Davidson v. McKinley

• Decision Date: 21 December 1912
• Citation: Davidson v. McKinley, 152 S.W. 1142 (Tex. App. 1912)
• Parties: DAVIDSON v. McKINLEY et al.
• Court: Texas Court of Appeals

152 S.W. 1142

DAVIDSON v. McKINLEY et al.

Court of Civil Appeals of Texas. Amarillo.

December 21, 1912.

Rehearing Denied January 18, 1913.

Appeal from District Court, Deaf Smith County; D. B. Hill, Judge.

Action by G. L. Davidson against H. B. McKinley and another. From a judgment for defendants, plaintiff appeals. Reversed and rendered.

See, also, 146 S. W. 576.

Barcus & North, of Weatherford, for appellant. W. H. Russell and Carl Gilliland, both of Hereford, for appellees.

HUFF, C. J.

This action was brought by G. L. Davidson against H. B. McKinley and J. D. Thompson, in the district court of Deaf Smith county, on an indemnity contract and note for $750, bearing interest at the rate of 10 per cent. from maturity, with 10 per cent. attorney's fees if sued on or placed in the hands of an attorney for collection. The note was part of the indemnity contract, and declared on as part thereof. At this time it is not deemed necessary to set out the pleadings more at length, as the facts in the case are practically undisputed, and will sufficiently show the nature of the action.

On August 26, 1907, appellee H. B. McKinley purchased from D. W. Hawkins 80 acres of land out of section No. 80, in block K-3, Deaf Smith county, Tex., and as a part of the consideration executed two certain vendor's lien notes for the sum of $750 each, payable to the order of D. W. Hawkins and signed by H. B. McKinley, and retained a vendor's lien in said deed of conveyance to secure the payments of said notes. On April 3, 1908, H. B. McKinley sold the said property to appellant, G. L. Davidson, and gave Davidson a warranty deed to same. Appellant knew at that time that the two notes were against the land, but did not assume the payment of the same or agree to pay them, it being the agreement between him and McKinley that McKinley would pay the notes when they became due. To protect himself against loss or damage on account of said notes being against the land in case he should have to pay them or either of them, appellant demanded and received from appellee McKinley two notes for the same amounts as the said vendor's lien notes and due at the same time, executed by appellees McKinley and J. D. Thompson; appellee McKinley agreeing at that time to pay off said vendor's lien notes when they became due and to get a release for same, and, when that was done, appellant was to surrender the indemnity notes given to him by appellees. When the first of said vendor's lien notes fell due in August, 1908, appellee McKinley paid same, and appellant then turned over to him the first of said indemnity notes; but, when the second of said vendor's lien notes became due, appellee McKinley did not pay same, and the holder and owner of said notes, D. W. Hawkins, sold the said note to the First State Bank & Trust Company of Hereford for value, indorsing the note at that time, but did not execute a written transfer of the lien and note. McKinley thereafter continued to pay the interest on said note until the summer of 1910, and about the month of August, 1910, appellant asked appellee McKinley if he had ever paid off said note and gotten same released, and was informed that he had not done so, but that he would do so in a few days, and a short time thereafter, about October, 1910, appellee McKinley told the appellant that he had gotten a release of said last vendor's lien note, and had the same recorded, and that he, appellant, could get the said release from the clerk's office, and appellant then called at the clerk's office and got the release, and found the same was the regular release of the vendor's lien and properly executed by D. W. Hawkins. Appellant did not know at this time that Hawkins had sold the note to the First State Bank & Trust Company of Hereford, and supposed the release was all right, and made no investigation, simply taking McKinley's word in the matter. In a few days thereafter appellant delivered the second and last of the indemnity notes to McKinley; this being done in November, 1910, and about that time the bank, the owner of the note, learned what had happened, and took the matter up with all parties, in an effort to get same straightened out, and get the release canceled, but this appellant refused to do, and upon the advice of attorney that the release was all, right and would hold, and not to cancel same, he refused to cancel. The bank then brought suit against appellee H. B. McKinley and appellants G. L. Davidson and D. W. Hawkins on said vendor's lien note, and asked for a judgment, fixing its lien and a foreclosure of same on the land purchased by appellant from McKinley. Appellant and D. W. Hawkins answered and defended said suit. The case was tried in the district court of Deaf Smith county, Tex., and resulted in a verdict and judgment against H. B. McKinley for $886.10, with 8 per cent. interest from May 16, 1911, and a foreclosure of the lien on the land and a cancellation of the release, and ordered the land sold to satisfy the judgment, and, in order to protect his land from forced sale, appellant was forced to pay and did pay said judgment on July, 1, 1911, together with all costs thereon, the costs amounting to $19.85. After the judgment had been obtained against appellant, he got possession of the last of said indemnity notes from the attorneys for appellee H. B. McKinley, and turned the same over to Barcus & North for collection, who brought suit thereon as above stated. This suit was filed on the last of the two indemnity notes and the former judgment fixing the lien on the land and the payment of same by appellant, which was fully set out in appellant's petition. The last of the two vendor's lien notes was admitted never paid by McKinley nor any one for him, and nothing of value was ever paid Hawkins for the release, and at the time McKinley got the release from Hawkins he knew that the vendor's lien note had not been paid. At the time McKinley secured said release from D. W. Hawkins the deed records of Deaf Smith county, Tex., showed that D. W. Hawkins was the owner and holder of said vendor's lien notes, and that D. W. Hawkins had never executed a written transfer of said vendor's lien to the First State Bank & Trust Company of Hereford, nor to any other person; appellant, Davidson, testifying that he did not know anything about anybody having any interest in said note except D. W. Hawkins at the time he got the release, and he thought Hawkins had a right to release the lien. This release was properly executed, acknowledged, and placed of record, and was dated and filed for record October 18, 1910. Appellant never learned, nor was he informed, that any person or the bank had any interest in said notes or the last one until about December 1, 1910, at which time he learned the bank was the owner of said note by indorsement. This case was tried before the district judge without the intervention of a jury, and resulted in a judgment in favor of the appellees, and that appellant take nothing by his suit.

