author: NORTHCUTT, Justice.

text:
    Jack FROST, Appellant, v. George C. WELLS, Appellee.
    No. 7443.
    Court of Civil Appeals of Texas. Amarillo.
    Feb. 22, 1965.
    Rehearing Denied March 22, 1965.
    Trueheart, McMillan & Russell, San Antonio, George H. Hansard, Lamesa, for appellant.
    Mitchell Williams, Tahoka, Cayton & Gresham, Lamesa, for appellee.
   NORTHCUTT, Justice.

This is an appeal by Jack Frost, individually and operating under the trade name of Jack Frost Ranches, as appellant, from a judgment overruling his plea of privilege to be sued in the county of his residence, Bexar County, Texas. The exceptions to exclusive venue in the county of the defendant’s residence that are invoked by the controverting plea of appellee, George C. Wells, are exceptions 10 and 13 of Article 1995, which were claimed by said plaintiff to give venue to the district court of Lynn County, Texas. The trial court heard the evidence on March 21, 1964, and then took the case under advisement on briefs of both parties rendering judgment on June 8, 1964, denying appellant’s plea of privilege. From that judgment appellant perfected this appeal.

The first two points of error presented by the appellant are as follows :■

FIRST POINT
“The trial court erred in overruling and in not sustaining appellant’s plea of privilege, for the reason that when the ‘Contract of Employment’, which is attached to plaintiff’s petition ‘and made a part hereof for all purposes’, is given its proper controlling effect, the nature of the suit as so determined is not one for the recovery of personal property, within exception 10 of Art. 1995, nor one for the partition of such property, within exception 13 of Art. 1995, but is one for simple debt or else for an accounting.”
SECOND POINT
“The trial court erred in overruling and in not sustaining appellant’s plea of privilege, for the reason that paragraph 5 of the ‘Contract of Employment’, which paragraph is invoked in the controverting plea as showing a joint ownership between appellee and appellant, and paragraph 8 thereof, which is invoked by appellee as showing the right to division of property in kind, are both expressly conditioned upon reimbursement of appellant for all expenses and for the value of the base herd ($306,350.00), and it is not alleged in the petition nor the controverting' plea that this condition of reimbursement has been satisfied, and it affirmatively appears from the undisputed evidence that it has not been satisfied.”

On January 1, 1958, Jack Frost and George C. Wells made and entered into a written contract whereby Frost employed Wells as manager of Frost’s Ranch Operations. The contract was signed and acknowledged on July 12, 1961. Since this is such a peculiar contract, we set the same out in full as to all of its terms as follows:

“Jack Frost is the owner of various ranches in Texas on which ranches he had cattle, which cattle as of the 1st day of January, 1958, had a value of $306,-350.00; and
“WHEREAS, Jack Frost is desirous of employing George C. Wells as Manager of all of his various ranching operations, and George C. Wells is desirous of accepting such employment.
“NOW THEREFORE, Jack Frost employs George C. Wells as Manager of his ranching operations upon the following terms and conditions:
“1. The Manager shall well and faithfully serve the employer in such capacity and shall at all times devote his whole time, attention and energies to the management, superintendence and improvement of the said ranching business, doeing and performing all such services and acts connected therewith, and properly belonging to the duties of a manager, which the employer may from time to time direct. Such services, attentions and acts shall be performed by the manager to the utmost of his ability.
“2. The books of the ranching operation shall be maintained at employer’s office and manager shall furnish all necessary information to employer’s bookkeeper so that accurate records may be maintained.
“3. This contract shall remain in full force and effect until terminated by the parties, the right being reserved by either party to terminate the same upon sixty (60) days written notice mailed by registered mail to the last known address of the other party. In case of the death of the employer this contract shall remain in full force and effect until terminated under the above provision by the proper representative of the estate of the deceased, or until terminated by the manager.
“4. Employer shall pay to the manager a salary of $1,000.00 per month. Said salary to begin as of the 1st day of January, 1961. Employer shall further reimburse manager for all necessary expenses expended by manager in furtherance of the operations of the ranching business.
“5. All income from the operation of the ranches shall be applied first to the liquidation of the expenses accruing, including the manager’s salary, and after all expenses, including, but not limited to, rents, salaries, taxes, etc., have been reimbursed to employer, then the net income thereafter shall be divided equally between the employer and the manager. All major items purchased and charged as expense shall belong equally to employer and manager. Permanent improvements to employer’s ranches shall not be charged as expenses and shall belong to employer. It being understood that no division shall be made until employer shall have been reimbursed for all expenses and salary from the beginning of the contract to the date of distribution of profits.
“6. Employer reserves the right to buy and sell ranches, or lease extra and additional land.
“7. All monies received shall be deposited to the credit of employer in bank or banks designated by him. The manager shall not draw, accept, or make any bill of exchange or promissory note on the behalf of the employer, or otherwise pledge his credit, except so far as he may have been thereto authorized by the employer.
“8. Upon termination of this contract employer shall first be reimbursed for his base herd in the sum of $306,-350.00, as above set out, less the depreciation thereof, which depreciation shall be based on the rate of 8% per year from January 1, 1958. Secondly, Employer shall be reimbursed for all unpaid expenses. Should there not be sufficient money to pay these expenses then sufficient livestock shall be sold to reimburse employer, and employer or manager shall be entitled to purchase the livestock at the prevailing market price. The balance of the herd and major items which have been charged as expense shall then be divided equally between employer and employee.
“9. Employee agrees upon termination of this contract to remove his portion of the herd and property from the lands owned or leased by employer within a period of 60 days.”

The contract of employment was terminated effective as of September 1, 1963. Wells first pleaded they entered into a contract of employment and then later in his petition pleads it was a partnership and seeks to hold venue in Lynn County under Sections 10 and 13, Article 1995 as owner of a portion of the cattle as a partner. Section 10 provides that a suit for the recovery of personal property may be brought in any county where the property may be or where the defendant resides. Section 13 provides suit for partition of land or other property may be brought in the county where such lands or other property or a part thereof may be.

Since Wells attached a copy of the contract to his petition and made it a part thereof, we think the contract takes precedence over the allegations of the petition and we must look to the contract as determining the matters here. Paul v. Houston Oil Co. of Texas, 211 S.W.2d 345 (N.R.E.); Cawley v. Security State Bank & Trust Co., Tex.Civ.App., 126 S.W.2d 715. The real question to he determined is whether this is really a suit for an accounting or a partition of personal property or to recover personal property.

We are familiar with the distinction between a trial upon a plea of privilege and a trial upon the merits of a case. The sole matter to be determined upon a hearing on a plea of privilege is to determine whether the defendant is suable on the transaction involved in the county where the plaintiff files his suit. Compton v. Elliott, Tex.Com.App., 126 Tex. 232, 88 S.W.2d 91 and cases there cited.

Under the above mentioned contract we do not believe there was any partnership created nor a joint adventure and we hold as a matter of law under the contract it was purely a contract of employment and any interest that Wells might ever have in the cattle would be a part of his compensation as an employee. Wells did not plead that any of the terms required under the contract had been complied with authorizing him to acquire any interest in-any of the cattle. Under the terms of the contract no division was to be had until the employer, Frost, was reimbursed for all expenses and salary from the beginning of the contract to the date of distribution of profits and neither did Wells allege Frost had been paid for his base herd in the sum of $306,-350.00, less the depreciation. All of these matters had to be complied with before any division was to be had.

It is stated in McCord v. Ft. Worth National Bank, Tex.Civ.App., 275 S.W.2d 717 (N.R.E.), as follows:

a * * * it seems clear to us that McCord was neither made a partner of Cauker nor a joint adventurer with him under this, contract. * * * McCord did not have the right to dispose of any interest therein as an owner of an interest. He did not have the right to share in the profits of Cauker as a principal. Therefore, under the established rules of law in Texas he would be neither a partner nor a joint adventurer. * * * We believe that Mc-Cord had only a contractual right to have his compensation based upon a computation of the profits and, as thus computed, paid over to him when it was earned, and his interest in such profits was common to Cauker’s only because the profits were to serve as a measure of the compensation he would receive for his services. * * * No part of the profits would be property of McCord held by Cauker as his agent. But such profits would merely constitute a yardstick or measure whereby the amount of compensation due him from Cauker would be computed. So, if indeed Cauker did not pay McCord all that he should have paid him under the contract, McCord’s claim against him would be a personal claim, identical to a claim for simple debt founded on written contract.”

It is stated in Le Bus v. Le Bus, 269 S.W.2d 506, Tex.Civ.App. (N.R.E.) as follows:

“In order for there to be a partnership the parties must not only participate in the profits but they must have an interest in the profits, as profits, and share them as joint owners or principals of the business or venture, as distinguished from an interest therein as compensation under a profit sharing agreement. Tanner v. Drake, Tex.Civ.App., Eastland, 1932, 47 S.W.2d 452, affirmed in Tex.Com.App. 1935, 124 Tex. 395, 78 S.W.2d 162; Mangum v. Turner, Tex.Civ.App., Amarillo, 1940, 142 S.W.2d 951, error dismissed; Pyron v. Brownfield, Tex.Civ.App., Amarillo, 1922, 238 S.W. 725; Buzard v. Bank of Greenville, Sup.Ct.1886, 67 Tex. 83, 2 S.W. 54, 60 Am.Rep. 7; Storey on Partnership, sec. 33, et seq.; Rowley on Modern Law of Partnership, p. 65, sec. 69, et seq.; 47 C.J., p. 669, sec. 62; 68 C.J.S., Partnership, § 17, p. 428; 32 Tex.Jur., p. 228, sec. 8, and p. 240, sec. 18.”

