Case Name: Todd and others v. Caldwell and others
Court: Supreme Court of Texas
Jurisdiction: Texas
Decision Date: 1853
Citations: 10 Tex. 236
Docket Number: 
Parties: Todd and others v. Caldwell and others.
Judges: 
Reporter: Texas Reports
Volume: 10
Pages: 118–122

Head Matter:
Todd and others v. Caldwell and others.
Where the vendee, in an executory contract for the sale of land, fails to pay the purchase-money at the time stipulated, and especially where ho has given a draft for the purchase-money on a person in whose hands he has no funds, and tiie draft has not been paid, the vendor may elect to abandon the contract; and this, too, in the latter case, although the draft may havo been indorsed to a creditor of the vendor, to he credited when paid; and where the vendor has so elected to abandon the contract, it cannot be sustained or resuscitated by any agreement between the vendee and the creditor of the vendor, to whom the draft was indorsed.
The probate court has jurisdiction (Hart. Dig., art. 1102) to decree the specific performance of executory contracts of a decedent for the sale of land; but any person interested in the esrate may, at any time within two years after tho making of any such decree, have the same annulled and set aside by a suit in the District Court, upon good cause shown why the same should not have been made in the first instance.
That time is of the essence of the contract, may or may not be true in reference to the facts in a given case. It has been well said that “ if the thing sold be of greater or less value, “according to the eillux of time, it is manifest that time is of the essence of the contract, “and a stipulation as to time must then be literally complied with in equity, as well as in “law.”
It is deemed unnecessary to enter upon a critical examination of the charge of the court. Ia its application to the facts of the case, it was substantially correct,
faction of the judgment of Glasgow and Harrison against Johnson’s estate. One thousand dollars was paid at the time, and Wortham gave to Harrison a note for the payment of the residue. Hudgins was examined as a witness, and stated that he had not paid the bill drawn by him on Spotts, and had no recollection of having- executed the note for the residue of the purchase-money. He left Texas for Virginia in June, 1846, and did not return until December, 1848. It was in proof that lie was insolvent at and before the making of the contract with Johnson. It was also in proof that the land was cheap at the price at which it was contracted for. aud that it increased greatly in value. It was further in proof that the petition of Wortham to the probate court was-drawn by Todd, the administrator of Johnson’s estate, aud defendant iu the petition. Harrison testified that lie considered the judgment in favor of Glasgow aud Harrison satisfied by the arrangement made in October between himself, Todd, and Wortham. The court instructed the jury, iu substance, that if the bill drawn in favor of Jolinson by Hudgins for the purchase-money of the land was protested for non-payment, Jolinson had a right to abandon the contract; and if lie did so, in fact the contract ivas at aii end, and was to be regarded as iE it had never existed; and that “whatever may have been done “by Todd, Wortham, and Hudgins at the time it was alleged Wortham pur- “ chased, was not binding upon the heirs and the representatives of Jolinson; ” that payment of the purchase-money was a condition precedent to the vesting of a right in Hudgins or his assignee; aud that time is of the. essence of the contract, unless waived by the party.
The defendant requested the court to instruct the jury that if payment had been made to the holder of the draft to his satisfaction “ before the' present “time, and if the sums specified in the contract have been paid to Johnson or “his assignee before the present time, they will find for the defendants; which “charge the judge gave, with the addition that the same would not apply if “Johnson had abandoned the contract in his lifetime.”
There was a verdict for the plaintiffs and a motion for a new trial, which the court overruled and gave judgment for the plaintiffs, annulling and setting aside the order of the probate court. The defendants appealed.
The errors assigned were the instructions of the court and the refusal of a new trial.
J. T. Mills, for appellants.
Morrill 8? Dichson, for appellees.

Opinion:
Wheelbb, J.
The questions presented for our consideration are, whether, upon tiie facts iu evidence, the District Court was authorized to annul the decree of the probate court; and whether there was any error in the instructions to the jury of a character to require the reversal of the judgment.
There can be no question that the inducement to the making- of the contract on the part of Jolinson had wholly failed before the period of performance by him arrived. Iludgius had practiced a fraud upon Johnson by drawing in his favor upon one in whose hands he had no funds, and without any good reason to believe his draft would be honored. He had failed to perform liis contract in every particular, aud his insolvency rendered his performance hopeless and his vendor remediless by suit to enforce the contract. The only recourse left him was to disaffirm and put an end to the contract. This he did ; and that, under the circumstances, it was his right to rescind the contract, cannot admit of a question. Certainly no court of equity would enforce a contract at the instance of the vendee under the circumstances of this case, nor would hesitate to decree its rescission at the instance of the vendor. (Story on Cont., 834, 977, 3d edit.; Story's Eq. Ch., 17, 18 ; 2 Kent. Ch., 39.)
