Corbett v. Allman , 111 Tex. 543 ( 1922 )

Mr. Justice PIERSON

delivered the opinion of the court.

In 1901, plaintiff in error, Corbett, and defendant in error, All-man, entered into an executory contract by which plaintiff in error contracted to convey to defendant in error the tract of land in controversy. Plaintiff in error agreed to clear the title to the land as against some claimants in McLennan County in a suit pending in that county, and then to execute a warranty deed to defendant in error. This he neglected and failed to do. Defendant in error agreed to pay $300.00 for the land and the back taxes. He paid the taxes and $29.80, entered upon possession, made valuable improvements, and under the contract agreed to execute his notes for the balance of the purchase money when plaintiff in error had cleared the title as to the McLennan County claimants and executed his warranty deed to him.

In 1914 defendant in error brought this suit against plaintiff in error in trespass to try title, set up the contract, but alleged the statute of limitation of ten years against plaintiff in error’s title and the statute of limitation of four years against the notes the contract called for to be executed by him. He also alleged improvements in good faith, and prayed that if he were not awarded the land he be permitted to recover for his improvements. He alleged that in 1912 he had offered the balance of the purchase money upon the execution of the deed, but that plaintiff in error did not execute the deed. He made no tender of the balance of the purchase money. However, he closed his prayer as follows:

“The plaintiff pays that he be quieted in his title and possession of the land and tenements, sued for by the plaintiff, but in the event that this relief can not be granted, under the facts, then that' the court grant such equitable relief as the plaintiff may be entitled to receive, under all the facts, and that whatever rights the plaintiff may have be protected, and that the same be not jeopardized by a forced sale, and for general and special relief.”

Plaintiff in error defended, alleging the contract and that defendant in error’s possession was by virtue thereof, and that his possession was not adverse; that defendant in error by alleging limitation had repudiated the contract, and on account thereof had deprived himself of his equitable right to claim the benefits of his improvements. He prayed for rescission of the contract, to recover back the land, and that defendant in error be denied any recovery for improvements. He did not allege that he had cleared the title as to the McLennan County claimants, nor that he had tendered the deed provided in the contract. He alleged that he had at all times been willing to make deed and to receive the balance of the purchase money, but in his pleading and on the trial he did not offer to do so.

The trial court entered judgment decreeing the land to plaintiff in error upon rescission, but found for defendant in error for improvements in the sum of $1620.00.

Prom this judgment plaintiff in error appealed, urging that defendant in error, because of his plea of limitation as to plaintiff in error’s title and as to the notes to be executed by him when plaintiff in error had cleared the title and executed to him a deed, had repudiated the contract and in equity could not recover for improvements in good faith.

The Court of Civil Appeals tried to adjust the equities between them, in view of the fact that neither of them had placed himself in position to demand equity, in that plaintiff in error had failed to keep his contract as to clearing the title and in not executing his deed, and defendant in error in pleading -limitation against plaintiff in error in bar of his obligation to pay the balance of the purchase money under the contract.

It affirmed the judgment decreeing the land to plaintiff in error under rescission, denied to defendant in error improvements in good faith, but decreed that a stay of judgment be granted so that if on or before November 1, 1916, defendant in error should pay, or cause to be paid, to plaintiff in error the balance of the purchase money with interest from May 1, 1901, as provided in the contract, with costs of suit, then the title to the land should be vested in him, defendant in error.

Prom this judgment plaintiff in error sued out writ of error to this Court, and same was granted May 23, 1917.

On January 29, 1918, an agreed motion was filed in this Court to dismiss the cause, same being signed by the attorneys for both parties litigant, and on January 30, 1918, an order was entered dismissing the cause.

A few months later plaintiff in error filed his motion to reinstate the ease, alleging that his attorney had no authority to settle the case and to dismiss it; that by so doing he had sacrificed plaintiff in error’s rights to his great injury.

