revoke the judgment from which the appeal was taken. Blum v. Wettermark, 58 Tex. 125; Churchill v. Martin, 65 Tex. 367; Blackburn v. Knight, 81 Tex. 331, 16 S. W. 1075. In the case of Churchill v. Martin it was said that after the approval of an appeal bond “the district court still has, during the term, jurisdiction to modify or to set aside the judgment appealed from, but not to enforce such judgment.”

In all the cases cited, as well as the case of Ellis v. Harrison, 24 Tex. Civ. App. 13, 56 S. W. 592, 57 S. W. 984, relied on by appellees, the appeals were from judgments finally disposing of the subject-matter of the suits, and no case has been cited, or found by this court, that holds that, when an appeal is taken from an interlocutory order on an application for a temporary writ of injunction, the trial judge can change his order, and the fact that the writ may be granted or refused in term time or vacation indicates that it was not the intention of the Legislature that the trial court should exercise any jurisdiction whatever over such order after an appeal has been perfected. The very fact that, if the order is made in vacation, no action could 'be had by the trial court after the appeal was perfected, would indicate that no such action could ever be had. To permit such practice would create grave complications and perhaps, at times, defeat the object in view in permitting appeals from such interlocutory orders immediately after their rendition. It has been intimated that no action should be had by the appellate court during the term of the lower court at which it was tried, and, if that be true, and appeals from orders on applications for temporary injunctions must be held until the end of the term, in most instances the efficacy of the appeals would be destroyed.

We do not deem it necessary to issue an order to the district judge to restrain him from any further action in regard to his order refusing the temporary injunction, which is final so far as he is concerned, or requiring him to set aside any order heretofore made by him after the appeal was perfected, because this court is confident that he will at once proceed as is indicated herein. While we have sustained the order of the district judge in refusing the injunction, which was his final action, we have deemed it proper to express the views of this court for the future government of trial courts. This court will, under all circumstances, protect its jurisdiction from interference by any trial court, but it is not, as before stated, deemed necessary to grant an injunction to protect its jurisdiction in this instance.


text:
    BOYNTON v. BROWN, Mayor, et al. †
    (Court of Civil Appeals of Texas. San Antonio.
    Feb. 18, 1914.)
    Appeal from District Court, Bexar County.
    Action by Alexander Boynton against Clinton G. Brown, Mayor, and others. From an adverse order, plaintiff appeals.
    Affirmed.
    See, also, 163 S. W. 599; 164 S. W. 893, 897.
    E. P. Lipscomb, of San Antonio, for appellant. Geo. R. Gillette and R. J. McMillan, both of San Antonio, for appellees.
   FLY, C. J.

This is an appeal from an interlocutory order of the district court refusing an injunction to restrain the mayor and city council from holding an election to vote on amendments to the charter of the city of San Antonio, on February 24, 1914. The writ of injunction is sought in aid of mandamus proceedings to compel the appellees herein to call an election to vote on the question of having a commission prepare a city charter. It must stand or fall with those proceedings, and, this court having this day affirmed the judgment of the district court in refusing the mandamus for the reasons therein given, the judgment in this case is affirmed.


author: LEVY, J.

text:
    HUGHES v. FOUR STATES LIFE INS. CO.
    (Court of Civil Appeals of Texas. Texarkana.
    Feb. 9, 1914.
    Rehearing Denied Feb. 19, 1914.)
    1. Appeal and Error (§ 1050) — Review-Reception op Evidence — Prejudice.
    Where, in an action on notes given for certain of plaintiffs corporate stock, plaintiff’s managing agent testified that B., who sold the stock to defendant, was plaintiff’s authorized agent to sell the same, and plaintiff was seeking to recover on notes taken by B. in payment for stock, the fact that the court permitted B. to testify that he had authority to sell the stock, and take notes or cash in payment thereof, under an objection that his written contract of agency was the best evidence, was not reversible error.
    [Ed. Note. — Por other cases, see Appeal and Error, Cent. Dig. §§ 1068, 1069, 4153-4157, 4166; Dec. Dig. § 1050.]
    2. Insurance (§ 16) — Foreign Corporations — “Doing Business” in State — Sale op Stock.
    Sale, in Texas, of stock of a foreign insurance company, and taking notes for the price, does not constitute transacting or doing business in Texas, within the statutes regulating the transaction of business by foreign corporations in Texas.
    [Ed. Note. — For other cases, see Insurance, Cent. Dig. § 17; Dec. Dig. § 16.

