Wiener v. Zweib , 105 Tex. 262 ( 1912 )

The principal question in this case, and the only one which it is my purpose to consider, is thus well stated by Mr. Justice Dibrell in his opinion: "Whether a sale made by a trustee, under a power of sale contained in a deed in trust after the death of the grantor, and less than four years after such death, is void, and passes no title." If this question should be answered in the affirmative, it is agreed that the judgment, in the instant case, should be reversed; if, however, a sale so made is valid and passes title to the land sold, then it is clear to my mind that there was no error in the record for which the judgment of the Court of Civil Appeals should be reversed, and defendant in error is entitled to an affirmance.

This particular question has never been ruled on in this State. It is incidentally referred to by Mr. Justice Williams in the case of Taylor v. Williams, 101 Tex. 388, where, in discussing that case, he said: "In referring to the effect of regular administrations upon powers of sale, such as this, we are not, of course, intimating the opinion that the actual opening of an administration is necessary. That question is not before us. If it be conceded that a power of sale cannot be exercised where the estate of the deceased mortgagor is unadministered and where the time in which administration is permitted has not elapsed, the concession does not reach cases like this, where the estate is represented by an independent executor, against whom the creditor is left by the probate law to pursue the remedies applied to his case by general principles and is not confined to any prescribed course, as in the case of regular administrations." However, a critical examination of the facts of that case will show that more than four years had elapsed from the date of the death of W.J. Williams, whose interests were involved in litigation. The record shows that one Smith executed a trust deed in May, 1887, and, on February 1, 1889, conveyed the land to one W.J. Williams. The note secured by the trust deed was due November 1, 1887. On April 2, 1889, the land was sold by the substitute trustee and bought in by one Connery, who held same in trust for Taylor, the beneficiary in the original trust deed. It seems that by an understanding between Taylor and Smith the latter had arranged the sale of the land to one J.H. Bemis, and Connery executed the conveyance to him. In July, 1891, J.H. Bemis conveyed the land to J.M. Bemis. The record further shows that W.J. Williams, the vendee of Smith, died in March, 1894, and that soon thereafter and during the same year W.T. Williams qualified and has since been acting as executor of his will, free from the control of the Probate Court. Smith, as the record shows, died in 1897. Suit was brought (in another proceeding) by Williams' executor against Bemis and Connery and Helen Smith, executrix of J.T. Smith, for the land conveyed by the trust deed on the ground that one Armstead, the original trustee, had not refused to act as such and that the sale by the substitute trustee was void. On that ground Williams recovered the land. See Bemis v. Williams, 7 Texas Crt. Rep., 651. It will be noted that this opinion was delivered on May 6, 1903. So that it is evident that the sale discussed in Taylor v. Williams, supra, was made long after the expiration of four years from the date of the death of J.T. Smith, and very much longer from the date of the death of W.J. Williams. Therefore the only question relating to the matter here involved and decided in the case of Taylor v. Williams was that the suspension of power of sale is not affected by an administration under a will by the independent executor acting without the control of the Probate Court where more than four years had elapsed after the date of the death of the grantor in the trust deed.

In all the other cases cited and discussed by Justice Dibrell it is directly stated that more than four years had elapsed after the death of the grantor in the trust deed and before the sales relied on, except in the case of the National Exchange Bank v. Jackson, 33 S.W. 277. The opinion in that case does not state the facts in any detail, but it is apparent that John J. Aikens, who executed the trust deed under which the sale was made, had been dead considerably more than four years before the sale under power. We gather that he was dead before June 28, 1888, when the land was sold to Jackson, because the record speaks of certain representations made in respect to a mortgage then recorded which was known to exist by Mrs. Aikens and the officers of the association, but not to Jackson. So that we come back to the question which as yet is one res integra in this State — that is, whether a sale made by a trustee under a power of sale contained in a deed in trust after the death of the grantor and less than four years after such death is void, or whether the sale passes title.

