Hall v. Layton

| Tex. | Jul 1, 1856

Lead Opinion

Lipscomb, J.

The first question we propose discussing in this case is, whether the settlement between Hall and Buxton Layton, and the receipt of Hall surrendered to him by the said Layton, were procured through the fraudulent representations of Hall ?

2ndly. Assuming the hypothesis, that it was procured by fraud, is there any error in the decision of the Court below in this case?

When this case was before us at a former Term, (10 Tex. R. 55,) we reversed it, on the ground that evidence offered by the defendant in the Court below had been improperly ruled out, and that the question of the fraud of Hall had not been distinctly presented to the jury and found by their verdict. We said “ But we are not satisfied with the evidence of fraud j and “ in the absence of fraud on the part of the defendant, we are “ clear that the plaintiffs were not entitled to a recovery at all.” The case comes before us now without any additional evidence of fraud on the part of Hall, but with the finding of the jury, of fraud, on the question being distinctly presented to their consideration, and with the evidence on the part of the defendant, that had been excluded from them on the former trial.

The jury having, by their verdict, found fraud in Hall, in procuring the settlement and the surrender of the receipt, their verdict is conclusive, if the evidence upon which they found is sufficient to support it. The only evidence is that of Williams, the book keeper of the Laytons, who testifies to a conversation between Hall and Buxton Layton, in 1844. He swears that Hall, when asked by Layton to account for the scrip that had been placed in his hands for location, or for a return of it, stated to him that it was in the hands of a surveyor out west, and he feared that it had been lost, and offered to place scrip to the amount of 3200 acres in the hands of Layton, as security to him for the return of the scrip belonging to Layton & Go., and that he did give that amount of scrip to him, and asked for and received the receipt which he, Hall, had given to Layton & Co. for their scrip.

Now, if this witness is correct, it would fix the fraud upon Hall, in suppressing the fact that it, or a part of it, had been located upon Galveston island, and in falsely saying that it was in the hands of the surveyor out west, and he feared that it would be lost. It is, however, the evidence of a single witness, and he swearing to a conversation between the parties, in which it does not appear that he participated, or that his attention was requested, or in any particular way attracted. Such evidence, though competent, is always received with caution, and subjected to severe scrutiny, because of the great pro-bability of the witness being mistaken in part, or not correctly •understanding, or correctly hearing the conversation; and the difficulty, if not the impossibility, of disproving it. That this is the character of such evidence, we will refer to some of the cases to which our attention has been called by the appellant’s counsel.

In Law v. Merrills (6 Wend. 227,) Walworth, Chancellor, says, “ Evidence to establish a fact, by the confession of a par- “ ty, should always be scrutinized and received with caution, “ as it is the most dangerous evidence that can be admitted in “ a Court of justice, and the most liable to abuse. Although “ a witness is perfectly honest, it is impossible, in most cases, “ for him to give the exact words in which the admission was “ made, and sometimes even the transposition of the words of a J‘ party, may give a meaning entirely different from that which “was intended to be conveyed to the witness.”

In Logan v, McChord’s Heirs, (2 A. K. Marshall.) the Court says, “ Confessions are competent testimony, but frequently “ ought to be received with caution, because they may be par- “ tially remembered, and are more easy to be procured by im11 proper means, and are frequently shielded from disproof.”

In Malin v. Malin, (1 Wend. 652,) Judge Sutherland remarks, “ It has often been said by Judges and by elementary “ writers, that proof of the declarations or confessions of par- “ ties, is the most unsatisfactory species of evidence, on account “ of the facility with which it may be fabricated, and the im- “ possibility of contradicting it. And because the slightest “ mistake or failure of recollection may totally alter the effect “ of the declaration.”

