Branham v. Short

• Decision Date: 18 July 1975
• Docket Number: No. 17660,17660
• Citation: 526 S.W.2d 639
• Parties: Norris BRANHAM et al., Appellants, v. Eva Mae SHORT, Appellee.
• Court: Texas Court of Appeals

Page 639

526 S.W.2d 639

Norris BRANHAM et al., Appellants, v. Eva Mae SHORT, Appellee.

No. 17660.

Court of Civil Appeals of Texas,

Fort Worth.

July 18, 1975.

Hill, Branham & Graham, and Norris G. Branham, Arlington, for appellants.

Meier, Keith & Adams, and William C. Meier, Euless, for appellee.

OPINION

SPURLOCK, Justice.

This is an appeal by Junie A. Johnson, Jr., and wife, Gladys Rosalie Johnson; and Norris Branham, substitute trustee, from an order of the trial court, granting appellee, Eva Mae Short, a temporary injunction enjoining the Johnsons from exercising during the pendency of this suit their power of sale under the deed of trust executed by appellee covering a residence in Tarrant County. Branham, the substitute trustee, is likewise enjoined from foreclosing on the property during the pendency of this suit.

This suit initiated by Mrs. Short is one in equity seeking rescission of a real estate sale on the grounds of overreaching, misrepresentation, and fraud, and in the alternative, for damages; and for a temporary injunction restraining for the duration of the suit a foreclosure of a deed of trust lien on the property given to secure the balance due on the purchase price of the property.

When the temporary injunction came on for hearing all the parties were present through their attorneys and stipulated that the plaintiff would testify substantially to all the facts as pleaded in her original petition and that all the facts as pleaded were uncontroverted for the purposes of the hearing. The parties further stipulated that the order of the Court would be determined by its resolution of the legal issue of whether or not the foreclosure of the property in question would cause plaintiff to lose her cause of action to sue for rescission under the transaction in question.

The parties in their respective briefs treat the facts alleged under oath in plaintiff's petition as being true for the purpose of this appeal.

We then look to plaintiff's pleading for the facts considered by the trial court in granting the temporary injunction.

Plaintiff alleges at length various acts of fraudulent misrepresentation made by sellers and their real estate agent concerning the property they sold to plaintiff which induced plaintiff to pay $2,000.00 cash and sign a note secured by a vendor's and deed of trust lien for the balance of the purchase price in the amount of $11,500.00, payable in installments of $100.00 each month.

Plaintiff alleges she is a widow who is elderly, is suffering from ailing vision, and the disabilities and infirmities which sometimes affect the aged. She is not experienced in land values or real estate transactions. The sellers and their agents knew this. Sellers misrepresented the physical condition for the property, the cost of placing it in a livable condition, its value on the real estate market, and other material matters that induced plaintiff to enter into the real estate transaction.

She further alleged the sellers had posted the property for sale and it would be sold unless sellers were restrained.

Plaintiff further prayed that the contract of sale, warranty deed, deed of trust note, and deed of trust mortgage be rescinded and that the court place the parties to this transaction in their original position prior to the closing of this real estate transaction.

Appellants predicate this appeal on a single point of error to the effect that the trial court erred in granting appellee's application for temporary restraining order and injunction for the reason that a trustee's foreclosure sale will not preclude a cause of action for rescission of the transaction in question as a matter of law.

A suit to cancel written instruments is an equitable proceeding. It seeks a disaffirmance of the instrument and its cancellation so that the parties thereto may be restored in so far as is possible to their original status or position. Normally the plaintiff must offer to do equity in order to maintain his cause of action. What amounts to an offer to do equity is determined by the widely varied fact situations involved.

Ordinarily the plaintiff must return to defendant, or offer to return to him, whatever he may have received from him. Ordinarily, in a suit to rescind a contract for sale of land, the plaintiff must either tender back the property and title thereto, or else abandon possession of the property and tender a reconveyance thereof in court. Price v. Kittredge, 361 S.W.2d 721 (Fort Worth, Tex.Civ.App., 1962, no writ hist.); Whitfield v. Klein Independent School District, 463 S.W.2d 232 (Houston, Tex.Civ.App., 14th Dist., 1971, ref., n.r.e., 404 U.S. 882, 92 S.Ct. 204, 30 L.Ed.2d 163, cert . denied).

In the event appellee Short did not apply for and obtain a temporary injunction prohibiting the trustee's sale of the property here involved she might have lost her cause of action for the rescission. Texas Co. v. Tucker, 129 S.W.2d 762 (Fort Worth, Tex.Civ.App., 1939, writ ref.); Graham & Locke Investments v. Madison, 295 S.W.2d 234 (Dallas, Tex.Civ.App., 1956, ref., n.r.e.).

In the case of Bank of Southwest National Ass'n v. La Gasse, 321 S .W.2d 101 (Houston, Tex.Civ.App., 1959, no writ hist.) the court had before it a very similar fact situation. In that case a suit was filed for cancellation and rescission of the sale of real property and, in the alternative, damages. A temporary injunction was granted enjoining the sale of the property under a deed of trust and there were allegations of fraud concerning the value of the subject property. The court noted the status of the Texas law concerning the...