author: WALTER, Justice.

text:
    Edith Bradford TOWSON et al., Appellants, v. TEXAS ELECTRIC SERVICE COMPANY, Appellee.
    No. 3827.
    Court of Civil Appeals of Texas. Eastland.
    Oct. 4, 1963.
    Rehearing Denied Nov. 1,1963.
    Nunn, Griggs & Beall, Charles Griggs, Sweetwater, Dell & Perry Barber, Colorado City, for appellants.
    Mays, Leonard, Moore & Dickson, George Leonard, Jr., Sweetwater, for ap-pellee.
   WALTER, Justice.

Texas Electric Service Company filed condemnation proceedings complaining of Edith Bradford Towson, individually and as independent co-executrix, joined pro forma by her husband, W. E. Towson; Giles Edward Bradford, Jr. and George Willis Bradford, individually and as independent co-executors of the will and estate of Hattie Maude Bradford, deceased, and as co-trustees of said will and estate. These defendants and the capacities in which they are sued is taken from the “Statement for Condemnation.” Appellants have the following to say about service on these defendants : “Service was had on them as such and some time during the proceedings, the wording 'and as Co-Trustees of such Estate’, was written in the papers, and such wording was typed in some of the later papers and in the judgment, but the citation served on each of the defendants did not contain such wording.” The citations that were served on the defendants do not show that they were sued in their capacity as “Co-Trustees of such Estate.”

On appeal from the Commissioners’ award, the representatives of the deceased, as individuals, as independent executors and as “Co-Trustees” recovered judgment against the appellee for $1,400.00 and the appellee recovered an easement and right of way across their land. The representatives of the deceased filed a motion for a new trial which was overruled. They gave notice of appeal, but none was perfected.

In the trial of the case on its merits the parties entered into a stipulation. The representatives of the deceased, individually, as independent Co-executrix and Co-executors and as Co-trustees, through their attorney of record signed this stipulation. It recited that they owned 1235 acres of land and that the Texas Electric Service Company had acquired an easement on 14.35 acres of the land and that they had been unable to agree on the damages.

Rule 124 of Texas Rules of Civil Procedure provides that no judgment shall be entered against any defendant unless upon service, or acceptance or waiver of process or upon an appearance by the defendant. Rule 7 provides that any party may appear and prosecute and defend his rights either in person or by attorney. It is true that the citation served on the representatives of the deceased did not recite the fact that they were being sued as Co-trustees. However, they voluntarily appeared in that capacity and prosecuted their claim for damages, recovered a judgment in that capacity, filed a motion for new trial and gave notice of appeal in that capacity. As Co-trustees they have not appealed from such judgment. We are compelled to hold under Rules 124 and 7 that the parties, thereby, made an appearance through their attorney of record as “Co-trustees”.

Doris Starnes joined pro forma by her husband, B. Pete Starnes; Louise Bradford Boggess joined pro forma by her husband, William F. Boggess; Lillian Bradford God-frey joined pro forma by her husband, Ross R. Godfrey; Jack C. Bradford; and Margaret Jean Guess joined pro forma by her husband, Frank I. Guess, devisees under the will of Hattie Maude Bradford, deceased, and beneficiaries of her trust estate, filed their plea of intervention, seeking to set aside the judgment on the grounds that it was void or voidable. Their plea was overruled and they have appealed from such order.

Mrs. Bradford provided in her will that the property involved herein was given to the three Co-trustees and their successors to hold and administer as a trust for her eight children for a period of not more than 10 years after her death. The trustees had the power, however, to terminate it sooner under certain conditions. The trustees had general investments and management powers which included the power to sell, lease or convey all or any part of the estate upon such terms as the trustees considered to be for the best interest of the trust. They had the power to execute any instrument necessary to the proper management of the trust. The will further provided that the enumeration of powers was not a limitation. It provided that “In addition to the above powers my trustees shall have all powers and rights consistent with the foregoing and necessary to the successful management and control of said trust estate, whether expressly granted herein or not.”

One of the Co-executors and trustees testified that the property involved herein was being administered under a trust established by his mother’s will; that the trust has been in effect since December, 1958, and would continue for ten years thereafter, and that the trustees had the power to dispose of the property during the existence of the trust.

In their points of error, appellants contend the court erred in failing to declare the judgment void or voidable, because the devisees under Mrs. Bradford’s will were not made parties and because the beneficiaries of the trust were not made parties.

It is true that the trust instrument does not expressly grant to the trustees the authority to sue and be sued. However, when we consider the broad and unlimited powers given the trustees, we must find that it was her intention to authorize her sons and daughter named as Co-trustees to sue and be sued as trustees because this intention is reasonably manifested by the broad powers of the trust instrument.

There is no suggestion in this record that there was any conflict of interest between the beneficiaries and trustees. On the other hand their interest appears to be the same. Our Supreme Court in Slay v. Burnett Trust, 143 Tex. 621, 187 S.W.2d 377 at page 382 said:

“It is further held that the beneficiary is not a necessary party when the intention to authorize the trustee to prosecute suits in his own name is reasonably manifested by the terms of the trust instrument. * * * It is said that ‘in such cases, the trustee is in court for and in behalf of the beneficiaries ; and they, though not parties, are bound by the judgment, unless it is impeached for fraud or collusion between him and the adverse party.’ Kerrison v. Stewart, 93 U.S. 155, 160, 23 L.Ed. 843, 845.”

Our Supreme Court in Mason v. Mason, Tex., 366 S.W.2d 552 at page 554 said:

“The doctrine of virtual representation is applicable to this case. Mrs. Mason as trustee with full power to manage, control, mortgage or sell any and all of the estate with the right to enjoy and receive all of the net income therefrom during her lifetime was empowered to defend this trust and to represent all interested parties. The fact that these three named minor beneficiaries were not made parties to this action does not render the judgment void and subject to collateral attack nor does it constitute fundamental error. Where a suit is brought to cancel a trust instrument the beneficiaries are considered to be adequately represented by the trustee if their interest be not in conflict. They are proper but not necessary and indispensable parties in such a case.”

We find no merit in appellants’ contention that the judgment is voidable because the evidence revealed that one of the attorneys for the appellee prepared and probated Mrs. Bradford’s will. The evidence from the trustees disclosed that they notified one of appellee’s attorneys that Texas Electric Service Company was making surveys on their property and asked him if he would represent them and the attorney said “he could not represent us, as he had been a counsel for the Texas Electric.” Another one of the trustees testified when she said something to one of appellee’s attorneys about representing them in this matter, the attorney said, “he didn’t think he could take the case he didn’t want us to discuss the case in any way at all with him.”

We have considered all of appellants’ points and find no merit in them. They are overruled.

The judgment is affirmed.


source: Caselaw Access Project

author: DENTON, Chief Justice.

license: Public Domain

text:
    Hall JONES, Appellant, v. NAFCO OIL & GAS, INC. et al., Appellees.
    No. 7279.
    Court of Civil Appeals of Texas. Amarillo.
    Sept. 23, 1963.
    Rehearing Denied Oct. 21, 1963.
    Sanders, Scott, Saunders, Brian & Humphrey, Amarillo, for appellant.
    Simpson, Adkins, Fullingim & Hankins, Amarillo, for appellees.
   DENTON, Chief Justice.

Appellant, Hall Jones, brought this suit against appellees, Nafco Oil & Gas, Inc. and Sam Wysong, seeking damages for the death and injury of appellant’s cattle from the drinking of condensate from a gas well operated by Nafco. The trial court instructed a verdict for appellees, defendants below. Upon this verdict, the trial court rendered judgment in their behalf.

On September 22, 1959, and at all times material here, Nafco Oil & Gas, Inc. was the lessee and operator of a gas well on the section of land involved here. No other gas or oil well was located on this section. Wysong, an employee of Nafco Oil & Gas, Inc., had the responsibility of checking and maintaining this well. Appellant secured a one-year surface or grazing lease from the land owner on May 1, 1958, which was some time after the gas well was in operation. He secured another one-year grass lease in May of 1959. It is undisputed the appellant was familiar with the well and its equipment as he was on the premises at frequent intervals. No alterations to the well’s equipment had been made during this period of time. The gas well equipment consisted of a well head, two gathering tanks, a separator, pipes and fittings. This equipment, with the exception of a two inch or three inch draining pipe, was enclosed by a wire fence. This pipe, connected to the gathering tanks, extended out beyond the fence some five feet. The pipe was connected to the storage tanks by a lock-type valve called a “plug valve” which was kept padlocked. It could be opened only by unlocking the padlock with a key.

Appellant’s cause of action charging ap-pellees with negligence is alleged in the following language:

“On or about September 22, 1959, the Defendant WYSONG and/or other employees of NAFCO OIL AND GAS, INC. went to the above described well on said Section 115, at that time seeing Plaintiff’s cattle on said section of land and at that time knowing that Plaintiff’s cattle were on said section, and, through manual dumping, draining or purging of the condensate tanks and/or separator, turned a substantial quantity of condensate or condensate and salt water into the 2 or 3 inch drain pipe above described, permitting such condensate or salt water and condensate to flow out of said drain pipe outside of the fence enclosure around the tanks and separator and to gather in pools or puddles where the same was available to Plaintiff’s cattle.”
“Alternatively, Corporate Defendant and its employee, WYSONG, and/or other of its employees negligently allowed a valve from the condensate stock tanks and/or separator into the 2 or 3 inch pipe, with its open termi-nous outside the fence enclosures above mentioned, to become defective and leaky to the point to where on or about September 22, 1959, a substantial quantity of the liquids out of said stock tanks and/or separator leaked out of said tanks and/or separator through said leaky valve onto the lands above described upon which Plaintiff grazed his cattle in a substantial amount, the same gathering in pools and puddles.”