Appellees object to our considering the brief of appellant because the assignments in the brief do not comply with rule 25 (142 S. W. xii) by referring to the errors complained of in the motion for new trial. The brief is defective in this particular, as are a great number of the briefs filed in this court. This court has had occasion several times to call attention to this rule. Attorneys will save themselves much trouble and the court much consumption of time by observing the rules in the preparation of their briefs. We cannot indulge this practice where attorneys have had reasonable time to become acquainted with the amendments. If, however, we disregard the brief of appellant, and look to that of appellees, and to the record, we are forced to the conclusion that there is such fundamental error in the judgment of the court as requires at our hands a reversal of the judgment of the trial court. We shall, therefore, look to the otherwise admirable and able brief of appellant to assist us in our consideration of the case. It is proper to state at this time that the learned judge, before whom the case was tried, has followed the opinion and direction of this court handed down on a former appeal of this case, reported in 146 S. W. 576. We have concluded that this court was in error in that portion of the opinion which held substantially that the indemnitors were released from liability on their contract of indemnity because the bank did not get a written transfer of the lien and have it recorded, and by the execution of the release of the lien by Hawkins, the original vendor of the land and payee in the notes, executed by McKinley to him.

It is so well established that the transfer of a vendor's lien note by the indorsement of the payee therein conveys with it the lien on the land for its security that it would be a useless consumption of time to cite authorities. Moran v. Wheeler, 87 Tex. 179, 27 S. W. 54, so holds. No written transfer is necessary.

Neither is it necessary that it be placed of record. In this case, when D. W. Hawkins transferred the vendor's lien note for $750 to the First State Bank & Trust Company of Hereford, the lien on the land was transferred to the bank, which it had the right to foreclose. The case of Moran v. Wheeler, 87 Tex. 179, 27 S. W. 54, upon which was based the opinion of this court on the former appeal, holds: "Considered as a note, it was not within the statute authorizing the record of instruments, but as a mortgage it was entitled to registration, and must be recorded in order to effect the subsequent innocent purchaser without notice for a valuable consideration, if not mentioned in the deed." In that case the vendor's lien was treated by the court as a mortgage, and it is there said: "In this state assignments of mortgages must be recorded in order to effect subsequent purchasers without notice for a valuable consideration." Such has been the holding of the Supreme...