Court Opinion

ID: 9653559
Source: CourtListenerOpinion
Date Created: 2023-08-23 17:48:44.42193+00
Date Added: 2024-06-11T09:08:16.787007
License: Public Domain

On Motion For Rehearing.
Appellants, in their motion for rehearing, contend in effect that our opinion heretofore handed down is in conflict with this ■ court’s opinion in Hill v. Engel, 89 S.W.2d 219, 221 (opinion 1936, writ ref.). We do not so understand that opinion.
In that case Justice Alexander- said: “In order for appellant to invoke the intervention of equitable principles in his behalf, the burden was on him to at least allege and prove that, without any fault on his part, an injustice would result to him if he should be denied the right to enforce the pretended lien. This necessarily included the obligation on his part to prove that he purchased the lien in reliance on its validity and without any notice of its invalidity.”
We think it pertinent to- state here that Justice Alexander was dealing with 'a factual situation where the mechanic’s lien contract was absolutely void. We think it is also pertinent to point out here, as we did in our original opinion, that the Cockrells permitted the $5500 note to remain in the hands of Willbanks after Mrs. Cockrell knew that such n’ote was padded to the extent of $760. It is true that the $5500 note was delivered by Willbanks to the Cock-rells but on Willbanks’ request the 'Cockrells returned the note to Willbanks and did not later demand the surrender of the note and did not make any investigation to ascertain whether or not the mechanic’s lien contract had been filed with the County Clerk an'd made no effort to protect those dealing with Willbanks without any notice of the invalidity of the mechanic’s lien contract and the note. We think it is also important to state here that the Cockrells kn'ew that the purpose of the padding of the note was ■ to aid them in getting a larger loan on the property. Moreover, the record shows without dispute that on April 11, 1951, the Cockrells paid Willbanks by check the sum of $890 on the construction of the house and at the same time Willbanks gave to the Cockrells a receipt for the payment of $890 on the contract and a receipt for the further amount of $760, which was the difference between the $5500 note- and the contract- price of $4740, which was the amount of the debt and lien the Cockrells intended to create. It is,obvious that when Willbanks gave his receipt for the $890 payment, which receipt further acknowledged payment of the amount of-$760, that the padding of the n'ote was satisfied and for all practical and equitable purposes the fraud perpetrated on Mrs. Cockrell was satisfied. We think it is also important to state here that all the money advanced by the bank on the note and mechanic’s lien was advanced after April'11, 1951, and at the time the bank made its advancements on the note the fraud perpetrated against Mrs. Cockrell no longer existed.
Since the bank had no knowledge or notice of the foregoing transactions, it is our view that the factual situation in this case is clearly within the rule applied by this court in Hill v. Engel, supra, because we think that under this record the doctrine of equitable estoppel was tendered against the Cockrells. “ ‘The purpose of estoppels is to prevent inconsistency and fraud resulting in injustice’. * * * ‘Es-toppel is a doctrine for the prevention of injustice. It is for the protection of those who have been' misled by that which upon its face was fair, and whose character as represented parties to the deception will not, in the interest of justice, be heard to deny.’ ” See Kuehne v. Denson, 148 Tex. 54, 219 S.W.2d 1006, 1009, point 3. See also Dobbins v. Martin-Buick Co., 216 Ark. 861, 227 S.W.2d 620, and cases cited in Texas *891Digest, Vol. ISA, Estoppel. In this connection we think we should say that we have re-examined the bank’s pleading and we think it is sufficient to tender the issue of equitable estoppel. See Scott v. Gardner, 137 Tex. 628, 156 S.W.2d 513, points 1 and 2, 141 A.L.R. 50 (Com.App. op. adopted); Wisdom v. Smith, 146 Tex. 420, 209 S.W.2d 164; Rick v. Gribbs, 147 Tex. 267, 214 S.W.2d 925; Vol. 30, Tex.Dig., Pleading, ^34(6). We likewise think the proof is undisputed on the issue so tendered, and for that reason appellants’ motion for rehearing is overruled. See Points 1 and 2, Hill v. Engel, supra.