Dallas Building & Loan Ass'n v. Henry

98 S.W.2d 1030
CourtCourt of Appeals of Texas
DecidedNovember 6, 1936
DocketNo. 13447
StatusPublished
Cited by2 cases

This text of 98 S.W.2d 1030 (Dallas Building & Loan Ass'n v. Henry) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Dallas Building & Loan Ass'n v. Henry, 98 S.W.2d 1030 (Tex. Ct. App. 1936).

Opinion

DUNKLIN, Chief Justice.

The Dallas Building & Loan Association instituted this suit against George L. Henry and wife, Lizzie Henry, in trespass to try title to a lot situated in the city of Dallas.

In addition to a general demurrer, general denial, and a plea of not guilty, the defendants attacked certain links in plaintiff’s chain of title. The grounds upon which those instruments were challenged were sustained, and, by reason thereof, plaintiff was denied a recovery, and the property and title was awarded to defendants upon their cross-action.

Plaintiff made out a regular chain of title through duly recorded instruments, and the only issues involved on this appeal relate to grounds upon which some of the links in plaintiff's chain of title were invalid.

The disputed instruments were as follows: (1) A general warranty deed, dated November 1, 1927, from the defendants George L. Henry and wife to L. J. Taylor and T. K. Irwin, reciting a cash consideration paid of $500.

(2) A special warranty deed from L. J. Taylor and T. K. Irwin to George L. Henry and -wife, dated October 25, 1928, reciting a cash consideration of $10 and a promissory note in the sum of $750 payable to the order of J. Foree Morgan.

(3) A conveyance, of date October 25, 1928, from J. Foree Morgan to P. P. Martinez of $750 vendor’s lien note, noted above, and the lien securing the same.

[1032]*1032(4) A deed of trust from George L. Henry and wife, of date October 25, 1928, given to secure payment of four notes, aggregating $750, with the recital that the same were given in renewal and extension of $750 vendor’s lien note, noted above.

(5) A mechanic’s lien contract between the defendants and J. S. Cordelia, dated March 5, 1929, for improvements on the property in controversy in the sum of $1,-800.

(6) Deed, dated April 3, 1929, from P. P. Martinez to plaintiff of the indebtedness secured by the deed of trust in favor of Martinez, noted above.

’(7) A conveyance from J. S. Cordelia tp plaintiff, of date April 3, 1929, of the unpaid balance of $419.72 of the indebtedness represented by the mechanic’s lien contract.

(8) Deed of trust, dated April 8, 1929, executed by defendants to secure their note to plaintiff in the sum of $1,450, executed as a renewal and extension of the indebtedness by Martinez and Cordelia.

(9) Deed of trust, dated February 15, 1932, executed by the defendants in favor of plaintiff to secure a note in the sum of $1,394.58, given as a renewal of the $1,450 note last mentioned.

(10) Deed of conveyance executed to plaintiff by the trustee in the last-mentioned deed of trust, on November 1, 1932, executed under the power of sale given in the deed of trust to satisfy the debt therein secured.

George L. Henry was adjudged insane and was confined in the insane asylum at Rusk, and Mr. George Clifton Edwards was duly appointed as guardian ad litem to represent his interest in the suit, and he filed a pleading adopting the pleadings theretofore filed by Lizzie Henry, which included a cross-action for a cancellation of all the instruments referred to above as a cloud upon their title and for adjudication of title in the two defendants, free of those clouds.

The first instrument listed above, being the deed from the two defendants in favor of L. J. Taylor and T. K. Irwin, was attacked upon the ground that at the time it was executed the property therein described was the homestead of the defendants and was then being occupied by them as such, and that the purported conveyance was intended as a mortgage and not as a conveyance of title, and for that reason, and for the further reason that George L. Henry was at that time insane and legally incompetent to bind himself by that instrument, it was void.

According to further allegations in defendants’ pleadings, all the remaining instruments listed above, of date prior to the sale of the property by the trustee to the plaintiff under foreclosure proceedings, with the exception of the mechanic’s lien contract with Cordelia, were executed for the purpose of giving effect to the purported deed to Taylor and Irwin as a valid and binding conveyance; and that plaintiff had actual and constructive notice of all of those facts at the time it acquired the deed of trust under which it purchased the property at foreclosure sale by the trustee.

According to further allegations, the note executed by the defendants to Cordelia in the mechanic’s lien contract included a fictitious amount over and above the cost of the improvements, and the excess sum so included was a charge of usurious interest, which was therefore illegal and void, and plaintiff had actual and constructive notice of those facts also at the time it .acquired the deed of trust under which it bought the property at foreclosure sale, and the mechanic’s lien has been discharged by full payment of the amount due for those improvements.

After the suit was instituted, defendants were ousted of possession of the property by virtue of a writ of sequestration, sued out by plaintiff, and they sought a recovery of actual and exemplary damages therefor under allegations that such action by plaintiff was without probable cause and with malice.

Plaintiff’s supplemental petition embodied a general denial of the allegations in defendants’ pleadings and also pleaded specially that it was an innocent purchaser of the property for valuable consideration paid, relying in good faith upon the instruments theretofore recorded, and without any notice of the matters specially pleaded by the defendants, with a further plea of estop-pel against the defendants to set up those defenses.

The record shows that the defendants were colored people, earning their livelihood by their daily labors; the defendant Lizzie Henry being employed as a domestic servant a portion of the time and her husband, George, working at different jobs. They acquired a lot 35x95 feet in a negro settlement in the suburban portion of the [1033]*1033city of Dallas, which they improved with a dwelling in keeping with their financial circumstances and local surroundings, the property being their homestead at the time the first instrument listed above was executed, and has been so claimed by them ever since. While they so owned and occupied the property, the defendant George L. Henry was arrested on a charge of rape, and he employed L. J. Taylor and T. K. Irwin, two Dallas attorneys, to defend him against that charge. Those attorneys represented him in the examining trial before the justice of the peace, where he was bound over by an appearance bond in the sum of $1,000 to await the action of the grand jury. Thereafter Mr. Irwin appeared before the grand jury in behalf of his client, and as the result of his efforts no indictment was returned, and the prosecution was dropped.

The attorneys charged a fee of $500 for their services, and, defendants being unable to pay it, they executed the purported deed listed above.

The following are special issues submitted to the jury with their answers thereto, omitting instructions that some of the issues would be considered only in the event of affirmative findings to preceding issues:

'T. Do you find from a preponderance of the evidence that the deed dated November 1, 1927, from George L.

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Bluebook (online)
98 S.W.2d 1030, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dallas-building-loan-assn-v-henry-texapp-1936.