Banco Minero v. Ross

• Court: Supreme Court of Texas
• Citation: 172 S.W. 711
• Docket Number: (No. 2328.)
• Parties: BANCO MINERO v. ROSS et al.
• Decision Date: 20 January 1915

Page 711

172 S.W. 711 BANCO MINERO
v.
ROSS et al. (No. 2328.) Supreme Court of Texas. January 20, 1915.

Error to Court of Civil Appeals of Fourth Supreme Judicial District.

Action by J. O. Ross and H. Masterson against the Banco Minero. Judgment for

Page 712

plaintiffs, and defendant brings error. Affirmed.

T. A. Falvey, Waters Davis, and J. M. Goggin, all of El Paso, for plaintiff in error. Beall & Kemp, of El Paso, R. H. Ward, of San Antonio, and Baker, Botts, Parker & Garwood, of Houston, for defendants in error.

PHILLIPS, J.

The source of this suit was a contract entered into on May 8, 1907, between A. H. Kraft, John Fulkerson, and Don Alberto Terrazas, on the one hand, and J. O. Ross and H. Masterson, citizens of this state, the defendants in error, on the other, for the sale to the latter by Terrazas, a citizen of the republic of Mexico, of a large body of Mexican land, comprising about 125,000 acres, and known as the Carillo grant, at the price of $1 gold per acre, $10,000 gold to be paid Terrazas by May 12th, and $40,000 gold to be deposited by Ross and Masterson to their own credit in the Banco Minero, a bank in Chihuahua, Mexico, by May 30th, to be paid over by it, on their order, to Terrazas upon the completion of a survey, the approval of the title, and the tender of a proper deed, notes to be given for the balance of the purchase price. In the negotiation preceding the execution of the contract the land had been represented to Ross and Masterson as capable of yielding an average cut of 4,500 feet of timber to the acre, and as being well watered and good grazing land, and suitable for pasturage purposes. They had caused to be inspected a tract pointed out by Terrazas' representatives as the Carillo grant, and, having determined to make the purchase, entered into the contract as stated, under an express guaranty therein provided that the land contracted for was the identical land of which their inspection had been made. The $10,000 payment was duly made to Terrazas, as stipulated, as was the $40,000 deposit in the Banco Minero, the bank executing its receipt to Ross and Masterson, expressing that the deposit was held "subject to payment Alberto Terrazas when transfer land is made."

Thereafter, about the time the survey was completed, Ross and Masterson were advised by an anonymous letter that Terrazas and his associates in the contract were not selling them the land pointed out to and inspected by their representatives; that is, that the land inspected was not in the Carillo grant. This, upon further investigation, was ascertained to be true. Subsequently, they met Terrazas at Chihuahua and announced their readiness to close the purchase if he could deliver the land they had agreed to buy. Terrazas then admitted that he could not deliver the land that had been inspected, as he did not own it, and there was nothing to do but cancel the matter and return the $50,000, no part of which, however, has been returned.

Following a demand on January 25, 1908, for the repayment of the $40,000 deposited with it under the contract, which was refused, Ross and Masterson, on October 27, 1908, instituted this suit against the Banco Minero in the district court of El Paso county for the conversion of the deposit, suing out a garnishment at the same time against the Guaranty Trust & Banking Company, domiciled in that county, which under answer admitted an indebtedness to the defendant of $6,157.40, and that the latter was the owner of 1,057 shares of its capital stock of the value of $150,700.

Before passing to the proceedings and judgment of the trial court, it is appropriate to state here, since it develops the principal question in the case, that on August 14, 1908, Terrazas, for himself and Lauro Carillo, Kraft, and Fulkerson, instituted a suit against Ross and Masterson in the Second civil court of Iturbide district, in the city and state of Chihuahua, to enforce the specific performance of the contract referred to. The Banco Minero was not a party to the suit or the judgment rendered, did not appear, and was served with no character of process prior to the judgment; nor was the $40,000 on deposit with it to the credit of Ross and Masterson in any wise impounded or subjected to the custody of the court prior to the judgment. As to Ross the only mode of service was by publication. He did not appear, and a default judgment was taken against him. Masterson appeared by attorney and attempted to defend against the action. Judgment was rendered against both Ross and Masterson, decreeing that they should specifically perform the contract. Subsequently the judge issued an order to the Banco Minero, as follows:

"I address you the present note, in order that you be pleased to comply with my ruling of the 22d of this month in the execution of the judgment to turn over to Licenciate Jose A. Yanez, attorney for Mr. Terrazas, the aforesaid $40,000.00 American gold, to which I make reference. Liberty and Constitution, Chihuahua, March 29, 1909. [Signed] C. Gorostieta, Rubrics. Addressed to the manager of Banco Minnero of Chihuahua, present."

On the following day, March 30, 1909, the Banco Minero, pursuant to this order, and under the instructions of Terrazas' attorney in the Mexican suit, without resistance or notice to Ross and Masterson, transferred the $40,000 to the credit of Terrazas, to whom it was paid upon his checks.

The Banco Minero, in the present case, duly interposed a plea to the jurisdiction of the court, upon the ground that it was a foreign corporation, domiciled in a foreign country, and neither doing business nor having any office or agent within this state, and that the cause of action arose wholly within the state of Chihuahua, in the republic of Mexico, was local in its nature

Page 713

and cognizable only by the courts of Chihuahua. It furthermore pleaded the judgment in the Mexico suit as an adjudication of the controversy, and its payment of the money involved to Terrazas under the...