Court Opinion

ID: 9829930
Source: CourtListenerOpinion
Date Created: 2023-09-01 19:44:10.734717+00
Date Added: 2024-06-11T07:43:09.040947
License: Public Domain

On Motion for Rehearing.
On motion for rehearing, appellant urges upon our attention the case of Gilmore v. O’Neil, 107 Tex. 18, 173 S. W. 206, in support of its proposition that, independent of the reformation of the deed of trust and subsequent proceedings, the appellant held a superior equitable title to the land that entitles it to prevail in this suit. In the case referred to, James Jones sold to Mrs. Dewey a certain tract of land, but the deed, by mistake, failed to include a part of the land intended to be sold. The entire consideration was paid and the defendant O’Neil, a subsequent grantee of Mrs. Dewey, went into possession, placing valuable improvements on the portion of the land intended to be sold but not embraced in the deed to Mrs. Dewey. These facts being shown in a suit in trespass to try title to the said portion of land not included in the deed, in which suit O'Neil was defendant, and the plaintiffs were claiming under Mrs. Jones, were held sufficient to vest an equitable title in O’Neil, which enabled him to prevail; and it was further held that the reformation of the deed was not essential to the establishment of O’Neil’s defense, because under the circumstances he acquired an equitable title to the land, independent of the deed. • This ruling was evidently on the theory that one purchasing land on oral contract, who pays the consideration therefor, goes into possession, and makes valuable improvements, acquires an equitable title thereto, notwithstanding the statute of frauds. So that O’Neil, under the circumstances, could ignore the deed and found his right on the oral contract followed by payment of the purchase price, possession, and improvements. Before proceeding further with the application of this case to the one at bar, it will be well enough to understand the limits within which an oral contract for the sale of land will be held to confer an equitable title therein.
[4] There are many cases on the subject, but the following will be sufficient for the purposes of this opinion: Ann Berta Lodge v. Leverton, 42 Tex. 23; Bradley v. Owsley, 74 Tex. 69, 11 S. W. 1052; Id., 19 S. W. 340; Page v. Vaughn, 173 S. W. 543; Terry v. Craft, 87 S. W. 845. These authorities establish: First, that “when a verbal contract, I whether fully or partially executed, is relied *340upon in our courts, though merely by way of defense against the legal title, the laboring oar is upon the defendant, and he must make out such a case as would entitle him to a decree of title, if he were seeking it.” Second, that possession and payment of the purchase price alone, under an oral contract of purchase, are not sufficient to establish such a title, but the possession must be accompanied by valuable improvements, placed on the land on the faith of the purchase.
As ruled by these authorities, how stands the right of the appellant, independent of the written instruments, that do not describe the land and which cannot avail it without a reformation thereof? Its position would be that of possession with no improvements made under such possession, following an oral mortgage with no foreclosure thereof. We need not digress to ascertain what might be the rights of appellant if its possession was by. reason an ineffective attempt to foreclose a valid mortgage, because the oral mortgage, like an oral sale, falls within the terms of the statute of frauds. Poarch v. Duncan, 41 Tex. Civ. App. 275, 91 S. W. 1110; Castro v. lilies, 13 Tex. 235; Boehl v. Wadgymar, 54 Tex. 589; Johnson v. Portwood, 89 Tex. 235, 34 S. W. 599, 787; R. S. art. 1103. If the oral agreement to create a lien on the real estate could be held to create any equitable title under any circumstances, it would only be on the same theory that an oral sale may, under certain circumstances, vest an equitable ownership in the land, which the law will recognize. Under the authorities cited, appellant could not prevail in the suit, even if he had purchased the lot by verbal sale from Dunaway, paid the entire consideration, and went into possession, because it is not shown that it has placed valuable improvements thereon. If a verbal sale under the circumstances would not vest an equitable title in appellant that would enabie it to defeat the trespass to try title suit, we do noi see how it could be held that a verbal mortgage could have that effect.
[5] We are requested by appellant, in the event we should otherwise hold against it, to reverse and remand the case to the end that a reformation of the deed of trust may be had, followed by its foreclosure, as reformed, on the ground that appellant, having set up all the necessary facts, is entitled to this relief under its general prayer. This matter received our attention on original hearing, though it was not mentioned in the opinion. If all the parties necessary to such relief were in the ease and all the facts necessary to such relief were pleaded, we would consider it our duty to examine further into appellee’s claim that such action could not be had in any event, because they are innocent purchasers without notice, and, if we should determine that the appellee’s claim is not well founded, then to reverse and remand tho case as suggested. We are of the opinion, however, that the heirs or representatives of Dunaway are necessary parties to any proceeding to reform the mistake in the deed of trust and to foreclose the same. City of Brownsville v. Tumlinson, Í79 S. W. 1110; Weems v. Sheriff, 48 Tex. 481; Jones v. Nix, 174 S..W. 685; Cyc. vol. 34, pp. 966, 967; Gates v. Union Naval Store Co., 92 Miss. 227, 45 South. 979. Such action necessarily involves a cancellation of whatever credit resulted on the judgment against Dun-away by the former sale and a foreclosure of the indebtedness against said lot No. 6, and sale under such foreclosure. Those entitled to the Dunaway estate are necessarily affected by such proceedings. We also doubt whether all the facts necessary to such relief were pleaded or shown, there being no showing as to the balance, if any, due on the judgment, so that there were no allegations as to the amount of the indebtedness for which a foreclosure could be had. It must he borne in mind that the issue tendered by the petition of trespass to try title was one of title and the pleading of the facts of mistake by defendant was also on the issue of title; the pleader’s conclusion following a statement of these facts being, “that by reason of the premises this defendant has a superior legal and equitable title to the above mentioned and described property to that of plaintiff,” etc., its prayer being that the plaintiff take nothing, that the defendant go hence without day and recover all costs and for general and special, legal and equitable relief.
[6] The right of reformation of the deed of trust and foreclosure anew was independent of the issues in the trespass to try title suit, but which, if all the necessary parties were before the court and the proper allegations had been made, the defendant could have litigated in a cross-action. Authorities above cited, and Burks v. Burks, 141 S. W. 337; Moore v. Snowball, 98 Tex. 16, 81 S. W. 5, 66 L. R. A. 745, 107 Am. St. Rep. 596. But because, in the trial of the issue of title, facts are incidentally shown which might, if the proper parties were in the case, justify the granting to defendant of affirmative relief on such a cross-action, the court below was not required on its own motion to stay the trial of the issue of title joined by the parties, and require the making of additional parties in order that the rights thus incidentally disclosed might be tried, and we do not think we would be justified at this stage of the proceedings in reversing the case for this purpose.
The other matters urged in the motion for rehearing ¡were disahssed in our original opinion, to which we adhere.
The motion for rehearing will be overruled.