Court Opinion

ID: 9829044
Source: CourtListenerOpinion
Date Created: 2023-09-01 18:56:57.623081+00
Date Added: 2024-06-11T07:42:56.741444
License: Public Domain

On Rehearing.
Plaintiffs in error present a well argued motion for rehearing, in which the grounds .originally urged for reversal are again presented, but our concern is only with reference to allegations that challenge the correctness of certain of our findings of fact.
Plaintiffs in error say that “should the court on reconsideration of this case adhere to its conclusion, that McGeorge is an innocent purchaser and has proved estoppel, then we respectfully request the court to set forth the evidence on which such finding is based.”
The facts, upon which we held that plaintiffs in error were estopped to plead usury in avoidance of the foreclosure sale and trustee’s deed conveying the interest of Robert Davis in the land to the Oklahoma Farm Mortgage Company, are fully set out in the original opinion, and, as the record was exhausted with reference to the grounds of estoppel discussed, we aTe unable to say more, however, we think there exists still another reason why plaintiffs in error were estopped to insist upon usury in avoidance of the instruments above mentioned.
At the time Messrs. Bookhout and Hol-ifield purchased and took conveyances of the oil, gas, and other minerals in the land, they were informed by Davis that the land was then under mortgage to the Oklahoma Farm Mortgage Company to secure an indebtedness ; they understood that Davis recognized the validity of the loan and the deeds of trust securing the same, and purchased subject to and in recognition of the validity of the trust deeds held by the mortgage company; the records disclosing that, at that time, the second trust deed had been foreclosed and the land conveyed to the loan company, of which fact Bookhout and Hol-ifield had constructive notice.
These facts, in our opinion, show that - Bookhout and Holifield took conveyances from Davis subject to the loan and rights of the mortgage company, hence impliedly agreed that the lien was valid, and thereby estopped themselves and those claiming under them, to thereafter dispute that fact. One purchasing real estate with knowledge of the existence of and in subordination to a mortgage, although the mortgage, as to the vendor, may be void, is bound thereby, and is estopped to thereafter dispute the validity of the lien. This doctrine was announced in Rice-Stix, etc., Co. v. First National Bank, 231 S. W. 386, 388, where the Commission of Appeals held that a purchaser of land, with knowledge that the vendor *521recognized as valid an existing lien, was estopped to challenge its validity, although the property conveyed, upon which the lien existed, was in fact the homestead of the vendor. Judge Spencer, speaking for the commission on this occasion, said: “The un-controverted facts showing that the bank took the property subject to the record, which revealed the lien and with knowledge that Gullidge [vendor] recognized the lien as security to protect his indebtedness, it [the bank] is, as a matter of law, under such facts, estopped to deny the validity of the lien and the mortgagee is therefore entitled to a judgment of foreclosure.” To the same effect see Wooten Motor Co. v. First Bank (Tex. Com. App.) 281 S. W. 196, 197. We hold therefore that, for this additional reason, plaintiffs in error are estopped to raise the question of usury.
Plaintiffs in error also request that, should we adhere to the conclusion that Mc-George is an innocent purchaser, that we set forth the evidence on which such finding is based, and, in this connection, they say: “We do seriously challenge and take exception to the general statement of the court running through its entire opinion that McGeorge was an innocent purchaser, and as such was entitled to rely on the records”; again they challenge the correctness of our statement (page 3 of opinion [65 S.W.(2d) 514]) to the effect that, subsequent to the purchase of the property, McGeorge paid off the first lien existing upon the property, amounting to $2,900 and interest, and obtained a deed from Davis and a deed from Archie Blount, all without notice of facts other than as disclosed by the record. Pursuing this line of thought further, plaintiffs in error argue that “the undisputed testimony and McGeorge’s own admission showed that at the time he first came in contact with Davis, Davis was in possession of the land, and McGeorge knew it. In addition to such notice as will be carried by possession, Davis told McGeorge in unqualified terms that he still owned and claimed the land. In view of this fact, how could Mc-George have relied upon an apparent title in someone else? To be more specific, how could he have relied on an apparent title in Blount under the instrument given him, assuming that it was regular on its face, and how could he have relied on any apparent title in Oklahoma ‘ Mortgage Farm Company by virtue of their foreclosure? * * * McGeorge did have notice outside the record of the possession of Robert Davis and his assertion of title despite the fact that he had given a deed to Blount and a foreclosure sale had been made to Oklahoma Farm Mortgage Company. Furthermore, the evidence raised an issue not submitted to the jury and waived by defendant in error McGeorge to the effect that McGeorge had actual notice of the claims of Bookhout and Holifield under the second mineral deed.”
It is true that, at the time (April, 1921) Davis applied to McGeorge for a loan on the land, Davis was in possession, falsely claiming to be its owner, in the face of records disclosing that all his right, title, and interest had, on March 17, 1921, passed to. the loan company under the foreclosure, and that even prior to that date (February 9, 1921) he had conveyed the land to Archie Blount. Thus, it appearing that, prior .to the time McGeorge was requested-to make the loan, all of Davis’ right, title, and in-' terest in the land had passed to others (under whom McGeorge claims), hence,- in. such-a situation, we hold that McGeorge was neither required to take notice of, nor to inquire or investigate for facts, other than as disclosed by the record. This doctrine is well established in this state. See Eylar v. Eylar, 60 Tex. 315; Hawley v. Geer (Tex. Sup.) 17 S. W. 914, 916; Watkins v. Sproull, 8 Tex. Civ. App. 427, 28 S. W. 356; Hickman v. Hoffman, 11 Tex. Civ. App. 605, 33 S. W. 257.
In the original opinion we stated, and here reiterate, that while th'e evidence was conflicting as to whether the conveyance from Davis to Blount was intended as a sale or a mortgage, that McGeorge had no knowledge of the existence of these extraneous facts, hence, necessarily relied upon the record disclosures, and in this sense we think he was an innocent purchaser as to the Blount chain of title.
Having fully considered all grounds urged by plaintiffs in error for rehearing, the same are overruled.
Overruled.