text:
    RALEY et al. v. D. SULLIVAN & CO. et al.
    (No. 15-2599.)
    (Commission of Appeals of Texas, Section B.
    Jan. 15, 1919.)
    1. Adverse Possession @=>81 — Title of Grantor.
    Where the one-time -owner had by prior conveyance parted with whatever title he had to the land, the claims of a subsequent grantee to title by virtue of the three-year statute of limitations cannot be sustained.
    2. Bankruptcy @=>438 — Effect of Discharge.
    Title of a bankrupt to land,. though not scheduled as an asset, passes to his trustee, and, notwithstanding the bankrupt’s discharge, he cannot recover the same; no facts being shown revesting title in him.
    3. Limitation of Actions @=>118(2) — Interruption of Time — Piling Suit.
    Merely filing suit did not arrest the running of the statute, where the suit was practically abandoned by failure to prosecute.
    4. Limitation of Actions @=197(2) — Run- ' ning of Statute — Fraudulent Concealment.
    Evidence held insufficient to show such a fraudulent concealment by the grantee of land who had not recorded his conveyance as to prevent the running of limitations in his favor as against one holding a vendor’s lien note executed by a prior grantee.
    5. Limitation of Actions @=>195(5) — Running of Statute — Burden of Proof.
    Where the holder of a vendor’s lien note claimed that the fraudulent concealment by the grantee of the land of the fact of his ownership stopped the running of limitations in his favor, the holder of the note has the burden of showing the fraudulent concealment, his ignorance of the facts, and that he could not by reasonable diligence have discovered the fraud.
    6. Appeal and Error @=>1177(7) — Review— Remand.
    In an action involving title to land and the foreclosure of vendor’s lien notes, where evidence was insufficient to support a recovery, but on another trial additional evidence might be offered, held, that judgment would be reversed and cause remanded.
    Error to Court of Civil Appeals of Fourth Supreme Judicial District.
    Action by D. Sullivan & Co. and others against Carrie Coleman, consolidated with an ■action by D. M. Poor against Helen Raley and others. A judgment in favor of D. M. Poor against Helen Raley and another, and in favor of D. Sullivan & Co., was affirmed by the Court of Civil Appeals (159 S. W. 99), and Helen Raley and others bring error.
    Reversed and remanded.
    On May 25,1892, M. H. Poor was the owner of lot No. 1 in Mission Ridge, in Bexar county, Tex., having a regular chain of title from the sovereignty of the soil.
    On that date, M. H. Poor conveyed this land to R. W. Coleman, reciting a cash consideration of $600 and a note for $650 due two years after date, and a vendor’s lien was retained In the deed to secure payment of the note.
    On May 27,1892, M. H. Poor indorsed and delivered the note above described to D. M. Poor. On April 29, 1893, Carrie Coleman, surviving wife of R. W. Coleman and his sole heir, conveyed the land referred to to D. M. Poor. The deed reciting a cash consideration of $600 and the assumption by the vendee of the note given by R. W. Coleman to M. H. Poor, and a vendor’s lien was reserved in the deed to secure the payment of the note. This deed, however, was not filed for record until January 4, 1912.
    On February 2, 1894, M. H. Poor, by warranty deed, conveyed to D. M. Poor the land in controversy.
    The evidence shows that the note executed by R. W. Coleman was indorsed and delivered by D. M. Poor to Sullivan & Co. after the execution of the deed of Carrie Coleman to D. M. Poor.
    On May 24,1908, Sullivan & Co. filed a suit against Carrie Coleman and the unknown heirs of R. W. Coleman, deceased, asking for recovery on the vendor’s lien note and to foreclose the lien. No citation was ever issued and no steps taken to prosecute this suit until 1912, when a motion to consolidate ■the suit with a suit subsequently brought by D. M. Poor v. Helen Raley was made, and tlie suits were consolidated by order dated October 21, 1912.
    On November 24, 1906, M. H. Poor conveyed the lot in controversy to Helen Raley, and the deed was filed for record the same day. On October 2, 1909, D. M. Poor filed his voluntary application in bankruptcy in the proper federal court, on October 4, 1909, he was duly adjudged bankrupt, and on October 22, 1909, W. A. Hadden was appointed trustee of the estate. The schedules attached to the application show debts to the amount of more than $40,000 and no property except that claimed and afterwards set apart as exempt. The lots in controversy were not scheduled as assets, nor was the note executed by Coleman listed as a debt. On December 18, 1909, D. M. Poor received his discharge. There is nothing in the record to show whether the estate in bankruptcy was ever finally closed and the trustee discharged or not. On November 17,1911, D. M. Poor filed an action of trespass to try title against Helen Raley and J. Raley, seeking to recover the property in controversy. J. Raley was afterwards dismissed from the case. On April 1, 1912, the case of D. M. Sullivan & Oo. v. Carrie Coleman, above referred to, was consolidated with the case of D. M. Poor v. Helen Raley et ah, and Sullivan & Co. by amended petition made 3M. H. Poor a party and sought a foreclosure as against him.
    Carrie Coleman Burr, formerly Carrie Coleman, joined by her husband - Burr, intervened in the consolidated case.
    The pleadings are very voluminous, but we will undertake, as briefly as possible, to state the several contentions of the parties.
    D. M. Poor asserted title in himself against Helen Raley and Carrie Coleman Burr and „ asked for judgment for the title and possession of the land. Carrie Coleman Burr sought to recover the title and possession as against both Helen Raley and D. M. Poor. Her claim was based upon the theory that she in her deed to D. M. Poor had reserved the superior title to the land to secure payment of the note executed by R. W. Coleman, and that, as Poor had failed to pay the note assumed by him, she was entitled to'recover the land. Sullivan & Co. asked a recovery against D. M. Poor on the vendor’s lien note alleging his assumption of the same and for a foreclosure against all the other parties to the suit. Helen Raley claimed title under deed from M. H. Poor, also by virtue of the three and five years’ statute of limitation, and pleaded the four years’ statute of limitation as to the suit of Sullivan & Co. She also claimed that, D. M. Poor having been adjudged a bankrupt, whatever title he had was vested in the trustee in bankruptcy, and therefore he was not entitled to recover. Sullivan & Co., in reply to D. M. Poor, alleged that, by reason of the failure of Poor to list their claim in his bankruptcy schedule, his discharge did not affect their debt, and D. M. Poor, having pleaded limitation against the note in reply thereto, pleaded fraudulent concealment by Poor of the fact of his assumption of the debt by failure to record the deed from Carrie Coleman.
    The case was tried by the court, and judgment rendered in favor of D. M. Poor against Helen Raley and Mrs. Burr for the title and in favor of Sullivan & Co. against D. M. Poor for their debt and a foreclosure against all the defendants.
    Such other facts as are essential will be stated in the opinion.
    James Raley, Wm. Aubrey, and C. S. Robinson, all of San Antonio, for plaintiffs in error.
    Denman, Franklin & McGown, of San Antonio, for defendants in error.
   MONTGOMERY, P. J.

(after stating the facts as above). We will first attempt to settle the question of title before attempting to decide what, if any, rights Sullivan & Co. had as owners of the vendor’s lien note.

The title to the property was in M. H. Poor when he sold the land to R. W. Coleman on May 8, 1892, and reserved a vendor’s lien to secure the purchase-money note. M. H. Poor indorsed the note to D. M. Poor on May 27, 1892, and later by deed conveyed the land to him also. The indorsement and delivery of the note and deed by M. H. Poor divested him of all title and vested all his rights in both the debt and the land in D. M. Poor.

The deed of Carrie Coleman, the widow and heir of R. W. Coleman, to D. M. Poor-, passed to D. M. Poor her title to the land subject only to the payment of the vendor’s lien note. The indorsement of the vendor’s lien note to Sullivan & Co. gave them only a lien on the land.

The effect of these transactions was to vest the title to the land in D. M. Poor subject only to a lien in favor of Sullivan & Co. to secure the payment of the note. We do not think that Carrie Coleman Burr was in position to recover the land against D. M. Poor. At-the time she intervened she did not own the debt. Looking at her claim in the most favorable light, she, as between herself and D. M. Poor, had a superior title to the land for the purpose of securing the payment of the note. Had she owned the note she would have been in position to assert this superior title against D. M. Poor; but, not having paid the note, we think she was not entitled to recover the land as against D. M. Poor or the party in possession.

If, at the time the deed from Mrs. Burr to D. M. Poor was executed, she had taken his note for the purchase money secured by a vendor’s lien, she could have asserted her superior title, provided she retained ownership of the note. If she had parted with the note, she would have had no title upon which she could have recovered the land.' After parting with the note, she would have held the so-called superior title merely as trustee for the holder of the note. Roy v. Clarke, 75 Tex. 31, 12 S. W. 845, and Farmers’ Loan & Trust Co. v. Beckley, 93 Tex. 272, 54 S. W. 1027. It seems to us that Mrs. Burr is in no better position than she would have been in the suppositious ease stated. Here she reserved a vendor’s lien to secure a note due to another person. The superior title reserved by her could be asserted only to secure the debt. So far as we can find upon examination of the eases in this state, the superior title of a vendor can never be asserted except by one who owns both the debt and superior title. We are not disposed to extend the effect of the reservation of the vendor’s lien in favor of a vendor any further than required by the decisions of the Supreme Court of this state.

