Beville v. Boyd

• Decision Date: 05 July 1897
• Citation: Beville v. Boyd, 41 S.W. 670 (Tex. App. 1897)
• Parties: BEVILLE v. BOYD.<SMALL><SUP>1</SUP></SMALL>
• Court: Texas Court of Appeals

41 S.W. 670

BEVILLE v. BOYD.¹

Court of Civil Appeals of Texas.

July 5, 1897.

Appeal from district court, Wise county; J. W. Patterson, Judge.

Action by R. M. Beville against O. E. Boyd. There was judgment for plaintiff for the balance of his claim over damages awarded defendant in reconvention, and quashing an attachment by plaintiff, and plaintiff appeals. Reversed and rendered as to the quashing of the attachment; otherwise affirmed.

Bullock & Tankersley and Spencer & Basham, for appellant. R. E. Carswell, for appellee.

STEPHENS, J.

Appellant was surety for appellee to the Wise County National Bank on a promissory note in the sum of $1,000, which provided for interest at the rate of 10 per cent. per annum, "and ten per cent. additional as attorney's fees if sued upon or placed in the hands of an attorney for collection." When the note matured, and without its ever having been placed in the hands of an attorney for collection, appellant paid it off, or, rather, took it up, and had it indorsed to him, by executing his own note payable at a future date. The bank also held a small note (of $66) against the appellee, which was, in the same transaction, assigned to appellant. This was an attachment suit brought against appellee by appellant, in which the affidavit for attachment stated that the appellee was justly indebted to the appellant in the sum of $1,178.95, which was the total amount of the two notes,—principal, interest, and attorney's fees. The petition, however, merely alleged the execution, payment, and assignment of the two notes, without alleging that either of them had ever been sued upon or placed in the hands of an attorney by the bank, or that appellant had paid the amount specified therein as attorney's fees, and prayed to have judgment for said sums of money and costs of suit, without naming any sums; that is to say, the petition on its face showed a less sum to be due than was stated in the affidavit for attachment, unless appellant was entitled to recover the amount of the attorney's fees specified in the larger note. Upon this ground the appellee moved to quash the attachment, and pending this motion the appellant amended his petition; alleging that the $1,000 note had been placed by the bank in the hands of attorneys for collection, and that he had paid, not only the principal and interest, but also the amount of attorney's fees. The trial developed that there was no truth in this allegation whatever, and that the evident purpose of it was to uphold the attachment. The court, however, sustained the motion, notwithstanding the amended petition, and to this action the first error is assigned.

First, was the change made by the amendment essential; and, second, was it effectual? In Carpenter v. Minter, 72 Tex. 370, 12 S. W. 180, it was expressly held that a surety paying off the note was entitled to sue upon it and recover the attorney's fees therein provided for from the principal maker, the same as the original holder might have done. This very just rule, which allowed a complete, and not merely a partial, substitution of the surety to the rights of the original creditor against the principal debtor, became the rule of decision in this state as early as 1857. Sublett v. McKinney, 19 Tex. 439. The reason of the rule was thus stated, in the case last cited, by Justice Wheeler: "These latter cases, while they hold the general doctrine that the surety is entitled to every remedy which the creditor has, and to have an assignment of all the securities in the hands of the creditors, yet deny him the right of complete substitution to the rights of the creditor, by having assigned to him the very obligation upon which he was surety, upon this technical idea that the payment by the surety is an extinguishment of the obligation, and the assignment of it would transfer that which, being extinguished, is no longer any security. But this narrow technical view of the case has not received the approbation of courts of equity generally in this country. The subject was examined with great learning, research, and ability by the supreme court of Georgia in the case of Lumpkin v. Mills, 4 Ga. 343; and the doctrine of the two English cases last cited was discarded, as opposed to the great weight of authority, English and American, as unsound in principle, and unfit to have a place in the enlightened remedial justice of a court of equity. The principle which supports the right of substitution to the rights and remedies of the creditor applies equally to his right to have a transfer of the particular obligation or contract as to any other security. `The substitution of the surety,' it is pertinently said, `is not for the creditor as he stands related to the principal after the payment, but as he stood related to him before the payment. He is subrogated to such rights as the creditor then had against the principal, one of which, unquestionably, was to enforce his bond against the principal.' Id. 349. This is certainly the correct deduction from the universally admitted right of substitution. For if the doctrine were sound, that the obligation on which the surety was bound cannot be assigned, because it is extinguished by the payment, it would apply equally to every other security, and destroy the right of substitution altogether. For the payment of the debt operates as complete an extinguishment, in equity, of every collateral security, as it does of the obligation of the principal security. So it has been uniformly held by this court in the case of mortgage and other securities." Following this rule so early and ably enunciated, and a decision directly in point, which was adopted by our supreme court as late as 1888 (Carpenter v. Minter, supra), appellant sued out his attachment, February 12, 1895, a few months before the case of Faires v. Cockerell, 88 Tex. 428, 31 S. W. 190, 639, was decided, in which the opinion of Justice Brown purports to overrule this line of decisions. Following this opinion, the district judge quashed the attachment. If the case of Faires v. Cockerell be not distinguishable from the case at bar, and the opinion of Justice Brown, in so far as it...