Appellant further pleaded res ipsa loquitur, and alternatively pleaded the acts of appel-lees constituted an excessive use of the land necessary to operate the oil and gas lease.

A careful study of this record reflects there was no evidence that the valve was leaky or defective. Wysong, who inspected the well almost daily, testified the valve did not leak. He had checked the well on September 21, 1959, and at eight a. m. the following day which is the date in question. He testified these inspections revealed no leakage of the valve and that he observed no cattle tracks near the drainage pipe. Appellant also testified he had never seen liquid hydrocarbon on the surface near the well prior to the date of the alleged injury to the cattle. Not only is the record silent as to the valve being defective, but the presence of condensate on the day in question was explained by one W. A. McRee, a truck driver of Groendyke Company. The latter company was employed by Nafco to haul off the condensate which had been separated from the gas and stored in the tank battery. These tanks were emptied approximately once a month. McRee, who had a key to the padlock on the valve, testified he went to the lease on the day in question sometime between ten a. m. and two p. m. Prior to pumping the condensate from the storage tanks into his truck tank, the driver testified he opened the valve on the storage tanks “to check to see if there was much water in the tanks”. He stated some “three or four or five gallons” of fluid was run through the pipe which extended from the tanks beyond the fence.

As this case falls into the category of cases often referred to as “fence” or “cow” cases, it is governed by the holding in Warren Petroleum Corp. v. Martin, 153 Tex. 465, 271 S.W.2d 410. There the Supreme Court recognized the general rule that the oil and gas lessee, even though he holds the dominant estate, must exercise his rights with due regard for the rights of the surface owner or lessee; and the Court further held that in the absence of evidence of negligence on the part of the oil and gas lessee, the plaintiff must prove the lessee either used a greater area than was reasonably necessary or that he intentionally, wilfully or wantonly injured plaintiff’s cattle. See also General Crude Oil Company v. Aiken, 162 Tex. 104, 344 S.W.2d 668; Weaver v. Reed, (Tex.Civ.App.), 303 S.W.2d 808.

Appellant pleaded two acts of negligence on the part of appellee and its employees: (1) draining condensate out onto the ground, and (2) allowing the valve to become defective thereby allowing condensate to leak out onto the ground. We are persuaded there is no evidence of a defective valve. There is evidence condensate was seen on the ground near the gas well in the afternoon of September 22. The only evidence tending to show how this occurred is the testimony by Groendyke’s employee McRee mentioned above. Ap-pellees pleaded McRee was an employee of Groendyke and further pleaded the company was an independent contractor. Mc-Ree had been employed by Groendyke as a truck driver since 1948, and there is testimony the company was paid by the barrel to haul the condensate from the well site. Assuming McRee drained the tanks and that appellant’s cattle drank this fluid, this record does not support the conclusion he was acting as an employee of Nafco. The evidence is completely to the contrary. Appellant failed to sustain its burden to prove an employee of Nafco opened the valve. 2 Tex.Jur. 2nd., page 706, Agency, Section 248, and cases there cited.

Appellant further pleaded appellees used more land than was reasonably necessary. As we understand it, appellant takes the position that the fact condensate was allowed to escape and flow from the drain pipe beyond the fenced area was sufficient evidence appellee was using more land than was reasonably necessary. This contention was rejected in Warren Petroleum Corp. v. Martin, supra, in the following language :

“The mere fact that petitioner permitted oil to escape and form in small pools within 5 feet of the well, without any showing as to the manner in which the lease was being operated at the time, could not form the basis for a legal inference that such conduct constituted negligence. Neither can such fact be used as a basis for a presumed finding that the petitioner used more land than was reasonably necessary to its oil operations. There is no evidence in this record that the petitioner used more land than was reasonably necessary.”

The record reflects no evidence as to the manner in which appellee was operating the lease at the time. We cannot presume the act of draining the tanks from the bottom to eliminate water mixed with condensate was negligence. The “bleeding” of the storage tanks prior to draining the condensate was reasonably necessary to the operation of the gas well installation. There was no showing this was not the usual and customary method of preparing the storage tanks for the discharge of condensate.

Appellant alleged an alternative plea of res ipsa loquitur. We do not believe this doctrine is applicable to this case. Appellant pleaded certain specific acts of negligence by appellees and attempted to recover thereon. These alleged acts of negligence constituted the gist of the cause of action. Under such circumstances, the doctrine of res ipsa loquitur has no application. Carter v. Simmons, (Tex.Civ.App.), 178 S.W.2d 743.

Having carefully reviewed the evidence in its most favorable. light from the view of the appellant, we are of the opinion the evidence was insufficient as a matter of law to show the acts of Nafco or its employees were negligent and the proximate cause of the death and injury of appellant’s cattle. There is a total absence of pleadings and evidence the appellees intentionally, wilfully or wantonly injured the cattle.

The judgment of the trial court is affirmed.

Affirmed.


author: WERLEIN, Justice.

text:
    The CITY OF HOUSTON et al., Appellants, v. Glenn H. McCARTHY et ux., Appellees.
    No. 14271.
    Court of Civil Appeals of Texas. Houston.
    Sept. 19, 1963.
    On Rehearing Oct. 10,1963.

      R. H. Burks, City Atty., G. Gordon Whitman, Sr., Asst. City Atty., B. F. Richard, Asst. City Atty., Houston, for appellants.
    Franklin R. Navarro and B. Rice Aston, Houston, for appellees.
   WERLEIN, Justice.

The City of Houston and the Houston Independent School District sought to recover against appellees delinquent taxes, penalties, interest and attorney’s fees for the years 1951, 1953, 1954 and 1956 to 1962, inclusive. Appellants made out a prima facie case of the validity of the assessed valuations and delinquent taxes by introducing in evidence their official records. Doneghy v. State, Tex.Civ.App., 334 S.W.2d 506, error ref., n. r. e.; Whaley v. Nocona Independent School Dist., Tex.Civ.App., 339 S.W.2d 265, error ref.; Joy v. City of Terrell, Tex.Civ.App., 143 S.W.2d 704, dism., judg. cor.; City of San Marcos v. Zimmerman, Tex.Civ.App., 361 S.W.2d 929, writ ref., n. r. e. From a judgment of the trial court in favor of appellees for all of said years except 1962, appellants have perfected their appeal.

In their first four points, briefed together, appellants contend that there is no evidence, or insufficient evidence, to show any monetary injury to appellees by reason of any illegal scheme of taxation employed by appellants and that the court erred in submitting issues with respect thereto and also erred in overruling their motions for an instructed verdict and judgment non obstante veredicto. Appellees, on the other hand, take the position that the court properly entered judgment for them since the undisputed evidence shows that appellants made no attempt to assess or collect taxes on bank accounts and savings accounts or upon household furniture and furnishings, clothing, jewelry, stocks, and bonds and other personal property in Houston, and that only 5% of such personalty was voluntarily rendered by owners, and only 15% or less of the bank accounts were tax exempt. They also assert that the jury on sufficient evidence found that appellants employed during the years 1951 to 1961 a scheme for fixing values of property for taxing purposes that was not uniform, fair and equal, and that such scheme resulted in substantial injury to appellees.

We agree with appellees that the evidence shows that the scheme employed by appellants for fixing values of property for taxing purposes was illegal, in that no effect was made to assess bank accounts and other personal property generally. Section 1 of Article VIII of the Texas Constitution, Vernon’s Ann.St. provides that: “Taxation shall be equal and uniform. All property in this State * * * shall be taxed in proportion to its value.” City of Arlington v. Cannon, 1954, 153 Tex. 566, 271 S.W.2d 414.

The burden was on appellees, however, to show that they suffered substantial injury as a result of appellants’ failure to assess hank accounts and other personal property. It is not enough to show that an illegal system of rendering and assessing taxes was employed. In State v. Federal Land Bank of Houston, 160 Tex. 282, 329 S.W.2d 847, our Supreme Court, through Justice Greenhill, said:

“But while the Land Bank did prove an arbitrary and illegal scheme of ad valorem taxation, that fact alone under the facts here does not of itself entitle it to relief. This is not a direct attack on the scheme of taxation or a suit to prevent the initiation or operation of an illegal scheme. No relief was sought by mandamus or injunction. Here the taxpayer sat by and allowed the plan to be put into operation without even a suggestion of a protest, objection, or appeal. The County and the other taxpayers have proceeded under the plan. The point is made only after the county-wide valuations have been fixed and adjusted in the board of equalization, the taxes levied, assessed, and presumably paid by the other taxpayers in the county. Under those circumstances, the Land Bank must assume a very heavy and onerous burden.”

The present case does not constitute a direct attack on the scheme of taxation or a suit to prevent the initiation or operation of an illegal scheme. No relief was sought by mandamus or injunction. The taxpayers sat by and allowed the plan to be put into operation without even a suggestion of a protest, objection, or appeal. Other taxpayers have proceeded under the plan.

The Court, in State v. Federal Land Bank of Houston, supra, also said:

“The government does not lose its right to taxes on one parcel of property by reason of the failure of its officers, either negligently or designedly, to assess other property that is likewise taxable. Once such a plan is put into effect, the litigant may defeat the recovery of taxes only to the extent that they are excessive; and he must prove the excessiveness. City of Arlington v. Cannon, 1954, 153 Tex. 566, 271 S.W.2d 414. When the attack is made because the taxing authority has followed an arbitrary plan or scheme, the taxpayer, to prevail, must show not only that the plan was an arbitrary and illegal one but also that the use of the plan worked to his substantial injury. State v. Whittenburg, 1954, 153 Tex. 205, 265 S.W.2d 569.”

