Scott v. Noakes

SMITH, J. In this cause the appellees, plaintiffs below, admitted having executed and delivered to the United Home Builders a series of installment notes, and a deed of trust upon certain land in Nueces county to-secure the payment of the notes. In consideration of the execution and delivery of these instruments the Home Builders agreed to loan appellees an amount approximating $2,-500. Appellees also admit that the Home Builders (hereinafter called the company) advanced to them the sum of $1,622 upon the obligation to make the loan, but contend that they have paid certain installments and are entitled to certain credits on the notes amounting to $1,076, so that the difference between the amount received from the company and the amount paid to the company is $546, which they aver a willingness to pay when judgment thereon is rendered. But the company through its receiver, claims the balance due it upon the contract is larger than that asserted by appellees, and this dispute, as a practical matter, becomes the only question in the case made by the pleadings below. The contract in question was made in September, 1921. Subsequently the company got into financial difficulties, and in January. 1923, appellant G. G. Wright was appointed and qualified as receiver of its affairs, under an order issued by the Sixty-eighth district court of Dallas county. Hearing of these difficulties, appellees suspended payments of installments upon their notes. In the meantime the securities here involved had been deposited as a part of the company’s legal reserve with the state commissioner of insurance, as provided by law in related cases. Appellees alleged that the receiver and the insurance commissioner were each contending that payments on the notes should be made to him, and appellees could not safely pay either until that controversy, as well as the extent of the amount due, was settled; that the notes and deed of trust provided for attorney’s fees, and a foreclosure of the deed of trust lien in event of default in the payment of any installment provided for in the notes; that the holder was threatening to declare a default, enforce the penalty, and foreclose upon the land. Appellees brought this suit against Wright, the receiver, and John M. Scott, acting commissioner of insurance, setting up the facts stated and praying for judicial ascertainment of the amount payable by them under the contract, which they averred a willingness to pay to the judicially ascertained holder. They also alleged the obvious fact that the notes and lien, and the record thereof, constituted a cloud upon their title to the land, and prayed that, upon ascertainment *736 by tbe court and payment by them of tbe amount for wbieb tbey are liable under tbeir contract, tbey be quieted in tbeir title. Appellees in tbeir petition also alleged tbat tbey were induced to execute and deliver tbe notes and deed of trust by certain representations, promises, and agreements made in Nueces county by tbe Home' Builders’ agent, but tbey did not allege tbat tbe representations of fact were false at tbe time made, or tbat tbey were fraudulently made; nor did tbey allege tbat tbe promises and agreements were fraudulently made with a present intention not to perform. ' In other words, tbe allegations as to statements, promises, and agreements did not present a case of actionable fraud. Appellees also pleaded, in general terms and in tbe form of a conclusion of tbe pleader, tbat there was no consideration, and a failure of consideration, for tbe execution and delivery of .the notes and deed of trust. Before appearance day of tbe term to which tbe cause was returnable, Commissioner Scott filed an answer through the Attorney General, alleging tbat, in response to an order of tbe district court of Dallas county, be bad theretofore delivered tbe securities in controversy to Receiver 'Wright. He also filed a disclaimer. Subsequently defendant Wright filed a plea of bis privilege to be sued in Dallas county, in response to which tbe plaintiffs below filed a controverting affidavit. Upon a bearing tbe plea was overruled, and Wright, the receiver, has appealed. It is conceded that the United Home Builders was domiciled in Dallas county, and tbat Receiver Wright resides in Dallas county, and Commissioner Scott in Travis county; in other words tbat none of tbe defendants below reside in Nueces county, where tbe suit was brought. Tbe notes in question were in express terms made payable in Dallas county, while tbe land conveyed in tbe deed of trust is situated in Nueces county. Venue o'f tbe suit is sought to be held in Nueces