text:
    BRILEY v. KELTNER.
    No. 3459.
    Court of Civil Appeals of Texas. Amarillo.
    April 15, 1931.
    Rehearing Denied May 20, 1931.

      B. P. Maddox,‘of Tahoka, and York & Camp, of Abilene, for appellant.
    G. H. Nelson, of Tahoka, and Lockhart, Garrard & Brown, of Lubbock, for appellee.
   JACKSON, J.

The plaintiff, W. G. Briley, instituted this suit in "the district court of Lynn county, Tex., against the defendant, C. B. Keltner, to recover the sum of $1,459.50, with interest thereon at six per cent, per annum from May 7; 1929, alleged to be due him by the defendant for his services as a real estate broker.

The plaintiff alleges that he is a real estate broker, and that the defendant, oh May 7, 1929, was the owner of certain real estate situated in Tahoka, Lynn county, Tex., fully described in the petition; that some time prior to said date the defendant, as owner, listed said real estate with the plaintiff for sale or exchange on terms and conditions to be agreed upon between the • defendant and any purchaser found by the plaintiff interested in such purchase or exchange; that the defendant was especially interested in exchanging his real estate for ranch property, and promised and agreed to pay plaintiff for his services 5 per cent, commission on a sale, and, if a purchaser was found who was willing to make an exchange of properties with the defendant on terms and conditions to be arranged and agreed upon between the defendant and such purchaser, the defendant promised and agreed to pay plaintiff 2½ per cent, commission on the exchange value of the property received by the defendant and 5 per cent, on the price secured in excess of the value of the property accepted by the defendant; that on May 7, 1929, the plaintiff procured a party in the person of J. W. Evans, with whom the defendant entered into a binding written contract to exchange his property in Tahoka, Tex., for the ranch property of the said Evans in Lampasas county, Tex.; that by the terms of said contract the defendant agreed to convey his real estate to J. W. Evans, and J. W. Evans agreed to convey his ranch to the defendant on the terms and conditions agreed upon between them and expressed in said written contract; that the plaintiff was- the procuring clause of the making and execution of said contract for the exchange of the properties..

The plaintiff alleges the terms and conditions of said written contract, the value of the property agreed upon in the exchange, the price in excess of the agreed exchange value, and the amount of his commission based thereon, and attaches to his petition and makes a part thereof a copy of said contract; that, upon the execution of said contract, his commission was due and payable under his brokerage agreement with the defendant. He also alleges sufficient facts to authorize a recovery on quantum meruit.

He further pleads that, some time after the execution of the contract of exchange, the defendant and said Evans, by mutual agreement, agreed to cancel and did cancel said exchange contract without the knowledge or consent of the plaintiff, and the defendant has failed and refused to pay plaintiff his commission or any part thereof, to his damage in the amount above stated.

The defendant answered by general demurrer and general denial.

The ease was submitted to. the court without the intervention of a jury and judgment rendered that plaintiff take nothing by his suit and the defendant go hence with his costs, from which judgment this appeal is prosecuted.

The appellant, by several assignments, urges as error the action of the trial court in rendering judgment against him because the uncontróverted testimony shows that the ap-pellee listed his property with appellant for sale or exchange, and promised that, if he found a party with whom an exchange was made, he would pay appellant 2½ per cent, commission on the exchange value agreed up^ on between appellee and such party, and 5 per cent, on the price received by appellee in excess of such agreed exchange value; that appellant found such party in the person of J. W. Evans, who was accepted by ap-pellee, and a binding written contract for tbe exchange of their respective properties was made and executed by appellee and said Evans.

The appellant testified in substance that the appellee listed his property with him for sale or exchange; that appellee promised to pay him 5 per cent, commission on a sale and for an exchange deal per cent, on the exchange value of the property received by appellee and 5 per cent, on the price secured in excess of the value of the property accepted in exchange; that this was the usual and customary price, and was a reasonable charge for such services; that through a real estate broker, Mr. T. L. Dulce of San Angelo, he got in touch with Mr. Evans as a probable customer; that he and Mr. Duke arranged to show, and did show, the property of appellee to Mr. Evans, and that he carried the appellee to Lampasas county and showed him Mr. Evans’ ranch; that thereafter they brought Mr. Evans to Tahoka, Tex., and he and Mr. Kelt-ner made the trade and entered into the written contract for the exchange of their properties ; that at the time the contract was entered into the appellee knew that the ranch was jinder lease and understood the tenant was claiming damages for some fencing. That was all explained, and Mr. Evans was to straighten it out.

The contract, so far as necessary to a disposition of this appeal, provided for the exchange of the ranch property óf Mr. Evans in Lampasas county for the real estate of the appellee in Tahoka, Tex. It recites the agreed value of the respective properties, the incumbrances against each, and that each party accepts the property of the other subject'to the incumbrances against it, and that the appellee, in addition to the exchange value of the property he received, is to accept a vendor’s lien note against the property to be conveyed to Evans for the sum of $5,000. The contract provides that each party is to furnish abstract showing good and valid title, for the correction of any defects; that Evans’ property is under lease, which continues for two years after November 1, 1929, and is to be conveyed to appellee subject to said lease, and the rent accruing thereunder to be received by appellee after November 1, 1929.

The contract contains this provision: “If either party hereto fails or refuses to complete and perform all the conditions of this contract, he agrees to pay to the other party not. at fault the sum of $3,000.00 as liquidated damages, as it is impossible to determine just what the damages for breach of said contract. would be.”

The testimony shows that appellee and Mr. Evans were brought together by appellant and Mr. Duke; that they entered into the contract for the exchange of their respective properties; that the time for the consummation of the deal as stipulated in the contract was extended by mutual agreement of the parties, and that the provision in the contract relative to liquidated damages for the breach thereof was by mutual consent canceled; that the tenant on the Evans ranch was holding under a written lease 'from A. O. Allen and Mattie Sanderson, the grantees of Mr. Evans; that the tenant was claiming that his lessors had failed to comply with the lease contract for which the tenant was claiming damages; that the tenant advised appellee of such claim, and that he intended to hold possession of the ranch until such damages were paid; that, on account of the tenant’s claim that the lessors had failed to comply with the lease contract tor the ranch, appellee stated he was turning the ranch down, as the lease would have a $5,000 loan against it at the time it expired; that, on receipt of this information, Mr. Evans wrote the appellee that he understood that appellee wanted to call the trade off! and he could not blame him, in reply to which letter appellee’s attorney advised Mr. Evans that it would be all right to call the trade off without liability against either party and consider the matter closed, and that, if Evans would release the appellee from any damages that he might think he had in the matter, the contract would be forgotten as a thing of the past; that, after this letter was sent and received,. Mr. Evans and the appellee considered the exchange contract canceled and of no further force and effect. Mr. Evans testified that he was in a position to go ahead and' close up the trade if Mr. Keltner had stayed with it and was in a position to deliver the title within the time covered by the extension agreement, which was oral.

The statement of facts shows that “it is agreed by the parties hereto that the value of the property agreed to be exchanged was as set out in the written contract offered in evidence.”

