Cruz G. BARRERA еt al., Appellants, v. F. C. GONZALEZ, Appellee.
No. 13670.
Court of Civil Appeals of Texas. San Antonio.
Dec. 21, 1960.
Rehearing Denied Jan. 11, 1961.
341 S.W.2d 703
POPE, Justice.
Trial was to a jury. After plaintiff had rested, defendant moved for an instructed verdict, which was granted by the Trial Court, and judgment rendered for defendant that plaintiff take nothing.
Plaintiff appeals, contending that the Trial Court erred in directing a verdict for defendant because there was sufficient evidence to raise issues of fact as to the validity of the Mechanic‘s and Materialman‘s Lien Contract, Note and Deed of Trust, the 2 Trustee‘s deeds and the Quitclaim deed.
Plaintiff contends that the Mechanic‘s and Materialman‘s Contract was not executed by all before a Notary Public. The instrument is in evidence and reflects that it was executed before a Notary. Execution before a Notary, however, was not required, since plaintiff was a single woman. The fact that she did not acknowledge the mechanic‘s lien before a Nоtary does not affect the validity of the mechanic‘s lien against her homestead.
The record reflects that the Trustee‘s deed was made by a substitute Trustee; that the Trustee named in the deed of trust had resigned; that such resignation was of record in the Mortgage Records of Harris Cоunty, Texas and that the appointment of the substitute Trustee was likewise of record in the Harris County Clerk‘s office. We perceive no error here.
The record further reflects that plaintiff was in default on her payments under the Mechanic‘s Lien Contract and that she has not tendered either the necessary payments to bring the note up to date, nor has she tendered the plumbing fixtures received as consideration for the Mechanic‘s Lien Contract and Note.
The Mechanic‘s Lien Contract, Notes, and Deed of Trust were executed on April 22, 1952. This suit was instituted on March 21, 1957. The four year statute of limitations (
There is no evidence that the quitclaim deed was obtained by fraud.
From the foregoing, it is our view that the instructed verdict of the Trial Court that plaintiff take nothing is correct.
The judgment appealed from is affirmed.
Pope & Pope, A. J. Vale, Rio Grande City, for appellee.
POPE, Justice.
Whether a deed, absolute on its face, is in fact a mortgage is the subject of this appeal. F. C. Gonzalez, the grantee, sued Cruz Barrera, a widow, and her two minor children as heirs of his grаntor, in trespass to try title. He recovered title to two city lots in Roma, Texas, in a trial before the court. Defendants urge that (1) the case should be rendered, since all the evidence shows that the deed from Barrera to Gonzalez was intended as a mortgage, or that (2) the case should be remanded because the judgment is against the great weight of the evidence, and (3) the court erred in excluding certain evidence.
The legal principle involved is settled. A deed absolute on its face may be construed as a mortgage if the evidence, inсluding parol evidence, shows that such was the intention of the parties. Wilbanks v. Wilbanks, Tex., 330 S.W.2d 607; Bradshaw v. McDonald, 147 Tex. 455, 216 S.W.2d 972; Kokernot v. Gilstrap, 143 Tex. 595, 187 S.W.2d 368; Parmenter v. Kellis, Tex.Civ.App., 153 S.W.2d 965. “The criterion is the continued existence of a debt or liability between the parties, so that the conveyance is in reality intended as a security for the debt or indemnity against the liability.” 3 Pomeroy‘s Equity Jurisprudence, 4th Ed., § 1185; Parmenter v. Kellis, supra.
We overrule defendants’ contention that all the evidence proves that the deed was intended as a mortgage. Gonzalez, the plaintiff grantee, introduced in evidence a general warranty deed dated November 26, 1957, from Guadalupe Barrera and wife. He explаined that the continued possession of the property by the Barrera family was under a lease which he also introduced. It was signed only by Gonzalez and provided that Barrera could remain in possession until July 25, 1958, rent free. He testified that grantor owed him money and that the debt was dischаrged by delivery of the deed. This evidence for Gonzalez defeats the contention of no evidence.
However, we sustain the point that the judgment is against the great weight of the evidence. Gonzalez and Barrera were friends, and Gonzalez advanced funds to Barrera neеded in the operation of a garage and filling station located on the lots in question. On April 29, 1957, Barrera gave Gonzalez his note for $1,030 payable in one
The deed from Barrera and wife to Gonzalez recited that as a part of the consideration, Gonzalez, the grantee, assumed the balance of an indebtedness the Barreras owed a lumber company, which was evidenced by a recorded lien and deed of trust on the property. However, after Barrera‘s death, his credit life insurance was used to discharge that debt, which amounted to more than $2,000. This is not disputed. Gonzalez knew about and permitted this discharge of a debt he says he assumed. Hence we find that Gonzalez testified that the deed discharged the debt, yet, in the face of the recitals in the deed, it was Barrera‘s life insurance which was used to discharge a debt which Gonzalez had assumed. We regard this as highly significant evidence that Gonzalez was still looking to and expeсting Barrera to pay debts though the deed purported to discharge them. We regard the judgment as against the great weight of the evidence. In re King‘s Estate, 150 Tex. 662, 244 S.W.2d 660.
