Appeal from district court, Dallas county; Edward Gray, Judge.
LIGHTFOOT, C. J.
In this case the court below sustained the demurrer of appellees to the pleading of plaintiffs. The charging part of plaintiffs' petition, after alleging the names of parties and that the property in controversy was their homestead, is as follows: "On April 25, 1894, the defendant the National Loan and Investment Company of Detroit, Michigan, instituted suit in the district court of the Forty-Fourth judicial district of Texas, for Dallas county, and against John W. Dixon, upon an alleged bond in the sum of $7,000, dated November 1, 1892, and for the foreclosure of a mortgage claimed to have been executed, to wit, by plaintiff John W. Dixon, upon the homestead property hereinbefore described, to secure said $7,000 bond, and to cancel a certificate of stock issued by it to said John W. Dixon for thirty-five shares of stock in said company, which it claimed to hold also as collateral security for the payment of said $7,000 bond. To this suit your petitioner Mrs. W. A. Dixon was not made a party, nor is it claimed or pretended that she was in any way connected with said transactions, or in any manner bound thereby. Such proceedings were had in said suit that on the 24th day of November, 1894, judgment was taken against said John W. Dixon for the sum of $3,985.95, with interest from date at the rate of 6 per cent. per annum until paid, together with the costs, and for foreclosure of said mortgage, and for the sale of said lots Nos. 1 and 2; and petitioner Mrs. W. A. Dixon is informed, though she had no notice thereof, that on the 5th day of February, 1895, a sale was had of said property under said judgment, at which sale the defendant the National Loan and Investment Company of Detroit became the purchaser at the small price of $300. She is further informed, and so charges, that the said defendant is about to take steps under said purchase, by writ of possession or otherwise, to forcibly eject petitioners and their family from the possession of said property,—their homestead, —as already hereinbefore stated; and petitioners charge that said defendant will immediately take such unless enjoined by your honor. Your petitioners charge that said proceedings are illegal, unjust, and not binding upon them or either of them; that Mrs. W. A. Dixon, the wife, has never in any way parted with her homestead rights in said property, or waived the same, nor has she ever conveyed the same, or joined in any conveyance thereof whatever. And petitioners distinctly charge that until this is done their homestead rights, and especially the homestead right of petitioner Mrs. W. A. Dixon, remained unimpaired and in full force and effect, and that the defendant company acquired no right or title to the same, and has no right to interfere with or deprive them of the peaceable use, occupation, and ownership thereof. Petitioners further show that they are informed that said defendant company does not claim that the consideration for the bond for $7,000 was really $7,000, but only claims that it was $3,500, which it agreed to loan and advance to John W. Dixon; but it further falsely claims that said $3,500 was for part of the purchase money of said real estate, then and now the homestead of petitioners. Petitioners deny that as much as $3,500 was ever loaned and advanced by said company to John W. Dixon, of which, however, more will be said hereafter in this petition. And petitioners specially deny that the $3,500 was loaned and advanced as part of the purchase money of said real estate. Said real estate was at the time the homestead of the petitioners, and the title was in them, which fact was well known to the defendant and to John A. Renchard, its agent. It is true that there was an incumbrance of $500 on each of said lots 1 and 2, which incumbrance petitioner John W. Dixon desired to remove, in order that said homestead might be free from debt, and so used by his family. And this fact was seized upon by the defendant company, and the proposed removal of said small incumbrance suggested as a means or instrument to induce the said John W. Dixon to procure from defendant the loan of
$3,500, as is fully hereinafter set out; the real object of defendant and its said agent being to procure said John W. Dixon to enter the said usurious transaction, with the intention and effect that the defendant company would thereby make a usurious loan to said John W. Dixon, and secure the same by a mortgage on the homestead, in violation and evasion of the constitution and laws of this state. The said defendant company and its agent represented to said John W. Dixon that these lots being homestead property, a loan could not be secured upon them, and suggested the following scheme or device: That the liens subsisting on said lots should be foreclosed, and at such foreclosure sale the deeds would be made by consent to said John A. Renchard, defendant's agent; that then the said Renchard would convey back under said pretended sale to said John W. Dixon, upon a pretended consideration of $3,500, payable to the defendant company, and a lien retained therefor on the conveyance. The foregoing was the distinct understanding and agreement in advance on the part of the defendant company upon which the loan and advance would be made to said John W. Dixon; and it was further required by said company that said John W. Dixon should become a member of said company, and a stockholder therein, which was accordingly done. The scheme above set forth was fully consummated, and the papers necessary thereto, including the $7,000 bond, and the mortgage to secure the same were executed. And it is distinctly charged that the whole transaction and the whole consummation thereof was intended to be a loan, and was nothing but a loan to John W. Dixon, and not a sale to him of said property, and was not purchase money for the same. In carrying out the above scheme the following deeds were executed in regard to the property, to wit: (1) From M. J. Dart, trustee, to J. B. Watkins, recorded in Records of Deeds, etc., for Dallas county, Vol. 157, page ___, deed to lot No. 1, and dated July 6, 1892. (2) From same to same to lot No. 2, recorded in Vol. 157, page 383, Dallas county Records of Deeds, etc., dated July 6, 1892. (3) From J. B. Watkins to John A. Renchard to lots No. 1 and No. 2, recorded in Vol. 161, on page 471, Records of Deeds, etc., for Dallas county, and dated November 25, 1892. (4) From John A. Renchard to John W. Dixon to lots No. 1 and No. 2, recorded in Vol. 166, page 148, Records of Deeds, etc., for Dallas county, dated November 1, 1892. (5) Perhaps from Ben E. Cabell, sheriff, to the defendant company, recorded in book ___, page ___, Dallas county Records of Deeds, etc. Whether said last-named deed has been executed or not petitioners are not fully advised. The judgment and foreclosure proceedings in regard to said $7,000 bond and mortgage have already been hereinbefore described. All the foregoing were the result of the device and scheme of the defendant company as a method whereby the law against the incumbrance of homesteads as a security for loans, and the laws against the taking of usurious interest, might be evaded and set at naught, with a full knowledge of all the facts on the part of the defendant...