The court finds that, at the time the contract of exchange was made, the plaintiff and Mr. Evans were informed by the appellee that he “wanted to know that there was no trouble sheet attached to the property that they proposed to exchange.” This finding is substantially the language used by appellee while testifying as a witness in his own behalf. He made no explanation of what he meant by such statement, but the court interprets his meaning to 'be that he was not interested in exchanging for property where there was any question about the title or possession. This testimony and the finding of the court thereon, together with appellant’s evidence that the claim of the tenant for damages was fully explained at the time the contract was made and that Mr. Evans was to adjust the tenant’s claim for damages, we think clearly shows that appellee had notice of the claim of the tenant at the time the contract was executed, and that appellee accepted and relied on Mr. Evans to adjust the claim with the tenant; Uiat appellant acted in good faith, and disclosed all the information he had relative to such claim. The record shows that appellant was in no way responsible for the failure of Mr. Evans to adjust this controversy ' with his tenant, and was in no way responsible for the abandonment of the exchange contract by Mr. Evans and the appellee.

The appellee contracted that the land should be conveyed to him subject to this lease contract. The lease contract gave the tenant no lien' against the ranch, and in no way incumbered the title thereto for any claim the tenant might have for damages because of the failure of his lessors to comply with their contract to build a fence, and' the tenant could not have held possession of the ranch for a length of time greater than the lease contract provided.

The court finds that J. .W. Evans was not at any time ready, willing, and able to exchange his property for the property of appellee, and that appellee offered to perform his part of the agreement, and would have done so except for the default of Mr. Evans. He concludes as a matter of law from such finding that appellant was not entitled to recover.

In our opinion, the testimony is insufficient to support these findings, but, if such findings .were warranted from the evidence, they would not be a defense to appellant’s claim for his commission, because the testimony shows that appellant was employed to find a party with property acceptable to appellee and with whom appellee was willing to contract for an exchange of his property on terms and conditions agreed upon between such party and the appellee; that appellant found J. W. Evans, interested him in the exchange, brought him and appellee together, and they entered into a valid contract on terms and conditions satisfactory to each of them for the exchange of their properties.

The court concludes as a matter of law that the contract was not capable of specific performance on account of the liquidated damage clause contained therein, and, because of this and his finding that Mr. Evans was not ready, willing and able to comply with the terms of the written contract, the appellant is not entitled to recover.

The record discloses that appellant was not authorized by appellee in the listing contract nor at any other time to make any price, any terms, or any conditions upon which an exchange would be made; that he was in no way responsible for the damage clause or any other clause contained in the contract. It will be noted that the liquidated damage clause does not bind either of the parties to the contract to accept the $3,000 provideá therein as liquidated damages in lieu of specific performance, but, if it did, appellant had no authority to have such provision eliminated.

“A broker is entitled to compensation when he procures a purchaser with whom his principal is satisfied, and who actually contracts for the property at a price satisfactory to the owner.” Conkling v. Krakauer, 70 Tex. 735, 11 S. W. 117, 118.

“When the seller enters into a binding contract with a purchaser acceptable to him, the seller assumes the risk as to whether or not the purchaser will be in position to perform his part of the contract, and that when such contract is so entered into by the seller the agent has performed all the duties that he can perform under his employment.” Francis et al. v. Foster, 113 Tex. 521, 260 S. W. 1023.

“A commission ordinarily becomes payable on completion of the transaction which the broker was employed to negotiate, unless there is a stipulation in the contract of employment to the contrary. If by the contract of employment the broker is merely to find a customer who is able, ready and willing to enter into a transaction with the principal on the terms prescribed by him, the broker is entitled to compensation on performing that service, whether or not the principal completes the transaction. Thus a broker employed to find a purchaser or a vendor or to exchange lands ordinarily becomes entitled to a commission on the execution of a contract of purchase or sale or exchange, although without any fault on the part of the broker the contract is never carried out, unless there is a stipulation, express or implied, making his right to compensation depend on the performance of the contract or the happening of some other event.” 9 C. j. 591, § 86.

This announcement of the law is quoted with approval by the Commission of Appeals in Stevens v. Karr, 33 S.W.(2d) 725.

The provision in the contract for liquidated damages was to assist either, party in enforcing specific performance by the other, and did not give either party the right to forfeit the contract by the payment of the amount therein provided. Jones v. Parker (Tex. Civ. App.) 26 S.W.(2d) 742, and authorities therein cited.

For additional authorities see Kitchen v. Lloyd (Tex. Civ. App.) 14 S.W.(2d) 335; Stolaroff v. Campbell (Tex. Civ. App.) 18 S.W.(2d) 838; Spring v. R. N. Burt Land Co. (Tex. Civ. App.) 25 S.W.(2d) 670.

Neither the appellee nor Mr. Evans saw fit to enforce his rights to specific performance, but, before the abstracts of title had been furnished and examined, and before any defects in title had been pointed out, the parties mutually agreed, first, to abrogate the liquidated damage clause of the contract and later to cancel and abandon the entire contract for the exchange of properties.

We do not feel that under the facts revealed by this record and the findings of the trial court we are authorized to reverse and render. The judgment is therefore reversed, and the cause remanded.


source: Caselaw Access Project

author: DUNKLIN, J.

license: Public Domain

text:
    SMITH et al. v. JACKSBORO STONE PRODUCTS CO.
    No. 12494.
    Court of Civil Appeals of Texas. Fort Worth.
    June 27, 1931.
    Rehearing Denied July 18, 1931.
    Worsham, Rollins, Burford, Ryburn .& Hindis, of Dallas, for National Surety Co.
    W. L. Scott, of Graham, and F. L. Henderson and R. V. Armstrong, both of Bryan, for Allen Smith and another.
    Marshall & King, of Graham, and Dick Dresser, of Seymour, for appellee.
   DUNKLIN, J.

"Allen Smith and the American Surety Company of New York have appealed from a judgment in favor of Q. L. Meetze and L. P. Lively, composing the partnership firm of the Jacksboro Stone Products Company, plaintiffs, for the sum of $1,270.27, for material furnished to Allen Smith for construction of a highway in Young county and designated, as federal aid project No. 441-B.

Allen Smith was the original contractor to do the work, and he sublet a part of the work to Paul Schriewer. The material for which plaintiffs sued was furnished upon the order of Allen Smith, acting through his duly authorized agents, but was . used by Paul Schriewer in doing the work which he had undertaken as subcontractor.

An itemized account of the material furnished, consisting of 20 carloads,, was attached to the plaintiffs’ petition, and showed a sale and delivery of 20 cars on divers dates, ■beginning May 10, 1920, and ending June 13, 1929. The state highway department, through Gibb' Gilchrist, the state highway engineer, and R. G. Williams, superintendent of the federal aid project, were notified by the plaintiffs of the amount of their 'claim against the contractor prior to a final settlement with the latter for the work done. . In order to collect the balance due on the contract, Allen Smith executed to the plaintiffs and other claimants the following bond, in accordance with the provisions of article 5472b —1, Vernon’s Ann. Tex. Civ. Statutes, which was Senate Bill No. 153, of the Acts of the 41st Legislature, adopted in 1929, Second Called Session (chapter 78), which reads as follows:

“State of Texas, County of Travis:
“Know all men by these presents: — That I, Allen Smith, of Bryan, Texas, as principal, and the American Surety Company of New York, a New York corporation, duly authorized under the Ihws of Texas to execute bonds or sureties, are held and firmly bound unto the following Claimants, to wit: Jacksboro’ Stone Products Company, Jacksboro, Texas; D. T. Carter, Graham, Texas; Allen and Copeland, Peed & Grain Company, Graham, Texas; Porter Bros, c/o McFarland & McFarland, Attys., Graham, Texas; Jess Wright, c/o McFarland & McFarland, Attys., Graham, Texas; Shamrock Motor Company, Graham, Texas; McClung Construction Company, Ft. Worth, Texas; Graham Welding and Machine Company, Graham, Texas; E. D. Smith, Graham, Texas; Farmers Milling Company, Graham, Texas; Auto Machine Company, Graham, Texas; Givens Machine Shop, Graham, Texas; G. B. Johnson Hardware (company) agt. Graham, Texas; Graham Refining & Fuel Company, Graham, Texas; Young County Lumber Company, Graham, Texas ; Pierce Petroleum Corporation, c/o Cantey, Hanger & McMahon, Fort Worth, Texas; Edward Lisle Tin Shop, Graham, Texas; The Texas Company, Dallas, Texas; and J. E. Mclntire, Graham, Texas, in the full and just sum of, Forty Six Thousand Eight Hundred Twenty-Nine' and 16/100 (⅜46,829.16) Dollars, which sum' is twice the amount of all moneys due on Federal Aid Project No. 441-B, Young County, Texas, and remaining to be paid by the State Highway Department of Texas for all labor, materials and work performed covering every item of cost involved on this project remaining to bo paid, to the payment whereof we bind ourselves, our executors, administrators, successors, and assigns, jointly and severally, firmly by these presents.
“Sealed with our seals and dated this 2nd day of August, 1929.
“Whereas: — A recent enactment of the Legislature of the State of Texas, identified as Senate Bill No. 153, requires contractors to file bond to release and discharge liens, or attempt to fix liens, on work under construction for the State, or any county, town or municipality in the state for any moneys that may be due contractors.
“Whereas, the above listed claimants have attempted to fix a lien or liens against any or all moneys that might be due on said Federal Aid Project No. 441-B, Young County, Texas, for work performed on this project for the State Highway Department of Texas;
“Now therefore, the condition of this obligation is such that if the said principal shall pay all the money remaining due on this project, towit, Twenty-Three Thousand Four Hundred Fourteen and 58/100 ($23,414.58 Dollars, wherever justly due or severally as their interest may appear, or such portion or portions thereof as may be proved to be liens and due by said principal under the terms of chapter 17, General Laws of the State of Texas, passed by the regular session of the 39th Legislature of the State of Texas, and shall pay all costs adjudged against the principal in actions that may be brought by the above listed claimants, then this obligation shall be void, otherwise to remain in full force and effect.
“Allen Smith, Principal,
“American Surety Company of New York,
“By W. T. Decherd, Res. Vice Pres.
“Attest: D. T. Anderson, Res. Asst. Secy.”

That act of the Legislature appears in Vernon’s Ann. Tex. Civ. Statutes as article 5472b — 1, and reads as follows:

“Sec. 1. That whenever any claim or claims shall be filed attempting to fix a lien, secured or claimed by any instrument filed under the provisions of Chapter 17, of the General Laws of the State of Texas, passed by the Thirty-ninth Legislature in Regular Session, that the contractor or contractors against whom such claim or claims are made, may file a bond with the officials of the State, county, town or municipality whose duty it is to pay the moneys, bonds or warrants to such contractor or contractors. Said bond shall be double the amount of the claims filed, and shall be payable to the claimant or claimants. It shall be executed by the party filing same as principal, and by a corporate surety authorized under the laws of Texas to execute such bond as surety, and shall be conditioned substantially that the principal and surety will pay to the obligees named, or their assigns, the amount of the claim or claims, or such portion or portions thereof as may be proved to have been liens, under the terms of Chapter 17, General Daws of the State of Texas, passed by the Regular Session of the Thirty-ninth Legislature. The filing of said bond and its approval by the proper official of the State, County, town or municipality, shall release and discharge all liens fixed or attempted to be fixed by the filing of said claim or claims, and the official or officials whose duty it is to pay the moneys, bonds or warrants shall pay or deliver the same to the contractor or contractors or their assigns. Said official shall send by registered mail an exact copy of said bond to all claimants.
“Sec. 2. At any time within six months from the date of filing of said surety bond, the party making or holding such claim or claims may sue upon such bond, but no action shall be brought on such bond after the expiration of such period. One action upon said bond shall not exhaust the remedy thereon, but each obligee or assignee of an obligee named therein may maintain a separate suit thereon in any court and in any jurisdiction. If any claimant or claimants in an action establish the fact that they were entitled to a lien under the provisions of Chapter 17 of the General Daws of the State of Texas, passed at the Regular Session of the Thirty-ninth Legislature, and shall recover judgment for not less than the full amount for which claim was made, the court shall fix a reasonable attorney’s fee in favor of the claimant or claimants, which shall be taxed as part of the costs in the case.. The bond provided in Section One of this Act shall also be conditioned that the principal and surety will pay all court costs adjudged against the principal in actions brought by claimant or claimants thereon.”

After that bond was given, Allen Smith drew down the money due for the work. This suit was instituted by plaintiffs to recover under the obligations of that bond.

The record shows that the contract for the work was awarded to Allen Smith in 1928, while article 5160, Rev. Civ. Statutes, as amended by the First Called Session of the Fortieth Legislature, 1927 (chapter 39, § 1 (Vernon’s Ann. Civ. St. art. 516.0 note), was in force, but there is no showing in this record of a giving by Allen Smith of the bond required by that act of the Legislature'.

Articles 5472a and 5472b, Vernon’s Ann. Tex. Civ. Statutes, passed by the Thirty-Ninth Legislature (see Acts 1925, chapter 17, p. 44, §§ 1 and 2), read as follows:

“5472a. That any person, firm or corporation, or trust estate, furnishing any material, apparatus, fixtures, machinery or labor to any contractor for any public improvements in this State, shall have a lien on the moneys, or bonds, or warrants, due or to become due to such contractors for such improvements; provided, such person, firm, corporation, or stock association, shall, before any payment is made to such contractor, notify in writing the officials of the State, county, town or municipality whose duty it is to pay such contractor of his,claim.
“5472b. That no public official, when so notified in writing, shall pay all of said moneys, bonds or warrants, due said contractor, but shall retain enough of said moneys, bonds or warrants to pay said claim, in case it is established by judgment in a court of proper jurisdiction.”

Plaintiffs having given notice to the state highway department of their claims for the material furnished before final settlement with Allen Smith, the contractor, a lien was established in their favor on the unpaid balance due Smith on his contract, under the provisions of article 5472a, copied above. And Allen Smith and the American Surety Company were liable to the plaintiffs under the very terms of the bond given to plaintiffs and other claimants for the amount due them respectively.

it is of no moment that some of the cars were delivered to Paul Schriewer, the subcontractor, rather than to Allen Smith, since those shipments, as well as the others, were used to carry out Allen Smith’s contract to do the construction work, and those deliveries were with his consent and acquiescence. As pointed out in the opinion of Justice Alexander, of the Waco Court of Civil Appeals, in Texas Co. v. Schriewer, 38 S.W.(2d) 141, the statutory lien for labor and materials furnished for a public improvement given in article 5472a attaches when furnished to a subcontractor to the same extent as when furnished to the original contractor, since the language “any contractor” used in that article is enough to cover both the original and subcontractor, and evidently was employed in that sense. And we also concur in the further conclusion reached in that case, to the effect that the lien given by that statute attaches to any balance due the contractor at the time notice of a claim for labor or material furnished is given to the official of the' state, county, town, or municipality whose duty it is to pay -the contractor; and that the state highway commission wa.s the proper party to receive such notice as recognized by the letter of the state highway engineer, of date August 3, 1929, addressed to plaintiffs, inclosing a copy of the release bond referred to above, with the statement that same had-been filed in the state highway department by Allen Smith, and also acknowledging the filing by plaintiffs of their claim with that department under the provisions of chapter 17, Acts of the Thirty-Ninth Legislature, same being article 5472a, noted above. And not only did plaintiffs file notice of their claim with the highway commission within the time fixed by that statute, but they also instituted this suit on the release bond within the period fixed by section 2 of article 5472b — 1.

