Court Opinion

ID: 3907683
Source: CourtListenerOpinion
Date Created: 2016-07-06 09:36:52.381423+00
Date Added: 2024-06-11T07:42:29.473585
License: Public Domain

The plaintiff, Arnold, administrator of the estate of Ed Eaton, sued the defendant, Peoples, and charged in his petition, that on the 21st day of September, 1886, said Eaton executed and delivered to Peoples, as accommodation paper, his promissory note for $1800, due and payable September 27, 1887; that at the same time Eaton executed a trust deed conveying a tract of land to secure said note, making one E.C. Ross, the trustee therein; that said Ross sold the land to satisfy said note, and Peoples became the purchaser thereof, and thereafter sold it for $3000; that at the time Eaton executed said note he did not owe Peoples anything, and that thereafter Peoples executed to Eaton a note, dated January 1, 1887, due October 1, 1887, for $1800, as an offset to the aforesaid note and mortgage executed by Eaton; and the plaintiff asked for judgment on the latter note, and for $1200, the excess for which Peoples had sold the land.
Among other things, the defendant pleaded that the note sued on was given as a consideration for the aforesaid note and deed of trust executed by Eaton; that Eaton was insolvent, and executed said note and trust deed and received the note sued on for the purpose of defrauding his creditors. In replication the plaintiff pleaded that the defendant was estopped, because in a former suit between one of Eaton's creditors, as plaintiff, and Eaton and Peoples, as defendants, Peoples had alleged in his answer that said transactions were in good faith and without fraud. A verdict and judgment were rendered for Peoples, and Arnold has appealed.
The third assignment of error if the only one presented in appellant's brief that complains of the verdict; and it asserts that the evidence fails to show that at the time Eaton executed the note and trust deed to Peoples, he was insolvent, "or financially involved in any material amount or sum."
It was not absolutely necessary that Eaton should be insolvent to render the transaction fraudulent. A solvent debtor may transfer his property *Page 29 
with intent to defraud creditors. Rev. Stat. (1895), arts. 2544, 2545; LeGierse v. Whitehurst, 66 Tex. 245.
Tom Peoples, defendant, testified: "That on the 21st day of September, 1886, when Ed Eaton gave the $1800 note, and deed of trust to W.C. Ross to secure the same, Eaton and Stirman were partners, and their financial condition was bad, they were indebted about $3500, and their creditors were pressing. They were in business at McGregor, Texas, and about that time were closed out to Frieberg, Kline  Co. I afterwards bought the stock from Frieberg, Kline  Co. Eaton and Stirman also owed Hughes Brothers, also King and Fordtran, and Edel Brothers, and Eaton owed M. Terry. These creditors were pressing for their claims."
In view of this testimony, and other facts tending to show that Eaton was unable to pay his debts, one of which was in the form of a judgment, in 1887, we cannot sustain the third assignment of error.
The plaintiff asked the following special charges, both of which were refused: 1. "Gentlemen of the jury, you are charged by the court that if you believe from the evidence that the said Eaton made, executed and delivered to said Peoples his certain promissory note and deed of trust, of date September 21, 1886, in settlement of a debt honestly owed by said Eaton to said Peoples at that date, notwithstanding you may believe from the evidence that said Eaton's purpose was to prevent the property described in said deed of trust from being subjected to the claims of other creditors of said Eaton, and you believe from the evidence that the said Peoples made, executed and delivered to said Eaton his certain promissory note of January 1, 1887, the note sued on herein by plaintiff, you may find for the plaintiff."
2. "Notwithstanding you may believe from the evidence that Edward Eaton made, executed and delivered to said Peoples his promissory note and deed of trust, dated September 21, 1886, for the purpose of hindering, delaying and defrauding creditors, yet if you believe from the evidence that on the first day of January, 1887, said Peoples made, executed and delivered to said Eaton his certain promissory note, the note sued on herein by plaintiff, and that the same was so made, executed and delivered by said Peoples as an honest and legitimate settlement between said Peoples and said Eaton, you will find for the plaintiff."
The plaintiff had alleged and thereby admitted in his petition that Eaton did not owe Peoples anything at the time the former executed the note and trust deed; and the note executed by Peoples shows on its face that it was given to offset the note executed by Eaton. Therefore the plaintiff was precluded by his pleading from claiming that the note executed by Eaton was given in settlement of a debt owing by Eaton to Peoples. Besides, there was no evidence tending to show the existence of such debt or settlement. Therefore the court properly refused the first instruction.
If it was the purpose of the second charge quoted to tell the jury that, *Page 30 
although a debtor may convey his property for the purpose of defrauding his creditors, yet, if his vendee and accomplice afterwards executes a note or other executory contract promising to pay for the property so conveyed, that the courts will enforce such a contract, then it was properly refused, because such is not the law. Davis v. Sittig, 65 Tex. 498; Seligson v. Lewis,65 Tex. 215. And if the intention was to instruct the jury that if the note sued on related to, and was given in settlement of, other matters disconnected from the note and trust deed executed by Eaton, then it would be legal and binding, it was properly refused, because the plaintiff, in his petition, linked the two transactions together, and there was no evidence tending to show that the note sued on was given in settlement of any other matter.
The refusal of the court to give the plaintiff's special charge upon the subject of estoppel is not shown to be reversible error.
The answer filed by the defendant in the other suit, and which answer it is alleged, estopped him from pleading fraud in this case, is not set out in the statement of facts, and therefore we cannot determine whether or not it would estop Peoples.
The court's charge has been examined in the light of the criticisms urged against it, and our conclusion is that the objections to it are untenable.
This disposes of all the questions presented in the briefs, and the judgment will be affirmed.
Affirmed.