Mitchell v. Federal Mortgage Co., 1148.

• Citation: 45 S.W.2d 649
• Decision Date: 14 January 1932
• Docket Number: No. 1148.,1148.
• Parties: MITCHELL et al. v. FEDERAL MORTGAGE CO.
• Court: Texas Court of Appeals

Page 649

45 S.W.2d 649

MITCHELL et al. v. FEDERAL MORTGAGE CO.

No. 1148.

Court of Civil Appeals of Texas. Waco.

January 14, 1932.

Appeal from District Court, Dallas County; Robt. B. Allen, Judge.

Suit by the Federal Mortgage Company against R. E. Mitchell and wife and others. From the decree rendered, defendants other than J. E. Dalton appeal.

Decision in accordance with opinion.

Houtchens & Clark and J. H. Craik, all of Fort Worth, for appellants.

Thompson, Knight, Baker & Harris, Dwight L. Simmons, and Sol Goodell, all of Dallas, for appellee.

GALLAGHER, C. J.

This appeal is prosecuted from a judgment of the district court awarding appellee a recovery against appellants R. E. Mitchell and Minnie Irene Mitchell for the sum of $4,116.99, with interest and costs of suit, and against them, Thos. W. Grice, and Ada L. Grice, also appellants herein, and J. E. Dalton, for the foreclosure of a mortgage lien on lot 9 in block 51, Highland Park addition to the city of Fort Worth, Tex. Appellants Thos. W. Grice and Ada L. Grice were on the 14th day of December, 1925, and have been continuously since that time, husband and wife. They, together with several minor children, on said date resided upon the tract of land above described and claimed the same as their homestead. They desired to obtain a loan in the sum of approximately $2,800 and offered to secure the same by a lien upon their said homestead. They consulted certain loan brokers, and were advised by them that the way to procure a loan upon a homestead was to make a conveyance thereof to a third party and take his note, secured by a vendor's lien, for the amount desired. They were further advised that they could then sell the vendor's lien note and afterward have the grantee reconvey to them. They both testified that they thought this procedure would be legal. Appellant Thos. W. Grice approached one Clark and sought to procure from or through him the desired loan. He offered the property hereinbefore described as security for such loan. After the conversation with said Clark, appellants Grice and wife conveyed the property involved to appellant R. E. Mitchell. The deed recited a total consideration of $6,500, and further recited that $3,700 of the same had been paid in cash and the remaining $2,800 by a vendor's lien note due in thirty days. A vendor's lien was expressly retained to secure said note. Said deed was duly filed for record. Shortly thereafter Grice and wife, as a result of negotiations with said Clark, assigned said note and the lien securing the same to appellee. Mitchell and wife then executed new notes to the Federal Mortgage Company in renewal and extension of the original vendor's lien note executed and delivered by them to Grice and wife, and secured said notes with deeds of trust on said property. Shortly thereafter Mitchell and wife reconveyed the property to said Ada L. Grice for the recited consideration of $10. Default having been made in payments stipulated in the renewal notes, appellee accelerated the maturity of the entire debt and instituted this suit to enforce the collection of the same. Dalton, sued as defendant in the court below, claimed no interest in the property, having merely been a tenant of Grice and wife during their temporary absence from Fort Worth.

The case was tried to a jury. The court, at the close of the testimony, instructed the jury to return a verdict in favor of plaintiff against R. E. Mitchell and wife for the sum of $4,116.99, being the balance due on said renewal notes, and against them and all the other parties defendant for a foreclosure of the deed of trust lien on said property. Appellants Mitchell and wife and Grice and wife present said judgment to this court for review.

Opinion.

Appellants present an assignment of error in which they complain of the action of the court in excluding, on objection of appellee, the testimony of Dr. Grice concerning his negotiations with Clark at the time he first applied to him for a loan to be secured by a lien on said property. The substance of the testimony so offered and excluded was that Dr. Grice told Clark that he wanted a loan on his home, designating the particular property involved in this case; that Clark told him that he understood such property was his homestead, and that in order to get a loan thereon he would have to deed it to some one, secure the loan, and then have such party deed the property back to him; that that was the method used in making that kind of a loan, and that such course was necessary to get away from the homestead law; that that was the way they were handling such loans; that they made them in that way every day. The grounds of appell...