Givens v. Carter

• Decision Date: 06 April 1912
• Citation: 146 S.W. 623
• Parties: GIVENS et al. v. CARTER et ux.
• Court: Texas Court of Appeals

146 S.W. 623

GIVENS et al. v. CARTER et ux.

Court of Civil Appeals of Texas. Dallas.

April 6, 1912.

Rehearing Denied April 20, 1912.

Appeal from District Court, Hill County; C. M. Smithdeal, Judge.

Action by H. W. Carter and wife against John C. Givens and another. Judgment for plaintiffs, and defendants appeal. Affirmed.

N. J. Smith and A. P. McKinnon, both of Hillsboro, for appellants. Morrow & Morrow, of Hillsboro, for appellees.

RAINEY, C. J.

Appellees, H. W. Carter and wife, brought this suit against appellants, John C. Givens and G. W. Boyd, to recover on three promissory notes and to foreclose the vendor's lien on a certain parcel of land for which said notes were executed. It was alleged, in effect: That said land was the separate property of Mrs. Carter, and it was conveyed by her and her husband to John C. Givens. He executed his notes therefor, which notes were made payable to the order of H. W. Carter, and to secure the payment of which a lien was reserved in the deed and so specified in the notes. That G. W. Boyd had fraudulent possession of said notes, and as against him they sought to recover possession of same. Boyd answered that he obtained possession of said notes for a valuable consideration, and without notice of any adverse claim of Mrs. Carter, through Champ and S. Carter, to whom said notes had been indorsed by H. W. Carter; that he bought one of the notes outright, and the other two he held as collateral to secure a laundry contract made by him and Champ and S. Carter. H. W. Carter and wife by supplemental petition set up: First, that Boyd was a purchaser with notice, because the deed records of Hill county showed that the land for which the notes were given was the separate property of Mrs. Carter and that the notes given in consideration therefor were her separate property; second, that Boyd during the making of the laundry contract had actual notice that the notes were indorsed by H. W. Carter to Champ and S. Carter, without a money consideration, for the purpose only of enabling Champ and S. Carter to secure the laundry contract; that the sale of one of the notes was without authority from appellees; that said last contract was entered into without the knowledge of appellees; and that they have not since acquiesced nor ratified the same. Givens answered admitting that he executed the notes as charged; that by the terms of the notes he had the right to pay off same at any time on or before maturity; that he has been ready and willing to pay same to either claimant as may be determined by the court; that by reason of the conflicting claims of ownership he has been compelled to employ an attorney at the expense of $100 to protect his interest and asked judgment over against Boyd for same. The cause was submitted to the jury on special issues, as follows: "Did Boyd have actual notice that Mrs. M. E. Carter claimed the three notes in question as her separate property at the time he took the same from Champ and S. Carter?" To this the jury answered in the negative. Second, in effect, "Did Boyd have notice such as would put a reasonably prudent person on inquiry that the notes were the separate property of Mrs. M. E. Carter?" To this the jury answered in the affirmative. Third, in effect, "Before the contract was made in which the three notes in question were first placed with G. W. Boyd as security, did Champ Carter tell G. W. Boyd in substance that the three notes were delivered to him only for the purpose of being used to guarantee the faithful performance of the contract on the part of Champ and S. Carter?" To this the jury answered in the affirmative. Boyd and Givens excepted and gave notice of an appeal and bring the case here for review.

Mrs. Carter, the wife of H. W. Carter, owned a tract of land in Hill county, in her separate right. She and her husband conveyed this land to John C. Givens in consideration of three notes for $1,000 each, payable to the order of H. W. Carter, in Hillsboro, Tex., on or before January 1, 1913, 1915, and 1917, respectively. A lien was reserved in the deed to secure the payment of said notes. Said deed was duly recorded in Hill county. Champ and S. Carter, sons of H. W. Carter and wife, resided in Mangum, Okl., as did G. W. Boyd. Said Champ and S. Carter rented from Boyd a laundry in Mangum with option of purchasing same for a certain consideration and placed with Boyd the said three notes as collateral to secure the performance of said contract; said notes having been indorsed by H. W. Carter and transferred to them for that purpose, of which Boyd was informed before the laundry contract was consummated. Boyd also before receiving the notes had his agent examine the records of Hill county and thereby received notice of the contents of the deed. The notes recite that they were given for the land and that a lien was reserved in the deed to secure their payment. After using the laundry for a while, Champ and S. Carter, becoming fearful they would lose money by continuing to operate it with Boyd's consent, traded the laundry for a tract of land. The land was deeded to Champ Carter for the expressed consideration of $6,500, for which he executed his notes payable to Boyd. To secure this last transaction the two notes here in suit and theretofore held by Boyd were to be retained by him as security for the payment of the $6,500 as per agreement; one of the notes having been bought outright by him. The true consideration for the land received for the laundry was $6,000; the note for $6,500 executed by Champ Carter including $500 for rent due on the laundry and other matters to Boyd. Mrs. Carter never...