Wells, being an employee and not a partner and there being no pleadings to show Frost had been paid as provided for in the contract before Wells would be entitled to any interest in the cattle or right of possession, we are unable to see where he would be entitled to possession of any of the property in question at the time he filed his suit. Consequently, venue could not be sustained in Lynn County under exception 13, Article 1995. It is stated in Collins v. Naylor, Tex.Civ.App., 192 S.W.2d 332 as follows:

“The last cited case was one for partition of land; an action brought by one who had an interest therein but was not entitled to possession, and it was held that since plaintiff was not entitled to possession, the action for partition could not be maintained. The same rule is announced in Medina Oil Development Co. v. Murphy, Tex.Civ.App., 233 S.W. 333, writ dismissed. It must be conceded that plaintiff (appel-lee) was not entitled to possession of any of the assets of the partnership at the time she instituted this suit. We therefore conclude that venue in Tar-rant County cannot be sustained under exception 13 to Article 1995.”

See also the case of Miller v. Howell, Tex.Civ.App., 234 S.W.2d 925 at 929, where it is stated:

“Plaintiffs say that their suit is one to recover land, and to partition land, and to foreclose a lien on land, a part of which land lies in Wood County. Their pleadings may contain conclusions to such effect, if the conclusions are read without regard to the remaining allegations in the pleadings, but when the pleadings are examined in their entirety, and when it is endeavored to find out what principal right or rights are asserted and what relief is sought, it is seen that the suit falls within a well-defined category. It is, by all standards, an equitable proceeding for a partnership accounting. It is a transitory action, rather than a local one, it is primarily a proceeding in per-sonam, rather than a proceeding in rem.”

Wells under his pleadings herein seeks to recover as a partner asking that a receiver be appointed with power to sell and pay all debts of the partnership. We must look to the contract as it is made a part of the pleadings and takes precedence over the allegations of the petition and appellant may not recover as a partner.

The contract in question provided no division should be made until the employer had been reimbursed for all expenses and salary. The expenses were all expenses (emphasis ours) including but not limited to rents, salaries, taxes, etc. The contract further provided that upon termination of the contract the employer shall first (emphasis ours) be reimbursed for his base herd in the sum of $306,350.00, less the depreciation thereof based on the rate of 8% per year from January 1, 1958. We construe those provisions as a promise upon the part of Frost to do certain things when Wells did a certain thing and was not enforceable until Wells complied with those conditions. It is stated in Gulf Pipe Line Co. v. Nearen, 135 Tex. 50, 138 S.W.2d 1065, as follows:

“It has been ruled in this state that where a promise is conditioned upon the happening of a future event as a rule a condition precedent must be exactly performed or fulfilled before the promise can be enforced. Reagan v. Bruff, 49 Tex.Civ.App. 226, 108 S.W. 185; Cooksey v. Jordan, Tex.Civ.App., 140 S.W. 1175. It was decided that ‘It is quite elementary that an instrument payable upon a condition which does not import an absolute liability is not payable until that condition has happened.’ Ferguson v. Mansfield, 114 Tex. 112, 263 S.W. 894, 900. It is also elementary that a party to a contract who is himself in default cannot maintain a suit for its breach. Smith v. Fort, Tex.Civ.App., 58 S.W.2d 1080.”

Wells does not plead any compliance with the terms of the contract authorizing him to have any interest in the cattle but seeks to have an interest by pleading a partnership contrary to the employment contract. We do not believe he has brought this case within exceptions 10 or 13 of Article 1995 as to defeat Frost’s rights to be sued in the county of his residence as laid down by the Supreme Court in A. H. Belo Corporation v. Blanton, 133 Tex. 391, 129 S.W.2d 619, where it is stated :

“The dominant purpose of our venue statutes is to give a person who has been sued the right to defend such suit in the county of his residence, except under. well-defined exceptions. This rule was declared in the case of Pool v. Pickett, 8 Tex. 122, and has been consistently followed since that time.
“To deprive a defendant of the right of trial in the county of his domicile, the case filed against him must clearly come within one of the exceptions found in this statute, and the burden rests upon the plaintiff to allege and prove that the case comes within the exception. Meredith v. McClendon, 130 Tex. 527, 111 S.W.2d 1062; Coalson v. Holmes, 111 Tex. 502, 240 S.W. 896; Lasater v. Waits, 95 Tex. 553, 68 S.W. 500; Compton v. Elliott, 126 Tex. 232, 88 S.W.2d 91.”

We sustain appellant’s first two assignments of error. Since we are of the opinion that the sustaining of appellant’s first and second assignments of error requires reversal of the case, we will not discuss the remaining assignments of error.

Judgment of the trial court is reversed and the case ordered transferred to a district court in Bexar County, Texas.


source: Caselaw Access Project

author: MASSEY, Chief Justice.

license: Public Domain

text:
    B. R. BOGGUS, Appellant, v. Lawrence J. MILLER et ux., Appellees.
    No. 16608.
    Court of Civil Appeals of Texas. Fort Worth.
    Feb. 26, 1965.
    Rehearing Denied March 26, 1965.

      Mullinax, Wells, Morris & Mauzy, and Otto B. Mullinax, Dallas, for appellant.
    Cantey, Hanger, Gooch, Cravens & Scarborough, and William B. David, Fort Worth, for appellees.
   MASSEY, Chief Justice.

The disputejbetween the parties grew out of an automobile collision. Plaintiff B. R. Boggus sued the defendants, Mrs. Lawrence J. Miller and her husband, for damages on account of personal injuries and property damage. Not only did the jury fail and refuse to find the defendants guilty of negligence amounting to a proximate cause of the collision, but the jury found that plaintiff was guilty of contributory negligence. The jury not only refused to find that plaintiff sustained any injury as (direct and) proximate result of the collision, but also found that “none” was the sum of money which would reasonably compensate plaintiff for injuries, if any, which he sustained. Answers established that as result of the collision a $100.00 depreciation in the market value of plaintiff’s automobile was sustained after he necessarily incurred expenses of $207.55 as the reasonable cost of repairing the damage thereto.

Judgment was rendered for the defendants. Plaintiff appealed.

The plaintiff does not present any point of error which complains because of the findings relating to damages. Neither does any point relate to error which would have had an effect upon proof, or absence of proof, concerning damages. The peculiar situation resulting is that should we conclude that our proper judgment would be to reverse and render the judgment appealed from we would award plaintiff only such damages as the answers of the jury support. Obviously, plaintiff does not desire such a rendition. His prayer is for a remand.

The collision was of the simpler sort. At night, on a paved highway bearing painted lines for the travel of vehicular traffic in two lanes going east and two lanes going west, the direction of travel for the two automobiles involved was in opposing directions. In other words they were approaching one another. The defendants’ automobile was directed into a left-hand turn, across the lane in which the plaintiff’s vehicle was being driven, and the right portion of the front end of the plaintiff’s vehicle struck into the right rear portion of the defendants’. The only condition varying the form of collision from that with which persons are generally familiar was the presence of two “yellow stripes” in the middle of the highway, denoting that a motorist should not drive to his left so that his vehicle would cross said stripes so long as they persisted in unbroken lines.

Vernon’s Ann.Tex.Civ.St., art. 6701d, the Uniform Act Regulating Traffic on Highways, at § 62, “Driving on divided highways”, contains a provision that every vehicle shall be driven only upon the right-hand roadway and not driven over, across, or within any dividing space except through an opening or space or at a crossover or intersection established by public authority whenever any highway has been divided into two roadways by leaving an intervening space or clearly indicated dividing section so constructed as to impede vehicular traffic. Mrs. Baird’s Bakeries, Inc. v. Roberts, 360 S.W.2d 850 (Eastland Civ.App., 1962, writ ref., n. r. e.), held that “solid yellow lines” in the center of a highway constitute such a dividing space as was described in § 62 of the Uniform Act. We agree.

The act of a motorist driving to the left across such lines or stripes constitutes negligence per se, obviating necessity to make inquiry of the jury upon the matter of negligence when the fact of the occurrence is indisputably established or found to have occurred by the jury in an antecedent issue. Ordinarily, there would be persistent a necessity for submission of a special issue inquiring whether the action amounted to a proximate cause of any collision. In the instant case necessity therefore was present under the evidence before us. The requirement of foreseeability in connection with proximate cause issues may not be disregarded. The trial court provided in his definition of “proximate cause” that “for an act or omission to become a proximate cause of an injury it must have been reasonably anticipated by a reasonably prudent person in the exercise of ordinary care, that such injury or some-similar injury would follow as a natural consequence.” There was no objection to the definition.

There was evidence from the defendant, Mary Miller, and from passengers in her automobile that each looked ahead for oncoming traffic before the automobile was turned and driven across the highway; that neither the plaintiff’s nor any other vehicle was observed; and (inferentially) that under the circumstances it appeared that Mrs. Miller’s act did not seem hazardous as of the time she acted.

The court therefore did not err in submitting the inquiry in Special Issue No. 1 as to whether “ * * * the act of defendant, Mary Miller, in driving her automobile across the double yellow stripe of West Division Street, was a proximate cause of the collision in question.”

