Sorenson v. City Nat. Bank

• Decision Date: 16 May 1932
• Docket Number: No. 1557-5889.,1557-5889.
• Parties: SORENSON v. CITY NAT. BANK.
• Court: Texas Supreme Court

49 S.W.2d 718

SORENSON v. CITY NAT. BANK.

No. 1557-5889.

Commission of Appeals of Texas, Section A.

May 16, 1932.

Certified Questions from Court of Civil Appeals of Eleventh Supreme Judicial District.

Suit by Paul B. Sorenson against J. H. Wallace, in which the City National Bank was garnished. Judgment for the garnishee, and the plaintiff appealed to the Court of Civil Appeals, which certified questions to the Commission of Appeals.

Questions answered.

E. J. Hamner, of Sweetwater, for appellant.

T. Vard Woodruff, B. M. Neblett, and Douthit, Mays & Perkins, all of Sweetwater, for appellee.

CRITZ, J.

This case is before us on certified questions from the Court of Civil Appeals for the Eleventh district at Eastland. The certificate is as follows:

"In the above case Paul B. Sorenson sued J. H. Wallace in Justice Court and at the same time sued out writ of garnishment to City National Bank of Sweetwater. The garnishee in due time answered that it was not indebted to said Wallace and had no effects in its possession belonging to him. Upon a contest of garnishee's answer Sorenson asserted and tendered as an issue that a certain sum on deposit in the bank in the name of Mrs. J. H. Wallace, wife of defendant J. H. Wallace, was the community property of Wallace and wife `derived from the proceeds of an insurance policy covering a loss by fire of community property' and subject to the debt of plaintiff, of which facts and the further fact that plaintiff sought by the garnishment to reach and hold said fund, the bank had actual notice before it filed its answer. Judgment was for plaintiff in the main suit for $154.85, and against the garnishee in the garnishment suit for the same amount. The garnishee appealed to the county court. There the case has been tried a number of times, two appeals from former judgments therein having heretofore been disposed of in courts of civil appeals. See Sorenson v. City National Bank, 273 S. W. 638; Sorenson v. City National Bank, 293 S. W. 638.

"The one ultimate issue of fact tendered by plaintiff and duly joined by the pleadings was, of course, whether garnishee was indebted to J. H. Wallace. Actually this issue was apparently by consent of the parties made to depend upon the existence or not of three evidentiary though conclusive facts; namely, (1st) Was the fund of $879.87 on deposit in the name of Mrs. J. H. Wallace, her separate property by reason of being the proceeds of insurance upon her separate property destroyed by fire? (2nd) Was said fund community property of J. H. Wallace and wife by reason of being proceeds of insurance upon community property of said Wallace and wife? (3rd) Was said fund the separate property of Mrs. J. H. Wallace by reason of being a gift thereof from her husband at the time of deposit, even if same was the proceeds of insurance on community property of Wallace and wife. Two other ultimate issues were tendered by garnishee. One was that, even if the fund was community property of Wallace and wife, it was exempt from garnishment by reason of same being the proceeds of insurance upon the homestead and household goods of said J. H. Wallace and wife. The other was the reasonableness in amount of attorney's fees to be allowed the garnishee.

"The jury returned a verdict in favor of the garnishee, in response to a peremptory instruction to do so, and also found, in answer to a special issue submitted, that $200.00 was a reasonable attorney's fee for the garnishee. The appeal is by the plaintiff from a judgment in favor of garnishee rendered upon that verdict.

"Following the original submission of the case this court rendered an opinion reforming the judgment in one respect and as reformed affirming the judgment of the trial court, a copy of which opinion accompanies this certificate.

"Appellant has filed a motion for rehearing, in response to which we have prepared but have not delivered a further opinion overruling the motion, a copy of which also accompanies this certificate.

"In deference, however, to the learning and ability of appellant's counsel, and the earnestness with which it is insisted that we are in conflict with opinions of the Supreme Court and other courts of civil appeals, and further, because of the importance of the question of attorney's fees, which does not appear to have been so definitely and squarely settled by the Supreme Court as to foreclose further argument, and in further view of the fact that our decision cannot be reviewed by writ of error, we have determined, instead of the action indicated by the said opinion on rehearing, to certify for your decision the following questions:

"First: Did the trial court err in refusing to give a judgment nil dicit in favor of plaintiff and against the defendant, J. H. Wallace, determining as against both said Wallace and the garnishee the issue of the waiver of exemption?

"Second: After Wallace was, by order of court, permitted to withdraw his appearance and all pleadings filed by him, and was thereupon dismissed from the case, were there remaining any pleadings in the case joining an issue between plaintiff and garnishee of the waiver of exemption of the fund in question?

"Third: Where a garnishee, after service of garnishment, having the opportunity to implead the judgment debtor and another claimant of a fund, and to hold or tender such fund to abide the result of the suit, fails to implead such parties and voluntarily pays the same to the claimant other than the judgment debtor, with knowledge of a contention on the part of plaintiff that the fund is subject to the garnishment, and said garnishee thereafter, as an interested partisan, litigates its liability upon the ground, among others, that the fund is exempt and prevails in the suit, is such garnishee entitled to recover attorney's fees for services of attorneys over and above a reasonable fee for answering and impleading the judgment debtor and other claimants?

"Fourth: If not, has the court the power or discretion to adjudge recovery in favor of the garnishee of a reasonable attorney's fee to cover only the expense of preparing and filing an answer, such answer not disclosing the garnishee's partisan attitude?

"The record will disclose that this case, although involving about $154.00, is in the Court of Civil Appeals for the third time, and has several times been tried in the lower courts, and to the end that it may be properly and conclusively determined by your answers to the foregoing questions, we respectfully refer the court to the entire record in the case, which accompanies this certificate and is intended to be made a part thereof."

Simply stated, the facts of this case are as follows:

On July 17, 1922, J. H. Wallace and wife resided in Sweetwater, Nolan county, Tex., where they owned and occupied a homestead which stood in the name of the husband. On the above date the dwelling house, and household goods therein contained, burned. The house and household goods were insured against loss by fire, the house for $1,250, and the contents for $500. William Wright held a vendor's lien against the home, and the insurance policy contained the usual loss payable clause in his favor. Settlement was made with the insurance company on the dwelling for $1,219.87, and on the contents for $500. The insurance company paid the loss by draft for the total sum of $1,719.87, payable to J. H. Wallace and William Wright. The draft was carried to the garnishee bank for the purpose of being cashed. J. H. Wallace and his wife, Mrs. J. H. Wallace, were present, as was also Judge Yantis, attorney for, and representing, William Wright. The draft was properly indorsed and cashed by the bank. Judge Yantis was paid the amount due Wright on his lien, and the balance of the money, $969.87, was passed to the credit of Mrs. J. H. Wallace. At the time this money was deposited to Mrs. Wallace's credit, both she and her husband were present, and the bank received instructions to so deposit the money, and further received instructions that it was deposited subject to Mrs. Wallace's exclusive control, and check. In other words, the testimony is conclusive that the money was deposited to the credit of the wife, in her name, and with the then instruction that it was subject to her exclusive control and check. The husband was present and legally acquiesced in and agreed to this.

On September 1, 1922, Sorenson filed suit in the justice's court, precinct No. 1, Nolan county, Tex., against J. H. Wallace on a sworn account amounting to $154.85. At the same time the suit was filed, and ancillary thereto, affidavit bond in garnishment was filed, and writ of garnishment was immediately...