Appellees have failed to prove by sufficient evidence that their taxes were substantially higher by virtue of the omission of the taxable personal property and the failure to assess such property at its market value. The burden was on them not only to prove excessiveness but the extent thereof. City of Arlington v. Cannon, supra; Whelan v. State, 1955, 155 Tex. 14, 282 S.W.2d 378; State v. Whittenburg, 1954, 153 Tex. 205, 265 S.W.2d 569; City of Orange, Texas v. Levingston Ship Building Co., 5 Cir. 1958, 258 F.2d 240. The jury finding that the scheme employed by appellants for taxing property resulted in substantial injury to appellees is not supported by sufficient evidence.

The jury also found that the failure of appellants during the years 1951 through 1961 to collect or assess taxes, or assess or collect taxes on bank accounts, savings and loan accounts, furniture, jewelry, stocks and bonds, and clothing, did not result in substantial injury to appellees, and that if the City had during such years attempted to assess and collect taxes, and had collected taxes on such personal property, appellees’ tax bill would not have been lessened. The answers of the jury to these last two issues support appellants’ contention that appellees failed to prove that they had suffered substantial damage as a result of the omission of appellants to assess and tax personal property generally within the jurisdiction of the taxing authorities. The findings of the jury to these two issues seem in conflict with the finding that the scheme employed by appellants resulted in substantial injury to appellees, since the main basis for the finding that the scheme employed was not uniform, fair and equal, apparently was the failure of appellants to assess and collect taxes on personal property.

The parties entered into a stipulation to the effect that appropriate officials of the various 66 banks and 16 savings and loan associations in Houston would, if present, testify as to the total amounts of money on deposit in their respective institutions as of December 31 of the years 1951 through 1961; and that other competent witnesses would testify as to the retail value of furniture, jewelry, clothing, stocks and bonds, and other personal property in Houston and owned by citizens of Houston during such years; and that such property was omitted from the tax rolls, and no effort was made to assess or collect taxes thereon; and that had such property not been omitted therefrom there would have been an increase in tax revenue available in an amount in excess of $50,000,000.00 for “a total of the years mentioned, 1951-1961.”

It was not shown how much additional tax money would have been available any one year. Only the total for the eleven-year period was given and such eleven-year period included two years for which the City and School District were not seeking to recover any taxes. The record shows the tax delinquency of appellees for each year in question, and also the amount of the City budget for each of such years, but it fails to show the amount of the School District budget for any of such years. Nor does the record show how much additional money would be available each of such years for City and School District maintenance and bond service. Furthermore, there is no evidence as to the amount or value of taxable bank accounts, savings, furniture, stocks, bonds and other personal property that may have been owned by appellees, nor of the amount of additional taxes that appellees might have been required to pay each year had all of their own personal property and all personal property, except that exempt, been taxed as they contend it should have been.

In Whelan v. State, supra, the court stated that petitioners had rendered their “cash on hand” each of the years in question. The court further said: “We cannot assume that the amount so rendered did not include money on deposit in banks. If it did not that fact may be developed on another trial.” We are of the opinion that since the burden of proof was on appellees to establish substantial injury, it devolved upon them to show that had the correct scheme of taxation been employed, and had all of their personal property and all other taxable personal property been assessed and taxed each of such years, the amount of their tax would have been decreased each year in some definite amount. This they failed to do. City of Orange, Texas v. Levingston Ship Building Co., supra. Moreover, they presented no testimony or evidence as to the true value of their property or that other comparable property was assessed at a lower valuation than theirs, or what their tax bill would have been had another system of rendering and assessing property been used, or how much of their taxes were not owing and should be avoided. Then, too, the jury found against appellees on their contention that the failure to assess and collect taxes on personal property resulted in substantial injury to them, or that their tax bill would have been lessened by assessing personal property.

The law places a most onerous burden upon the taxpayer in cases like this. In City of Arlington v. Cannon, supra, our Supreme Court said: “The difficulties to be encountered in making the necessary proof as a basis for relief is the penalty the taxpayer must pay for sitting idly by while taxing authorities put into effect a plan of taxation which deliberately permits certain classes of property to escape taxation.”

The jury found that appellants’ assessed taxes for the years 1951, 1953 and 1954 were on more than the 10.143 acres owned by appellees, and that for the years 1956 to 1960, inclusive, were on more than the 8.492 acres owned by them. The evidence is insufficient to support such findings. As hereinabove stated, appellants made out a prima facie case for the recovery of the delinquent taxes in question. They alleged in their petition the correct amount of acreage upon which taxes had been assessed for each of the years involved and the amounts of delinquent taxes. Evidence was introduced showing that the taxes due were on the correct amount of acreage alleged and that suit was brought to collect delinquent taxes on the correct amount of acreage owned by appellees for the years the taxes were delinquent. The testimony of Richard G. Parks, Tax Assessor-Collector of the City of Houston and the Houston Independent School District, shows the acreage owned by appellees which was assessed during each of the years in question. There is no sufficient evidence or contention by appellees that they did not own such acreage for such years as testified to by Mr. Parks.

It was error to tax court costs against appellants. Under Articles 7297, 7333 and 7343, Vernon’s Annotated Texas Statutes, costs accruing in a suit to recover delinquent taxes may not be charged against the taxing authority. Electra Independent School District v. W. T. Waggoner Estate, 1943, 140 Tex. 483, 168 S.W.2d 645; Lubbock Independent School Dist. v. Owens, Tex.Civ.App., 217 S.W.2d 186, writ ref.; Grant v. Ellis, Tex.Com.App.1932, 50 S.W.2d 1093. We have been furnished a certified copy of an order of the Supreme Court retaxing the costs of court in Whelan v. State, supra, and ordering that the petitioners, D. E. Whelan and R. J. Whelan, and their surety, pay all court costs expended • in the Supreme Court, Court of Civil Appeals, and District Court.

Appellants contend that the trial court erred in refusing to award attorney’s fees in the amount of 5% sought by appellants. The Charter of the City of Houston, which was offered in evidence, Article III, Sec. 8, expressly sets the attorney’s fees sought by appellants at 5% of the judgment and directs that such amount shall be taxed as costs against the property upon which the tax is due and unpaid. Article 7345b, Sec. 6, however, under which this suit was brought and which is controlling, provides in effect that all court costs in any suit brought by or in behalf of any taxing unit for delinquent taxes, together with such reasonable attorney’s fees as may be incurred, not exceeding 10% of the amount sued for, such attorney’s fees to be subject to the approval of the court, shall be chargeable as court costs.

Appellants offered no proof as to the amount of a reasonable attorney’s fee, and no objection was made to the court’s charge for failing to submit such issue to the jury. They, therefore, waived attorney’s fees. In view of the fact that this case must be reversed for another trial, it is pointed out that the question of the amount and reasonableness of the attorney’s fees should have been submitted to the jury. Holstein v. Grier, Tex.Civ.App., 262 S.W.2d 954; Gulf Paving Co. v. Lofstedt, 144 Tex. 17, 188 S.W.2d 155; Article 7345b, Sec. 6, V.A.T.S.

Reversed and remanded.

On Motions for Rehearing

Appellants have called our attention to the fact that we have reversed the entire judgment of the trial court, including the part thereof in favor of appellants for delinquent taxes for the year 1962, although such part of the judgment is not complained of or assigned as error by either party.

Our opinion is, accordingly, corrected and reformed so as to reverse the judgment of the trial court and remand the cause, except that part of the judgment in favor of appellants for taxes for the year 1962, penalties and interest thereon and foreclosure of their tax lien therefor, which part of the judgment will remain undisturbed.

Appellees’ motion for rehearing is overruled. Appellants’ motion for rehearing is in part granted and in part refused.


author: CHAPMAN, Justice.

text:
    NATIONAL EMPIRE LIFE INSURANCE COMPANY, Appellant, v. FIRST NATIONAL BANK IN LOCKNEY, Appellee.
    No. 7263.
    Court of Civil Appeals of Texas. Amarillo.
    May 27, 1963.
    Rehearing Denied Oct. 21, 1963.
    Fulbright, Crooker, Freeman, Bates & Jaworski, Houston, for appellant.
    Ben P. Ayres, Floydada, G. W. Suggs, Lockney, for appellee.
   CHAPMAN, Justice.

Group Credit Life Insurance governed by Article 3.50 of Texas Insurance Code, Vernon’s Ann. Texas Civ.St. constitutes the statutory subject matter of this suit.

Upon a trial to the court judgment was rendered for First National Bank in Lock-ney against National Empire Life Insurance Company upon two Group Credit Life insurance certificates in the total face amount of $10,000 representing insurance purchased by the creditor bank upon the life of M. R. Moran, one of the bank’s debtors in the credit group to whom loans or loan commitments had been made for those with seasonal incomes engaged in general agricultural or horticultural operations under the provisions of Subsection (4) of Section 1 of Article 3.50, Insurance Code. No findings or conclusions were requested or filed.

On May 14, 1959, Columbia General Life Insurance Company, hereinafter called Columbia, (later merged into appellant Company), issued to appellee, as policyholder and beneficiary thereof, Group Policy No. 2050, by the terms of which it agreed to insure the lives of such debtors as appellee might thereafter from time to time designate and to pay to appellee the proceeds of such insurance upon due proof of death of any debtor so insured. M. R. Moran was one of those designated in the group and had been a recipient of agricultural and horticultural loans from appellee bank for many years.

On February 8,1961, M. R. Moran applied for and was granted a loan commitment by appellee bank in the amount of $10,000 upon agreement he would repay such loan and for repayment of which he was to be personally liable. That commitment remained in effect until his death on August 24, 1961.