The cases cited by counsel for Mrs. Burr are all cases in which the superior title and ownership of the debt were vested in the same person. What we have said disposes of Mrs. Burr’s intervention.

The facts stated show that Helen Ra-ley acquired no title by virtue of her deed from'M. H. Poor. Long before the execution of the deed, JtT. H. Poor had indorsed the note given by Coleman to D. M. Poor and had also conveyed the land to D. M. Poor. Helen Ra-ley also failed to establish her title either under the three or five year statute of limitation. As to the five-year statute of limitation, it is sufficient to say that the deed under which she claimed title had not been filed for record five years.at the time of the institution of the suit by D. M. Poor, and therefore no title was vested in her under that statute. Her claim under the three-year statute cannot be sustained because .at the time M. H. Poor conveyed the land to her he had by prior conveyances parted with whatever title he had to the land. We will not discuss this question. It has been repeatedly so held in this state. See opinion by Chief Justice Phillips in Burnham v. Hardy Oil Co., 108 Tex. 555, 195 S. W. 1139, where this question is fully discussed.

The foregoing leads to the conclusion that the title to the land was good in D. M. Poor unless his title had passed to his trustee in bankruptcy and had not been revested in him.

D. M. Poor upon his own application was adjudged a bankrupt, and, although at the time he filed his petition he owned the property in controversy, he failed to schedule the same or to disclose the fact of such ownership. His deed was not on record, and he gives no explanation of his failure to schedule this property. He listed no property except that claimed as exempt, and his petition shows that he owed debts amounting to more than $40,000. He obtained his discharge on December 18,1909, and on November 17,1911, filed this suit to recover the property in controversy. The record does not show whether the bankruptcy proceeding has been finally closed' and the trustee discharged or not.

We think that the title of D. M. Poor by operation of law passed to and was vested in his trustee in bankruptcy and that no facts are shown which have the effect of revesting the title in him. This conclusion is based upon the decision of the Supreme Court of the United States in the case of First National Bank v. Lasater, 196 U. S. 115, 25 Sup. Ct. 206, 49 L. Ed. 408.

The only thing left for determination is the rights of Sullivan & Co. As shown by our statement, they had a lien on the land to secure the note held by them. The note was dated May 25, 1892, and, was due two years after date, and would therefore become barred by limitation on May 28, 1898. On May 24, 1898, they filed suit against Carrie Coleman and the unknown heirs of R. W. Coleman, deceased, to recover on the note and for a foreclosure. No citation was ever issued in this case, and nothing whatever was done in the case except to file the petition and perhaps file an affidavit for service. When this case was consolidated with the case of D. M. Poor and Helen Raley, D. M. Poor pleaded the four-year statute of limitation as against the debt and lien of Sullivan & Co. Sullivan & Co. to avoid the statute alleged fraudulent concealment by Poor of the execution of the deed to him by Carrie Coleman and of the fact that Poor had assumed the debt.

The filing of the suit in 1898 against Mrs. Coleman and unknown heirs of R. W. Coleman under the facts shown did not arrest the running of the statute of limitation. The suit was practically abandoned by a failure to prosecute. Ricker v. Shoemaker, 81 Tex. 22, 16 S. W. 645. The facts, we think, are not sufficient to show such fraudulent concealment on the part of D. M. Poor as to prevent the running of the statute in his favor. The only fact shown was that he failed to record the deed from Carrie Coleman by the terms of which he assumed the debt. There was no proof that Sullivan & Co. did not know of the assumption and no proof of any effort on the part of Sullivan & Co. for a period of about 14 years to collect the debt by a foreclosure on the land. The burden was on Sullivan & Co. to show the fraudulent concealment, their ignorance of the facts, and that they could not by reasonable diligence have sooner discovered the alleged fraud. Ford v. Clements, 13 Tex. 592; Ney v. Rothe, 61 Tex. 374. We further are of opinion that the bare fact of the failure of D. M. Poor to record the deed evidencing the assumption of the debt without other evidence to show a fraudulent design would not be such fraud as to prevent the running of the statute of limitation. Poor’s failure to record the deed did not deprive Sullivan & Co. of their right to collect their debt from the maker of the note or from his estate or to foreclose the lien. Even if Sullivan & Co. had known of the assumption, they were not bound to accept the vendor, Poor, as their principal debtor and could have foreclosed their lifen disregarding the assumption.

The views herein expressed necessarily lead to the conclusion that D. M. Poor, being plaintiff in the action to try title and having failed to show title in himself, was not entitled to recover; that Carrie Coleman Burr failed to show title authorizing a recovery by her of the land; and that Sullivan & Co. were not entitled to the personal judgment against D. M. Poor nor to a foreclosure of the lien.

In view of the condition of this record, and the fact that additional evidence may be offered on another trial, we have concluded that the ends of justice may be best served by reversing and remanding the entire case, for further proceedings not inconsistent with this opinion.

We therefore advise .that the judgment of both the district court and the Court of Civil Appeals be reversed, and this cause be. remanded to the district court for a new trial, and that all costs of the appeal and writ of error proceedings be taxed against D. M. Poor, Sullivan & Co., and Carrie Coleman Burr, and-Burr, her husband, in equal portions, and that Helen Raley recover from all the other parties above named the cost of her appeal.

PHILLIPS, C. J.

The judgment recommended by the Commission of Appeals is adopted and will be entered as the judgment of the Supreme Court. The case is correctly remanded upon the ground stated by the Commission in its opinion.
      <§=>For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


source: Caselaw Access Project

author: SONFIELD, P. J. PHILLIPS, C. J.

license: Public Domain

text:
    THOMPSON et al. v. HARMON.
    (No. 2-2544.)
    (Commission of Appeals of Texas, Section A.
    Jan. 15, 1919.)
    1. Appeal and Eeeoe <§=>79(1) — Finality op Judgment.
    Where the court overruled motion for continuance to bring in other parties as sought by cross-bill, such parties were not before the court, and it was not necessary, in order to be final, that the judgment dispose of them, or of any cause of action asserted against them.
    2. Appeal and Eeeoe <§=>79(1) — Finality op Judgment.
    In action against partnership operating bank, cross-bill held to seek no relief as against temporary administrator of one of partners, so that judgment was final, although it failed to dispose of his interest.
    3. Pabtnebship <§=>291 — Retieing Paetnees —Liability—Notice op Dissolution.
    It is incumbent upon members of partnership to give due notice of dissolution, and actual notice is required to those who have had dealings with the partnership.
    4. Pabtnebship <§=>296(3) — Notice op Dissolution — Bueden op Peo op.
    Where it is sought to hold a retired member liable by one who has dealt with the partnership prior to its dissolution, the burden of proof to establish due notice or knowledge is upon such member.
    5. Pabtnebship <§=>291 — Retieing Paetnees —Liability—Notice.
    To those who had knowledge of, .but no dealings with, the partnership prior to the dissolution, actual notice thereof is not required; a public notice given in some reasonable manner being deemed sufficient.
    6. Pabtnebship <§=>299 — Retieing Paetnees —Liability—N otice.
    Creditors becoming such subsequent to dissolution without knowledge of the existence of the partnership are entitled to no notice of the dissolution.
    7. Pabtnebship <§=>296(3) — Liability op Re-tieing Paetnees — Bueden op Peoop.
    One seeking to recover against a retiring partner must establish that he knew, at the time of the transaction, that a partnership existed, of which the one sought to be held liable was a member; that he was in ignorance of any dissolution; and that he entered upon the transaction or extended credit in reliance upon the partnership as it had theretofore existed.
    8. Pabtnebship <§=>296(3) — Retieing Paet-nees — Liability.
    In the absence of evidence that one dealing with partnership did so in reliance upon certain persons being members, he could not recover from those persons who had retired from the partnership.
    9. Pabtnebship <§=>296(3) — Retieing Paet-nees— Liability — Evidence op General Reputation.
    Knowledge or notice to creditors of partnership and ignorance of its dissolution cannot be established .by evidence of general reputation and notoriety in the community as to whether the ' partnership continued in existence.
    Error to Court of Civil Appeals of Sixth Supreme Judicial District.
    Action by M. H. Harmon against W. R. Thompson and others. To review judgment (152 S. W. 1161) of the Court of Civil Appeals affirming judgment against all defendants, they bring'* error.
    Reformed and affirmed, in accordance with the recommendation of the Commission of Appeals.
    S. L. Samuels, Geo. Thompson, and Theodore Mack, all of Ft. Worth, for plaintiffs in error.
    R. L. Carlock and W. P. McLean, both of Ft. Worth, for defendant in error.

   SONFIELD, P. J.

This action was brought by plaintiff, M. H. Harmon, against defendants, W. R. Thompson and J. Z. Carter and G. W. Duke as temporary administrator of the estate of W. A. Green, deceased.