county upon tbe contentions: First, that this is a suit to remove incumbrance upon tbe title to real estate, and to remove cloud from such title, as contemplated in tbe exception to exclusive venue contained in subdivision 14 of article 1830, R. S. 1911; and, second, because tbe case presents one of fraud on tbe part of tbe Home Builders, as contemplated in tbe exception contained in subdivision 7 of article 1830. Tbe latter article, so far as applicable, reads as follows; Article 1S30‘: “No person, who is an inhabitant o-f this’state shall be sued out.of the county in which he has his domicile, except in the following eases, to wit: * * * 7. “In all cases of fraud, * * * in which cases suit may be instituted in the county in which the fraud was committed, * * * or where the defendant has his domicile. * * * 14. “Suits * * * to remove incumbrances upon the title to land, suits to quiet the title to land, * * » must be brought in tbe county in which the land, or a part thereof, may be.” Upon the bearing tbe parties introduced tbe answer of Commissioner Scott, the declaration of trust under which tbe Home Builders operated, appellees’ application to the company for a loan, tbe contract between tbe parties, tbe deed of trust and notes in controversy, and other documents not necessary to describe. The original pleadings were in evidence by reference. No testimony was introduced upon tbe issue of fraud; nor any oral testimony for any purpose. Tbe statute (article 1903, R. S. 1911), with amendments, prescribes the form and sufficiency of pleas of privilege, and when a defendant files such plea embracing tbe requisites there prescribed, as was done here, it presents a prima facie case for change of venue. Unless a controverting affidavit is interposed, tbe party claiming tbe privilege is entitled to have tbe cause transferred as a matter of course. When a proper controverting affidavit is filed, it has tbe effect of joining issue upon tbe facts showing venue, as to which tbe plaintiff becomes tbe primary actor and assumes tbe burden of affirmatively showing that tbe defendant is not entitled to claim the privilege guaranteed him by law. He must not only allege facts clearly showing tbe case comes within one of tbe exceptions to tbe exclusive venue in tbe county of defendant’s residence, but be must go further and establish those facts by evidence. Hilliard v. Wilson, 76 Tex. 180, 13 S. W. 25; Cloyd v. Sacra (Tex. Civ. App.) 175 S. W. 456; Masterson v. O'Fiel (Tex. Civ. App.) 219 S. W. 1117; Cannel Coal Co. v. Luna (Tex. Civ. App.) 144 S. W. 721. In this case tbe. allegations are deemed insufficient to show actionable fraud, but, if tbey had been sufficient for tbat purpose, there was no testimony to support the" allegation. There is nothing in tbe record, then, to bring tbe case within tbe seventh exception, based upon fraud. Nor was tbe case brought within tbe fourteenth exception, based upon suits to remove incumbrance upon title to real estate, or to remove cloud from title to real estate. Tbe suit of plaintiff below was to secure certain credits upon an obligation conceded to be valid and binding, to adjudicate differences between tbe parties as to tbe amount of tbe balance owing upon an obligation concededly valid and enforceable. And while it is true tbat tbe plaintiffs below set up tbe existence of tbe lien upon tbeir realty, alleged tbat it constituted a cloud upon tbeir title, and prayed that tbe incumbrance be removed and tbeir title quieted, after tbeir liability was adjudicated and tbey bad paid it off, the validity of tbat lien was not Brought in question, but was conceded. Tbe primary purpose of the suit was to determine tbe amount appellees owed appellant. Tbe *737 removal of the incumbrance upon the title to appellees’ real estate, and the quieting of that title, was an incident to the cause of action sued on, but was in no sense dependent upon its disposition, and the suit did not partake of the^ character of action contem-' plated in the fourteenth subdivision of article 1830. The order overruling appellant’s plea of privilege is reversed, and judgment is here rendered that the venue of this cause be changed from the' district court of Nueces county to the district court of the Sixty-Eighth judicial district of Dallas county; and the clerk of the district court of Nueces county is hereby directed to make out a correct transcript of all the orders in this cause, certifying thereto officially under the seal of the court, and'transmit the same, with the original papers in the cause, to the clerk of the district court of Dallas county. Reversed and rendered.