Western Mortg. & Inv. Co. v. Burford

• Decision Date: 17 December 1895
• Docket Number: 401.
• Citation: 71 F. 74
• Parties: WESTERN MORTG. & INV. CO. v. BURFORD et al. [1]
• Court: U.S. Court of Appeals — Fifth Circuit

71 F. 74

WESTERN MORTG. & INV. CO. v. BURFORD et al. ^[1]

No. 401.

United States Court of Appeals, Fifth Circuit.

December 17, 1895

The appellant, as complainant below, instituted this suit against John W. Burford and wife, Matilda F. Burford, on their joint note, payable to the order of complainant, for $14,000 loaned to them by complainant, and interest thereon at 10 per cent. per annum from December 10, 1889, and 10 per cent attorney's fees. The bill prayed for a judgment for the amount of the note, principal, interest, and attorney's fees, and for a foreclosure of a deed of trust lien executed by respondents Burford and wife, to secure the said loan on 405 acres of land in Tarrant county, Tex. The complainant specially pleaded and relied upon a subrogation clause in said trust deed, which recited the payment by complainant, at the express instance and request of said respondents, of a prior mortgage debt on said 405 acres of land, in favor of the Texas Loan Agency, of $6,300. By way of anticipation of an alleged false and fraudulent plea of homestead by respondents, the complainant averred that, prior to the making of the loans in question, the respondent John W Burford did, on May 2, 1888, designate in writing, and set apart in due form of law, his homestead, as comprising 304 acres of land out of the S. C. Inman survey, no part of which 304 acres was embraced in the 405 acres described in complainant's trust deed and bill; that said designation was duly recorded as provided by law; and that, at the time respondents owned and occupied about 700 acres of land, of separate surveys, but all contiguous; and that said designation of his homestead was never changed by respondent. The complainant further alleged that the respondent Burford represented in his written application for the loan, and in the trust deed, that no part of the 405 acres tendered as security was any part of his homestead; that the loan was made on the faith of his representations and acts; that without same, complainant would not have made the said loan, or any part thereof; and that its security will be irredeemably impaired unless its lien be enforced against all of the 405 acres covered by its trust deed. Burford and wife, respondents below, filed a joint answer, admitting the right of the complainant to a personal judgment against John W. Burford, as prayed for, and the validity of the complainant's lien as to 205 acres of the 405 acres described in the trust deed and in the complainant's bill, and that complainant was subrogated to all the rights of the Texas Loan Agency. The respondents denied the liability of Matilda F. Burford or of her separate estate for the debt in question, under allegations that she was a feme covert, and that the money was loaned to her husband. They further denied the validity of the trust deed as affecting 200 acres of the 405 in question, alleging that at the time of the original loan by the Texas Loan Agency, on May 2, 1888, down to the present time, they have continuously occupied, used, and claimed as a homestead 200 acres (specifically described in same) of the 405 acres covered by complainant's trust deed, and that their trust deed was as to the said 200 acres void under the constitution and laws of Texas. They admitted the execution by J. W. Burford of a homestead designation, and attach as an exhibit to their answer a certified copy of same, and they say they can neither affirm nor deny that the same is in form according to law.

The complainant filed a general replication, and, by amendment to its bill, alleged that, at the time the respondent Burford applied to the Texas Loan Agency for the $6,300 loan, he was temporarily living upon the 405 acres described in the trust deed of complainant; that he was there temporarily only for the convenience of his tenants; that the representative of the Texas Loan Agency informed said Burford, and he in turn informed his wife, that the loan could not be secured unless they would actually vacate the land in question, and designate and occupy the adjacent farm belonging to them; whereupon Burford and wife, with knowledge of the terms exacted by the Texas Loan Agency, requiring them to actually vacate said premises, did move from same, with the intention and with the effect of securing said loan on the faith of their acts as aforesaid; whereupon complainant averred that respondents are estopped from asserting a claim of homestead, and are estopped from claiming that they did not remove from same in good faith. The respondents amended their answer by averments that the Texas Loan Agency had knowledge of the actual occupancy by respondents of the 200 acres described in the original answer as the homestead, and that said acres described in the original answer as the homestead, and that said Texas Loan Agency were not misled or deceived by any acts of respondents.