Plaintiff alleged that on the 23d day of December, 1905, defendants, Thompson, Carter, and W. A. Green formed a partnership for the operation of a private bank under the name of Citizens’ Bank of Newark, Tex., with Thompson president, Carter vice president, and Green cashier. Business was actively begun in the spring of 1906, and continued until the bank failed or suspended on the 30th day of January, 1911. There was never a dissolution of the partnership, or, if any dissolution in fact occurred, no notice thereof was given those then dealing with the bank or to the public. Defendants continued to hold themselves out and permitted Green to hold them out as partners. On the date of the suspension of business by the bank there was owing to depositors the sum of $22,008.-47. Of this amount the sum of $2,136 was owing to plaintiff individually, and the remainder had been duly assigned to hipi by the respective creditors. All the depositors and creditors placed their money in the keeping of the bank believing that defendants Thompson and Carter, together with W. A. Green, constituted the partnership owning and conducting same. If there was a dissolution of, or any change in, the partnership the creditors were in ignorance thereof. Thompson and Carter were the financially responsible members of the partnership. Plaintiff sought a recovery of the amount of the deposits and an additional sum of $1,100 due by the bank in a transaction pertaining to certain vendor lien notes with H. B. Otis; this claim having been assigned to plaintiff.

Defendants Thompson and Carter, among other things, pleaded under oath that the partnership was dissolved in the month of October, 1907, when Green became the sole owner of the business, since which time they had no connection with Green or with the business of the bank, which could have been known to plaintiff and to all those under whom he claimed by the exercise of reasonable diligence. They denied holding themselves out as partners, and, if so held out by Green, it was without their knowledge or consent.

The tenth paragraph of the answer was in the nature of a cross-bill against the estate of AV. A. Green, deceased, the surviving wife and child of Green, and any administrator of his estate, seeking a recovery in the event any judgment should be rendered against these defendants. It was alleged that no permanent administrator had yet been appointed, and the claim of the defendants was one which a temporary administrator was not competent to approve or reject. Leave was asked to make the surviving wife and child of Green and such administrator, when appointed, parties to the action.

Duke, the temporary administrator, filed an answer alleging full authority under the appointment of the court to represent the interest of the estate of Green in all matters pertaining to this litigation. Therein he denied the allegations in the answer of defendants Thompson and Carter, seeking to hold the estate of Green for the entire indebtedness, alleging that Thompson and Carter were equally liable with Green for all the said indebtedness.

Before going to trial, defendants Thompson and Carter made application for continuance of the case, in which application they recounted substantially the allegations contained in their cross-bill against the estate of Wi A. Green and sought a continuance in order that the surviving wife and child of Green and the permanent administrator, when appointed, might be brought before the court, and the issues raised in the cross-bill between the said defendants and such parties determined.

The trial court charged the jury upon two theories, that of liability as partners, no dissolution taking place, or, in the event of actual dissolution liability based upon failure to give nqtice thereof and of permitting themselves to be held out by Green as partners. The court instructed the jury to state the ground upon which liability, if any, was predicated.

The jury returned a verdict in favor of the plaintiff against all the defendants for the amount of deposits owing by the bank in the sum of $22,008.47 with interest and for the principal of the Otis notes, amounting .to $1,-100 with interest, and 10 per cent, additional' as attorney’s fees.

The verdict, as stated therein, was found under section 2 of the court’s charge, that is, on liability the result of failure to give notice of dissolution, and the holding out of defendants as partners. Upon this verdict judgment was entered against all the defendants. Defendants Thompson and Carter appealed, and the judgment of the district court was affirmed by the Court of Civil Appeals. 152 S. W. 1161.

The evidence establishes that the partnership between defendants, Thompson and Carter and W. A. Green, deceased, was entered into, as alleged. No notice of any kind or character was given to those who were dealing with the bank or to the public at large of the dissolution of. the partnership. The bank, at the time of its suspension," owed the various depositors the sum of $22,008.47 exclusive of the Otis notes, all of which had been duly assigned to plaintiff; -of said amount, the sum of $10,656.76 was due persons who were creditors of and dealing with the bank at the time of the dissolution, plaintiff’s individual claim being among the number, and the balance of $11,351.71 was due the persons who became depositors and creditors subsequent to the dissolution of the partnership. The transaction with reference to the Otis notes took place subsequent to the dissolution, and the amount of same was as found by the jury.

Defendants urge, that the judgment lacks finality, no disposition being madet therein of the cross-action of defendants Thompson and Carter against the administrator of the estate of W. A. Green. G. W. Duke, as temporary administrator of said estate, was made party defendant by the plaintiff. Defendants Thompson and Garter, by plea and exception, as well as in their answer and cross-bill, denied the right of Duke, as temporary administrator, to represent the estate in the matters involved and the cross-bill sought to implead the surviving wife and child of Green and the permanent administrator of the estate, when appointed. Prior to going into trial, these defendants filed a motion for continuance in order to bring before the court the surviving wife and child of Green and the permanent administrator of the estate, when appointed. The motion contained substantially the allegations of defendant’s cross-bill denying the right of Duke as temporary administrator to represent the estate in the matters in litigation, thus necessitating the presence of the permanent administrator and the surviving wife and child of Green. The court overruled the motion. This action of the court was tantamount to a refusal by the court to allow the bringing in of new parties, as sought by the cross-bill. Such parties so sought to be brought in were therefore in no manner before the court, and it was not necessary for the judgment to dispose of them, or of any cause of action asserted against them. Ellis v. Harrison, 52 S. W. 581. We agree with the conclusion of the Court of Civil Appeals that the cross-bill sought no relief against Duke as temporary administrator or against the estate of Green under temporary administration. It results ■ that in our opinion the judgment was final in its nature.

The verdict of the jury involved the finding that the partnership was dissolved in October, 1907. At that time the bank had two classes of depositors represented herein, those who had dealings with the bank prior to the dissolution, and those whose dealings began subsequent thereto. The rules of law applicable to the two classes are essentially dif-. ferent.

It is incumbent upon the members to give due notice of the dissolution of a partnership. To those who have had dealings with the partnership actual notice is required. In the absence of such notice, or of knowledge of the dissolution, the liability of the members continues as to such persons. Tudor v. White, 27 Tex. 584; Davis v. Willis, 47 Tex. 154. Where a member is sought to be held liable by one who thus dealt with the partnership prior to its dissolution, the burden of proof to establish notice or knowledge is upon such member. 2 Bates, Partnership, 621.

To those who had knowledge of, but no dealings with, the partnership prior to the dissolution, actual notice is not required; a public notice given in some reasonable manner being deemed sufficient. 20 R. C. L. 967. Having knowledge of .the existence of the partnership, one can of right presume its con-, tinuance until some public notice of change or dissolution is given. This is especially true where the business is continued under the same firm name.

Those having subsequent dealings without knowledge of the existence of the partnership are entitled to no notice of any kind of the dissolution. A continuing relation cannot be relied upon by one without knowledge that such relation once existed. Hence, subsequent creditors without such knowledge cannot fasten liability upon a retiring member through the mere failure to give notice of dissolution. Swigert v. Aspden, 52 Minn. 565, 54 N. W. 738. The basis of such liability is estoppel. Having held himself out, or permitted others to hold him out, as a partner whereby persons dealing with the partnership are induced to believe him a member thereof, and through such belief to extend credit to the partnership, he cannot as to such persons deny the partnership, although it does not in fact exist. This being the sole ground of liability, one seeking to recover against a retiring member must establish that he knew-at the time of the transaction that a partnership existed, of which the one sought to be held liable was a member; that he believed it still existed, being in ignorance of any dissolution ; and that he entered upon the transaction or extended credit in reliance upon the partnership as it had theretofore existed. Wallis v. Wood, 7 S. W. 852; Pratt v. Page, 32 Vt. 13; Thompson v. Bank, 111 U. S. 529, 4 Sup. Ct. 689, 28 L. Ed. 507; 22 Am. & Eng. Law, 58.

The undisputed evidence establishes that no notice of any kind was given of the dissolution of the partnership between Green and these defendants. The verdict of the jury imports that those depositors who had dealt with the bank prior to the dissolution were without knowledge of such dissolution. It follows that, as to his individual deposit and the deposits assigned to him by persons having so dealt with the firm, plaintiff is entitled to a recovery. Such deposits amounted con-cededly to the sum of $10,656.76. As to those depositors whose dealings with the bank began subsequent to the dissolution, there is no evidence of knowledge of the existence of the partnership between Green and these defendants prior to or at the time of such dealings, or that they dealt with the bank in reliance upon such partnership, save and except as to the- following, the amounts of the deposits being set opposite the names: C. A. Adams, $928.10; Peden & Son, $260.25; G. W. Duke, trustee, $73.12; Harrison Company, $378.41; and C. W. Rickman, $250.85. In each instance with reference to the above deposits the depositors testified to such knowledge and reliance. As to the deposit of H. B. Otis and his sale of the Bradford vendor lien notes, while his testimony m.ay be construed as evi.dencing a knowledge of the existence of the partnership, there is no evidence that he made the deposit or had the transaction with reference to the notes in reliance upon these defendants being members of the partnership. Without such reliance there can be no recovery.