While plaintiffs’ petition was not as full as it should have been, yet we believe it sufficient as against a general demurrer.

Accordingly, all assignments of error by appellants Allen Smith and the American Surety Company of New York are overruled, and the judgment as against them in favor of the plaintiffs is affirmed.

After Allen Smith had procured the contract from the state highway commission for the paving of the highway, he sublet the surfacing of same to Paul Schriewer, who executed to him a written contract to do that work and also the following bond:

“Contractor’s Bond.
“Know all men by these presents: That we, Paul Schriewer of Seguin, Guadalupe County, and State of Texas, as principal and National Surety Company of New York, N. Y., as surety, are held and firmly bound unto Allen Smith, in the penal sum of Sixty Three Thousand Five Hundred Sixty Six & 28/100 ($63,-560.28) lawful money of the United States, to be paid to said State of Texas for which sums of money, well and truly to be paid, we bind ourselves, our heirs, successors, executors, and ■ administrators, jointly and severally, firmly by these presents.
“Sealed, with our seals and dated this 20 day of April, A. D. 1928.
“The condition of this obligation is such that if the said bounden principal Paul Schriewer shall in all things well and truly perform all the terms and conditions of the foregoing contract, to be by them (him) performed, and with the time therein mentioned and shail pay all lawful claims for labor performed and material furnished in and about the construction of said road, bridge, and shall have paid and discharged all liabilities for injuries which have been incurred in and about the construction, under the operation of the Statutes of the State, then this obligation is to be void; otherwise to be and remain in full force and virtue.
“Done in the presence of: A. S. Bryan
“Paul Schriewer [Seal]
“National Surety Company
“By O. H. Verschorle
“Resident Vice-Presideht.
“Attest: 1780. — Hubert L. Puckett Resident
Asst. Secretary.”

Allen Smith and the American Surety Company of New York, in addition to the pleas filed in answer to plaintiffs’ suit, interpleaded Paul Schriewer and the National Surety Company of New York, and sought a recovery against them on Paul Schriewer’s contract and his bond, set out above, for whatever sum that plaintiffs might recover against Allen Smith and the American Surety Company. Although Paul Schriewer was named in that plea over as a defendant to the cross-action, no service was had upon him, and upon the trial of the case he was dismissed. The National Surety Company filed a plea of privilege to be sued in Dallas county, the place of its domicile, which was in strict compliance with the statutes in such cases made and provided. That plea of privilege was overruled, and judgment was rendered against the National Surety Company in favor of Allen Smith and the American Surety Company for the sum of $570.92, with costs of suit. The National Surety Company has appealed from the judgment overruling its plea of privilege and also the judgment for the sum mentioned.

Article 1995, Rev. Civ. Statutes of 1925, by Acts of the First Called Session of the Fortieth Legislature (1927), c. 72, § 2 (Vernon’s Ann. Civ. St. art. 1995, subd. 29a), was amended by adding thereto the following:

“29a. (Two or more defendants.) Whenever there are two or more defendants in any suit brought in any county in this State and such suit is lawfully maintainable therein under the provisions of Article 1995 as to any of such defendants, then such suit may be maintained in such county against any and all necessary parties thereto.”

This suit was instituted in Young county, as was also the plea over against the National Surety Company. The plea of privilege showed that the National Surety Company’s residence and principal place of business'was in Dallas county, and there was no proof offered to controvert that fact. The failure to get service on Paul Schriewer of the plea over, and going to trial on that plea without such service, was equivalent to an abandonment of the cross-action against Paul Schrie-wer with the same legal effect as if he had never been sued at all.

By article 1987, it is provided that a surety or other party conditionally liable on a written contract may be sued alone or without making the principal obligor a party, “when the principal obligor resides beyond the limits of the State, or where he cannot be reached by the ordinary process of. law, or when his residence is unknown and cannot be ascertained by the use of reasonable diligence, or when he is dead, or actually or notoriously insolvent.”

None of those exceptions were alleged in the plea over against the National Surety Company. On the contrary, Paul Schriewer was alleged to reside in Guadalupe county, Tex.

Under the common-law rule, and in the absence of that statutory provision, Paul Schriewer was a necessary party defendant to the cross-action on the bond executed by him and the National Surety Company of New York to Allen Smith, and therefore venue was not shown against the National Surety Company under exception 29a oi article 1995; and hence the cour.t erred in overruling the plea of privilege by the National Surety Company and in rendering judgment against it.

Accordingly, the judgment of the trial court overruling the plea of privilege and decreeing a recovery against the National Surety Company is reversed, and judgment is here rendered sustaining the plea of privilege and remanding that portion of the case involving the plea over against Paul Sehriewer and the National Surety Company to the trial court, with instructions to transfer that cross-action to the district court of Dallas county and to .make the orders necessary thereto as prescribed by the statutes in such cases made and provided.

All costs of this appeal are attached against Allen Smith and the American Surety Company.


author: CONNER, O. J.

text:
    In re GREER et al.
    Court of Civil Appeals of Texas. Fort Worth.
    May 30, 1931.
    Henry Young, of Fort Worth, for relators.
   CONNER, O. J.

We are of the opinion that this application must be denied for want of equity in the petition, in two particulars:

(a) While the application states that an appeal bond had been given, it fails to state the amount thereof, or that it had been approved by the clerk, as required by article '2265, of the Revised Statutes, and, for aught that appears on the face of the petition, it may have been upon this ground that the clerk complained of refused to make up the transcript. It is true the petition states that the refusal was “without probable cause and with the wilful, wicked and malicious intent and purpose to deprive plaintiff, the said Mrs. Alice P. Greer et al., of her constitutional and legal right to have redress in all of the courts of this state for wrongs done her in her lands and improvements,” etc. But these allegations amount to no more than mere conclusions, whereas, in an application for mandamus, the necessary facts as contra-distinguished from opinions should be clearly stated.

(b) The petition shows that the order complained of is an order of the trial court granting the defendant Union Life Insurance Company leave to file its plea to make the Great Southern Life Insurance Company party defendant in the cause, and that, after the plea had been presented and heard by the court, it was ordered that it be granted, to which the applicant for the writ of mandamus complained for the reasons therein set forth. Whereupon, the court “entered an order on the docket of said court to that effect, to which ruling plaintiff, Mrs. Alice P. Greer et al., by counsel, excepted and served notice upon defendants, said Southern Union Life Insurance Company et al., and said court, that plaintiff, the said Mrs. Alice P. Greer et al., would not prosecute this cause any further in said court with the said Great Southern Life Insurance Company as party defendant in this cause by virtue of the aforesaid plea. Thereupon the said court entered final judgment in this cause upon the docket of said court, to which order applicant excepted and gave notice of appeal,” etc.