On April 4, 1961, Moran being then indebted to appellee in excess of $5,000, ap-pellee forwarded to Columbia a certificate of insurance dated that day designating Moran as a debtor for insurance upon his life in the amount of $5,000 under such group policy and paid the premium prescribed by the policy. Moran having obtained further advances from that date to August 24, 1961, appellee on May 21, 1961, forwarded another certificate of insurance in the amount of $5,000 designating him as the debtor for insurance upon his life and paying the premiums required. It continued advancements until the loans to him exceeded $10,000. All certificates and premiums were accepted and retained by Columbia, though the amount of the premiums were tendered back to appellee by appellant during the trial.

Appellant based its defense upon two contentions. The first was that appellee suppressed material facts concerning the physical condition of Moran, in that he was, prior to and at the time of issuance of the certificates, afflicted with inoperable cancer, which facts were or should have been well known by the bank and which facts, appel-lee, as agent of appellant under the group policy was under duty to report.

In the first place appellant has, in its brief, proceeded upon a premise unsupported in the record in that it takes the position that Neill and Minor, vice-presidents of the bank during the times involved in the controversy, knew of Moran’s terminal cancer long before the issuance of the certificates of insurance in question. These facts the officers vehemently denied. Neill testified he did not learn that Moran was supposed to have cancer until after his death. “I first learned that he died of a heart attack and then later and I don’t recall who it was now, someone told me he had cancer.” In reply to cross examination by counsel for appellant of Mr. Neill’s answers in his deposition, which appeared to be contrary to his testimony, he replied in effect that counsel for appellant made such statements and that he did not want to sign the deposition, “because I didn’t say that.” Under the record made here we believe it requires no citation of authority to say the court as the fact-finding body had the authority to accept or reject the deposition testimony that was contrary to the positive testimony given in the trial of the case. Particularly is this true in view of the fact that at the time the testimony was given Mr. Neill had no interest in or connection with the bank and could have had no selfish reason for the testimony he gave.

Mr. Minor, vice-president of appellee bank from 1958 down to and including the time of trial, testified that at the time of the issuance of the two certificates he had heard nothing of Moran having cancer and that so far as he could recall he first heard it at about the time of his death.

Where no findings of fact or conclusions of law have been requested or filed in a case tried to the court, we must test the validity of the trial court’s judgment on the assumption that the trial court found every disputed fact in such way as to support the judgment rendered. Construction & General Labor Union, Local No. 688 v. Stephenson, 148 Tex. 434, 225 S.W.2d 958.

Additionally, the Group Policy contained no reference to insurability or proof of insurability except in the following paragraph :

“INCONTESTABILITY. The validity of this Group Policy shall not be contested, except for nonpayment of premiums, after it has been in force for two (2) years from its date of issue; and no statement made by any Debtor insured under this Group Policy relating to his insurability shall be used in contesting the validity of the insurance with respect to which such statement was made after such insurance has been in force prior to the contest for a period of two years during such Debtor’s lifetime, nor unless it is contained in a written instrument signed by him.”

Apposite to the lack of insurability requirements in our case is the statement by the Supreme Court of Texas in Board of Ins. Com’rs. v. Great Southern Life Ins. Co., 150 Tex. 258, 239 S.W.2d 803, wherein the Court said:

“Inherent in most, if not all, ventures of group underwriting of life insurance is the willingness of the insurer, being first assured of a sufficient spread of risks to enable it to secure a reasonable cross section of normally healthy lives, to make concessions it would not make to the individual applicant for insurance. , The volume of business and the consequent minimizing of expense will justify the concessions. Usually the major concession is the waiver of the insurer's right to require evidence of insurability." (All emphases herein are ours unless otherwise designated.)

Section 2 of Article 3.50 of the Insurance Code provides in part:

“No policy of group life insurance shall be issued or delivered in this State unless and until a copy of the form thereof has been filed with the Board of Insurance Commissioners of the State of Texas and formally approved by such Board, nor shall any policy of group life insurance be delivered in this State unless it contains in substance the following provisions, or provisions which in the opinion of the Commissioner are more favorable to the persons insured, or at least as favorable to the persons insured and more favorable to the policyholder, * *

Following the provisions of the Article and Section of the Insurance Code just quoted the statute contains a number of enumerated standard provisions of Group Life Insurance, among which is Subdivision (4) providing:

“A provision setting forth the conditions, if any, under which the insurer reserves the right to require a person eligible for insurance to furnish evidence of individual insurability satisfactory to the insurer as a condition to part or all of his coverage.”

Additionally still is the following provision in the Group Policy sued upon:

“ENTIRE CONTRACT. This Policy and the application of the Creditor, a copy of which is attached, shall constitute the entire contract. All statements made by the Creditor or by the insured Debtor shall be deemed representations and not warranties, and no statement is or has been furnished to the Debtor or to his beneficiary.”

The record is silent as to any statement of insurability made either by appellee or the debtor as to the latter’s physical condition or insurability. We, therefore, hold such requirement was waived and appellant’s point one is without merit.

In its second point appellant contends that the certificates of insurance having been issued at other and different times than the creditor beneficiary bank made loans to the debtor, both the Group Policy contract and the Group Credit Life Statutes of Texas were violated by such certificates and did not create any valid insurance contract.

The initial statement of Article 3.50, Insurance Code, “Group Life Insurance”, says: “No policy of group life insurance shall be delivered in this state unless it conforms to one of the following descriptions.”

Among the descriptions which follow is Subsection (4). That part of Subsection (4) applicable to the instant case and germane to appellant’s second point provides :

“(4) A policy issued to a creditor, who shall be deemed the policyholder, to insure debtors of the creditor, subject to the following requirements:
“(a) The debtors eligible for insurance under the policy shall all be members of a group of persons numbering not less than fifty (50) at all times, who became borrowers * * * under agreement to repay the sum borrowed * * * or the face amount of any loan or loan commitment, totally or partially executed, made to a debtor •with seasonal income by a creditor in good faith for general agricultural or horticultural purposes, secured or unsecured, where the debtor becomes personally liable for the payment of such loan, but not to exceed Ten Thousand Dollars ($10,000.00) on any one life. * * ⅜
“(d) The insurance shall be payable to the policyholder. Such payment shall reduce or extinguish the unpaid indebtedness of the debtor to the extent of such payment; provided that in the case of a debtor with seasonal income, under a loan or loan commitment for general agricultural or horticultural purposes of the type described in paragraph (a), the insurance in excess of the indebtedness to the creditor, if any shall be payable to the estate of the debtor or under the provision of a facility of payment clause.”

Appellee’s vice-president Carroll Minor, detailed in his testimony the practices of the bank in making loans of the nature contemplated by Subsection (4) of Section 1 just quoted. Without quoting such testimony verbatim here, it was to the effect that farmers come into the bank early in the year to make arrangements for the financing of their agricultural operations for that particular year; that the bank makes loan commitments for the amount of financing they will furnish and usually take chattel mortgages on the borrower’s farm machinery and the crops to be grown that year; they have from 150 to 200 agricultural borrowers each year; if the farmer is an old established borrower the loan officer usually initiates the first disbursement but if he is a new customer it must be approved by the loan and discount committee; the bank enters into a committed amount with the borrower, which amount is stipulated in writing on the application for loan; the bank considers the commitment very binding; a portion of the amount of the loan is usually disbursed at the time the application is approved, then various amounts are disbursed as the need arises and a note is made at the time of disbursement; the chattel mortgages used to secure the payment of the notes have an after-incurring indebtedness clause in them.

Specifically as to Mr. Moran, the testimony shows he was an agricultural borrower with a seasonal income and had been •ever since Mr. Minor’s connection with the hank beginning in 1958; his application for approval of a loan for $10,000 for 1961 was approved on February 8, that year and he received initially $2,000 upon the commitment. He continued to receive advancements through the year until the total exceeded $10,000.

On April 4, 1961, at a time when advancements to Moran had been made by the bank in the total sum of $5,250, ($1,250 of which was a balance on a note for farm machinery carried over from 1960, due in 1961, and which was not regarded by appellee as within the loan commitment), appellee forwarded to appellant a certificate of insurance dated April 4, 1961, upon Moran in the amount of $5,000; on May 21, 1961, when advancements by the bank to Moran totaled $8,505.48 a second certificate in the amount of $5,000 was forwarded; at the time of his death on August 24, 1961, he was indebted to appellee in the total sum of $11,505.48, including the $1,250 equipment loan; premiums were paid on both certificates and retained by Columbia; Moran had been similarly insured by two certificates in the same amount in 1960; the same practice generally was followed with other agricultural borrowers as was followed with Moran in 1961.

Article 4764a (Article 3.50, Insurance Code) before 1955 did not contain Subsection (4) with respect to loan commitments made to those with seasonal income pursuing agricultural or horticultural activities within the statutory authority of Group Policy Insurance. Acts 1955 of the 54th Legislature, Senate Bill 369, Chapter 247 added that amendment and in the enacting clause stated it was for the purpose of allowing “insurance of the face amount of a loan or loan commitment made to a debtor with seasonal income for general agricultural or horticultural purposes; * *

The Group Policy in question under “Errors or Omissions” provides it is “mutually understood and agreed that while this Group Policy remains in force no errors or intentional omissions by the Creditor or company shall deprive any eligible Debtor of insurance, nor secure for any Debtor insurance, except in accordance with the insurance schedule, * * * ”

Under “Reports” the policy provides: “The Creditor shall, upon request of the Company, furnish the Company with the names of all Debtors initially insured and the amount of their respective indebtedness and likewise of all Debtors subsequently insured hereunder.”

The “Eligibility” clause provides each debtor of the creditor shall automatically become insured from the first day, on or after the effective date of the Group Policy, on which he is indebted to the creditor.

