Howard v. Stahl

• Decision Date: 16 April 1919
• Docket Number: (No. 1475.)
• Citation: 211 S.W. 826
• Parties: HOWARD et al. v. STAHL et al.
• Court: Texas Court of Appeals

Page 826

211 S.W. 826

HOWARD et al. v. STAHL et al.

(No. 1475.)

Court of Civil Appeals of Texas. Amarillo.

April 16, 1919.

Rehearing Denied May 14, 1919.

Appeal from District Court, Sherman County; R. E. Stalcup, Special Judge.

Action by Earl De Ford against J. E. De Ford and B. C. Howard, in which J. E. De Ford and J. H. H. Stahl were successively substituted as parties plaintiff, and in which S. E. Gates and another were made parties defendant. From a judgment in favor of J. H. H. Stahl against B. C. Howard and S. E. Gates and another, B. C. Howard appeals. Affirmed in part, and reversed and rendered in part.

W. I. Gamewell, of Stratford, for appellant.

Tatum & Strong, of Dalhart, and J. H. H. Stahl, of Stratford, for appellees.

HALL, J.

On November 15, 1917, Earl De Ford sued J. E. De Ford and B. C. Howard, alleging: That on or about the 1st day of July, 1908, for value, defendant J. E. De Ford executed and delivered five certain promissory notes of date July 1, 1908, payable to the order of himself and by him indorsed in blank and negotiated, each of said notes being for the sum of $232, bearing 6 per cent. interest from date and maturing respectively January 1, 1909, 1910, 1911, 1912, and 1913. That said notes were executed in part payment for the N. E. 1/4 of section 3, block No. 2, public free school lands in Sherman county, Tex., which had been conveyed to J. E. De Ford on July 1, 1908. That on said 1st day of July, 1908, the said J. E. De Ford executed and delivered to W. M. Sparrow as trustee a certain deed of trust on the above-described land to secure payment of said notes as additional security to the vendor's lien reserved thereon. That thereafter said notes, for value, were transferred and delivered to S. E. Gates, who became the legal and equitable owner and holder thereof, and, while such holder, notes Nos. 1 and 2 were paid. That thereafter, on account of default in the payment of the remainder of said notes, the said S. E. Gates undertook to sell said land under and by virtue of the authority and power of sale contained in said trust deed, and by and through Reese Tatum, as substitute trustee, the original trustee having failed and refused to act, and the said Tatum having been appointed substitute trustee, by virtue of authority contained in the deed, that the said land was sold on the first Tuesday in March, 1917, at which sale J. E. De Ford became the purchaser thereof, whereupon a trustee's deed was executed by the said substitute trustee and delivered to the said J. E. De Ford. Plaintiff alleges that, if the said trustee's sale was not legally made for any reason, he, having paid off and discharged the indebtedness, is subrogated to all the rights, liens, and equities held by said Gates prior to the time of the sale and is entitled to have said liens foreclosed to satisfy said debt; that B. C. Howard is asserting some kind of an interest or title in and to said property; that the debt above referred to is past due and unpaid; that payment thereof has often been refused; and that plaintiff is entitled to a decree for the amount of the debt, interest, and foreclosure of the lien. There is a prayer for judgment for the amount of the debt, foreclosure of the liens, as they existed on the 1st day of July, 1908, with writ of possession, and for personal judgment against J. E. De Ford.

On January 15, 1918, there was filed what is termed, "Second Amended Original Petition and First Amended Intervening Petition, and First Amended Original Answer, of J. E. De Ford." The substance of the allegations is that the suit having been filed with Earl De Ford as sole plaintiff, by and through the joint efforts of Frank M. Tatum and John H. H. Stahl, upon the authorization, presumed or actual, of Earl De Ford, who as the agent of J. E. De Ford received the notes described herein, with authority to bring the suit but in the name of J. E. and not Earl De Ford, and to allege the ownership of said notes and lien correctly and not otherwise, in the name of J. E. De Ford and not Earl De Ford, who owns no interest in them whatever, and who had no interest except as agent for J. E. De Ford, said agency has been terminated by the call of Earl De Ford to the army; that the said J. E. De Ford, being a resident of Warren county, Iowa, alleges that the intention of the said attorneys was to file the suit and to represent as attorneys of record in the prosecution thereof J. E. De Ford, but that they became confused as to the real party in interest, not knowing whether it was Earl De Ford or J. E. De Ford who owned the notes; that they were in error and made the mistake by reason of the fact that the employment of attorneys to represent J. E. De Ford was made by Earl De Ford, who was an attorney of Des Moines, Iowa. He prays that he be made the real plaintiff in lieu of Earl De Ford, who appears as plaintiff in the original petition, which was filed through mistake of the attorneys employed to represent him by Earl De Ford. He prays in the alternative that, if he cannot be substituted as plaintiff, the suit upon the notes be prosecuted in the name of Earl De Ford as trustee for his benefit. This pleading further sets up the cause of action substantially as alleged in the original petition, and in addition thereto proceeds as follows:

"That S. E. Gates and Edith Gates are made defendants and relief asked against him on the contingency that this plaintiff should fail on trial hereof to have his title to said land quieted against defendants, and all of them, and should also fail to secure a foreclosure of the said notes and liens, and in that event he alleges that he and the said S. E. Gates and Edith Gates were on unequal terms in the said sale, and he would not have bought said land in had it not been for the fact that he relied on S. E. Gates and the substitute trustee that the foreclosure of said trust deed under power of sale was valid, and that if he bought said land in order to purchase same he would have to get good title to said land. That he was not obligated to pay said notes, nor to pay whatever amount they exceed the value of the land, because when he put said liens on said land, and then afterwards sold it, a part of the consideration was that the grantee take the land subject to the notes and liens, and therefore having no knowledge but what the foreclosure out of court was legal, bought in said land, which was then, and is now, fully of value equal to the amount due on said notes, and therefore having held, or caused to be held, a sale of said land, which passed no title to him (if such be the finding of the court), plaintiff in that event is entitled to recover of S. E. Gates or Edith Gates, whichever own these notes, the full amount paid by J. E. De Ford, this plaintiff at the sale, with 6 per cent. interest thereon to date, per annum, and accordingly on the contingency stated he asked for judgment against them."

The prayer in this pleading is the same as in the original petition, and in the alternative that, in the event his title to said land under the trustee's sale is invalid, void, voidable, or cannot be quieted, then for judgment against S. E. Gates and Edith Gates.

On December 31, 1917, defendant B. C. Howard filed his answer and cross-bill, setting up the execution of the notes, deed, and deed of trust by J. E. De Ford on July 1, 1908. He alleged the conveyance of the land by J. E. De Ford and wife to Wm. F. Langley, on February 24, 1910; a conveyance by Langley and wife to Ed G. Sheldon, trustee, on January 11, 1911; a conveyance by Sheldon as trustee on June 3, 1911, to Carl G. Higgins; a conveyance by Higgins on June 26, 1911, to Geo. W. Poynter. It is further alleged that on March 6, 1917, Reese Tatum, as substitute trustee, made a purported sale of the land in controversy, attempting to convey same to J. E. De Ford, and that said sale was illegal. It is alleged that said purported sale was made more than four years after the maturity of the indebtedness evidenced by the notes sued on. On January 29, 1918, J. H. H. Stahl filed his petition in intervention as the assignee and transferee of J. E. De Ford and Earl De Ford, of the cause of action asserted by them in the suit, and as the owner of all interest asserted by the De Fords in the land in question. He adopts the pleadings filed by Earl and J. E. De Ford, together with the prayer for relief therein contained. By supplemental answer filed July 15, 1918, defendant Howard specially alleges that at the time of the trustee's sale on the first Tuesday in March, 1917, the notes described in plaintiff's petition were more than four years past due; that at the time of the filing of this suit by the rightful owner of said cause of action, whether same be J. E. De Ford or J. H. H. Stahl, the time for the filing of a suit to arrest the running of the statute of limitations or to preserve or foreclose the lien had expired; and that the rights of plaintiff and defendants J. E. De Ford and Stahl became forfeited; and specially pleads the statute of limitations. Vernon's Sayles' Civ. St. arts. 5693, 5694, 5695. By order duly entered, the court permitted J. E. De Ford to intervene as sole plaintiff. Upon his plea of intervention filed January 7, 1918, the court also permitted J. H. H. Stahl, as assignee of Earl and J. E. De Ford, to intervene as sole plaintiff. This order bears date July 15, 1918. At the July term, 1918, of the court, S. E. Gates entered his appearance in writing, in which he includes a general denial of the allegations in J. E. De Ford's second amended original petition. There was a trial before the court without a jury, resulting in a judgment which recites that J. E. De Ford is entitled to recover as prayed for in his second amended original petition; that J. H. H. Stahl being the sole plaintiff, and having been substituted, recover of and from the defendant Howard the land in question. It was further decreed that S. E....