In Texas Jurisprudence, vol. 3, p. 126, §• 62, it is said: “An interlocutory judgment or order is one made during the pendency of an action, which does not dispose of the case, .but leaves it for further action by the court in order to settle and determine the entire controversy.”

• And on the preceding page, and in the preceding section (61), it is further said: “Unless specifically made so by statute, an interlocutory judgment or order is not appealable, and is reviewable only after final judgment has been rendered; an attempted appeal from such order will be dismissed for want of jurisdiction,” etc.

It seems quite clear that the order of the district court making the Great Southern Life Insurance Company a party defendant on the application of the Southern Union Life Insurance Company is but an interlocutory order or judgment, and we know of no statute which gives this court jurisdiction' or power to review and pass upon the objections the applicant herein, by her counsel, made to the proceeding, and the declaration of counsel to the court that he would refuse to further prosecute the suit with the additional party, as had been ordered by the court, must be given the effect of a voluntary nonsuit, which the plaintiff in a cause at any time is at perfect liberty to take, and of which the defendants have no right to complain in the absence of a pending cross-plea of which the court has jurisdiction.

Accordingly, as stated in the beginning, we think the applicants’ petition for writ of mandamus fails to show a legal or equitable right for issuance of the writ. The application is therefore denied.


author: BLAIR, J.

text:
    HOUSTON &. T. C. RY. CO. et al. v. CITY OF HOUSTON.
    No. 7604.
    Court of Civil Appeals of Texas. Austin.
    June 24, 1931.

      , Baker, Botts, Andrews & Wharton and Arterbury & Coolidge, all of Houston, for appellants.
    Sam Neathery, Oity Atty., William D. Orem and Paul D. Page, Jr., all of Houston, for ap-pellee.
   BLAIR, J.

Appellee, the city of Houston, instituted this proceeding to condemn a strip of land 40 feet wide and 70 feet long for street purposes across the right of way of appellant Houston & Texas Central Railway Company.

Houston Heights, an addition to appellee, is bounded on the south by appellant’s right of way. Heretofore there has been but one thoroughfare, Heights boulevard,• to the city proper, by way of Washington avenue. Yale street in Houston Heights runs parallel with ■Heights boulevard, but heretofore has not extended as far south as appellant’s right of •way; and appellee sought to open and extend Yale street' across appellant’s right of way and into Washington avenue. Both parties appealed from an award by the commissioners appointed to assess the damages. A jury trial in the county court resulted in judgment granting appellee a perpetual easement for street purposes across appellant’s right of way; but as regards damages the jury answered, “None,” to the' following special issue submitted: “What sum of money, if any, do you find to be the lessened value, if any, of the right of the defendants to use their railroad tracks over the land described in plaintiff’s petition, caused by the opening and use of Yale Street there over?”

Judgment was accordingly rendered that appellant take nothing as damages or consideration for the easement granted appellee; hence this appeal.

It is the contention of appellant that the special issue submitted limited its recovery solely to the “lessened value” of its right of way to use its “tracks,” caused by the opening and use of Yale street thereover; whereas, the measure of “compensation generally applied when a public thoroughfare is laid out across a railway right of way is the diminished value for railway purposes of the company’s exclusive use of the land taken, caused by its use for street purposes.” 24 L. R. A. (N. S.) 1229. And mbre specifically appellant insists that the value of its right to exclusive use of its entire right of way where Yale street crossed it, lay not alone in the right to use its “tracks,” as submitted in the special issue, but that such value lay in its right, as follows:

(1) To build and maintain its sidings and switches where it wished them to be.

(2) To keep its tracks and sidings at whatever grade was best fitted to its purpose.

(3) To be able to operate its trains and conduct its switching operations along its right of way without being hampered by public trafile across same.

(4)To use the land taken for street purposes on which to store ears, rails, cross-ties, and other equipment, or for any uses incident to an unincumbered fee in the premises.

In support of these elements or special items of'damages pleaded, appellant offered to prove that a change in grade to place its right of way suitable for the street use would cost $350; that plating the crossing would cost $2,376; that installing electric crossing gates as required would cost $4,000; that it would be put to an increased switching .expense of $20,000; and that the necessary remote controls of the crossing would cost appellant $12,000. The trial court excluded this proffered testimony on the ground that the ordinances -of the-city of Houston required appellant to do these specific things without compensation.

Under the ordinances of the city of Houston, it had the power to direct the opening and placing in condition for street use the portion of the right of way in question, and to compel appellant to do many of the things for'which it seeks damages, without any compensation.

Section 266 of the Revised Code of Ordinances of the city of Houston provides as follows: “It is hereby made the duty of all railroad companies and managers thereof owning or controlling steam railroads in the Oity of Houston, and operating trains thereon, to provide crossings easy of access and suitable for the use of street trafile. Said crossings shall be constructed of vitrified brick, or other permanent paving material, satisfactory to the Oity Engineer. Said crossings must be so constructed as to be easy of access and reasonably smooth. When brick ’is used, same must be laid on a five-inch (5) concrete foundation, under the supervisioh of the Oity Engineer, and to the satisfaction of the Mayor of said city.”

Section 267 provides the time within which railroads must construct crossings after lawful notice to do so.

Section 261 provides as follows: “It shall be the duty of each railway company whose lines of road are constructed, or may be hereafter constructed, within the corporate limits of the City of Houston, to put in good repair and maintain in good condition all streets or parts of streets through or over which its line of road may run, and to keep the same free from obstruction of every kind, which said repairs shall be made and constructed under the direction and supervision of the Street and Bridge Commissioner and City Engineer.” ;

Section 260 provides that railroads must make necessary drainage over or across any street on which their lines are now or may hereafter be constructed, and to furnish all necessary culverts, ditches, waterways, etc., necessary, under supervision of the city’s engineer.

Section 248 requires railroads to safeguard any street or sidewalk crossed hy their track or tracks; and section 250 provides that expenses of safeguarding crossings shall be borne by the railroads.

Sections 239 and 252 provide that 'railroad companies shall light crossings by proper or electric lights, and provide a penalty for failure to do so.

Section 238 provides that railroad companies shall keep flagmen at all crossings designated by the city.

These ordinances have the effect of statutes and make it the duty of every railroad company operating a railroad within the corporate limits of the city of Houston to place and keep in repair such portions of its right of way as found to be reasonably necessary and convenient for public streets; and no railroad company can demand compensation for doing those things which the,ordinances require it to do, such as changing its grade to make it suitable for street purposes, plating the crossing, installing electric lights, or electric crossing .gates, and safeguarding the crossing as provided in the ordinances. Nor are these requirements without compensation in violation of the constitutional prohibitions against taking private property for public use without due compensation.