It appears that the relationship between plaintiff in error and his attorney in regard to the collection of the balance of the purchase money from defendant in error, and in defending the suit, existed for a number of years — from early in 1912 to 1918 — and that all their communications were by correspondence. Therefore, their letters disclose all that was said and done as to the attorney’s authority to accept the unpaid purchase money and to settle the case.

An examination of the letters discloses that plaintiff in error was very negligent in attending to the matters, not only in having neglected to clear the title and not making deed to defendant in error from 1901 to 1914, but also in the matter of answering his attorney’s letters and assisting him in the prosecution of or the defending of the suit. The negotiations between them were begun in 1912 (before defendant in error brought suit in 1914), in which plaintiff in error sought to employ the attorney to collect the balance of the purchase money. However, an agreement was reached in 1914, after the suit was filed. The attorney agreed to “undertake to collect the purchase money,” and was to receive as compensation for his services 25% or one-fourth of the recovery, either in money or land.

On May 20, 1914, plaintiff in error, through a firm of attorneys at Houston, and with his approval, instructed his attorney that he could use his own judgment as to the matters of collecting the unpaid purchase price or of recovering the land.

After the trial of the case in the District Court with the result as stated above, plaintiff in error, on July 16, 1915, wrote his attorney as follows:

“Of course I do not want to buy these farms and I think you are right to appeal the cases.

“If you could reform the judgment by agreement and value the land something like $20 per acre and then give them the option to buy in a certain time and failure to buy would revert all to us. I had a judgment of this kind once.”

On June 27, 1916, after decision by the Court of Civil Appeals, plaintiff in error in unambiguous language gave his attorney authority to do exactly what he did do when the suit was dismissed, except that he offered to give Allman terms, whereas cash was paid. His letter is as follows:

“Allman may be a good man but he had a mighty poor way of showing it in trying to beat me out of the land. Your views about the law are correcct. The court exceeded its authority and I want the case to go up. But if Allman will pay me the face value of the contract, interest calculated yearly and will pay all'costs and wall satisfy you outside, then we will settle with him, otherwise go on up with it. He has had the use of this land for 15 years and I should have a yearly rent in shape of annual interest compounded.”

This was the last letter written by plaintiff in error to his attorney before the tender of the balance of the purchase money by Allman and all amounts demanded, in accordance with the terms of said last letter, the acceptance thereof by the attorney, and the dismissal of the case in this Court on January 30,1918.

On November 6, 1917, the attorney wrote plaintiff in error that Allman desired to know what plaintiff in error would take to settle his case, referred to a $400.00 deposit Allman had theretofore made in the Court of Civil Appeals, and informed plaintiff in error that there was an oil boom on there. Plaintiff in error received this letter, but made no reply to is; thus leaving his former instructions to his attorney undisturbed and in full force and effect.

It is urged by plaintiff in error that the lack of authority of his attorney to dismiss his petition for writ of error in this Court is fully shown, proven and demonstrated by the sacrifice of plaintiff in error’s rights and property by said disposition of the case; that his injury and loss of rights and property are great and irretrievable unless the motion to reinstate is granted and the Court pass upon the merits of the ease.

In all the correspondence from Corbett after judgment in the District Court he contends that that judgment was wrong; that he should not be held for improvements in good faith, and that he did not want to buy this land.

Before he could deny defendant in error the right to recover for his improvements made upon the land under his contract of purchase, even though defendant in error did attempt to repudiate said, contract by pleading limitation against its terms, he, plaintiff in error, must show that he himself did equity and was entitled to demand and he accorded equity. Under his contract with defendant in error the duty first devolved upon him to do that stipulated therein that he should do, to-wit: to clear the title as to the McLennan County parties and to make deed to defendant in error. Neither in his pleadings nor in the trial did he offer any excuse for not having performed his contract, nor did he offer to execute the deed or to put himself in position to demand and receive the benefits of his contract. He not having done equity nor come into court “with clean hands,” he was not in position to take advantage of the inequitable stand taken by defendant in error.