The “Insurance Schedule” provides:

“Each Debtor shall be insured at any time for the amount necessary to then discharge the Debtor’s indebtedness to the Creditor of the classes specified in the Application, but not exceeding $10,000.
“It is agreed that particulars required by the Company concerning Debtors proposed to be covered immediately or in the future, and Debtors whose coverage is to be changed or cancelled, shall be furnished monthly to the Company on forms provided by it.”

We believe the record here made would require us to hold that appellant in maintaining for almost three years prior to this controversy a Group Policy with ap-pellee, whom the evidence shows is primarily an agricultural lending bank, was obligated by the lending operations on loan commitments with the debtors practiced by the bank and provided for in the Policy, and that they also contracted with reference to notices or reports to the company.

The record is void of any form of report ever required of appellee bank as to coverage of debtors except the certificates of insurance introduced into evidence.

If these provisions appear in conflict with other provisions of the policy, then * * * this is an appropriate case for the application of the rule that ambiguous terms of an insurance policy should be construed in favor of the insured where they are reasonably susceptible of such a construction.” Lloyds Casualty Insurer v. McCrary, 149 Tex. 172, 229 S.W.2d 605 and cases there cited on the point. See also Standard Life & Accident Insurance Co. v. Hardee, Tex.Civ.App., 330 S.W.2d 544 (NRE). We believe they are reasonably susceptible of such construction in this case. Accordingly, the judgment of the trial court is in all things affirmed.


text:
    Marie Whitty WHITE et al., Appellants, v. BROOKLINE TRUST COMPANY et al., Appellees.
    No. 7278.
    Court of Civil Appeals of Texas. Amarillo.
    Sept. 23, 1963.
    Rehearing Denied Oct. 21, 1963.
    Steeger, Dohoney, Jones & Caldwell, Houston, for appellants.
    Spafford, Freedman, Hamlin, Gay & Whitham, Dallas, for appellees.
   CHAPMAN, Justice.

The construction of an instrument in the form of a power of attorney constitutes the principal subject matter of this suit. The case is before us upon an appeal from the trial court’s action in sustaining special exceptions.

Appellants, Marie Whitty White, et al., assert the instrument was executed in 1928 in favor of and to their predecessor, James B. Watson, by the heirs of David Wallace, predecessors of appellee, Brookline Trust Company.

There are ancillary questions raised concerning the extent of the trial court’s action in sustaining appellees’ special exceptions contained in their Paragraphs One and Two of their Second Amended Answer to appellants’ Fifth Amended Original Petition, but the principal question presented to us is whether the instrument shows a present or future intention to convey minerals. We do not believe it is necessary to write on the other question. (All emphases herein are added).

Since all parties have agreed through their counsel that the intentions of the parties must be ascertained by construing the whole instrument from its four corners, we believe it well at the outset of this opinion to copy verbatim therefrom Paragraphs (1), (2), and (3) and the two paragraphs preceding Paragraph (1).

The instrument starts by saying:

“AGREEMENT made this 14th day of November, 1928, by.parties of the first part, and JAMES B. WATSON, .party of the second part,
“WITNESSETH:
* * *
“WHEREAS said Watson has investigated and is investigating the titles to said estates,
“NOW, THEREFORE, in consideration of the premises and of one dollar ($1.00) and other valuable considerations paid by each of said parties to the other, the receipt whereof is hereby acknowledged, it is agreed by and between said parties as follows:
“(1) The parties of the first part do hereby fully authorize and empower the party of the second part to represent the parties of the first part in all matters pertaining to the interests of the parties of the first part in and to any and all mining and mineral estates wherever located in said Counties, to bring or defend suits with regard to same in the proper State cmd Federal Courts of said State, with authority to remove all such matters from Court to Court as may be legally proper, to prosecute such matters to final judgment and to settle any and all claims affecting the interests and titles of the parties of the first part thereto, with or without suit in such manner as he may deem best or advisable for the protection thereof, to correct defects of title of the parties of the first part thereto by preparation of proper written instruments and to represent the parties of the first part as their attorney in aniy and all suits that may be filed against the parties of the first part by reason of the interests of the parties of the first part in said mineral estates.
“(2) The party of the second part is to render all such services and perform such acts as he may deem advisable or necessary to do in connection with same, without expense to the parties of the first part or to said estate of David Wallace, and is to hold the parties of the first part and the said estate of David Wallace harmless and indemnified from any expenses which shall1 be incurred by the party of the second! part in connection therewith.
“(3) The party of the second part for compensation for such services as have been rendered or may be rendered by him in coimection with said mineral estates, shall be entitled to receive one-half of all the proceeds received from the sale or other disposition of said mineral estates or the interests of the-parties of the first part therein, including one-half of all sums that may be-received by the parties of the first-part therefrom in the nature of rents, royalties or other income in any way-derived from said interests.”

A cursory glance at the instrument makes it obvious from the outset that it does not contain the statutory suggested form of words of grant conveying a present legal title to minerals underlying, or a mineral interest in lands, nor equitable interest in such lands. However, in this state inaccuracy of expression or the inaptness of the words used in the instrument are not fatal if the intention to pass the title can be discovered from a careful consideration of the instrument as a whole and the surrounding circumstances, or the instrument manifests by its terms the intention of the grantor to convey to the grantee. Baker v. Westcott, 73 Tex. 129, 11 S.W. 157; Harlowe v. Hudgins, 84 Tex. 107, 19 S.W. 364.

A study of all the cases cited and those found from independent research have not revealed a case directly in point on the facts before us where a court of last resort has decided it.

Our own court in Easley v. Brookline Trust Co., Tex.Civ.App., 256 S.W.2d 983, decided in 1952, passed on the very question before us. This court in passing upon the instrument here being considered, with none of the present members of the court then sitting said:

“The agreement under which appellants claim attorney Watson was vested with title does not go that far as such agreement states Watson 'shall be entitled to receive one-half of all the proceeds received from the sale or other disposition of said mineral estates or the interests of the parties of the first part therein and including one-half of all sums that may be received by the parties of the first part therefrom in the nature of rents, royalties or other income in any way derived from said interest.’ ”

Petitioners, appellants in our court in that case, in their application for a writ to the Supreme Court of Texas raised the exact point in their Point Three as follows:

“The court erred in holding that the contract between the Wallaces and Watson did not upon its execution vest Watson with a present interest in real estate.”

The Supreme Court refused a writ with a notation of N.R.E. Unfortunately there were other points upon which they could have stamped the N.R.E. Though it is impossible under such circumstances for us to know if it agreed with the respondents on that particular point in connection with the rejection of the writ, we do not feel justified in completely disregarding the case.

Additionally, a careful study of the instrument from its four corners and the circumstances surrounding its execution has convinced us that it does not manifest a present intention to convey legal or equitable title to the minerals in question.

The very first word of the instrument, “Agreement”, suggests the author of the instrument presumed there would be agreements on both sides as distinguished from a unilateral action such as a grant, though this record is silent as to whether such agreement was ever made or delivered or that the attorney ever asserted any claim to the minerals.

The instrument next recites ownership in the Wallace heirs of all the minerals involved, recites employment of Watson as their attorney to represent them in all matters pertaining to such minerals, to prosecute and defend to final judgment all suits or claims affecting their interests or titles and then provides as his compensation for such legal services he shall be entitled to one-half of all the proceeds received from the sale or disposition of the mineral estates or the interests of the mineral owners, including one-half of all sums the parties of the first part (the Wallaces) might receive in the nature of rents, royalties or other income derived from said interests.

We believe the words “proceeds received from the sale of said mineral estates” and “one-half of all sums that may be received by the parties of the first part * * * ” included in numbered Paragraph Three must be given meaning. When they are given meaning they seem to us to be incompatible with a present intention to convey. There seems to us to be no escape from the conclusion that the attorney was to receive his fee for his legal services from the sums received by the Wallace heirs from their disposition of the minerals inherited from David Wallace after the attorney had corrected the defects of title by prosecuting or defending to final judgment all suits in connection therewith or settling any claims affecting the interests and titles of the first parties thereto.

Though' not directly in point the situation has some analogy to Carroll v. Hunt, 140 Tex. 424, 168 S.W.2d 238.

There, for legal services in connection with contesting a will the attorney was to receive a compensation of one-eighth of the property recovered to be paid in cash or kind. Justice Smedley in speaking for the court said:

“There are no words of present assignment, transfer or conveyance * * *. They promise to give a part of what may be recovered or to make payment in cash out of the proceeds recovered.”

The court held the letter instrument indicating an intention to pay a one-eighth interest in money or in kind was to be after successful termination of the litigation and the payment was in consideration of services to be performed by the attorney.

Also, in Browne v. King, 111 Tex. 330, 235 S.W. 522, the interest of the attorney was a future one, when the property was recovered, and then only in consideration of the performance of the attorney’s part of the contract. Those two cases are at least analagous to our own in that the attorneys in all of them were required to perform in the future. Unless they performed they had no interest in the recovery of the property or the fees. In Browne v. King, supra, the court held:

“The necessity for future action on Browne’s part as the condition for the-vestiture of any interest in his favor-made the contract purely executory.”

We, therefore, hold that the contract in-the instant case, if it was entered into by Watson, was a contingent fee agreement executory in nature and did not constitute a legal or equitable assignment of a present interest in the minerals.

This conclusion has some support in the-fact that the attorney never filed the instrument for record. Surely an attorney with the legal ability to command one-half of all sums the owners would be able to sell the minerals for under eight sections of land,, for his services in clearing title, would know to file the instrument for record if he was-claiming it as a grant of a present interest in the minerals. The record in Easley v. Brookline Trust Co., supra, in our court shows the instrument was not filed for record in Foard County until 1951, more than-20 years after its purported execution and' then not by the attorney.