Johnson, in his lifetime, rightfully treated the contract as at an end. And.' it was not within the power of third persons, by any agreement of theirs respecting its subject-matter, made after his death, and when his estate
Appeal from Bed Biver. The record disclosed that on the 15th day of May, 184(1, James'II. Johnson, since deceased, bnt then residing in Bed Biver county, entered into a contract with TIios. Hudgins, then o£ Virginia, lor the sale ol a tract of land containing forty-two lmndrod acres, which contract •contained (he following stipulations: "The said Hudgins agrees to pay the "said Johnson, or his order, the sum of three thousand six hundred dollars, "of which two thousand live lmndrod dollars are to be paid in four months •"from this date, and the remainder, of eleven hundred, on or before the first "day of January, A. D., 3848; and the said Johnson agrees on his part, when "the said Hudgins shall make the first payment according to the tenor of this " contract, and shall execute his note with good and sufficient security for the "remainder, that he will make a warrantee deed to the said Hudgins for said "tract of land, with all the improvements thereon; possession to be given on "the first of next January, or sooner if convenient."
For (he. first payment (of twenty-five lmudred dollars) stipulated in the contract Ilndgins drew a bill of exchange in favor of said Johnson on one Spotts, -of Virginia, payable at four mouths. The bill was duly presented at maturity, and protested for non-payment, and in December thereafter, Johnson elected wholly to disaffirm the contract, and advertised the land in question for sale. Johnson 'died in January, 1S47, without having effected a resale of the land; and in May, 1848, Todd administered on his es'tate. In May, 1849, Wortham, as the assignee of Hudgins, filed his petition in the probate court, in pursuance of article 1162 of the Digest, to obtain a decree authorizing the administrator of Johnson to make him a title to the land. The petition set out the contract between Johnson and Hudgins and its assignment to the plaintiff by the latter. • It stated that after the payment of the first instalment by the said Hudgins, and before tire maturity of the last, "Johnson departed this life, not " having made a deed to the land according to the terms of -his contract," &c. The administrator answered, expressly admitting the facts as stated in the petition, and adding that he believed it would be to the interest of the estate to carry out the contract by a specific performance. The probate court thereon gave judgment that the administrator make title in accordance with •the prayer of the petition.
The widow of Johnson, who had intermarried with Caldwell, jointly with her present husband and the heirs of her former husband, brought this suit, under the provision of the Digest, to annul and set aside the order of the pro-Ibate court.
The material facts disclosed by the record, in addition to those already stated, ¡are that at the time of the contract of sale Johnson was in embarrassed circumstances, and was pressed for money; that he owed debts to a considerable .amount, which lie was desirous to pay, and particularly a judgment in favor •of Glasgow and Harrison, recovered in 1844, for about thirty-eight hundred dollars; that upon receiving the draft before mentioned from Hudgins he .assigned and placed it in the" hands of Harrison, agent of Glasgow and Harrison, under an agreement that the amount, when paid, should be credited upon tlie judgment. On being protested the draft was returned to Harrison, who still retained it unpaid, and has not presented it as a claim against the estate of Johnson. Hudgins had no funds in the hands of Spotts, either at the date or maturity of the draft. There was an attempt to show that he " might have "supposed he had some claim" upon the drawee. It was also agreed between Johnson and Harrison that when Hudgins should execute his note with security for the balance of the purchase-money, as specified in the contract, he, narrison, •would receive and credit it upon the judgment.
In October, 1847, after the death of Johnson and before the appointment of ¡his administrator, an agreement was entered into between Todd, as the agent of Hudgins, and Wortham and Harrison, by which Todd assigned the interest of Hudgins in the. contract between him and Johnson to Wortham for the consideration of forty-six hundred dollars, to be paid to Harrison in satis- was unrepresented, to impart to that contract anew legal vitality, and render it obligatory on his estate. There conld not be the semblance of an authority in Todd, Wortham, and Harrison, by their agreement, entered into October, 1847, to créalo an obligation binding on Johnson's estate, or in any manner to affect the legal rights of the heirs aiid distributees of that estate who were not parties to that agreement. As to them, it was a mere nullity, whatever may-have been its effect as between the parties to it.
