Borden v. Arnold

• Court: Texas Court of Appeals
• Writing for the Court: Jackson
• Citation: Borden v. Arnold, 94 S.W.2d 216 (Tex. App. 1936)
• Decision Date: 20 April 1936
• Docket Number: No. 4589.,4589.
• Parties: BORDEN et ux. v. ARNOLD et al.

94 S.W.2d 216

BORDEN et ux. v. ARNOLD et al.

No. 4589.

Court of Civil Appeals of Texas. Amarillo.

April 20, 1936.

Rehearing Denied May 18, 1936.

Appeal from District Court, Deaf Smith County; Reese Tatum, Judge.

Action by B. S. Arnold and others against L. F. Borden and his wife. From a judgment, defendants appeal.

Affirmed.

James W. Witherspoon, of Hereford, for appellants.

Underwood, Johnson, Dooley & Huff, of Amarillo (W. M. Sutton, of Amarillo, of counsel), for appellees.

JACKSON, Justice.

On June 28, 1930, W. B. Arnold loaned the sum of $3,000 to L. F. Borden, who, with his wife, Grace Borden, executed therefor a promissory note, due in twelve months with interest thereon from date at the rate of 10 per cent. per annum.

On September 5th thereafter W. B. Arnold loaned an additional sum of $4,000 to L. F. Borden, who, with his wife, executed therefor a promissory note due in twelve months with interest thereon from date at the rate of 8 per cent. per annum.

On the date the last note was executed, Borden and wife gave W. B. Arnold their deed of trust, creating a valid lien on section 18, block 3, in Deaf Smith county, to secure the payment of the two notes. On March 22, 1932, they executed another deed of trust to the said Arnold, creating a valid lien on the northeast 1/4 of section 17 and the southwest 1/4 of section 124, both in block 3, in Deaf Smith county, as additional security for the payment of the two notes, and by the terms of this second deed of trust the time of the payment of the notes was extended until September 30, 1932.

On the date said second deed of trust was executed Borden and wife also transferred and assigned, by their indorsement, to W. B. Arnold as collateral, four vendor's lien notes of one series, payable January 5, 1932, and four vendor's lien notes of another series, one due March 1, 1933, and one on March 1st each year thereafter up to and including 1936.

The loans were not contracted by the wife for necessaries or for expenses incurred for the benefit of her separate property.

W. B. Arnold died testate May 25, 1932, devising all of his property to his wife, Mrs. E. M. Arnold, who was duly appointed and qualified and is the independent executrix of his estate and the owner of the notes secured by the aforesaid deeds of trust, and the indorsed vendor's lien notes.

On October 5th thereafter, L. F. Borden, without the consent of his wife, entered into a valid written agreement with B. S. Arnold, the attorney in fact for Mrs. E. M. Arnold, extending the time of the payment of the two notes executed by Borden and wife, Grace Borden, and she at no time thereafter ratified such extension.

On all the dates involved herein Grace Borden was the wife of L. F. Borden, and owned in her own separate right and estate an undivided one-half interest in the lands covered by the deeds of trust, and an undivided one-half interest in the vendor's lien notes indorsed to W. B. Arnold as collateral security for his debt.

At the time the extension agreement was made, October 5, 1932, L. F. Borden paid the sum of $600, which was credited upon the interest due on the $3,000 note. Thereafter the appellee Mrs. E. M. Arnold instituted this suit to recover judgment for her debt against L. F. Borden, and a foreclosure of her liens on the lands described in the deeds of trust and upon the vendor's lien notes indorsed and pledged to her deceased husband as collateral.

Mrs. Grace Borden, appellant, joined pro forma by her husband, pleaded her coverture, her separate property rights, the extension of the time of the payment without her consent of the two notes executed by her and her husband to W. B. Arnold and asked that all liens claimed against her undivided one-half interest in the lands covered by the deeds of trust, together with the liens claimed against her undivided one-half interest in the vendor's lien notes pledged as collateral, be canceled, held for naught, and released from all liability for the indebtedness sued on.

