Humphrys v. Fisher

• Decision Date: 30 December 1949
• Docket Number: No. 12681.,12681.
• Citation: 178 F.2d 846
• Parties: HUMPHRYS v. FISHER et al.
• Court: U.S. Court of Appeals — Fifth Circuit

178 F.2d 846 (1949)

HUMPHRYS v.FISHER et al.

No. 12681.

United States Court of Appeals Fifth Circuit.

December 30, 1949.

Hugh L. Umphres, Jr., Amarillo, Tex., Albert Smith, Amarillo, Tex., for appellant.

B. L. Morgan, Amarillo, Tex., James W. Witherspoon, Hereford, Tex., H. H. Cooper, Amarillo, Tex., J. V. Wheat, Houston, Tex., for appellees.

Before HOLMES, McCORD, and WALLER, Circuit Judges.

WALLER, Circuit Judge.

Appellee, Fisher, bought real estate from appellee, Evans, paying a cash consideration of $3500.00, executing a note in the sum of $4920.00 dated September 25, 1929, with vendor's lien retained, assuming an indebtedness in the principal sum of $3500.00 due Great Southern Life Insurance Company of Houston, Texas, and also assuming an indebtedness in the principal sum of $2100.00 to the First National Company of Temple, Texas.The indebtedness of Evans, so assumed by Fisher, to the Great Southern and to First National Company was each secured by a deed of trust or vendor's lien on the property.

Evans on February 18, 1930, assigned, transferred, and endorsed over to C. M. Humphrys, now deceased, the Fisher note for $4920.00, together with the lien securing same, by a writing duly recorded in the public records of Deaf Smith County.The great drouth and dust storm hit that section during the years of 1932, 1933, and 1934.Fisher became unable to pay the debts that he had assumed or the interest.Resort was had to the Federal Land Bank for the purpose of undertaking to refinance and scale down Fisher's indebtedness.The indebtedness to the Great Southern Life Insurance Company and to the First National Company was prior to, and superior to, the lien securing the indebtedness evidenced by the note held by Humphrys, and in order to refinance these loans the Federal Land Bank agreed to make a loan to Fisher on the lands in question in the amount of $5000.00, secured by a deed of trust on the land, and the Federal Land Bank Commissioner agreed to make an additional loan of $2500.00, provided the note to Humphrys for $4920.00 be scaled down to $750.00 and assigned to him, and provided the balance of the $4920.00 note, as well as the vendor's lien securing same, be released.This was agreed to by Humphrys, and thus it was arranged that Fisher's indebtedness to the Life Insurance Company, to the First National Company, and to Humphrys was refinanced, scaled down, and paid off.In this manner the Federal Land Bank and the agency represented by the Federal Land Bank Commissioner became the holders of the entire indebtedness theretofore held by the Insurance Company, the First National Company, and Humphrys.In the transaction between Humphrys and the Federal Land Bank Commissioner, Humphrys executed and delivered to the Land Bank a transfer and assignment of $750.00 of the vendor's lien note by an instrument of writing containing the following recitation: "Any and all portions of the above described note which is not hereby assigned have been fully paid and the lien securing the payment thereof is hereby released."This assignment was also recorded in the deed records of the county.

Notwithstanding Humphrys' agreement to scale down the indebtedness to the sum of $750.00, which he transferred to the Land Bank, there was caused to be executed to him a new note by Fisher and his wife for the balance of the $4920.00, plus interest, totalling $5560.00.Evans did not endorse this note but subsequently the indebtedness was renewed by the execution of seven notes and those latter notes were endorsed by Evans.Thereafter Humphrys died and the appellant here is the executrix under his will.

Fisher brought this suit, against Humphrys' executrix, seeking a declaratory judgment, asserting that the series of notes were merely renewals of the obligations that existed under the original note of $4920.00, and that although Humphrys had agreed with the Federal Land Bank that all the indebtedness thereunder had been paid and released except the $750.00, he, the said Humphrys, nevertheless required the plaintiff to execute and deliver to him a note of $5560.00 dated April 13, 1934, as well as the seven renewal notes above referred to, which latter notes he also required Evans to endorse; that by reason of the said representations of Humphrys, the Federal Land Bank was induced to refinance plaintiff's indebtedness, and Humphrys was thereby enabled to receive the sum of $750.00 from the Land Bank.Plaintiff asserts that all of these renewal notes were...