First Interstate Bank of Bedford v. Bland

• Decision Date: 14 May 1991
• Docket Number: No. 2-89-103-CV,2-89-103-CV
• Citation: 810 S.W.2d 277
• Parties: FIRST INTERSTATE BANK OF BEDFORD, Appellant, v. Vernon E. BLAND, Appellee.
• Court: Texas Court of Appeals

Page 277

810 S.W.2d 277

FIRST INTERSTATE BANK OF BEDFORD, Appellant, v. Vernon E. BLAND, Appellee.

No. 2-89-103-CV.

Court of Appeals of Texas Fort Worth.

May 14, 1991.

Law, Snakard & Gambill, Steven D. Goldston, Fort Worth, for appellant.

Kenneth G. Mahaffey, Decatur, for appellee.

Before FARRIS, LATTIMORE and MEYERS, JJ.

OPINION

LATTIMORE, Justice.

Appellant, First Interstate Bank of Bedford, f/k/a Allied Bank Bedford ("Bank"), defendant below, appeals a judgment rendered in favor of appellee, Vernon E. Bland. The jury found that a certain tract of land was appellee's homestead and the trial court declared appellant's deed of trust lien on said land was void.

We affirm.

Appellee brought suit seeking an injunction against appellant to prohibit foreclosure on the Alvord property. Appellee also asserted a claim under the Deceptive Trade Practices Act ("DTPA"), TEX.BUS. & COM.CODE ANN. §§ 17.41-17.63 (Vernon 1987 and Supp.1991), based upon alleged misrepresentations by Nick Griffin, former vice president of the Bank. Additionally, appellee sought a determination under the Uniform Declaratory Judgments Act as to the validity of the deed of trust relied upon by appellant. TEX.CIV.PRAC. & REM.CODE ANN. §§ 37.001-37.011 (Vernon 1986 and Supp.1991). Appellant defended on the ground that appellee was estopped to assert a homestead claim because appellee engaged in a conspiracy to defraud appellant. Appellant also asserted counterclaims for fraud, judicial foreclosure, and the balance due on the renewal note dated February 7, 1986. The judgment signed on February 2, 1989 disposed of the claims as follows: (1) the Alvord property was found to be the homestead of appellee; (2) appellant's lien was declared void; (3) appellant was permanently enjoined from foreclosing on the void lien; (4) appellant recovered the balance due on the 1986 note from Vernon S. Bland and Gerda Bland (third-party defendants not a party to this appeal); and (5) all other claims were denied.

In February, 1979, appellee and Dan Davis purchased twelve acres of land outside Alvord, Texas. The property was listed in Dan Davis's name. In July of the same year, appellee moved his travel trailer onto the property, had a well dug, and got his electricity connected. Appellee sold his other property at the time he moved onto the Alvord property. In October of 1981, appellee began building a permanent home on the site. Appellee actually moved into the new home in June or July of 1982, prior to completion.

Appellee's son, Vernon S. Bland, moved to Texas in October of 1980. His spouse, Gerda Bland, followed in 1981. In November of 1981, they opened a travel agency in Fort Worth. Appellee began to see his son on a regular basis in 1984. At some point during the early months of 1984, the son and his wife approached appellee for money for their business.

Appellee testified that he went to a bank in Saginaw with his daughter-in-law, Gerda. Appellee went on to testify that during a meeting at the bank, it was suggested to him that he take out a loan against his house and pay off the debts of his son and daughter-in-law, so the bank would be able to work with the travel agency. Appellee testified that he refused to do so. Appellee also testified that he went to another bank with his son, but that there was no discussion of his home in Alvord.

Shortly after these trips to different banks, appellee's son contacted him and indicated he had found a banker who was willing to work with the travel agency, but the bank would require that appellee's home be put up as collateral. Appellee testified that he told his son he would not put up his house as collateral for any loan. Appellee also testified that he told his son that it would be okay if the banker came out and looked at the property.

Appellee testified that in 1982, the taxes on the property had been separated between Dan Davis and himself, so as to represent their respective shares. Appellee contacted the bank holding the note on the twelve acres to see if the bank would be amenable to partitioning the property, so that appellee would have title to four acres, including the lot on which appellee's house was situated. The bank agreed subject to appellee paying off the balance owed on the four acres. A survey was made of appellee's property on February 7, 1984. Appellee testified that he had planned to have the land partitioned and the survey done long before his son mentioned any financial problems. On March 6, 1984, appellee received a warranty deed from Dan Davis on the four acres. The warranty deed listed Vernon Bland as the owner of the four acres.