In the case of Chicago, B. & Q. Ry. Co. v. Chicago, 166 U. S. 252, 17 S. Ct. 581, 590, 41 L. Ed. 979, the following language is used by Justice Harlan: “The plaintiff in error took its charter subject to the power of the state to provide for the safety of the piublic, in so far as the safety of the lives and persons of the people were involved in the operation of the railroad.. The company laid its tracks subject to the condition, necessarily implied, that their use could be so regulated .by competent authority as to insure the public safety. And qs all property, whether owned by private persons or by corporations, is held subject to the authority of the state to regulate its use in such manner as not to unnecessarily endanger the lives and the personal safety of the people, it is not a condition of the exercise of that authority that the state shall indemnify the owners of property for the damage, or injury resulting from its exercise. Property thus damaged or injured is not, within the meaning of the constitution, taken for public use, nor is the owner deprived of it without due process of law. The requirement that compensation be made for private property taken for public use imposes no restriction upon the inherent power of the state by reasonable regulations to protect the lives and secure the safety of the people.”

This rule was approved in the case of Gulf, C. & S. P. Ry. Co. v. Milam County, 90 Tex. 357, 38 S. W. 747, in which the statute requiring every railroad company to place and keep in repair at its own expense that portion of its right of way embraced in the county road "was construed, and in which Judge Brown used the following language:

“In the exercise of its police power, the legislature had the authority to require railroad companies to make and keep in repair the crossings of public county roads over and upon their railroads and their right of way. Railway v. Rowland, 70 Tex. 307, 7 S. W. 718; State v. Railway, 29 Neb. 412, 45 N. W. 469; Railway v. Commissioners, 79 Me. 386, 10 A. 113; Railway v. Deering, 78 Me. 61, 2 A. 670 [57 Am. Rep. 784].
“The law required this railroad company to place and keep in repair that portion of its road and right of way embraced in the county highway át the point of intersection, and, ’in the discharge of that and other duties imposed upon it by the law, the railroad company might be compelled to do all of the things for which it claimed damages in this case. But it cannot be held, under the statute, that the county must compensate the railroad company for doing those things which the law required it to do, although that duty arose out of the fact that the county highway was laid out across the railroad.
“Counsel for the appellant in this case admits that, after the crossing was once constructed, the railroad company must keep it in repair. The statute says that the railroad .company shall ‘place’ it in a safe condition, and shall keep it in such condition; and this, in the absence of other provisions, necessarily imposes upon it the duty of constructing the crossing in the first instance, as well in those cases where the county road is laid out subsequently to the building of the railroad as in cases where the county road existed before the railroad was constructed.”

In the case of Houston & T. C. Ry. Co. v. City of Dallas, 98 Tex. 413, 84 S. W. 648, 652, 70 L. R. A. 850, Judge Williams quotes with approval the above quotation from Chicago, B. & Q. Ry. Co. v. Chicago, and uses this further language:

“There is some conflict among the authorities as to what a railroad company may be required to do at its own expense in the construction of crossings, but the weight of authority sustains the views expressed by Mr. Justice Harlan, and such is the position of this court. Gulf, C. & S. F. Ry. Co. v. Milam County, 90 Tex. 357, 38 S. W. 747; Gulf, C. & S. F. Ry. Co. v. Rowland, 70 Tex. 303, 7 S. W. 718.
“The conflicting cases have arisen when new streets or other highways were being-opened across existing railroads, and the question was as to the extent to which compensation must be made to the railway companies. All of the courts agree that the companies are not entitled to be paid the expense of doing those things which may properly be required of them by virtue of the police power to secure the safety of persons using the crossings, but differ as to what things are within that category.”

These authorities clearly dispose of the question that appellant is not entitled to compensation for .placing and beeping its right of way in condition for the street crossing, such as making and keeping proper grades,- plating crossing, paving same if directed by city, maintaining lights, electric gates, .safeguards, and flagmen, if directed by the city so to do, and the making of necessary drainage ditches, etc., because they constitute a reasonable exercise of the police power of the city of Houston, and are constitutional, although enacted after the railroad was built. We theréfore pass to the consideration of the alleged increased operating expenses as an element of damages, and which element of damages was not considered by the Supreme Court in either of the cases above cited, but which was considered and held not authorized in Chicago, B. & Q. Ry. Co. v. Chicago, supra. The general rule is stated in 24 L. R. A. (N. S.) 1231, as follows: “The fact that the public will acquire the right to occupy the right of way while crossing it, thereby increasing the company’s operating expenses, is too speculative and uncertain to base damages upon, as such inconvenience will be due to the observance of necessary police regulations. Lake Shore & M. S. R. Co. v. Chicago, 148 Ill. 509, 37 N. E. 88; Chicago & N. W. R. Co. v. Chicago, 140 Ill. 309, 29 N. E. 1109; St. Paul, M. & M. R. Co. v. Minneapolis, 35 Minn. 141, 27 N. W. 500; Little Miami & C. & X. R. Co. v. Dayton, 23 Ohio St. 510; Southern Kansas R. Co. v. Oklahoma City, 12 Okl. 82, 69 P. 1050.”

And while there is authority to the contrary, we think this rule is in harmony with the reasoning in Gulf, C. & S. F. Ry. Co. v. Milam County, and Houston & T. C. Ry. Co. v. City of Dallas, supra, because the inconveniences and expenses due to increased operations after the opening of the street across the right of way would be largely due to observation of the necessary police regulations, and therefore not compensable.

Nor do we think appellant entitled to damages for its claimed right to store “other equipment or for any uses incident to an unencumbered fee” in the portion of the right of way crossed by the street. Damages based upon the possible imaginary or probable future use of its right of way where crossed by the street cannot be allowed appellant. Chicago, B. & Q. Ry. Co. v. Chicago, supra; New York, C. & St. L. R. Co. v. Rhodes, 171 Ind. 521, 86 N. E. 840, 24 L. R. A. (N. S.) 1230.

Nor was appellant entitled to compensation for interruption or interference in its switching operations and in having to slow down its trains for the Yale street crossing. These are inconveniences caused by observation of necessary police regulations for the safety of the life and property of the public using the street crossing, and for which no compensation is allowable. Chicago, B. & Q. Railway v. Chicago, supra; New York, C. & St. L. R. Co. v. Rhodes, 171 Ind. 521, 86 N. E. 840, 24 L. R. A. (N. S.) 1231.

But appellant insists that in the exercise of its right of eminent domain the city of Houston was under necessity of making compensation, the measure of which was the diminished value for railway purposes of the exclusive use of its entire right of way, caused by its use for street purposes; and that failure of the jury to find and the court to render judgment for damages under the facts pleaded and proved brings the case within the constitutional inhibition against taking or damaging private property for public use without compensation.

The measure of damages contended for by appellant is in accord with the great weight of authority. New York, C. & St. L. R. Co. v. Rhodes, 171 Ind. 521, 86 N. E. 840, 24 L. R. A. (N. S.) 1229, and cases cited in footnote. Such was the measure of damages approved in Chicago, B. & Q. Railway v. Chicago, supra, which authority both Judge Brown and Judge Williams cited with approval. And we think the court erred in limiting appellant’s damages in the special issue submitted to the diminished value of the right of way to use the “tracks,” caused by the opening and use of Yale street thereover.

Appellant pleaded and proved that it would be compelled to remove a switch stand from its right of wa.y, where Yale street crossed it, at an expense of $300. It also pleaded and proved that heretofore it had used its right of way where Yale street would cross it as a switching yard, and had used the land between the tracks on which to store cars, rails, cross-ties, and other equipment, which uses it would be deprived of in consequence of the opening and use of Yale street thereover. The charge limiting appellant’s recovery to the use of its “tracks” necessarily excluded from the jury either of these elements of damages as pleaded and proved.