In the case of Tuberville v. The State, (4 Tex. R. 128,) we recognize the danger of this kind of evidence, and .the caution with which it should be received. In the case under consideration, Williams, with the honest intention of swearing to nothing more nor less than the truth, and with no disposition to color or distort the language used, might so easily have been mistaken, from failure of memory or from not hearing all that was said ; and if the conversation was relative to the balance of the scrip, left undisposed of by the arrangement with Jones, if he did not hear the whole of the conversation, it was easy and natural for him to believe that it referred to the original scrip received by Hall from Layton & Co. The circumstances in no particular corroborate the evidence of Williams ; so far from it, they are calculated to weaken and much impair, if not destroy it. The presumption is, that he must have been apprised, at the time of the supposed conversation between Hall and Buxton Layton, of the existence of Hall’s letter, which was proven by him. He does not swear when he first became acquainted with the fact of the existence of the letter ; and having been the book keeper for so long a time, for the firm of Layton & Co., it would be strange if he did not know it; and, knowing it, still more strange, that he did not make it known to Buxton Layton, when he heard Hall make a statement wholly inconsistent with it, when it would have proven the falsity of Hall’s statement. His situation and employment as the book keeper of the firm of Layton & Co., when swearing to the fact of Hall’s verbal declarations resting entirely on his memory, without the means of its being contradicted, does not strengthen, but rather weakens, his credibility ; and in reviewing his evidence, there will be strong grounds to believe that some of the facts sworn to by him, were not from his own personal knowledge, but derived from the Laytons. It is not a reasonable presumption, that Buxton Layton did not know of the location of the scrip on Galveston island, which information had been given to his firm by Hall’s letter; if he did not know of it, he ought to have known it, and it would be productive of much injury, to permit one member of a firm to plead ignorance of a fact, of which the firm had written evidence, and thereby set aside a settlement made by him for his firm. It would disturb and destroy the security of every settlement with a member of a firm, and shake the stability of the rule, that the acts of each member of the firm, so far as relates to the legitimate business of the concern, are binding upon all of the firm. It would be still more unreasonable to suppose that Hall would have the temerity to make a declaration, when he must have known that his own letter furnished proof of its falsity. It is much more rational to believe from the facts, that if Buxton Layton ever did enquire of Hall what had become of the scrip, that it referred to the surplus scrip, after the arrangement had been made with Jones ; and if Hall did say that the scrip was in the hands of a surveyor out west, that he referred to that surplus scrip.

We have seen that the charge of fraud, by which the origin- ’ al trust is sought to be re-established, is supported by but one witness, unsupported by a single corroboratory fact in evidence, and under circumstances that would scarcely have been regarded sufficient to sustain the finding by the jury, of the truth of the charge in any case.

It has been supposed, that the great disproportion in the value of the land located upon, on Galveston island, and the value of the scrip for which the receipt was given to Layton & Co., and given up to Hall by Buxton Layton, raises a strong and conclusive evidence of fraud. A reference to the evidence will show, that there is not the slightest ground to support such an assumption. It shows that in 1844, when the settlement was made between Hall and Buxton Layton, the land located upon by the scrip, and for which Hall and Jones had received the patent, was not regarded as of any value, the general opinion being, that Hall and Jones could not hold the land under their patent, and that the land still belonged to the Republic, and that most persons would have preferred well located land scrip any where else to the title under the patent; and the evidence of the high valuation had reference to the value at the time of the trial.

We believe, however, that the question should be put upon a higher and more certain ground. We cannot, in principle, distinguish this case from the common one where a trust is attempted to be proven by oral evidence of the admission, or declarations of the trust, orally made by the trustee. When placed upon this footing, the case is relieved from all embarrassment or difficulty. The question as to what evidence was sufficient to establish a trust, by the verbal declaration of the maker of the trust, in opposition to the oath of the trustee, was thoroughly investigated by this Court, in the case of Miller v. Thatcher, (9 Tex. R. 484,) and after looking to the authorities, both English and American, we decided, in strict conformity with those cases, that it could not be supported by the evidence of a single witness, unless there were strong corroborating circumstances of what he had sworn. We do not propose to enter again into the investigation of the question, for the purpose of vindicating our opinion. We will only cite the remarks of the Master of the Rolls, Sir William Grant, in the case of Leach v. Leach, 10 Vesey, 517, quoted with approbation by Chancellor Kent in Boyd v. McLane, (1 John. Chan. 590.) “ How is the fact made out ? There is no material ev- “ idence but that of the trustee, who is made a competent wit- “ ness by a release. She swears to no fact or circumstance “ capable of being investigated or contradicted ; but merely to “ a naked declaration supposed to be made by the husband “ himself, admitting that the purchase had been made with the “ trust money. That is, in all cases, most unsatisfactory evi- “ dence, on account of the facility with which it may be fabri- “ cated, and the impossibility of contradicting it. Besides, the “ slightest mistake or failure of recollection may fatally alter “ the effect of the declaration." We believe, therefore, that the Court erred in refusing to grant the motion to set aside the verdict and grant a new trial.