This being the state of facts as to lack of equity on both sides, defendant in error had the right to waive plaintiff in error’s default in not clearing the title as to the McLennan County parties, to tender the balance of the purchase money and demand a deed; or he had the right to a rescission of the contract, to release the land to plaintiff in error, and to pray for a return of purchase money paid, with interest, and for his improvements. However, he did not do this. Rather, he chose to repudiate the • contract, tried to hold the land under limitation and yet claim the benefits of the improvements in good faith under the contract. This was inconsistent and inequitable. Thus both plaintiff in error and defendant in error in the trial court failed to offer to do equity. This failure to do equity and to offer to do equity remained inherent in the case on appeal, and at once became the question of difficulty before the Court of Civil Appeals.

Now, referring back to the proposition that the dismissal of plaintiff in error’s appeal in this Court by his attorney of record was an abuse of his rights in the case, to his irreparable injury, and to defendant in error’s answer that said attorney secured for him all that he probably could have recovered upon another trial of the case, the consideration promptly suggests itself, what would be the rights of the parties upon a new trial ?

Well, the parties would still find themselves where they were at the beginning. Plaintiff in error would have the right and opportunity to tender performance by showing that he had removed the cloud from the title, and to tender a deed and demand the purchase money, and, in default thereof by defendant in error, to rescind the contract and recover back the land unencumbered by any claim of defendant in error. If he was unable to show the removal of the cloud to the title as to the McLennan County parties, but was able to show diligence in regard thereto, and also to show that the contract was impossible of performance in that regard, and that the contract could not be performed, he then would have had the right, in the absence of an acceptance of the land by defendant in error without the cloud removed, to his cause of action to annul the contract and to place both parties back in statu quo. That is, in order to cancel the contract and receive the land back, he would have to tender to defendant in error the purchase money paid, with interest, and the value of the improvements placed upon the land, less the value of the use of the land during the period.

On the other hand, upon such a showing by plaintiff in error, defendant in error would have the right to accept an annulment of the contract and to receive back his money paid and the benefits of his improvements, or he would have also had the right to accept the title to the land from plaintiff in error as it was, to pay the balance of the purchase price, and to demand and to receive a deed from plaintiff in error.

Until plaintiff in error complied with his contract with reference to the title, and at least until he had tendered his deed to defendant in error, he could not demand of defendant in error the balance of the purchase money; neither could he rescind and demand the return of the land without reimbursing defendant in error for his improvements.

This, however, is what he was attempting to do, both, in the trial court and on appeal. His contention all the way was that he did not want to accept the land encumbered with the charge for improvements, but wanted the balance of purchase money or the land not so charged. Then, whether or not, under the pleadings and facts, an appellate court should affirm the judgment of the trial court (to which he was protesting), or otherwise reform and adjust the equities between the parties, it could not be asserted that upon his adversary’s doing that which equity required of him, his attorney, in dismissing his appeal under the authority in him under the facts of this case, had acted in bad faith and in utter disregard of his. interests.

Therefore, from the foregoing it will be seen that when plaintiff in error’s attorney received from defendant in error all the balance of the purchase money and payment in full of all demands under the contract, he did no more than plaintiff in error would be compelled to accept upon another trial of the case. However, as stated before, we think express authority was given, and this express authority so given was not weakened, but strengthened and emphasized, by all the correspondence between them and the facts attendant upon the development and progress of this litigation and the nature and equities of the case. The authority of the attorney to act as he did in the disposition of the ease having been expressly given, the plaintiff in error could not be prejudiced thereby.

In this connection, it is called to our attention that the attorney’s fee was a contingent one-fourth interest in whatever was recovered in money or land. There is no charge or intimation that the attorney received anything other than his one-fourth of the proceeds under the contract, or that there was any improper motive on his part. Therefore, if he sacrificed his client’s interests, he likewise sacrificed his own, his acts upon their face bearing the indicia of good faith.

Settlements and adjustments between parties litigant are not discouraged by the courts, but are encouraged. In a case like this, where the authority for an attorney to settle a case, with the terms thereof, is expressly given, and where these terms have been fully complied with by the attorney, and the settlement is free from fraud or bad faith, the court will not lightly set it aside.

The motion to reinstate the cause is overruled.