Plaintiff adduced evidence of general reputation and notoriety in the community in which the bank was situated, that Green and these defendants were partners, and that the partnership continued to the date of the'fail-' ure of the bank. Knowledge by a creditor of the existence of the partnership and ignorance of its dissolution cannot be established in this manner. General reputation and notoriety may exist, and yet the party dealing with the firm may have no knowledge thereof. That which is to be established is not the knowledge of others upon which the general reputation and notoriety may be based, hut the facts within the knowledge of the creditor himself. Wallis v. Wood, 7 S. W. 852. But even if knowledge of the existence of the partnership and ignorance of its dissolution could he thus established, reliance upon the partnership as it originally existed could not thus be established. It could not be presumed from general reputation and notoriety that there was knowledge of the existence of the partnership and ignorance of its dissolution, and based upon this the further presumption obtain, that the party in such dealing relied upon the knowledge and ignorance so presumed. From the record the case appears to have been fully developed.

We are of opinion that the judgment of the Court of Civil Appeals should be here reformed, granting a recovery by plaintiff against defendants Thompson and Carter in the sum of $12,547.49, with interest thereon at the rate of 6 per cent, per annum from January 31, 1911, and as so reformed the judgment is in all respects affirmed.

PHILLIPS, C. J.

The judgment recommended by the Commission of Appeals is adopted and will be entered as the judgment of the Supreme Court.
      <®=»For other cases see same topic and KEY-NUMBER, in all Key-Numbered Digests and Indexes


author: TAYLOR, J. PHILLIPS, O. J.

text:
    RICHARDS v. RULE.
    (No. 15-2597.)
    (Commission of Appeals of Texas, Section A.
    Jan. 15, 1919.)
    1. Quieting Title <®=»35(2) — Petition — Sufficiency.
    A petition in a suit to remove a cloud from title held to sufficiently allege that the execution of the sheriff’s deed under which plaintiff claimed was made pursuant to an order of sale.
    2. Evidence <⅞=83(7) — Presumptions.
    There is a prima facie presumption that official acts are regular, but the presumption of the regularity of a sheriff’s acts as recited in his deed applies to such recitations only as are made by virtue of statutory requirement, and the presumption cannot be indulged to the extent of supplying the necessary authority for the sheriff’s acts.
    3. Evidence ⅞&158(5) — Sheriff’s Deeds —Recitals.
    As there is no statutory requirement in Texas that a sheriff’s deed shall contain a recital of the authority under which it is executed, such recital is not competent secondary evidence of the sheriff’s power to sell.
    4. Evidence <3=^177 — Secondary Evidence —Deeds—Recitals.
    The fact that the best evidence of a sheriff’s authority to sell is not available, and that proper predicate has been laid for secondary evidence, does not alter the rule that recital in a sheriff’s deed is not competent evidence of his power to sell.
    5. Evidence <⅜^158(5) — Judicial Sales.
    Whether a sheriff’s deed was executed by virtue of the requisite authority may be established by competent secondary evidence, and the question is not foreclosed by the fact that the execution docket contains no entry of the issuance of an order of sale.
    6. Appeal and Error <®=>1177(6) — Determination — Remand.
    Where plaintiff claimed under a sheriff’s deed, but the issue of the sheriff’s authority to execute the deed was not fully developed, notwithstanding two prior trials, held, under circumstances, that a judgment for plaintiff, who did not show the sheriff’s authority, should be reversed, and the cause remanded, instead of judgment being rendered for defendant.
    Error to Court of Civil Appeals of Seventh Supreme Judicial District.
    Suit by T. J. Richards against Johnnie Floyce Rule. A judgment for plaintiff was reversed, and judgment rendered for defendant-by the Court of Civil Appeals (159 S. W. 386), and plaintiff brings error.
    Reversed, and cause remanded for new trial.
    J. M. Hawkins, of Hempstead, and R. D. Browne, of Paducah, for plaintiff in error.
    M. M. Hankins, of Quanah, for defendant in error.
   TAYLOR, J.

The plaintiff, T. J. Richards, sued Johnnie Floyce Rule to remove cloud from the title to 27 town lots in Paducah, Oottle county, Tex. The case has been twice tried, and each time without the intervention of a jury. Judgment in the lower court was for the plaintiff on both trials. The first appeal resulted on the original hearing in an af-firmance, and on motion for rehearing in reversing and remanding the cause. 149 S. W. 1073. On the second appeal the judgment was reversed and rendered in favor of the defendant on the ground that the plaintiff failed both to allege and to prove that the sheriff’s deed through which the plaintiff claimed title was executed in pursuance of an order of sale. 159 S. W. 386.

If the deed referred to is valid, the plaintiff holds the superior title and is entitled to the relief sought. In considering whether effect should be given the deed under the present state of the record, two questions arise:

First. Did the plaintiff sufficiently allege that the execution of said deed was in pursuance of an order of sale?

Second. Is the recital by the sheriff in said deed that its execution is by virtue of an order of sale competent secondary evidence of the sheriff’s authority to sell?

The plaintiff pleaded his title specifically, setting out the third and fourth muni-ments of the title, and his allegations concerning them, as follows:

“(3) Judgment for debt and foreclosure of an attachment upon said described property in a suit wherein S. N. Harwell was plaintiff, and R. E. Avents was defendant. Attachment levied on said property on the 11th day of June, 1894, which judgment and attachment is on record in the justice court of Cottle county, Tex., and shown to have been recorded Juné 12, 1894, in volume 1, page 7, Attachments Records of Cottle County, Tex.
“(4) Sheriff’s deed by virtue of an order of sale issued on said attachment proceedings and judgment from the justice court, by J. L. Gober, sheriff of Cottle county, Tex., for R. E. Avents and Mrs. N. A. Harwell, dated January 23, 1895, and filed for record January 30, 1895, and recorded in volume 6, page 194, Deed Records of Cottle County, Tex.”

The foregoing, excerpts from the petition are sufficient within themselves to answer the first question in the affirmative. While paragraph 4 of the excerpt is descriptive in form, it contains the essential declarations concerning the issuance of an order of sale. The fact that the matters alleged are recited in the instrument pleaded does not rob the allegations of their assertive force, and certainly not when the averments are alleged in the language of the pleader, as in this case. The excerpts quoted apprise the defendant in general terms of the plaintiff’s claim that the deed was executed by the sheriff by virtue of the power conferred by an order of sale, and paragraph 4 identifies the order by reference to the court and cause out of which it issued. The plaintiff sufficiently alleges, as against a general demurrer, the issuance of the order of sale.

The sheriff’s deed relied on by the plaintiff in error contains the following recitation :

“Whereas by virtue of a certain order of sale issued out of the justice court of precinct No. 1, •Cottle county, Tex., in favor of S. B. Harwell v. R. E. Avent, on certain judgment and decree of sale rendered on the 5th day of October, 1894, and directed and delivered to me as sheriff of Cottle county, commanding me to sell the premises described in said order of sale, I, J. S. Gober, sheriff as aforesaid, did upon the 10th day of November, 1894, advertise the said premises as described in said order for sale by causing a notice of the time and place of said sale to be published for three successive weeks in the Paducah Bulletin, a weekly newspaper published in Cottle county, Tex., the first notice appearing in said newspaper on the 10th day of November, 1894, Tuesday being the 4th day of December, A. D. 1894, within the hours prescribed by law offered said premises for sale at public vendue in the county -of Cottle, at the courthouse door thereof, and at said premises hereinafter described and fully set out were struck off to Mrs. N. A. Harwell, for the sum of $50, she being the highest and best bidder, and that being the highest and best bid for the same.” >

The deed not having attained the status of an ancient document, the question arises as to whether its recital of the sheriff’s authority to sell is competent secondary evidence of such authority, binding on others than the immediate parties thereto. There is a prima facie presumption that official acts are regular (Willis v. Smith, 66 Tex. 31, 17 S. W. 247); but the presumption of the regularity of the sheriff’s acts as recited in his deed applies to such recitations only as are made by virtue of statutory requirement. This presumption cannot be indulged to the extent of supplying the necessary authority for the sheriff’s act. Howard & North, 5 Tex. 310, 51 Am. Dec. 769; R. C. L. vol. 10, p. 881.

Wigmore on Evidence, vol. 3, § 1664(d), says:

“A question of much interest, and in great controversy, has been whether the recitals in a sheriff’s deed are admissible to prove his authority to sell, without producing the judgment and the execution. On principle, the solution is as follows: (1) The deed is not valid unless the sheriff had authority to sell; that authority to sell could come only from a judgment against the owner and a writ of execution, based upon the judgment, ordering the sheriff to sell; this judgment roll therefore (or a certified copy) must be produced, in order to prove the sheriff’s authority: (2) Even if it could be assumed that the sheriff’s office gives him a general authority to recite that he has in this instance a specific order to sell, nevertheless, since this order is contained in a written document, the contents of the document must be proved by production or by copy; unless we are further to assume that the sheriff has an implied authority both to state the contents of the judgment and to state them in summarized form. These steps of assumption have usually proved too radical for the courts to take on common-law principles.”

As there is no statutory requirement in this state that a sheriff’s deed shall' contain a recital of the authority under which it is executed, we conclude that such recital is not competent evidence of the sheriff’s power to sell. Nor does the fact that the best evidence is not available, and that a proper predicate has been laid for the introduction of secondary evidence, alter the rule.