If the evidence had been sufficient to support the finding of the jury, we would have reversed the decree, because we believe that if Layton & Co. could have recovered any land on the locations upon Galveston island, they could not in equity have been entitled to more than a pro rata of what Hall received, himself, on the compromises shown in evidence. Equity will not tolerate the throwing the whole loss upon Hall. The judgment and decree is reversed and remanded.

Reversed and remanded.

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Dissenting Opinion

Wheeler, J.,

dissenting. When this case was before us on a former appeal, I did not concur in its disposition ; and intended to have expressed my view of the case in a written opinion, but the claims of other causes prevented. I then thought, as I now think, that the opinion and judgment proceeded in a misapprehension of the issues really presented by the pleadings, [and an erroneous application of the law to the case. I have as little doubt that the present judgment is founded in like error of law and fact. The only material averment of the petition, denied by the answer, is, as to the false and fraudulent representations, by means of which the defendant procured the delivery up by the plaintiffs, of his receipt, and, as he says, a final settlement, by which he was released from the obligation of his original contract. This was the only question, at all material, upon which the parties were at issue by their pleadings, and on which they went to trial. All the other material averments of the petition were admitted expressly, or were not denied by the answer. The original contract was admitted ; so was the delivery up to the defendant of his receipt for the scrip originally received ; but that it was procured by fraudulent representations, was denied. The answer states, or rather insinuates, that the settlement was procured by the defendant representing that he had not been able to make the scrip available, by his location upon the island, for its nominal amount, and that the location was involved in doubt and litigation. It turns out, that this Representation, as to any pretended litigation existing at the time, was not true in fact. The litigation with Jones about the location, was amicably settled before the patent issued in 1840. The suit for partition between Hall and Jones was amicable; at leash it should have been so ; and nothing appears to the contrary. It cannot be pretended that the defendant can justify or palliate- the making of such a representation in 1844, by the proof of litigation which did not occur until years after. The evidence proposed upon the former trial, and admitted on the last, to prove the fact- of such litigation, was rightly excluded by the Court on the former trial, and ought to have been so held by this Court, for the plain reason that no foundation was laid for its admission in the answer ; it was objected to as irrelevant, and for that cause was rightly excluded. The defendant insisted upon the finality of the settlement with the Laytons ; denying that it had been procured by fraud. This was the only issue he tendered: upon this alone he rested his defence, and upon it the case was tried. Evidence, which in no way conduced to support the defence, or the issue on his part, was certainly inadmissible. If it had been proposed to prove litigation existing at the time of his alleged settlement with the Laytons, as a justification of the representations he pretends to have made to them ; or to prove that he had not been able to render the scrip available for its nominal amount of acres ; or that he had been compelled to incur extraordinary expense and trouble to secure the location, and was therefore entitled to a larger proportion of the land than he would have been entitled to by the original contract, under appropriate issues, the evidence would have been admissible for such purpose. But such were not the issues; nor was the evidence proposed for any such purpose. It was merely irrelevant, and did not in any way affect the final result. Its admission or rejection, therefore, is of no importance, only that it was made a ground for reversing the judgment, as I think, without reason.

