Breaux v. Banker

• Decision Date: 15 April 1937
• Docket Number: No. 3087.,3087.
• Parties: BREAUX et ux. v. BANKER et al.
• Court: Texas Court of Appeals

107 S.W.2d 382

BREAUX et ux. v. BANKER et al.

No. 3087.

Court of Civil Appeals of Texas. Beaumont.

April 15, 1937.

Rehearing Denied June 30, 1937.

COPYRIGHT MATERIAL OMITTED

Appeal from District Court, Jefferson County; Geo. C. O'Brien, Judge.

Suit by E. H. Breaux and wife against H. F. Banker and another. From a judgment against defendant Bruce Badger and in favor of named defendant, plaintiffs appeal.

Reversed, and rendered.

Gordon, Lawhon, Sharfstein & Bell, of Beaumont, and B. T. McWhorter, Jr., of Port Arthur, for appellants.

Smith, Smith & Boyd, of Beaumont, for appellees.

WALKER, Chief Justice.

By his warranty deed, dated 17th of December, 1924, appellant E. H. Breaux conveyed to Mr. and Mrs. Elmer Preston Webb Lot No. 1 of Breaux Acres addition of Jefferson county, hereinafter referred to as Lot No. 1; in part consideration, the Webbs executed to appellant their promissory note of even date with the deed in the sum of $1,950, payable in monthly installments of $10, beginning with the 17th day of January, 1925, secured by the vendor's lien retained both in the deed and in the note against Lot No. 1. By their warranty deed, dated 17th day of June, 1930, the Webbs conveyed Lot No. 1 to appellee H. F. Banker; that deed contained the following stipulation: "It is expressly understood that this conveyance is made subject to a certain outstanding indebtedness of One Thousand Seven Hundred Fifteen and No/100 ($1,715.00) Dollars."

By their warranty deed, dated 2d day of February, 1931, appellee Banker, joined by his wife, conveyed Lot No. 1 to J. A. and V. V. Willis on the recited consideration of $100 in cash, which was in fact paid, and a promissory note for $1,900, executed by J. A. and V. V. Willis, payable to appellee in monthly installments of $25 beginning the 2d day of March, 1931, secured by the vendor's lien retained both in the note and in the deed, against Lot No. 1; that deed contained the following express promise and agreement by appellee: "It is expressly understood between the parties hereto that there is an outstanding indebtedness against the property hereinabove described, amounting to the sum of $1,370.00 which the grantors herein agree to pay as it matures, upon failure to do so, the grantees herein are given the right to pay same, and payments so made shall apply on the note herein given as part of the consideration."

J. A. and V. V. Willis defaulted in the payments on their note to appellee; on the 13th day of January, 1933, with the consent of appellee and acting under his directions, they conveyed by their deed in writing Lot No. 1 to Bruce Badger of Kansas, and in adjusting "back interest" on appellee's note for $1,900, they paid him in cash an additional sum at that time of about $145. After the execution by them of the deed to Badger, appellees surrendered to them their $1,900 note. The indebtedness referred to by appellee in his deed to the Willises as "an outstanding indebtedness against the property herein above described, amounting to the sum of $1370.00" was the unpaid balance of the note executed by the Webbs to appellant on the 17th day of December, 1924, as part consideration for the deed whereby appellant conveyed them Lot No. 1 as stated above. Though appellee did not assume the payment of that note in accepting the deed to Lot No. 1 from the Webbs, he paid the monthly installments provided for in the face of the note after he acquired his deed from the Webbs until he executed and delivered his deed to J. A. and V. V. Willis; after that date he made two payments on appellant's Webb note, one for $20 and one for about $18. Appellant knew of the execution of the deed by the Webbs to appellee, and that appellee was regularly paying the monthly installments on the Webb note, and looked to appellee to pay that note. Appellant did not know of appellee's deed to J. A. and V. V. Willis until a short time before this suit was filed, and so, of course, did not know until that time of appellee's promise in his deed to J. A. and V. V. Willis to pay the balance due on the Webb note; with actual knowledge of that deed and of appellee's promise, appellant filed this suit praying for judgment against Bruce Badger for foreclosure of the vendor's lien against Lot No. 1 as originally retained in his deed to the Webbs of date December 17, 1924, and for personal judgment against appellee for the balance due on the Webb note. For cause of action against appellee, appellant plead in haec verba his deed to J. A. and V. V. Willis, and that, as a part of the consideration for said deed, appellee agreed to pay the Webb note; in relation to that deed he alleged further that "the sum of Two Thousand Dollars ($2,000.00) was the total consideration in said deed for the conveyance of such property and that the said J. A. Willis and V. V. Willis paid One Hundred Dollars ($100.00) in cash and executed their note for the balance of Nineteen Hundred and No/100 ($1900.00) Dollars; that the said H. F. Banker as part of the consideration therefor agreed to pay all mortgages and liens then existing against such property, and especially the note and lien owned by this plaintiff, in consideration of the payment to him of the total consideration by said grantees, J. A. Willis and V. V. Willis, amounting to Two Thousand and No/100 ($2,000.00) Dollars, which was the sales price of said lands, and that the defendant, H. F. Banker, thereby became liable and bound to pay the note owned and held by this plaintiff."