In discussing and passing on questions closely akin to this it seems to me that this court has not always clearly distinguished between what is void and what is voidable, and there are expressions in the books, as suggested by Mr. Justice Williams in the case of Taylor v. Williams, supra, and by Mr. Justice Dibrell in this case, which indicate that a sale made under the circumstances existing in this case ought not to be and would not be sustained, but I believe that Mr. Justice Dibrell is quite correct in saying that there is no decision in this State, where the point was distinctly ruled, that holds such a sale was made invalid, and that the point is now before this court for the first time under circumstances demanding a clear and square answer to it.

Now, there are some questions well ruled in this State and about which neither the lawyer nor judge should disagree. It is abundantly established, I think, that a power of sale contained in a trust deed authorizing a conveyance of property on default is a power coupled with an interest and is not revoked by the death of the grantor. It is also well settled in this State that in cases where an administration had been opened in the Probate Court that the power of sale contained in such trust deed is suspended, and this on the ground that its exercise is inconsistent with the orderly proceedings of such courts in the administration of such estate. It is also well settled, I think, that in a case where more than four years have elapsed from the date of the death of the grantor in a trust deed and no administration had been opened on such estate, that, since no administration can thereafter be opened, the power of sale which had theretofore been held in suspense is revived when a sale made thereunder and in conformity with the requirements thereof will and should be sustained. None of these principles, however, as it seems to me, support the sale in this case. Here, confessedly, under the testimony of some of the witnesses, the grantor in the trust deed had been dead but a few months when the sale was made, and more than three years yet remained to run within which an administration could be opened. Undoubtedly the power of sale contained in the trust deed was in a state of suspense. The sale was made under it while in such state of suspense; the purchase made while in a state of suspense; the deed executed while in such state of suspense, and the rights of the parties fixed while in such state of suspense. It must be remembered, too, that it was, in a sense, an involuntary sale, a forced sale, or, as is sometimes said, a sale in invitum. I am inclined to believe, with great deference to the conclusion of my brethren, that the rights of the parties in such case must be judged and determined with reference to the facts existing and the power obtaining and in force when the sale was made. If the rule of my brethren is to obtain we would have the singular anomaly of a grant under a trust deed invalid when made and which no one could assert and maintain in any court for more than three years, yet at the expiration of the full period of four years from the date of the death of the grantor, a sale valid and rights enforceable. This view is further aided, it seems to me, by the fact that many persons besides the grantor in the trust deed and the creditors to be secured by it are interested in the sale of the property and the sums realized therefrom. Any creditor having no lien would undoubtedly be entitled to any surplus remaining after the satisfaction of the mortgage, and the heirs at law would be entitled to recover and receive any surplus after the payment of all debts. Who would bid at a sale made under circumstances under which this one was made, when it might be annulled by the opening of an administration? Such a sale would result in a needless and useless sacrifice of debtor's property. Again, in this case, who would be entitled to possession of the property pending the running of the three years yet to elapse before the right to an administration? Who would be entitled to the rents and profits of such property? To sustain such a rule, it seems to me, ought not to be the rule in this State. Its endorsement is not necessary to the security of the creditor who can, through the orderly processes of the Probate Court, obtain an allowance of his debt and by a sale of the pledged property obtain title thereto or satisfaction thereon. To sustain the sale holds the title to the property in suspense and makes its validity depend, not on the facts as they existed when it was made, but as they may exist by action or inaction of other persons three years after the time the sale had been made. It results that the sale is held in a state of suspended animation and the property in a qualified legal cold storage, until the four years shall elapse, and then it blossoms forth into full blown strength, beauty and effectiveness. Clearly if the power of sale was suspended, the sale had thereunder was likewise suspended.

For these reasons, thus briefly stated, I am unable to agree with my brethren and am therefore very reluctantly compelled to enter my dissent.

Opinion filed December 20, 1911.