There were other parties to the cause as respondents besides Burford and wife, but their interests were disposed of as subordinate to complainant's, and no issue or complaint is made as to the decree affecting them. The decree awarded complainant a judgment against John W. Burford for $23,430, with a foreclosure of its deed of trust liens to all of the 405 acres, except 120 acres thereof, particularly described in the decree. 67 F. 860. The decree is complained of only in so far as it denied unto complainant a foreclosure of lien as to the 120 acres, specially excepted in the decree.

The evidence shows that John W. Burford and wife were married in 1874, and shortly afterwards occupied as their home 304 acres of land of the S. C. Inman 640-acre survey, in Tarrant county, Tex., which land was inherited by the wife from her father, and constituted her separate estate; that they lived there until 1879, when they removed to Ft. Worth, temporarily, returning to Mrs. Burford's farm in 1882, where they lived until August, 1884, about 200 acres of the 304 being in cultivation. Meantime Burford and wife acquired other tracts of land adjacent to their homestead, being 120 acres of H. H. Edwards survey, and 111 acres of A. Voght survey, and 134 acres of the S. C. Inman survey, and moved on the 120 acres of the Edwards tracts and the 134 acres of the S. C. Inman tract were subject to a trust deed lien, to secure a $2,500 note and interest, which was not discharged until May 2, 1888. After moving onto the Edwards tract, in August, 1884, Burford and wife bought 40 acres more out of the H. H. Edwards survey, in 1885, and moved to Ft. Worth for the winter of 1885 and 1886, returning to the house on H. H. Edwards tract in 1886. On the 13th day of April, 1888, J. W. Burford made application to the Texas Loan Agency for a loan of $6,300, tendering as security the H. H. Edwards 160 acres, the A. Voght 111 acres, and the 134 acres S. C. Inman survey, in which application he disclaimed any homestead interest in either of said tracts, but expressly stated that his homestead consisted of the 304 acres S. C. Inman survey, adjoining the said tracts. At the date of this application, Willis Swearingen, a tenant of Burford's, was occupying the house, and cultivating the land, on the 304-acre tract, and Burford was living in the house on the H. H. Edwards 120-acre tract.

As to the foregoing facts there is no controversy.

J. W. Burford testified, after making application for the loan (the $6,300 loan), viz.: 'Lassiter, representative of Texas Loan Agency, came to my house. Lassiter was pleased with the land, but said he did not see how he could let me have the money and me living on the land. I then told him I was anxious to borrow the money, and would get off the land in order to shape a loan. I proposed to him that I would exchange homes with Willis Swearingen until loan was consummated. He then said it was satisfactory, if I would also designate the 304 acres S. C. Inman survey as my homestead. ' Mrs. Matilda F. Burford testified, viz.: 'Yes, in May, 1888, Mr. Burford borrowed some money from said company, and I signed the papers. Mr. Lassiter was the party representing the said company. Mr. Burford informed me, at the time he made the application, that Mr. Lassiter did not like to let him have the money on the homestead and place, unless Mr. Burford would move off of the said homestead. We, Mr. Burford and myself, went over to Mr. Swearingen's house, and stayed all night, and Mr. Swearingen and his wife and family, except one daughter, went over to out house, and stayed all night. My daughter stayed over at our house with Mr. Swearingen and his family to attend to the household affairs. That was the move that was made to borrow the money. ' To cross question, 'Is it not a fact that you and your family were not living on May 2, 1888, on the H. H. Edwards survey or any of the land embraced in the trust deed executed by you to complainant, and did you not, on said day, occupy a place by exchange with Willis Swearingen? ' Mrs. Burford answered: 'It is not a fact. We were living on the place on the 2d of May, 1888. We did occupy a place by exchange with Willis Swearingen on the night of May 1, 1888, before the papers were executed. My daughter remained on the place with the family of Swearingen, and their daughter stayed at their house with us. ' Swearingen testified that he was the tenant of Burford, and that Burford asked him to exchange places with him; that he wanted to borrow money on his pasture farm; and 'that they would not let him have the money unless they vacated the place.'

Lassiter testified that he went to Burford's place, and refused the application for loan unless Burford would move from the land tendered as security, and designated his homestead whereupon Burford stated that he would do so, as he had vacated the 304-acre farm of...