We are not unmindful of the line of cases-represented by Green v. Biddle, 8 Wheat. 1, 5 L.Ed. 547, Sheffield v. Hogg, 124 Tex. 290, 77 S.W.2d 1021, and Frazier v. Hanlon Gasoline Co., Tex.Civ.App., 29 S.W.2d 461 (writ refused). We just believe they are-distinguishable on their facts to the instant case. For example, in the latter case the instrument said: “Party of the First Part does hereby vest Parties of the Second’ Part with one-half interest * * Further, the attorneys in that case had the right, to and did take control of the water and the sales of such waters to third parties. No-such situation existed in the instant case.

The judgment of the trial court is affirmed.


author: PHILLIPS, Justice.

text:
    Robert S. CALVERT et al., Appellants, v. PANHANDLE EASTERN PIPE LINE COMPANY et al., Appellees. Robert S. CALVERT et al., Appellants, v. TENNESSEE GAS TRANSMISSION COMPANY, Appellee.
    Nos. 11118, 11119.
    Court of Civil Appeals of Texas. Austin.
    Oct. 23, 1963.
    Behearing Denied Oct. 30,1963.
    Waggoner Carr, Atty. Gen., Joseph Trim-ble and Paul Phy, Asst. Attys. Gen., Austin, for appellants.
    John G. Brendel, Stone Wells, Houston, Wade Spilman, William E. Wells, Austin, for appellee Tenn. Gas Transmission Co.
    R. Dean Moorhead, Austin, Wendell J. Doggett, William S. Richardson, Kansas City, Mo., Head & Lyle, Corpus Christi, Arthur R. Seder, Jr., Chicago, Ill., Paul S. Davis, Detroit, Mich., F. Vinson Roach, Ralph P. Blodgett, Omaha, Neb., Fulbright, Crooker, Freeman, Bates & Jaworski, Austin C. Wilson, Richard L. McGraw, Houston, Clark, Thomas, Harris, Denius & Winters, Austin, Ross, Hardies & O’Keefe, Charles C. McDugald, William W. Brack-ett, Chicago, Ill., for appellees Panhandle Eastern Pipe Line Co. and others.
   PHILLIPS, Justice.

These cases were filed and briefed separately, however they were submitted and argued together, present the same questions, consequently we will determine the issues in one opinion.

This is an appeal by the Comptroller of Public Accounts, the Attorney General and the Treasurer of the State of Texas from a judgment of the District Court declaring the Dedicated Reserve Tax Act, Article 3.11 of Title 122A, Vernon’s Ann.Rev.Civ.St. to be unconstitutional and void for the reasons that the tax levied by the Act is prohibited by the Commerce Clause of the Constitution of the United States and is discriminatory in violation of the provisions of Article I, Sections 3, 16 and 19, Article VIII, Sections 1 and 2, of the Constitution of the State of Texas, Vernon’s Ann.St., and of the due process and equal protection clauses of the Fourteenth Amendment to the Constitution of the United States. The judgments ordered a refund to appellees (plaintiffs below) of all taxes paid and to be paid by them under protest.

We sustain the judgment of the Trial Court in the proposition that the tax levied is prohibited by the Commerce Clause of the Constitution of the United States, consequently we will not discuss the second part of the Trial Court’s holding that the tax is discriminatory.

Under Section (1), subsection II of the Act before us there is an attempt to classify the appellees herein as producers: " * * * to recognize and clarify fully by statute the relation between various persons engaged in the occupation of producing natural gas so that the taxpayer in each instance may be identified clearly, and so that all persons so engaged in the occupation of production will bear equitably the taxes imposed in connection with the severance of gas from Texas soil.” And further: “Pursuant to this policy it is recognized that contractual relations [hips] exist in such natural gas production occupation between several definable groups, all engaged integrally in such occupation of severance of natural gas from the soil and all having such a direct and beneficial interest in the production of gas that for the purpose of taxation they may be classified as producers of gas. It is the policy of the State of Texas to recognize that all such persons, integrally engaged in the occupation of severance of natural gas from the soil-producers, severance producers and dedicated reserve producers, have a taxable interest in production of gas in Texas.”

There is no dispute in that each of the appellees before this Court come under the provisions of the Act in question as a “dedicated reserve producer” or “severance beneficiary” as set out in (b) and (c) of Section (2).

There are stipulations to the effect that all of the gas purchased by appellees, except for relatively minor quantities sold in Texas or used as fuel for appellee’s compressor stations, has a destination outside the State of Texas through every stage of the production, gathering, processing, sale to appellees, and transmission and sale in markets other than in Texas. All of such gas moves in a continuous stream from the producing wells to markets in other states, without break, in a steady flow, ending, as-contemplated from the beginning, at points-outside the borders of Texas.

Appellees perform only two activities in Texas in connection with such gas; by purchase they take the gas under the varying circumstances summarized above;, and they transport such gas out of Texas-in interstate commerce.

For purpose of illustration we come again to the factual situation of appellee-Michigan Wisconsin Pipe Line Company..

Michigan Wisconsin owns a pipeline that runs approximately one-half mile from the outlet of a gasoline plant owned and operated by Phillips Petroleum Company in Hansford County, Texas, to a point on the-Texas-Oklahoma border where such line leaves Texas. Michigan Wisconsin purchases residue gas from Phillips at the-outlet of such plant. Michigan Wisconsin-, transports such residue gas through such, pipeline out of Texas in interstate commerce. There are stipulations to the effect that this company produces no gas in Texas or elsewhere. It gathers no gas in Texas. All the gas which it obtains in Texas, is residue gas, which is the gas remaining-from natural gas as produced at the wells-after certain liquefiable hydrocarbons have been removed from it. Such residue gas is-delivered to Michigan Wisconsin by Phillips Petroleum Company at the outlet of a. gasoline plant owned by Phillips in Hans-ford County, Texas. Concurrently with such delivery, such gas flows immediately into the facilities of Michigan Wisconsin for transportation by it to markets outside Texas.

For the purposes of this opinion it will not be necessary to further deliniate the variations in obtaining gas used by the remaining appellees herein since Section (7) of the Act before us declares its provisions nonseverable and that if any portion thereof is declared invalid as to any severance beneficiary, it shall be invalid as to the producer and all other severance beneficiaries.

In Michigan-Wisconsin Pipe Line Company v. Calvert, 347 U.S. 157, 74 S.Ct. 396, 98 L.Ed. 583, the Supreme Court of the United States in declaring the Texas “Gas Gathering Tax” unconstitutional described the identical purchase of gas by Michigan Wisconsin that is set out above. In this case the Court stated that the problem was not whether the State could tax the actual gathering of all gas whether transmitted in interstate commerce or not but whether the State had delayed the incidence of the tax beyond the step where production and processing had ceased and transmission in interstate commerce had begun. The Court held that the incidence of the tax was the “taking” of gas from Phillips’ gasoline plant; that this event had occurred after the gas had been produced, gathered and processed by others than Michigan Wisconsin; that the “taking” into Michigan Wisconsin’s pipeline was solely for interstate transmission and the gas at that time was not only actually committed to but was moving in interstate commerce. The Court, in striking down this tax as a burden on interstate commerce further observed that it would permit a “multiple burden” upon that commerce in that if the fiction urged to uphold the tax was validated, other states through which the gas passed could indulge in a similar venture, the net effect of which would be substantially to resurrect the customs barriers which the Commerce Clause was designed to eliminate.

In Calvert v. Transcontinental Gas Pipeline Corporation, Tex.Civ.App., 341 S.W.2d 679, writ refused, this Court speaking-through Justice Hughes struck down a “Severance Beneficiary Tax.” Again the identical fact situation of the Michigan-Wisconin Phillips gas purchase was described, as there Michigan Wisconsin was a “severance beneficiary” just as here. This Act attempted to impose the tax as one on production or severance of the gas in place in that those persons who exercise the privilege of obtaining the production of dedicated gas pursuant to dedication contracts with producers had a sufficient interest in the production of such gas to justify the imposition of the tax upon them. This-Court affirmed the judgment of the Trial Court that the tax created a burden on interstate commerce.

The State contends that the tax before us is nothing more than an additional production tax laid on those having a direct and beneficial interest in the production of natural gas. Further that the operating incidence of the tax is different from that in the gas gathering tax and the severance beneficiary tax, both of which were held invalid in the cases cited above. That the incidence of the tax in the present case is-the production of gas which is purely a local activity.

With reference to residue gas (as purchased by Michigan-Wisconsin from Phillips in the example cited above) the State points out that Article 3.11, Sec. (2) (e), par. I, subd. A., under the heading “Meaning of Residue Gas” states that the tax is-applicable “at the time when it, along with the associated gasoline or other liquefiable hydrocarbons, is actually severed from the earth and waters of this State.” Article 3.11, Section (3), under the tax levied refers to the rate of one cent (1‡) per thousand (1,000) cubic feet of “residue gas produced” which rate is applied “at the time the said gas is severed.”

It will also be noted that Section (2) (e), subsection II, of the Act calls for residue gas to be measured at the outlet of a gasoline plant after liquefiable hydrocarbons have been removed. An example of such measurement and purchase is outlined in the Michigan-Wisconsin-Phillips factual situation described above. This measurement section of the Act further provides that residue gas that does not pass through a plant shall be measured after passing through a separator or a drip or a meter.

Irrespective of what the Act labels the tax and of what other declarations are found in the Act that seek to attach the tax to the production or production and processing of natural gas, in the Michigan-Wisconsin example cited above, it is apparent, as the U. S. Supreme Court found in the Michigan-Wisconsin Pipe Line Case cited above, that the tax attaches to the gas after it has been produced and processed and has been purchased and has begun its journey in interstate commerce. See Currin v. Wallace, 306 U.S. 1, 59 S.Ct. 379, 83 L.Ed. 441.