Because the case must be remanded, we shall pass upon several matters of evidence which were excluded by the trial court. Defendants offered in evidence a suicide note,1 an entry made in a book found in Barrera‘s bed room, and some notations on the back of an envelope. The substance of these notations is the same in each document. Each document was offered as еxceptions to the hearsay rule, and specifically as admissions against Barrera‘s interest. The declaration which defendants claim is against their interest is the recitation that the declarant was indebted to Gonzalez in the sum of $2,919.24. The basis for this exception to the hearsay rule is the circumstantial probability that declarations against one‘s pecuniary interest are usually trustworthy. This is so because people are reluctant to speak falsely to their own detriment and ordinarily do not do so unless they speak the truth. To fall within the exceptiоn at all, there must be a statement which is against interest. 2 McCormick & Ray, Texas Law of Evidence, § 104. We regard the statements offered in this case as self-serving rather than disserving. The issue involved is not whether Barrera owed money. If that were the issue, the offered statements would be against intеrest. Instead, the statements are offered to prove that he did owe money and for that reason, he still owned the property. Unless the debt continued, title to the property was lost. The declarant served his own interest in making statements by which he would retain or recover the title to property he had deeded away. Statements which tend to prove the fact of debt serve his interest instead of defeating his interest. We do not reach the contention briefed by defendants, that any disserving statement will admit all, even the self-serving statements contained in the same document. In this case, even the statement that declarant owed $2,919.242 is self-serving to one who wishes to prove that he owes a debt secured by the property. The documents were properly excluded.
The judgment of the trial court is reversed and the cause remanded.
MURRAY, Chief Justice (dissenting).
I do not agree with the holding of the majority that the implied finding of the trial court to the effect that the warranty deed in evidence was what it purported to be on its face, an absolute conveyance of the land in controversy, was against the great weight of the evidence, and that for this reason the judgment must be reversed and the cause remanded.
The appellants undertook to prove that the deed, regulаr on its face, signed, acknowledged and recorded, was not what it purported to be, but was only a mortgage on the business homestead of Guadalupe E. Barrera and his wife, Cruz G. Barrera. The deed was executed by the Barreras on November 26, 1957. On January 10, 1958, Barrera committed suicide. Three days after the date of the deed, F. C. Gonzalez executed a lease and had it recorded, allowing the Barreras to remain in possession of the land, rent free, until July 26, 1958. This suit was instituted on May 16, 1959, in the form of trespass to try title. The appellants answered setting up, among other things, that the deed regular on its face was intended by the parties as a mere mortgage. Guadalupe E. Barrera was, of course, dead at the time of the trial, and appellants undertook to prove that the deed was merely a mortgage by circumstantial evidence.
Where a party undertakes to prove that a deed to land, while regular in every respect on its face, was in truth and in fact merely a mortgage, he must do so by evidence which is clear, unequivocal and convincing, because otherwise the natural presumption that it is what it рurports to be will prevail. Griswold v. Citizens Nat. Bank in Waxahachie, Tex.Civ.App., 285 S.W.2d 791.
The consideration recited in the deed was $10 cash “and other valuable considerations,” and the assumption by Gonzalez of the balance of the indebtedness owing by the Barreras to G. & G. Lumber & Hardware Company. There was no mention in the deed of the $1,030 nоte, or the 14,560 Pesos note. Concerning these notes Gonzalez testified as follows:
“Q. Now, these (referring to the above two notes) are still owing to you, are they not? A. Well, not owing to me now, because he has already paid by this deed, warranty deed.
“Q. In fact, you would like to collеct all or something on these debts,
would you not? A. Well, not-not collect them any more, because they are already paid by this warranty deed.”
It is true that two of Barrera‘s brothers testified that about three days after Guadalupe committed suicide, Gonzalez sent for them and told thеm that Guadalupe owed him some money on some notes, and if he could have back the amount of the notes he would return the deed to the property. Gonzalez denied that he made such a statement and the trial court gave weight to his testimony.
With reference to insuranсe money being used to pay off the G. & G. Lumber & Hardware Company note, the evidence is not very clear. It seems that G. & G. did some work on the filling station involved and took Guadalupe Barrera‘s note in the sum of four or five thousand dollars. This note was sold to the bank at Roma. The bank held insuranсe to secure the payment of the note in case of the death of Barrera before the note was fully paid. When Barrera died the insurance company paid the bank the balance due on the note. This sheds very light light on whether or not the deed was what it purportеd to be, or was merely a mortgage on the homestead.
I cannot agree that the trial court‘s implied finding that the instrument was what it purported to be, a warranty deed, was “against the great weight of the evidence.” The burden of proof was upon appellants to show by the еvidence that the deed, while regular on its face, was in fact a mortgage on the Barrera homestead.
It was the duty of the trial court who heard the witnesses testify and observed their conduct on the witness stand to, pass upon the weight and credibility of their testimony, and we are bound by his imрlied finding to the effect that appellants failed to prove by clear, unequivocal and convincing evidence that the deed was intended by the parties only as a mortgage. McDonald, Texas Civil Practice, Vol. 4, p. 1301, § 16.10; Clifton v. Koontz, Tex., 325 S.W.2d 684; Banks v. Collins, 152 Tex. 265, 257 S.W.2d 97; Benoit v. Wilson, 150 Tex. 273, 239 S.W.2d 792; Woodward v. Ortiz, 150 Tex. 75, 237 S.W.2d 286; Cavanaugh v. Davis, 149 Tex. 573, 235 S.W.2d 972.
I respectfully dissent.