Whether the sheriff’s deed was or was not executed by virtue of the requisite authority may be established by competent secondary evidence, and the question is not foreclosed by the fact that the execution docket contains no entry of the issuance of an order of sale. ‘ This issue, it is apparent, has not been fully developed, notwithstanding the case has been twice tried on the same pleadings. It was not raised specifically until after the case had been once affirmed, once reversed and remanded, again tried, and original briefs had been filed by both the appellant and appellee. It was raised as fundamental error by the appellant in his supplemental brief filed on second appeal, and the error pointed out was such as to require a reversal of the judgment. Whether the opinion of the Court of Civil Appeals rendering the judgment in favor of the defendant should be affirmed under such circumstances is the remaining question for decision.

The purpose of the litigation is to correctly determine the issues raised, and, while a speedy disposition of the case is desirable, the number of times it has been tried should not be given any weight in its decision under the circumstances disclosed by the record, and so long as the vital issue is in doubt. The effect of rendering the judgment in the present state of the record would be to divest the plaintiff of his title held for 15 years under a recorded deed without an attack on its validity, while the issue on which its validity depends still remains in doubt. Judge Dibrell, in the case of Paris & G. N. Ry. Co. v. Robinson, 104 Tex. 492, 140 S. W. 439, before the court on a second appeal, said:

“As long as there is a probability that a case has for any reason not been fully developed, this court will not render judgment on the insufficiency of the evidence. In other words, it must be apparent to the court that the ease has been fully developed, and that there is no probability that any other evidence can be secured before it will render judgment.”

The rights of the parties should not be foreclosed in the present state of the record by a rendition of the judgment. We are of opinion that the judgments of the trial court and the Court of Civil Appeals should be reversed, and the cause remanded for a new trial.

PHILLIPS, O. J.

The judgment recommended by the Commission of Appeals is adopted and will be entered as the judgment of the Supreme Court. The ease is correctly remanded upon the ground stated by the Commission in its opinion.
      <S=»For other oases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: McCLENDON, j. PHILLIPS, C. J.

text:
    WEBB et al. v. REYNOLDS.
    (No. 20-2614.)
    (Commission of Appeals of Texas, Section B.
    Jan. 15, 1919.)
    1. Judgment <§==>104 — Default—Withdrawal after Appearance.
    In suit on vendor’s lien note and for foreclosure, tried before a special judge in absence of district judge, wherein defendants, after the overruling of their objections to election of special judge, withdrew from the courtroom with their counsel, a judgment against them by the special judge, treating their withdrawal as an abandonment of their defense, after hearing evidence and trying the case, would be treated as a judgment on trial, and not as a judgment by default.
    2. Executors and Administrators <§=>158— Order oe Court — “Any Property” — “Sale,”
    Under Rev. St. 1911, art. 3480, forbidding the sale of any property of an estate by an administrator without an order of court, the term “any property” includes notes as well as all other kinds of property, and a valid assignment of a note is a “sale” of it passing the title to assignee.
    [Ed. Note. — For other definitions, see Words and Phrases, First and Second Series, Any; Sale.]
    3. Evidence <§=>80(1) — Statute Law oe Other State — Presumption as to Similarity.
    Without proof to the contrary, %it will be presumed that the laws of Kentucky are the same as the laws of Texas (Rev. St. 1911, art. 3480), forbidding sale of any property of an estate without an order of the court authorizing a sale by executor or administrator.
    4. Bills and Notes <§=>496(1) — Sale by Executor or Administrator — Order op Court — Burden of Proof.
    In action upon vendor’s lien note, where plaintiff’s pleadings showed that it had been the property of an estate of which an administrator was appointed in Kentucky and been placed with a bank under an escrow agreement between one of the owners and the administrator, the burden was on plaintiff to show an order of court under Rev. St. 1911, art. 3480, authorizing a sale or assignment by administrator to him.

      5. Evidences <§=568(1) — Trial <§=» 105(3) — Order of Court — Weight op Opinion Evidence.
    In suit on vendor’s lien note which had been property of an estate, plaintiff’s burden of showing, as a condition to his right of action, an order of court under Rev. St. 1911, art. 8480, authorizing foreign administrator’s sale or assignment thereof to him, was not sustained by his mere statement that he was the owner of the note, which w^s a bare conclusion or opinion, without basis of fact, and, though not objected to, it had no probative force,
    6. Bills and Notes <®=485 — Genuineness op Indorsement — Denial under Oath — Statute.
    Rev. St. 1911, art. 588, and article 1906, subd. 9, requiring a denial under oath of genuineness of indorsement or assignment of note, were not intended to dispense with proof of an administrator’s authority to sell or assign, as such authority, under article 3480, depends upon an order of court, so that absence of any verified denial of administrator’s assignment thereof to plaintiff did not dispense with proof of its validity.
    7. Bills and Notes <§=488 — Genuineness of Written Instrument — Production — Pleading.
    The absence of a sworn pleading questioning genuineness of a written instrument does not dispense with its production in court; and, where a written instrument is declared on and-there is a general denial, it is necessary to establish plaintiff’s case for him to offer the instrument in evidence.
    8. Bills and Notes <§=524 — Ownership — Production op Note — Presumption.
    The rule that plaintiff’s possession or production in court of a note sued on is prima facie evidence of ownership has no application, where the pleadings and evidence showed that he was not in possession of a note sued on, but that it was held in escrow, and that its production was procured by an order requiring it to be brought into court.
    9. Bills and Notes <§=467(2) — Action—Title op Plaintiff — Petition—“Transferred.”
    Petition in action on vendor’s lien note, alleging the appointment of vendor’s foreign administrator who transferred all notes to one S., and that note in suit was put in escrow by administrator and another did not allege title under S. or any ownership by S., and the word “transferred” meant the written indorsement thereon, and not a legal assignment and delivery, or that the transfer to S. postdated the escrow agreement.
    [Ed. Note. — For other definitions, see Words and Phrases, Second Series, Transferred.]
    Error to Court of Civil Appeals of Second Supreme Judicial District.
    Action by B. F. Reynolds against S. Webb and others. From a judgment of the Court of Civil Appeals, Second District (160 S. W. 152), affirming the trial court’s judgment for plaintiff on appeal by defendants Webb and Hill, they bring error.
    Reversed, and cause remanded to district court for new trial.
    A. A. Claris and J. A. King, both of Albany, and R. L. Allen, of Waco, for plaintiffs in error.
    B. F. Thorp, of Throckmorton, and I. W. Stephens, of Ft. Worth, for defendant in error.
   McCLENDON, j.

B. F. Reynolds, claiming to be the owner by assignment from the administrator of Laura G. H. Torrence of note No. 2 of a series of four promissory vendor’s lien notes, brought suit to recover the amount of note No. 2 and for foreclosure against S. Webb and L. H. Hill, makers, W. H. Stephens, owner of the other three notes of the series, the First National Bank of Albany, depository of note No. 2, under an escrow agreement between the administrator and Hill, one of the makers, and others, alleged to claim some interest in the land. The defendants last referred to were dismissed from the suit. Plaintiff recovered judgment against all remaining defendants. Webb and Hill alone appealed, and the Court of Civil Appeals (Second District), by a divided court, affirmed the judgment of the trial court. 160 S. W. 152.

W e have concluded that the evidence is not sufficient to show ownership of note No. 2 in the plaintiff, and that, on that account, the cause should be remanded to the trial court for a new trial. We shall therefore only state such matters of pleading and evidence as seem to us essential to render intelligible our decision in this regard. For a further statement of the case we refer to the opinion of the Court of Civil Appeals.

The regular district judge was disqualified, and at various times other judges had made orders in the case. The trial was had before a special judge, elected by the bar in the absence of the judge of the district. The defendants made objection to this election, and upon being overruled in these objections withdrew, with their counsel, from the courtroom, in the belief that the election was void, and that further participation by them in the proceedings would effect a waiver of their objections. Thereupon the judge entered a judgment by default against the bank, requiring it to produce in court note No. 2 and, as to the other defendants, proceeded to try the case, rendering judgment for the plaintiff as prayed for.

There is a statement of facts approved by the judge which is signed by counsel for plaintiff and defendants. Webb and Hill filed motion for new trial urging, among other grounds, that there was no competent evidence showing that the plaintiff was the owner of the note and entitled to maintain the suit. "When the defendants declined to recognize his authority and withdrew from the courtroom the judge treated this action as an abandonment of their defense, but, instead of entering judgment by default against them proceeded to hear evidence and try the case. We have reached the conclusion that under all the circumstances apparent from the record this judgment must be treated as a judgment on trial, and not as a judgment by default. The record shows that the defendants, Webb and Hill, were in court with answers filed and by attorneys right up to the time of trial of the case, and that they withdrew from the courtroom upon the belief that the election of the special judge was void, and that further participation by them in the proceedings would be a waiver of their rights. That the court was advised- of the existence of their pleadings is evident from the record. We think, therefore, that this case is distinguishable from those in which judgment by default is entered after the filing of answer, where the fact of the existence of such answer is not brought to the attention of the court, and that it comes within the rule announced in Tally v. Thorn, 35 Tex. 727. In that case, which was a suit in trespass to try title, it was held that, the judgment itself showing that the defendant had on file an answer which was called to the attention of the court, it was error to render judgment by default and it was necessary, in order to maintain the judgment, for the plaintiff to prove his title. In the present case, whether the defendants were correct or not in withdrawing from the courtroom, we do not think that such withdrawal, under the circumstances, amounted to an abandonment of their pleadings. The right of plaintiff to bring the suit was raised by special exception, and immediately after the trial was again urged in a motion for new trial.