The court did not err in refusing to submit an explanatory instruction in connection therewith in the words of § 62 of the Uniform Act Regulating Traffic on Highways. Such instruction would have no necessary relation to the issue on proximate cause, and, as already stated, there was no necessity to submit any issue on negligence. Furthermore, the absence of such instruction in no way operated preju-dicially.

The court did not err in refusing to submit to the jury the plaintiff’s specially requested issues. The first made inquiry as to whether from a preponderance of the evidence “Mary Miller’s failure to turn at a divided section instead of across the yellow stripe was negligence”, and the second made inquiry as to whether such negligence, if any, was a proximate cause of the collision. The court submitted the controlling issue relative to whether Mrs. Miller’s turning of the defendants’ automobile and driving it across onto the left-hand, to her, side of the highway amounted to a proximate cause of the collision. The court assumed Mrs. Miller to have been guilty of negligence. The inquiry posed by the specially requested issues constituted merely a varying phase or different shade of the negligence deemed established as a matter of law and of the factual issue submitted on the question of proximate cause. Texas Rules of Civil Procedure, rule 279, “Submission of Issues”, provides that there shall be no reversal of a judgment for the refusal of requested issues in such situations. See also excerpts from an address of Chief Justice Alexander in the “commentaries” following the Rule in Vernon’s Annotated Rules of Civil Procedure.

Not covered by what we have stated hereinabove is matter determinative of plaintiff’s remaining points of error. By most of said points complaint is made that there was no evidence supporting answers of the jury to special issues, both as applied to the defendant Mary Miller’s primary negligence and to the plaintiff’s contributory negligence, and also as applied to the jury’s finding or failure to find the presence of proximate cause in issues making inquiry thereupon. Alternative thereto, in most instances, was plaintiff’s complaint that the answers were against the great weight and preponderance of the evidence.

We have examined the evidence in light of the complaints made. We are satisfied that in each instance of complaint there was evidence of probative force and effect supporting the answers returned, and that in no instance was the jury finding against the great weight and preponderance of the evidence. As to the points of error complaining of want of evidence sufficient to support the submission of special issues which the trial court did submit, we are, of course, likewise satisfied that the evidence produced on trial was sufficient to raise the issues.

Complaint is presented of the form of contributory negligence issues relative to plaintiff’s failure to timely apply his brakes and failure to turn his automobile so as to avoid the collision. Under the factual condition existent we see no reversible error. Points raising the complaints are overruled.

In view of our conclusions to the contrary of plaintiff’s contention that there was any individual error, we also overrule plaintiff’s final point which' ksserts that the “accumulation of error” was such as deprived him of a fair trial.

Judgment is affirmed.


author: COLLINGS, Justice.

text:
    BILLY MITCHELL VILLAGE, INC., Appellant, v. NEW YORK LIFE INSURANCE COMPANY, Appellee.
    No. 3928.
    Court of Civil Appeals of Texas. Eastland.
    Feb. 26, 1965.
    Rehearing Denied March 19, 1965.

      Levey & Goldstein and Jay Sam Levey, San Antonio, for appellant.
    Clemens, Knight, Weiss & Spencer, George H. Spencer and Edward R. Finck, Jr., San Antonio, for appellee.
   COLLINGS, Justice.

Billy Mitchell Village, Inc., brought this suit against New York Life Insurance Company, a corporation, P. N. Brownstein, Commissioner of the Federal Housing Administration and Eugene M. Zuckert, Secretary of the Air Force, seeking a declaratory judgment determining whether a note executed by plaintiff was in default. Plaintiff also sought an injunction to restrain a foreclosure sale under a deed of trust to satisfy the indebtedness evidenced by such note, which plaintiff admitted having executed but alleged was not in default. The defendant New York Life Insurance Company filed a cross action against plaintiff, alleged that it was the owner of the note and sought to recover the balance due thereon and to foreclose its deed of trust. Plaintiff Billy Mitchell Village, Inc., filed an amended petition and in addition to the relief previously sought prayed for damages for an alleged conspiracy on the part of New York Life Insurance Company, the Federal Housing Commissioner and the Secretary of the Air Force, jointly and severally. The defendant New York Life Insurance Company filed a motion for summary judgment on its cross action, which was granted, and, on January 8, 1964, judgment was entered against plaintiff for the sum of $2,445,084.07, the amount found to be due on the note, for attorney’s fees and for foreclosure of the deed of trust lien. Thereafter on March 12, 1964, the court ordered that the cross action of defendant New York Life Insurance Company be severed from that portion of plaintiff’s suit seeking damages for alleged conspiracy on the part of the defendant insurance company and other named defendants, and ordered that the summary judgment an defendant’s cross action rendered on January 8, 1964, be made final. Plaintiff Billy Mitchell Village, Inc., has appealed.

The record shows that the note sued upon. was dated July 21, 1949, and in the original amount of $3,220,000.00; that by its terms the principal and interest thereon was payable in monthly installments beginning January 1; 1951 and ending July 1, 1983. The note provided that if any default in payment was not made good prior to the date of the next installment, said note at the option of the holder should become immediately due and payable without notice and that the lien securing same might be foreclosed. The note was secured by a deed of trust containing similar provisions as to acceleration without notice and provided further for the deposit of sums of money for mortgage insurance pursuant to the National Housing Act, taxes and insurance. It is undisputed, subject to qualifications as hereinafter indicated, that appellant defaulted on payments due on the note after May 20, 1963 and that the principal balance due on said note was the sum of $2,445,-084.07 with interest thereon at the rate of 4% per annum from May 1, 1963. The Federal Housing Administration insured the note upon which this suit is based and became the owner of all the first preferred stock of appellant.

The record shows that an amendment to appellant’s charter provides for a reserve fund for replacements to be created by additional payments in the amount of $1,-547.64 per month over the life of the mortgage to be deposited with the mortgagee. The charter amendment further provides that no disbursements from this fund may be made without the written consent of the Federal Housing Commissioner, the holder of the first preferred stock. It was established by affidavit that the Federal Housing Administration had not consented to any disbursement of said reserve fund to be applied to the principal and interest due and payable under the terms of the note upon which this suit was based.

Appellant asserts and shows that in addition to the payment of the principal and interest on said note and a reserve deposit for taxes and insurance that it has paid to appellee as a reserve for replacements under the charter provision in excess of $198,500.00 which sum is held by appellee but belongs to appellant and that appellee has invested part or all of said reserve fund or has used same for its own benefit over a period of years and has never made any accounting to appellant; that said reserve account was more than sufficient to take care of the claimed delinquent installments and that after applying said reserve to payments or installments then due there would still remain more than a reasonable amount to take care of replacements or repairs which might be needed for the property covered by the deed of trust. Appellant asserts that appellee has failed and refused to apply the amount of the reserve held by it to the payment of appellant’s note and that appellee claims it has no authority tc. use said reserve for that purpose; that the Commissioner of the Federal Housing Administration has claimed that he could not authorize the application of the reserve to the payment of said note unless requested to do so by appellee, and that if the consent of said Commissioner or the request of ap-pellee were required the Commissioner wrongfully withheld such permission and appellee wrongfully failed to make such request and that the withholding of such permission and request of said parties was part of a conspiracy to acquire appellant’s property for the United States without the payment of just compensation.

Appellant urges points contending that the court erred in granting appellee’s motion for a summary judgment; that it was the duty of the court to hear evidence, require an accounting by appellee and make a determination as to the amount owed by appellant before it ordered a foreclosure sale. Appellant contends that there was an issue of fact as to whether or not its note was in default; that appellant had set up a reserve account with appellee for replacements which had accumulated in excess of $198,500.00 at the time of the trial which was more than adequate to take care of all payments on the note then due and leave an amount sufficient to cover all necessary replacements; that the reserve account for replacements was not required by the terms of the deed of trust held by appellee, nor was there any other contract between appellant and appellee which required appellant to set up and maintain such a reserve account for the benefit of appellee; that such reserve account for replacements was required by appellant’s charter provision and was a matter wholly between the Federal Housing Association and appellant, and did not in any way affect the note or deed of trust in question. Appellant therefore contends that it was entitled to withdraw such reserve account funds in excess of that required for all necessary replacements, and to apply same to the payment of its note, and that the court erred in not so holding, and in granting appellee’s motion for summary judgment.

Appellant by its pleadings had admitted the execution and delivery of the note and deed of trust which is the basis of appellee’s cross action. Appellant also admits that such note and deed of trust have been duly transferred to appellee. Appellant’s pleadings also show the establishment of the “reserve for replacement account” provided for in appellant’s charter provision, that there was in excess of $198,500.0.0 in this account, and that appellant requested ap-pellee to apply part of such funds to the unpaid installments due on the note in question. Appellant’s pleadings also indicate that its housing units have been about one-third occupied, causing appellant to be unable to make the payments provided for in its note held by appellee New York Life Insurance Company.

