Court Opinion

ID: 9826944
Source: CourtListenerOpinion
Date Created: 2023-09-01 17:00:41.99658+00
Date Added: 2024-06-11T07:42:19.980134
License: Public Domain

On Motion for Rehearing.
In our opinion we said there was nothing in the record to indicate that the bank was not a holder of the note in due course.
Appellants submit that in so holding we are in conflict with Taylor & Co., Inc., v. Nehi Bottling Co., 30 S.W.(2d) 494, 495, by the Dallas court. After a careful study of the case we think we ai-e not necessarily in conflict with that ease. The rule stated in the case depended upon certain facts established by the defense. The suit was upon a negotiable promissory note. Appellant pleaded that it was a holder in due course, that it took same in good faith for value and without notice of any infirmity or defect in the title.
The appellee joined issue on appellants’ allegations and pleaded specially that appellant was not a holder in due course and that the consideration for the note had failed. In discussing the case Judge Looney,, in referring to the facts found by the jury, said that the appellee (the maker of the note) “established its plea of failure of consideration,” and when that was done “the burden shifted, and it was then incumbent upon plaintiff (appellant) to show that it was holder in due course, that is for value, and without notice of any vice in the instrument,” and referred to section 59, of article 5935, of the Negotiable Instrument Act. The court, in the opinion, held that appellant had not discharged the burden indicated, and for that reason the case was affirmed.
There is, in our opinion, no determination of any fact by the' court or jury in the instant case such as to make applicable the above portion of the Taylor & Co. v. Nehi Bottling Go. Case.
We are in harmony with the second part of the court’s opinion in the case, as found in the opinion on rehearing.
The reading of the statement of the case of Hart v. West et al., 91 Tex. 184, 42 S. W. 544, referred to by appellant, sufficiently shows that it is not in point. Certainly there is no element of fact or evidence in this case that the note sued on was put in circulation through fraud or collusion between the bank, the ¡holder of the note, or any of the in-dorsers. The statement of the law of the *899case by the court is necessarily based on the facts found in the statement made by the court,
The uncontroverted record evidence here shows that the note sued on was executed on January 7, 1932, and sold to the bank on February 3, 1932, and that it was in May, 1932 (their answer alleges that about the 1st of July, 1932, the evidence shows appellants operated the property until July 20, 1932), before the. -appellants themselves with the books and all the opportunities for disclosing the facts discovered that the properties were not worth the value of the note they paid for the property. Appellants made five payments on the note; the last having been made in June, 1932. »
The representations alleged to have been made by Taylor Emerson and John O. Beck, as inducing the purchase of the properties, are substantially as follows: That the renewable insurance business of the two agencies was shown on the books of the concerns to be and then amounted to the sum of $3,500 in the current year ending that day (January 7, 1932), and that the business was then and there worth $3,500. The allegation then is, that contrary to such representations, $2,203.20 of said business was- not renewable and most of which was then already canceled. The evidence tends to show that the value of an agency for sale is -based on the renewable fire insurance premiums on the books.
The real estate conveyed and the fixtures were worth about $700.
The evidence shows that an insurance business with $3,500, renewable insurance would be worth $3,500. The evidence tends to show, by the books, that the totals for each month of 1931 amounted to $2,203.20, with an excess commission of $95.28 charged off. To the question: “Do you know-what the total business of all kinds that year (19-31) was of the Big Lake Insurance Agencies? witness had answered: A total of $4,227 and some odd cents.”
The evidence does not show the value of the agencies other than the above. To show the value of the agencies at the time the note was given appellants asked the appellant H. L. Puckett the questions: “Do you know whether the agency 'had any actual value at that time,” to which the witness would have replied: “Do you know whether or not the agency had any value of any bind?” To which the witness would have made the same answer: “I do, it did not.” It was objected ' on the 'ground that the witness could not differentiate between actual and market value after the witness had said it did not have a market value; and for the reason that witness had not qualified. The court sustained the objection. We think the witness should first ¡have qualified to state a value or no value.
We doubt whether the statements of Taylor Emerson and John O. Beck, found in the evidence, as to the value of the properties amount to such misrepresentations of fact as would afford the relief asked. The law makes allowances for the tendencies of men to exaggerate the value or the merits of their property when offered for trade. This character of representation borders on opinion rather than the assertion of a fact, and the rule is that mere matters of opinion expressed in the formation of contract will not avoid them, though the opinion proves false. Simpkins on Contracts and Sales, p. 121. In Varner v. Carson, .59 Tex. 303, 305, Chief Justice Willie said: “It is no doubt a general rule, both in law and equity, that misrepresentations of value, either present or prospective, are mere matters of opinion, and no relief is afforded to those who are deceived -by them.”