The real objections to the judgment on the former appeal, were, that it decreed a conveyance with warranty, which the law of the case did not authorize ; and the verdict found the value of the land, which was made the basis of a judgment in the alternative for so ipuch money, for which there was no foundation laid by averment in the petition. For these errors the judgment should have been reformed, or reversed, and the proper judgment rendered. But there was no occasion to reverse and remand the cause for a new trial. So much of the finding of the jury as was not within the issues, was mere surplusage, and did not vitiate the finding upon the only material issue in the case, that of fraud in fact. It is true the jury did not find fraud in express terms; but according to the uniform course of decisions and practice in this Court, the general verdict for the plaintiff included that finding. That was the main and only material issue submitted to the jury ; and their finding was doubtless intended to embrace, and should have been held to embrace it.

I have thus adverted to the questions presented by the record on the former appeal, for the purpose of more readily indicating the grounds of my dissent from the present judgment.

The judgment ought, perhaps, to be reformed, if the pleadings and the attitude which the defendant has assumed upon the record, will admit of it, so as to render the decree more favorable to him. That question, however, as it has become unnecessary, I do not propose to examine; or to inquire how far a Court of equity will go to accord equity to a party who has not asked it, and persists in refusing to do equity to others.

The principal and material issue upon the last, as upon the former trial, was, whether the settlement with Buxton Layton in 1844, was obtained by fraud ; and the question is whether the evidence was sufficient to warrant the finding of the jury upon that issue. I do not doubt that it was. The question was one of fraud in fact. It was a question which it was peculiarly within the province of the jury to decide. They were the exclusive judges of the credibility of the witnesses and the weight of evidence. The law, it has been well observed by Mr. Starkie, has no scales wherein to weigh the different degrees of probability ; still less to ascertain what weight of evidence shall amount to proof of any disputed fact. Its business is to define, to distinguish and to apply legal consequences to ascertained facts; but whether a fact be probable or improbable, true or false, admits of no legal definition. The law, therefore, refers the weight of evidence, and the degree of probability to the decision of the jury, who are to be guided by their conscientious judgment and belief, upon all the circumstances of the case. To deny their sole and exclusive right to decide upon the weight of evidence, and determine the issue, where the question is one purely of fact, like the present, would be an invasion of the right of trial by jury, plainly violative of the Constitution and law. The Court is not allowed to charge the jury upon the weight of evidence ; nor can it be pretended, that this Court has any more authority than the District Court, to control their finding upon such a question. Accordingly it has been the uniform language of Courts, that where the question is one of fact, the Court will never interpose to disturb the verdict of the jury, if there is evidence which conduces in any degree to its support. The testimony of the witness Williams fully supports the verdict. It is unimpeached. There not only is nothing in the other evidence in the case to cast doubt or suspicion upon the verity of his statements; but on the contrary, they are corroborated, in the main, by other evidence and by the answer of the defendant himself. It is wholly immaterial whether, as he says, the scrip was delivered as security for the return of the original scrip, or whether, as the defendant insists, it was delivered upon final settlement. In either case, if the settlement was procured by the fraudulent representations of the defendant, it was void, and did not relieve him from the obligation, of the original contract. It appears from the testimony of Ayres, and of Franklin, and from the defendant’s answer, that the statements of the witness are, in the main, true. There is no cause to discredit their truth in any particular.

But if we put aside the testimony of the witness altogether, and look to the answer of the defendant, and the uncontroverted facts of the case, it seems equally difficult to resist the conviction that the Laytons were cheated and defrauded. If they had not been deceived and imposed upon by Hall, they would never have delivered up his scrip and released him upon such terms. If they had known that their scrip was located on Galveston island; that the defendant had obtained from the government a patent for the land; that he esteemed it very-valuable, and that his legal adviser had confidence in the title ; is it to be believed that they would have surrendered up their entire interest in the land for the amount receh ed of unlocated land scrip, worth at the time a few cents per acre ? The suits which ultimately destroyed confidence in the title, were not instituted, nor were they directed by Act of the Legislature to be instituted, until long after this, and after the change of government by Annexation. Hall’s efforts to secure the location upon the island, his letter to the Laytons in 1830, and the testimony of Franklin, show very satisfactorily the estimate he placed upon these lands at the time. Had he communicated the facts of the case as he understood them, to Buxton Layton in 1844,1 apprehend, there would have been no occasion for this suit.