Appellant filed one affidavit in opposition to appellee’s motion for summary judgment. This affidavit sets out that a request was made to appellee to apply the “replacement” reserve account of Billy Mitchell Village, Inc. on deposit with appellee New York Life Insurance Company to the note indebtedness of appellant and that appellee refused such request. The note held by appellee was thus admittedly in default unless appellant’s contention concerning the application of a portion of the “reserve for replacement account” is well taken. In this connection it is noted that there is an express provision in appellant’s charter that “Disbursements from such fund, whether for the purpose of effecting replacements of structural elements, furnishings and mechanical equipment of the project, or for any other purpose, may be made only after receiving the consent in writing of the holders of the ‘First Preferred’ stock.” It is undisputed that the Federal Housing Administration is the owner and holder of the “First Preferred stock” and that that agency has not, in writing or otherwise, consented to such an application of the reserve fund held by appellee as a replacement account. Appellant’s contention that there should be such an application of the reserve account to past due payments and that its note is therefore not in default is not well taken. United States of America v. Pine Hill Apartments, Inc., 5 Cir., 261 F.2d 667; United States of America v. Queen’s Court Apartments, Inc., 9 Cir., 296 F.2d 534. In both of the above cited cases there were charter provisions in the defendant’s corporation’s charter substantially the same as the charter provision here under consideration. In the last cited case it is stated in the court’s opinion as follows:

“We believe that the Pine Hill case supports the contention of appellant that it was not required to use the replacement fund to make up the payments which were delinquent upon the note, and that it was not required to credit the mortgagor with the funds in this reserve replacement fund prior to the time for determination of whether or not there was a delinquency after the foreclosure sale.
“We also agree with the second contention made by the government that the government had a right to hold these funds as a set-off against any possible amount due the government after a foreclosure sale. In fact, ap-pellee concedes that the government has a right of set-off, its contention being that the government has no right to choose the time at which it will apply *he funds in its hands as a set-off. We cannot agree with appellee’s contention in this regard. The payment of the funds in the replacement fund was a condition upon which the money was originally loaned. If the government was required to use these funds to wipe out any possible monthly delinquent payments as they became due, the replacement fund could be wiped out very quickly and any value that arises from requiring such a fund would be dissipated.
“We hold that the appellant was not required to return the funds held in the replacement fund prior to foreclosure and that the district court was in error in so conditioning its order of foreclosure. We disagree with appellee’s contention that equity required the payment of this fund to appellee prior to foreclosure. We see no inequity in the fund being held by appellant until after the foreclosure sale. If there is then a deficiency in the amount due to appellant the funds can properly be applied toward reducing such deficiency. If there is no deficiency, the claim of appellee to such funds can then be recognized and any portion thereof to which appellee may be entitled may be paid to it.”

Appellant contends and the record shows that this case was submitted to the court upon appellee’s motion for summary judgment on its suit on the note and for foreclosure of the deed of trust. No motion for severance was made. The court granted appellee’s motion for summary judgment but did not at the time order a severance. Thereafter, subsequent to the filing of appellant’s motion for new trial on the summary judgment, the court ordered a severance of appellee’s cross action from appellant’s suit against appellee, the Federal Housing Commissioner and the Secretary of the Air Force, and it was provided that the latter cause would thereafter bear a different number on the docket of the court. The order of severance further provided that the summary judgment previously rendered be made final.

We overrule appellant’s fifth point in which it is urged that since the court granted a summary judgment without at the same time severing appellee’s cross action seeking damages for alleged conspiracy, it was error for the court to thereafter grant a severance. The summary judgment was not final until it was severed. The order of severance confirmed the previous order granting appellee’s motion for summary judgment. The effect of the severance was to make the summary judgment final and appealable. Craig v. Rio Grande Electric Cooperative, Tex.Civ.App., 346 S.W.2d 438 (Ref. N.R.E.); Sears v. Mund Boilers, Inc., Tex.Civ.App., 328 S.W.2d 199 (Writ Ref.); Pierce v. Reynolds, 160 Texas 198, 329 S.W.2d 76; Hamilton v. Hamilton, 154 Texas 511, 280 S.W.2d 588.

The judgment is affirmed.


author: LANGDON, Justice.

text:
    CARGILL, INC., Appellant, v. CONTINENTAL GRAIN COMPANY, Appellee.
    No. 16607.
    Court of Civil Appeals of Texas. Fort Worth.
    Feb. 12, 1965.
    Rehearing Denied March 19, 1965.

      Gayle E. Oler and Jay S. Fichtner, Dallas, for appellant.
    Allison, Mann & Allison, and Earl R. Allison, Levelland, for appellee.
   LANGDON, Justice.

This is an interpleader suit by Continental Grain Company against C. G. Israel, Cargill, Inc., and Ruben Leach, d/b/a Fargo Grain Company.

Leach purchased some grain from Car-gill. Continental purchased the grain from Leach and in payment therefor gave Leach its draft, dated March 1, 1962, payable to Fargo Grain Co., in the sum of $4,344.63. Israel hauled the grain from the point of purchase to Houston, Texas, where Continental took title to it. Leach did not pay Cargill for the grain or Israel for hauling it.

Because of the money owed them for grain and hauling respectively, Cargill and Israel, each acting independently of the other, made intensive efforts to locate Leach. Cargill found him first on March 14, 1962, and sought to induce him to endorse the Continental draft to it in payment for the grain. Leach advised that the draft had been lost. At Cargill’s suggestion Leach called and confirmed in writing a request to Continental that it stop payment on the lost draft and issue a replacement draft payable to Cargill or to him and Cargill, whichever would better suit its bookkeeping requirements. Continental agreed to do so. Israel had no notice of these oral and written instructions. Continental acknowledged the instructions to stop payment but did not immediately issue a replacement draft.

In the meantime, on March 30, 1962, before Continental issued the replacement draft, Israel finally located Leach. On this occasion Leach had the original Continental draft, on which he had stopped payment, in his possession. The draft was complete and regular on its face and unconditional. Leach endorsed the draft and tendered it to Israel in payment of the hauling debt. Having no notice of the stop payment or other instructions relating to the draft, Israel endorsed it and requested his son to cash it at his bank. Israel, upon receiving the cash, took the sum of $660.00 due him and paid the balance in cash to Leaeh.

The draft was later returned by the bank because its payment had been stopped. At this point Continental, which had not yet issued the second draft, and being confronted with adverse claims to the money by Israel and Cargill, impleaded all parties and paid the monies owed by it into the registry of the court. Both Leach and Continental were dismissed from the case, leaving Cargill and Israel in the controversy for the money.

The trial was to a jury. It found that the original draft was negotiated from Leach to Israel within a reasonable time considering the nature of the instrument and the usage in the trade and that Israel in taking the draft had not acted in bad faith. Based upon the verdict, judgment was entered by which Continental was awarded its attorney’s fees in the sum of $350.00 and discharged. The balance of the money, amounting to $3,994.63, was awarded to Israel. Cargill took nothing. We affirm.

By ten points of error appellant contends the court erred in (1) granting Israel judgment for the total amount of the draft; (2) failing to render judgment for Cargill for all funds in excess of $660.00; (3) submitting special issue No. 2 and in failing to give a proper definition of “bad faith” in connection therewith; (4) refusing to submit its requested issue inquiring whether Leach had instructed Continental to pay Cargill the money it owed him; (5) failing to submit requested issues in support of its contention that Israel was an accommodation endorser rather than a holder in due course; (6 and 7) failing to submit issues to the effect that cash grain drafts are ordinarily presented for payment substantially less than thirty days, and as to Israel’s experience in buying and selling grain; (8) refusing to submit requested instruction on reasonable time for negotiating draft in connection with Special Issue No. 1; (9) rendering judgment on the verdict because there was no evidence, or (10) insufficient evidence to support the jury’s answers to the issues submitted.

Article 5935, § 52, Vernon’s Ann.Civ.St.,, of the Negotiable Instruments Act, defines a holder in due course as one who has taken the instrument under the following conditions: (1) that it is complete-and regular upon its face; (2) that he became the holder before it was overdue and without notice that it had been previously dishonored, if such was the fact; (3) that he took it in good faith and for value; (4) that at the time it -was negotiated to him he had no notice of any infirmity in the instrument or defect in the title of the person negotiating it.

Under Section 56 of Art. 5935, supra, “To constitute notice of an infirmity in the instrument or defect in the title of the person negotiating the same, the person to whom it is negotiated must have had actual knowledge of the infirmity or defect, or knowledge of such facts that his action in taking the instrument amounted to bad faith.”

It is undisputed that the draft in question was complete and regular upon its face and unconditional. It was not overdue. The jury found it was negotiated within a reasonable time. W. L. Holder, executive assistant to Continental Grain Co., testified that quite a few of the Continental drafts were delayed thirty days or more. There was nothing unusual in one coming hack after thirty days. His Company had some outstanding at the time which were several months old. This was all right with his Company as long as there were no changes in the drafts on presentment. He estimated 5% or more, perhaps 10%, of their drafts would he outstanding a rather irregular and indefinite period of time.

Israel took the draft in good faith and for value. He was out the $660.00 due him plus the cash he handed Leach for the draft. Without question he paid full value. “Although payment of a valuable consideration is essential to the protection of the purchaser, it is not necessary that the consideration be full and adequate. * * *” 9 Tex.Jur.2d, p. 114, § 99.

The jury found that he had not acted in bad faith. The record reflects that Israel was familiar with Continental drafts. He had always found them to be “okay”. He relied on the one in question as being “okay”. It was complete and regular on its face. He had no knowledge, actual or otherwise, of any defects in the payee’s title. 9 Tex.Jur.2d, pp. 111-113, § 98.

The appellant contends that Israel was an accommodation endorser and not a holder in due course and that therefore he is entitled to all of the proceeds by virtue of the March 14, 1962 assignment or the amount of the proceeds in excess of $660.00.