In Johnson's lifetime the contract would not have been enforced against him. After his death it was not obligatory upon his heirs and legal representatives. ITe had agreed with Ilarrison to appropriate, tlie proceeds of tlie sale of the land f.= Míe paya, -it of the judgment against him, of whi ;h the latter had control! But these p -•« needs were not received. ,J'he laud h..-l increased in value, and' i he relative : tnation of the parties may have been materially changed. Had' Johnson li\ ei!, it is not certain that he would have as-sented to tlie new arrangement for paj iug- that judgment. That, at least, would have been a question for his decision, and it is very clear that, after his death, and when he had no-legal representative, another could not make a contract for him which could be obligatory upon his succession.
When,"therefore, the suit was instituted in t}ie probate court to enforce specific performance upon tlie contract-, it was not legally obligatory on the estate, and had the suit been resisted and tlie facts truly presented, we must suppose the. court would have refused to decree a conveyance. Could the administrator, l>3'his admission in favor of one cognizant of tlie. facts, as it is evident tlie plaintiff in that proceeding must have been, divest the right of those interested in the estate? We think not. His voluntary conveyance of the property by private sale would have been ineffectual to pass the title. And it is not perceived that the having clothed it in the forms of a judicial proceeding can impart to what was, in fact and substance, but a private sale or transfer of the property of tlie óslate, any validity or-binding force, especially when brought in question under the statute, which divests the judgment of its conclusive character, and authorizes an inquiry into its merits.
Tlie agreement of October, 1847, was doubtless made, and the order of the probate'court to effectuate that agreement was obtained by the administrator of Johnson, under the belief that the best interest of the estate required that Harrison's judgment should be settled with tlie proceeds of this land. The administrator had no interest in bringing about that result, and no motive to-do otherwise, than discharge faithfully liis trust as the representative of the deceased. But though no fraud upon the heirs and creditors of the estate was in fa.et intended, and the motives of the administrator are free from tlie suspicion of unfairness, it cannot lie doubted that his acts, which are now brought iu qucslio-i, may liav.e operated as a franc! upon the rights of tiloso interested' in tlie (-state, and that tlie law will regard tlie transaction in that light. It was an attempted evasion of tlie legal principle that an administrator cannot transfer by prívalo sale the property of the estate. It was the doing of that, under the form and cloak of a judicial proceeding, which the law did not authorize. The law will not permit its forms to be thus employed to evade or subvert its principles. It will not sanction the attempt t-lms to cloak an unauthorized and-illegal act under its forms, though obtained at the seat of justice through the instrumentality of its officers. And this ground, it is conceived, was'amply sufficient to authorize the annulling and vacating of the order of the probate-court.
It was insisted in argument that the probate court had not jurisdiction under tlie statute to make the order in question. In this view we do not coincide. Tlie petition presented a case within the jurisdiction of the court, and it unquestionably was competent for the court to take cognizance of the case. But to entitle the plaintiffs to maintain their action to set aside the order of the probate court it is not necessary that it should have been made in a case of which that court had not jurisdiction, or that it should have been procured by fraud. It is sufficient if, in the language of tlie statute, good cause be shown why it should not have been made. (Hart. Dig., art. 1162; Jones v. Taylor, 7 Tex. R., 240.) That this has been done in the present ease is, we think, entirely free from doubt.
It is deemed unnecessary to enter upon a critical examination of the charge •of the court. In its application to the facts of the ease it was substantially correct. The instruction asked by the defendants and given by the judge with an addition might well have been refused as not authorized by the evidence, and as calculated to mislead the jury. That time is of the essence of the contract may or may not be true in reference to the facts of a given case. It has been well said that "if the thing sold be of greater or less value according to the efflux of time, it is manifest that timé is of the essence of the contract, and a stipulation as to time must then be literally complied with in " equity as well as in law." (2 Story Eq., 775, n. 1, 8th edit.) But in the present case the instruction upon this point was immaterial, for the reason that at the lime and under the circumstances of the case, the vendor had the right to rescind the contract, and no valid or binding act was afterwards done in reallirmanee of it. The instructions of the court may be obnoxious to criticism in other respects; but we see nothing in them considered in reference to the facts of a character to mislead or which it is conceived can have misled the jury.
The view we have taken of the case dispenses with the necessity of entering upon the examination of some interesting topics discussed in the very elaborate and able argument of counsel. We are of opinion that there is no error in the judgment, and that it be affirmed.
Judgment affirmed.