The syllabus in Long v. Gilbert (Tenn. Ch. App.) 59 S. W. 414, a ease in which a statement was made as to the value of bank stock, and misrepresentation as to value was shown, states: “Fraud cannot be based on a mere matter of opinion as to value stated in good faith.”
To illustrate the lack of probative force for reason of uncertainty of a bare opinion in the instant case, witness H. L. Puckett testified that the property involved had no value, and yet the records show the property was sold to Mr. Greenwood for $2,000 to be credited on the judgment. Other evidence shows the real property and the fixtures, a part of the property involved, had a value of $700.
We have concluded that while some of the representations made tending to show value might be construed as statements of facts, the representations as to value, as a whole, might be taken as only expressions of opinion.
There are some expressions in the opinion not justified by the record, but we do not regard them as important or controlling and will not undertake to correct them.
However, we were in error in stating that the action of the court overruling the objection to the admission of the note in evidence on the ground of variance was not embraced in the statement of facts. On a more careful examination of the record we have concluded *900that the record is such as to necessitate a consideration of the action of the court in overruling appellants’ objection to the admission of the note in evidence.
The petition alleges that the note was executed and delivered on January 7,1982. The note offered in evidence shows the date of its execution to be January 7, 1932. The due date of the first installment was stated to be on or before the 15th day of January, 1932. On that installment date January was erased by a line drawn through it and the abbreviation “Feb.” written with pencil above it.
The objection to the introduction of the note in evidence was as to the alteration in the note without explanation as to when or by whom the alteration was made, “and it does not agree with the copy filed with plaintiff’s petition,” that there is a variance between the original note (then offered) and the copy filed with the petition. The objection was overruled and the original note was put in evidence, to which appellants excepted.
The proposition (No. 5) presented is: “The alteration, apparent on the face of the note here in evidence, destroyed all possibility (if any) of its ever being rendered negotiable.”
It will be noted that the proposition does not suggest any ground of variance between the copy of the note filed with the petition and the original note then being offered in evidence, but suggest only that the alteration noted destroyed the negotiability of the note.
But we will consider its admissibility and the effect of the alteration.
The petition does not, by any statement, mate the note a part of the petition so as to bring it within the rule that an instrument which is sued upon, if made a part of the petition and filed with it, controls and cures any misdescription of it in the body of the petition, as announced in Bongley v. Caruthers, 64 Tex. 287; Varn v. Arnold Hat Co. (Tex. Civ. App.) 124 S. W. 693, and other cases. But we hardly think, and it is not contended, that the change, not of the date of the note, but of the due date of an installment payment, operated as a surprise to appellants; nor do we think that the alteration could have misled the appellants to their prejudice, and they do not so claim. What we have said applies only to the objection to the admissibility of the note on the ground of variance.
The change of the date of the first installment payment presents a more serious question on the question as to its effect on the note. While we think the change in the date from January to February might have been to correct an error as to date and to state the correct and intended date, still it is an unexplained change in the date. While the statute, section 125 of article 5939, provides that a negotiable instrument is discharged by any alteration which changes the date, a change made by consent, as in Cottle v. Sanders (Tex. Civ. App.) 40 S.W.(2d) 979; Funkhouser v. Chemical Bank & Trust Co. (Tex. Civ. App.) 53 S.W.(2d) 146, 151, or innocently made without any actual intention of perpetrating a fraud upon the maker, as in Stephens v. Anson Motor Co. (Tex. Civ. App.) 21 S.W.(2d) 699, or where the alteration was immaterial, Vackar v. Supreme Lodge (Tex. Civ. App.) 52 S.W.(2d) 655, and otter cases we have reviewed, the alteration may not discharge the instrument. But the rule is well established that a party offering an instrument must account for its condition, Cottle v. Sanders, supra ; the presumption being that the party in possession made the alteration. Occidental Life Ins. Co. v. Jamora (Tex. Civ. App.) 44 S. W.(2d) 808, 811. The alteration in date of payment of the installment being unexplained in the record, and possibly being a material change, Caldwell National Bank v. Reep (Tex. Civ. App.) 188 S. W. 507, we have concluded that on that ground the motion should be granted, the case be reversed and remanded, and it is so ordered.
'Reversed and remanded.