On the question of assignment the appellant relies mainly on the case of Clay-Butler Lumber Co. v. W. R. Pickering Lumber Co., Tex.Civ.App., 264 S.W. 267, affirmed in 276 S.W. 664 by the Commission of Appeals in an opinion adopted by the Supreme Court. That case involved an assignment of a debt and check in payment thereof. Suit was filed based on the assignment and Clay-Butler intervened, claiming to succeed to the rights of a Cross Plains Bank as a holder in due course, whereas the Bank was serving only as a collection agency. Neither Clay-Butler nor the Bank paid any money for the check involved. Neither was therefore a holder in due course. See 9 Tex.Jur.2d, p. 127, § 110 (Bank as holder in due course) and cited authorities.

We find no application of the Clay-Butler case, supra, or other cases cited by appellant to the facts of this case.

Finding, as we do, that Israel is a holder in due course, it follows that as holder of the draft, which at the time of its acquisition was complete and regular upon its face, he is presumed to have acquired the draft in compliance with the conditions enumerated under Section 52 of Art. 5935, supra. 9 Tex.Jur.2d, p. 110, § 97.

“ * * * Where value has at any time been given for the instrument, the holder is deemed a holder for value in respect to all parties who became such prior to that time. The extinguishment, in whole or in part, of a past-due debt is a valuable consideration for the transfer of commercial paper * * *.” 9 Tex.Jur.2d, p. 109, § 96.

“A holder in due course holds the instrument free from any defect of title of prior parties, and free from defenses available to prior parties among themselves, and may enforce payment of the instrument for the full amount thereof against all parties liable thereon.” Art. 5935, § 57, V.A.C.S.

* * * This is an elementary rule of the law merchant and was applied prior to the enactment of the Uniform Negotiable Instruments Act. It is of course essential that the instrument should be negotiable in order to entitle a holder to protection as a holder in due course. * * * ” 9 Tex. Jur.2d, p. 128, § 111.

A holder in due course is entitled to recover against the maker, notwithstanding there may be a good defense to the instrument against the payee. The burden of proof is on the one who denies that the instrument is held in due course to establish this fact by a preponderance of the evidence. 9 Tex.Jur.2d, pp. 307-308, § 282.

Since it is undisputed that Leach did instruct Continental on March 14 to stop payment on the draft and to issue a replacement draft payable to appellant, it was not error for the court to refuse submission of an issue on the matter.

We have concluded that there was no evidence to show that Israel’s knowledge was such as to evince bad faith in the taking of the draft. However a proper issue and instruction thereon was submitted to the jury and answered favorably to Israel. The court did not err in refusing to submit the issue and instruction of the appellant. 9 Tex.Jur.2d, pp. 348-349, § 312; Section 56, Art. 5935, V.A.C.S. (Negotiable Instruments Act).

There was no evidence to support the issue on accommodation endorser. The court’s instruction in connection with Special Issue No. 1 as to reasonable time for negotiation was proper. Other issues requested by appellant were evidentiary in nature and were properly refused.

In deciding the “no evidence” points, this Court has viewed the evidence in its most favorable light in support of the findings of vital facts considering only the evidence and the inferences which support the findings and rejecting the evidence and inferences contrary thereto. In doing so, we concluded there is ample evidence to support the jury’s findings. In considering the evidence in its entirety we have concluded that the jury’s findings are not so contrary to the great weight and preponderance of the evidence as to be clearly wrong and unjust.

All points of error are overruled and the judgment of the trial court is affirmed.

Affirmed.


author: NYE, Justice.

text:
    LONE STAR GAS COMPANY, Appellant, v. COASTAL STATES GAS PRODUCING COMPANY, Appellee.
    No. 96.
    Court of Civil Appeals of Texas. Corpus Christi.
    March 4, 1965.
    Rehearing Denied March 25, 1965.

      Roy E. Pitts, J. Harold Goode, Richard B. Williams, Dallas, for appellant.
    Frank W. Nesbitt, of Fischer, Wood, Burney & Nesbitt, Corpus Christi, for ap-pellee.
   NYE, Justice.

This is a venue case. Coastal States Gas Producing Company brought suit against Lone Star Gas Company in the District Court of Nueces County for damages claimed by reason of an alleged breach of contract to “take or pay” for the minimum quantities of gas provided for in a written gas purchase contract. Lone Star Gas, as buyer, agreed to purchase and receive from Coastal States, as seller, gas at the outlet of certain wells owned and operated by Coastal States in certain designated counties. Lone Star Gas filed its plea of privilege to be sued in the county of its residence, Dallas County. Coastal States controverted Lone Star Gas Company’s plea of privilege under Subdivisions 23 and 5 of Article 1995, Vernon’s Ann.Tex.Civ.St. The facts were stipulated by both parties. The trial court overruled the plea of privilege. Lone Star Gas perfected its appeal to this Court.

Appellant Lone Star Gas Company’s first point complains of the trial court’s overruling its plea of privilege under Subdivision 5 of Article 1995, V.A.T.S. Appellee Coastal States abandons its contentions that the venue in this suit can be sustained in Nueces County under Subdivision 5 of Article 1995, V.A.T.S. It contends, however, that venue is proper in Nueces County by virtue of a portion of the statutory exception under Subdivision 23 of Article 1995, V.A.T.S.

The provision relied on by appellee states in effect that suits against a private corporation may be brought in the county in which the cause of action, or part thereof, arose. Appellee plead, and it was later stipulated for the purpose of the hearing on the plea of privilege (and for no other purpose) that Lone Star Gas Company (a private corporation) breached the contract in question with resulting damages. Consequently, within the meaning of Subdivision 23 of Article 1995, V.A.T.S., a cause of action arises in part within the county where the contract is made. Gleason v. Southwestern Sugar and Molasses Co., 214 S.W.2d 640, Tex.Civ.App.1948 and cases cited therein; for requirements see Appell Petroleum Corp. v. G. W. Townsend Lease Serv., 375 S.W.2d 547, Tex.Civ.App.1964, and Drexler v. Architectural & Commercial Sales, 375 S.W.2d 550, Tex.Civ.App.1964. The sole question before this Court is to determine whether the contract was “made” in Nueces County or whether it was “made” in Dallas County, Texas. If the contract, the subject of this suit, was made in Nueces County, Texas, and subsequently breached, then venue would be proper in Nueces County. If, under these conditions, the contract was made in Dallas County, then the plea was good and the case should be (because the facts were fully developed) reversed and rendered by this Court.

Lone Star Gas Company executed two copies of the gas purchase contract in Dallas, Texas, and enclosed the two copies with a cover letter to Coastal States at Corpus Christi using the United States mail. The cover letter, dated June 19, 1959, together with the two gas contracts, was received by Coastal States in Corpus Christi, Texas. The pertinent portion of the letter, addressed to Coastal States, stated:

“ * * * we are enclosing the following:
“ * * * (3) Two copies of gas purchase contract dated June 3,1959. This has been executed on the part of Lone Star Gas Company and is being sent to you with the provision that the instrument is void unless executed by you and returned to us on or before June 30,1959. After execution on your part please retain the carbon copy for your files and send the original to us.
“ * * * We have enjoyed the negotiations regarding this transaction and hope that it will be mutually profitable to both of us.
“Yours very truly,
“Lone Star Gas Company.”

(Emphasis supplied)

Coastal States followed the instructions of the cover letter, executed the contracts, and sent the original to Lone Star Gas by United States mail on June 22, 3959. Appellant stipulates that the contract was timely received.

The appellant contends that “return” and receipt of the fully executed contract was a condition precedent to a final acceptance of the offer and that there was no contract and no acceptance which fulfilled the condition of the offer until the fully executed contract was “returned” and received. If this contention be correct, then the contract would not. have been “made” until it was actually received in Dallas as contended by Lone Star Gas.

Appellant argues that the provision of the offer that “ * * * the instrument is void unless * * * returned to us on or before June 30, 1959”, required delivery of the executed contract to Lone Star Gas as a final act completing the contract. Citing Williston on Contracts, § 88 which states:

“It necessarily follows from the power of the offeror to dictate the conditions of the contract, and the way it may be accepted, that he may require the letter or telegram of acceptance1 actually to be received before a contract shall be formed * * *. This requirement need not be in express words; it is enough if the offer imposes a condition which cannot be satisfied until the acceptance is received * * * ”

The question, then, was there such a condition in the cover letter?

It is true that the appellant, as offeror, could dictate the manner and place of acceptance. Western Union Telegraph Co. v. Gardner, 278 S.W. 278, Tex.Civ.App. 1925; Williston on Contracts, § 76; 3 Hilldebrand, Texas Corporations, page 289. However, the cover letter did not specifically require that the contract must have been received in Dallas before the deadline to give it validity or to have come into being. It then becomes apparent to us that the cover letter containing the offer must be considered as a whole in order to give effect to the general purpose and the true intentions of the parties. The court will examine and consider the entire writing, seeking, if possible, to harmonize and give effect to all provisions of the letter so that none will be rendered meaningless. Universal C.I.T. Credit Corp. v. Daniel, 150 Tex. 513, 243 S.W.2d 154 (1951). With these rules in mind, let us look at the letter, giving effect to the language contained within the four •corners of the instrument.

