Gregg v. First Nat. Bank

• Decision Date: 09 April 1930
• Docket Number: Nos. 1193-5536.,s. 1193-5536.
• Citation: 26 S.W.2d 179
• Parties: GREGG v. FIRST NAT. BANK IN BROWNSVILLE et al.
• Court: Texas Supreme Court

26 S.W.2d 179

GREGG v. FIRST NAT. BANK IN BROWNSVILLE et al.

Nos. 1193-5536.

Commission of Appeals of Texas, Section B.

April 9, 1930.

Error to Court of Civil Appeals of Fourth Supreme Judicial District.

Action by the First National Bank in Brownsville against John Gregg and James A. Browne. The Court of Civil Appeals [18 S.W.(2d) 772] reversed a judgment of the trial court for defendant first named, and said defendant brings error.

Judgment of the Court of Civil Appeals reversed, and the judgment of district court affirmed.

Seabury, George & Taylor and Graham, Graham & Graham, all of Brownsville, for plaintiff in error.

Faulk & Abney, of Brownsville, for defendants in error.

LEDDY, J.

On January 31, 1928, three judgments aggregating over $30,000 were rendered against James A. Browne in the district court of Cameron county, and on the same day they were duly abstracted in the judgment records of said county.

On the 11th day of June, 1928, execution was caused to be issued under each of the above judgments, and the same was duly levied by the sheriff on all the interest in certain specified property of James A. Browne which was devised to him under the will of Agnes A. Browne, deceased.

The property levied upon was sold under three execution sales, John Gregg, who purchased the three judgments against Browne, being the purchaser at each sale under his bids of $4,500, $5,000, and $4,000, the original judgments being credited with these sums less the costs of sales.

On the 25th day of April, 1928, after the above three judgments had been abstracted in the records of Cameron county, the First National Bank in Brownsville obtained a judgment against James A. Browne for the sum of $1,674.70, and caused the same to be properly abstracted in the records of said county.

In December, 1928, said bank filed this suit in the district court of Cameron county against John Gregg and James A. Browne, in which it sought to set aside the three execution sales and to subject said property to its judgment, the ground of its action being that the interest of James A. Browne in the estate of Agnes A. Browne, deceased, was sold as a whole, and not in parcels, and by reason thereof the property sold for a grossly inadequate price. It was also averred by the bank that under the will of Agnes A. Browne the property levied upon and sold to John Gregg was in the hands of the executrix under an active trust for the handling, partition and conveyance of all the real estate, and the interest of James A. Browne therein, and that the sale of the land under execution during the continuance of said trust was void.

The trial court rendered judgment against the plaintiff bank and in favor of John Gregg, upholding the validity of the three execution sales and quieting the title acquired by Gregg thereunder.

The Court of Civil Appeals (18 S.W.(2d) 772) reversed the judgment of the trial court, holding that the property was not subject to execution because the same was in the hands of the executrix to be administered and was, therefore, in custodia legis.

Defendant in error frankly concedes in this court that the decision of the Court of Civil Appeals cannot be upheld on the ground that the property was not subject to execution because in custodia legis. It contends, however, that what the Court of Civil Appeals intended to hold was that the property was not subject to seizure and sale under execution because the will of Agnes A. Browne created an active trust, the administration of which would be interfered with if the interest of James A Browne should be subjected to sale under execution.

This property belonged to the testatrix. She did not owe the judgment creditors of James A. Browne anything and therefore had the legal right to dispose of her property on such terms and conditions as she desired, free from any interference by such creditors. If her will created an active trust, as to the interest of James A. Browne, the courts will not permit a judgment creditor to interfere with the administration of that trust by subjecting the property of the cestui que trust to execution. Whether Browne's interest was subject to execution is dependent upon whether the property devised to him was, in fact, subject to an active trust under the will. The pertinent provisions of said will are as follows:

"First: I will and direct that all my debts be paid out of my estate, as soon as convenient, by my executrix, hereinafter named.

"Second: I hereby devise and bequeath to each of my four children, James A. Browne, Irene Mason, S. P. Browne, and Mary Smith, an equal one-fifth interest in all property of every nature owned by me at the time of my death.

"Third: I hereby direct my Executrix, hereinafter named, as soon after my death as convenient, to pay all my just debts and to divide the remainder of my property, after payment of such debts, into five shares as nearly equal as may be, and to deliver and convey to each of my four children, above named, one of said shares, or a one fifth of said property * * * (balance of paragraph refers to interests of grandchildren).

"Fifth: I hereby nominate and appoint my daughter Irene Mason, wife of O. K. Mason of Brownsville, Texas, as Executrix of this Will, and direct that no bond or other security be required of her, as such Executrix, and that no action be had in the Probate, or other Courts, than to prove this Will and file an inventory and appraisement of my estate and list of claims."

At the time of the execution sale under which John Gregg acquired title to the interest devised to James A. Browne, all of the debts of the estate had been paid and nothing remained to be done by the executrix except to divide the estate into five equal portions and convey four of the same to the children mentioned in the second paragraph of the will; the remaining portion, which was devised to the grandchildren, was to be held in trust in accordance with the terms of said will.

The will of Agnes A. Browne unquestionably gives James A. Browne an undivided one-fifth interest in all the property owned by...