Burrow v. McMahan

384 S.W.2d 124
CourtTexas Supreme Court
DecidedNovember 4, 1964
DocketA-10128
StatusPublished
Cited by6 cases

This text of 384 S.W.2d 124 (Burrow v. McMahan) is published on Counsel Stack Legal Research, covering Texas Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Burrow v. McMahan, 384 S.W.2d 124 (Tex. 1964).

Opinion

WALKER, Justice.

This action in trespass to try title was instituted by James W. McMahan et al., respondents, to recover certain severed mineral interests in Foard County. Judgment was rendered in favor of respondents after a trial to the court on an agreed statement of facts, and the Court of Civil Appeals affirmed. 376 S.W.2d 850. As the case reaches this Court, the rights of the parties turn upon whether the attack made by respondents on a substitute trustee’s deed executed in 1937 is barred by Article 5523a, Vernon’s Ann.Tex.Civ.Stat. We hold that the statute does not apply where, as here, the evidence shows affirmatively that the purported substitute trustee had no authority to sell the premises under the deed of trust.

On July 22, 1922, Ed Andress and wife, Josie Andress, who are the agreed common source of title, executed and delivered a deed of trust to M. H. Gossett, trustee, to secure the payment of a note for $2,000.00 to The Federal Land Bank of Houston. The note was payable in semi-annual installments, and the deed of trust provided for foreclosure in satisfaction of a defaulted installment without declaring the entire debt due. After the execution of the deed of trust but prior to the purported foreclosure discussed below, Ed Andress and Josie Andress and their successors in title conveyed the mineral interests in controversy to T. V. McMahan and W. L. Graham. The title thus acquired by T. V. McMahan and W. L. Graham is now held by respondents unless the same has been divested by the foreclosure sale.

Default was made in the payment of the installment due September 1, 1937, on the note to The Federal Land Bank of Houston. By instrument dated September 4, 1937, and reciting that M. H. Gossett, trustee, had died, the Bank appointed A. C. Williams substitute trustee and transferred the delinquent installment to Mrs. Dorothy Hofues. When requested by Mrs. Hofues to sell the land in satisfaction of the installment, A. C. Williams refused to make the sale. On October 6, 1937, Mrs. Hofues executed a written instrument appointing T. B. Burrow as substitute trustee in the *126 place of A. C. Williams. This appointment, which was subsequently filed for record in Foard County, recites that A. C. Williams had refused to execute the trust and that Mrs. Hofues was authorized by the deed of trust to appoint a substitute trustee. On December 7, 1937, T. B. Burrow conducted a foreclosure sale and executed a substitute trustee’s deed to H. W. Cotner and wife, Bess Cotner, under whom petitioners claim. This deed was actually recorded in the office of the County Clerk of Foard County on February 8, 1938, and the present suit was instituted about 21 years later.

Deeds of trust containing substantially the same provisions as the instrument executed by Ed Andress and Mrs. Josie An-dress to M. H. Gossett, trustee, have been ■considered by our courts on at least two previous occasions. In Hart v. McClusky, Tex.Civ.App., 118 S.W.2d 1077 (writ ref.), the substitute trustee appointed by the Bank ■designated an attorney in fact, who conducted a foreclosure sale in satisfaction of a defaulted installment. It was contended that the appointment of the substitute trustee was void because not made by the as-signee of the installment, but the court ■concluded that the power to appoint a substitute trustee was vested in and restricted to the Bank or other holder of the principal indebtedness secured by the deed of trust. In Johnson v. Koenig, Tex.Civ.App., 353 S.W.2d 478 (writ ref. n. r. e.), it was held that the deed of trust did not authorize the appointment of a substitute trustee by an •assignee of two defaulted installments. On the authority of these decisions, the Court ■of Civil Appeals held in the present case that Mrs. Hofues had no power to appoint .a substitute trustee under the terms of the deed of trust. Petitioners do not question that conclusion here, and we accordingly accept it as sound for the purpose of this opinion. Their single point of error as-serts that the intermediate court erred in refusing to hold that Article 5523a is a bar to the attack made by respondents on the substitute trustee’s deed.

In so far as it is material here, Article 5523a provides that “[a]ny person who has the right of action for the recovery of land because of any one or more of the following defects in 'any instrument, * * * or where such instrument is executed by a trustee without record of Judicial or other ascertainment of the authority of such trustee or of the verity of the facts therein recited; * * * shall institute his suit therefor not later than 10 years next after the date when such instrument has been or hereafter may be actually recorded in the office of the County Clerk of the county in which such real estate is situated and not afterwards; * * Petitioners contend that this statute precludes any inquiry into the authority of a purported trustee or into the truth of the recitals in an instrument executed by him after the instrument has been on record for ten years.

In Covington v. Priddy, Tex.Civ.App., 373 S.W.2d 877 (writ ref. n. r. e.), the ap-pellees claimed through a substitute trustee’s deed executed by H. N. McKellar to J. N. Brooker, but there was no evidence that McKellar had or had not been appointed substitute trustee. His deed merely recited that the holder of the indebtedness secured by the deed of trust had requested him “as substitute trustee” to sell the premises. It was held that Article 5523a applied, and that the trial court did not err in admitting the deed in evidence. Petitioners also rely on Dali v. Lindsey, Tex. Civ.App., 237 S.W.2d 1006 (writ ref. n. r. e.), where the deed of trust required that a substitute trustee be appointed in writing. An instrument stating that “Empire Mortgage Company, the legal owner and holder of the indebtedness described in said deed of trust has appointed H. L. Hunter of Wichita County, Texas, as substitute trustee,” was executed by such company. The appellee contended and the trial court concluded that this was merely an ex parte statement about some other document or event. The Court of Civil Appeals held that the instrument constituted an appointment in writing of H. L. Hunter as sub *127 stitute trustee and that he was not disqualified to act in that capacity under the facts shown. It then went on to say by way of dictum that the appellee was precluded by Article 5523a from questioning the authority of the substitute trustee or the'verity of the facts recited in his deed.

Respondents cite Campsey v. Jack County Oil & Gas Ass’n, Tcx.Civ.App., 328 S.W.2d 912 (writ ref. n. r. e.), which involved a deed executed by S. V. Stark purporting to act as trustee for an unincorporated joint stock company. Suit was brought to cancel the deed, and the plaintiff established by evidence that Stark had no authority to act as trustee. In holding that the action was not barred by Article 5523a, the court said:

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384 S.W.2d 124, Counsel Stack Legal Research, https://law.counselstack.com/opinion/burrow-v-mcmahan-tex-1964.