Jolly v. Fidelity Union Trust Co.

• Decision Date: 19 January 1929
• Docket Number: (No. 11700.)
• Citation: 15 S.W.2d 68
• Parties: JOLLY v. FIDELITY UNION TRUST CO. et al.
• Court: Texas Court of Appeals

15 S.W.2d 68

JOLLY v. FIDELITY UNION TRUST CO. et al.

(No. 11700.)

Court of Civil Appeals of Texas. Fort Worth.

January 19, 1929.

Rehearing Denied February 23, 1929.

Appeal from District Court, Clay County; Vincent Stine, Judge.

Mortgage foreclosure proceedings for the Fidelity Union Trust Company and others against Pauline B. Jolly. Judgment for plaintiffs, and defendant appeals. Affirmed.

Kay, Akin & Smedley, of Wichita Falls, for appellant.

W. G. Eustis, of Henrietta, for appellees.

DUNKLIN, J.

This is an appeal by Mrs. Pauline B. Jolly from a judgment in favor of the Fidelity Union Trust Company, foreclosing a mortgage lien on certain land in Clay county.

Certain issues presented were by this court certified to the Supreme Court, and the determination by that court appears in 298 S. W. 530, on original hearing, and in 10 S.W. (2d) 539, on rehearing. The material facts involved are cited in those opinions, and no attempt will be made to repeat them further than is necessary to a discussion of other questions not specifically embraced in the certificate to that court.

The principal issue involved was the defense of the statute of limitation urged by Mrs. Jolly to the foreclosure suit by the Fidelity Union Trust Company. As stated in those opinions, Mrs. Jolly executed to her brother, Edward R. Holden, a conveyance of the land for the purpose of enabling him to procure a loan of money, and the note sued on was given for money loaned to Holden and secured by a mortgage on the land. On the same date that Mrs. Jolly conveyed the land to Holden, the latter reconveyed the land to her, but the loan was made and the mortgage taken to secure the same without knowledge on the part of the Union National Bank of New York, the payee, of the reconveyance to Mrs. Jolly.

The decision of the Supreme Court in answer to certified questions was in effect (1) that, as between the maker and the payee of the note, the evidence was sufficient to show a valid and binding extension of the maturity of the note, as contended by the plaintiff in the case, who was the legal owner and holder of the note as the assignee of the payee, the Union National Bank; (2) that, in order to show that the statute of limitation in favor of the estate of Edward R. Holden against any suit by the holder of the note was suspended for less than twelve months under the provisions of article 5538, Rev. Statutes, the burden was upon Mrs. Jolly to prove that an administration was had and an administrator or executor qualified upon the estate of Holden within a shorter period of time than twelve months after his death; and (3) that, if plaintiff's right to recover on the note against the estate of Edward R. Holden was not barred by limitation when this suit was instituted, then there was no bar of plaintiff's suit to foreclose the lien against Mrs. Jolly on the land covered by the mortgage.

There was neither pleading nor proof by Mrs. Jolly or by the plaintiff in the case that there was any legal administration on the estate of Edward R. Holden, or that any one qualified as executor or administrator. It would follow, therefore, from the decision of the Supreme Court, that Mrs. Jolly's plea of limitation to the action was properly overruled; unless it can be said that a different result would follow by reason of other points stressed in her brief and not specifically embraced in our certificate to the Supreme Court.

Appellant argues that, after the land was reconveyed to her by Edward R. Holden, she occupied the relation of surety toward the claim sued upon; that is, the relation of "real suretyship," which is defined in 32 Cyc. p. 22, as follows: "Real suretyship arises where certain specific property can be taken to enforce payment of another's debt, or the performance of some duty owing by another, and the owner of such property, if he would save it, must pay or perform, but he is not personally liable in damages."

It is next insisted that, since Mrs. Jolly's land stood in the relation of surety on the note executed by Holden, then renewal or extension of that note without her consent released her and her property from the mortgage lien theretofore existing against it. Authorities cited by appellant to support that contention include the following: Cason v. Chambers, 62 Tex. 305; Cooksey v. Blair (Tex. Civ. App.) 254 S. W. 509; Westbrook v. Belton National Bank, 97 Tex. 246, 77 S. W. 942; Zapalac v. Zapp, 22 Tex. Civ. App. 375, 54 S. W. 938; King v. Parks, 26 Tex. Civ. App. 95, 63 S. W. 900; Union Mutual Life Ins. Co. v. Hanford, 143 U. S. 187, 12 S. Ct. 437, 36 L. Ed. 118; Durrell v. Farwell, 88 Tex. 98, 30 S. W. 539, 31 S. W. 185. The first two cases cited hold that, if property mortgaged is sold by the mortgagor after the debt is barred by the statute of limitation, then a subsequent renewal of the note does not renew the lien as against the subsequent purchaser without his consent to the renewal. In Westbrook v. Belton National Bank, 97 Tex. 246, 77 S. W. 942, it appeared that the principal on a note, joined by his wife, executed a deed of trust on land which was the separate property of the wife; thereafter a new note was executed by the husband and others as sureties extending the due date, without the consent of the wife. It was held that the property covered by the mortgage was thereby released from the mortgage lien. The court used the following language: "Her property cannot be held as security for a contract essentially different from that to secure the performance of which by her husband she pledged it, any more than a personal surety upon one contract can be held bound upon a different one made without his consent."

In Durrell v. Farwell, 88 Tex. 98, 30 S. W. 539, likewise it was held that the land embraced in the mortgage made by Gage was discharged from liability for the payment of the bonds by the acts of the bondholders and the Presidio Live Stock Company, and in that opinion the following was said: "A surety is bound by the terms of his contract, and his liability cannot be extended beyond it. If the contract be altered without his consent, whether he sustain injury or the contract be to his advantage, it ceases to be his contract, and with that ceases his obligation" — citing authorities.

It is well settled that the reason why a surety is discharged by an extension or renewal of a debt without his consent is that the new contract is not his and therefore he is not bound by it; the suit being to enforce a new contract and not the old one, the rule of strictissimi juris being applicable in favor of the surety. See, also, 21 R. C. L. pp. 975, 984, and 1004. To a like effect are other decisions cited by appellant, such as Wofford v. Unger, 55 Tex. 480; Zapalac v. Zapp, 22 Tex. Civ. App. 375, 54 S. W. 938; King v. Parks, 26 Tex. Civ. App. 95, 63 S. W. 900; Union Mutual Life Ins. Co. v. Hanford, 143 U. S. 187, 12 S. Ct. 437, 36 L. Ed. 118. But it is clear that those decisions are not applicable in favor of Mrs. Jolly, since she never executed or agreed to assume the mortgage in question in this case, and since the foreclosure sought against her was not based upon any contract on her part. She was sued as a subsequent purchaser, holding the equity of redemption in subordination to the mortgage lien theretofore given by Holden. Mrs. Jolly owned that equity of redemption, but it cannot be said that she was in any sense a surety for the payment of Holden's note.

It is next insisted that article 5538, suspending the statutes of limitation in favor of or against the estate of a decedent has no application as against Mrs. Jolly for foreclosure. The argument...