Where a tax is a burden on interstate commerce it is not made valid by isolating and denominating some incident or element as a “local activity” transpiring wholly within the state and designating such incident or element as the focal point of the tax. In this connection see Nippert v. Richmond, 327 U.S. 416, 66 S.Ct. 586, 90 L.Ed. 760.

In the recent case of Northern Natural Gas Company v. State Corporation Commission of Kansas, 372 U.S. 84, 83 S.Ct. 646, 9 L.Ed.2d 601 (1963) the Supreme Court of the United States struck down an order of the State of Kansas seeking to regulate Northern Natural as a producer of gas. The Court held that “production and gathering” are terms narrowly confined to the physical acts of drawing the gas from the earth and preparing it for the first stages of distribution. The Court further held that Northern Natural was not a producer but a purchaser of gas from producers.

We hold that appellee Michigan Wisconsin Pipeline Company in its operation within the State of Texas as shown above is not a producer of gas but a purchaser of gas.

The State relies on the case of State of Alaska v. Arctic Maid, 366 U.S. 199, 81 S.Ct. 929, 6 L.Ed.2d 227, where the Supreme Court of the U. S. upheld a tax imposed by Alaska on the value of fish caught and brought by small boats to a freezer ship anchored both outside and within the territorial waters of Alaska. The Court held that the freezer ships were liable for the tax, that the tax was not on interstate commerce, that the taxable event was prosecuting the business of freezer ships even though the tax was computed on the value of the fish brought.

The Arctic Maid case is not in point here. It is merely a recent extension of the many “production tax” cases which hold that the producing of goods by manufacturing, mining, drilling or similar methods is a local activity which may be taxed by the State, even though the goods are destined for interstate commerce. This line of cases holds that where goods are produced and prepared for interstate commerce, the State has a taxable interest. Here the privilege taxed is exercised before interstate commerce begins. See Oliver Iron Mining Co. v. Lord, 262 U.S. 172, 43 S.Ct. 526, 67 L.Ed. 929. These cases stand on footing different from those in which local regulations of the business of purchasing a commodity within and shipping it without the State have been deemed to impede or embarrass interstate commerce in those commodities. Dahnke-Walker Milling Co. v. Bondurant, 257 U.S. 282, 42 S.Ct. 106, 66 L.Ed. 239.

We also overrule the State’s contention that appellees may be classified as producers for the purpose of taxation under the doctrine announced by the Court in Barwise v. Sheppard, 299 U.S. 33, 57 S.Ct. 70, 81 L.Ed. 23. This case holds that the parties to a mineral lease are engaged in a common venture for their mutual benefit. We cannot equate this holding with the State’s contention that a dedicated reserve contract creates just as substantial a common venture between the dedicated reserve producer and the producer as an oil and gas lease creates between a royalty owner and a lessee. A purchaser through dedicated reserve contracts and the gas producer deal with each other at arms length. Instead of sharing in the proceeds derived from the production and sale of gas, the pipeline purchaser provides such proceeds and the lessor-lessee sellers receive and share them.

The judgment of the Trial Court is affirmed.

Affirmed.

HUGHES, J., disqualified and not sitting.

      . The Federal Constitution provides that Congress shall have the power “[t]o regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes.” Section 8 of Article 1, Cl. 3.

      . In cause No. 11,119 the five appellees are Panhandle Eastern Pipeline Company, Transcontinental Gas Pipeline Corporation, Michigan Wisconsin Pipe Line Company, Natural Gas Pipeline Company of America, and Northern Natural Gas Company. In cause No. 11,118, the ap-pellee is Tennessee Gas Transmission Co.

      . Art. 3.11, Title 122A, Vernon’s Ann. Revised Civil Statutes of the State of Texas is hereafter set out, in part, for reference:
      “(1) Declaration of Policy.
      “It is the policy of this State to obtain, as near as may be consistent with a fair and equitable tax policy, a tax return to the State of not less than one cent (l(í) per MFC on each MCF of natural gas produced and saved from the earth and waters of this State. The same is deemed necessary:
      “I. to derive a reasonable State revenue from the trillions of cubic feet of gas removed from the earth and waters of the State each year, and “II. to tax equitably all of those persons integrally engaged in the occupation of removing such gas, so that one associated group of them will not derive a windfall by virtue of a very small tax burden on each thousand cubic feet of gas produced by such others.
      “It is further the policy of this State, in order to promote conservation and to distribute equitably the burden of natural resources taxation, to recognize and clarify fully by statute the relation between various persons engaged in the occupation of producing natural gas so that the taxpayer in each instance may be identified clearly, and so that all persons so engaged in the occupation of production will bear equitaby the taxes imposed in connection with the severance of gas from Texas soil.
      “Pursuant to this policy it is recognized that contractual relations exist in such natural gas production occupation between several definable groups, all engaged integrally in such occupation of severance of natural gas from the soil and all having such a direct and beneficial interest in the production of gas that for the purpose of taxation they may be classified as producers of gas. It is the policy of the State of Texas to recognize that all such persons, integrally engaged in the occupation of severance of natural gas from the soil-producers, severance producers and dedicated reserve producers, have a taxable interest in production of gas in Texas.
      “(2) Definitions.
      “The definitions contained in Article 3.04, insofar as applicable, shall govern the meanings of the terms used in this Article. In addition, the following definitions are specifically applicable to this Article:
      “(a) ‘Severance producer’ means any person owning, controlling, managing or leasing any gas well and/or any person who produces in any manner any gas by taking it from the earth or waters of this State, and shall include any person owning any royalty or other interest in gas or its value, whether produced by him, or by some other person in his behalf, either by lease or contract or otherwise, when such person producing gas is in contractual relation with the dedicated reserve producer (either directly, or, if a royalty or other holder of an interest in gas in place and thereby entitled to a fractional share of the value of such gas in place, indirectly through the producer) .
      “(b) ‘Dedicated reserve producer’ means any person holding a written eontraet for a designated term specified therein which confers upon such person the right to take title to gas from particular lands, leases and reservoirs in this State and imposes upon a severance producer the duty to supply all or a designated quantity or portion of gas produced by that severance producer (or by that severance producer in conjunction with other severance producers) to the dedicated reserve producer at a fixed or determinable price.
      “(e) ‘Severance beneficiary’ has the following meaning:
      “I. In the case where there is in effect a dedicated reserve contract as to the gas in question, the term ‘severance beneficiary’ refers to the dedicated reserve producer.
      “II. In the case where there is no dedicated reserve contract in effect as to the gas in question, the term ‘severance beneficiary’ refers to the producer.
      “(d) ‘Dedicated reserve contract’ means any written contract for a designated term specified therein which confers upon a dedicated reserve producer the right to take title to gas from particular lands, leases and reservoirs in this State, and imposes upon a severance producer the duty to supply all or a designated quantity or portion of gas produced by that severance producer (or by that severance producer in conjunction with others) to the dedicated reserve producer at a fixed or determinable price.
      “(e) I. Meaning of Residue Gas.
      “A. As to gas from which liquefiable hydrocarbons are removed, ‘residue gas’ means that constituent part of the whole quantity of gas removed from the earth and waters of this State which eventually constitutes the residue. The tax is applicable under the terms of this Article to such constituent part of the whole quantity of gas at the time when it, along with the associated gasoline or other liquefiable hydrocarbons, is actually severed from the earth and waters of this State.
      “B. As to gas from which liquefiable hydrocarbons are not removed, ‘residue gas’ means the entire quantity except that gas which is:
      “ (i) injected into the earth, unless sold for such purpose;
      “(ii) produced from oil wells with oil and lawfully vented or flared; or
      “(in) used for lifting oil, unless sold for such purpose.
      “II. How measured. Such residue gas shall be measured by determining that portion of gas containing gasoline or other liquefiable hydrocarbons (that are to be removed or extracted at a plant by scrubbing, absorption, compression, or any other process) which is left after the application of such process and which flows through the outlet of such plant. In the event that such gas is processed in more than one such plant, the residue gas content shall be measured as that portion of the gas which flows through the outlet of the first plant.
      “As to that gas which passes through a separator and which is not processed in a plant to remove or extract the gasoline or other liquefiable hydrocarbons, the residue gas content shall be measured as that portion of the gas remaining after its passage through such separator. In the event that such gas passes through more than one separator, the residue gas content shall be measured as that gas remaining after the passage through the first separator.
      “As to that gas which passes through a drip or trap and which does not pass through a separator and which is not processed in a plant to remove or extract gasoline or other liquefiable hydrocarbons, the residue gas contents shall be measured as that portion of the gas remaining after passage through such drip or trap. In the event that such gas passes through more than one drip or trap, then the residue gas content shall be measured as that portion of the gas remaining after its passage through the last drip or trap.
      “As to that gas which passes through a meter and which does not pass through a drip or trap and which does not pass through a separator and which is not processed in a plant to remove or extract the gasoline or other lique-fiable hydrocarbons, the residue gas content shall be measured as that portion of the gas remaining after it passes through such meter. In the event that such gas passes through more than one meter, then the residue gas content shall be measured as that gas which passes through the first meter. “(f) ‘MCF’ means thousand cubic feet. “(3) The Tax Herein levied.

        “(a) There is hereby levied, in addition to all other occupation taxes on the occupation of producing gas in Texas, an occupation tax on the business or occupation of producing gas within this State as a severance beneficiary at the rate of one cent (3.0) per thousand cubic feet of residue gas produced, applicable at the time the said gas is severed from the earth or waters of this State, less the amount of tax paid per MOB1 under the provisions of Article 3.01 of this Chapter, computed in the following manner:
      “In the case of all gas subject to the tax imposed by Article 3.01 there shall be ascertained the amount of tax in cents and fractions of a cent per thousand cubic feet paid to the State with respect to each quantity of such gas by virtue of the seven per cent (7%) of value tax provided in that Article. If such amount is less than one cent (3.0) per MCB\ then there shall be determined the difference be-between such amount and one cent (3.0) per MOP. Such amount multiplied by-the quantity of the residue gas in question shall constitute the tax obligation, of the severance beneficiary of such, residue gas.”