Plaintiff’s first amended petition, upon which he went to trial, alleges: The conveyance of the land by Laura Torrence to Webb and Hill; the execution of the four vendor’s lien notes; the death of Laura Tor-rence in Kentucky, where she had lived; the appointment of A. C. Hensley of Woodford, Ky., as administrator of her estate; “that all of said notes were transferred to the defendant W. H. Stephens by A. O. Hensley, administrator aforesaid, and that said defendant W. H. Stephens paid in full notes Nos. 1, 3, and 4 of said series, and the said defendant Stephens is now the legal owner and holder of said notes, Nos. 1, 3, and 4 of said series;” that note No. 2 was by agreement between the administrator and Webb deposited with the defendant bank in trust to be held until a claimed shortage in the land was determined, which agreement was also deposited with the bank. The agreement between Hill and the administrator was copied in full in the petition.

The petition further alleges certain facts as constituting a breach of this agreement on the part of Hill, and that the administrator had sold and conveyed to plaintiff, for a valuable consideration, said note No. 2s also all of the rights, choses in action, liens, and all other rights that said estate of Laura G-. H. Torrence had in said note No. 2. It is further alleged that plaintiff acted as agent for the administrator in making the contract.

The answer of Webb and Hill, among other things, contains a* special exception to the petition on the ground that it showed that plaintiff was not the owner of or entitled to sue on the note, and a general denial. The other matters in the answer are not pertinent to our disposition of the case.

Article 3480, Rev. St. 1911, provides:

“No sale of any pi-operty belonging to an estate shall be made by an executor or administrator without an order of the court authorizing the sale.”

In Browne v. Fidelity & Deposit Co., 98 Tex. 55, 80 S. W. 593, it was held that the term “any property” in this statute embraces promissory notes as well as all other kinds of property, and that an assignment of a note is a sale of it which passes the title to the assignee if lawfully made. It is clear, therefore, that, in order to establish ownership in the plaintiff there must háve been a valid order of court, authorizing the administrator to sell the note. In the absence of proof to the contrary, it will be presumed that the laws of Kentucky in this regard are the same as the laws of Texas.

The only evidence in the statement of facts upon this matter is the testimony of plaintiff in the following language: “I am the owner of the note sued on.” In view of plaintiff’s own pleading, which, affirmatively shows that the note was the property of the estate; that the administrator was appointed in Kentucky; that the note at the time of the trial was in possession of the bank under an escrow agreement between one of the owners and the administrator — it appears that in order to constitute plaintiff the owner of the note there must have been an order of the probate court, authorizing the sale or assignment by the administrator to him. The burden of proof was on the plaintiff to establish his right to sue; and, where his own pleadings show that that right was dependent on an order of court, we think it incumbent upon him to show by some competent testimony that such order was made. This burden was in no sense met by a mere statement of plaintiff that he was the owner of the note. Under the circumstances, such a statement was a bare conclusion or opinion of the witness without any basis of fact to show upon what the conclusion rested. The fact that it was not objected to could add nothing to its pro- , bative force. As was said in Henry v. Phillips, 105 Tex. 459, 151 S. W. 533:

“Incompetent testimony can never form the basis of a finding of facts in an appellate court, notwithstanding its presence in the record without objection. When the appellate court comes to apply the law to testimony constituting the facts of the case, it can only base its conclusion upon such testimony as is under the law competent. That which is not competent testimony should be given no probative force. The admission of such testimony is no talisman to give effect to that which is irrelevant and incompetent to sustain or deny a material issue in a case.”

“In proving title, facts and circumstances must be shown that establish it. It cannot be established by the conclusion of a witness.” Cullers v. Gray (Civ. App.) 57 S. W. 305.

In Gilbert v. Odum, 69 Tex. 673, 7 S. W. 510, it is held that title or want of title is a conclusion that the law draws from a given state of facts, and that it cannot be proved by the testimony of a party that he did or did not own any interest in the property.

We are aware that there are circumstances under which it is not improper to prove ownership of either real or personal property by testimony that a party is the owner thereof; and that, with regard to personal property, the rule generally is not so strict as regards real estate. But where the question of ownership is one- of the vital issues in a case, and where, as in the present case, ownership depends upon an order of court, the testimony of a party that he is the owner of the property amounts to nothing more than a bare opinion or conclusion of the witness, and has no probative force whatever. Plaintiff could as readily have established his ■case by testifying that he was entitled to judgment.

It is contended that, under our statutes requiring certain pleadings to be sworn to; there being no verified pleading denying validity of the assignment to plaintiff, proof thereof was dispensed with. The statutes relating to this matter are Rev. St. 1911, arts. 588, 1906, subds. 8, 9, and article 3710, which for convenience are copied in an appendix below.

Subdivision 8 of article 1906 and article 3710, have no application to this case. Those articles relate to an instrument, note, assignment, or indorsement alleged to have been executed by a party to the suit or by his authority. The assignment relied upon by plaintiff was alleged to have been executed by the administrator who was not a party to the suit.

Article 588 and subdivision 9 of article 1906 require denial under oath of the genuineness of an indorsement or assignment of a note. It has been held under these statutes that it is necessary to deny under oath the genuineness of an indorsement or assignment by an agent in order to put in issue the question of the agent’s authority, but we have not been cited to any case in Texas which holds that, in order to question the authority of an administrator, executor, or guardian to indorse or assign a note, such authority or genuineness of the indorsement must be denied under oath.

We do not believe that it was the purpose or intention of these statutes to dispense with proof of the authority of the administrator where such authority under our statutes, necessarily depends for any validity upon an order of court. But, in any event, it would be necessary, in our opinion, for the plaintiff to produce in evidence the assignment or in-dorsement of the administrator or account for its absence. This was not done. It has been repeatedly held in this state that the absence of a sworn pleading, questioning the genuineness of a written instrument, does' not dispense with the production of the instrument in court; and where a written instrument is declared on in a petition, and there is a general denial, it is necessary, in order to establish plaintiff’s case, for him to offer the instrument in evidence. Pope v. American Surety Co., 42 Tex. Civ. App. 152, 93 S. W. 480, and authorities there cited.

It is further contended that ownership in plaintiff would be prima facie presumed by his production of the note. The cases holding that possession and production in court by plaintiff of a note sued on is prima -facie evidence of ownership have no application to the facts in this, case. The pleadings and evidence show that plaintiff was not in possession of the note, but that it was held by the bank in escrow, and that its production in court was procured by an order requiring the bank to bring it into court. No presumption of ownership in the plaintiff could arise from this state of facts.

It is said by the majority of the Court of Civil Appeals:

“Nor was there any verified plea by appellant questioning the validity of the indorsement * * * to W. H. Stephens by the administrator, although such assignment of the note to Stephens and transfer from Stephens to plaintiff was alleged in the petition, in addition to another allegation that plaintiff acquired the note from the administrator.”

That court draws therefrom the conclusion that Stephens, being a party to the suit and not having appealed, the appellants cannot complain of a lack of evidence that the title acquired by Stephens from the administrator was duly transferred to plaintiff.

We have carefully perused the petition upon which plaintiff went to trial, and fail to discover any allegation to the effect that plaintiff claimed title to the note under Stephens. Nor do we construe plaintiff’s pleadings as alleging any ownership in Stephens of note No. 2. True, it is alleged, as above quoted, that the administrator assigned all the four notes to Stephens. But it is further distinctly alleged, both in the body of the peti tion and in the escrow agreement copied in full therein, that note No. 2 was placed in escrow by the administrator and Hill, who alone were parties to the escrow agreement; that plaintiff acted as the agent of the administrator in making the agreement; and that thereafter the administrator had made every effort to comply with the agreement. We must therefore conclude, either that the word “transferred” as applied to note No. 2, was used in the sense of the physical act of placing the written indorsement on the back of the note, as distinguished from a legal assignment including delivery, or that the transfer to Stephens pohtdated the escrow agreement. In the latter event Stephens’ title would depend upon a valid order of court, of the existence of which the record is silent. Why and at what date the indorsement of the note to Stephens was placed thereon are matters only of conjecture; but in any event, there is no competent evidence which would warrant a finding of ownership in plaintiff through Stephens.

We conclude that the judgment of the Court of Civil Appeals should be reversed, and the cause remanded to the District Court for a new trial, defendant in error to pay all costs of appeal.

PHILLIPS, C. J.

The judgment recommended by the Commission of Appeals is adopted and will be entered as the judgment of the Supreme Court. The case is correctly remanded upon the ground stated by the Commission in its opinion.

Appendix.

Art. 588. When a suit shall be instituted by an assignee or indorsee of any written instrument, the assignment or indorsement thereof shall be regarded as fully proved, unless the defendant shall deny in his plea that the same is genuine, and moreover shall file, with the papers in the cause, an affidavit stating that he has good cause to believe, and verily does believe, that such assignment or indorsement is forged.