It is true, as has been held, that the Legislature, or a municipal corporation under grant of power from the legislature, may authorize the construction of highways or streets across a railroad right of way without making compensation therefor, in the exercise of their police power; and that the loss occasioned is not a taking without due process of law. New York, C. & St. L. R. Co. v. Rhodes, 171 Ind. 521, 86 N. E. 840, 24 L. R. A. (N. S.) 1227, and cases there cited. But it has also been held that such right or power will be strictly construed; and many cases hold that a street may not be laid out across a railroad right of way used for yard purposes without compensation; and that necessary structural changes in its property will entitle a railway company to compensation therefor. New York, C. & St. L. R. Co. v. Rhodes, 171 Ind. 521, 86 N. E. 840, 24 L. R. A. (N. S.) 1228, and cases there cited. And .in the following eases it is held that a railway company is entitled to compensation for the removal of switches and switch stands made necessary by the opening of a street or highway across the right of way: Central R. Co., prosecutor, v. Bayonne, 51 N. J. Law, 428, 17 A. 971; Morris & E. R. Co. v. Orange, 63 N. J. Law, 252, 43 A. 730, 47 A. 363; Southern Kansas R. Co. v. Oklahoma City, 12 Okl. 82, 69 P. 1050.

While the Supreme Court did not discuss, either in Gulf, C. & S. F. Ry. Co. v. Milam County, or Houston & T. C. Ry. Co. v. City of Dallas, supra, the question of the necessity of making compensation where the county or city exercise their right of eminent domain in laying out a highway or street across a railway right of way; still no other conclusion can be reached than that the court intended to so hold where the facts showed damages. In the first case damages were allowed, the court only excluding special damages claimed for things which the statute required the railroad to do without compensation, In the second case Judge Williams specifically noted that “there is no effort to apply the power of eminent domain,” and referred to the rule not allowing compensation for those things which the railroads were required to do by virtue of the police power. And while it was further held that the “limitation on the power of eminent domain, that property shall not be taken or damaged for public use without adequate compensation, does not of itself impose any restriction on the proper employment of the police power on any subject lying with its •sphere in a proper and lawrful manner,” still it is clear that the court did not intend to deny compensation for the laying out of a 'street across a railway right of way where damages resulted and were not within the category of things required of the railway in virtue of the police power regulating same.

It is true that the labor in removing switches and switch stands may not be different from the labor necessary to properly bring the crossing to a grade for street uses, still the structural changes may render the switches and switch stands wholly worthless, and not fitted for any other portion of appellant’s right of way. And the damages thus occasioned differ only in degree from damages occasioned by removing a depot or warehouse in order to lay a street or highway across a railroad right of way. And as regards damages arising from the deprivation of the use of the land for storage of cars, rails, etc., courts have universally required strict proof of the amount of such damages and have indulged no indefiniteness nor speculation thereof.

The judgment of the trial court will be reversed, and the cause remanded.

Reversed and remanded.


text:
    GAMER et al. v. LOVE et al.
    No. 12455.
    Court of Civil Appeals of Texas. Fort Worth.
    May 30, 1931.
    Rehearing Denied July 3, 1931.
    C. C. Gumm, of Fort Worth, for appellants.
    W. J. Rutlege, Jr., of Dallas, for appellees.
   DUNKLIN, J.

On October 19, 1925, a judgment was rendered by the district court of Dallas county in favor of Ralph M. Love and Gus Savano-vitcli against the Gamer Paper Company for the sum of $1,920.S0, with 6 per cent, interest thereon. That judgment was rendered upon a verdict which had theretofore been returned in that case on March 11, 1925. An abstract of that judgment in terms of the statutes was filed and recorded in the office of the county clerk of Tarrant county on November 21, 1925, in which county the Gamer Paper Company had its principal office and place of business. On June 20, 1925, four months prior to that judgment and about three months after the return of the verdict, the Gamer Paper Company, by Chas. Gamer, Sr., president, executed a deed of conveyance to Chas. Gamer, Sr., to lots 9, 10, and 11 in block 2, Daggett addition to the city of Port Worth, which deed was filed for record in the deed records of Tarrant county on June 24, 1925.

On April 19, 1927, execution was issued on the above-mentioned judgment, directed to the sheriff or any constable of Tarrant county, and was by the sheriff of that county levied on the real estate above described, on April 20, 1927.

On May 20, 1927, Chas. Gamer, Sr., joined by his wife, executed a deed of conveyance to the same property to his son, Charles J. Gamer, and that deed was duly recorded in the deed records of Tarrant county.

In the deed from the Gamer Paper Company to Chas. Gamer, Sr., the consideration and purpose of that conveyance was recited as follows:

“Whereas, the Gamer Paper Company, a corporation, of Port Worth, Texas, is the legal owner of the real estate and premises hereinafter described;
“Whereas, Chas. Gamer, Sr., President of said corporation, has become by purchase, and is now, the owner, of all of the shares of capital stock of said corporation, and is now the sole and only stockholder thereof;
“Whereas, said corporation has ceased to engage in the business for which it was created or to exercise the rights and privileges conferred upon it by its charter, and it is the intention of the said Chas. Gamer, Sr., in the near future to effect the dissolution of said corporation;
“Now, therefore, know all men by these presents:
“That the Gamer Paper Company, a corporation duly incorporated under and by virtue of the laws of the State of Texas, having its principal office in Port Worth, Texas, acting herein by and through Chas. Gamer, Sr., its President, in consideration of the premises, and for the purpose of transferring the legal title of the property hereinafter described to the beneficial owner thereof, has granted, sold and conveyed and by these presents does grant, sell and convey unto Chas. Gamer, Sr., of Port Worth, Tarrant County, Texas, all and singular the following described real estate situated in Tarrant County, Texas, viz: ” (Here follows description of the property.)

• The consideration recited in the deed from Chas. Gamer, Sr., and wife, to Charles J. Gamer, is as follows:

“Por and in consideration of the sums assumed and paid and agreed to be paid .by Charles J. Gamer as follows:
“(a) The assumption of the balance remaining unpaid upon an issue of Eighty-Pive Thousand ($85,000.00) Dollars Pirst Mortgage seven per cent, serial gold bonds, dated June 1, 1923, and secured by deed of trust of that date on the hereinafter described property in favor of the Interstate Trust •& Banking Company and Henry M. James, Trustee;
“(b) The assumption of the payment of state, county and city taxes for the year 1927, upon the hereinafter described property;
“(c) The execution by the grantee herein of a series of notes aggregating Eighty Thousand ($80,000.00) Dollars, said notes being sixteen (16) in number, payable to the order of Charles Gamer, Sr., for the principal sum of Five Thousand ($5,000.00) Dollars each, of even date herewith, ,due and payable on June 1, 1923, to June 1, 1949, respectively, bearing interest from date and for the first six (6) years at the rate of three per cent. (3%) per annum, and thereafter until maturity at the rate of five per cent (5%) per annum, interest payable semiannually on June 1st and December 1st of each year as it accrues; bearing interest after maturity at the rate of eight per cent (8%) per annum, both principal and interest being payable in the City of Port Worth, Tarrant County, Texas, and said notes providing that the failure to pay any one of them or any installment of interest thereon when due shall, at the election of the holder theréof, mature all of said notes; and further providing for the payment of ten per cent (10%) additional upon principal and accrued interest as attorneys’ fees should same be placed in the hands of attorneys for collection.”

