American Freehold Land Mortgage Co. v. MacDonell

BROWN, Associate. Justice. On June 28, 1888, C. M. Macdonell and Thomas C. Sheldon executed and delivered to a trustee a deed of trust upon the lands described in the plaintiff's petition to secure the payment of their note for $22,000 to the plaintiff in error. The note-was payable June 1, 1893, with notes attached for the semi-annual interest. C. M. Macdonell died ¡November 24, 1888, and, during the same-year, Allan Macdonell was appointed administrator upon his estate. May 29, 1889, Allan Macdonell, as administrator of the said estate,, under an order of the County Court of Webb County, conveyed to-Thomas C. Sheldon the entire interest of the estate in the lands in controversjq subject, however, to the lien of the deed of trust before mentioned, the payment of which was assumed by Sheldon, and also the sum of $20,000 was to be paid to the administrator of the estate, for which, a vendor’s lien was reserved in the deed and a mortgage was given upon the whole land, including the interest of Sheldon, to secure the performance of that obligation. This placed the title to all of the lands embraced in the deed of trust in Thomas C. Sheldon, who, joined by his wife, conveyed it to Allan Macdonell in July, 1893. In consideration of the conveyance of the land, Allan Macdonell bound himself in a written obligation to pay to the estate of C. M. Macdonell the unpaid balance of the $20,000 of purchase money for the half interest bought by Sheldon from the estate of C. M. Macdonell, and to pay to the plaintiff in error the $22,000 debt due to it from Sheldon and C. M. Macdonell; also to *403 pay to the State of Texas $7424, due on school lands, and to release Sheldon from liability for $2000 paid for him, Allan Macdonell, as guarantor. August 22, 1893, the mortgage company presented its claim, duly authenticated, to the administrator of C. M. Macdonell for allowance, which was duly allowed by the administrator, and, on October 17, 1893, was approved by the County Court, being classified in the fifth class. On May 27, 1895, the mortgage company filed in the County Court of Webb County application for an order directing the administrator of C. M. Macdonelhs estate to foreclose the lien and sell the land embraced in the deed of trust before named, but the application was subsequently withdrawn by the consent of the court without action thereon. Thomas C. Sheldon died at some date not shown in the transcript, and, after his death, on the 6th day of October, 1895, the trustee named in the deed of trust being dead, one Boss was appointed substitute trustee and sold the land, which was bid in for the sum of $6000 by Benjamin Graham for the mortgage company. At the time of this sale, Sheldon and C. M. Macdonell were both dead, but the title appeared to be in Allan Macdonell. October 23, 1895, suit for the land was instituted in the Circuit Court of the United States at San Antonio, Texas, in the name of Benjamin Graham against Allan Macdonell, as administrator of the estate of C. 31. 3Iacdonell, and in his own right. That suit was instituted and prosecuted for the benefit of the mortgage company. Upon trial, judgment was rendered for the defendants, in which it is stated that the court “is of the opinion that plaintiff has proven no cause of action.” The case was appealed to the Circuit Court of the United States, sitting at Mew Orleans, and affirmed. On 3tareh 10, 1896, Allan Macdonell reported to the County Court of 3Vebb County that the conveyance taken to himself from Thomas C. Sheldon for all of the land named in the deed of trust was for the benefit of the estate of C. 31. 3Iacdonell, and that the consideration was paid by him as administrator of the said estate,. asking the court to take charge of the land as the property of said estate, and after due notice given according to law, the court entered an order directing the administrator to take up the said property. October 20, 1896, Allan Macdonell resigned as administrator, and on the same day A. B. Frank was appointed administrator de bonis non of the estate of C. M. Macdonell, deceased, and there being then pending an application for the sale of all the property of the estate, the court entered an order directing it to be sold, which was done by the administrator, it being purchased by defendants in error, Milmo and Urbahn. The sale was confirmed and deed made according to law. The American Freehold Land 3Iortgage Company instituted this suit in the District Court of 3Vebb County on the 22d day of January, 1897, against Daniel Milmo, Albert Urbahn, A. B. Frank, S. Lavenberg, and Allan 31acdonell, to recover of the last named upon his agreement to *404 pay the several notes given by C. M. Macdonell and Thomas Sheldon, secured by the deed of trust before stated, aggregating the sum of $22,-000 besides accrued interest, and seeking to foreclose the deed of trust originally executed by C. M. Macdonell and Thomas C. Sheldon upon the land described in the petition. The District Court entered judgment against Allan Macdonell for the amount of the several notes and interest unpaid thereon, with 12 per cent interest per annum from the date of that judgment, finding that the deed of trust made by Macdonell and Sheldon upon the land described in the petition was valid and foreclosing it upon the undivided one-half interest of Sheldon, but refusing to foreclose the said deed of trust upon the half which once belonged to C. M. Macdonell. The judgment of the District Court was affirmed by the Court of Civil Appeals. The facts in this case show beyond controversjr that the plaintiff in error is entitled to recover of Allan Macdonell its debt and interest and to have the lien and its deed of trust foreclosed as to all of the defendants in error, unless one or both of the following propositions presented by the defendants in error be correct: 1. It is claimed that the judgment of the Circuit Court of the Dnited States, in the case of Graham v. Allan Macdonell et al., in which Graham sued to recover the land in controversy in an action of trespass to try title, constitutes a bar to this action. 