Art. 1906. An answer setting up any of the following matters, unless the truth of the pleadings appear of record, shall be verified by affidavit:

8. A denial of the execution by himself or by his authority of any instrument in writing, upon which any pleading is founded, in whole or in part, and charged to have been executed by him or by his authority, and not alleged to be lost or destroyed. Where such instrument & writing is charged to have been executed by a person then deceased, the affidavit will be sufficient if it state that the affiant has reason ■to believe and does believe that such instrument was not executed by the decedent or by his authority.

9. A plea denying the genuineness of the in-dorsement or assignment of a written instrument, as required by article 588.

Art. 3710. When any petition, answer, or other pleading shall be founded, in whole or in part, on any instrument or note in writing, charged to have been executed by the other party or by his authority, and not alleged therein to be lost or destroyed, such instrument or' note in writing shall be received as evidence without the necessity of proving its execution, unless the party by whom or by whose authority such instrument or note in writing is charged to have been executed, shall -file his affidavit in writing denying the execution thereof; and the like rule shall prevail in all suits against indorsers and sureties upon any note or instrument in writing. When any such instrument or note in writing is charged to have been executed by any testator or intestate, it shall be received in evidence in like manner, unless some suspicion is cast upon it by the affidavit of the executor or administrator of such testator or intestate.
      <§=3For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

      <fe»For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: SADLER, J. PHILLIPS, C. J.

text:
    TEXAS & P. RY. CO. v. WEST BROS. et al. WEST BROS. et al. v. ST. LOUIS, I. M. & S. RY. CO.
    (No. 21-2636.)
    (Commission of Appeals of Texas, Section B.
    Jan. 15, 1919.)
    1. Carriers @=32(2) — Interstate Commerce— Contracts — V aridity .
    Contract for interstate shipment of cattle over certain lines within certain period, so as to require but one feeding and watering cn route, and so as to arrive on a specified day, held void as discriminating between shippers in contravention of U. S. Comp. St. §§ 8597, 8604a, 8604aa.
    2. Appeal and Error @=1090(2) — Review —Intermediate Courts — Failure to Appeal.
    Where shipper sued initial, connecting, and terminal carrier, and judgment went for plaintiff as against terminal .carrier on theory of verbal contract made with it, and shipper did not appeal or assign cross-assignments in Court of Civil Appeals, though terminal carrier appealed, on further appeal by shipper from adverse judgment to ’Supreme Court shipper would be held to have abandoned his cause of action against the other defendant.
    3. Carriers @=>219(5) — Damage to Cattle —Connecting Carriers.
    Shipper of cattle damaged in interstate shipment could recover either the entire loss from the initial carrier or in separate actions against each carrier for the damages severally chargeable to each road, in view of U. S. Comp. St. § 8604a.
    4. Carriers @=229(4) — Live Stock — Connecting Carriers — Damage—Recoupment.
    Where cattle wei'e shipped over connecting interstate lines, if shipper recovered from initial carrier for the whole loss, it could recoup against each company handling the shipment for any damages caused by it, in view of U. S. Comp. St. § 8604aa.

      5. Appeal and Error <S=>1212(2) — Remand —Issues on Retrial.
    Where shipper sued initial, connecting, and terminal carriers for injuries to shipment of live stock, hut all causes of action were abandoned except as against' terminal carrier and judgment went for plaintiff on theory of verbal contract with terminal carrier, though acts of negligence were also alleged, on reversal and remand for invalidity of contract shipper could recover on another trial on theory of negligence.
    6. Carriers <©=>229(4) — Injuries to Live Stock — Connecting Carriers — Recovery Over.
    Under Carmack Amendment to Hepburn Act (U. S. Comp.. St. §§ 8604a, 8604aa), a terminal carrier alone sued for its negligence in transporting cattle received from connecting carrier could have no recovery over for any damages found against it.
    7. Appeal and Error <©=>1173(1) — Disposition — Pinal Judgment — Parties.
    Where shipper of cattle suing initial, connecting, and terminal carriers elected to recover from terminal carrier, which sought judgment over against connecting carriers, but under the Carmack Amendment to the Hepburn Act (U. 'S. Comp. St. §§ 8604a, 8604aa) and under the pleadings and evidence the terminal carrier could not have recovery over, it was not necessary to remand the cause as to connecting carrier on reversal of judgment for plaintiff against terminal carrier.
    8. Carriers <©=>211 — “Pill” — Shippers oe Live Stock.
    The term “fill," used in relation to shipments of live stock, means feeding and watering stock just prior to sale so as to increase their weight and thus enhance their value.
    [Ed. Note. — Por other definitions, see Words and Phrases, Pirst and Second Series, Pill.]
    9. Carriers <©=>229(1) — Damage to Stock-Evidence.
    In action for damages to stock shipped in interstate commerce, it is proper to plead and show anything which in reasonable contemplation of shipper, buyer, and carrier may affect the market value of the stock in determining whether there is loss.
    Error to Court of Civil. Appeals of Fourth Supreme Judicial District.
    Action by West Bros, and others against the Texas & Pacific Railway Company and the St. Louis, Iron Mountain & Southern Railway Company and others. There was a judgment on verdict for plaintiffs against the St. Louis road and for the other defendants, both as to plaintiffs and the cross-actions of the St. Louis road against the other defendants, which was affirmed in the Court of Civil Appeals (159 S. W. 142) in so far as favorable to the defendants other than the St. Louis and the Texas & Pacific Companies, as to which it was reversed and remanded, and, to review such judgment, West Brothers and the Texas & Pacific Company bring error.
    Judgment affirmed in part, and in part reversed and rendered in accordance with the recommendation of the Commission of Appeals.
    W. L. Hall, of. Dallas, and W. B. Tea-garden, of San Antonio, for Texas & P. Ry. Co.
    Guinn & McNeill, of San Antonio, for St. Louis, I. M. & S. Ry. Co.
    Martin & Martin and L. Old, both of Uvalde, and L. E. Lanier, of Jasper, for West Bros: and others.
   SADLER, J.

Writ of error was granted on the petition of the Texas & Pacific Railway Company under the view that the judgment of the district court as to it should have been affirmed. The petition of West Bros, was granted as a matter of course. The whole case is before us for consideration.

In the district court of Uvalde county, West Bros, sued the Galveston, Harrisburg & San Antonio, International & Great Northern, Texas & Pacific, St. Louis, Iron Mountain & Southern Railway Companies, and T. J. Freeman, as receiver of the International & Great Northern Railway Company, for damages to thirteen cars of cattle shipped from Uvalde, Tex., on June 5, 1911, to consignees at the National Stockyards, East St. Louis, Ill.

A jury trial resulted in a verdict and judgment for plaintiffs West Bros., against the St. Louis, Iron Mountain & Southern Railway Company and favorable to the other defendants, both as to the plaintiffs and the cross-actions of the Iron Mountain Company.

On appeal to the Court of Civil Appeals by the Iron Mountain Company, the judgment was affirmed in so far as it was favorable to the G., H. & S. A. and I. & G. N. Railway Companies, and T. J. Freeman as receiver. It was reversed and remanded as to the St. Louis, Iron Mountain & Southern and the Texas & Pacific Railway Companies. 159 S. W. 146.

The plaintiffs sought mainly to recover upon a verbal contract with the agent of the St. Louis, Iron Mountain & Southern Railway Company for the transportation of their cattle from Uvalde to the National Stockyards, East St. Louis, Ill. They alleged that the Iron Mountain Company contracted to accept the cattle for shipment at Uvalde on Saturday and to deliver them at the National Stockyards on the following Tuesday in time for that day’s market, and that they would be transported so that they would require only one stoppage in transit for food and water. Charged the other defendants as parties to the verbal contract. Various acts of negligence on the part of each carrier were alleged. It was charged that the cattle were not delivered on the date contracted, but were delivered on Wednesday, and that they were stopped twice in transit for food and water. In addition to damages for decline in market value, there were other items of damage alleged, including the loss of an extra “fill,” which the cattle would have taken' had they only been stopped one time in transit for food' and water. They prayed for judgment against the Iron Mountain Company for the full amount of the damage and alternately for their damage occasioned by each carrier.

By an alternative plea, plaintiff set up a written contract of shipment by the Galveston, Harrisburg & San Antonio Railway Company for the transportation of the cattle, charging the other defendants as parties to the written contract, pleaded fully the acts of negligence on the part of each carrier in the shipment, the breach of the contract, and the damages as same were pleaded under the verbal contract. They prayed for recovery of the entire damage against the G., H. & S. A. Railway Company as the initial carrier and. in the alternative for damages occasioned by each defendant.

The Iron Mountain Company answered by various exceptions, general denial, and special pleas denying the verbal contract, denying the authority ,of its agent to make the verbal contract, alleging that, if the contract were made by its agent, it was void, and then sought by cross-actions to recover from each of its codefendants the damages occurring on each of its codefendants’ roads in the event judgment should be rendered against it for plaintiffs’ entire damage.