After the levy of the execution mentioned above, Chas. Gamer, Sr., and Charles J. Gamer instituted this suit to enjoin the sale of the property under that writ.

A temporary writ of injunction was issued restraining the sale of the property pending the trial of the suit on its merits; but on the final trial that writ was dissolved and a judgment was rendered denying plaintiffs their prayer that the temporary writ be made permanent; and further decreeing a can7 cellation of the deed from the Gamer Paper Company to Chas. Gamer, Sr., and the deed from Chas. Gamer, Sr., and wife to Charles J. Gamer; also a cancellation of the notes given by Charles J. Gamer to Chas. Gamer, Sr., as recited in the deeds to Charles J. Ga-mfer. The judgment further decreed that the filing of the abstract of judgment, recited above, and the levy of the execution fixed valid liens on the property in controversy, which were superior to the claims of title under both the deeds above referred to, both of which liens were foreclosed and the property ordered to be sold by the sheriff to satisfy the judgment recovered by Ralph M. Love and Gris Savanovitch against the Gamer Paper Company. Erom that judgment the plaintiffs have prosecuted this appeal.

By cross-action Love and Savanovitch claimed valid liens by the filing of the abstract of judgment and the levy of the execution, which they prayed be foreclosed as against both plaintiffs. They also alleged that the conveyance to the president of the company was contrary to the provisions of articles 3996 (as amended by Acts 40th Leg. [1927] e. 30, § 1 [Vernon’s Ann. Civ. St. art. 3996]), and 3997, Rev. Civ. Statutes of 1925, by the terms of which that conveyance was a fraud as against the creditors; and further that the conveyance was made for the purpose of defrauding the judgment creditors of the corporation, including the plaintiffs, and that the same was made without consideration.

By supplemental pleadings and trial amendment, the truth of the allegations in the cross-action were put in issue.

The case was tried before a jury, and, after the evidence was concluded, the court instructed a verdict in favor of the defendants over plaintiffs’ objection, and rendered a judgment in accordance .with the verdict returned in obedience to that instruction. The trial judge also filed findings of fact and conclusions of law, which are as follows:

“I find that: (1) The Gamer Paper Company was on March 11, 1925, a corporation organized under the laws of Texas.
“(2) The stock of the said company was owned almost entirely by Charles Gamer, Sr., who was also the president of said corporation, one share of stock being owned by an employe and one share of stock by his son Charles Joseph Gamer, and one share by his wife, each of the latter two being directors.
“(3) On March 11,1925, Ralph M. Love, and others obtained a judgment against the said corporation for $1920.80 with interest at 6% per annum, and court costs amounting, to $29.15.
“(4) Said judgment was rendered pursuant to a verdict in said cause rendered some six months before that time, and after said verdict, but before the said judgment, the said Gamer Paper Company, by its president Charles Gamer, conveyed to the said Charles Gamer the warehouse located on East Eront Street which is involved in this suit, and which was substantially all the property that the Gamer Paper Company owned, it disposing of its stock of merchandise at the same time other persons, leaving it with no record assets of any kind.
“(5) On November 21, 1925, an abstract of judgment of the above cause was duly recorded in the judgment records of Tarrant County. ,
“(6) On April 20, 1927, Love et al caused to be issued an execution on said judgment, and levied by the sheriff of Tarrant County properly upon the East Eront warehouse above referred to. After said execution was levied Charles Gamer made a deed to said property to his son Charles Joseph Gamer, reciting the assumption of outstanding indebtedness and the execution of some notes and without the payment of any cash or other consideration than the notes.
“(7) Since said deed Charles Joseph Gamer has paid nothing on said property, except that the rents from the same have been applied to the lien indebtedness.
“(8) The Gamer Paper Company had ceased to do business at the time of the transfer of the property from Charles Gamer to Charles Joseph Gamer, but its charter was not revoked until some months later.
“(9) The Gamer Paper Company has not now and did not have, from the time of the deed above referred to from the corporation to Charles Gamer, any property sufficient to meet the debt evidenced by said judgment.
“(10) Charles Gamer and Charles Joseph Gamer attended the trial of said cause in Dallas County, hired attorneys and defended the cause and testified therein, and knew of the verdict and what it contained, and knew at- all times that a judgment would probably be rendered therein for Love et al against the Gamer Paper Company.
“(11) The deed from the Gamer Paper Company to Charles Gamer was made with the intent to defraud Love et al of the debt.
“(12) The Deed from Charles Gamer to Charles Joseph Gamer was also made in furtherance of the effort to defraud Love et al out of their debt and this intention was known to and was a part of the plan of Charles Joseph Gamer in accepting the deed.
“I conclude that: (1) The deed from the Gamer Paper Company to Charles Gamer is of no effect as against Love et al.
“(2) The deed from Charles Gamer to Charles Joseph Gamer is of no effect against Love et al.
“(3) Said conveyance should be as to Love et al set aside.
“(4) The abstract of judgment filed by Love et al fixed a lien upon the premises described in said petition.
“(5) The levy of execution issued by Love et al fixed a .lien upon the premises described in the pleading's.
“(6) Love et al should have an order of sale directing the sheriff to sell said property for the satisfaction of Love et al judgment against the Gamer Paper Company.”

While Charles Gamer, Sr., testified on the trial that out of his own personal funds he had paid off the obligations of the Gamer Paper Company, amounting to some $46,000, and failed to plead such payments as a consideration supporting the conveyance so taken by him, yet we believe that such testimony, in connection with other testimony and circumstances in evidence, was sufficient to require the submission to the jury of the issue, whether or not the corporation was then insolvent and whether or not the conveyance to him was for the purpose of defrauding the creditors of the Gamer Paper Company, as found by the trial judge.

As shown by the record noted above, at the time of the conveyance of the Gamer Paper Company to Charles Gamer, Sr., the judgment against the Gamer Paper Company had not been rendered, and was not rendered for four months thereafter. The filing of the abstract of that judgment could not relate back and create a lien on property theretofore owned by the paper company and not owned by it at the time of such filing. When it was filed the legal title to the property was in Chas. Gamer, Sr., and the judgment lien did not attach to it because of that fact, even though it could be said that the judgment creditor would have the equitable right by suit to cancel that deed and also the subsequent deed to Charles J. Gamer, and establish and enforce an equitable lien on the property to pay the judgment on the ground that they were made for the purpose of defrauding creditors of the corporation.

In Sugg v. Mozoch (Tex. Civ. App.) 293 S.W. 907, and authorities cited in the opinion in that case, it seems to be definitely settled that a judgment lien does not attach to an equitable title to realty owned by the defendant, but only to realty which the debtor holds by legal title. Other decisions, such as Johnson v. Darr, 114 Tex. 516, 272 S. W. 1098, and Lewis v. San Antonio Belt & Terminal Co. (Tex. Civ. App.) 208 S. W. 552, are in accord with that decision in principle.

Nor did the levy of the execution create a lien on the property unless the deed to Chas. Gamer, Sr., was made for the purpose of defrauding the creditors of the Gamer Paper Company, or else was in contravention of the statutes relating to the winding up of the business of a corporation upon its dissolution while in an insolvent condition. We do not believe the court was authorized to take from the jury the determination of the facts which would support either of those conclusions.

Accordingly, the judgment of the trial court is reversed, and the cause is remanded.