The case was submitted to the court without the intervention of a jury, and judgment rendered that Mrs. Grace Borden take nothing; that Mrs. E. M. Arnold have judgment for her debt, principal, interest, and attorney's fees against L. F. Borden, and a foreclosure of her deeds of trust on the land and her pledgee's lien on the vendor's lien notes against both L. F. and Grace Borden, from which judgment, by writ of error, this appeal is prosecuted. No complaint is made of the judgment for the debt and the foreclosure of the liens against L. F. Borden.

It is contended, in behalf of appellant Grace Borden, that since she was under the disability of coverture, was the owner in her separate right of an undivided one-half interest in the lands and vendor's lien notes encumbered, had made no contract for necessaries or for the benefit of her separate estate, and the time of payment of the notes was extended without her knowledge or consent, her separate property was released from the liens because it occupied only the relation of surety for the debt.

It is the settled law that the appellant's separate property occupied the relation of a surety, Red River Nat. Bank v. Ferguson, 109 Tex. 287, 206 S.W. 923; and if the time of payment was extended without her consent, such property was released, Red River Nat. Bank v. Bray et al., 105 Tex. 312, 148 S.W. 290. It is equally well settled, however, that a surety who consents thereto cannot avail himself of such extension agreement to defeat his liability. Such consent may be contained in the note evidencing the debt, and it is immaterial whether the assent be given prior or subsequent to the extension of the time of payment. State Nat. Bank of Fort Worth v. Vickery (Tex.Com.App.) 206 S. W. 841; Smallwood et al. v. First Nat. Bank of Bandera (Tex.Civ.App.) 300 S. W. 665.

"The extension between the principal obligor and the holder postpones the right of action and the commencement of the running of limitation until expiration of the period for which the extension is granted. Dalton v. Rainey, 75 Tex. 516, 13 S.W. 34; 8 C.J. 441.

"In general, the giving and taking of the new paper simply operates as an extension of the time of payment of the original indebtedness. 6 Tex.Jur. p. 810; 8 C.J. 441; 7 Cyc. 891.

"While an extension of time of payment between the creditor and principal debtor without a surety's consent operates as a release as to the surety (Red River Nat. Bank v. Bray, 105 Tex. [312] 315, 148 S.W. 290; Benson v. Phipps, 87 Tex. 578, 29 S. W. 1061, 47 Am.St.Rep. 128), this right may be waived by such surety, either in advance or afterwards (Darby v. Bank (Tex. Civ.App.) 253 S.W. 341; National Bank of Commerce v. Kenney, 98 Tex. 293, 83 S.W. 368; Jackson v. Bank (Tex.Civ.App.) 185 S.W. 893; Commonwealth Nat. Bank v. Goldstein (Tex.Civ.App.) 261 S.W. 538; Sharpe v. Bank (Tex.Civ.App.) 272 S.W. 321; 8 C.J. § 681; 7 Cyc. 922); such waiver enters into the contract of every person who signs, whether as drawer, maker, acceptor, or indorser (Williams Bros. v. Rosenbaum (Tex.Civ.App.) 79 S.W. 594; Leeds v. Hamilton Paint & Glass Co. (Tex.Civ. App.) 35 S.W. 77; Daniels Neg. Inst., § 1092), and permits of more than one extension of the time of payment without the consent of and without discharging the surety from liability (State Nat. Bank v. Vickery (Tex.Com.App.) 206 S.W. 841; Archenhold Co. v. Smith (Tex.Civ.App.) 218 S.W. 808). Such a waiver does not increase the original liability of the surety; it merely renders unnecessary the performance of the acts waived in order to fix liability. State Nat. Bank v. Vickery, supra." Brinker v. First Nat. Bank of Cleveland, Okl. (Tex.Com.A...