Citizens' Nat. Bank v. First Guaranty State Bank

• Decision Date: 08 July 1925
• Docket Number: (No. 1262.)<SMALL><SUP>*</SUP></SMALL&gt
• Citation: 275 S.W. 860
• Parties: CITIZENS' NAT. BANK OF ENNIS v. FIRST GUARANTY STATE BANK OF PALMER.
• Court: Texas Court of Appeals

275 S.W. 860

CITIZENS' NAT. BANK OF ENNIS v. FIRST GUARANTY STATE BANK OF PALMER.

(No. 1262.)^*

Court of Civil Appeals of Texas. Beaumont.

July 8, 1925.

Rehearing Denied October 14, 1925.

Appeal from District Court, Ellis County; W. L. Harding, Judge.

Suit by the First Guaranty State bank of Palmer against the Citizens' National Bank of Ennis and others. Judgment for plaintiff, and defendant named appeals. Affirmed.

Sharp & Gray, of Ennis, for appellant.

G. C. Groce and Farrar & Kemble, all of Waxahachie, for appellee.

HIGHTOWER, C. J.

The appellee, First Guaranty State Bank of Palmer, Tex., filed this suit in the district court of Ellis county against A. J. Davis, J. Baldridge, and the Citizens' National Bank of Ennis, Tex., as defendants, alleging that on the 14th day of February, 1920, Davis and one T. B. Truitt executed their note in favor of appellee for the sum of $3,599, due November 1, 1920, and bearing interest at the rate of 10 per cent. per annum from date, and providing for the usual 10 per cent. attorneys' fees. It was alleged that, after allowing proper credits as payments made on this note, there was a balance due appellee of $1,650, for which amount appellee prayed judgment against Davis as one of the defendants.

It was then alleged by the appellee that Truitt was dead, and that his estate was insolvent, and that neither his administrator nor his heirs were made parties, and that Davis was a surety on the note and Truitt the principal. Appellee then alleged that on February 14, 1920, Truitt executed and delivered to appellee a chattel mortgage on "20 B/C," meaning and intending to mean "20 bales of cotton," to be raised on the farm or farms of Truitt in Ellis county, consisting of 350 acres of land, situated about one mile northeast of Bristol, in Ellis county, during the year 1920; that thereafter during said year there was raised on the farm or farms belonging to Truitt 32 bales of cotton, in which his tenants owned a one-half interest, to wit, 16 bales, to which the mortgage attached and constituted a lien securing the payment of said note, and that appellee had elected to sue for the interest that Truitt had in the 32 bales of cotton; that the mortgage was duly recorded on February 19, 1920; and that the defendants Baldridge and the Citizens' National Bank had knowledge of such lien, or at least had legal notice at the time they converted the cotton.

Appellee then alleged that 32 bales of the cotton was gathered in the fall of 1920, and that the tickets for the cotton were placed with Baldridge and the Citizens' National Bank, and that they took charge of the cotton and converted the same to their own use and benefit, to plaintiff's damage in the sum of $1,600, that Baldridge and the Citizens' National Bank sold the 32 bales of cotton and converted the proceeds thereof, and that appellee was entitled to judgment against the defendant bank, of which he was president.

Baldridge and the Citizens' National Bank answered by general and special exceptions, and by general and special answer, alleging, substantially that plaintiff had no valid mortgage on any of the cotton; that its claimed mortgage was so vague and indefinite as to description of the property covered that same could not constitute a valid and binding lien upon the cotton; that Truitt owed the Citizens' National Bank considerable money, and that it had a lien upon certain mules and other property described in a mortgage, and that, for the purpose of getting the bank's note extended, Truitt requested the Citizens' National Bank to extend same, and stated to that bank that he would put up certain bales of cotton as collateral security to his note, and that, in consequence thereof, the Citizens' National Bank did extend the note, and that Truitt stated at the time that the cotton was clear of any claim or incumbrance, and that he was authorized to hypothecate same as collateral to secure the bank's debt. Baldridge and the bank further answered that the cotton was sold at the instance and request and under the supervision of Truitt, and that whatever was done was done at his instance and request and under his supervision, and that the proceeds of the sale of the cotton was not sufficient to liquidate the amount of the indebtedness that Truitt owed the Citizens' National Bank, and that that bank and Baldridge were not guilty of conversion of any of the cotton. The appellant bank and Baldridge further alleged that, if plaintiff had a valid lien against the cotton, nevertheless, on account of the indefinite description given in the mortgage, appellee would only have a pro rata part of same against all of the cotton raised by Truitt for the year 1920, and that, if the Citizens' National Bank and Baldridge were responsible at all to appellee as for the conversion of any of the cotton, it would be only a pro rata part of the 20 bales as it bears to the entire number of bales of cotton raised by Truitt during the year for which the mortgage was given.

The defendant Davis adopted the pleadings of the appellee. The case was submitted to the jury upon special issues, and upon their answers thereto judgment was rendered in favor of the First Guaranty State Bank of Palmer, the plaintiff, against Davis, in the sum of $1,752.15; and the court expressly found, as recited in the judgment, that one-half interest in the 32 bales of cotton that were converted by the Citizens' National belonged to Truitt, and that appellee's mortgage attached to this 16 bales, and judgment was rendered in favor of appellee against the Citizens' National Bank of Ennis in the sum of $1,335.50, with interest at the legal rate. It was further provided in the judgment that, when the amount of the judgment against the Citizens' National Bank in favor of the appellee had been collected, the same would be credited upon the judgment rendered in favor of appellee against Davis, and that Davis would be subrogated to the rights of appellee as against the Citizens' National Bank of Ennis as to any part of appellee's judgment remaining unpaid. After its motion for new trial had been presented and overruled, the Citizens' National Bank of Ennis prosecuted this appeal.

It is appellant's first contention, in substance, that the description of the property covered by the mortgage sought to be foreclosed is so vague and indefinite that it did not constitute a lien upon any property, and was not enforceable against appellants as sought by the appellee. The description contained in the mortgage executed by Truitt in favor of appellee was as follows:

"Twenty B/C raised on my farm or farms in the year 1920, said land consisting of 350 acres and situated about 1 mile N. E. of Bristol, Tex."

In keeping with appellant's contention in this connection, it requested the trial court to peremptorily instruct a verdict in its favor, which the court refused, and now appellant insists that that action was error.

It is appellee's contention in this connection that the description contained in the mortgage covering the cotton was a sufficient description, since the number of bales mortgaged were stated, the year in which the cotton was to be raised was stated, and the land upon which it was to be raised was definitely stated and located in the mortgage, and that its registration, which was forthwith had upon its execution, gave notice to appellant of appellee's lien on the cotton.

The only possible objection that appellant could make to the description of the cotton intended to be mortgaged was because of the use of the abbreviation "20 B/C," instead of writing out in full "20 bales of cotton."

Mr. Baldridge, who was president of appellant bank, testified, substantially, that during the year 1920 and 1921, in his capacity as president of the bank, he took over the receipts from Truitt of the cotton charged to have been converted by appellee, and that he had same sold and applied the preceeds upon a debt owed by Truitt to appellant. In this connection, Mr. Baldridge said:

"I had known Mr. T. B. Truitt for many years, and had a great many business dealings with him, and knew that he was a farmer out in the Bristol community, and that he owned a farm out there, and I knew about the location of the farm near Bristol. I have seen farm lands around Bristol, but don't know that I ever saw the particular land that Mr. Truitt owned. I knew all this at the time I took the cotton tickets from Mr. Truitt, and I had reason to believe that the cotton covered by these tickets was...