Trammell v. Swan

• Decision Date: 01 January 1860
• Citation: 25 Tex. 473
• Parties: JAMES H. TRAMMELL AND OTHERS v. S. G. SWAN, ADM'R
• Court: Texas Supreme Court

25 Tex. 473

JAMES H. TRAMMELL AND OTHERS

v.S. G. SWAN, ADM'R

Supreme Court of Texas.

1860.

Where one of the parties to a simulated contract executes to the other his note, the consideration of which is, for instance, the pretended purchase of a stock of goods, by which pretended sale the property in the goods did not pass to such pretended purchaser, and the latter induces a third party, in ignorance of the facts and under a deception practiced upon him, to sign the note as surety, the signature of the surety thus procured (the facts being suppressed from him, and the transaction apparently a real and bona fide sale by an administrator under an order of court), operates a virtual fraud upon the surety, and he may avoid the contract.

A plea setting up these facts presents a good defense to an action on the note in the hands of the payee. 25 Tex. S. 451.

When the capacity in which the plaintiff sues and seeks to recover is not put in issue by plea, it is unnecessary on his part to prove his representative character, or his right to recover in that character upon the trial. 12 Tex. 112, 130.

John J. R. Legrand sued on a promissory note, using in his petition the terms “your petitioner, a resident citizen, etc., administrator of the estate of, etc.;”the petition averred also that the note was the property of the plaintiff's intestate, which was not put in issue by the pleadings. The defendants insisted that the suit was not brought by the plaintiff in his representative capacity. Held, that under the pleadings the plaintiff was not required to prove the ownership of the note as alleged, and that under that aspect of the case it was not material whether the suit was brought in the plaintiff's own right, or in his representative capacity.

Where a party has had ample time to plead, and after pleadings and amendments had, after the case was called for trial, been ruled upon by the court, the court may well refuse to entertain further amendments, and it is not error to reject a plea setting up a new defense, pleaded by way of amendment under the circumstances above mentioned.

An administrator cannot receive notes and accounts upon third parties in payment of a debt due to the estate, without having a proper order for that purpose from the county court; and the doctrine of estoppel in pais will not avail the party giving such notes or accounts as payment, as a defense against the debt due the estate, beyond the amount of money which may have been realized from them.

APPEAL from Rusk. Tried below before the Hon. C. A. Frazer.

This was a suit brought by John J. R. Legrand against James H. Trammell, Mark Stroud, William Moore and Jesse Walling, on a promissory note payable to the plaintiff, “administrator of the estate of John S. Caruthers deceased, or bearer,” for the sum of eighteen thousand seven hundred and twenty-four dollars and forty-five cents, dated the 1st day of September, 1852, and payable twelve months after date. Suit was filed November the 4th, 1853.

The consideration of the note was the sale under an order of the county court, at private sale by the administrator, J. J. R. Legrand, of a stock of goods belonging to the estate of John S. Caruthers, deceased, at which Trammell became the purchaser and the other defendants his sureties.

The petition, in effect (so far as it is material to state its contents), is as follows:

“Your petitioner, John J. R. Legrand, a resident citizen of the county of Rusk, and state of Texas, administrator of the estate of John S. Caruthers, complains of” said defendants (naming them) “in this, that said defendants made and delivered to your petitioner their joint and several promissory note,” describing the note and making it a part of the petition; alleging liability of defendants, and their failure to pay the same, and concluding in the usual from with a prayer for process and judgment.

The defendants pleaded payment on the note to the amount of fifteen thousand and seventy-three dollars and four cents. Subsequently, during the progress of the suit, further payments were pleaded, as having been made since the institution of the suit. The character of these payments was set out in the defendants' respective answers setting them up, as the receipts of attorneys for notes received by them from Trammell for collection; claims paid or “taken up” by said Trammell against the estate of Caruthers; accounts on the books of J. H. Trammell & Co.; and “good notes belonging to J. H. Trammell & Co.;” which evidences of indebtedness, or choses in action, were fully specified with the accompanying receipts of Legrand, the administrator, acknowledging that he had received said claims as payments to be credited on the note on which the suit is brought.

