American Sav. and Loan Ass'n of Houston v. Musick

• Decision Date: 17 December 1975
• Docket Number: No. B--5081,B--5081
• Citation: 531 S.W.2d 581
• Parties: AMERICAN SAVINGS AND LOAN ASSOCIATION OF HOUSTON, Petitioner, v. Mary Ann MUSICK et al., Respondents.
• Court: Texas Supreme Court

Page 581

531 S.W.2d 581

AMERICAN SAVINGS AND LOAN ASSOCIATION OF HOUSTON, Petitioner, v. Mary Ann MUSICK et al., Respondents.

No. B--5081.

Supreme Court of Texas.

Dec. 17, 1975.

Rehearing Denied Jan. 21, 1976.

Lee, Brown & Wylie, Charles B. Wolfe, Anderson, Brown, Orn & Jones, Nelson Jones, Houston, for petitioner.

Cox, Pakenham & Roady, Joe G. Roady, Houston, for respondents.

SAM D. JOHNSON, Justice.

This is a trespass to try title case involving three tracts of land and turning on the construction and validity of three legal instruments: (1) a deed to the mortgagor; (2) a deed of trust; and (3) trustee's deed conveying the three tracts of land to the mortgagee. American Savings and Loan Association of Houston, the mortgagee, brought this action against several claimants, including the mortgagors (Meyer Jacobson and T. S. Kent), and the parties through whom the mortgagors claimed title (TWI Development Company and Mary Ann Musick, individually and as administratrix of the estate of her husband, Levoy Musick, deceased). The trial court instructed a verdict awarding one tract, 618.7 acres, to American Savings, one tract, 41.4305 acres, to Mary Ann Musick, individually and as administratrix of the estate of Levoy Musick, deceased, and one tract, 16.6 acres, to TWI Development Company. The Houston Court of Civil Appeals (14th Dist.) affirmed the trial court's award of the two smaller tracts but reversed the judgment as to the 618.7-acre tract and remanded that portion of the case. 517 S.W.2d 627. We reverse the judgment of the court of civil appeals and affirm that of the trial court.

Prior to the transactions from which this controversy arose, the 41.4305-acre tract was owned by Levoy Musick in his own name and the other two tracts were owned by TWI Development Company, a corporation solely owned by Levoy Musick. In June 1964 Musick and TWI conveyed the three tracts to Harry Holmes, Jr. and W. M. Wheless, Sr., reserving options to repurchase their respective tracts. Four months after the conveyance to Holmes and Wheless, Levoy Musick died and under the terms of his will his wife, Mary Ann Musick, became the owner of the TWI stock as well as the repurchase options. The will named Meyer Jacobson, an attorney, as independent executor. During the course of this litigation Jacobson resigned as independent executor and Mary Ann Musick was appointed administratrix with will annexed.

Upon advice from Jacobson and T. S. Kent, and old friend and business associate of her husband, Mary Ann Musick agreed to a plan for exercising her repurchase options. The plan called for her to convey some of the land in question to Kent and Jacobson so that they could use it as collateral in securing the funds necessary to exercise the options. In accordance with the plan, on December 18, 1964 the following three conveyances were made.

1. TWI and Mary Ann Musick exercised their respective options, and Holmes and Wheless thereupon executed warranty deeds conveying the 41.4305-acre tract to Mrs. Musick and the other two tracts to TWI.

2. Mary Ann Musick, as president of TWI conveyed to Kent and Jacobson, by a general warranty deed, property described therein as follows:

'618.7 acres of land, more or less, out of the WILLIAM WHITE SURVEY, Abstract No. 829, Harris County, Texas, More particularly described by metes and bounds in deed of trust of even date herewith from T. S. Kent and Meyer Jacobson to Ralph B. Lee, Trustee, recorded in the office of the County Clerk of Harris County, Texas.' (Emphasis added.)

3. Kent and Jacobson executed a deed of trust to Ralph B. Lee as trustee for the benefit of American Savings. The deed of trust purported to convey the three tracts of land in question, labeled as Tract A, 618.7 acres; Tract B, 41.4305 acres; and Tract C. 16.6 acres. Metes and bounds descriptions were provided for each tract.

The deed of trust secured a loan of $150,000 from American Savings to Kent and Jacobson. No payments were ever made on the promissory note executed by Kent and Jacobson and it fell into default. On February 1, 1966 the property was sold at a trustee's sale to American Savings for $25,000, and a trustee's deed to American Savings was executed.

