Lincoln v. Bennett
| Decision Date | 12 November 1941 |
| Docket Number | No. 7704.,7704. |
| Parties | LINCOLN et ux. v. BENNETT. |
| Court | Texas Supreme Court |
Suit by James A. Lincoln and wife against Dale E. Bennett to cancel a trust deed. From an adverse judgment, the plaintiffs appealed to the Court of Civil Appeals. To review a judgment of the Court of Civil Appeals, 135 S.W.2d 632, affirming the judgment, the plaintiffs bring error.
Judgments of trial court and Court of Civil Appeals reversed in part, and affirmed in part, and judgment rendered.
Goggans & Ritchie, Nathaniel Jacks, and John B. Stigall, Jr., all of Dallas, for plaintiffs in error.
Liveley, Dougherty & Alexander, of Dallas, for defendant in error.
This suit was filed by plaintiffs in error, James A. Lincoln and wife, to cancel a deed of trust, dated May 31, 1927, given to secure a loan of $7,000, advanced by defendant in error, Dale E. Bennett, for the purpose of renewing and extending a deed of trust dated May 25, 1922, executed by plaintiffs in error to secure one G. H. Schoellkopf in the payment of a note for $7,000. Plaintiffs in error sought cancellation of the lien and deed of trust on the ground that the property encumbered, a lot situated on Harwood Street in the City of Dallas, is their homestead, and has been openly and uninterruptedly used and occupied by them as their homestead since 1907, down to and inclusive of the date of trial, and that the lien is invalid and unenforcible under the provisions of Section 50 of Article XVI of the State Constitution, Vernon's Ann.St.
Defendant in error alleged that the Schoellkopf note was taken up and renewed and extended at the special instance and request of James A. Lincoln, who represented to Hiram F. Lively, the acting representative and attorney of defendant in error, that the Schoellkopf note was secured by a valid lien on the Harwood Street property, and that the lot was not his homestead when the Schoellkopf deed of trust and note were executed; that at the time of the Schoellkopf transaction, and as a part thereof, plaintiffs in error executed and acknowledged, and caused to be filed for record in the deed records of Dallas County, a designation of homestead, in which they designated property on Lindsley Avenue, in Dallas, then owned by them, as their homestead. It was further alleged that at the time of the purchase and extension of the Schoellkopf note and deed of trust, neither Bennett nor his attorney knew or had any notice that the Harwood Street property was the homestead of plaintiffs in error in 1922, and did not know that the statement contained in the designation of homestead was untrue; that James A. Lincoln concealed the true facts respecting the homestead status in May, 1922, with the intention of inducing him to purchase the Schoellkopf note and deed of trust; and, therefore, that plaintiffs in error are estopped to assert that the original deed of trust made to Schoellkopf is invalid.
The case was submitted to the jury on special issues, and the trial court entered judgment in favor of Dale E. Bennett, foreclosing the deed of trust held by him. The Court of Civil Appeals, by a majority opinion, Chief Justice Bond dissenting, affirmed the judgment of the trial court. 135 S.W.2d 632, 634. This court granted the application for writ of error on the importance of the homestead question involved and because of the dissenting opinion.
Defendant in error contends that Lincoln and wife are estopped from asserting that the deed of trust lien held by him is invalid, because the property upon which such deed of trust was given constitutes their homestead, on two grounds: (a) Because of the representations made by Lincoln and wife in the designation of homestead that such property was not their homestead; and (b) because Lincoln represented to the attorney for Bennett that the lien held by Schoellkopf was a valid one.
It is undisputed that the note held by Schoellkopf and Bennett was not made for purchase money or any part thereof, or for taxes due on such property, or for work and material used in constructing improvements thereon. It is also undisputed that Lincoln and wife never occupied the property on Lindsley Avenue, which they designated as their homestead, nor did they make any pretense to occupy same. We quote from the opinion of the Court of Civil Appeals the following statement: "It is not disputed that, at the time the Schoellkopf loan was consummated in May, 1922, the Harwood Street property was the homestead of appellants, and that, the statements contained in their homestead designation to the contrary were untrue, and that all other statements or implications contradictory of the idea of its being their homestead at the time were untrue."
Article XVI, Section 50, of the Constitution declares that "No mortgage, trust deed, or other lien on the homestead shall ever be valid, except for the purchase money therefor, or improvements made thereon, as hereinbefore provided, whether such mortgage, or trust deed, or other lien, shall have been created by the husband alone, or together with his wife; * * *."
Our courts have in certain cases enforced against the homestead certain liens which were created neither for purchase money nor for improvements contracted for as provided for in the provision of the Constitution just quoted. Those cases are generally classified as follows: "(1) When the owners, not actually occupying the property, or so using it that its status is dubious at the time the mortgage is executed, represent that it is not their homestead; (2) when the owners create a lien by entering into a simulated transaction which has all the outward appearance of a valid, unconditional sale, but which is in fact a mortgage; (3) when the owners represent that existing notes are valid mechanic's lien notes for improvements, secured by a mechanic's lien contract properly executed."
This case does not fall within any of the three classes above mentioned. Consequently, a discussion of the decisions falling within those three classes would be immaterial to a decision of this case. Also, to do so would unnecessarily prolong this opinion. We shall merely cite some of the leading cases falling within those classes: First Texas Joint Stock Land Bank v. Chapman, Tex.Civ.App., 48 S.W.2d 651; McMullan v. San Antonio Joint Stock Land Bank of San Antonio, Tex.Civ.App., 78 S.W.2d 669; Carstens v. Landrum, Tex. Com.App., 17 S.W.2d 803; Parrish...
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Osborn, In re, 91-7008
...cannot be. In re Daves, 770 F.2d at 1369 (citing Burkhardt v. Lieberman, 138 Tex. 409, 159 S.W.2d 847, 851 (1942), and Lincoln v. Bennett, 156 S.W.2d 504, 507 (Tex.1941)). It has long been the rule in Texas that estoppel must be based on the acts of both the husband and wife. See Martin v. ......
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Sanchez v. Telles
...whether written or oral, which state to the contrary. NCNB Texas Nat'l Bank, 849 S.W.2d at 880, citing Lincoln v. Bennett, 138 Tex. 56, 156 S.W.2d 504, 506 (1941); First Interstate Bank, 810 S.W.2d at 287. Moreover, when a homestead claimant is in actual occupancy of his homestead, it will ......
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Marketic v. U.S. Bank Nat. Ass'n
...regarding homestead property do not affect the constitutional validity of a lien that may arise therefrom. In Lincoln v. Bennett, 138 Tex. 56, 156 S.W.2d 504, 506 (1941), the Court If property be homestead in fact and law, lenders must understand that liens cannot be fixed upon it, and that......
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In re Howard, Bankruptcy No. 7-85-00180.
...the lien was not valid in the hands of the bank. See Burkhardt v. Lieberman, 138 Tex. 409, 159 S.W.2d 847 (1942) and Lincoln v. Bennett, 138 Tex. 56, 156 S.W.2d 504 (1941) (inquiry by subsequent purchaser of land or of lien required where property actually occupied by owners for homestead p......