First Southern Properties, Inc. v. Vallone, 16374

• Decision Date: 03 April 1975
• Docket Number: No. 16374,16374
• Citation: 523 S.W.2d 92
• Parties: FIRST SOUTHERN PROPERTIES, INC., Appellant, v. Vince VALLONE, Receiver, Appellee. (1st Dist.)
• Court: Texas Court of Appeals

Page 92

523 S.W.2d 92

FIRST SOUTHERN PROPERTIES, INC., Appellant, v. Vince VALLONE, Receiver, Appellee.

No. 16374.

Court of Civil Appeals of Texas Houston (1st Dist.).

April 3, 1975.

Tita, Lackshin & Nathan, Herbert N. Lackshin, B. K. Watson, III, Houston, for appellant.

Strickland & Gordon, Gerald S. Gordon, Houston, for appellee.

PEDEN, Justice.

Appeal from a judgment in favor of a receiver on his application to set aside a trustee's deed.

The trial court had, on April 11, 1973, appointed a receiver to manage and sell the community assets and property of Mr. and Mrs. Darnell while their divorce case was pending. The receiver filed his oath on May 17, 1973. No bond was required of him. The Darnells had bought the real property made the subject of this suit from the Oxfords, who held the Darnells' deed of trust as security for their promissory note for the purchase price. All monthly payments on the $21,000.00 note had been made through April 1, 1973, when the balance was $7,074.43. On May 1, 1973, the monthly payment then due was not paid. Within 11 days after this default in payment one asserting he was a substitute trustee posted notices of sale; on June 5, 1973 he conducted a substitute trustee's sale and appellant purchased the property for $22,000.00. The receiver brought this suit to have the trustee's deed set aside, and after a non-jury trial the court found for the receiver and ordered return of $22,000 .00 paid for the property by the appellant.

Appellant's first two points of error complain that the trial court erred in entering judgment for the appellee, because appellant was a bona fide purchaser for value without notice and was entitled to prevail on the principle of estoppel.

The parties stipulated that the date when the plaintiff-receiver filed a lis pendens was June 14, 1973.

The appellee's first counterpoint is that the trial court did not err in holding that real property held in custodia legis by a court-appointed receiver cannot be sold by a lienholder under a power of sale, that such a sale is a nullity and a trustee's deed is void.

The trial court's first five conclusions of law were:

1. 'THAT by the appointment of a Receiver therefor, the subject property was in custodia legis at the time of the Substitute Trustee's Sale on June 5, 1973.

2. 'THAT property in possession of a receiver may not be sold by a trustee to satisfy a mortgage or trust deed unless the sale is authorized by the court in which the receivership is pending.

3. 'THAT the purported sale of property in receivership under a power contained in a deed of trust is void.

4. 'THAT the purported sale under a power contained in the deed of trust passed no title.

5. 'THAT the Substitute Trustee's deed is void.'

The appellant argues that since the receiver did not file a lis pendens notice as provided by Article 6640, Vernon's Ann. Texas Civil Statutes, the appellant had no notice that the property in question was involved in a divorce...