The plaintiff filed general and special exceptions to the answers of the defendants.

The plaintiff amended his petition (filed November 2d, 1857), and alleged that the note is the property of the estate of Caruthers; that the estate is insolvent; that the receipts given by him were conditional, and were to be regarded as evidences of payment no further than for the amount of cash that might be collected on said notes and claims; that he collected no more on these notes and claims than the auditor's report shows, the balance of them being insolvent; that he was appointed administrator, etc. (stating the time); that the note was in consideration of property of said estate, sold to defendants; and that said note now belongs and has always belonged to said estate.

The defendant, Walling, filed a separate answer, alleging in substance, that he signed the note sued on as security for James H. Trammell; that Legrand, the administrator, well knew this fact; that Legrand and Trammell, before the pretended sale of said goods, had entered into an agreement that said Trammell should become the purchaser of said goods for himself and Legrand; that after said pretended sale said Legrand had still possession and control of said goods, and was selling the same for himself and said Trammell up to the date of filing this plea; that there was no public sale of said goods; that they were sold privately; that at the execution of said note defendant, Walling, was entirely ignorant of the arrangement between Legrand and Trammell; that the title to said goods never passed out of said Legrand as administrator; that this defendant has no interest in or control of said goods; that for the above reasons said sale was null and void, and defendant not liable on said note.

The plaintiff filed general and special exceptions to all the answers of the defendants filed by them jointly or separately; the ground taken in the special exceptions to the amended answers of defendants being a want of authority, as administrator, to receive anything in discharge of a debt due the estate except money, without an order of court.

During the progress of the suit Legrand was removed from the administration of the estate, which was suggested, and his successor, Samuel G. Swan, made himself a party plaintiff in the suit.

The defendants filed a general and special exception to the original and amended petition of the plaintiff, and excepted to Swan's being made a party plaintiff, because said petitions show that said plaintiff has had, and has now, no legal cause of action against these defendants. “And defendants also except to S. G. Swan's making himself a party plaintiff in this suit as the administrator of the estate of John S. Caruthers, or in his own right, because the pleadings of the plaintiff show that said Swan cannot of right be made a party plaintiff, as will appear from inspection of the papers filed in this cause.”

The cause was called for trial on the 28th day of May, 1858, and the application of the defendants for a continuance was overruled; and leave of the court was granted to the defendants to amend, and on the same day filed an amendment to the plea of payment On the next day the trial proceeded, and the defendants' demurrer or exceptions to the plaintiff's petition were overruled, and the defendants asked leave to amend by pleading the statute of limitations, which application was refused.

Thereupon, the court ruled that “the exceptions of the plaintiff to the answers of the defendants being considered of by the court, are sustained to such extent as to reduce said answers to pleas of payment in money, with leave to amend.” The defendants amended their plea of payment, alleging that the plaintiff received and realized the moneys for the several choses in action delivered to him, and received them as cash payments, and that it was understood by said Legrand that all of said items were received by him as equivalent to cash payments, and were to be credited on the note; and also filed a plea of the statute of limitations to the note sued on, averring that the cause of action accrued more than four years before the filing of plaintiff's amended petition filed on the 2d day of November, 1857. To which plea of the statute of limitations plaintiff excepted, because

1st. “Said defense was not included in any of the pleas excepted to by plaintiff, the exceptions to which were sustained.”

2d. “The said defense was not embraced in the leave given by the court to amend.”

3d. “Said defense is for the first time attempted to be set up, after an announcement of readiness for trial, and after all exceptions to the pleadings have been presented and acted on by the court.”

These exceptions were sustained by the court as to the plea of the statute of limitations, and “to such an extent as to reduce the answer as amended to a plea of payment in money.”

The court instructed the jury “to find a verdict for the plaintiff for the amount of the note sued on, after allowing the defendants a credit for all the amounts of money paid by them or either of them, or realized by the plaintiff on the notes and property turned over to him by them, or either of them, to collect or...