    For other definitions, see Words and Phrases, vol. 3, pp. 2155-2160; vol. 8, pp. 7640, 7641.]
    3. Insurance (§ 22) — Agents—Regulation —Sale op Stock.
    Rev. St. 1911, arts. 4960, 4961, making it unlawful for any person to act as agent for an insurance company in soliciting or receiving applications, etc., without having procured a certificate of authority from the commissioner of banking and insurance, has no application to an agent of a foreign insurance company selling its stock in Texas.
    [Ed. Note. — For other cases, see Insurance, Cent. Dig. § 26; Dec. Dig. § 22.]
    4. Bills and Notes (§ 537) — Peremptory Instruction — Questions op Pact.
    Where, in an action on notes given for the price of stock of a foreign insurance company, defendant expressly admitted that he gave the notes sued on for the purchase of the stock, and there was no issue of fact presented for a jury, the court properly directed a verdict for plaintiff.
    [Ed. Note. — For other cases, see Bills and Notes, Cent. Dig. §§ 1862-1893; Dee. Dig. § 537.]
    5. Pleading (§ 264) — Amendment—Effect.
    Where, in an action on notes given for stock in plaintiff insurance company, plaintiff filed a supplemental petition before defendant’s amended original answer, and replied to certain allegations in the original answer concerning the written contract, after which defendant filed an amended original answer which contained nothing but a general denial, and made no averments in reference to or applicable to the note sued on in the petition on which the case was tried, averments of the original answer and supplemental petition concerning the contract of subscription passed out of the record, so that the pleadings presented no issue on such question.
    [Ed. Note. — For other eases, see Pleading, Cent. Dig. §§ 803-805; Dec. Dig. § 264.]
    Appeal from Franklin County Court; J. J. Walker, Judge.
    Action by the Four States Life Insurance Company against W. W. Hughes. Judgment for plaintiff, and defendant appeals.
    Affirmed.
    This is an action for debt brought by the appellee against the appellant. The petition declared on two promissory notes executed by appellant, the first for $96, payable to the order of W. B. Byers, and for a valuable consideration transferred by Byers to plaintiff, and the second for $204, payable to the order of the plaintiff. The appellant made answer to the petition, and appellee filed a supplemental petition, answering the allegations of the defendant’s answer. After the filing of the supplemental petition, the appellant amended his original answer, which contained a general denial of the allegations in the original petition and aver-ments as to the subscription contract set up in the supplemental petition replying to the original answer. It is unnecessary to make further statement of the defendant’s aver-ments in respect to the subscription contract, as appellee did not sue or obtain judgment on a subscription contract. After the introduction of all the evidence, the court peremptorily instructed the jury to return a verdict for appellee for the amount of the two notes sued on.
    The evidence establishes that the appellee is a life insurance corporation chartered under the laws of the state of Arkansas in 1910, and granted a permit to do business in that state in February, 1911. A permit to do business in the state of Texas was obtained by and was granted to the company September 27, 1912. On April 25, 1911, W. B. Byers, the authorized agent of the appellee, sold appellant, as he admits, in Franklin county, Tex., 24 shares of the authorized capital stock and subscribed surplus of the insurance corporation for the agreed sum of $300. It was mutually agreed that the $300 was to be evidenced by two promissory notes, payable in six and eight months, respectively, after date, and that the certificates of stock were to be issued and delivered by the company when the notes were fully paid up. The two notes sued on were the two notes signed and delivered by appellant. These facts of mutual assent and agreement are admitted by appellant in his testimony.
    G. E. Cowan and H. W. Hunt, both of Mt. Vernon, for appellant. Wilkinson & Wilkinson, of Mt. Vernon, for appellee.