American Savings originally brought this action against TWI, Mary Ann Musick, Kent, Jacobson, and several other parties who were involved in a dispute within the Musick family as to the ownership of the land. TWI and Mary Ann Musick filed a cross action against American Savings, Kent, Jacobson, and Elliott & Waldron Title & Guaranty Company claiming title to the three tracts of land and seeking to set aside the deed to Kent and Jacobson, the deed of trust, and the trustee's deed to American Savings. Subsequently, the cross action against Elliott & Waldron Title & Guaranty Company was nonsuited and the dispute among the remaining parties to the cross action was severed from the claims and issues among the members of the Musick family. American Savings, TWI, and Mary Ann Musick appealed from the judgment of the trial court; Kent and Jacobson did not appeal.

We will consider, first, what, if any, property passed under the warranty deed to Kent and Jacobson and the deed of trust from Kent and Jacobson to Ralph B. Lee. Next, we will determine the validity of the trustee's sale and the trustee's deed to American Savings. Finally, we will consider whether election of remedies or judicial estoppel precludes judgment for American Savings.

I.

The court of civil appeals apparently concluded that the 618.7-acre tract passed under the deed to Kent and Jacobson as well as under the deed of trust of Ralph B. Lee. The court held, however, that the 41.4305- and the 16.6-acre tracts were not conveyed by the aforesaid instruments. American Savings, TWI, and Mary Ann Musick filed applications for writ of error objecting to the lower court's holding.

American Savings contends that the deed to Kent and Jacobson conveyed all three tracts described by metes and bounds in the deed of trust because the deed referred to the deed of trust for a more particular description of the land. American Savings further contends that the metes and bounds description in the deed of trust must prevail over the call for acreage in the deed to Kent and Jacobson. We conclude, however, that the lower courts correctly decided that the 41.4305- and the 16.6-acre tracts did not pass under the deed and the deed of trust; only the 618.7-acre tract was conveyed by the two instruments.

Although the deed did refer to the deed of trust for a more particular description of the land conveyed, the deed did not purport to convey All of the tracts described in the deed of trust. This is not a case where a metes and bounds description should prevail over a call for acreage, Texas Pacific Coal & Oil Company v. Masterson, 160 Tex. 548, 334 S.W.2d 436 (1960); there is no inconsistency between the call for acreage in the deed and the metes and bounds description in the deed of trust. The 618.7-acre call in the deed can be harmonized with the deed of trust because Tract A in the deed of trust contained the identical call for acreage. In Winters v. Slover, 151 Tex. 485, 251 S.W.2d 726 (1952), this court stated:

'The petitioners' contention that the specific description of the entire 165 1/2 acres tract should control over the general description which referred to the deed from T. J. Slover to Chilton expressly reserving one-half of the minerals, is answered by the well recognized rule that a general description will be disregarded where it can be harmonized with a particular description.' 251 S.W.2d 726 at 728.

Sharp v. Fowler, 151 Tex. 490, 252 S.W.2d 153 (1952), relied upon by American Savings, is not apposite. In Sharp this court summarized the property description in the deed as follows:

'Following the grant there is designated the number of acres granted and the county and survey in which the land is located. . . . But the description is made certain by the language 'being the same land described in' the Frost deed.' (Emphasis added.) 252 S.W.2d 153 at 154.

The distinction between Sharp and the instant case is that in Sharp the deed incorporated All of the land described in the deed two which reference was made. The deed to Kent and Jacobson simply referred to the deed of trust for a more particular description without incorporating All of the property described therein.

In their application TWI and Mary Ann Musick contend that American Savings failed to prove a chain of title to the 618.7-acre tract because the deed of trust and the promissory note secured thereby were materially altered and therefore void. Mary Ann Musick filed an affidavit of forgery in the trial court claiming that the deed of trust was altered after execution by addition of the 41.4305- and the 16.6-acre tracts. Furthermore, it is evident that the figure '618.7' in the note's description of the acreage provided as security was erased and retyped '676.7305.' We hold however, that the alleged alterations of the deed of trust and the promissory note did not make the instruments void because the alterations were not material. The 41.4305- and the 16.6-acre tracts did not pass under the deed to Kent and Jacobson; consequently, Kent and Jacobson could not have conveyed them under the deed of trust, nor could they have been made security for the promissory note executed by Kent and Jacobson. The inclusion of the additional tracts in the deed of trust and the promissory note had no legal effect. See Reed v. Roark, 14 Tex. 329 (1855).

II.

The court of civil appeals remanded the case for a determination whether the foreclosure sale and the trustee's deed of the 618.7-acre tract should be set aside. The court stated that fact issues were presented as to whether the price paid by American Savings was inadequate and whether certain irregularities tainted the foreclosure sale. TWI urges that we declare the trustee's deed void as a matter of law,...