On trial to a jury, judgment was entered in appellant's favor on an instructed verdict against Bruce Badger foreclosing the vendor's lien as prayed for, and in favor of appellee that he go hence without day and recover his costs of and from appellant; all costs were taxed against appellant, since Bruce Badger, a nonresident, was not personally served with citation and did not make his personal appearance in the case. From that judgment appellant has duly prosecuted his appeal to this court.

Opinion.

On the pleadings and all the evidence, appellant should have been awarded judgment against appellee for the unpaid balance of the Webb note, the note sued upon by appellant and described in his petition.

It is the settled law of this state that a third party may enforce a contract made upon a valuable consideration by other parties for his benefit; a formal acceptance by him of such contract is not necessary; a suit on the contract evidences his acceptance. Aetna Life Ins. Co. v. Texarkana National Bank (Tex.Civ.App.) 60 S.W.(2d) 251; Key v. Alamo Nat. Co. (Tex.Civ.App.) 62 S.W.(2d) 1002. It is also the law of this state that the promisor in such a contract cannot withdraw from the contract and release himself from the obligations of his promise, when once accepted by the third party, without the consent of the third party. Hill v. Hoeldtke, 104 Tex. 594, 142 S.W. 871, 40 L.R.A.(N.S.) 672. It is also the law that the liability of the promisor is contractual in its nature, based upon the well-settled principle that "where one person for a valuable consideration makes a promise to the person from whom the consideration moves for the benefit of a third person, such third person may maintain an action thereon. 3 Pomeroy, Eq.Jur. § 1207." Allen v. Traylor (Tex.Com.App.) 212 S.W. 945, 946. The facts in the Allen Case were as follows: The Rockport Land Company and Harry Traylor conveyed to McKey and Pridgen certain lands, and in payment therefor the purchasers executed and delivered their vendor's lien notes payable to the order of the land company. The company transferred the notes to Traylor. McKey and Pridgen conveyed the land to M. Ucovich, subject to the vendor's lien. Thereafter Ucovich conveyed part of the land to Frank Allen, who, as a part of the consideration therefor, assumed the payment of a certain part of the vendor's lien indebtedness against the land. Traylor brought suit against Allen and McKey and Pridgen, to recover a balance due on the notes. Allen's immediate vendor, Ucovich, who purchased the property subject to, but not assuming the payment of, the vendor's lien, was not made a party to the suit. Under the facts stated, holding Allen liable on his promise to Ucovich to pay a certain part of the vendor's lien indebtedness against the land, Judge Sonfield said:

"Upon a careful consideration of the authorities, we are inclined to the view that the liability under a contract, for the benefit of a third person, a stranger thereto, and the right of such third person to enforce the contract, should not be limited by the requirement that there be some obligation or duty owing from the promisee to such third person. The right `does not rest upon the ground of any actual or supposed relationship between the parties, as some of the earlier cases seem to indicate, * * * but upon the broader, and more satisfactory basis that the law, operating upon the acts of the parties, creates the duty, establishes the privity, and implies the promise and obligation on which the action is founded.' Brewer v. Dyer, 7 Cush.(Mass.) 337; Dean v. Walker, 107 Ill. 540, 47 Am.Rep. 467.

"Allen and his vendor contracted for the purchase and sale of the land and the consideration to be paid therefor. It is wholly immaterial, as far as Allen is concerned, to whom the purchase money or any part thereof was to be paid, and, if to some third person, whether his vendor was under any legal obligation to such third person. If his vendor directed the payment of part of the purchase price to one to whom he was under no obligation, the same being intended as a mere gratuity, Allen has no ground for complaint; such agreement being upon a valuable consideration. The lien debt assumed by Allen was a part and parcel of the consideration for the purchase of the land. The amount so assumed constitutes in legal effect a debt due by Allen which he agreed to pay to the holder of the notes instead of to his vendor, from whom the...