      For other oases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep’r Indexes

   LEVY, J.

(after stating the facts as above). The first assignment predicates error upon permitting the witness Byers to testify that he had authority from the ap-pellee company to sell stock, and take notes or cash in payment thereof. The objection to the evidence is that the written contract of agency given the witness, which contained the precise authority orally stated, was the best evidence. There is no question made in the record of any want of authority in Byers, as the agent of appellee, to take notes for the payment of stock. The manager of the agency department of appellee testified that Byers was the duly authorized agent of ap-pellee to sell stock. And the appellee stands on the notes taken by Byers as being within his authority as agent to take in payment of stock. The assignment, therefore, does not present error sufficient for reversal of the judgment.

The sixth assignment of error is to the point that appellee, a foreign corporation, without any permit to do business in Texas at the time of the execution of the notes, was incapacitated to sue. The appellee was organized for the purpose of writing insurance on the lives of individuals. At the time of the instant suit it had a permit to do business in the state of Texas, but did not at the time of execution of the notes. The notes sued on were given in payment for shares of capital stock of the corporation which were to be issued when the notes were paid. It is not believed that the selling of the stock for which the notes in suit were given was transacting or doing business in the sense of the statute. Bank v. Leeper, 121 Mo. App. 688, 97 S. W. 636.

The seventh assignment claims that the notes sued on'are void, because the agent of appellee selling the stock to appellant did not at the time of the sale have a certificate of authority from the commissioner of banking and insurance of this state. It is quite clear that articles 4960 and 4961, R. S. 1911, have no application to the point made by the assignment.

The second, fourth, and ninth assignments are here considered together as practically presenting the one question of error on the part of the court in peremptorily instructing a verdict in favor of appellee. Under the pleadings and evidence there was not presented an issue of fact for decision by the jury, and we do not think-the court erred. The appellee sued to recover on two notes executed and delivered by appellant. Appellant expressly admitted and did not contest the fact that he signed and delivered the two notes sued on, for the purchase price of 24 shares of stock in the appeliee company, and agreed that the certificates of shares were to be issued to him by the company when the notes were paid. And the pleading of appellant in reference to the notes was only a general denial.

Appellant’s argument, though, in challenging the peremptory instruction seems to be predicated upon the assumption that there was issue made by pleadings and evidence over the validity of a certain written contract of subscription for stock in the company. The pleadings, however, as shown in the record, do not warrant that construction, or have that effect. The petition, it appears, declared only on two promissory notes executed and» delivered by appellant. The original answer was, it appears, amended, and a first amended original answer was then filed. This amended original answer appears on its face to be an amendment of and in lieu of the original answer. The amended original answer, except as to the general denial, did not make any averments in reference to or applicable to the note sued on, in the petition that the case was tried on. There’ do appear however, in the amended original answer averments of several paragraphs respecting the invalidity of a “subscription contract in writing set up and plead by plaintiff.” By reference to the record it appears that, in a supplemental petition filed before the amended original answer, the appellee replied to certain allegations of the original answer that, as respects such allegations of the original answer, there was a written contract between the parties of subscription to stock. The supplemental petition on its face undertakes only to make answer to the allegations of the original answer of the defendant, and does not undertake to set up matters further than as answer to the matters set up in the original answer of the defendant. By giving force to the amended original answer of defendant, filed after the supplemental petition, as being in lieu, as stated, of the original answer, then such amended original answer operated to eliminate and retire from the case all matters of special answer in the original answer of the defendant not brought forward in the amended answer. And we would be required, in this record, to give the amended answer the construction that it was strictly an amended original answer, designed as such, and not merely a supplemental answer in reply to the plaintiff’s supplemental petition, for the amended original answer declares it was strictly an amendment, and the parties so treated it, and retired the original answer from the case and this record. By retiring the matters plead in the original answer, which the supplemental petition was in answer to, such allegations of the supplemental petition answering the retired matters were in consequence retired and made immaterial in the trial. There was then left, by the amendment, only a general denial so far as pertains to the notes sued on. The office of a supplemental petition, filed strictly as such, as was the one here, is only to answer the defendant’s answer, and does not intend to amend the original petition.

