Folmar v. Beall

• Decision Date: 22 April 1920
• Docket Number: 4 Div. 848
• Citation: 204 Ala. 298,85 So. 540
• Parties: FOLMAR v. BEALL et al.
• Court: Alabama Supreme Court

85 So. 540

204 Ala. 298

FOLMAR v. BEALL et al.

4 Div. 848

Supreme Court of Alabama

April 22, 1920

Rehearing Denied May 27, 1920

Appeal from Circuit Court, Crenshaw County; A.E. Gamble, Judge.

Bill by George A. Folmar against J.H. Beall and others, to declare and enforce a vendor's lien upon certain real estate. From a decree for respondents, complainant appeals. Affirmed.

See also, 75 So. 172.

W.A Gunter and J.J. Mayfield, both of Montgomery, for appellant.

F.B Bricken, of Luverne, and Powell & Hamilton, of Greenville, for appellees.

SAYRE J.

In 1894 Beall & Coston, a partnership composed of J.W. Beall and T.W. Coston, the latter now deceased, were beginning a general mercantile business at Luverne in Crenshaw county. Beall was indebted to the Lehman-Durr Company, a corporation doing business at Montgomery. Beall & Coston needed funds and to raise them, Beall, who owned two lots on the main business street of the town, conveyed them to Beall & Coston, taking a promissory note for the sum of $7,500. The deed contained a recital that grantor did grant, bargain, sell, confirm, and convey the said lots "for and in consideration of the purchase-money note of Beall & Coston, dated April 2, 1894, and due November 1, 1894, for the sum of seventy-five hundred dollars," etc. This recital of an outstanding note for the purchase money carried notice of the vendor's lien to all persons claiming as purchasers. Shorter v. Frazier, 64 Ala. 74; Overall v. Taylor, 99 Ala. 12, 11 So. 738. Coston pledged the note with the Lehman-Durr Company as collateral, primarily to secure Beall & Coston's note of even date for $5,500, and perhaps to secure the personal indebtedness of J.W. Beall though this last fact is only important in an evidential way, as will later appear. The lots, through various mesne conveyances, found their way into the ownership of defendants J.H. and Duke Beall, sons of J.W. Beall. So far as concerns the legal title to the note, the Lehman-Durr Company was dissolved according to the statute in such cases made and provided, and at a sale of its assets Lee H. Weil, as trustee for Lehman, became the purchaser. April 23, 1914, Weil assigned said note to appellant, stipulating that appellant should pay to him one-fourth of any net sum he might be able to collect thereon. No other consideration passed from appellant to Weil. This bill, to enforce an alleged vendor's lien, was filed by appellant on October 3, 1914. On final hearing on pleading and proof the circuit judge, sitting in equity, dismissed the bill.

Appellant's right to maintain a suit on the note is affected by some further facts which should be stated. In the fall of 1894 Beall & Coston sold their stock of goods to appellant, and shortly thereafter the Lehman-Durr Company filed a bill against the parties to that sale, averring that it had been made in fraud of creditors. That suit was settled between the parties June 12, 1896, appellant giving his notes aggregating $3,733.71, and T.W. Coston his for $2,271, to secure the indebtedness of appellant and Beall & Coston to the Lehman-Durr Company, the company agreeing, as appellant states the case, to transfer to appellant's son for appellant's benefit all evidences of debt held by it against Beall & Coston. October 16, 1897, the Lehman-Durr Company filed their bill in the chancery court of Crenshaw against J.W. Beall and T.W. Coston, averring that the note of April 27, 1894, supra, had been transferred to it as collateral security, first, for the payment of an indebtedness of Beall & Coston, and, secondly, for the payment of an individual indebtedness of J.W. Beall, that said note was unpaid, and praying that the property here in suit be sold to satisfy the vendor's lien which it claimed. It was further averred that the Savannah Guano Company, then in possession, claimed an interest in the property, and it was made a party defendant. Pending that cause, the Lehman-Durr Company, July 19, 1898, filed in the chancery court of Crenshaw another bill against the appellant and his children, averring that appellant's notes for $3,733.71 remained unpaid, and praying that the conveyance of his lands, which appellant had made to his children, be set aside and the lands subjected to the payment of the notes. Appellant in this last-mentioned cause, September 16, 1901, filed an amended cross-bill, in which he recited the transaction in which he had executed his notes, averring that the Lehman-Durr Company, in consideration thereof had agreed to transfer and assign to him the $7,500 note here in question, together with all collaterals held for the security of said note, and did transfer and assign to him "certain notes, accounts and evidences of debt due or to become due to said Beall & Coston," held by the company as collateral to the indebtedness of Beall & Coston, but not the $7,500 note aforesaid; that the Lehman-Durr Company falsely represented that said note was held by it as collateral security for the individual indebtedness of J.W. Beall, but not as security for the indebtedness of Beall & Coston, and that, relying upon that representation he had executed the note upon which he was sued. Further, appellant in his cross-bill averred that the Lehman-Durr Company on its bill of October 16, 1897, had obtained a decree condemning the lots in question to the satisfaction of its alleged vendor's lien. The prayer of appellant's cross-bill was that his notes for $3,733.71 be canceled, or that the $7,500 note be transferred to him on payment of the notes for $3,733.71, or that the Lehman-Durr Company be required first to exhaust the security of the said $7,500 note and apply the proceeds to the satisfaction of his notes before proceeding further against him. There was a decree in that cause, which was reviewed in 147 Ala. 472, 41 So. 750.

Appellant in the present cause is content to dispose of the litigation commenced on July 19, 1898, by saying that thereby he got a decree settling his right to the note for $7,500, citing Folmar v. Lehman-Durr Co., 147 Ala. 472, 41 So. 750. That would be a highly important statement, if true. It would establish his legal and equitable right to the note formally transferred to him by Weil on April 23, 1914. But the decree in that cause established no such ownership in appellant. Notwithstanding the chancellor had sustained a demurrer to the present appellant's cross-bill in that case, he was of opinion, and so stated, that the cross-bill was incapable of amendment, and that he would consider it as stricken, and proceed to a final decree on the pleadings and evidence, which had been taken without waiting to afford an opportunity to amend, citing Kilgore v. Redmill, 121 Ala. 485, 25 So. 766. And so he did. It is true that the opinion of the court on the appeal which followed speaks of the effect of the evidence; but its statement of the effect of its ruling was in this language:

"This case will therefore be reversed, in order that the chancery court may require the complainant [the Lehman-Durr Company] to give the respondent Geo. A. Folmar the benefit of said collateral by requiring it to exhaust the $7,500 before collecting from him any part of the debt of Beall & Coston that is included in the amount claimed under the original bill."

The further history of the cross-bill in that cause is not shown by the record in this. If there were further proceedings, we can only assume that they were had in accordance with the opinion and decree of this court. Whatever else the court may have decreed, it could not cancel the note which appellant had executed without ipso facto destroying his alleged right to the note for $7,500, for if the contract of compromise and settlement between appellant and the Lehman-Durr Company was to be rescinded at all,...