It is apparent from the letter of transmittal that the parties had been negotiating for some time and had reached the stage of reducing the fruits of their agreements to writing. (Lone Star Gas Company stated in the cover letter * * * “We have enjoyed the negotiations regarding this transaction and hope that it will be mutually profitable to both of us.”) The negotiations were over. The parties were in the final stages of consummating the completed contract. Lone Star Gas Company executed the original and one copy of the contract and specified that the contract must be executed by Coastal States. This was done. Another obligation on the part of the ap-pellee, Coastal States, was that the contract must be returned. What does return mean ? Of course, it has many meanings and many connotations. Return implies a going back to a starting place; to re-deliver; to send back; a means for re-conveying something to its starting point. We believe that solace is had in determining the meaning and intention of the offeror-appellant of the term “returned”, by looking at the subject letter to ascertain: (1) the method used by the appellant in delivering the contract, and (2) by the instructions appellant gives to appel-lee for returning the contract. First: Appellant states in the letter that the contract has been executed by Lone Star Gas Company “and is being sent to you” (original and one copy was sent to appellee by U. S. mail). This would surely sanction use of the same method of reconveyance as was used by appellant — (the U. S. mail). Appellant required that the contract be “ * * * returned to us on or before June 30, 1959.” The deadline was met. They do not state that the contract must be received by them on or before June 30, 1959. For instance, does not the term “on or before” imply that Coastal States could return the contract on June 30, 1959, as well as before June 30th ? We think it does.

At another place in the cover letter (paragraph number 2), appellant states that:

“ * * * we are enclosing the following:
“ * * * (2) One copy of letter agreement dated June 8, 1959, relating to certain gasoline rights. This instrument has been executed by both parties and the copy we are returning to you is for your files. We have retained the original for our records.”

By returning the copy of the letter-agreement relating to certain gasoline rights to appellee, it had left the hands and control of appellant at the time it was mailed in Dallas to Coastal States. Nothing further had to be done relative to gasoline rights. In the subject paragraph number (3), a very similar situation exists, only in reverse. Lone Star Gas is requiring Coastal States to do the same as they did in paragraph number (2), namely, after executing the contract, they were instructed to keep a copy and return the original. The method by which the contract was to be returned would certainly imply the same as was used by appellant, i. e., the U. S. mail.

It has generally been held in this state that a contract is made at the place where the offer of the contracting party is accepted by the other party. Texas Supply Co. v. Clarke, Tex.Civ.App., 220 S.W. 573; Early-Foster Co. v. A. P. Moore’s Sons, Tex.Civ.App., 230 S.W. 787; Cowdin Grocery Co. v. Early-Foster Co., Tex.Civ.App., 237 S.W. 578; Gleason v. Southwestern Sugar and Molasses Co., supra. This acceptance is accomplished at the place where the last act necessary to give it validity is done. Texas Employers’ Ins. Ass’n v. Moore, Tex.Civ.App., 56 S.W.2d 652; 17A C.J.S. Contracts § 356, p. 355; Burtis v. Butler Bros., 228 S.W.2d 938, Tex.Civ.App. 1950; Woodman v. Bishop, Tex.Civ.App., 203 S.W.2d 977 (1947).

The agreement becomes obligatory the moment the minds of the parties meet and the acceptance is communicated in a proper manner to the offeror. It is sufficient if the offer is accepted in the mode impliedly required by the offeror. One who makes an offer through a particular channel impliedly authorizes an acceptance through the same channel or agency. Appellee’s acceptance was transmitted by the U. S. mail the same as impliedly authorized by the offeror-appellant. The contract became complete as soon as it was put out of the appellee’s possession. 17 C.J.S., Contracts § 45, p. 690; 13 Tex.Jur.2d 151, Contract, § 30; Blake v. Hamburg-Bremen Fire Ins. Co., 67 Tex. 160, 2 S.W. 368.

In the early case of Scottish-American Mortg. Co. Limited v. Davis, 96 Tex. 504, 74 S.W. 17, the Supreme Court of Texas stated the well-settled rule:

“The authorities are well-nigh unanimous in asserting that, when a party submits to another, through the mail, a proposition of purchase or sale, the receiver of the proposition has the right within a reasonable time, and before it is withdrawn, to accept by a writing deposited m the post office, duly stamped, ready for carriage and delivery; and such an acceptance binds the proposer of the contract from the time the deposit is made in the post office, whether it be delivered or not.” (citing cases).

This rule has never been changed in Texas. See Turner v. Day, 322 S.W.2d 300, Tex.Civ.App.1959, at page 305 (and cases cited therein).

We believe that there was an effective offer “made” at that moment when the same was mailed from Dallas. We hold that there was an effective acceptance at the moment that Coastal returned the contract by mailing it on June 22, 1959. The contract having been finally “made” in Nueces County, Texas, then a part of the cause of action arose in Nueces County, Texas, within the meaning of Subdivision 23 of Article 1995, V.A.T.S. Appellant’s points are overruled. The judgment of the trial court is affirmed.

Affirmed.


author: FRASER, Chief Justice.

text:
    Roger Doyle HOESTENBACH, Appellant, v. Wanda Faye HOESTENBACH, Appellee.
    No. 5690.
    Court of Civil Appeals of Texas. El Paso.
    Jan. 20, 1965.
    Rehearing Denied March 24, 1965.

      Lee Arnett, Odessa, for appellant.
    H. S. Harris, Jr., Midland, for appellee.
   FRASER, Chief Justice.

This is an appeal from a judgment of the District Court of Midland County, Texas which changes the terms of a previous judgment rendered by the same court. The original action was one for divorce, disposition of community property and custody of two minor children. The court rendered its first judgment on October 31, 1962 granting custody of the children to the mother with certain visitation privileges to the plaintiff-husband, who is appellant here. The court also, in that original judgment, awarded the defendant certain property, including the home and the furniture therein, and a 1953 Ford car, defendant being required to pay certain of her debts to several stores. The plaintiff was ordered to pay the sum of $125.00 per month for the support of the two children and further ordered to pay $75.00 on defendant’s attorney’s fees. The plaintiff was awarded full title to what has been described as the “Shell Provident Fund” which, while not adequately described within the record, appears to be some sort of pension fund earned by plaintiff.

On November 9, 1962 the defendant filed a motion for new trial alleging that she had good .reason to believe that the Shell Provident Fund amounted to more than the $5000 value given it by the plaintiff in his pleadings and testimony. The court granted this motion, and a new trial was had and another judgment, substantially the same as the first, was entered on December 7, 1962. Both of these judgments, in addition to the above matters recited that the parties had reached a full and satisfactory settlement of community property which the court had found to be equitable and proper. No motion for new trial or notice of appeal was filed with respect to this second judgment. On April 10, 1963 plaintiff filed a pleading which he calls an Application to Enlarge and Supplement the December judgment. In this pleading, whatever it is, he complains of the defendant’s failure to pay certain bills and failure of visitation privileges, and asks the modification of the visitation privileges of the two judgments. Defendant filed her answer to this Application, in which she states that she joins plaintiff in this Application and alleges that plaintiff had knowingly misrepresented the value of the Shell Provident Fund to both defendant and the court, for the purpose of defrauding defendant and that she, the defendant, had relied upon such representation, and was filing, along with her joinder in the plaintiff’s application, her prayer for an Equitable Bill of Review, in which she set forth the same allegations of fraud, and asked for a re-division of the property. On August 2, 1963, the trial court again heard this matter on the pleadings above described, and awarded the defendant an additional sum of $3,259.00 as a share of the Shell Provident Fund, this to be in addition to the property previously awarded and allocated to her.

Appellant appeals from this third judgment, or order, on the grounds that the implied findings of fact were not supported by any evidence to the effect that the original division of community property was inequitable, or that appellee was prevented from proving the correct value of the Shell Provident Fund by any act or accident caused by plaintiff; that there was no evidence to support any implied finding that appellee’s failure to prove the correct value of the Shell Provident Fund was not due to some negligence or fault on her part; and lastly, that the court did not have jurisdiction to enter certain orders contained in paragraphs 2, 3 and 4 of the August 2, 1963 judgment. These orders dealt with the $3,259.00 award above described.

We would first like to point out that there were no findings of fact or conclusions of law requested or filed. On the third hearing the record shows that the plaintiff testified in his behalf, and the defendant’s first attorney testified in her behalf, the only other evidence contained in the statement of facts being documentary. Further, although the court ordered plaintiff to file a sworn inventory and appraisement of the community property, such was never done. The statement of facts also contains a notation that plaintiff’s Exhibit 1, which apparently was some manner of computation, was not turned over to the reporter, and that he has never been able to locate it. We are further handicapped by the fact that there are several notations by the court reporter that some conversation or comments by the court were inaudible to the court reporter. Appellee did not file any brief on this appeal.