The judgment is affirmed.


author: CONNER, C. J.

text:
    FIRST NAT. BANK OF AUBREY v. CHAPMAN et al.
    (Court of Civil Appeals of Texas. Ft. Worth.
    Jan. 17, 1914.
    Rehearing Denied Feb. 14, 1914.)
    1. Bills and Notes (§ 538) — Actions—INSTRUCTIONS.
    In an action upon a note where the maker set up the fraud of the payee as a defense, and the evidence that plaintiff and his -predecessor in title took with notice of the fraud, was not clear, and only tended to show that a reasonable man would have been put on inquiry by the circumstances surrounding the transfer of the note, the refusal of a requested charge that, if plaintiff in good faith purchased the note without notice that it had been procured by fraud, or misrepresentations, judgment should be for it is erroneous.
    [Ed. Note. — For other cases, see Bills and Notes, Cent. Dig. §§ 1895-1898, 1900-1910; Dec. Dig. § 538.]
    2. Bills and Notes (§ 339) — .Actions—Defenses.
    The ordinary rules of constructive notice which apply to the purchase of property are not applicable to negotiable instruments, and, if the buyer has acted in good faith and paid a valuable consideration, his title cannot be impugned ; the acquisition of the note under circumstances tending to put a reasonable man on inquiry merely being evidence tending to show bad faith.
    [Ed. Note. — For other cases, see Bills and Notes, Cent. Dig. §§ 821-823; Dec. Dig. § 339.]
    3. Bills and Notes (§ 505) — Actions—Evi- • DENCE.
    In a suit on a note where the maker set up the payee’s fraud, evidence that the payee agreed to keep -the note and not to transfer it is admissible on the issue of fraud.
    [Ed. Note. — For other cases, see Bills and Notes, Cent. Dig. §§ 1717, 1718; Dec. Dig. § 505.] '
    4. Appeal and Error (§ 1051) — Review— HARMLESS ERROR.
    Where defendant set up the payee’s fraud and misrepresentations in inducing him to take a -vendor’s lien note in payment for an automobile, and to execute the note sued on for the difference, the admission of evidence of a declaration by the maker of the vendor’s lien note that he could not pay the note and that the payee had fleeced him, while erroneous, is harmless, where the evidence abundantly showed insolvency of the maker of the vendor’s lien note.
    [Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 4161-^4170; Dec. Dig. § 1051.:]
    5. Bills and Notes (§ 509) — Actions—Evidence — Admissibility.
    Where the plaintiff bank claimed to have acquired the note in suit in good faith and for a valuable consideration before maturity, evidence that, in reply to inquiry of the maker, who claimed that he had been induced to execute the note by the fraud and misrepresentations of the payee, the cashier stated the day before the note became due that he could not find it is admissible on the question whether the bank acquired the note before maturity.
    [Ed. Note. — For other cases, see Bills and Notes, Cent. Dig. §§ 1740-1745; Dec. Dig. § 509.]
    6. Bills and Notes (§ 509) — Actions—Evidence — Admissibility.
    Where defendant claimed that he had executed the note sued on in reliance upon the fraudulent misrepresentations of the payee, and that plaintiff had not acquired it in good faith, evidence of the payee’s general reputation is admissible on the question of plaintiff’s purchase in good faith.
    [Ed. Note. — For other cases, see Bills and Notes, Cent. Dig. §§ 1740-1745; Dec. Dig. § 509.]
    7.Bills and Notes (§ 505) — Actions—Evidence.
    Where defendant claimed that he had been induced to execute the note sued on in reliance upon the fraudulent misrepresentations of the payee, evidence that the payee had offered to sell the note for a ridiculously low figure is admissible only on the question of his fraud, and could not affect any one except him or his coconspirator.
    [Ed. Note. — For other cases, see Bills and Notes, Cent. Dig. §§ 1717, 1718; Dec. Dig. § 505.]
    Appeal from Johnson County Court; J. B. Haynes, Judge.
    Action by the First National Bank of Aubrey against W. Y. Chapman and others. From a judgment for the named defendant, plaintiff appeals.
    Reversed and remanded.
    Walker & Baker, of Cleburne, for appellant. S. C. Padelford, of Cleburne, and J. B. Harrell, for appellee.