The G., H. & S. A. Railway Company answered, in addition to exceptions and general denial, by pleas denying the authority of the Iron Mountain Company or its agent to bind it by the verbal contract of shipment, and alleged that, if it were made, it was void, it sought by cross-action to recover against each of its codefendants the damage occasioned on the road of each in the event judgment should be rendered against it for the whole damage. Each of the defendants set up written contracts covering the shipment and set up the different clauses in the contracts limiting liability to its own line.

Under the disposition which will be made of the case, it is not necessary to recur to the pleadings of the International & Great Northern and the receiver.

The T. & P. Ry. Company, in addition to demurrers and general denial, denied the authority of the Iron Mountain or its agent to bind it by the verbal contract, and alleged that the verbal contract was void and nonenforceable. It also pleaded a written contract with it for the shipment over its line and the limitation of its liability to the damages occurring thereon.

The court, after the evidence was in, at the request of the plaintiffs, instructed a verdict for the G., H. & S. A., the I. & G. N., and the receiver. In his general charge to the jury, he submitted the cause solely under the verbal contract and practically gave a peremptory instruction in favor of the T. & P. Company.

The Iron' Mountain Company alone appealed, assigning, among other errors committed on the trial, the error in rendering judgment against it on the verbal contract, asserting that contract to be void. It also complained of the charge of the court in disposing of its codefendants. No motion for new trial or cross-assignments were made by the plaintiffs.

The Court of Civil Appeals, among other things, held that the verbal .contract was void. It also denied the right of plaintiffs to recover for the extra “fill” set up under the verbal contract.

The T. & P. Railway Company assigns error in the judgment of the honorable Court of Civil Appeals in remanding the cause as to it. West Bros, complain of the judgment in reversing and remanding the cause as to the Iron Mountain Railway Company,

Opinion.

We are of the.opinion that, even though the Court of Civil Appeals may not have been entirely correct in the disposition made-by it of the complaint urged by plaintiffs to the brief of the Iron Mountain Railway Company, yet that there are errors apparent on the record and sufficiently presented by the brief to authorize the reversal of the cause by the Court of Civil Appeals as to the Iron Mountain Railway Company.

We are of the opinion that the verbal contract alleged by the plaintiffs and submitted by the court is in contravention óf law, is void, and will not support plaintiff’s suit. U. S. Compiled Statutes 1918, § 8597, p. 1370; sections 8604a, 8604aa, p. 1373; Chicago & Alton Railway Co. v. Kirby, 225 U. S. 155, 32 Sup. Ct. 648, 56 L. Ed. 1033, Ann. Cas. 1914A, 501.

The plaintiffs having made no complaint with reference to the submission of the cause by the court and' the judgment as to the Texas & Pacific Railway Company, it only remains to determine whether the judgment should be affirmed as to the T. & P. Railway Company or remanded in order that the issues between it and the Iron Mountain Company may be adjudicated.

We are of the opinion that, under the state of the record, plaintiffs have abandoned their cause of action against all of the defendants except the Iron Mountain Railway Company. So far, therefore, as the plaintiffs are concerned, the judgment of the district court as to said defendants is final, conclusive, and should be affirmed.

The Iron Mountain Company in the court below, as well as in the Court of Civil Appeals, did complain of the charge of the court in instructing a verdict in favor of its co-defendant railway companies. •

In determining whether or not the Court of Civil Appeals erred in remanding the cause as to the Texas & Pacific Railway Company, it becomes necessary to determine whether plaintiffs’ cause of action against these companies was severable and distinct as to each company.

Under the pleadings setting up the written contract made by the G., H. & S. A. Railway Company and under the pleadings of each defendant railway company, it is apparent from the record that whatever cause of action plaintiffs had for damage could have been maintained against the G., H. & S. A. Railway Company as the initial carrier, and they might have recovered from it the whole damage caused by one or all of the carriers engaged in transporting the live stock. Plaintiffs, however, may have recovered in separate causes of action against each carrier for the damages chargeable to its road without reference to their rights against the other carriers. The initial carrier, in the event of judgment against it for the whole damage, had a right to recoup against each company handling the shipment for the damages caused by each codefend-ant.

The liability, by reason of the transportation of the freight under the shipping contract issued by the initial carrier by reason of the statutory provisions governing interstate shipments, gave to the plaintiffs the right of recovery against it fot the whole damage occasioned by the breach of the initial contract by any, or all,. of the carriers. The same statute authorizes the initial carrier to recover against each of its cocarriers that portion of the damage chargeable to such cocarrier. '

Plaintiffs, having elected to stand on the verbal contract, abandoned the claim under the written contract, by requesting instructed verdicts on behalf of the initial carrier and of the I. & G. N. Railway Company and its receiver. They are precluded from recovery by the judgment rendered as to such carriers. However, they are not precluded on another trial on proper pleadings from a recovery against the Iron Mountain Company for such damages as may have been occasioned by the negligence on the part of the carrier in the transportation and delivery of the freight. M., K. & T. Ry. Co. v. Ward, 244 U. S. 385, 37 Sup. Ct. 617, 61 L. Ed. 1213; Id., 169 S. W. 1035; Adams Express Co. v. Croninger, 226 U. S. 491, 33 Sup. Ct. 148, 57 L. Ed. 314, 44 L. R. A. (N. S.) 257; Kansas City Southern Ry. Co. v. Carl, 227 U. S. 639, 33 Sup. Ct. 391, 57 L. Ed. 683; Id., 91 Ark. 97, 121 S. W. 932, 134 Am. St. Rep. 56.

Under the interpretation by the Supreme Court of this state and the Supreme Court of the United States of the Carmack Amendment to the Hepburn Act, and under the pleadings and evidence in this case, viewed in the light of these decisions, no cause of action existed in favor of the Iron Mountain Railway Company against its co-defendant the Texas & Pacific Railway Company. The fact that it sought a judgment over against the Texas & Pacific Company does not necessitate that the cause be remanded as to that company, since under the evidence and pleading and under the law applicable to this case in no event could the Iron Mountain recover from the T. & P. Railway Company.

On another trial of the case, the Iron Mountain Company cannot be held liable for damages which occurred on the lines of and are chargeable to its codefendant railway companies, and in no event can the plaintiffs recover against it for any damage, except that which was occasioned by it. Therefore there could be no cause of action arising in favor of the Iron Mountain Company against the Texas & Pacific Railway Company.

We are of the opinion that the defendant in error the Iron Mountain Company cannot complain of an affirmance as to the T. & P. Railway Company.

Again, since the plaintiffs make no complaint as to the judgment rendered releasing the - Texas & Pacific Railway Company and have assigned no error to the action of the court below in the rendition of that judgment, and since, under the facts in this case, no cause of action could exist in favor of the Iron Mountain Company against the Texas & Pacific Railway Company, we are of the opinion that the judgment of the district court in favor of the Texas & Pacific Railway Company against the plaintiffs is final, and that no error is shown in the judgment of which the Iron Mountain Company can complain.

Such being our conclusion, it follows that no useful purpose can be served in remanding the cause as to the Texas & Pacific Railway Company, and under the holding of the Supreme Court in Texas Central Railway Co. v. Moore, 103 Tex. 349, 127 S. W. 797, the-judgment of the district court disposing of the T. & P. Railway Company should be affirmed.

The West Bros, assert that the Court of Civil Appeals erred in denying them the right to recover for the extra “fill” pleaded by them.

We do not understand the opinion of the Court of Civil Appeals to go to the extent which they assert. We gather from that opinion that it is simply holding against the proposition that plaintiffs can recover in this action the damages by reason of the failure of their cattle to take on the extra “fill,” which is alleged to have resulted from a breach of the verbal contract.

We do not understand that opinion to deny plaintiffs tlie benefits which may be claimed by reason of loss of “fill.”

The record shows that the shippers and the buyers understand the custom prevailing among cattlemen of feeding and watering cattle just before they are offered for sale, this being commonly denominated in cowmen’s parlance “fill.” There is no fraud in this, since it is permissible and understood by the “trade.” We surmise that the buyer takes this fill into consideration in fixing the price which he offers for the cattle. The want of “fill” may detract from the appearance of the cattle and affect the market price. It will also cause a loss in value by reason of the “falling off” in weight.

The shipper is entitled to the benefit of the “fill,” as it may affect the value of his- cattle. It is proper to plead and show anything which in reasonable contemplation of shipper, buyer, and carrier may affect the market value of the stock in determining whether there is loss dr not.

Plaintiffs were perhaps more frank in their pleadings than is usual, but this should not deprive them of recovery for such damages as may have been caused by depreciation in value resulting from fault of the carrier. The loss of proper or contemplated “fill” may affect both “market price and weight,” and thus affect “market value.”

The other questions presented in the record are believed to have been correctly disposed of by the Court of Civil Appeals, and we are of the opinion that its judgment reversing and remanding as to the St. Louis, Iron Mountain & Southern Railway Company should be affirmed, but that its judgment as to the T. & P. Railway Company should be reversed, and judgment here rendered affirming the judgment of the lower court.

PHILLIPS, C. J.

The judgment recommended by the Commission of Appeals is adopted and will be entered as the judgment of the Supreme Court.
      <&^>For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

      @=>For other eases see same topic and KEY-NUMBER in ail Key-Numbered Digests and Indexes