In March of 1984, Nick Griffin, a vice president of the Bank, came to the Alvord property to make an inspection. Appellee testified that he was present at the time Nick Griffin arrived. Appellee's son was also present during the inspection. Appellee took Griffin on a tour of the house which lasted about thirty minutes. Appellee also testified that at the time of the inspection, the house was ninety percent complete, and he was living in the house. Appellee further testified that he discussed his son's financial problems with Griffin and indicated that he wanted to help his son, but refused to use his house as collateral. Nick Griffin told appellee that this would not be a problem. Appellee testified that they reached an agreement whereby appellee would guarantee loans from the Bank to his son, on a monthly basis, for a period not to exceed one year. If at any time during this period, appellee's son did not meet his obligations, appellee was to be notified so that he could come in and pay off the debt. According to appellee, this was the last time he saw Nick Griffin.

Appellee subsequently received a phone call telling him that some papers were ready. Appellee testified that he believed that these were papers required by the Bank so his son could begin to get the money as appellee and Griffin had discussed. At the title company, appellee signed a "Borrower's Statement," a "Real Estate Lien Note," a "Deed of Trust," and an "Affidavit as to Debts and Liens." These documents were signed on March 16, 1984. All of these documents listed appellee's four acres as the collateral for a $60,000 loan. The borrower on each document was listed as "Vernon Bland and wife Gerda Bland" or "Vernon Bland et ux Gerda Bland." The "Real Estate Lien Note" showed "Vernon Bland and wife, Gerda Bland" as the makers of the note and indicated that each maker was responsible for the entire amount of the note. There were signature lines for Vernon Bland and Gerda Bland at the bottom of the "Real Estate Lien Note" and the "Deed of Trust." Appellee testified that at the time he signed these documents, his was the only signature appearing. No one from the Bank was present when appellee signed the documents.

Appellee received no proceeds from the $60,000 loan. Subsequent to the loan, appellee was told by his son and daughter-in-law that all was going well with the travel agency. Then, in the early part of 1986, appellee was told that the business was having problems. In August, 1986, appellee was given a copy of a notice of foreclosure. The notice indicated that the foreclosure was to occur in two days. Appellee went to the Bank to see Nick Griffin. Appellee learned that Griffin was no longer associated with the Bank. Appellee was told by James Peek, another Bank officer, that appellee's son was three months behind on his loan payments. Appellee testified that he paid approximately $6,000 to stop the foreclosure action.

Appellee made five or six trips to the Bank to see the note paperwork. Appellee testified that the note he was shown was not one he had signed. Appellee then contacted an attorney who suggested appellee get copies of all relevant paperwork. Appellee made copies of documents at the courthouse and also got copies from the title company. One of these documents was a "Real Estate Lien Note" dated February 7, 1986. There was also a "Deed of Trust" dated February 7, 1986. Both of these documents were in the name of "Vernon Bland and wife, Gerda Bland." Appellee testified that he had not signed either of the two documents. Appellee's son, Vernon S. Bland, testified that he in fact signed the 1986 documents. The son also testified that he signed the documents at some location other than the title company. Gerda Bland, the son's wife, testified by deposition that she signed the 1986 documents at the title company and then took the documents to her husband so that he could sign them. James Peek testified that the 1986 note was a renewal and extension of the original 1984 note.

Appellee testified that he was never told that his son and daughter-in-law intended to renew the note in 1986. After discovering the new note, appellee obtained a deed covering the Alvord property from his son and daughter-in-law and recorded the deed. Appellee further testified that he got the deed in order to cloud the title issue, and not because he had ever given his son a deed to the property.

There was additional testimony offered to support appellee's claim that the property in question was his homestead. Charles Wooten, a friend of the appellee, testified that he had assisted appellee in building the house. He also testified that from 1979 until 1982, when the house construction began, appellee had lived in a trailer on the property. Finally, Charles Wooten testified that in March of 1984, one could readily tell someone lived in the house.

A stipulation was read into the record by appellee's counsel. This stipulation contained the testimony that would have been given if Leroy Morris, Tax Collector for the Alvord School District, had testified. The stipulation stated that appellee had claimed a homestead exception on the land in question from 1982 until the time of the lawsuit.

A different story was told by appellee's son, Vernon S. Bland. The son testified that at the time these events...