      For oilier cases see same topic and section NUMBER, in Dec. Dig. & Am. Dig. Key-No. Series & Rep’r Indexes-

   CONNER, C. J.

The appellant bank instituted this suit against appellee W. V. Chapman, as the maker, and C. W. Geers, L. D. Moss, and C. T. Wright, the payees, as in-dorsers on a promissory note for $252.50, dated March 1, 1910, due January 18, 1911, bearing interest from date at the rate of 8 per cent, per annum, and containing the usual clause relating to attorney’s fees. C. W. Geers, L. D. Moss and C. T. Wright made no defense, but the appellee Chapman pleaded, in substance, that on March 1, 1910, he traded to C. T. Wright an automobile of the estimated value of $1,200, for which he received a vendor’s lien note in the sum of $1,452.50; that the note sued on in this ease had been given to Wright as the difference between the estimated value of the automobile and the face value of the vendor’s lien note. Appellee further alleged that at the time of the exchange Wright falsely and fraudulently represented that the lien note was one of two in like amount given as part of the purchase money of 327 acres of land in Wood county, worth about $30 per acre, and which had been sold to one Beauchamp for $9,810, of which $4,905 had been paid in cash. Chapman alleged that he relied upon these representations, but later ascertained the fact that they were false; that the land referred to in the vendor’s lien note amounted to but about 30 acres worth about $5 per acre. Appellee Chapman further alleged that at the time of the exchange the note sued upon had been delivered to Wright, with the agreement that it was not to be transferred and not to be paid until after he (Chapman) had collected the amount due upon the vendor’s lien note.

The appellant bant in reply pleaded that it was the purchaser in good faith for value, and without notice of the fraud, if any, in procuring the note in controversy. Appellee Chapman admitted the plaintiff's cause of action as stated, except as it might be defeated by proof of the facts alleged in his answer as a defense, and was accorded the opening and conclusion both in the introduction of the evidence and in the argument.

A trial before a jury resulted in a verdict and judgment in appellant’s favor against all of the defendants, except appellee W. V. Chapman, as to whom the verdict and judgment was against appellant.

Under the peculiar facts of this ease, we think the judgment must be reversed, because of the failure of the court to give appellant’s special charge No. 4, which is as follows: “You are instructed, if you believe from the evidence that at the time H. G. Musgrove purchased the note in controversy from L. D. Moss that said Musgrove did not have notice that said note had been procured by fraud or misrepresentations or knowledge of such facts in relation thereto, so that his action in taking said note amounted to bad faith on his part, then you will find in favor of the plaintiff against W. Y. Chapman for the amount sued for on the note.”

The evidence tending to show fraud on the part of C. T. Wright in procuring the note in question seems abundant to support the jury’s verdict in that respect. The crucial question is whether it is sufficient to overcome the plaintiff’s insistence that it was a purchaser for value before maturity and in good faith. Moss testified to the effect that he purchased the note from Geers, who, it appears, was a partner in the real estate business with Wright, about the 1st of April, 1910, and paid therefor $200; that he knew nothing of the trade between Wright and Chapman or of the defenses asserted; that a few days after he purchased the note from Geers he sold the note to W. G. Musgrove for the appellant, and received therefor in cash $225. Musgrove testified that he was cashier of the appellant bank, and alone attended to its business in buying notes, lending money, etc.; that on the 6th day of May, 1910, he purchased the note .in controversy from Moss, paying therefor $225 in cash; that the time of this purchase he did not know what Wright paid for it or how he acquired it, nor did he know that Beauchamp was connected with it in any way, nor did he know anything about any agreement between Chapman and Wright relating to the vendor’s lien note, nor any of the conditions attached to it; that he knew both Moss and Geers, who did business with his bank, and regarded them as solvent; their transactions with the bank having been at all times perfectly satisfactory. The appellant also offered the bank books and a memorandum which was to the effect that the note had been purchased on May 6, 1910, and had been later sent to Cleburne, Johnson county, for collection on January 10, 1911. Mr. Musgrove further testified that he had never had any dealings with Wright, and would not have loaned him money on his own name alone.

