Home Owners' Loan Corporation v. Netterville
| Decision Date | 11 October 1939 |
| Docket Number | No. 2260-7366.,2260-7366. |
| Citation | 132 S.W.2d 93 |
| Parties | HOME OWNERS' LOAN CORPORATION v. NETTERVILLE et ux. |
| Court | Texas Supreme Court |
Suit in trespass to try title by V. B. Netterville and wife against the Home Owners' Loan Corporation. The defendant filed a cross-action. To review a judgment of the Court of Civil Appeals, 110 S.W.2d 628, affirming the judgment of the district court, the defendant brings error.
Reversed and remanded, with instructions.
Tom Kenna, Lipscomb & Lipscomb, and Samuel Lipscomb, all of Beaumont, James I. Perkins, F. A. Stamper, and W. E. Dyche, Jr., all of Houston, and J. W. Timmins and T. L. Foster, both of Dallas, for plaintiff in error.
Geo. E. Holland and W. S. Nichols, both of Beaumont, for defendants in error.
GERMAN, Commissioner.
On October 10, 1925, J. S. Edwards and others executed to O. B. Netterville deed to a triangular tract of land fronting 332 feet on Pine Burr Boulevard in the City of Beaumont, Texas. Said tract contained 1.02 acres, and when convenient will be referred to as 1 acre. The deed recited a cash consideration of $80 paid by O. B. Netterville, and the execution of one note for $320 by said O. B. Netterville, payable in monthly installments of $8 each. This deed was filed for record October 15, 1925. Shortly after said deed was executed, V. B. Netterville, the father of O. B. Netterville, built a house on said tract of land near the middle of the 332 foot line, and facing the Boulevard. V. B. Netterville and wife, upon the completion of said house, moved into same and have since occupied same as their home.
On April 19, 1926, O. B. Netterville, in whose name the record title to said 1 acre tract stood, desiring to build a home for himself upon said land, entered into a contract with his father, V. B. Netterville, for the construction of said house. This contract created a mechanic's, materialman's and contractor's lien upon the whole of said tract in favor of V. B. Netterville. O. B. Netterville executed one note for $1580, payable to V. B. Netterville in monthly installments of $24 each. This note included a balance of $282.36 of the original purchase money note. A. L. Carter Lumber Company furnished the lumber and materials for the construction of the house, and on the 19th day of April, 1926, V. B. Netterville assigned to said company said note, as well as the mechanic's, materialman's and contractor's lien securing same. This note was finally paid in full, and on November 28, 1932, the lumber company released said lien.
Prior to December 27, 1929, C. K. Netterville, a son of V. B. Netterville, and brother of O. B. Netterville, was living with his father on the land in question. Being desirous of building a home thereon, at the request of his father and mother, who desired to make a gift of a part of said land to the said C. K. Netterville, O. B. Netterville executed to the said C. K. Netterville a deed to the western portion of said 1 acre tract, leaving a tract fronting 112 feet on said Boulevard standing in the name of the said O. B. Netterville. The O. B. Netterville home was upon this tract. The portion conveyed by O. B. Netterville and wife to C. K. Netterville included the house in which V. B. Netterville and wife resided. The tract thus conveyed was approximately one half of the original lot, and when convenient will hereinafter be referred to as the one half acre tract. This deed was filed for record December 29, 1929.
On December 27, 1929, C. K. Netterville, who was then a single man, entered into a contract with his father, V. B. Netterville, to construct a dwelling house upon said one half acre tract, and said contract created a mechanic's, materialman's and contractor's lien in favor of said V. B. Netterville upon all of said tract conveyed by O. B. Netterville to C. K. Netterville, including the house in which the said V. B. Netterville resided. This lien was given to secure payment of one note for $1860, payable in monthly installments of $24 each, executed by the said C. K. Netterville to the said V. B. Netterville. The A. L. Carter Lumber Company furnished the lumber and materials used in the construction of this house, and on the 27th day of December, 1929, V. B Netterville assigned said note and said lien to said lumber company. For the better securing of said note the said C. K. Netterville, on the same date, executed deed of trust lien in favor of said lumber company, naming C. E. Locke as trustee. The house was built for C. K. Netterville, and he moved into same in January, 1930, having in the meantime married. This house was located a short distance west of the house occupied by V. B. Netterville and wife. C. K. Netterville defaulted in payments on his note, and on June 6, 1933, the trustee, at the request of A. L. Carter Lumber Company, made sale of the land covered by the deed of trust, and the lumber company became the purchaser. This sale included the land where the house occupied by C. V. Netterville and wife was located. It does not appear that any one questioned the regularity of this sale. Both V. B. Netterville and wife and C. K. Netterville and wife continued to reside upon the land, and it is not shown what agreement, if any, was made between them and the A. L. Carter Lumber Company.
The lumber company continued to hold title to this property until February 1, 1934. It appears that the company was willing to reconvey the property to C. K. Netterville for the amount of the indebtedness which had previously existed against it, provided arrangements could be made with the Home Owners' Loan Corporation to take up the purchase money note by substitution of its bonds for substantially the full amount of said indebtedness. Upon application made by C. K. Netterville, the Home Owners' Loan Corporation expressed its willingness to make the loan. Thereupon A. L. Carter Lumber Company executed to C. K. Netterville a deed to the property, reserving a vendor's lien to secure the payment of one note for $2293.15, payable in monthly installments of $25 each. This deed was dated February 1, 1934. On April 10, 1934, the lumber company, for a consideration of $2321 in bonds of the Home Owners' Loan Corporation, assigned the note and lien to said corporation. To further secure the said sum, C. K. Netterville and wife executed a deed of trust in favor of the corporation. In making this loan the Home Owners' Loan Corporation required the furnishing of an abstract of title, and same was examined by its attorney. It is undisputed that said attorney relied upon the records as disclosed by said abstract, and from such records concluded that the title to the property in question was good in C. K. Netterville. There is some proof that the company sent an inspector to view the property, and that he inspected only the house where C. K. Netterville and wife resided, but made no inspection of the house where V. B. Netterville and wife lived. It is further undisputed that there has never been any subdivision of the one half acre tract as between C. K. Netterville and V. B. Netterville, but of course the deed of conveyance from O. B. Netterville to C. K. Netterville had the effect of segregating the O. B. Netterville portion from the balance of the tract. There was no fence, hedge or other visibly marked division line between the improvements of C. K. Netterville and V. B. Netterville.
The present suit was instituted in the District Court of Jefferson County by V. B. Netterville and wife as plaintiffs, and they will be so designated here. It was a simple action of trespass to try title, and by same plaintiffs sought to recover title and possession of the said one half acre tract as described in the deed by O. B. Netterville to C. K. Netterville. The Home Owners' Loan Corporation, which will be designated defendant, answered by general demurrer, general denial and plea of not guilty, as well as by alleging the various transactions herein mentioned. By way of cross action it sought to foreclose as against C. K. Netterville and wife and V. B. Netterville and wife the vendor's lien and deed of trust lien hereinbefore mentioned.
In their suit of trespass to try title plaintiffs relied solely upon an equitable title. It is their claim that when the land was purchased by O. B. Netterville in 1924 it was bought for the joint benefit of O. B. Netterville and V. B. Netterville. It is further claimed (all of which was shown by parol evidence) that V. B. Netterville paid all or a part of the cash payment of $80 and made some payments on the monthly installments represented by the note of O. B. Netterville to A. L. Carter Lumber Company, which...
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