We have come to the conclusion that the judgment of the trial court should be affirmed. Although appellant challenges the court’s right to jurisdiction to try the matter, in his brief he points out that both parties joined in the application, and no exception was taken to the defendant’s pleading, and then states as follows: “We will assume for this point that the court had jurisdiction to hear the Equitable Bill of Review.” Appellant further states that we must presume that the trial court found the necessary facts sufficient to support the judgment, but challenges the court’s action on the ground that there was no evidence to support the necessary implied findings of fact. The subject of an Equitable Bill of Review has been discussed many times, and it is apparent from the various decisions that the courts, influenced no doubt by a desire to do equity, have been lenient and liberal in their treatment of this matter. 4 MacDonald Texas Civil Practice, § 17.08, page 1330. See also § 18.29, page 1503, and § 18.27, page 1497. In these various references it is pointed out that an inquiry such as this may be unexpectedly broadened by an allegation of fraud, and that in some situations relief is given, though the complainant does not bring himself strictly within the foregoing rules (ordinarily applicable to an Equitable Bill of Review), as to fraud, accident or mistake. Also, that by implication the petition incorporates the records of the court. In the matter before us, the plaintiff-appellant admits that he was mistaken in his original representation to the court that the Shell Provident Fund was worth $5000.00 only, and states that it was worth probably $2000 more than that. We find in the statement of facts certain exhibits which appear to be comparative inventories. These exhibits appear to have come to the court’s attention only in the last hearing, and the value of the various bits of furniture and other articles awarded to defendant show a shocking discrepancy between the value placed thereon by plaintiff and the value as found by an appraiser. As we have said above, there are no findings of fact or conclusions of law, but we feel that this prayer by the defendant for equitable relief was adequate and that there was sufficient evidence to justify the court in making the findings contained in the last judgment. As stated above, the appellant agrees that the trial court probably had jurisdiction, and we think this is a correct assumption based on the fact that both parties joined in the application, and that no exception was taken to defendant’s prayer for equitable relief by way of a Bill of Review. The' statement of facts does contain plaintiff’s own admission that he was wrong about the value of the Shell Provident Fund. We must assume that the court relied on his original statement and pleadings in making the division of property that he did make in the first two judgments.

Appellant maintains that appellee failed to show the necessary fraud or accident on the part of appellant entitling her to the re-division of property. In his brief appellant takes the position that the court did, and did not, have jurisdiction. In his discussion of the first three points, he states in his brief that he assumes, for the purpose of the point, that the court had jurisdiction; but in his discussion of Point 4 he maintains that the court did not have jurisdiction.

Because an Equitable Bill of Review does permit considerable latitude on the part of the trial court, and in fact clothes the court with considerable discretion, and further because the prayer for the Bill of Review was not excepted to, we believe the court had jurisdiction to hear the matter. Also, in the absence of Findings of Fact and Conclusions of Law, we must presume that the court made the necessary fact findings. On the basis of the record as outlined above, it is clear that the plaintiff intentionally or accidentally misrepresented the value of the Shell Provident Fund.

Appellant relies on a statement in appel-lee’s motion for new trial, to the effect that she believes his description of the fund was inadequate, as being sufficient to defeat her attempt at an equitable re-division. This, the appellant alleges, indicates that she knew before the second judgment was handed down, or should have known, that the amount alleged by plaintiff was incorrect, and he alleges that she was derelict in not calling for a new trial or appeal from this second judgment. We have no evidence on this matter one way or the other, except appellee’s own pleading. It is therefore clear that there was a substantial mistake made as to the value of the Shell Provident Fund, and it is our belief and holding that appellee substantially complied with the elements necessary to an Equitable Bill of Review, and that the record is sufficient from an evidentiary point of view to uphold the court’s necessary implied findings of fact.

Appellant’s four points are accordingly overruled, and the decision of the trial court is in all things affirmed.


author: MOORE, Justice.

text:
    TEXAS STATE BOARD OF MEDICAL EXAMINERS, Appellant, v. Clifford HAYNES, Appellee.
    No. 113.
    Court of Civil Appeals of Texas. Tyler.
    March 11, 1965.

      Waggoner Carr, Atty. Gen., Roy B. Johnson and Malcolm Quick, Asst.- Attys. Gen., Austin, William H. Kugle, Jr., Athens, for appellant.
    Joe Tunnell, Boulter, Fowler & Tunnell, Tyler, W. B. Fields, Fields & Fields, Athens, for appellee.
   MOORE, Justice.

The Texas State Board of Medical Examiners, acting under the provisions of Articles 4505 and 4506, Vernon’s Ann. Civ. St., revoked and permanently cancelled the license to practice medicine of appellee, Clifford Haynes, M.D. The order of the Board was as follows:

“On this 21st day of June, 1963, came on to be heard before the Texas State Board of Medical Examiners, duly in session, a certain complaint filed with the Board on the 31st day of May, 1963, in which it was complained that Clifford Haynes, M.D. of Malakoff, Henderson County, Texas, had violated the provisions of Sub-Divisions (4) and (5) of Article 4505, Revised Civil Statutes of Texas, 1925, as amended, in that said Clifford Haynes, M.D., initiated a course of conduct in connection with his professional medical practice in Malakoff, Henderson County, Texas from January 1, 1960 through March, 1962, wherein, during such period of time, in the Haynes Hospital, Malakoff, Henderson County, Texas, the said Clifford Haynes, M.D. has committed certain acts of oral sodomy on a minor male patient, and certain acts of fondling of the private parts of a minor male patient; such acts resulting in a violation of the above referenced Sub-Divisions (4) and (5) of Article 4505, Revised Civil Statutes of Texas, this constitutes grounds for the cancellation, revocation or suspension of the license to practice medicine in the State of Texas by Clifford Haynes, M.D.; and the said Clifford Haynes, M.D. having appeared in person with his attorneys, Mr. Joe Tunnell of Tyler, Texas, and Mr. W. B. Fields, of Athens, Texas; and the Board having first considered respondent Clifford Haynes’ motion to dismiss, special exception to the Board’s affidavit and general denial and having found that same should be and each was overruled; and the said charges and complaint having been read, and the evidence on said charges having been introduced and heard, and after consideration of the charges and the evidence, the Board is of the opinion that the charges contained in the complaint are true, therefore
“IT IS ACCORDINGLY ORDERED, ADJUDGED AND DECREED, that the license to practice medicine within the State of Texas, heretofore held by Clifford Haynes, M. D., is revoked and cancelled.
“Rendered and entered this 21st day of June, 1963.”

The statutes set out several grounds for the cancellation of a license. Among them is Section (4) of Article 4505:

“Grossly unprofessional or dishonorable conduct, or a character which in the opinion of the Board is likely to deceive or defraud the public.”

The provisions of Article 4506 provide for appeal from the orders of the Board as follows:

“ * * * The proceeding on appeal shall be a trial de novo, as such term is commonly used and intended in an appeal from the justice court to the county court, and which appeal shall be taken in any District Court of the county in which the person whose certificate of registration or license is involved, resides. * * * ”

Haynes appealed from the order of cancellation and filed suit in the District Court of Henderson County, seeking to permanently enjoin the Board from enforcing the order. The appellant Board answered alleging that there was substantial evidence to support the Board’s order and affirmatively alleged that Haynes had, at various times during 1960 and 1962, committed various acts of oral sodomy on four minor male patients as well as fondling their private parts, which acts were such as to constitute grossly unprofessional and dishonorable conduct or a character which was likely to deceive or defraud the public, in violation of Article 4505, supra.

Prior to the trial, the appellant Board filed a motion requesting that the trial be conducted in accordance with the substantial evidence rule. The court overruled the motion and ordered the case tried pursuant to the appeal provisions of Article 4506 which require that the proceedings on appeal shall be in the nature of a trial de novo, as such term is commonly used and intended in an appeal from the justice court to the county court. Under the ruling of the trial court, the burden of sustaining its order was thus placed on the Board. A jury having been waived, trial was before the court sitting without a jury. The Board tendered the testimony of four minor male patients, each of whom testified that Haynes at various times had committed certain acts of oral sodomy upon them. Their sworn testimony was fully developed before the court. It is not necessary nor would not be in good taste to set out the details of the shocking testimonies contained in the record. It is sufficient to say that the testimony of each of the four witnesses adequately raised the issues upon which the charges were based.

Testifying in his own behalf, the doctor denied any act of improper conduct with any of the minor male patients.

At the conclusion of the trial, the court rendered judgment for the appellee Haynes setting aside the order of the Board and perpetually enjoined and restrained the Board from enforcing or attempting to enforce or effectuate its order, to which ruling the Board prosecuted this appeal.

Appellant, by two points of error, contends that the judgment should be reversed because the trial judge refused to order that the trial be conducted under the substantial evidence rule and that the trial court erred in granting judgment for appellee because there was substantial evidence to support the Board’s administrative order.

This cause was tried, appealed and briefed in this court prior to the announcement of the recent decision of the Supreme Court in Scott v. Texas State Board of Medical Examiners, Tex., 384 S.W.2d 686. In view of this decision the substantial evidence rule obviously has no application to the facts presented here and therefore appellant’s points of error must be overruled.

In that case the Board had cancelled Scott’s license after having found that he had prescribed narcotic drugs for known addicts and had prescribed narcotic drugs for patients having no medical need therefor. Upon appeal Scott took the position that Article 4506 requires that he be afforded a full trial de novo, while the Board contended that the cause should have been tried under the substantial evidence rule. In construing the appeal provision of the statute, the Supreme Court held:

“In the type of appeal thus required the court tries the issues anew. The burden of proof in sustaining the order is upon the administrative agency. Whether by the court or a jury, fact questions are resolved by a preponderance of the evidence. Southern Canal Co. v. State Board of Water Engineers, 159 Tex. 227, 318 S.W.2d 619 (1958); State by and through State Board of Morticians v. Cortez, 160 Tex. 532, 333 S.W.2d 839 (1960); Key Western Life Insurance Co. v. State Board of Insurance, 163 Tex. 11, 350 S.W.2d 839 (1961).”

