Dansby v. Stroud, 1173.

• Decision Date: 07 April 1932
• Docket Number: No. 1173.,1173.
• Citation: 48 S.W.2d 1018
• Parties: DANSBY v. STROUD.
• Court: Texas Court of Appeals

48 S.W.2d 1018

DANSBY v. STROUD.

No. 1173.

Court of Civil Appeals of Texas. Waco.

April 7, 1932.

Rehearing Denied April 28, 1932.

Appeal from District Court, Hill County; Walter L. Wray, Judge.

Action by W. O. Stroud against Charles E. Dansby and others. From a judgment in favor of plaintiff, named defendant appeals.

Affirmed.

Jos. W. Hale, of Waco, for appellant.

John Abney, of Hillsboro, for appellee.

ALEXANDER, J.

This action was brought by W. O. Stroud against B. G. Trimmier, Lee Ellison, and Chas. E. Dansby to recover on three promissory notes due January 1, 1928, 1929, and 1930, respectively. The notes were executed by Trimmier to Ellison in part payment of a tract of land in Limestone county. Ellison assigned the notes to Stroud and guaranteed the payment thereof. Trimmier afterwards conveyed the land to Dansby who assumed the payment of the notes and Dansby in turn conveyed the land to Powell, who likewise assumed the payment of the notes. Powell died, and the land was sold by the administrator of his estate, and the funds applied to the payment of a prior lien on the land. The court, upon the verdict of a jury, entered judgment in favor of Stroud against the three defendants for the amount of the last two maturing notes. Dansby appealed.

The case was tried in Hill county, and Dansby complains of the action of the court in overruling his plea of privilege to be sued in Bosque county, the county of his residence. The notes were payable in Hill county. The deed from Trimmier to Dansby recited that Dansby assumed the "notes." While Dansby did not execute any written contract by which he bound himself to pay the notes in Hill county, he accepted and recorded the deed containing such a provision, and afterwards accepted the benefits thereof by conveying the land to Powell. When a contract between two parties is thus reduced to writing and signed by one of them and accepted by the other, it becomes in contemplation of law a written contract between such parties and will be so treated by the courts of this state. Clegg v. Brannan, 111 Tex 367, 234 S. W. 1076, par. 2; Johnson v. Tunstall (Tex. Com. App.) 25 S.W.(2d) 828, par. 3; Orbeck v. Alfei (Tex. Civ. App.) 276 S. W. 947, par. 1; McClure v. Fall (Tex. Civ. App.) 42 S.W.(2d) 821, par. 13, and cases there cited. Dansby, by assuming the payment of the notes, assumed the terms thereof and became obligated to pay the debt in Hill county according to the terms thereof, and venue was properly laid in that county. Revised Statutes, article 1995, § 5; Flatt v. Republic Insurance Co. (Tex. Civ. App.) 19 S.W. (2d) 826, sec. 4.

As before stated, the notes matured January 1, 1928, 1929, and 1930, respectively. They were not presented for payment within the time provided for in Revised Statutes, article 5937. Dansby contends that, when Powell assumed the payment of the notes, he (Dansby) occupied the position of an indorser and was released by the failure of Stroud to timely present the notes for payment as provided for in the above statute. We think the appellant is in error in assuming that his relation to the debt held by Stroud was that of an indorser. The rule seems to be that, where a party who is liable for the payment of a vendor's lien note conveys the land to a subsequent vendee who assumes the payment of the notes, as between him and his vendee, his vendee becomes primarily liable, and he becomes a surety, but as between them and the holder of the notes they are both primarily obligors. Middleton v. Nibling (Tex. Civ. App.) 142 S. W. 968, par. 3. If the holder of the notes accepts the promise of the subsequent purchaser to pay the notes, such subsequent purchaser becomes primarily liable and his vendor becomes surety. Hill v. Hoeldtke, 104 Tex. 594, 142 S. W. 871, par. 4, 40 L. R. A. (N. S.) 672; Caraway v. Fowler (Tex. Com. App.) 267 S. W. 672. In no event does such vendor's relation to the debt become that of indorser, and he therefore is not released by the failure to promptly present the notes for payment. Georges v. Fricke (Tex. Civ. App.) 283 S. W. 221, par. 5 (writ refused).

After the first note became due in 1928, Dansby in writing notified Stroud to bring suit, as provided in Revised Statutes, article 6244. Stroud failed to promptly file suit, and thereafter entered into an agreement with Powell without Dansby's consent by which the first maturing note was extended to August 5, 1928. The time of payment of the other two notes was not extended. Dansby contends that Stroud, by failing to file suit at the first term of court after such notice and by entering into the extension agreement with Powell with reference to the first note, thereby released Dansby from liability on the other two notes. The rule that a surety is released by an unauthorized extension agreement between the principal obligor and the payee grows out of the doctrine that such parties ought not to be permitted to so change the original obligation as to alter the surety's rights or impose greater burdens on him. When the obligation matures, the surety has the right to demand that suit be brought at once or to pay the debt and to proceed immediately to enforce payment by the principal obligor. If the extension agreement as made in this case had the effect of depriving Dansby of either of these rights as to the last maturing notes, then he was released therefrom, otherwise he was not. While the lien securing the payment of the debt was retained in the one deed from Trimmier to Ellison, the debt was evidenced by three separate notes. We do not think that the notes can be construed as a single obligation, but must be considered as three separate obligations. The failure to pay one of the notes at its maturity did not necessarily mature all of them. The notes provided for accelerated maturity only in the event the holder thereof so elected. When the first note matured, Dansby's right to require that suit be brought thereon, or to pay such note and...