The evidence relied upon by appellee to defeat the showing so made is, in substance, that Wright had lived in the town of Aubrey, Denton county, where the appellant bank was situated, several years, and that his general reputation in that place, as well also as in other places, was bad both for truth and veracity, and as to honesty and fair dealing; that, immediately after the exchange of the auto for the vendor’s lien note at Wright’s request, Chapman went with him to Ft. Worth, at which place Wright drove at once to Moss’ office, when Wright said to Moss, “Well, I have purchased that automobile”; and Moss inquired, “What automobile?” to which Wright replied, “The automobile from Mr. Chapman,” who was then introduced to Moss; that later the same evening the parties named rode about the city of Ft. Worth, viewing the scenes, and the next morning breakfasted together, at which time Wright inquired of Muss if he was going to Aubrey with him, and that Moss replied, “I believe that was .the agreement” ; that later Moss, Geers and Wright were together in the town of Cleburne, in Johnson county, when Wright offered to sell the note in question to several parties. It is not clear, however, that Moss was present at any time when Wright offered to sell the note, and Moss denied being present or participating in any such effort. Appellee further testified to the effect that he received a letter from Musgrove, cashier of the appellant bank, on May 3, 1910, inquiring if the note in question was valid and would be paid at its maturity; that this letter was received either on the 3d or 4th of May, and replied to the same day; that he therein stated to the writer, Musgrove, that “I was to pay the $252.50 out of the money I was to collect out of the $1,452.50 note. I told him I guess it was not payable until I collected the other note; that that was the trade I had made.” It is not contended, however, that either then or at any other time prior to the maturity of the note sued on, Musgrove or Moss was informed of the alleged fraudulent representations made by Wright. Appellee further testified that, in answer to a letter from appellant on January 7, 1911, he, together with a neighbor, a few days later, went to Aubrey, and there ascertained that Beauchamp was insolvent; that Wright was in bad repute as before stated, and at the appellant bank was informed by some one who was in the cashier’s place that the bank had no record of the note in question.

There may- be some other circumstances relied upon that are not now in mind, but we think we have substantially stated all the material evidence relied upon to defeat the claim that Moss and the appellant bank purchased the note before maturity and for value, without notice of Wright’s fraud.

In this attitude of the proof, if it can in any event be said to sustain the verdict of the jury in appellee’s behalf, we think the court should have affirmatively, and not negatively, as was done in the general charge, instructed the jury that, if either Moss or' Musgrove was a purchaser before maturity and for value, then both Moss and Musgrove at the time of their several purchases must have had actual knowledge of the fact that the note had been procured by fraud or misrepresentations, or must have had knowledge of such facts in relation to the note as made the purchase at the time one in bad faith. See Wilson v. Denton, 82 Tex. 535, 18 S. W. 620, 27 Am. St. Rep. 908; Mulberger v. Morgan, 47 S. W. 379; Hynes v. Winston, 40 S. W. 1025.