      . Art. 3.01, Vernon’s AnnJtev.Civ.St. is a production tax on natural gas that was first enacted in 1931 and is presently in effect. Section (3) (a) of the tax presently before this Court provides that the tax paid under Art. 3.01 is to be deducted from any tax due under it.


author: COLLINGS, Justice.

text:
    Ginger Ann PORTER, Appellant, v. Knox PORTER et al., Appellees.
    No. 3829.
    Court of Civil Appeals of Texas. Eastland.
    Oct. 11, 1963.
    Rehearing Denied Nov. 1, 1963.
    Ponder & Pearson, James Pearson, Sweetwater, for appellant.
    Mays, Leonard, Moore & Dickson, R. Temple Dickson, Sweetwater, for appellees.
   COLLINGS, Justice.

Ginger Ann Porter brought this suit in the nature of a habeas corpus proceeding against Royce Donald Porter, seeking the custody of their 2½ year old son. Knox Porter and wife, the paternal grandparents, were also named as defendants. The case was tried before the court without a jury which rendered judgment denying custody of the child to both plaintiff and defendant, Royce Donald Porter and awarded custody to the paternal grandparents, who are residents of Nolan County. Ginger Ann Porter has appealed.

The record shows that appellant, Ginger Ann Porter was born, raised and was married to Royce Donald Porter in the State of California; that the minor child involved was also born in the State of California on July 15th, 1960; that while appellant and her husband were living together in Hayward, California differences arose between them and on August 20, 1962, appellant, without any notice, left her husband, took her child and moved to Reno, Nevada. Shortly thereafter her husband came to Reno to visit the child and, without the knowledge and consent of appellant, tosk the child with him to the home of his parents, appellees herein, in Sweetwater, Texas. Appellant came to Sweetwater but her husband and appellees denied appellant’s request for the return of her child. Appellant thereupon returned to Reno, Nevada, and on November 2, 1962, obtained a divorce from her husband. On November 8, 1962, she filed this child custody proceeding in the District Court of Nolan County, where the child was located, alleging that she was the mother of the child and a fit and proper person to have its custody. Ap-pellees, Knox Porter and wife and their son, Royce Donald Porter, the father of the child, answered by a general denial and further alleged that Ginger Ann Porter was not a fit and proper person to have the custody of her child; that the best interest of the child would be served by awarding its custody to its father, Royce Donald Porter, and prayed that such custody should be .awarded to the father. Appellees, the paternal grandparents did not seek or pray for ■custody of the child.

Appellant urges points contending that the court erred (1) in failing to award the custody of the minor child to her, the natural mother; (2) erred in awarding the custody of such child to appellees, the paternal grandparents, because such award is against the great weight and preponderance of the evidence; (3) erred in finding that appellant is not a fit and proper person to have custody of her said minor child, because there is no evidence to support such finding, or in the alternative (4) because the evidence is insufficient to support such finding; and (5) because such finding is against the great weight and preponderance of the evidence.

District Courts have broad power in determining the matter of custody of minor children which will not be disturbed except in a case of clear abuse. Wade v. Shaughnessy, Tex.Civ.App., 231 S.W.2d 494, (Writ Ref.); Valentine v. Valentine, Tex.Civ.App., 203 S.W.2d 693. The basis for determination of the matter of child custody must be the best interest of the child. 15B Texas Jurisprudence, 59, 60. It is presumed that the welfare of a child will be best served by being in the custody of a parent rather than some other person. Kollenborn v. Kollenborn, Tex.Civ.App., 273 S.W.2d 660; Dunn v. Dunn, Tex.Civ.App., 217 S.W.2d 124. However, a trial court does not abuse its discretion in awarding the custody of a child to grandparents or some other fit and proper person if it is shown that the parents are not fit and proper persons. Taylor v. Meek, 154 Tex. 305, 276 S.W.2d 787; Clark v. Spradlin, Tex.Civ.App., 301 S.W.2d 216; Prock v. Morgan, Tex.Civ.App., 291 S.W.2d 489.

In the instant case the court found that appellant, the mother of the minor child involved, is not a fit and proper person to have his custody; that she is not presently able to provide a fit and proper home for her son; that the environment of the child would be improper and unwholesome if his custody is now awarded to his mother; that the mother is a non-resident of the State, and if the child should be awarded to her, she would immediately leave the State and take the child with her. The court found that it would be to the best interest of the child that his care, custody and control be awarded to his grandparents, Knox Porter and wife, Rubye Porter, who are residents of Nolan County, Texas, and in whose home the father, Royce Porter, now resides. The court found that Knox Porter and Rubye Porter are fit and proper persons to have the custody of the minor child; that their home is a fit and proper one for rearing the child; that the environment, home life and surroundings of the minor child will be more stable at the home of appellees Knox and Rubye Porter and that thereby said minor child will be assured of better care and better atmosphere in general for his mental, moral and emotional development.

We have carefully considered the evidence and have come to the conclusion that the court did not err in finding that appellant is not a fit and proper person to have the custody of her minor child, and that it would be to the best interest of the child to be in the custody and care of ap-pellees Knox Porter and wife. The effect of the evidence is that appellant has over a period of years been guilty of periodic, but a more or less regular, series of serious indiscretions and inexcusable misconduct entirely inconsistent with a proper environment for children. The evidence does indicate that appellant at times has conducted herself as a proper parent showing that she loves her child. Her conduct and attitude on the whole, however, has been such that it constitutes not only some evidence but amply sufficient evidence to support the finding of the court that she is not a fit and proper person for child custody. The evidence further shows that appellant is a non-resident of this State and if granted custody of her child, plans to make her home in Reno, Nevada. The evidence concerning the home which she plans and its surroundings indicate that the child would be subjected to an improper and unwholesome environment. The trial court did not abuse its discretion in awarding the custody of the minor child in question to appellees, Knox Porter and wife. Appellant’s points are overruled.

The judgment is affirmed.


author: WILSON, Justice.

text:
    WHITE SANDS DEVELOPERS, INC., Appellant, v. T. R. FEHRENBACH, Trustee, et al., Appellees.
    No. 4168.
    Court of Civil Appeals of Texas. Waco.
    Oct. 17, 1963.
    Rehearing Denied Oct. 31,1963.

      Orrin W. Johnson, Harlingen, for appellant.
    Garcia & Warburton, Brownsville, for appellees.
   WILSON, Justice.

Construction of the rent-abatement provision in a lease, and a declaration that lessee-plaintiff had overpaid rental by approximately $2,000.00 were sought in this declaratory judgment action. Summary judgment based on pleadings and affidavits was rendered to the effect that lessee had made a $60.00 overpayment for a four-day period, and lessee appeals.

Appellee-lessor leased a tract on Padre Island to appellant for a 53-year term from December, 1957, upon which lessee erected a resort hotel. The lease provided for a minimum monthly rental of $450.00, or 5% of lessee’s gross receipts, whichever was largest. During all of the period in question the $450.00 minimum rental exceeded 5% of gross receipts.

The lease recited that the land was subject to action of the sea and tides, and provided that lessee “accepts the same subject to all such hazards”; and that since the causeway connecting the island to the mainland and the boulevard on the island afforded the only feasible means of access, and since the leased premises were usable by lessee “only so long as such means of access are usable”, in the event they were destroyed, damaged, inundated or otherwise rendered unusable by hurricane or other natural disaster, (but were nevertheless to be restored), the lease should not terminate,

“but during such period of time as the causeway, its approaches, or road are not usable the rent hereinabove provided for shall abate entirely * * except that if the Lessee should operate on a reduced' scale during such period of time, the minimum rent herein-above provided for shall remain abated, but the Lessee shall pay the percentage rental while such limited operation shall continue, and the minimum rental shall remain so abated until the Lessee’s operations shall produce receipts in such amount that the percentage rental equals or exceeds the minimum monthly payment for the period involved * * *.”

On September 9, 1961 Hurricane “Carla” caused the island to be inundated and officials restricted traffic on the causeway and road to persons having personal business or interests on the island. The hotel was vacated on September IQ, all guests having left the previous night. September 12th the secretary of lessee corporation and his wife returned to the hotel, although sea water still covered the road and prohibition of general public admission to the island continued. The secretary and his wife then began cleaning up,’ operated the telephone switchboard and made room reservations. The causeway approaches and road were damaged, inundated and unusable for four days from September 9th through September 12th, when repairs were completed and normal traffic resumed. The $450.00 monthly minimum rental continued to exceed 5% of lessee’s gross receipts until April, 1962.

Lessee’s position is that since the minimum rent abated from September 9th through September 12th while the causeway approaches and road were unusable; since the motel was operated on a reduced scale during such period; and since the lease provided the minimum rent should remain so abated until ’ the percentage of gross receipts equalled the $450.00 minimum,' it did not owe any rent until April, 1962. It says the lease should be construed to mean the minimum rent continued abated “until the date the minimum rent and percentage rent coincided.”

The provision in question is dearly related and restricted under the language we have italicized to the time during which the $450.00 minimum monthly rental is to remain abated: “during such time as the causeway, its approaches, or road are not usable.” If it be said, as lessee contends, that it operated the hotel “on a reduced scale”, such operation is likewise referable, related and limited to “such period of time” as the causeway, approaches and road were unusable. Affirmed.