If there were no positive evidence of fraud, it is sufficiently apparent from the very nature of the transaction and the circumstances of the case. Fraud need not, and indeed it very seldom can be, proved by direct and positive evidence. It may be apparent (says Judge Story) from the intrinsic nature and subject of the bargain itself; such (in the language of another eminent Judge) as no man in his senses and not under a delusion would make, on the one hand; and no honest and fair man would accept, on the other. Such, it seems impossible to doubt, was the bargain or settlement between Buxton Layton and the defendant in 1844.

If it be supposed that the former should have been put upon his guard against the imposition practiced upon him by the defendant’s letter of 1839, respecting the location of the scrip, the answer is, that it was not known to him. The correspondence relating to the scrip had been with another member of the firm, who was then absent from the country, and who, upon his return and discovery of the fraud practiced upon him, seems to have lost no time in asserting his rights. Besides, if the contents of that letter was really known to Buxton Layton at the time it was received, it can not be thought strange that it should have escaped his memory after so long a time ; and I do not perceive that it is any extenuation of the defendant’s conduct, that, by reason of the plaintiff’s forgetfulness or oversight, he was enabled to overreach him in the transaction of 1844. In fine, without commenting upon the facts of the case, which I have no desire to discuss ; or adverting to arguments, by which the true character of the transaction may be kept out of view or disguised, and the decision of the fact wrested from the jury, to whom it properly belongs, it will suffice to say that, upon a due consideration of all the facts and circumstances of the case, it seems impossible to resist the conviction that the plaintiffs were overreached, cheated, and defrauded, in the transaction with one of their firm in 1844.

The doctrine as to what will be sufficient evidence to establish a trust, manifestly has no application to the case. It was not questioned that the defendant was the agent of the plaintiffs in the location of their land scrip, and in procuring the title. There was no dispute about the facts that constituted him their agent and trustee—holding the title, when obtained, in trust for them. The proof upon this subject, though ample, was unnecessary ; for the facts which constituted the defendant a trustee were fully admitted by the answer. There was and could be no question upon that subject. The question was whether the discharge of the trust had been procured by fraud? That being established, in the language of the Opinion, when the case was before us on the former appeal, “ would restore the obligation of the first contract,” (10 Tex. R. 59,) or, to speak more accurately, it would leave the obligation of the contract in full force, unimpaired by the fraudulent transaction. It would remove the cloud thereby cast upon the plaintiffs7 title. The question of fraud in procuring the settlement was to be determined by the jury, upon the facts and circumstances of the case in evidence before them, just as any other issue of fraud in fact is left to the decision of a jury. The issue being found for the plaintiffs, the legal consequence is, that their rights remain the same as they were before that settlement— unimpaired and unaffected by it. Having been induced by the fraud of the defendant, it was void and without effect upon the pre-existing rights of the parties. This is quite too clear for doubt or controversy. It is indisputable that the rights of the plaintiffs, under the contract, could not be defeated by a cancellation of it, obtained by fraud. It was only necessary to establish, that the cancellation, or settlement, of whatever nature, was so obtained ; and that the plaintiffs have done by the verdict of two juries, upon evidence as satisfactory as ordinarily has been, or can be obtained upon such a question. My opinion, therefore, is that the verdict was well warranted by the evidence, and that the plaintiffs ought to have judgment upon the verdict.

I have thus particularly noticed the state of the record and the question it presents, because it seemed necessary to an understanding of the grounds of my dissent from the Opinion and judgment of the Court. But the law of the case, arising upon the record, so far as concerns the question whether plaintiffs should have judgment upon the verdict, may be shortly stated thus : The question for the jury was one of fraud in fact, which it is peculiarly their province to decide. There was positive evidence of the fraud. The jury were the exclusive judges of the credibility of the witness and the weight to which his testimony was entitled. Having passed upon these questions and decided the issue, their verdict ought not to be disturbed, and cannot be set aside, without a plain departure from the well established rule of law upon this subject, maintained by the oft-repeated decisions of this Court.