Citing also Rockett v. Texas State Board of Medical Examiners, 287 S.W.2d 190, (C.C.A.1956, writ ref. n. r. e.); Watt v. Texas State Board of Medical Examiners, 303 S.W.2d 884 (C.C.A.1957, writ ref.); Jacobi v. Texas State Board of Medical Examiners, 308 S.W.2d 261 (C.C.A.1957, writ ref. n. r. e.); and Texas State Board of Medical Examiners v. McClellan, 307 S.W.2d 317 (C.C.A.1957, writ ref. n. r. e.).

Accordingly, we hold that in the type of appeal involved here, the statute requires that the issues be tried anew. The trial court correctly followed this procedure. The administrative agency had the burden of convincing the trier of the fact, not only that misconduct had occurred, but also that such conduct was of such character as would be likely to deceive or defraud the public. Texas State Board of Medical Examiners v. Koepsel, 159 Tex. 479, 322 S.W.2d 609 (1959). The judgment rendered by the trial court is tantamount to finding that appellant failed to discharge its burden of proof.

The appellant did not request findings of fact and conclusions of law, but chose to appeal without the benefit of such findings. There are no assignments complaining of the lack or insufficiency of the evidence, yet appellant contends in argument that this court is authorized to reach a conclusion contrary to that of the trial judge.

It is settled law that where no findings of fact or conclusion of law have been filed by the trial court, the appellate court must presume that the trial court found all facts in favor of its judgment to be true, and will be bound by such findings, if there is any evidence of probative force in the record to support the same; and that the court on appeal will not substitute its opinion with respect to the credibility of the witnesses and the weight of the evidence for that of the trial court. Rosenberg v. Levin, 181 S.W.2d 832 (Tex.Civ.App.), 1944, err. ref.; Renfro Drug Co. v. Lewis, 149 Tex. 507, 235 S.W.2d 609, 23 A.L.R.2d 1114.

The judgment of the court below is affirmed.


text:
    GENERAL INSURANCE COMPANY OF AMERICA, Appellant, v. SMITH & WARDROUP, INC., Appellee.
    No. 7440.
    Court of Civil Appeals of Texas. Amarillo.
    Feb. 15, 1965.
    Rehearing Denied March 15, 1965.
    Finley & Scogin, Kermit, for appellant.
    Brown & Shuman, Lubbock, for appellee.
   NORTHCUTT, Justice.

This is a suit that was instituted by Smith & Wardroup, Inc., appellee, under the provisions of Article 5160 relating to the rights of persons or corporations furnishing labor or material in a contract with a state agency. Suit was against C. V. Thornton Company, Inc., the original contractors, Midland National Bank of Midland, Texas, as-signee of C. V. Thornton Company, Inc., and General Insurance Company of America and Buster Cole, who were alleged to be joint sureties on the bond of C. V. Thornton Company, Inc. Appellee, Smith & Ward-roup, Inc., alleged that it engaged in the general paint contracting work and that C. V. Thornton Company, Inc., entered into a contract, acting as general contractor, to erect a maintenance office, storage shop and. service station building in Plains, Yoakum County, Texas, for the Texas Highway Department. Appellee alleged that it was a sub-contractor under C. V. Thornton Company. Copy of its contract was attached to the original petition. Under the terms and provisions of the contract C. V. Thornton Company was to pay to the appellee, who were plaintiffs in said suit, the sum of $2,450. The contract also provided for addendas to the job, increasing the total due to the appellee under said contract to a total of $2,560. There was an allegation that no payment had been made and that this sum remained unpaid. The appellee alleged notice of claim for material furnished to General Insurance Company of America and to Buster Cole, as well as to C. V. Thornton Company, Inc., under the provisions of Article 5160 of Texas Vernon’s Annotated Civil Statutes.

Upon the trial of the case Midland National Bank was dismissed from the case and at the end of the plaintiff’s testimony an instructed verdict was given in behalf of Buster Cole.

Smith & Wardroup, Inc., also pleaded in the alternative that if it did not strictly comply with all the terms and provisions of Article 5160 of Vernon’s Texas Annotated Civil Statutes in order to secure payment under the payment bond executed by General Insurance Company of America that General Insurance Company of America was estopped from denying liability under its payment bond because it has waived its right to demand strict compliance with Article 5160, further pleading other matters as to filing claims with C. V. Thornton Company, Texas Highway Department, and General Insurance Company of America.

The letter relied upon as waiving strict compliance of Article 5160 if Smith & Wardroup, Inc., had not strictly complied with said article in presenting its claim is as follows:

“This will acknowledge receipt of your claim which you apparently sent to our Seattle, Washington Office a copy of which was sent to us. This is to advise that our indemnitor, Mr. Buster Cole Y Ranch, Goldsmith, Texas, has agreed to let us know not later than July 13th, 1961 whether he intends to take over direct payment of these claims or through a joint account with us. In the event he declines to do so then we will undertake to pay all valid and verified claims. In any event, you should expect to receive your money, if the claim is valid not later than the end of the month. We trust this is satisfactory.”

The case was submitted to a jury upon two special issues and the issues and answers thereto are as follows:

“SPECIAL ISSUE NO. 1
“Do you find from a preponderance of the evidence that the defendant, General Insurance Company of America, by their letter of July 13, 1961 waived their right to insist upon strict compliance with Article 5160 of Texas Annotated Civil Statutes?
“Answer ‘Yes’ or ‘No.’
“ANSWER: YES
“If you have answered Special Issue No. 1 ‘Yes’, and only in such event, then answer the following Special Issue:
“SPECIAL ISSUE NO. 2
“Do you find from a preponderance of the evidence that the waiver, if any, of compliance with Article 5160 of Texas Annotated Civil Statutes was withdrawn by General Insurance Company of America on or about September 11 or 13, 1961?
“Answer ‘Yes’ or ‘No.’
“ANSWER: NO”

No objections were made as to the charge given, nor the special issues submitted.

Judgment was granted in favor of Smith & Wardroup, Inc., for the sum of $2,450, together with interest thereon at the rate of six per cent per annum from June 20, 1961, until paid plus attorney’s fees in the amount of $750, together with interest thereon in the rate of six per cent per annum from date of judgment until paid. From that judgment General Insurance Company of America perfected this appeal and will hereafter be referred to as appellant and Smith & Wardroup, Inc., will be referred to as appellee.

Appellant presents this appeal upon thirteen assignments of error but all of them are based upon the contention the appellee did not comply with Article 5160 and no proper showing that appellant waived its right to require strict compliance with Article 5160 or to demand substantial compliance with said article.

The appellee had a written contract to furnish the materials and do the painting on the building in question for the sum of $2,450. There is no contention made that appellee did in any manner fail to complete the contract as it contracted to do. Under this record it is undisputed that appellee completed the job as contracted. That being true there could be no question but that appellee’s claim was a valid claim. Should it be said the answer to Special Issue No. 1 is a question of law and not a question of fact, we would consider, as a matter of law, the appellant had waived further compliance with Article 5160. It is stated in United Benefit Fire Ins. Co. v. Metropolitan Plumbing Co., Tex.Civ.App., 363 S.W.2d 843, as follows:

“It is well settled that a right or privilege given by statute may be waived or surrendered, in whole or in part, by the party to whom or for whose benefit it is given, if he does not thereby destroy the rights and benefits conferred upon or flowing to another in or from the statute or other legal or equitable source.
“Assuming, for purpose of this opinion only, that the notice actually given by plaintiff was insufficient to meet and satisfy the requirements of the statute —did the surety, by virtue of its acts and conduct, waive strict compliance on the part of the plaintiff with the notice requirements of the statute, so as to preclude the surety from asserting its discharge ?”

It is the contention of appellant that it later, after writing the letter above set out, let appellee know it was requiring compliance with Article 5160 and required further proof. On October 10, 1961, appellant wrote a letter to appellee denying liability, after the time had expired for appellee to file claim in accordance to Article 5160, referring to a telephone conversation between appellant and appellee on September 13, 1961, in which appellant advised appellee that its claim did not comply with Article 5160. Appellee denied that any such telephone conversation ever took place. In answer to Special Issue No. 2 the jury found that the waiver, if any, of compliance with Article 5160 was not withdrawn by appellant on or about September 11 or 15, 1961. We are of the opinion, and so hold, under this record that appellant is estopped to deny liability herein since it had waived further compliance with Article 5160 and had led appellee to believe its claim was approved by appellant and would be paid by the end of July, 1961.

It is stated in Kuehne v. Denson, 148 Tex. 54, 219 S.W.2d 1006, as follows:

“ ‘The purpose of estoppels is to prevent inconsistency and fraud resulting in injustice.’ 31 C.J.S., Estoppel, § 1, page 192. Although the case involves only estoppel in pais, Davis, Receiver, v. Allison, 109 Tex. 440, 211 S.W. 980, 984, applies as well to all other estoppels when it declares: ‘Estoppel is a doctrine for the prevention of injustice. It is for the protection of those who have been misled by that which upon its face was fair, and whose character as represented parties to the deception will not, in the interest of justice, be heard to deny. But one entitled to its protection must have been misled.’ ” ■

See also Hubacek v. Manufacturers Cas. Ins. Co., Tex.Civ.App., 247 S.W.2d 173 (N.R.E.); and Everett v. Everett, Tex.Civ.App., 309 S.W.2d 893 (N.R.E.).

We have carefully considered each and all of appellant’s assignments of error and overrule all of them. Judgment of the trial court is affirmed.