2. It is claimed by the defendants in error that the deed from Thos. C. Sheldon and wife to Allan Macdonell and the order of the probate court upon the report and application of Allan Macdonell vested the title to all of the land in the estate of C. M. Macdonell, deceased, and that foreclosure upon the land and the enforcement of the debt could not be had except in the County Court in the course of administration of that estate. In an action of trespass to try title, brought by Graham for the use of the mortgage company against Allan Macdonell and the other defendants in error in the Circuit Court of the Dnited States, judgment was rendered in favor of the defendants for the reason, stated in the judgment, — that the plaintiff had not proved a “cause of action.” The petition in that suit contained the allegations usual in trespass to try title, and in addition set up specially the making by C. M. Macdonell and Thos. C. Sheldon of the deed of trust upon the lands described, and the death of the trustee, the appointment of a substitute trustee, and the sale by him, under the deed of trust at which Graham purchased the property and received a deed. It was alleged that C. M. Macdonell had died, his estate was administered upon by Allan Macdonell, and that the County Court of Webb County ordered the administrator to sell the property to Thos. 0. Sheldon upon terms named in the order, which was done by the administrator and the land was conveyed to Thos. C. Sheldon, which action was approved by the County Court in accordance with article 1987, Revised Statutes. It was alleged that Thomas C. Sheldon conveyed the property to Allan Macdonell by a deed in which the *405 latter assumed and agreed to pay'tke debt due to the mortgage company from C. M. Maedonell’s estate and Thos. C. Sheldon; also $20,000 which Sheldon had agreed to pay the estate for C. M. Macdonell’s interest in the land, besides other sums not necessary to mention; and that Allan Macdonell entered into a separate written obligation in which he bound himself to pay the said sums .to the different parties. The defendants pleaded the facts generally as stated in the petition and claimed that the conveyance from Sheldon to Allan Macdonell was for the benefit of the estate of C. M. Macdonell; that it was approved by the County Court of Webb County and vested the title in the estate; that at the time of the sale under the deed of trust, both of the makers were dead and the said sale was void. The issue joined was distinctly that the sale made under the deed of trust upon which the plaintiff’s title depended was a nullity, which was decided against the plaintiff and is binding upon all parties to that suit, but it does not conclude investigation into any collateral issue or matter of inference arising in the course of that proceeding. James v. James, 81 Texas, 380; Oldham v. McIver, 49 Texas, 570; Philipowski v. Spencer, 63 Texas, 606; Horton v. Hamilton, 20 Texas, 606. The Court of Civil Appeals properly held that the judgment pleaded constituted no bar to this action. Before the year expired after the grant of letters of administration upon the estate of C. M. Macdonell, within which the mortgage company might have presented to the County Court of Webb County its claim against the estate of C. M. Macdonell and might have established the lien upon the land, that court, upon the application of Allan Macdonell, authorized and directed him, as administrator of the said estate, to make a compromise with Thomas C. Sheldon, whereby the administrator should sell to Sheldon the interest of the estate of C. M. Macdonell in the land embraced in the deed of trust for the sum of $20,000, and upon a further consideration that Sheldon would assume and pay the indebtedness of the estate to the mortgage company upon the note secured by the deed of trust on the land conveyed. The conveyance made to Sheldon passed the title to the land out of the estate of C. M. Macdonell and beyond the jurisdiction and control of the County Court. The sale and conveyance from Thos. C. Sheldon to Allan Macdonell and the promise of the latter to pay the debt vested in the mortgage company and Sheldon a right to enforce the debt against Allan Macdonell and the land superior to the lien reserved in favor of C. M. Macdonell’s estate, and, by the proceedings in the County Court, the administrator could not rescind the sale to Sheldon without the consent of the latter and of the mortgage company. The separate obligation of Allan Macdonell clearly expresses his individual liability for the debts named; the conveyance of the land was made to him personally; they are not open to explanation by parol testimony nor to interpretation by the court. It is not necessary for us to determine whether the proceedings in the County Court vested title to the land in the estate of C. M. Macdonell as between it and the ad *406 mmistrator, but it is clear that such proceeding could not divest the mortgage company of its right of action against Allan Macdonell nor of its right to foreclose the deed of trust by suit against him and all other parties who might claim adverse interest in the land. The facts in this case show that Allan Macdonell took and held the title in his own name until nearly three years after the transaction, and after suit had been filed in the United States Circuit Court for the recovery of the land, — the time for establishing the lien in the course of administration having expired, — he sought by an ex parte proceeding to shift liability to the esfate and to restore the land to the control of the County Court. To permit Allan Macdonell, by shifting the matter from one jurisdiction to another, and into and out of the same court, to destroy the lien upon the land and defeat the collection of the debt, would discriminate against the fair and orderly administration of the law. We are of opinion that the American Freehold Land Mortgage Company of London, Limited, is entitled to recover of Allan Macdonell the debt, interest, and attorney’s fees upon the note sued on and to foreclose the lien of the deed of trust upon all of the land described therein as against all of the parties to this suit, and it is ordered that the judgments of the District Court and Court of Civil Appeals be reversed and that judgment be here rendered in accordance with this opinion. Reversed and rendered.