We can do-no better than quote in this connection from the case of Wilson v. Den-ton, above. Our Supreme Court there say: “The ordinary rule- of constructive notice which applies to the purchase of property is not applicable in the case of negotiable instruments. As promotive of their circulation a liberal view is taken, which makes the bona fides of the transaction the decisive test of the holder’s right. He is entitled to recover'upon it if he has come by it honestly. Greneaux v. Wheeler, 6 Tex. 525; 1 Dan. Neg. Inst. § 775. It matters not how the vendor came in possession of the bill or note, whether by theft, or fraud, or honestly; the title of the transferee does not depend upon the title of the vendor, but upon his possession, and, if the buyer has acted in good faith and paid a valuable consideration, his title cannot be impugned. An early English ease (Gill v. Cubitt, 3 Barn. & Cress. 466) laid down ithe principle that although the holder had given value for the bill or note, yet, if he took it under circumstances which ought to have excited the suspicions of a prudent and careful man, he could not recover. This was a departure from the earlier rule, which regarded the bona fides as the crucial test by which it was to be determined whether or not the purchaser should be protected against defenses that would be valid against the transferror of the note. But the earlier rule was soon again reverted to, and afterward made even more liberal, and it became the law that, while gross negligence might be evidence tending to show mala fides, and as such admissible, it did not in itself amount to proof of mala fides, and was not sufficient to deprive the holder of his right to recover. If it should be left to a jury to determine as to the degree of caution which a prudent man must exercise on taking such instrument, it would lead to much perplexity and to frequent injustice. This is the law deduced from the English decisions by Mr. Daniel in his admirable work on Negotiable Instruments, section 770, et seq. A review of the American authorities shows by far the greater number concurring in the principle which has been finally established as the law c-f England. Id. § 775. We think the entire question is one of bad faith, and that our Supreme Court adopted this rule as early as the case of Greneaux v. Wheeler. Judge Hemphill said, in Weathered v. Smith, 9 Tex. 625 [60 Am. Dec. 186]: ‘The possession of the instrument, acquired in good faith in the usual course of trade, gives property, whether the person from whom it was received have title or not. This doctrine, founded on the necessity of securing the benefits accruing from the free circulation of commercial paper, had its origin in the case of Miller v. Race, 1 Burrow’s Reports, 452, m application to bank notes, and was subsequently extended to all negotiable instruments'transferable by delivery.’ Thus early in our state was this most salutary principle from thq older commercial states and from England adopted; at a time, too, when its commerce was in its infancy. It is a rule that is now far more imperatively demanded by our commercial interests, which have since then grown to much greater proportions than they were in those days.”

In the case of Mulberger v. Morgan, 47 S. W. 379, it is also distinctly held that the rule that “notice of facts sufficient to put a man of ordinary prudence upon inquiry” has no application to a purchaser of a negotiable instrument before maturity and for value. We do not feel prepared to say that in such case knowledge of no state of facts short of actual notice will be sufficient to defeat the purchase of a note fraudulently procured, but we do think, under the authorities quoted, that the circumstances, if any, relating to the fraud relied upon, and of which the purchaser has knowledge, must be such as to authorize the conclusion of bad faith in the purchase sought to be maintained. We therefore, under the facts of this case, have found ourselves unwilling to affirm this judgment, in the absence at least of a clear instruction on the point indicated by the special charge quoted, and to the refusal of which error has been assigned.

A number of other questions have been raised, but we will dispose of them in a brief manner only. Complaints of the court’s charge we think relate to mere matters of omission calling for appropriate charges on the several questions presented. Special charges Nos. 2 and 3, to the rejection of which complaint is made, are in their nature argumentative and too broadly state the propositions we have principally discussed.

We think appellee’s testimony that at the time of the exchange Wright agreed to keep the note in question and not transfer it, relevant to the issue of Wright’s fraud, and while Beauchamp’s statement to Chapman in Aubrey “that he could not pay the note, and that Wright had skinned him out of what he had,” was clearly hearsay as to appellant, yet its effect was principally to show that Beauchamp was insolvent, and this was otherwise abundantly established, so that the error cannot bo said to be reversible.

The cashier’s statement to appellee on January 17, 1911, that he was unable to find the note in question bore upon the issue of whether the appellant bought the note before maturity, and was therefore properly admitted.

So, too, we think the proof of Wright’s general reputation was admissible as a mere circumstance on the issue of the alleged good faith purchase of the note.

The testimony of Norwood to the effect that Wright offered to sell him the note in question at a ridiculously low figure, etc., was admissible alone on the issue of Wright’s fraud. The statement could not affect one other than Wright or a coconspirator, and this testimony should have been so limited, but there was no request for such limitation, and we decline to reverse on this ground. Other questions are disposed of by what we have already stated.

We conclude that the judgment should be reversed, and the cause remanded.